Colombia plans regulatory push for geothermal development

Colombia plans regulatory push for geothermal development Capitol Bogota, Colombia (source: flickr/ eduardozarate, creative commons)
Alexander Richter 16 May 2022

Colombia's Ministry of Mining and Energy has announced regulatory changes to geothermal providing same tax benefits currently available to solar and wind among others.

The Government of Colombia is ready to issue the regulations that stimulate the development of energy generation projects taking advantage of the geothermal resources available in the country. This was announced by Diego Mesa, the Minister of Mines and Energy, in a speech at the Sustainability Facts Forum, organized by the Colombian Oil and Gas Association (ACP), in the city of Barranquilla last week.

According to the official, this is a new step in the execution of the roadmap designed to advance the energy transition, and stimulate the use of generation sources other than hydrocarbons and coal.

The objective of the regulation is that geothermal generation projects have the same tax benefits as solar or wind initiatives.

He also mentioned that a technical component associated with a registry will be included that allows locating possible geothermal developments, thinking that there may be “coexistence” in case there is an overlap of these with other types of projects.

Mesa commented that among the benefits there is a 150% over-deduction of investments against income tax, that is, for every million pesos invested in this type of project, $1.5 million can be deducted in the income statement, for a period of 15 years.

Likewise, a VAT exemption was incorporated for the importation of equipment and other benefits that are enshrined in the Energy Transition Law.

The minister added that after promulgating the regulations for geothermal projects, another step will be that of hydrogen initiatives, of which the first pilots are advancing.

Source: El Colombiano