Wärtsilä awaiting new auction to advance 500MW Colombia portfolio

Wärtsilä Colombia is awaiting a new auction for electricity supply contracts to move ahead with plans to develop 500MW of thermoelectric power capacity in the Andean country, managing director Roberto Lares told BNamericas. 

The projects include a proposed expansion of the El Tesorito plant in Córdoba department and the Termo Bonda, Termo Gaira and Termo Costa power stations in Santa Marta. 

"We are always available as possible suppliers of equipment and construction," Lares said in a telephone interview. 

"It is an advantage for us as a company. We can do the complete EPC of the plant. There is never 100% security until you have the contract, but we are supporting those four projects that together total about 500MW."

Experts have warned that Colombia must increase its thermal power capacity to guarantee future electricity supply due to the intermittency of renewable energy and the vulnerability of hydroelectric dams to drought. 

Developments can only move forward, however, if Colombia holds another auction that allows for greater participation from thermoelectric generators. 

At a reliability charge auction for firm energy obligations in February, only 48MW of the 4,489MW that were assigned contracts corresponded to gas-fired power. The remainder was awarded to solar developers. 

"In essence, thermoelectric developers are waiting for an expansion auction for reliability charges," Lares said. "And it is true that in Colombia these auctions are not very frequent. They occur once every four or five years."

"It is good to clarify that there is high interest in Colombia, both from developers and investors, which is very positive. That is to say, the moment the conditions for a new auction are met and the connection points are placed or granted, there will surely be [thermal] projects, just as in the renewable world, with very serious investors behind them."

In April, energy minister Andrés Camacho said the government was preparing a new auction for standby energy to alleviate fears of a future supply deficit.

The new bidding process would be held under the so-called "reconfiguration auction" modality, which is used when projected supply falls short of expected demand. 

Camacho also raised the prospect of source-specific energy tenders for different regions of the country. 

The full interview with Lares will be published in the coming days.