The announcement represents the latest setback for Colombia's energy transition, where many renewable projects have stalled despite President Gustavo Petro's goal of weaning the country off of fossil fuels.
"Due to significant delays in environmental permits and licenses by local entities, EDF Renewables and its partners have decided to withdraw from energy development at the Girardot power plant, in Cundinamarca (province)," the company said in a statement.
"This situation is also a consequence of regulatory and fiscal changes that have occurred since the auction took place," the statement added, referring to the impact on the project's future profitability due to a tax reform, as well as increases in interest rates and exchange rate volatility.
EDF did not provide details about the project's generation capacity or the investments made so far.
The Ministry of Mines and Energy did not immediately respond to questions regarding the French company's decision.
In 2021, EDF Renewables' Colombia unit won a long-term energy auction promoted by the government to build two solar farms with a combined capacity of 145 megawatts.
EDF Renewables is developing another solar project in Colombia's Meta province.
Last May, Italy's Enel indefinitely stopped the construction of a wind farm in La Guajira province due to community resistance and after cost overruns of more than $250 million and constant delays in permissions and licenses.
The difficulties arise at a time when energy prices in Colombia have risen along with the arrival of the El Nino climate phenomenon, causing droughts in the country, which gets around 70% of its electricity from hydroelectric plants.
