The Colombian electricity market has four activities: generation and commercialization are in free competition, while transmission and distribution are treated as regulated monopolies. In addition, there are other actors who must be considered for their importance and influence in the market: big consumers, the operator and market manager, and government entities. Energy is traded through bilateral contracts (OTC) and daily short-term offers that are bidded in the energy spot market. Big consumers are those who have consumptions equal or higher than 55 MWh per month in energy or power levels above 0.1 MW.
Market Design
How is the market structured?
The Colombian electricity market has four activities: generation and commercialization are in free competition, while transmission and distribution are treated as regulated monopolies. In addition, there are other actors who must be considered for their importance and influence in the market: big consumers, the operator and market manager, and government entities. Energy is traded through bilateral contracts (OTC) and daily short-term offers that are bidded in the energy spot market. Big consumers are those who have consumptions equal or higher than 55 MWh per month in energy or power levels above 0.1 MW. Commercial agents and big consumers act by signing electricity supply contracts. The price of electricity in this market is established by agreement among the parties, without the intervention of the State. The operation and market management is carried out by XM, which is responsible for the functions of an ISO, Administrator of the Commercial Interchange System ASIC and Liquidator and Account Manager of Charges for Use of Networks of the SIN-LAC.
What are the geographic boundaries of the market?
Colombia and the International Short-Term Electricity Transactions with Ecuador.
What are the relevant price and delivery zones?
Spot market price. Congestion and technicial restrictions are resolved in a specific within-day market and the costs of managing those constraints is recovered uniformly across all users of the system.
Can I buy long-term power in the traded markets?
Yes, there are no time limits to OTC and financial contracts among customers and commercial agents with only one exception in the wholesale market: contracts directed to regulated end-users.
Who do I need to contract with to buy power?
End-users must buy their power from an electricity supplier (commercial agent) unless the power is generated on-site.
How are system costs and other social charges levied?
Network charges and other system costs are charged to electricity suppliers (commercial agents) who pass these through to end users
How do I prove I've bought renewable power?
In Colombia, renewable generation is certified using Carbon Certificates (CER). CERs are issued by the designated National Accreditation Agency (ONAC) for every MWh of eligible renewable output.
These certificates could be used by customers to cut down their National Carbon Tax.
How are RECs procured? We dont buy RECs, we are offering RECs from our plants: Amoya and Sogamoso.
Are Renewable PPAs available? Yes
Are Green Tariffs available? No
What are the key institutions?
Regulator:
- Energy and Gas Regulatory Commission (CREG)
Key Government Department:
- Ministry of Mines and Energy
System Operator:
- XM
Power Exchange:
- Spot market
- Total Capacity
- Total Generation
Total
Capacity
17 GW
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