El Niño phenomenon will increase energy rates, says Minminas

The arrival of El Niño phenomenon It has raised alarm bells in the electricity sector in light of the possible impacts it could have on the system. Especially in service fees.

Faced with this situation, the Minister of Mines and Energy, Irene Vélez, spoke on the subject and confirmed that This climatic event will impact electricity prices in some regions of the national territory.

(See: Minenergía analyzes options to recover tariff option balances).

To explain why this increase would occur, the minister highlighted that In the country, the largest percentage of energy used is generated through hydroelectric plants. In the event of a possible shortage due to droughts, the demand would be covered by the thermoelectric plants.

“We have a matrix in Colombia where 70% is hydraulic and 30% is thermal, under normal conditions, but when water becomes scarce, that is, the El Niño phenomenon, stress is generated that leads us to consume more thermoelectric”he pointed.

(See: Six energy companies face risks due to the El Niño phenomenon).

As explained by the Minergía, the local electricity market scheme implies that when more expensive technologies are used for power generation there is an impact on electricity service values.

So, when there is a greater demand for the thermal supply, “Then the price configuration does indeed impact and that price of the thermoelectric plant depends on the type of energy used for generation, which can be coal, liquid and gas”.

Hydroelectric power

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On the other hand, the head of the energy portfolio added that, from the impact on prices derived from the use of thermoelectric plants, markets that are more exposed on the stock market could be affected.

In this sense, the regions in which electricity rates could rise are: Putumayo, Huila and Cauca.

(Read more: They issue new guidelines for the provision of energy service).

Before this panorama, Vélez indicated that the Government is insisting on the promotion of tariff justice. With the signing of Decree 0929, the Executive seeks to promote the efficiency and competitiveness of the public electric power service

The above includes “the power to generate a better valuation of the thermal resource and the water resource”.

BRIEFCASE