Security of the Colombian energy supply: The need for liquefied natural gas regasification terminals for power and natural gas sectors

Abstract

The reliability of natural gas and electricity supply is a crucial aspect in many fast-growing economies, as the economic boom of these countries demands a solid energy infrastructure. In Colombia, the economy has experienced a steady increment over the last several years that have placed the country as one of the most promising economies in Latin America. However, the natural gas infrastructure lacks sufficient robustness to withstand the rate of economic growth. This paper assesses the impact on the reliability of a liquefied natural gas regasification terminal in Colombia as one potential solution to improve the reliability in the country. Contrary to other works, this paper investigates the impact of using an integrated electric and natural gas model, as there exists a strong interdependency between both sectors. This approach is more suitable since it permits evaluation of the impact of a terminal on electricity users, as they also experience the negative consequences of an unreliable natural gas supply. Numerical results show that the terminals substantially improve the reliability of both systems. Furthermore, numerical results prove that the current regulatory approach, based on a priority service queue to mitigate the negative effect of an unreliable system, would no longer be needed.