Colombia's energy supply is predominantly renewable, with a significant portion derived from hydroelectric sources. However, this reliance on natural resources, especially water, makes the energy system vulnerable to climate change and variations in precipitation. To mitigate these risks, it is crucial to develop and integrate other renewable energy sources into the energy mix to ensure a more resilient energy system. Improving energy efficiency across all sectors is also an important factor.
Despite the relatively clean energy mix, Colombia still exhibits a strong dependence on fossil fuels. The national economy relies heavily on the export of coal, which has created resistance to stricter climate policies. Under President Gustavo Petro, Colombia has now halted new hydrocarbon exploration contracts for the exploitation of fossil fuels. This decision presents the country with economic challenges, as the halt in exploitation leads to a significant reduction in state revenues and potentially negative impacts on foreign direct investment. Instead, a balanced and gradual energy transition should be pursued to ensure economic stability and the availability of necessary financial resources for investments in clean energy. Additionally, the lack of a medium-term transition strategy to replace revenues from fossil fuels could severely impact Colombia's economic stability. Therefore, the energy transition must be accompanied by reindustrialization policies and export diversification. Furthermore, a medium-term transition plan is also needed for the expansion of renewable energies: natural gas is identified as a suitable transitional energy source, as it is cheaper and cleaner than oil and coal.
For achieving a sustainable energy transition in Colombia, it will be crucial to foster collaboration among government, private sector, and civil society, and to create financial and regulatory incentives for renewable energy investments. International cooperation for technology transfer and financing will also be needed in order for the transition to be successful. While the fossil fuel phaseout is imperative, this Sustainability Monitor highlights the importance of a balanced and gradual shift away from fossil fuels to mitigate economic risks and ensure a resilient and sustainable energy transition in Colombia.
