Regulation & Policy Jun 21, 2021 4:55 PM
The Minister of Mines and Energy (MinEnergía), Diego Mesa, announced progress on the energy transition law.
Mesa said that the House of Representatives approved 42 of the 56 articles of the energy transition bill, reported Valora Analitik.
This bill promotes geothermal, hydrogen, energy storage, carbon capture and sustainable mobility.
“This law extends tax benefits especially for energy efficiency and hydrogen. In addition, the bill establishes requirements for the advancement of geothermal,” SER Colombia’s Germán Corredor said.
The expert said that the law will incentivize green and blue hydrogen with benefits.
The bill creates incentives for urban passenger transportation companies that use electric vehicles. The project introduces energy storage systems within the Law 1715 of 2014.
It is important to remember that the 2014 law gives incentives to renewable projects such as 50% income deduction, VAT exclusion, accelerated depreciation and elimination of tariffs for products linked to renewable energies.
However, Corredor said that this income deduction is a benefit that only applies to companies that have been operating in the country for some time.
“New companies end up competing under unequal conditions,” Corredor said.
Bottom-Line: The government continues to announce advances to incentivize renewable energies in the country. However, authorities should listen to the comments of experts like Corredor, as incentives should apply to all members of the sector, new or old.
Flexibility in the rules will be vital to attract the investors’ interest.