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CERAWeek: Márquez says Colombia needs to deliver on multi-faceted strategy to meet emissions goal

01 March 2021 Keiron Greenhalgh

Plans to cut Colombia's carbon emissions by more than 50% by 2030 are realistic, if it adopts and delivers on a complex, multi-faceted strategy, according to President Ivan Duque Márquez.

Speaking to IHS Markit Vice Chairman and Pulitzer Prize-winning author Daniel Yergin on the opening day of CERAWeek by IHS Markit, Márquez outlined a series of actions he said would put Colombia on that path: increase its renewable generation portfolio; clean up its transportation sector; protect the tropical rainforest; institute greater recycling; and ramp up its circular economy.

Non-conventional renewables accounted for 0.2% of the Colombian electricity mix when Márquez took power in August 2018. A grand total of 35 megawatts (MW), he said.

Currently, Colombia has 1 gigawatt (GW) of non-conventional renewables generation and expects to reach 2.5 GW by 2022, he said.

The country will hold auctions to build 4.8 GW of renewable generation capacity, which will be installed in the next five years, he said, and is set to hold its first energy storage auction.

Meantime, the country's electric vehicle (EV) sales jumped more than 70% year on year in 2020, Márquez said. Colombia introduced tax and commercial discounts for EVs in 2019.

180 million trees

Part of Márquez's plans for greening the country involves planting millions of trees to create a much larger carbon sink, or at least neutralizing deforestation.

Some 50% of Colombia is tropical forest, he said, with 35% of the nation in the Amazon Basin. A total of 50 million trees have been planted by the government as part of the scheme that will eventually see 180 million trees planted. Of those 180 million trees, some 100 million will be planted by the end of 2021, he said.

There has been a reduction in the rate of deforestation, but it needs to improve still further, Márquez said.

Márquez reminded Yergin of a conversation they had at the World Economic Forum annual forum in Davos, Switzerland, where he told the historian that "Colombia has the world's best technology possible to capture CO2 emissions." Trees are that technology, he told Yergin then.

And while Colombia is a mineral-rich country, with oil, natural gas, and, especially, coal reserves in abundance, in January, Márquez's Minister of Mines and Energy Diego Mesa told Davos Energy Week 2021 that another form of capture would leverage some of that wealth -- carbon capture and storage technologies.

There has to be balance in what happens, Márquez told Yergin. "We're not against oil," he said, adding that hydrocarbon producers could help with the transition, supporting renewables for instance.

State-owned Ecopetrol, the biggest oil and gas producer in Colombia, is going beyond oil and gas, he said. It is now the number one non-conventional power generation company in Colombia, he said, and plans to have 400 MW of installed unconventional generation by the end of 2021.

If traditional industries become users of renewables, it helps to mitigate their emissions, Márquez said, adding that he wants Ecopetrol and other industrial companies to become leaders. It "builds trust," he added.

Innovation

The development of trust is just as indispensable when developing any unconventional hydrocarbon resources, given the political issues swirling around the sector, particularly as the country's conventional oil and natural gas output declines. Oil and gas output at state-controlled Ecopetrol fell to 696,800 b/d of oil-equivalent in 2020 from 724,800 boe/d in 2019.

During another CERAWeek session on 1 March, Armando Zamora Reyes, president of Colombia's National Hydrocarbons Agency, said the country will expand production of hydraulically fractured oil and gas production. Reyes explained that sustaining the country's economy -- which is critical for the many initiatives that Marquez described --will require continued investment in the oil and gas industry, while shifting it to lower carbon emissions.

Colombia has looked at unconventional oil and gas, Márquez affirmed, bringing together all the parties, both the environmentalists and oil companies. Pilot projects have been created with transparency, he said, so that the technology, the impact on water and the earth's crust, as well as other potential issues can investigated. Once the information from the projects arrives, then it can be evaluated, and decisions can be made on whether to move forward in such areas, he added. So far this path has created trust, he said.

Even if this does not lead to wider exploration and production, Márquez is looking to other areas of innovation, he said, to bolster a country he will lead until next year. His four-year term ends in 2022 and, under Colombia's constitution, he cannot be re-elected.

Colombia is training 100,000 programmers so it can carry out a key Márquez strategy of digitalization. The head of state wants to see growth in the financial technology or fintech and healthcare technology sectors, among others, he said. Outsiders, he added, saw a human element missing when they looked at Colombia for investment, and the training scheme is one of a number of mechanisms aimed at fixing that misperception.

The coming years will see a fourth industrial revolution in Colombia, said Márquez, who wants to see 70% high-speed internet penetration by 2022.

Colombia has almost managed to return to pre-pandemic level of growth, and Márquez expects growth to be close to 5% in 2021.

Posted 01 March 2021 by Keiron Greenhalgh, Editor, Energy and Natural Resources Group, IHS Markit

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