The Colombian government’s energy development strategy

September 30, 2024

Carlos Adrian Correa Florez, general manager of Colombia's Mining and Energy Planning Unit (UPME), talks to The Energy Year about how central energy transmission is to the unit’s strategy, the importance of its pipeline of renewable energy projects and how Colombia is materialising its energy transition. UPME plans Colombia’s mining and energy development.

To what extent has energy transmission become a centrepiece of UPME’s strategy?
Many of UPME’s strategic projects revolve around the further electrification of society, which includes investments to incentivise electricity production and satisfy the rapid growth of electricity consumption. Modern society advances in parallel with electrification, and in this journey, Colombia still has a long way to go.
Colombia is peculiar. We have had very significant delays in electricity transmission projects, and this is to the detriment not only of electrification but also of the energy transition. There is no energy transition without energy transmission.
For this reason, we have put emphasis on electricity transmission infrastructure projects. Part of our objective has materialised through the reactivation of calls for tenders concerning the transmission system.
We have opened 10 calls for tenders since 2023, and many more are to come in 2025. We have been awarding these projects in different parts of the country with the aim of modernising our national transmission system.
Furthermore, with the launch of Mission Transmission, we have initiated the first phase of a broader plan by identifying critical transmission projects aimed at strengthening the electrical grid in urgent areas previously designated by XM, Colombia’s electrical market operator. These areas include, for example, Caribe, Chocó and Norte de Santander. Throughout 2024, we continued to announce additional projects.

How important is the pipeline of renewable energy projects under UPME’s umbrella?
UPME has a central role in the development of renewable energies. We have the mandate of approving new generation projects in the country, regardless of the technology – solar, wind, biomass, etc. We handle new plants that want to connect to the national interconnected system and are larger than 1 MW in capacity. Our role is central when it comes to energy transmission and the diversification of the country’s energy matrix.
UPME has recently approved a large number of renewable energy projects – around 19 GW worth. These projects already have their connection requests approved and are at different stages of development.
Some projects are finishing their construction stage and are ready to start injecting energy into the grid. Others are starting the process of land acquisition. Some are starting construction, while others are initiating their environmental licensing process. We have a very important 19-GW pipeline which will develop in the years to come.
In this pipeline, 14.2 GW correspond to solar projects, while 2.8 GW are wind energy projects. Moreover, solar energy is the technology that sparks the greatest interest among investors. Today, we exceed 1 GW of solar projects in commercial operation in Colombia. If we add solar ventures in commercial operation and at a testing stage, Colombia has just over 1.8 GW.
If we add self-generation and distributed generation into the equation, we are over 2 GW, mainly solar. These figures clearly indicate that Colombia’s renewables spectrum is advancing at an accelerated pace.

How is Colombia materialising its energy transition and advancing towards its ambitious renewable energy goals?
Power generation is not centralised in Colombia. There is a market scheme where generation activities are dependent on private players, not the State. The growth of power generation therefore depends on private investment and will.
Accordingly, we issue approvals or denials to those projects proposed by market players. Power generation projects do not depend on a public mandate, unlike transmission ones, which are rolled out through a public tender.
Despite this, we have put together an electricity plan for 2023-2037 through which we aim to incorporate 6 GW of solar energy. When it comes to wind, there is a projected development of 5-6 GW as well. This would be the ideal mix that would cover the energy needs in the country and diversify its energy matrix, making it greener and cleaner.
However, this does not mean that the generation market will move in this direction, as the market is free to define what technologies it incorporates and where. It thus depends on market dynamics – private players and investors. To an extent, one could say that letting markets move so freely is a very old-fashioned view of envisioning the energy sector.
The energy transition should be dictated by the State, following clear directives. Targets such as decarbonisation must be dictated from above so that they are applied. There should be a clear vision with ambitious targets to work towards. In this regard, the government has proposed the incorporation of 6 GW of renewables by the end of 2026.
UPME is supporting initiatives such as El Estallido and the 6-GW Solar Burst. We have brought in a group of professionals who are dedicated to accompanying the development of renewable energy projects. Fortunately, it has worked very well because this support has served to build bridges between different entities, companies, grid operators and the national interconnected system operator.
We have approximately 2 GW of projects, mainly solar, which is a huge achievement and aligns with the government’s objective set out in the National Development Plan. This administration is very ambitious in its energy transition goals. The country has tripled its target, aiming to reach 6 GW of renewably generated energy by the end of Gustavo Petro’s mandate in 2026.
The initial goal established in the national development plan has already been met, and we now want to triple this number. There is still a long way to go, but we are confident we will reach these ambitious targets.

What impact do you see from the “energy communities” model?
The “energy communities” model is an innovation implemented by the Ministry of Mines and Energy. The creation of these structures was not easy, as there was a lot of work around the prioritisation criteria for these communities.
In a first exercise, the ministry received 18,000 applications from energy communities across the country. To allocate these resources efficiently, criteria must be developed to prioritise energy communities that are in particularly vulnerable areas.
The ministry has tried to generate the most progressive criteria in terms of energy democratisation.
However, the government’s commitment to energy democratisation is not only about providing access and greater coverage, which is something basic. Sadly, failures of our market scheme have given way to a reality where 1.2 million households still don’t have electricity. Democratisation of energy has to do with energy ownership as well.
Past systems have tended to be oligopolistic. Moreover, centralised energy schemes are very capital intensive and generate few players because the investments are very high. This makes ownership very concentrated and reduced to only a few large players with financial muscle.
The beauty of renewables, these communities and alternative decentralised schemes is that the ownership of this energy remains with the people. Even in terms of microeconomics, the rules by which markets are developed say that there must be many – ideally infinite – consumers and ideally an infinite number of producers in order to create the conditions for perfect competition, something that never happens in reality.
Even in that scenario of neoclassical marginalist economics, we need many energy producers to have more affordable prices. These energy communities also want to move towards the democratisation of ownership, as they would generate more efficient markets, and in addition, the country would gain sovereignty over its own natural resources and the energy it uses.
Lastly, we should note that energy communities are not a Colombian creation. In Europe, there have been theoretical and practical developments in the creation of these communities and co-operatives for years. In trying to replicate that exercise, we are developing this initiative.

What infrastructure is UPME considering to cater to the country’s urgent gas needs?
UPME is the main body in charge of planning natural gas infrastructure in Colombia. This infrastructure guarantees the reliability and supply of natural gas across the country in the short and medium term.
In the last document we published, titled “Proyecciones de Demanda de Energía Eléctrica y Gas Natural para el periodo 2023-2037” [Electricity and Natural Gas Demand Projections for the Period 2023-2037], we insist on the need to focus on projects that were already adopted five years earlier but were not developed or completed for diverse reasons.
Apart from these projects, we are also identifying other pipelines that could greatly improve the reliability of service provision, particularly in works that would close rings and connect part of the coast with the centre of the country. This would generate a better distribution of flows and make better use of the available gas.
We have also reanalysed the viability of the Pacific regasification plant – Pacific LNG. This new regasification plant is still a necessary infrastructure project and is projected to come on line no sooner than 2030. This proposed venture requires immediate action so that the competitive mechanism to award this infrastructure can be developed.
La Guajira is also an interesting area for gas. This gas could come from different sources – offshore, for example, which is currently in the exploration stage. Regarding it, we have recently seen a combined effort from Ecopetrol and Petrobras on Sirius-2.
We are also considering the option of additional imports at some point in La Guajira, taking advantage of existing infrastructure. Lastly, there is the option of receiving additional gas from Venezuela that could be imported into La Guajira. Developing gas infrastructure in this part of the country is very important.
Therefore, we are considering all possible options to increase the amount of available gas. It will come through the development of Colombian fields – onshore and offshore – and through additional imports via our regasification terminal and other terminals in Cartagena and/or through Venezuela.

How is UPME working to reinforce liquids and gas infrastructure while preparing it for future trends?
Liquids remain an important part of the Colombian energy matrix. In this arena, we see a need to strengthen infrastructure in the southwest of the country. This area has a deficient infrastructure in terms of pipelines, particularly for transporting LPG, jet fuel, diesel and gasoline.
We also see a need to strengthen our fuel storage capacity, as we have had few developments in the area of storage. Our liquid storage capacity can sustain operations for up to 14.5 days according to data from 2023 reported by 90% of our liquid fuel agents. This taps into the principle of energy security, which is crucial.
We are now working with the ministry to identify the most strategic locations for these liquid storage facilities. In parallel, we are trying to equip all planned infrastructure for both liquids and gas for the future. In other words, we are doing reconversions to existing infrastructure such as pipelines and also designing new infrastructure that can also transport hydrogen. We are also looking at equipping liquids infrastructure so it can be used for natural gas.

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