Colombia has taken a step towards reshaping its energy financing framework with the creation of FONENERGÍA, a fund designed to centralise resources and expand electricity and gas coverage, particularly in rural and non-interconnected areas.
The measure addresses a structural deficit: more than 1.8 million households still lack access to electricity, underscoring the urgency of accelerating solutions with stronger institutional coordination.
The new scheme consolidates legacy instruments such as FAER, FAZNI, PRONE and the Gas Fund, bringing resource allocation and execution under a single structure. From a regulatory standpoint, this represents a significant shift in sector governance.
In this context, Hemberth Suárez Lozano, founding partner of OGE ENERGY, warned about the institutional scope of the new model: “What is being created is an untamed Ministry of Mines and Energy,” he said, referring to the degree of centralisation introduced by the fund.
The expert explained that the regulatory foundation had already been established in the National Development Plan, while the decree ultimately formalised the operational model. In this sense, centralisation seeks to improve resource targeting and accelerate projects in underserved regions.
However, the new framework also raises implementation risks. While a single state financial vehicle may streamline management, it could also introduce additional administrative bottlenecks if not properly managed. “FONENERGÍA could become a ‘super bureaucratic filter’,” Suárez warned, stressing the importance of applying technical criteria in resource allocation.
Execution challenges and role in the energy transition
The fund’s scope goes beyond expanding coverage, as it includes the possibility of financing solutions based on non-conventional energy sources and cleaner fuels. This positions it as a relevant tool for accelerating the energy transition in remote areas.
Its design also envisages the coordination of public funds, local government contributions, private investment and international cooperation, requiring strong institutional alignment. At the same time, it enables the channelling of financing towards renewable energy projects through its linkage with FENOGE.
In this context, technological diversification emerges as a key pillar to avoid distortions in resource allocation. The fund will need to balance different energy sources and solutions, particularly in regions with varying technical conditions.
From a regulatory perspective, the scheme also establishes that assets financed with public resources will remain under state ownership until their eventual transfer. This provides legal clarity, but may also influence private sector participation in co-financing schemes.
Beyond its institutional design, the main challenge will lie in execution. The allocation of public resources requires strict oversight, which naturally affects implementation timelines. Striking the right balance between control and efficiency will therefore be critical.
“What is expected is for FONENERGÍA to operate with the necessary technological agility, as well as technical and objective motivation,” Suárez noted, highlighting the need to modernise the fund’s management.
With a projected investment of $3.7 trillion by 2030 and the goal of benefiting more than 300,000 people, FONENERGÍA stands out as one of Colombia’s key initiatives to close persistent energy access gaps.
