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Table 4.2 Summary of support measures for the agricultural sector, 2014-2015
MAG priorities Measures / financial resources available
Modernization and expansion of irrigation infrastructure and area
Reconditioning of the irrigation system in Zacatecoluca in order to reduce water losses and improve the efficiency of the system (US$254,476 of financing in 2015).
(...)
Environmental sustainability, mitigation of and adaptation to climate change • Design of a platform for policy formulation and review of the strategy for adapting agriculture to climate change, for the benefit of 450,000 subsistence farmers and 70,500 commercial-scale producers.
• Projects for the development of sustainable agriculture, production and planting of orchard and forest plants, reservoir construction, transfer of good farming practices, water harvesting, promotion of forest-pasture systems (investment of US$5.57 million in 2014 2015).

(...) In 2014, net power generation amounted to 5,793.1 GWh and came from the following sources: 27.7% hydroelectric, 23.4% geothermal, 38.9% thermal and 3.8% biomass (mainly bagasse (sugar cane residue)). (...)

(...) During the review period, the CNE (National Energy Council) issued El Salvador's New National Energy Policy 2010 2024, which lays down strategic guidelines for the future development of the sector. Its main objectives are: (...) to promote energy savings and the efficient use of energy, both in the public sector and in industry; (...)

Under the LGE (General Electricity Law), it is necessary to obtain a concession in order to generate electricity from hydraulic or geothermal sources. (...)

El Salvador is maintaining the tax exemptions provided for in the Law on tax incentives for the promotion of renewable energies in electricity generation, in force since end 2007. Under this law, any new investment in the generation of electricity from renewable energy sources (hydraulic, geothermal, wind, solar or biomass) is eligible for tariff concessions and other tax benefits (Box 4.1). Since the law was introduced, El Salvador has increased its installed capacity by 153.3 MW on the basis of geothermal and biomass renewable energy sources.

Box 4.1 Tax benefits for investment in the energy sector
(...)
(iii) Total exemption from the payment of taxes on income stemming directly from the sale of Reduced Emission Certificates (RECs) under the clean development mechanism (CDM) or on similar carbon markets.

Source: Article 3, Law on tax incentives for the promotion of renewable energies in electricity generation (Legislative Decree No. 462 of 2007) and its revision (Legislative Decree No. 148 of 2015).

In October 2015, the Legislative Assembly approved a reform of the Law on tax incentives for the promotion of renewable energies in electricity generation, in order to extend and relax the tax incentives regime for investment in renewable energy projects. The reform eliminates the 20 MW ceiling set in the original law, which made projects exceeding that capacity ineligible for the tax benefit, and also incorporates new renewable energy technologies such as tidal energy and biogas, while extending eligibility for the regime to existing power stations seeking to expand their renewable energy generating capacity.

As part of the FOMILENIO I Project, carried out between 2007 and 2012, new power transmission lines and solar energy systems were installed in the northern zone, where electrical connectivity is lowest. As a result of these works, some 35,000 households obtained access to the electricity supply system and 1,950 households were equipped with solar panel installations for generating electricity. The new structures were built by a public-private partnership.

(...) A recent study by the Supervisory Authority for Competition (SC) concluded that the liquid fuel market was characterized by moderate concentration; however, it identified some problems (very lengthy procedures for granting authorizations to operate as a distributor and environmental permits, as well as disproportionate fines for technical infringements) which could discourage new players from entering the market.

El Salvador undertook specific commitments under the General Agreement on Trade in Services (GATS) in six of the 12 categories of services covered by the Agreement: business services; communication services; environmental services; tourism services; transport services (air transport only) and financial services. Commitments were made in 25 of the sectors included in the Services Classification List drawn up by the WTO Secretariat.