International Funding Fuels Colombia’s Green Energy Revolution

Felicity Bradstock

Felicity Bradstock is a freelance author specialising in Energy and Finance. She has a Grasp’s in Worldwide Pattern from the College of Birmingham, UK.

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• Colombia is investing $40 million in an vitality transition idea to shift far from fossil fuels and in opposition to renewable vitality sources.
• The authorities has banned new oil and gasoline exploration licenses and is promoting the reach of solar, wind, and hydrogen energy.
• Despite challenges, Colombia targets to diversify its vitality mix and elevate its renewable vitality skill to meet growing demand.

Colombia is a major producer of oil and gasoline and is frequently constructing its renewable vitality replace. In 2016, the South American issue launched its Energy Conception 2050, geared toward diversifying the nation’s vitality mix to encompass wind energy vegetation, solar PV, and geothermal vitality generation, and be obvious a legitimate vitality present in the arriving decades. 

In 2023, Colombia’s vitality mix consisted of 41.2 p.c oil, 22.8 p.c natural gasoline, 11.2 p.c coal, 12.5 p.c biofuels and ruin, and 12 p.c hydropower, in step with the Worldwide Energy Company (IEA). On the choice hand, it produces spherical 75 p.c of its electrical energy from renewable vitality. The nation’s vitality demand has grown mercurial in contemporary times, by spherical 95 p.c between 2000 and 2023, demonstrating the need for the enlargement of Colombia’s renewable vitality skill to meet this need. 

In October, Colombia launched a new $40-million investment idea for an vitality transition, geared toward intriguing far from a reliance on fossil fuels. The idea entails financing for nature conservation, such as ecotourism, sustainable agriculture, and ecosystem restoration. It also covers dapper vitality initiatives and targets for the electrification of transport. 

The Ambiance Minister, Susana Muhamad, stated the idea will seemingly be such as the donor-backed Factual Energy Transition Partnerships (JETPs) viewed in South Africa, Vietnam, Indonesia and Senegal. The authorities stated it was in discussions with the U.Okay., Germany, Canada, and the EU, as nicely because the Inter-American Pattern Financial institution, about doable funding alternatives. Muhamad acknowledged, “We are on the technique to consolidating a donor roundtable that can allow us to get a truly critical financial bundle for the nation.” 

Since taking plan of labor in 2022, left-flit President Gustavo Petro pledged to transition far from oil and gasoline, which Colombia has long relied on for every energy and earnings. Petro has blocked new oil-and-gasoline drilling and spoken publicly about his targets to decrease manufacturing in favour of renewable that it’s doubtless you’ll mediate of choices. This is viewed by many as controversial for a nation that is the fifth-ultimate exporter of coal and an oil and gasoline producer with neat untapped reserves. At the COP28 local climate conference in 2023, Petro became the main leader of a neat nation and the main fossil gas-producing issue to endorse a call for a Fossil Fuel Non-Proliferation Treaty, an thought that had beforehand handiest been supported by civil society and minute island countries. 

In 2023, the Colombian authorities made the groundbreaking transfer to ban new oil and gasoline licenses. Irene Vélez, the minister for mines, acknowledged on the World Economic Dialogue board, “We maintain determined now to not award new oil and gasoline exploration contracts, and whereas that has been very controversial, it’s a clear imprint of our commitment in the battle against local climate swap… This resolution is fully pressing and wants quick action.” On the choice hand, the authorities has tried to revive some unique oil and gasoline initiatives to retain constructing the replace with out the must approve new licenses. 

In the intervening time, Colombia has been increasing plenty of of its renewable vitality sectors, including dapper hydrogen, as nicely as wind, solar and hydro- energy. In April, the World Financial institution and the Asociación Hidrógeno Colombia met to say in regards to the aptitude for the usage of some of the nation’s low-worth solar and wind vitality to get dapper hydrogen to energy highly polluting heavy industries, such as cement, steel, mining, and chemicals. In 2023, the World Financial institution licensed a $150 million mortgage to promote Chile’s dapper hydrogen constructing, and it expects to serve Colombia fabricate its hydrogen replace via a a similar funding design.

In October, Colombia’s Energy Ministry announced it had got hobby from seven in another country and two local companies in an offshore wind energy challenge, with formal bids anticipated within the main six months of 2025. The companies encompass Colombian issue oil firm Ecopetrol, the energy firm Celsia, Spain’s BlueFloat Energy, Denmark’s Copenhagen Infrastructure Companions, Belgium’s Jan De Nul and DEME, China’s PowerChina and China Three Gorges, and Britain’s Dyna Energy, in step with the Ministry. “The aim of this first spherical is to place maritime areas wherein is able to be place in between 1,000 and 3,000 megawatts,” the Ministry stated in an announcement. “This task will seemingly be the main in Latin The united states for the generation of offshore wind energy,” it added. 

In February, the authorities awarded new licenses for electrical energy-generating initiatives, aiming to lengthen skill by 4,489 MW in 2027 and 2028. The Ministry of Mines and Energy assigned 99 p.c of the brand new skill to solar vegetation and the remaining 1 p.c to thermal biomass vegetation, repairing a gasoline plant, constructing a biomass plant, and lengthening a smaller biogas plant. The Ministry stated that this transfer will indicate that solar energy overtakes thermal vitality skill to contribute 26 p.c of the nation’s electrical energy. 

Colombia is working to diversify its vitality mix, supported by nationwide insurance policies aiming for a transfer far from a reliance on fossil fuels in favour of a green transition under President Petro. The introduction of a $40-million investment idea for an vitality transition is anticipated to attract higher ranges of in another country funding to power the reach of Colombia’s green vitality skill. In the intervening time, the ban on new oil and gasoline exploration licenses will pork up a uninteresting transfer far from fossil fuels. 

By Felicity Bradstock for Oilprice.com

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