Colombia's CREG calls auction for firm power supply in 2027-2028

Colombia’s power and gas regulator CREG on Thursday launched the so-called reliability charge auction, a scheme devised to ensure that the hydro-dependent country can count on a stable and reasonably-priced supply of electricity during expected periods of droughts.

The power supply period covered by this auction will start on December 1, 2027 and finalise on November 30, 2028, according to the announcement.

The CREG invited power generators, project developers, investors and commercial agents representing existing or new power plants to participate in the auction. Promoters of generation projects that are not constructed yet need to demonstrate that they have a grid connection in place and that their power plant can be commissioned on time.

Selected power plants or projects will be awarded firm energy obligations, or OEFs, at a price determined in the auction. With OEFs, power generators take on the obligation to ensure the continuous provision of service during droughts, or critical periods for the system, to all consumers connected to Colombia’s national grid, the CREG said.

The regulator did not say whether non-conventional renewables are eligible to participate, but it did not explicitly say that they cannot. Interestingly, it illustrated the invitation with an image depicting a wind farm, a solar PV farm and a large-scale hydroelectric plant.

Moreover, in the third reliability charge auction in 2019, wind and solar projects totalling 1,398 MW secured OEFs.

This type of auctions was first introduced in December 2006 with a goal to protect consumers against high prices expected during dry seasons and to ensure a steady flow of electricity into the grid.

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