The Colombian World Energy Council Member Committee aims to study and implement of projects aimed mainly at the rational use of energy resources in all its aspects, in order to promote sustainable energy development. These projects consider the production, transportation, distribution, marketing and use of energy for maximum benefit, taking into consideration global trends in regulation and minimizing environmental impacts. COCME’s mission is to promote the sources and sustainable use of energy to provide greater benefits for people.
José Antonio Vargas Lleras is the World Energy Council’s Vice Chair for the Latin America & Caribbean region and also serves as Chairman of the Colombian Committee of the Council. Since 2006 he has been Chairman of the Board of Directors of Electricity Distribution Company CODENSA and of Electricity Generation Company Emgesa, subsidiary firms of Enel-Endesa in Colombia. Dr Vargas Lleras has been Chairman of the Energy Commission for Regional Integration (CIER) and has held several managerial positions in many companies in the Colombian electric sector including the post of CEO of the Bogota Power Company. Professionally trained as a lawyer, and also a university professor, he has served as an Ambassador to the European Union and the Permanent Representative of Colombia to the World Customs Organisation.
Jose Vicente Camargo is the Secretary of the Colombian Committee of the World Energy Council. Camargo developed his professional experience in Interconexion Electrica S.A -ISA, working in technical and executives charges. Since 1998 he has been the International Coordinator of Generation & Transmission at CIER, leading and conducting studies, projects, work groups, conferences, seminars and other activities, developed in the CIER. He graduated as an electrical engineer from Universidad Nacional de Colombia, Bogotá 1972. He specialises in operation and control of interconnected networks and systems.
Energy in Colombia
This year, uncertainty remains regarding the impacts of El Niño on the Colombian energy system. Colombian energy leaders expect that the lessons from previous years as well as the advances in meteorological forecasts will allow Colombia to build a more robust roadmap to mitigate the negative effects of the phenomenon in 2019.
In 2018, civil society promoted a referendum to impose rules and sanctions on corruption. This has translated into legislative and regulatory actions, inducing higher transaction costs and discouraging foreign investment in the country. In addition, the policies of the United States on issues such as interest rates (commercial and environmental) created in 2018 a high degree of uncertainty for the Colombian energy sector in terms of investment and volatility of commodity prices.
Significant penetration of technologies in transportation has not been achieved. Regulation in this area is very complex and the incentives for the promotion of electric mobility move very slowly. The Council’s Colombia Member Committee has proposed measures to be included in the 2018-2022 Development Plan and in the financing law for 2019.
Extreme Weather Risks: The Global Climate Risk Index (2017) listed Colombia as one of the most affected countries by weather events, with losses estimated at US $ 315 million. Indeed, between 2015 to 2017, El Niño directly impacted over 719 municipalities Colombia through floods and landslides. Electricity generation is one of the most affected sectors due to the high vulnerability of its source mix.
Corruption: The 2018 Issues Monitor map identifies corruption as an issue with great uncertainty and great impact, displacing terrorism. The signing of the peace accord seems to be the key factor shaping this perception. The national referendum against corruption confirms the interest of Colombians to eliminating corruption and its negative impacts on the economy, politics, justice and everyday life. The transparency of contracting in the public sector will promote external investments by reducing the number of transaction contracts associated with corruption.
US policy: The United States is the main trading partner of Colombia as part of an agreement to fight drug trafficking in the region. This situation makes Colombia vulnerable to the direction of US foreign policy. Colombian energy leaders are worried that the current US Administration’s foreign policy may hinder international efforts necessary to deal with climate change, corruption and problems with global impacts.
Renewable Energy: The main objective of Colombia’s energy sector is to diversify its supply mix and reduce vulnerability to extreme weather events. Renewable energies are key for achieving this goal. Law 1715, enacted in May 2014, focuses on the development and use of non-conventional sources of energy within the Colombian energy system. This law gives tax incentives to companies that execute all kinds of renewable energy projects. This initiative goes in the right direction but not at the required speed.
Energy efficiency is key to the energy sector and the Colombia’s competitiveness. The Indicative Action Plan, 2017 - 2022 of the Ministry of Mines and Energy promotes the rational use of energy through actions in the transport and industrial sectors and large energy consumers. It includes a new institutional arrangement highlighting, among others, the evaluation of the creation of an-Energy Efficiency (EE) Information Manager - GIEE and the promotion to agents that provide energy services for the execution of EE projects. The increase in EE for 2022 of 9.05% stands out.
Innovative transport: The growth of urban cities in Colombia entails great challenges in the provision of services to large and dispersed populations. In addition, poor air quality in cities is an important health concern for local governments. The objective is to achieve sustainable mobility through the penetration of clean technologies in transport, such as electric vehicles. The Colombian government is pushing the use of electric vehicles and the Council’s Colombia Member Committee has developed recommendations on the topic. The Member Committee is also currently coordinating a taskforce on the subject.
The current situation of the Colombian electricity market is characterised by its low competitiveness, reduction of the quantities of energy offered in conditions of tight supply and high demand, lack of standardisation of contracts and high exposure to climatic phenomena. Solutions to this situation imply the diversification of the energy matrix by developing storage capacity, increasing the competitiveness of the sector, promoting technological reconversion and encouraging energy efficiency. Other action priorities include replacing liquid fuels and encouraging self-generation in areas which are not interconnected.
Digitalisation keeps its low uncertainty and is located in the priority actions section as it has a greater impact than previous years. The Colombian Member Committee holds events to promote technological innovation in the sector. Biofuels move from a weak signal to priority actions. This can be attributed to the increase in gasoline blends and their contribution to reducing emissions. Electricity prices grow in uncertainty and maintain their perception of impact, which relates to the increase in the costs of restrictions (physical limitations or network operation) that go directly to the tariff.
According to the Colombia Issues Monitor map, in 2019, Colombian energy leaders will be busy focusing on extreme weather risks, renewable energy, corruption, energy efficiency and innovative transport. Dominated by fossil fuels and hydropower, the Colombian government has recently been working to encourage the development of non-conventional renewable energy sources. To this end, it has set a goal of increasing the capacity of these sources to 11,113 MW in 2018 (compared to 9,893 MW in 2013) and in adopted Law 1715, which provides for the integration promoting these sources and promoting both energy efficiency and demand-side measures.