Colombia Has Favourable Conditions to Expand Solar Power

29.10.2026

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Vaula Aunola
Photo: ERCO

Infrastructure

Finnfund and Proparco, backed by a European Union guarantee, are supporting Colombian solar energy company ERCO as it expands solar generation and battery storage capacity.

Finnfund and Proparco are investing USD 33 million in Colombian solar energy company ERCO to support the expansion of solar generation and battery energy storage capacity. The investment, backed by a European Union guarantee, is intended to strengthen Colombia’s energy security and reduce its reliance on hydropower.
The financing is part of a wider equity round led by Augment Infrastructure Managers and involving development finance institutions and impact investors. The funds will support the construction and expansion of solar assets, with European clean technology companies involved in the projects.

Founded in 2012, ERCO has developed from a solar engineering and maintenance company into an integrated clean energy platform. Its operations include project development, engineering and construction, power generation and digital energy retail. The company has delivered more than 2,000 solar projects and is active in Colombia’s commercial and industrial solar market.

“Colombia has enormous potential for renewable energy, and expanding solar generation is essential for building a more resilient and reliable power system. ERCO has established itself as a leading integrated solar platform with a strong track record in project development, construction, operation and energy retail. We are pleased to support the company’s next growth phase and its contribution to Colombia’s clean energy transition,” says Ari Nironen, Senior Investment Manager at Finnfund.

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Solar Capacity and Battery Storage

Colombia’s electricity system relies heavily on hydropower and is therefore exposed to droughts and other climate-related events, including El Niño. Electricity demand is also expected to grow as the economy expands and electrification advances.

ERCO plans to add approximately 1 GWp of solar generation capacity by 2030. The company says its investments in solar power and battery storage will help diversify the country’s electricity mix, improve grid resilience and reduce greenhouse gas emissions.

“The confidence of Finnfund, Proparco and our investors gives us the capital to accelerate Erco’s current phase of growth. This investment will support the deployment of solar and battery storage capacity in Colombia, while strengthening our ability to leverage local financing and rotate capital into new projects, expanding Colombia’s renewable energy capacity while generating meaningful social, environmental and productive impact across the country,” says Luis Fernando Gómez, Chief Financial Officer of ERCO.

The project is supported through the EDFI Renewable Energy Transition guarantee, managed by EDFI Management Company under the EU’s European Fund for Sustainable Development Plus programme. The programme is part of the EU’s Global Gateway strategy.

“The EU is a natural ally for Colombia in advancing its energy transition, greening power generation and building a more competitive, resilient and secure energy system, capable of responding to challenges such as El Niño and geopolitical crises. We are proud to support a European DFI investment in an emerging Colombian company such as ERCO, partner of the European clean-tech ecosystem, using an innovative guarantee tool that enables investments for renewable energy projects,” says François Roudié, Ambassador of the European Union to Colombia.

ERCO also reports that women account for 26% of its employees and 33% of its managers. The company has committed to maintaining and strengthening women’s participation in its workforce and leadership teams.