Energy in Colombia Emerging Consumption Needs Analysis¶
Impact of Behavior Changes¶
Based on the analysis of ongoing behavior changes in the Colombian energy sector, several key impacts on consumption behavior and the emergence of specific consumption needs can be identified, influencing different stages of the energy value chain in 2024 and 2025.
The increasing tendency of large commercial and industrial users within the non-regulated market to negotiate direct energy supply contracts, such as long-term Power Purchase Agreements (PPAs) for electricity and tailored gas agreements, signifies a notable shift in consumption behavior. [Source 1, Source 4, Source 6, Source 8] This moves away from reliance on volatile spot market purchases towards prioritizing price stability and predictability in their energy costs. [Source 1] This behavior directly impacts the Commercialization and Generation segments, as commercializers need to adapt their offerings to provide these long-term, customized solutions, and generators benefit from the predictable demand these contracts provide, aiding the financing of new projects, particularly in renewable energy. [Source 1]
Conversely, the persistent behavior of high non-technical losses among residential and small commercial users in certain areas, notably the Caribbean coast, presents a different kind of impact. [Source 1] While this behavior does not change the fundamental need for energy, it severely disrupts the commercial relationship within the Distribution and Commercialization segments. [Source 1] It leads to financial strain for distribution companies, necessitates significant investment in infrastructure and anti-fraud measures, and results in higher costs for compliant, regulated customers. [Source 1] This highlights an underlying, though challenging, need for reliable and affordable energy delivery that is complicated by socio-economic factors and illicit consumption behaviors.
The broader industry push towards integrating renewable energy sources, like solar and wind, driven by investments from players such as Celsia and Ecopetrol's strategic initiatives, is influencing the available energy mix. [Source 1, Source 3, Source 7] While the reports do not provide direct data on changing customer preferences for renewables, the increasing availability inherently creates the potential for an emerging consumption need for "greener" energy options, particularly for non-regulated customers who have more flexibility in choosing their energy source based on sustainability goals or corporate image.
Furthermore, the impact of societal and community behavior, specifically opposition to new infrastructure projects (pipelines, transmission lines, power plants), though not a change in consumption behavior itself, significantly affects the supply side of the value chain. [Source 1] By causing delays and increasing costs in Exploration & Production, Midstream, Transmission, and Generation, this behavior implicitly impacts future consumption by potentially limiting the availability, reliability, and cost-effectiveness of energy supply delivered to all customer segments.
Based on these observed behaviors and their impacts, several emerging consumption needs can be identified:
- Need for Price Certainty and Predictability: Especially among large commercial and industrial users seeking to hedge against energy market volatility through long-term contracts.
- Need for Tailored Energy Solutions: Large energy consumers require customized supply agreements and services that align with their specific operational requirements, risk management strategies, and increasingly, sustainability objectives.
- Need for Greener Energy Options: Driven by the energy transition and a growing awareness or requirement for energy from renewable sources. This creates a demand for commercializers to offer renewable energy products and for generators to increase renewable capacity.
- Need for Improved Reliability and Reduced Losses in Distribution: Particularly evident in areas with high non-technical losses, there is a fundamental, yet challenging, need for more reliable service and a reduction in costs unfairly borne by paying customers due to theft and fraud.
The table below summarizes the potential impact of these ongoing behavior changes across the energy value chain stages:
| Value Chain Stage | Impact of Ongoing Behavior Changes |
|---|---|
| Exploration & Production | Impacted by societal opposition, potentially limiting access to new reserves and increasing project costs and delays. Long-term hydrocarbon demand potentially influenced by energy transition trends. |
| Midstream (Hydrocarbons) | Faces challenges from infrastructure security threats and potentially reduced long-term transport demand if hydrocarbon production declines or energy transition accelerates. Affected by societal opposition delaying new pipeline projects. |
| Transmission (Electricity) | Significantly impacted by delays in infrastructure development due to social/environmental opposition, creating bottlenecks for evacuating new generation capacity, particularly renewables. Requires modernization to integrate variable renewable sources, impacting operational complexity. |
| Downstream (Hydrocarbons) | Long-term demand for refined products could be influenced by the energy transition and potential shifts towards electric mobility or other cleaner energy sources. |
| Generation (Electricity) | Benefits from increased demand for long-term contracts (PPAs) from large B2B users, providing revenue stability for new projects, especially renewables. Faces challenges in integrating variable renewables due to transmission constraints. |
| Distribution (Energy) | Heavily impacted by non-technical losses in certain regions, leading to financial strain, need for infrastructure investment, and challenging customer relationships. Requires adaptation to manage distributed generation from renewables. |
| Commercialization (Energy) | Experiences a shift in relationships with large B2B customers towards direct negotiation and long-term contracts. Faces operational and financial challenges in serving regulated customers in areas with high non-technical losses. Needs to adapt service offerings to include new energy sources like renewables. |
References¶
Energy Analytics Institute (EAI). reporte-4t23-ecopetrol-eng. (2024-03-01). https://energy-analytics-institute.org/reporte-4t23-ecopetrol-eng/ [Source 1] LaNota.com. Ranking 2024 sector energía eléctrica de Colombia. (2024-12-05). https://lanota.com/ranking/Ranking-sector-energia-electrica-Colombia.php [Source 2] GlobalData. Celsia SA ESP Company Profile. https://www.globaldata.com/company-profile/celsia-sa-esp/ [Source 3] Infobae. Ahora EPM es la segunda después de Ecopetrol: así quedó el ranking de las empresas con mayores ingresos en Colombia. (2024-03-26). https://www.infobae.com/colombia/2024/03/26/ahora-epm-es-la-segunda-despues-de-ecopetrol-asi-quedo-el-ranking-de-las-empresas-con-mayores-ingresos-en-colombia/ [Source 4] Las2orillas.co. Los 4 grandes que más han ganado con la energía eléctrica en Colombia. (2022-09-19). https://www.las2orillas.co/los-4-grandes-que-mas-han-ganado-con-la-energia-electrica-en-colombia/ [Source 5] Stock Analysis. Organización Terpel S.A. (BVC:TERPEL) Stock Price & Overview. https://stockanalysis.com/bvc/terpel/ [Source 6] ColombiaOne.com. Top Ten Largest Companies in Colombia. (2024-01-20). https://colombiaone.com/top-ten-largest-companies-in-colombia/ [Source 7] Investing.com. Celsia SA (BVC:CELSIA) Revenue. https://www.investing.com/equities/celsia-revenue [Source 8] Macrotrends. Ecopetrol S.A Revenue 2010-2024 | EC. https://www.macrotrends.net/stocks/charts/EC/ecopetrol-s.a/revenue [Source 9] LaNota.com. Ranking 2022 sector energía eléctrica de Colombia. (2023-10-18). https://lanota.com/ranking/Ranking-sector-energia-electrica-Colombia-2022.php [Source 10] Stock Analysis. Organización Terpel (BVC:TERPEL) Revenue. https://stockanalysis.com/bvc/terpel/revenue/ [Source 11]