The Ministry of Mines and Energy of Colombia has opened a COP 104 billion funding round to support sustainable energy projects in municipalities where non-renewable natural resources are extracted. The funding comes from the Sistema General de Regalías (General Royalties System) and aims to strengthen Colombia’s energy transition with a strong territorial focus.

Each applicant may submit one project only, with a maximum allocation of COP 5 billion (approximately USD 1.2 million). Eligible initiatives must focus on power generation from Non-Conventional Renewable Energy Sources (FNCER)—such as solar PV or wind power—renewable energy commercialisation, energy efficiency, or expanding electricity access in areas with poor-quality service or no grid connection.

The call is limited to municipalities defined under Resolution 40599 of 2025, covering more than 250 localities across 27 departments. These include Yondó, Supía, Puerto Gaitán, La Jagua de Ibirico, Santa Rosa del Sur, Cúcuta, Neiva, Uribia, Tarazá, San Vicente de Chucurí and Remedios, among many others.

The initiative seeks to redirect part of the revenues generated by mining and hydrocarbon extraction towards energy infrastructure with direct local impact. Many of these producing regions continue to face structural deficits in electricity service quality and low penetration of clean energy technologies.

The funding round comes amid an intense period of regulatory activity. Colombia’s energy regulator, the Comisión de Regulación de Energía y Gas (CREG), has launched the process for a new Reliability Charge auction covering the 2029–2030 period. The goal is to secure sufficient firm capacity to meet demand, particularly through projects that integrate dispatchable renewable energy.

In parallel, Colombia is preparing its first long-term renewable energy auction, scheduled for 2026. This mechanism will enable bilateral contracts—similar to power purchase agreements (PPAs)—between generators and energy retailers, improving bankability for FNCER projects.

In addition, a core regulation of the electricity market was recently updated after more than a decade without changes. The reform creates a more favourable framework for demand-side participation, distributed generation, and the large-scale integration of intermittent sources such as solar and wind power.

Against this backdrop, the Ministry’s call is positioned as a key instrument to reduce energy access gaps at the local level. Funds may be used for off-grid systems as well as for connections to existing networks, allowing solutions tailored to local technical and social conditions.

Eligible applicants include local governments, public companies, mixed-capital entities and community-based organisations. Projects will be assessed on technical, economic and social criteria, with a strong emphasis on impact, sustainability and feasibility.

Given the limited size of the fund and the one-project-per-municipality rule, proponents are expected to prioritise strategic initiatives with potential for scale and replication. The use of royalty revenues to finance clean energy projects sends a clear signal on how Colombia intends to implement its energy transition at the territorial level.