Integrating electric mobility and distributed solar in carbon-negative Panama: Readiness assessment and policy roadmap for sustainable energy transition

Panama, despite its carbon-negative status, faces critical challenges in integrating electric mobility and distributed solar power into its energy system. These challenges stem from rigid market structures, outdated regulatory frameworks, and limited digital infrastructure, which together hinder the development of a flexible, decentralized energy model. This study assesses Panama's readiness for decentralized energy adoption using a structured five-step methodology that combines policy analysis, barrier identification, and comparative benchmarking with seven international case studies. These countries are grouped into gradual (Chile, Colombia, Mexico, Brazil) and advanced (Germany, Norway, Singapore) transition clusters. Applying evaluation criteria from IRENA and IEA, the study examines five key dimensions—regulatory framework, grid infrastructure, economic incentives, institutional coordination, and grid stability. The assessment positions Panama at Low to Medium readiness, constrained by minimal digitalization, limited demand-side flexibility, and regulatory misalignment with emerging decentralized technologies. To address these gaps, a phased policy roadmap is proposed, focusing on regulatory modernization, smart grid deployment, and stakeholder coordination. The roadmap also integrates key socioeconomic considerations—including employment generation, equitable access to prosumer models, and electricity affordability—as structural elements of a just transition. This strategy aims to facilitate the integration of electric vehicles and distributed solar generation while safeguarding grid stability and preserving Panama's carbon-negative balance. The findings offer a replicable framework for developing countries with similar market rigidities, demonstrating how phased, context-specific reforms can unlock the benefits of decentralized energy while supporting long-term sustainability, energy resilience, and inclusive development.