After months of regulatory uncertainty and questions about the system's ability to respond to future episodes of energy stress, Colombia finally managed to award 4069.7 MW in its fifth auction of Firm Energy Obligations (OEF) of the Reliability Charge, of which 1792.9 MW were for renewables.
However, the outcome also exposed a political contradiction, despite the fact that sufficient commitments were allocated to cover the target demand.
Tensions escalated rapidly when President Gustavo Petro publicly questioned the approval of a gas-fired power plant, pointing directly at his Minister of Mines and Energy, Edwin Palma , in a move that revealed internal divisions within the Executive branch.
Palma himself responded and defended the process, assuring that the results are positive for the country's energy security for the next supply period.
Sources close to the sector assure that the presidential discontent was not limited to the public sphere (typical of the electoral calendar of May 31), but also included internal questioning of the result of the process.
What did the auction reveal?
Non-conventional renewable energies (NCRE) achieved a significant share in terms of installed capacity, with 31 solar and wind projects awarded for almost 1800 MW , representing about 45% of all the power allocated in the call , which totaled just over 4 GW also considering hydroelectric and thermal power .
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While the awarded commitments, which in some cases extend until 2049, total more than 4 GW of power if hydroelectric and thermal power plants are also considered .
However, the most contentious aspect is political and conceptual, because the renewable component was significant in terms of megawatts awarded, and the picture changes when the firm energy actually committed is analyzed.
The mechanism allocated around 143 GWh/day , but the solar contribution represents only about 8% of that total , while wind power has virtually no weight within the firm energy awarded.
This fact explains part of the conflict: renewables are gaining prominence in installed capacity, but the reliability of the system still relies mainly on traditional firm technologies.
Therein lies a structural tension that goes beyond this auction: the system may need firm support while variable renewable penetration continues to grow, but politically that argument clashes with a discourse that seeks to accelerate the exit from fossil fuels.
The situation worsened with the controversy surrounding the project associated with Nencol and Termoinduenergy, which triggered further political questions. According to the journalistic investigation published in Colombia, the project became the focus of debate following presidential criticism and the subsequent institutional defense of the awarding mechanism.
The episode also revealed that the controversy could extend beyond strictly energy-related issues. Within the market, some sources consulted interpret the political unrest as stemming from tensions related to the May 31st election calendar and questions about the close ties between actors involved in the awarded project and sectors close to Iván Cepeda 's campaign.
The Ministry insisted that the process responds to automated technical parameters and not to discretionary decisions.
In short, Colombia managed to unlock a key auction for the electricity system, but the political price of that progress could be reflected in future regulatory decisions.