ENERGY TRANSFORMATION

Colombia 2020 | ENERGY | INTERVIEW

Colombia has taken important steps for its energy transition and is speeding up the use of non-conventional renewable sources to provide cleaner and sustainable energy for all.

María Fernanda Suárez
BIOGRAPHY

María Fernanda Suárez is a business administrator of Colegio de Estudios Superiores de Administración (CESA) where she graduated with honors and has a master's in public policy management from Georgetown University. She has more than 20 years of experience in the public and private sectors. From 2015 until her appointment, she served as vice president of strategy and finance for Ecopetrol. In addition, she was director of public credit and national treasury of the Ministry of Finance. Prior to her experience in the public sector, she served in the private sector as vice president of investments in the Porvenir Pension Fund and executive in Citibank, ABN AMRO, and Bank of America. In addition to her competitive career, she has been a member of the board of directors of several companies.

What have been your main focus areas and achievements during this administration?
Colombia's electricity generation matrix is one of the cleanest in the world. Nearly 70% of the electricity that Colombians consume is generated through hydropower, while 30% is generated through thermoelectric plants. At the same time, we have an objective to reduce our CO2 emissions by 11.2 million tons through 2030. Over the last 19 months in government, Colombia has taken very important steps for our energy transition and speeding up the use of non-conventional renewable sources. This will allow us to provide cleaner, more efficient, and sustainable energy for Colombians while at the same time continuing to close the existing inequality gaps.

How relevant will clean energy resources be for future energy generation in Colombia?
Electricity, specially generated through non-conventional renewable sources, and natural gas will continue to be the drivers of Colombia's energy transformation. That's envisioned in the National Energy Plan, a tool developed by the Mining and Energy Planning Unit (UPME), which presents possible future supply and demand scenarios in the country through 2050. According to the UPME report, electricity and natural gas demand will surpass that of liquid fuels. Currently, nearly 48% of the energy consumed in the country are liquid fuels, while natural gas and electricity represent 30%. According to our estimates, in 2050 that participation will reverse: natural gas and electricity demand will be of 46%, while that of liquid fuels will near 36%. Colombia, particularly the Caribbean region, has a huge potential for energy generation through non-conventional sources. Wind speed in La Guajira is twice as much the global average, while solar radiation there is 60% higher.

What actions can be taken by the government to further promote development of renewable energy resources?
Energy transition in Colombia is a reality. The country has taken a historical leap toward renewable energies, which will allow us to generate more than 12% of our electricity from solar and wind power by 2022. We will go from having less than 50MW of installed capacity for solar and wind generation, which are equivalent to the capacity that a city the size of Ibague requires, to more than 2,500MW in 2022, which the amount collectively needed by cities such as Cali, Medellín, Bucaramanga, Barranquilla, and Cartagena. That will be achieved through 14 generation megaprojects, reducing CO2 emissions by 9 million tons, attracting over COP8 trillion in investment, more than 6,000 jobs, and a 30% reduction in electricity rates for consumers.

What opportunities do comprehensive research pilot projects (PPII) represent for Colombia?
PPIIs are an experimental and scientific process that will be developed to evaluate the effects of techniques with horizontal drilling for non-conventional fields. If these projects are successful and these resources could be further developed, experts estimate there could be between 35 and 50 additional years of gas reserves and 15 more for oil. No other source has such potential levels.

What role do you envision the energy and mining sectors playing in the future of Colombia's economy?
The mining-energy sector is an important revenue source for the country; 7% of the country's GDP corresponds to mining, hydrocarbon, and energy activities, and 12% of the current income for the country between 2015 and 2018 were generated through oil revenues. Nearly 38% of the FDI in the country is related to that industry, and 56% of the exports in Colombia in 2019 correspond to mining-energy resources. Additionally, the sector provides resources that boost economic and social development in regions, through the general royalty system, which for 2019 and 2020 totaled COP24.2 trillion, which is the highest amount since its creation in 2012.

What are the priorities of the ministry moving forward?
Our goal is to achieve a more efficient, reliable, and sustainable energy service. The experts of the Energy Transformation Mission have delivered a number of recommendations to our country, which are focused such issues as achieving a higher reliability in the energy supply for all Colombians at more efficient prices and increasing the offer and demand of natural gas by increasing the participation of generation plants, which currently has a participation of less than 12%. Other focuses include empowering energy users through the introduction of technologies, like smart meters, which will allow to make better decisions around consumption, control spending, or concerning the environment, and further focusing on energy subsidies. This, could contribute toward closing equity gaps and bring energy to more than 500,000 families who do not currently have access. In 2019, we connected more than 27,000 of these families to electric power for the first time, and our goal is to connect at least 100,000 families. Finally, we must strengthen and modernize the institutions and companies in the sector and achieve a higher level of coordination, which will allow us to respond to the new challenges in the electricity sector. Through these initiatives, the national government is working to develop a transformation roadmap that takes into account the expert recommendations, unions, businesses, and other players in the energy sector.