What's Driving Colombia's Current Energy Crisis?

Colombia faces a severe energy crisis characterized by rapidly depleting natural gas reserves, declining production, and increasing vulnerability of the power grid. This crisis stems from a combination of policy decisions, underinvestment in exploration, and growing dependence on hydroelectric power amid climate challenges.

Natural gas production has plummeted to historic lows, reaching just 800 million cubic feet per day in August 2025—a 16% year-over-year decline according to Colombia's National Hydrocarbons Agency (ANH). This production level falls significantly below the one billion cubic feet daily threshold that energy experts have long maintained is necessary for economic viability in the sector.

The situation represents a critical juncture for Colombia's energy future and economic development, threatening both energy security trends in a country already grappling with social and political tensions.

How Severe is Colombia's Natural Gas Production Decline?

Record Low Production Levels

Colombia's natural gas production has reached its lowest level in over a decade at 800 million cubic feet per day in August 2025. This represents a dramatic 16% decline from the previous year and approximately 33% less than production levels in 2013, according to data from Colombia's National Hydrocarbons Agency.

This shortfall is particularly concerning as it has pushed Colombia below the critical threshold of one billion cubic feet per day that industry experts consider necessary for maintaining economic viability in the sector.

Dwindling Reserves Crisis

The reserve situation is equally alarming. Colombia's proven natural gas reserves stood at just under 2.1 billion cubic feet at the end of 2024—a 13% decrease from the previous year and the lowest level in more than a decade, according to the National Hydrocarbons Agency.

At current production rates, these reserves are projected to last only 5.9 years, creating an urgent timeframe for Colombia to address its energy transition challenges.

Reserve Replacement Failure

Over the past decade, Colombia has consumed approximately 4,628 billion cubic feet of natural gas but has only replaced about 824 billion cubic feet of reserves, according to data from El Colombiano. This represents just an 18% replacement rate, highlighting a fundamental sustainability problem in Colombia's energy sector.

The reserve replacement ratio continues to deteriorate due to insufficient exploration drilling and lack of significant new discoveries, creating a downward spiral effect on the country's energy security.

Why is Colombia's Energy Mix Particularly Vulnerable?

Hydroelectric Dependence and Climate Volatility

Colombia generates approximately 58% of its electricity from hydroelectric plants, according to the International Energy Agency, making the power grid highly susceptible to climate fluctuations. When water levels drop due to drought conditions, as experienced during the severe El Niño-induced drought from 2023 to early 2025, electricity production from hydro sources decreases significantly.

This vulnerability creates a domino effect: as hydroelectric output falls, greater pressure is placed on natural gas-fired power stations to fill the gap—precisely when domestic gas production is reaching historic lows.

Power Grid Strain and Reliability Issues

The combination of hydroelectric vulnerability and natural gas shortages has led to increasing strain on Colombia's power grid. Brownouts and blackouts have become commonplace in many regions, particularly during periods of limited rainfall.

The situation became so dire during the 2023-2025 drought that Bogota's mayor Carlos Galán was forced to implement water rationing measures, as reported by Reuters, highlighting the interconnected nature of the country's water and energy challenges.

How Has Government Policy Impacted the Crisis?

Exploration Ban and Its Consequences

President Gustavo Petro's administration has implemented policies that have exacerbated the natural gas shortage. After taking office in August 2022, Petro ceased awarding new oil and gas policy shift as part of a broader agenda to reduce Colombia's dependence on fossil fuels and extractive industries.

This policy decision has had significant unintended consequences for energy security. Without new exploration, Colombia cannot discover and develop the natural gas fields needed to offset declining production from mature fields.

Transition Policies vs. Energy Security

The administration's focus on transitioning away from fossil fuels comes at a time when natural gas is globally recognized as a transition fuel due to its lower carbon emissions compared to other fossil fuels. This policy disconnect has created a situation where Colombia is reducing domestic natural gas production without having sufficient renewable energy capacity to fill the gap.

The result is increased dependence on imported energy sources, contradicting the goal of energy sovereignty and creating economic challenges.

What is the Impact of Increasing LNG Imports?

From Self-Sufficiency to Import Dependence

After decades of self-sufficiency in natural gas, Colombia began importing liquefied natural gas (LNG) in 2016. Initial imports that year totaled 429 million cubic feet, according to the International Energy Agency, but the situation has deteriorated rapidly since then.

According to data from S&P Global, Colombia's LNG imports reached a record high of 94 billion cubic feet in 2024—nearly triple the 36 billion cubic feet imported the previous year. Imported LNG now accounts for approximately one-fifth of all natural gas consumed in Colombia.

Rising Import Costs and Economic Impact

The shift from self-sufficiency to import dependence carries significant economic costs. LNG imports require hard currency expenditures and expose Colombia to international market price volatility. These additional costs ultimately affect consumers and businesses through higher energy prices.

The economic impact extends beyond direct energy costs to affect Colombia's balance of payments, currency stability, and overall economic competitiveness.

Future Import Projections

According to the Colombian Natural Gas Association (Naturgas), the situation is expected to worsen significantly in the coming years. The industry association projects that by 2029, Colombia will need to import 56% of all natural gas consumed domestically.

Naturgas attributes this growing shortfall primarily to falling domestic supply rather than rising demand, emphasizing that the root cause is insufficient exploration and development of new natural gas fields.

How Does the Crisis Affect Colombia's Power Generation?

Emergency Measures During Drought

The severe drought from 2023 to early 2025 forced the Colombian government to dramatically increase LNG imports to fuel three gas-fired power plants in the country's north. This emergency measure was necessary to boost electricity generation as hydroelectric output plummeted.

While effective as a short-term solution, this approach highlighted Colombia's growing vulnerability to climate events and the lack of resilience in its energy system.

Long-term Power Generation Challenges

Even with the drought having ended, Colombia faces long-term challenges in ensuring reliable power generation. The combination of declining domestic gas production and climate-vulnerable hydroelectric capacity creates a persistent risk of energy shortages.

Without significant investment in both natural gas exploration and diverse renewable energy sources, Colombia's power generation capacity will remain precarious and potentially insufficient to meet growing demand.

What Solutions Could Address Colombia's Energy Crisis?

Balanced Exploration and Transition Policies

A more balanced approach to energy policy could help address Colombia's crisis. This would involve reconsidering the ban on new exploration contracts while simultaneously accelerating investments in renewable energy.

Natural gas could serve as a bridge fuel, providing energy security during the transition period while Colombia builds up its renewable capacity.

Diversification of Energy Sources

Reducing dependence on hydroelectric power by developing a more diverse energy portfolio would enhance resilience to climate fluctuations. Solar, wind, and geothermal energy could complement hydroelectric and natural gas generation.

This diversification would require significant investment but would provide long-term benefits in terms of energy security and sustainability.

Infrastructure Investment

Upgrading and expanding energy infrastructure—including transmission lines, storage facilities, and LNG import terminals—would improve efficiency and reliability in the energy system.

Better infrastructure would also facilitate the integration of renewable energy sources into the grid, supporting the transition to a more sustainable energy mix.

What Are the Economic Implications of Colombia's Energy Crisis?

Industrial Competitiveness

Reliable and affordable energy is essential for industrial competitiveness. Colombia's energy crisis threatens to undermine the competitiveness of energy-intensive industries, potentially leading to reduced output, job losses, and economic contraction.

The impact is particularly concerning for manufacturing and resource processing industries that rely heavily on natural gas as both an energy source and feedstock.

Consumer Costs and Inflation

Higher energy costs resulting from increased reliance on imported LNG are likely to contribute to inflation, affecting household budgets and consumer spending.

Energy price increases tend to have ripple effects throughout the economy, potentially exacerbating economic challenges in a country already dealing with significant social and economic pressures.

Investment Climate

Energy insecurity creates uncertainty for investors, potentially deterring both domestic and foreign investment in Colombia. This could create a negative feedback loop where reduced investment further constrains energy development and economic growth.

Addressing the energy crisis is therefore not only an energy security issue but also a critical economic development challenge.

FAQs About Colombia's Energy Crisis

Why can't Colombia simply import more LNG to solve its energy problems?

While importing LNG provides a short-term solution, it creates long-term economic vulnerabilities. LNG imports are typically more expensive than domestic production, require hard currency expenditures, and expose the country to international market volatility. Additionally, reliance on imports reduces energy sovereignty and creates potential security vulnerabilities.

How does climate change factor into Colombia's energy crisis?

Climate change exacerbates Colombia's energy challenges by increasing the frequency and severity of droughts that affect hydroelectric power generation. As climate patterns become more unpredictable, the vulnerability of Colombia's hydroelectric-dependent power grid increases, creating a more urgent need for diversification and resilience in the energy system.

Could renewable energy solve Colombia's energy crisis?

Renewable energy is an essential part of the long-term solution, but the transition requires time, investment, and careful planning. In the short to medium term, Colombia needs a balanced approach that includes maintaining adequate natural gas production while accelerating renewable energy development. The intermittent nature of some renewable sources also means that backup generation capacity or storage solutions are necessary to ensure reliability.

What impact will the energy crisis have on Colombia's climate commitments?

The energy crisis creates tension between immediate energy security needs and long-term climate goals. Increased reliance on imported LNG and potentially other fossil fuels to address shortfalls could make it more difficult for Colombia to meet its emissions reduction targets. However, the crisis also creates an opportunity to accelerate the transition to renewable energy if appropriate policies and investments are implemented.

Furthermore, the crisis may affect the OPEC production impact on global energy markets as countries like Colombia seek alternative energy sources.

Further Exploration:

Readers interested in learning more about energy challenges in Latin America can also explore related educational content about the US natural gas outlook which offers insights into regional energy dynamics and potential solutions for countries facing similar challenges.

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