Colombia releases regulations on utlisation of geothermal energy

Colombia releases regulations on utlisation of geothermal energy Diego Mesa, Minister of Mines & Energy and Daniel Ferreiro, President of Parex Resources (source: Ministerio de Minas y Energía, Colombia)
Alexander Richter 5 Aug 2022

Colombia releases regulatory scheme for licensing of exploration and exploitation permits for geothermal energy for power generation, as well as a geothermal registry.

Last month, the Colombia Ministry of Mines and Energy (Ministerio de Minas y Energía) issued a series of decrees that regulate articles 14, 15, 21 and 23 of the Energy Transition Law.

The first degrees sets up an institutional framework for the development of the hydrogen market in the country. The second decree establishes the geothermal registry and the procedures for requesting geothermal exploration and exploitation permits for power generation purposes, their duration, and the activities that are included in the geothermal exploration and exploitation phases in the country.

“The new regulation includes guidelines for the development and export of zero and low-emission hydrogen in the country, as well as the regulation for the development of activities aimed at generating electricity through geothermal energy. From the beginning of the Government we set out to diversify the country’s energy matrix and today we are leaving Colombia with one of the most sustainable matrix in the world”, said the Minister of Mines and Energy, Diego Mesa.

In terms of hydrogen, the new regulation establishes the institutional framework for the development of the market for this energy source in Colombia, defining the powers of the different ministries that play an important role in the economy of this new energy vector.

Similarly, the decree establishes guidelines so that the Ministry of Environment and Sustainable Development and the Ministry of Mines and Energy define key issues for the future export of sustainable hydrogen, such as the definition of certificates of origin. Likewise, these ministries will be in charge of defining the emission threshold allowed to catalog low-emission hydrogen, in order to continue promoting alternative hydrogen production technologies that contribute to the decarbonization of the country.

Another of the key issues defined by the decree is the creation of an information reporting system for the hydrogen market, with the aim of organizing and obtaining systematized information on the different activities of the value chain at the national level.

The decree also provides guidelines for entities, according to their powers, to analyze issues such as: hydrogen storage, innovation promotion programs and regulatory sandbox (This instrument will allow entrepreneurs to explore innovative business models in regulated industries)

On the other hand, in terms of geothermal energy, the second decree defines the procedure for requesting exploration and exploitation permits and their registration in the geothermal registry, their duration, the activities that are included within the phases of exploration and exploitation of the resource, the information that the developer must report, the rules for overlapping projects and their transfer, as well as the sanctioning regime.

>> a short take by a Colombian laywer (in Spanish)

With the issuance of this regulation, legal certainty will be given to investors and the development of electric power generation projects with geothermal sources will be promoted, while knowledge of the Colombian subsoil is increased.

It is worth remembering that this Government managed to inaugurate the first two green hydrogen production pilots in the country (located in Cartagena), as well as the first electricity generation projects through the use of geothermal energy (located in Casanare).

Colombia has seen the development of small-scale geothermal power generation projects in oil development, as we have been reporting.

Rank ORC unit in Colombia (source: Diego Mesa, Ministro de Minas y Energía de Colombia)

Source: Ministry release July 2022