I have tried to use the light template example (Template Light - Home Assistant) in a freshly installed HA installation.
It shows directly major errors in connection with the effect. After commenting out the effect related lines, the configuration has no error anymore and can be restarted.
But with this template, there is no color selector visible anymore. I can only switch it on/off or change the brightness.
It is a copy of the template and I needed to comment the set_effect and set_white_value to get it working.
The view on a dashboard is the following. It has no option for setting the color: