Colombia is one of the main energy producers in the world, yet it produces much more than their needs. The difference between energy production and consumption has been mainly due to exports of oil and coal. Colombia's energy demand has been increasing over the last decade and is expected to grow by an average of 3.5% per year until 2020.
Colombia has long relied on an abundant supply of hydropower, fossil fuels, oil, coal and gas to meet domestic energy needs as well as contributing substantially to the balance of trade in international markets. The situation is about to change with the loss of self-sufficiency in oil announced forecast for 2010-2011 and similar difficulties in extending reserves of natural gas and its distribution network.
Also, the potential for hydroelectricity, the source of energy Colombian biggest power generation in the country, is facing difficulties in increasing capacity. These challenges include the extension of environmental and social costs associated with large projects and potential impacts of climate change and climate variability (dramatic increases in surface temperature in the Andes, changes in rainfall patterns and increases in intensity and frequency oscillation signals that drive El Niño periods of drought). Moreover, the country is well endowed with wind and solar energy resources must participate in a meaningful way in the energy mix of the nation.
The optimization of the energy future of the nation requires a competent review of several alternatives. Among other things, the country could i) increase production of hydropower, with additional safety margins to cope with climate considerations, ii) increasing use of coal for domestic energy generation and synthetic fuels, iii) increasing reliance on renewable energy sources and conventional biomass for liquid fuel production, or iv) a combination of some or all of these.
Colombia has also been one of the first in the Clean Development Mechanism (Clean Development Mechanism - CDM), under which both have promoted its first wind energy facility (Jepirachi) as the first-of-river project (Amoy) .