Dominican republic Country Commercial Guide
Learn about the market conditions, opportunities, regulations, and business conditions in dominican republic, prepared by at U.S. Embassies worldwide by Commerce Department, State Department and other U.S. agencies’ professionals
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Renewable Energy
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Overview

Despite the efforts to increase the installed capacity of electricity generation from renewable sources made by the present administration, the electric power sector remains one of the most significant problems affecting the Dominican economy. Although the DR continues to experience electrical outages that can last from several minutes to several hours, there are signs that the DR is poised for energy transformation.  

The transformation of the energy sector is a collective initiative from the National Commission of Energy (CNE), Ministry of Energy and Mines (MEM), and Superintendency of Electricity (SIE) among other government institutions, all encouraged by the current administration. It is in this effort that the CNE has outlined the policies and planning of the electricity sector in the latest draft of the “National Energy Plan 2021 – 2036” (PEN).

The PEN presents the current condition of the Dominican energy sector while outlining its future development, based on the vision of energy policies, from the public and private sectors, in favor of an optimal energy system at a technical and economic level. As of early 2025, the DR’s installed generation capacity connected to the National Interconnected Electric System (Sistema Eléctrico Nacional Interconectado - SENI) was sufficient to meet demand. For instance, the system saw a peak demand of 3,923MW while achieving a new renewable generation record of 1,554MW. The supply shortfalls and occasional blackouts thus appear to be due to systemic problems rather than a lack of generation capacity. Technical and non-technical losses remain high, hovering between 34% to 39%.

The historically high costs of fossil fuel imports have made the development of renewable energy projects a priority for the government and the DR has committed to reducing its greenhouse gas emissions by one-third by 2030 compared with existing levels in 2010.  

The Dominican Republic passed legislation on renewable energy in 2007 as part of its endeavors to achieve the above targets. The main objective of this law is to increase the contribution of renewable energy sources in electricity generation to 25% by 2025 and 30% by 2030.  The DR government’s efforts to encourage clean and renewable energy generation include generous tax incentives for investors along with an investment of $450 million between 2025 and 2028 to expand transmission lines and substations, and mandates for new renewable projects to include battery energy storage systems (BESS) to reinforce the SENI.

Legal Framework for Renewable Energy

Several laws comprise the legal framework for renewable energy projects in the Dominican Republic. These include the following:

  • General Electricity Law 125-01
  • Renewable Energy Incentives Law 57-07
  • General Law on Environment and Resources Law 64-00

Opportunities

The Renewable Energy Incentives Law (57-07) grants several incentives to businesses developing renewable energy technologies. This law was passed in 2007 as part of the Dominican government’s efforts to invigorate local energy generation from renewable sources, as well as to promote the production of high-value renewable energy products. The incentives included a 100% tariff exemption on imported inputs (equipment and materials) and a 10-year exemption from all taxation on profits up to, but not beyond, the year 2020.  While the tariff exemptions on equipment and materials are still in effect, the income tax exemption for energy generation has since been eliminated.  In 2012, the law was modified as part of fiscal reform measures, reducing the tax incentive for small-scale self-producers of renewable energy and eliminating the 10-year tax exemption on profits from the sale of electricity generated from renewable sources.

The current administration has advocated for the implementation of a gradual shift to diversify the energy matrix with cleaner technologies and has set a target for renewables to account for at least 25% of power generation by 2025 and 30% by 2030.  To help reach this target, the administration has said it plans to restore the level of fiscal credit for investments in renewable energy systems to 75% as established in renewable energy incentives law 57-07 since a modification during the previous administration reduced the amount to 40%. Furthermore, in August 2025, one of the government energy authorities (The Unified Council of Distribution Companies – CUED) launched a 600 MW tender for renewable energy (solar and wind) with a mandatory inclusion of Battery Energy Storage (BESS) in their proposal, as required by the Superintendency of Energy.

There has already been significant investment in the renewable energy space locally due to recent efforts by the Dominican government, and it is expected that there will be increased investment in renewable energy as many of the government’s clean energy initiatives begin to take further effect.

Resources

  • Francesca Fermín, Commercial Specialist; francesca.fermin@trade.gov
  • Comision Nacional de Energía (CNE)
  • Ministry of Energy and Mines (MEM)
  • Superintendence of Electricity (SIE)
  • Performance Report of Electrical State Companies January-May 2023
  • “The Dominican Republic Construction Market Size, Trends, and Forecasts by Sector - Commercial, Industrial, Infrastructure, Energy and Utilities, Institutional and Residential Market Analysis to 2029 (H1 2025)” report.

Hydrocarbons

Overview

The Dominican Republic is actively developing its hydrocarbon sector, offering significant opportunities in exploration and associated infrastructure, anchored by a new legal framework, Law 37-25. The primary investment focus is on an upcoming licensing round, likely in 2026, for onshore and offshore blocks in six basins, with the government providing extensive geological data to attract foreign capital, which is required to include a minimum 15% Dominican shareholding. Beyond exploration, key opportunities lie in regional cooperation, including a partnership with Guyana for potential joint oil exploration, and the development of refinery and petrochemical infrastructure to boost energy and food security. Additionally, investment is needed in the LNG midstream sector for long-term supply, storage, and distribution, as well as in technical consulting and specialized training to support the nascent industry.

Resources

  • Francesca Fermín, Commercial Specialist; francesca.fermin@trade.gov
  • Dominican Republic Oil and Gas Market Report 2025 – OG Analysis – July 2025
  • “Ministry of Energy and Mines plans oil exploration by 2026” - DMK Abogados – July 2025

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