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Scatec Commences Construction of 130 MW Barzalosa Solar Project in Colombia

4 April 2026 at 00:18

Renewable expansion strengthens Colombia energy matrix for investors.

The Norwegian renewable energy company Scatec ASA (OSE: SCATC) has reached financial close and initiated construction on the Barzalosa solar power plant in Colombia. The project, located in the municipio of Nariño within the department of Cundinamarca, has a planned capacity of 130 MWp. Total capital expenditure for the facility is estimated at $121 million USD.

The financing structure for the project is based on a 70% leverage model, utilizing a combination of equity and non-recourse debt. Scatec holds a 65% equity stake in the venture, while Norfund, the Norwegian investment fund for developing countries, provides the remaining 35%. The senior debt was provided by Bancolombia S.A. (NYSE: CIB; BVC: BCOLOMBIA) and the Financiera de Desarrollo Nacional (FDN).

The Financiera de Desarrollo Nacional committed a total of 200,358 million COP to the project. This includes a senior debt facility of up to 164,458 million COP with a term of 18 years, representing approximately 50% of the total project debt. Additionally, the FDN provided a bank guarantee of up to 35,900 million COP to substitute reserve accounts for debt service and operation and maintenance costs. The FDN also acted as a co-structurer for the financial framework of the operation.

“The financing of the Barzalosa project reflects the capacity of the FDN to structure long-term financial solutions that make strategic energy transition projects in Colombia viable,” said Enrique Cadena, Vice President of Structured Finance at the FDN.

The law firm Holland & Knight served as legal counsel to the lenders, Bancolombia and FDN, in the COP 330 billion financing transaction. The legal team was led by partner María Juliana Saa, with support from partner Inés Elvira Vesga and associates Juan Sebastián Parra and Juan Felipe Alonso. Other legal and financial advisors involved in the transaction included Cuatrecasas, which advised the borrower; Brigard Urrutia, which advised FDN regarding the credit facility; and Astris Finance, which provided financial structuring advice.

Revenue for the plant will be supported by a 15-year Power Purchase Agreement (PPA) with BTG Pactual Comercializadora de Energía (BVMF: BPAC11). The agreement covers 85% of the estimated energy production and is denominated in Colombian pesos, with adjustments based on the Producer Price Index. The remaining 15% of production will be sold on the Colombian spot market. The project is also eligible for the Cargo por Confiabilidad (reliability charge) and may access resources from the Inter-American Development Bank and the Climate Investment Funds.

Construction includes the installation of the solar array and the development of a six-kilometer transmission line to connect the plant to the national grid. Scatec is acting as the lead developer and the designated Engineering, Procurement, and Construction (EPC) provider, covering approximately 70% of the capital expenditure. The company will also manage operations, maintenance, and asset management. The Barzalosa plant is expected to reach its commercial operation date in the first half of 2027.

Border Crossing Between Colombia & Ecuador Reopens After 19 Day Blockade

Finance Colombia

By: Loren Moss

28 March 2026 at 20:42

While Colombia & Ecuador are at peace, the neighboring presidents have a sour relationship going back to when Colombian President Gustavo Petro initially refused to recognize Daniel Noboa’s election.

Traders and transport operators have suspended a 19-day blockade at the Rumichaca International Bridge, the primary land crossing between Colombia and Ecuador. The protest, catalyzed by a 50% tax imposed by the Ecuadorian government on Colombian goods, was lifted to accommodate travel and commerce during the Semana Santa holiday period. Despite the suspension of the strike, the regional business community reports that significant economic damage and diplomatic tensions persist.

Ecuador’s President Daniel Noboa (photo: Carlos Silva/Presidencia de la República)

The closure of the border crossing created a substantial disruption in binational economic activity. Estimates from the Cámara de Comercio de Ipiales in Nariño, Colombia indicate that losses reached approximately $5 million USD per day due to freight remaining stationary in the border zone. The Comité Gremial de Trabajadores de la Frontera de Ipiales stated that while the reopening is a responsible gesture for the high-traffic holiday season, current tariff policies continue to threaten hundreds of direct and indirect jobs linked to foreign trade.

The Governor of Nariño, Luis Alfonso Escobar, criticized the trade barriers implemented by the administration of Ecuadorian President Daniel Noboa. Governor Escobar argued that such measures inadvertently encourage illicit activities in the region. He emphasized that instead of facilitating formal commerce, high tariffs drive trade toward illegality, undermining regional security efforts. To mitigate the conflict, the Comunidad Andina de Naciones (CAN) has initiated high-level dialogues. Diplomatic delegations led by Colombian Deputy Minister of Foreign Affairs Juana Castro and her Ecuadorian counterpart, Alejandro Dávalos, held a virtual working group to address pending issues in trade, transport, energy, and hydrocarbons.

“Decisions adopted without considering the reality of our communities have put at risk the livelihood of merchants, transporters, foreign trade workers, and thousands of people who live from binational exchange,” stated the Comité Gremial de Trabajadores de la Frontera de Ipiales.

Diplomatic friction has extended into the energy sector. President Noboa claimed that in 2017, Ecuador assisted Colombia during a potential blackout by charging 1.6 cents USD per kWh, whereas in 2024, Colombia charged an average of 28 cents USD per kWh during Ecuador’s hydroelectric crisis. In response, the Colombian Minister of Mines and Energy, Edwin Palma, clarified that prices during the 2023-2024 El Niño phenomenon reflected the actual costs of production and distribution, particularly when fossil fuel-powered thermoelectric plants using fuel oil and diesel were activated.

The ongoing trade dispute has impacted more than 5,500 companies over the past two months. Diana Marcela Morales, the Colombian Minister of Commerce, Industry, and Tourism, confirmed scheduled meetings with Ecuadorian officials to de-escalate the conflict and establish fair, transparent rules. Concurrently, the Ministerio de Comercio, Industria y Turismo has moved to protect domestic industries by implementing new tariffs on steel and ceramics from countries without existing free trade agreements. These measures aim to counter market distortions and protect a sector that employs more than 50,000 people while promoting circular economy practices and reducing CO2 emissions.

Above photo: Border between Ecuador & Colombia looking towards Ipiales, Colombia (Photo: Cancillería de Colombia)