IMPORTING know-how

Sumitomo Corp’s recent focus has centered on advancing hydrogen projects and exploring applications beyond mobility.

What have been the most interesting advances by Sumitomo Corp in the past year?

We have been working on hydrogen projects and the production of hydrogen on a mass scale. Initially, we were looking at the use of hydrogen in the area of mobility, though we are now looking at other areas and possibilities such as blending hydrogen with gas for example or co-firing hydrogen with LNG. We are looking at the industrial usage of hydrogen, which will help reduce CO2 emissions. The key is to be competitive in terms of production costs. The current energy mix in Colombia is fairly green, with 70% coming from hydropower. The country is also looking at large-scale wind power, offshore wind, and solar power, and hydrogen will fit in well with the country’s energy mix. Our target for mass production of hydrogen is after 2030, which gives us about 10 years to work on producing it on a large scale in line with the government’s goal to stop oil exploration by then. The current government is also concerned about the environment, which means we do not expect any change in direction or legislation.

How do you plan to incentivize demand for hydrogen in the Colombian market?

It will take time and a great deal of support from the government such as subsidies, for example, which is not the case in Colombia at this moment. That is why it will still take some time, even though there have been positive developments in the transportation industry, for example, in terms of electric buses and the bus rapid transit (BRT) system; however, for transport situations that require larger cargo capacities or longer distances, EVs cannot be a solution. That is where hydrogen can come in. Still, at the moment there is a cost issue, which the government has to support via subsidies.

What other interesting projects are currently underway in Colombia?

We want to fully utilize digital transformation.

For example, in the area of agriculture, we have invested in a company called Summit Agro that distributes agrochemicals. Cut flowers are a major sector in Colombia, and it is the second-biggest supplier in the world behind the Netherlands. However, flower farms in the country always have a labor shortage, which is why we are looking to bring in technologies from Japan. Given the high average age of workers in Japan, it focuses heavily on optimizing technology, and we are positive we can bring in various technologies into Colombia to help solve the pain points of farmers.

Actively involved in hydrogenrelated projects, including massscale production and various applications

Plans to produce green hydrogen in Colombia, taking advantage of country’s clean energy mix

Which sectors offer the greatest potential for significant future growth in Colombia?

The agro industry has excellent potential given that the country has rich natural resources, amazing weather, and plenty of available land. In addition, the government is focused on reducing poverty and spurring employment in rural areas, which is why it is focusing not only on cultivating agricultural produce but also on adding value to and exporting products in the industry. We see immense potential in the industry, especially compared to Brazil or Argentina, which cultivate items such as grain on a large scale whereas Colombia produces more nutritious and high-value items like avocado. Furthermore, globally, animal-based protein is placing bigger burdens on the environment, which is why we expect an increase in plantbased protein. Securing protein as a resource for humans is becoming a major challenge that is also related to environmental sustainability. In the cattle industry, we are also looking at decarbonizing the cattle supply chain, utilizing different kinds of pastures that could perhaps absorb more CO2, or help cattle grow faster so that they can utilize less water. We are working on a project with the local entities in Colombia to develop feed additives. This will be an important project not just for Colombia, but also the global environment. We are currently at the initial stages, though the project looks set to be extremely interesting.

GENERAL MANAGER & MARKET BUSINESS LEADER FOR COLOMBIA, AES COLOMBIA What have been the company’s achievements in the last few years?

AES is a 100% renewable company with multiple technologies. We work in water, we operate three solar parks, and our major bet in terms of renewable growth is wind in La Guajira. An important milestone of ours includes the Chivor hydro facility. With 1,000MW of installed capacity, it is the third-largest hydro facility in Colombia. Chivor had already been in operation for 45 years, and we made two significant investments to upgrade it. The first one, amounting to almost USD120 million, was completed in early 2022. We built new intakes to ensure the reservoir could continue to operate for 50 more years. The second investment is to reinforce one of the tunnels from the reservoir to the oil plant and will be about USD50-60 million. We will continue to invest in the hydro facility to make sure that it continues to have the latest technology and strong reliability. Chivor continues to be a key asset for the Colombian electricity market, particularly for Bogotá, and we will continue to invest in making sure the hydro project will continue to serve the Colombian electricity market. The second element of our strategy is solar. We have three plants in operation: Castilla; San Fernando, the largest solar autogeneration project in Colombia; and Brisas Solar Park, which we developed together with Ecopetrol to meet its particular needs. We plan to continue developing similar projects with Ecopetrol and other oil and gas companies as well as other companies that are large energy consumers. In addition, we are developing more solar energy not for internal consumption but to be sold to the grid. This will further diversify the generation of energy, which is a key component of resilience. Colombia is heavily dependent on hydro, with 80-85% of energy generated by hydro in a normal year; however, in recent years, climate change and the El Niño phenomenon have resulted in lower inflow into our reservoirs, which means we must also look at other alternatives.

How is AES Colombia implementing innovation and technology in all its projects?

We see innovation on various many fronts, particularly with digitalization and AI. We use them, for instance, not only for our operations, but also commercially to ensure the generation mix we are using every day is more efficient for the system. Then, there is the aspect of social innovation. We have been leading the way in terms of our approach with communities in La Guajira. We have been in La Guajira since 2009-2010 and have working closely with the local community since then. With the approach we have developed there, the locals feel as though they are our partners in the development. The majority of our team in La Guajira are local Wayuu people, and we train them for certain roles in our projects. If we succeed in La Guajira, they will similarly succeed and see an improvement in the quality of their lives. We are innovating in terms of bringing electricity and water to the communities. Innovation is a key element of our corporate culture.