Market assessment for Green Hydrogen in La Guajira, Colombia

Date documents can be requested until : 16 June 2025 16:00
Title : Market assessment for Green Hydrogen in La Guajira, Colombia.
Procurement No. : 100012871
Process : RFP

Date documents can be requested until : 02 June 2025 16:00
Title : Market assessment for Green Hydrogen in La Guajira, Colombia.
Procurement No. : 100012871
Process : RFP
Description : Global Green Growth Institute in Colombia invites all eligible companies to submit their proposals for consulting services to conduct a market assessment for Green Hydrogen in La Guajira, Colombia.

PROJECT BACKGROUND:
The Global Green Growth Institute (GGGI) was established as an intergovernmental organization with the objective of promoting sustainable development of developing and emerging countries including the least developed countries. GGGI is dedicated to supporting the creation and diffusion of the model of economic growth known as “green growth”. The green growth model integrates economic growth, environmental sustainability, poverty reduction and social inclusion.

Colombia has committed to reducing 51% of its emissions by 2030 and achieving carbon neutrality by 2050. To meet these targets, the Government of Colombia (GoC) published the National Energy Plan 2020-2050 to diversify the energy mix currently dominated by hydroelectric power (73%).
Colombia's vast renewable energy resources, strategic position, and stable economic framework make it a prospective hydrogen producer and exporter. According to Colombia's Hydrogen Roadmap (published in 2021), Colombia has a current Hydrogen (H2) demand of 150kt/year driven
by refineries (84%) and fertilizer manufacturing (12%), of which practically all is grey hydrogen. The market study, completed as part of the roadmap, estimates Colombia’s demand of low carbon hydrogen will increase to 120 kt/year by 2030 and 790kt/year in 2040.

The roadmap has calculated the Levelized Cost Of Hydrogen (LCOH) by each region in Colombia (based on the renewable energy source), showing La Guajira region in the north Caribbean as the region with the lower LCOH thanks to their world-class wind resource with capacity factor over 60%, and good solar resources, the LCOH in 2030 is estimated to be 2.2 USD/kgH2 using wind source. La Guajira is strategically situated in the Caribbean Sea with access to Europe, East side of USA and West side of USA and Asia through the Panama Canal. The GoC is planning to develop a Green Hydrogen Hub in the region with the intention of exporting to markets willing to pay the higher price for green hydrogen during the early stages of technology and market.
Among the municipalities benefiting from wind energy projects in La Guajira, Uribia stands out. Uribia is one of the poorest municipalities in the country, with a poverty rate of 92.2%. These communities are highly dependent on coal mining. Renewable Energy and hydrogen can be an alternative sector providing green jobs in the communities; however, some projects are facing resistance by local communities with claims for more in-depth consultations to better inform the local people on the consequences, opportunities and benefits of the development of these large-scale energy projects.

GGGI is implementing a project with funding from the Korean Green New Deal Fund (KGNDF), GGGI is providing technical assistance for a flagship green hydrogen project in La Guajira including:
a. technical assessment of the competitiveness of the green hydrogen produced in La Guajira
b. market assessment for export and national consumption of green hydrogen and derivatives
c. financial assessment, including incentives and climate finance access
support the socio-economic characterization of the local community

PROPOSED ACTIVITIES & SCOPE OF WORK:

1) Proposed Activities for the Overall Project
GGGI seeks to engage a competent consulting firm to undertake the following tasks:
- Task 1: Market study for GH2 and GNH3 for national market and at least three export markets. The study will provide detail insights of trends of demand for GH2 and GNH3 as well as specific requirements to access those markets defining how projects in Colombia can access those markets.
- Task 2: Engineering and economic study on a selected flagship Green Hydrogen (GH2) / Green Ammonia (GNH3) project in La Guajira. The study will provide with details that will help to assess the competitiveness of the projects in La Guajira.

2) Scope of Work

2.1. Task 1: Market Assessment

2.1.1. The Service Provider will perform a market assessment in the Colombian national market and three export markets: Japan, South Korea and European Union (EU). The market assessment will include demand projections, applications, relevant regulation and certifications, estimation of willingness to pay and mapping of potential off-takers in each of the markets assessed.
2.1.2. As part of the market requirements, the Service Provider will assess green certification, purity and other commercial requirement, for example length of off-taker agreements and risk of price fluctuation that can influence the project design and commercialization strategy.
2.1.3. The Service Provider will also include an assessment of the projects supplying GH2 and GNH3 to the markets analyzed. Including, when available, the LCOH and LCOA for those projects. This information will support the assessment of the competitiveness of Green Hydrogen and Green Ammonia from La Guajira in those markets.
2.1.4. The Service Provider will deliver the following:
I. Assessment report with details of the 4 markets assessed: Colombia market, Japan, South Korea and EU. Report must include a chapter of the approach of how Colombia project can access those markets.
II. Database with possible off-takers and announced tenders in each market.
III. Database with announced projects providing GH2 and GNH3 to the markets analyzed.

2.2. Task 2: Engineering and economic Study

2.2.1. GGGI will provide to the Service Provider the information of the selected project in La Guajira, including the pre-feasibility assessment.
2.2.2. The selected project will have a capacity to produce 100-150ktH2/year and 600-850ktNH3/year.
2.2.3. The selected project scope includes wind farm, transmission lines, electrolyser, water desalinization plan, ammonia production facilities and ammonia storage facilities.
2.2.4. The Service Provider will assess the critical challenges and national status regarding required Infrastructure (Ports, roads, transmission lines, etc.) for: 1) Project development (constructability), 2) Ammonia exports 3) Delivery to domestic market, 4) O&M.
2.2.5. The Service Provider will provide a conceptual design with the optimization of all the main elements of the project renewable energy, transmission lines, electrolyser, water desalinization plan, ammonia production facilities and ammonia storage facilities.
2.2.6. The Service Provider will complete a project modelling to achieve optimal sizing of the project components ensuring compliance with certification/regulatory criteria for construction and commercialization (as identified in task 1).
2.2.7. The main renewable energy system is a wind farm. GGGI will provide with details of the wind farms in the same area that are in pre-construction stage. As part of the modelling the Service Provider will assess if the plant can be optimized adding a solar PV farm. The Service Provider shall provide with recommended size for the plant.
2.2.8. The Service Provider will calculate CAPEX, OPEX, Levelized Cost of energy (LCOE), Levelized Cost of Water (LCOW), Levelized Cost of Hydrogen (LCOH), Levelized Cost of Ammonia (LCOA) and also the transport cost to each market of interest identified in Task 2. The modelling will include sensitivity analysis.
2.2.9. The Service Provider shall provide a recommended project configuration to optimize the economic, technical and environmental considerations. The analysis will also include implementation timeline, technology maturity and the market technical and certification requirements analysed in Task 1.
2.2.10. The Service Provider will provide an analysis of an alternative approach to implement the project in phases, by installing scalable modules of smaller size that will be added overtime to reach the desired capacity. This analysis will include a cost-benefit comparison with the large-scale approach.
2.2.11. The Service Provider will conceptualize the preliminary business model for the project, considering aspects like project partners, off-takers, sources of income, regulations, national and international incentives and available finance instruments.
2.2.12. The Service Provider will provide a model in excel to show project cash flow for the different partners.
2.2.13. The Service Producer will identify and take into account during the modelling and optimization of the plant possible social benefits for the local communities, like provide potable water of electrification for local communities.
2.2.14. The Service Provider shall provide a report with at least the following chapters:
- Assessment on critical challenges for project life cycle and market supply
- Book of assumptions
- Conceptual design with a description of the optimal configuration and a site layout.
- Technical specifications of the key components of the plant (at least the following components will be detailed: renewable energy system, transmission lines, electrolyser, water desalinization plan, ammonia production facilities and ammonia storage facilities
- Results of modelling with CAPEX, OPEX, LCOE, LCOW, LCOH, LCOA
- Added cost on LCOA, due to transport to each of the markets identified in task 1.
- Conceptualization of the business model for the project considering aspects such as partners, off-takers, key resources, sources of income, regulatory aspects, among others.
- Perform a financial analysis of the project with assumptions under 3 scenarios delivering results in terms of Net Present Value (NPV), Investment Rate of Return (IRR), Return of Investment (ROI) and payback period.
- Sensitivity analysis
- Identification, quantification and description of the influence in design and cost to provide local communities with services by the project. At least electricity and potable water will be assessed.

For more details, please refer to the Terms of Reference (TOR) document attached.

IMPORTANT TIMELINES:
The tender submission deadline is JUNE 2, 2025 16:00 HRS KOREAN STANDARD TIME (KST).

If any bidder has any request for clarification on the TOR or any part of the tender documents, GGGI will be happy to clarify if they are received on or before 7 days before the deadline (namely: if the tender submission deadline is 16:00 June 2, 2025 KST, then the due date for submission of request for clarification is 16:00 May 26, 2025 KST).

Interested parties will be required to register their details on the GGGI e-Green Procurement Portal (https://in-tendhost.co.uk/gggi).

HOW TO OBTAIN THE DOCUMENTS:
Documents can be accessed via the e-Green Procurement Portal by selecting ‘View Details’ on the relevant notice and then clicking the ‘Tender Application’ button. If you are a new supplier, you will be required to register your details. If you have an existing account, you will need to login to the portal. Please refer to the guidance documents under the `Supplier Guidance` area of the portal for further information.

ONLINE TENDER MANAGEMENT:
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OPTING IN & OPTING OUT:
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SUBMITTING YOUR RESPONSE VIA THE PORTAL:
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Please read Instructions on How to submit the Proposal.

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