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1 Introduction At the 2000 World Geothermal Conference in Japan, reports indicated that geothermally-fueled electric power was being generated in 21 nations around the world, with an installed capacity that had reached 7974 MWe (Huttrer, 2001). In Central America, which lies within the volcanically active Cocos-Caribbean subduction zone, geothermal energy is a popular and profitable energy alternative. El Salvador, the smallest of the seven2 Central American countries, having an area of 21,040 km2 and a population of 6.47 million (2003), is the largest producer of geothermal energy in the region. In fact, it was the first Central American country to construct and utilize geothermal power plants. El Salvador, which is commonly called Land of Volcanoes, is characterized by major geothermal zones, hot wells, hot springs and fumaroles. Earthquakes and other seismic activity occur frequently, some with devastating consequences. Exploration for geothermal potential in El Salvador began 50 years ago, in 1954 (Huttrer, 2001) and continued extensively into the 1960s and 1970s. However, from 1980-1992, most geothermal exploration was suspended, due to a continued civil war which disrupted the national economy, channelling most resources toward military spending and away from social services, and resulting in a near collapse of the tax system. To make matters worse, this socio-political instability weakened the country’s ability to secure development loans and foreign investment. Despite these circumstances, El Salvador has been able to develop a geothermal energy industry which can serve as a model for many developing countries. A 1999 U.S. Department of Energy (Battockletti et al) report estimated that El Salvador has geothermal power potential of over 2210MWe. Today, over 24% (Rodriguez and Herrera, 2003) of El Salvador’s electricity output is from geothermal energy, representing almost 940GWh of power (2003), and making El Salvador a ‘leader per capita in the sector’ (Washington Post). This paper focuses on the history and development of the geothermal energy industry in El Salvador since its inception fifty years ago. Specifically we will examine the policies and actions which led to such growth of the sector and look at the technical, socio-political, economic and 2 Belize, Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua, Panama Janelle Prevost Spring 2004 The Geothermal Energy Industry of El Salvador 2PDF Image | Geothermal Energy Industry of El Salvador
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