Colombia’s Mission To Be A Global Leader In The Renewable Energy Space
A nation with a wealth of sustainable and renewable energy resources already up and running – and huge scope for growth through sustainable investment.
In 2015, the United Nations launched the 2030 Agenda for Sustainable Development, a plan to protect the earth’s environment and climate to ensure peace and prosperity for people across the globe. At its core are 17 Sustainable Development Goals (SDGs), ambitions which pledge to improve health and education, reduce inequality, and spur economic growth – all while tackling climate change.
As a major catalyst to development, foreign direct investment (FDI) plays an essential role in financing and accomplishing these sustainability goals, especially for developing countries. However, there’s currently an annual global deficit of approximately US$2.5 trillion in investment for SDGs in developing countries, intensified by the COVID-19 pandemic.
Recognizing this, the UN is hosting the COP 26 Climate Change Conference, an event that will not only accelerate action towards climate change but demonstrate the opportunities the energy transition can bring to developing countries.
Playing a key role in the negotiations at this summit is Colombia, a country that prides itself as one of the most bio-diverse per square meter in the world, and an international player in the renewable energy space.
Ripe for sustainable investment
Renewable energy has a big part to play for the future of developing countries, not just in the opportunity it brings for the environment, but to investors and those looking to support SDGs.
One of Colombia’s objectives is to attract FDI that will contribute to the country’s ambitious goal: the plight for a successful energy transition. As a country with all the right conditions for sustainable investment, there is bountiful opportunity and huge scope for growth.
According to the World Economic Forum, Colombia is ranked second for South America in the Energy Transition Index, no doubt thanks to expanding 50 times the installed capacity of alternative energy sources, from 50 megawatts (MW) in 2018 to a projected 2,500MW by 2022. The country also estimates that its clean and renewable energies share will grow from 1% in 2020, 17% in 2030, and to an impressive 25% in 2050.
For its region, Colombia is ranked first in both the FAO’s Food Sustainability Index and IMD’s World Competitiveness Yearbook for implementing ethical practices and sustainable development standards. Evidently, Colombia is ripe for sustainable investment and, additionally, has some ambitious plans in place to ensure it can accomplish its climate change targets for a successful energy transition. This includes achieving zero deforestation and a 51% reduction in Greenhouse Gas emissions by 2030 and carbon neutrality by 2050.
Conquering renewable energy goals
To realize its green objectives, Colombia is exploring the opportunities in solar, wind, and biomass energy. Key to this is a host of existing infrastructure projects, the technology that’s enabling them, and the Colombian government’s current actions in facilitating growth and innovation.
Already, Colombia’s renewable energy results have exceeded expectations. In 2019, power supply contracts were awarded, and developers committed to investments totalling $2 billion. The Colombian government is also integrating new clean energy technologies such as hydrogen, offshore wind, and geothermal energy to help attain climate goals.
Green hydrogen in particular is a favorable alternative for Colombia’s energy future. The government recently launched a 30-year hydrogen roadmap, which was the first to bring hydrogen-based technologies to the country’s energy mix. With ideal conditions for such production, Colombia’s primed to become a competitive exporter in the international fuel market.
Colombia’s other recent sustainability achievements include the world’s first double-sided auction for renewable energy in 2019, which comprises 14 solar and wind projects with over 1,300MW of installed capacity, creating 6,000 jobs and investments totalling $2.26 Billion.
With no sign of slowing down, the country plans a third auction in 2021 with a projection of over 80 solar and wind projects. This is expected to bring in investment of around $6.8 Billion and up to 32,000 new jobs.
A catalyst for global change
While Colombia’s accomplishments within sustainability are set to boost FDI for the country, these efforts will naturally have a significant impact on the environment, too, resulting in cleaner air and reducing the contribution to earth’s fossil fuels.
Colombia’s commitments to renewable energy won’t only bring about benefits for the country, but they’ll help it to lead by example, demonstrating to other developing nations what’s possible when sustainability is prioritized.
