Colombia PV Market Developments

www.vectorcuatrogroup.com

Adio Stefoni
Business Development
Manager
South America
Ta b l e o f C o n t e n t s

1. Energy Market Development

2. Challenges in the PV Market

3. Upcoming Opportunities
1 Energy Market
Development
Energy Market Development

 Colombia adopted the law nº 1715, which establishes the legal and
2014 regulatory framework for investment in development of renewables; providing
tax, accounting and import incentives.

 9 of Colombia’s 32 departments were in a state of emergency due to the

2015 extreme drought.
 Wholesale electricity prices raised, from an average of 45 USD/MWh in 2012
to 119 USD/MWh in 2015 for regulated market users.

 CREG (energy regulator) presented 4 proposals for the integration of

2017 renewables; all of which were based on an auction scheme with bidders
signing PPAs for 15 years.

 Colombian government enacted the decree 0570, allowing solar and wind
power plants to have long term purchase agreements.
2018
 The Ministry of Mines and Energy of Colombia published the call for the first
auction for large-scale renewable energy projects.
2 Challenges in the
PV Market
 Challenges in the PV Market

 It is a fixed payment generators receive of similar character to paying for

installed capacity.
 Generators receive payments for up to 20 years regardless of their
Cargo por participation in the electricity market.
confiabilidad  Generators must ensure they remain available to provide energy when
called upon.
 This scheme is intended to ensure the reliability in the supply of energy in
the long term at efficient prices.

 The five largest generators have more than 70% of the market.
Oligopoly  Foreign investor must face the challenge of a market ruled by a few with
slow regulatory changes.
 Challenges in the PV Market

 El Niño is a phenomenon that causes drought and high temperatures

across Colombia.
El Niño
 Colombia’s energy market has experienced drought, electricity rationing,
and increased dependence on thermal power.
 The energy matrix has more than 70% of the installed capacity in
hydropower.

 The transmission grid doesn’t reach the area with the highest wind and
Transmission solar resource in Colombia (the Guajira Peninsula).
Grid  There are plans to expand the grid to that location by 2023.
3 Upcoming
Opportunities
Upcoming Opportunities

• The government plans to add 7 GW

to the grid by 2027.

• It is expected that more than 20% of

the upcoming capacity will come
from a carbon thermal generation.

• The government informed that there

are over 200 renewable energy
projects registered.
Upcoming Opportunities

1 GW Auction in 2019

• Scheduled to happen in January 2019.

• The tender will offer 10-year power purchase agreements (PPAs).
• All types of projects under development as well as existing power plants can
participate.

• The government will select solar, wind and biomass projects with a capacity of
more than 10 MW.

• Winners have to deliver the power as from December 2022, and must guarantee
an annual energy supply.

• CREG will define a maximum price.

• Price will be in COP/kWh.
Upcoming Opportunities

Distributed Generation

• Colombia has a large non-

interconnected areas, from Amazon
forests to hard-to-reach Andean
areas.

• Communities in remote and rural

areas are off-grid, often have
electricity less than eight hours per
day.

• In this communities primary energy

source is diesel, however many of
these regions have a high solar
irradiation.
THANK YOU

Adio Stefoni
Business Development Manager
South America

astefoni@vectorcuatrogroup.com

+56 9 9887 5876