A proposed US$500mn electricity link between Colombia and Panama received a boost on Thursday with the approval of funds for design, technical and environmental studies.

In a statement, Colombian state-run transmission group Interconexión Eléctrica (ISA) said it received a US$500,000 non-refundable loan from the Washington-based Inter-American Development Bank (IDB).

Interconexión Eléctrica Colombia Panamá (ICP), a 50:50 joint venture between ISA and its Panamanian counterpart Etesa, will contribute the rest of the US$4.97mn needed to complete the studies, it said.

“This is a further milestone [that shows] the commitment that both countries have to guarantee energy security for the region,” ICP director Andrés Villegas said.

According to ICP, the 500km line – which includes a 130km marine stretch – is due to begin operating in 2024.

In June, a senior Colombian energy official told BNamericas that a competitive bidding process for the project could be launched next year.

The cross-border power link has been on the agenda of both governments since 2001 but plans have been stymied by environmental and social concerns.

Credit: IDB

Panama’s licensing authority has yet to approve the project because of opposition from the Kuna Wargandi and Guna Yala indigenous peoples.

According to preliminary information, the 300kV HVDC line would connect the Cerromatoso substation in Colombia’s Córdoba department to the Panamá II substation in Panamá province, with capacity to transport 400MW.

Colombian officials say the link would pave the way for renewable energy exports from the Guajira peninsula to Central America’s Siepac grid while reinforcing domestic supply, particularly during El Niño drought cycles.

Jorge Rivera Staff, the energy sector content coordinator for Panama’s President Laurentino Cortizo, told BNamericas in May that the interconnection project is part of the new government’s agenda.