Publication:
Learning from Developing Country Power Market Experiences: The Case of Colombia

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dc.contributor.authorRudnick, Hugh
dc.contributor.authorVelasquez, Constantin
dc.date.accessioned2019-03-14T19:50:27Z
dc.date.available2019-03-14T19:50:27Z
dc.date.issued2019-03
dc.description.abstractThe Colombian power market was established in 1995, driven primarily by concerns about the reliability of supply in the largely hydro-based domestic power system. The power sector reform was expected to help avoid blackouts by attracting private investment and increasing the efficiency of existing capacity. However, two decades after its inception, the market has not been successful in providing reliable supply along competitive outcomes. This paper analyzes the experience of Colombia with power markets, including market design, implementation, and outcomes. A single-node, bid-based market was established overnight, with bilateral contracts among market participants (mostly short-to-medium term). The original regulated capacity payment was replaced in 2004 by a reliability market intended to ensure supply during tight hydrological conditions (mainly due to El Nino phenomena). However, the Colombian power sector is currently showing signs of structural weakness: the reliability market has shown dysfunctionalities, the government has intervened the market during critical situations, and concerns persist regarding market power exercise. The experience of Colombia is important for other developing countries, since it highlights the challenges of designing and implementing a power market that successfully provides reliability, competitive outcomes, and sustainability. Although key local hydrological conditions were considered in the design of Colombia's capacity market, the market had difficulties delivering intended outcomes due to design and institutional issues, particularly the lack of a comprehensive approach to gas supply and transport.en
dc.identifierhttp://documents.worldbank.org/curated/en/898231552316685139/Learning-from-Developing-Country-Power-Market-Experiences-The-Case-of-Colombia
dc.identifier.doi10.1596/1813-9450-8771
dc.identifier.urihttps://hdl.handle.net/10986/31397
dc.languageEnglish
dc.publisherWorld Bank, Washington, DC
dc.relation.ispartofseriesPolicy Research Working Paper;No. 8771
dc.rightsCC BY 3.0 IGO
dc.rights.holderWorld Bank
dc.rights.urihttp://creativecommons.org/licenses/by/3.0/igo
dc.subjectELECTRICITY
dc.subjectPOWER SECTOR
dc.subjectENERGY
dc.subjectEMERGING MARKET ECONOMIES
dc.subjectTRANSMISSION AND DISTRIBUTION NETWORK
dc.subjectNATURAL GAS
dc.subjectPOWER SECTOR REFORM
dc.titleLearning from Developing Country Power Market Experiencesen
dc.title.subtitleThe Case of Colombiaen
dc.typeWorking Paperen
dc.typeDocument de travailfr
dc.typeDocumento de trabajoes
dspace.entity.typePublication
okr.crossref.titleLearning from Developing Country Power Market Experiences: The Case of Colombia
okr.date.disclosure2019-03-11
okr.doctypePublications & Research
okr.doctypePublications & Research::Policy Research Working Paper
okr.docurlhttp://documents.worldbank.org/curated/en/898231552316685139/Learning-from-Developing-Country-Power-Market-Experiences-The-Case-of-Colombia
okr.guid898231552316685139
okr.identifier.doi10.1596/1813-9450-8771
okr.identifier.doihttps://doi.org/10.1596/1813-9450-8771
okr.identifier.externaldocumentum090224b086a51abc_1_0
okr.identifier.internaldocumentum30892847
okr.identifier.reportWPS8771
okr.importedtrueen
okr.language.supporteden
okr.pdfurlhttp://documents.worldbank.org/curated/en/898231552316685139/pdf/WPS8771.pdfen
okr.region.administrativeLatin America & Caribbean
okr.region.countryColombia
okr.statistics.combined5276
okr.statistics.dr898231552316685139
okr.statistics.drstats4482
okr.topicEnergy::Electric Power
okr.topicEnergy::Energy Markets
okr.topicEnergy::Energy Policies & Economics
okr.topicEnergy::Energy and Environment
okr.topicEnergy::Oil & Gas
okr.unitEnergy and Extractives Global Practice
relation.isSeriesOfPublication26e071dc-b0bf-409c-b982-df2970295c87
relation.isSeriesOfPublication.latestForDiscovery26e071dc-b0bf-409c-b982-df2970295c87
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