Leveraging Political Settlement Analyses: Supporting Effective Governance in Colombia’s Green Energy Transition

While many Colombians enjoy the benefits of modern energy services, there are still significant pockets of the population where access to affordable, reliable, and modern energy remains out of reach. This lack of access doesn't just limit their ability to light their homes or cook meals; it hampers their opportunities for economic growth, education, and overall quality of life.

At the heart of addressing this issue is understanding the complex social and political dynamics that shape how energy resources are distributed and governed. USAID recognizes that for development programs to be truly effective, they must be rooted in the unique characteristics of each local context. This is why tools like Political Economy Analyses (PEAs), or other context-driven adaptation tools or frameworks like Political Settlement Analyses (PSAs), have become crucial in shaping initiatives that are not only relevant but also driven by the communities they aim to serve.

Results for Development’s Governance Action Hub  has embraced the use of PSAs, focusing on advancing a Just Energy Transition to support fossil fuel producer countries as they transition to renewables and other cleaner energies.(2) The Governance Action Hub team has started by targeting  three countries: Peru, Colombia, and the Philippines. In the case of Colombia, by conducting thorough PSAs, the Governance Action Hub team has been able to pinpoint where their efforts could make the most significant impact, particularly in addressing energy poverty. Their work goes beyond just identifying the problem—it’s about empowering local communities, aligning their needs with national initiatives, and ensuring that new energy investments lead to broader sustainable development. The following section provides a deeper overview of the analytical framework applied by the Governance Action Hub to support its work in Colombia.

Identifying Strategic Entry Points for Colombia’s Just Energy Transition

The Governance Action Hub team kicked off their efforts to advance a Just Energy Transition in Colombia by undertaking a PSA with two parts – one at the country level and one at the sectoral level.(3) This analysis served to answer the question “where can our efforts contribute to the greatest progress toward the country's energy transition?” By conducting this PSA covering both the country and sector levels, the Governance Action Hub team identified entry points that are politically feasible, as well as risks of implementation gaps between national policy and local implementation. The team then analyzed a number of potential entry points across the mining and energy sectors, eliminating options that, while potentially contributing to the Governance Action Hub’s overall goal of supporting the country’s Just Energy Transition, appeared to be avenues through which significant progress seemed unlikely, whether due to entrenched interests of powerful elites, poorly aligned incentives, or other reasons. Ultimately, they decided to tackle the issue of energy poverty in Colombia through the implementation of alternative energy communities (explained in further detail below). 

Despite having one of the highest energy coverage rates in the region, energy poverty represents a significant issue in Colombia with around 18 percent of Colombians considered energy poor,(4) meaning that they lack access to affordable, reliable, and modern energy services, hindering their ability to meet basic needs and improve their quality of life. The Governance Action Hub’s conclusion that this issue was one where they could have the most impact in supporting Colombia’s Just Energy Transition was informed by the following findings from its PSAs:

1. There is a strong enabling environment at the national level with President Gustavo Petro having made green energy a central focus of his administration. One of the initiatives to achieve this goal is that of Comunidades Energéticas (CEs) [energy communities], which brings together coalitions of public and private actors to oversee new reforms in green energy for community needs and for resale to the national grid.
2. Since the economic elite are well served by the efficient national grid in major cities, there is unlikely to be push back from entrenched interests, making progress more easily achievable.
3. With a package of new policies and frameworks, communities suffering from energy poverty can organize to receive subsidized investments in green energy and receive support to use it sustainably over time. 
4. Policy and budgetary changes are necessary but not sufficient. While these are important first steps, local processes and trust-building are equally crucial to ensure that investments are used for more inclusive governance.
5. Implementation risks exist. The PSA identified that while CEs offer a politically feasible entry point, without specific support for communities to promote local development and coordination among actors at local and national levels, the new investments might not 

With this in mind, the team convened a two-day co-creation workshop with the support of the Semillero de Transición at the Universidad de Magdalena. The session was attended by representatives from six different communities, national and local government authorities, donors, and non-governmental organizations. The primary aim of this participatory session was to gain a better understanding of the local systems operating around energy transition and pilot a participatory tool to help communities think about how best to use the new investments and sustain them over the long-term. As a result of the co-creation session, participants formed a number of collective conversations across three key areas to improve collective efforts to support the roll out of the alternative energy communities. Three collective conversations underway are:

1. Community strengthening and sustainability models: Focuses on sharing tools and lessons learned from supporting CEs across Colombia. This will help provide tailored support to communities so they can develop productive projects, improve local development, and strengthen their governance. By sharing such information, the Governance Action Hub can ensure its support, together with that of its allies, can achieve the desired scale and impact for Colombia's JET policies.
2. Evidence: Aims to identify and share reliable data on the implementation and impact of CEs, both locally and nationally. This will help stakeholders understand the broader issues related to JET and ensure that JET policies are sustainable beyond current political administrations. The Governance Action Hub also intends to make this information accessible to others outside of Colombia.
3. New voices and narratives in JET: Seeks to make local protagonists the messengers of Colombia’s JET pilot, while ensuring a broad coalition of support for the agenda across the country. This conversation is beginning with a number of allies supporting CEs to track stories, identify pertinent messages, and create narratives that put community needs at the center and channel them strategically to key audiences that will be critical to supporting the continuity of the agenda in the future. 

While this project is still in its early stages, the foundation has been laid for a promising initiative. By employing a context-driven approach and utilizing tools like PSAs, the Governance Action Hub has demonstrated the potential to effectively identify real opportunities (and risks) to support an impactful intervention in Colombia’s energy sector. As this project progresses, it will be crucial to monitor its implementation and evaluate its impact on local communities and the energy sector. The insights gained from this experience can inform future development initiatives and contribute to a broader understanding of how to effectively tailor programs to specific contexts.

The Governance Action Hub welcomes development partners to follow its endeavors on this journey, and get in touch with any questions, insights, or support to offer. 

Endnotes

1.  Mushtaq H Khan, Political settlements and the analysis of institutions, African Affairs, Volume 120, Issue 480, July 2021, Page 509, https://doi.org/10.1093/afraf/ady055

2. The Governance Action Hub is not a USAID-funded program. It is currently funded by the BHP Foundation.

3. More specifically, the Governance Action Hub team utilized SOAS-ACE’s “Power, Capabilities and Interests” approach as the framework for its analysis.

4. Results for Development. (2023, August 14). Harnessing local systems: A participatory approach to a just energy transition in Colombia. Results for Development. https://r4d.org/blog/harnessing-local-systems-participatory-approach-just-energy-transition-colombia/