EL SALVADOR · ENERGY
Key Facts
- The country El Salvador is a small, dollar-using Central American nation whose President Nayib Bukele is one of Washington’s most valued partners.
- What happened On Tuesday, 13 October, Bukele and Spanish company Cox signed an El Salvador energy deal and water plan estimated at US$2.9 billion.
- What gets built A gas import terminal with a power plant of about 380 megawatts, two solar plants, large batteries, and water and sanitation works.
- The money About US$1.8 billion goes to gas, US$600 million to water, US$300 million to batteries and US$200 million to solar power.
- Timeline The projects are to be built over three years, but approvals and the binding contracts are still pending.
- Still open Bukele promises lower electricity bills once the plants run, but no size or date for a tariff cut has been given.
On Tuesday, 13 October, Cox, a Spanish water and energy company listed in Spain, signed an El Salvador energy deal worth an estimated US$2.9 billion. It covers a gas terminal, solar plants, batteries and water works, and President Nayib Bukele called it the country’s largest private investment ever.
For Americans, it matters because El Salvador uses the US dollar and is one of Washington’s closest allies in Central America. The same day, Secretary of State Marco Rubio spoke with Bukele about keeping ports and other critical infrastructure free from “malign foreign influence”.
What the El Salvador Energy Deal Includes
Cox says the El Salvador energy deal rests on four partnerships: battery storage, solar power, natural gas, and water and sanitation. The company disclosed it to Spain’s stock market regulator, the CNMV, on Wednesday, 14 October.
The biggest piece is a terminal for liquefied natural gas (LNG) and a combined-cycle power plant of about 380 megawatts. It accounts for US$1.8 billion, and Bukele said Cox could sell gas to other generators and export it to neighbours such as Guatemala.
Batteries of 440 to 500 megawatt-hours, expandable to 1,000, would store daytime solar power for use at night. Two solar plants, with an initial capacity of about 200 megawatts expandable to 400, complete the power side of the plan.
The last US$600 million goes to water and sanitation, which Bukele called the largest drinking-water investment in the country’s history. Cox says it will widen coverage and raise the quality of the service.
Who Is the Spanish Firm Behind It
Cox calls itself a global water and energy utility, and its shares trade on the Spanish stock exchanges. Its founder and executive chairman, Enrique Riquelme, signed the deal with Bukele at Casa Presidencial in San Salvador.
The company says Latin America makes up about 95% of its business, and it plans to invest more than US$7 billion there. Recent projects include a desalination plant at Rosarito in Mexico and the purchase of Iberdrola’s Mexican business.
Cox will arrange project loans from international banks, multilateral lenders and export credit agencies, then build and run the plants. The state is expected to be a partner, and the solar plants will be developed with CEL, the state-owned hydroelectric company.
The US Connection
El Salvador already has a 380-megawatt gas-fired plant, Energía del Pacífico, developed by Chicago-based Invenergy for about US$1.15 billion. The Cox plant would be about the same size, and Bukele said its terminal would be the country’s first onshore gas storage.
Rubio’s call on Tuesday focused on keeping critical infrastructure, including ports, “secure and free from malign foreign influence”, the State Department said. Its readout did not mention Cox or the El Salvador energy deal.
In August, the State Department called Bukele “one of our most valued partners in the region”. It also said Washington would host an economic summit with El Salvador to deepen the partnership.
Bukele’s Promise of Cheaper Power
Bukele said that once the new plant runs, the country can “stop depending on dirty energy such as bunker”, so household tariffs “will go down”. Bunker is heavy fuel oil, and he said older plants burning it are switched on when generation falls short, pushing prices up.
He said the tariff is set nationally and reviewed every three months, so any saving would reach homes, shops and hospitals alike. No figure for the cut and no date for when it would show up on bills were given, El Diario de Hoy noted.
Bukele put the investment at about 7% of El Salvador’s annual output, above the US$1.6 billion committed by Yilport, the Turkish operator of Acajutla port. In Cox’s statement, he said the deal brings cleaner energy “without committing new public funds and with clear rules”.
What It Means for You
For families and firms, the El Salvador energy deal promises lower power bills, but that depends on plants that do not exist yet. Prices are in US dollars, so any cut would reach bills without currency swings.
For holders of El Salvador’s dollar bonds, a large project funded by outside lenders could lift growth without new public money, as Bukele promises. Investors can weigh that promise against the IMF’s latest growth forecast for El Salvador.
For US gas exporters and equipment makers, a new LNG terminal could mean a new customer in Central America. Cox has not said which companies will supply the gas, turbines or batteries.
What Is Not Known
Salvadoran outlets call the signed text a memorandum of understanding, and Cox expects approvals and progress on definitive contracts in the coming weeks. Neither side has said where the terminal, the power plant or the solar plants will be built.
It is also unclear where the LNG will come from and how large a stake the state will hold. No schedule for payments or construction has been published beyond the three-year target.
More: El Salvador news in English, every day from The Rio Times.
Frequently Asked Questions
What is the El Salvador energy deal with Cox?
President Nayib Bukele and Cox, a Spanish water and energy company, signed the El Salvador energy deal on 13 October, estimated at US$2.9 billion. It covers an LNG terminal with a gas plant, solar plants, batteries, and water and sanitation works.
Who pays for the projects?
Cox says it will arrange project loans with international banks, multilateral lenders and export credit agencies. Bukele says the plan commits no new public funds, although the state is expected to be a partner.
Will electricity get cheaper in El Salvador?
Bukele says household bills will fall once the new plants replace older generators that burn costly fuel oil. No figure or date for a tariff cut has been given.
When will the El Salvador energy deal deliver?
Cox says the El Salvador energy deal will be carried out over the next three years. Cox expects the approvals in the coming weeks, along with progress on the binding contracts.
Sources: Cox Infrastructure Group, Other Relevant Information filed under Spain’s Securities Markets Law (CNMV), 14 October 2026; Cox, press release on the El Salvador agreement, 14 October 2026; US Department of State, Secretary Rubio’s Call with El Salvador President Bukele, 13 October 2026; US Department of State, Advancing the United States-El Salvador Economic Partnership, 21 August 2026; El Diario de Hoy, 13 October 2026; Diario El Mundo, 13 October 2026; Diario El Salvador, 13 October 2026; Invenergy, Energía del Pacífico project page, 14 October 2026; Forbes México, 13 October 2026.
This article was produced by The Rio Times’ automated newsroom system. How we use AI · Report an error · Editorial responsibility: Matthias Camenzind, Editor-in-Chief