Colombia to launch incentives for renewables in February

The Colombian government presented on Monday its tax incentives for investments in renewable energy sources, valid from February 2016.

The decree specifies the deduction of 50% of investments from the income tax for five years, accelerated depreciation, value-added tax (VAT) exemption on the equipment for the projects and exemption from duties.

Despite decreasing technology costs over the last years, renewable energy cannot yet compete with hydro power and gas, the mines and energy ministry said. The government is aiming at a cleaner and diversified energy mix and efficiency through technology upgrading, also stimulated with a discount on the income tax for five years. Through energy efficiency, Colombia has the potential to save up to 10% of its consumed electricity.

A recent study by the ministry's planning division has recommended the development of wind farms in the La Guajira peninsula, distributed self-generation solar systems, biomass cogeneration, geothermal power and hybrid systems. Commenting on the study, minister Tomas Gonzalez said the government wants to use innovative solutions for bringing electricity to remote areas.

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