The World's #1 Renewable Energy Network for News, Information, and Companies.
Untitled Document

Renewable Energy Recap: Argentina

Developers, manufacturers, investors and other renewable energy industry stakeholders need to know where the next big market is going to be so that they can adjust their business decisions accordingly.

Since 2003, global consultancy Ernst & Young has released its Country Attractiveness Indices, which gives a numerical ranking to 30 global renewable energy markets by scoring renewable energy investment strategies and resource availability. The indices are updated on a quarterly basis and the most recent report can be found here.

Here is the firm’s assessment of Argentina.

General

Argentina is the third-largest power market in Latin America, and one of the most deregulated, with around three-quarters of the country’s generation capacity owned by private companies.

Argentina’s power mix primarily comprises natural gas (over 50%) and hydropower (circa 40%). Argentina’s dependence on gas is of concern given the country’s own natural gas reserves have reduced considerably over the last five years.

Electricity demand continues to grow steadily in the country and forecasts suggest an ongoing annual increase of 6%. Estimates indicate that an additional 1 GW of new generation capacity per annum will be necessary to satisfy this growing demand.

Policy

Law 26.190, passed in December 2006, established that 8% of electricity demand should be generated by renewable sources by 2016. The Law also introduced FITs for wind, biomass, small-scale hydro, tidal, geothermal (all of which receive circa €2.6/MWh) and solar (circa €150/MWh). Tariffs are valid for a period of 15 years.

In addition, the GENREN program, initiated in 2009, called for state utility Energía Argentina Sociedad Anónima (ENARSA) to contract at least 1GW of renewable energy capacity, to be sold into the grid at fixed rates for a period of 15 years. In July 2010, the Government awarded PPAs to 17 wind farms with a combined capacity of 754 MW, 4 biodiesel power plants with an aggregate capacity of 110 MW, 5 small hydro plants amounting to 11 MW and 6 solar PV projects totaling 20 MW.

According to government data, in September 2010, Argentina was due to pay US$127/MWh (€93/MWh) to wind developers successful in the GENREN tender, which could be up to two-thirds more than in neighboring countries such as Brazil. Small hydro producers will receive around US$162/MWh (€119/MWh).

Access to finance

Argentina defaulted on its bonds in 2001 and has since had difficulty accessing the international credit market. A lack of support for project development from financial institutions continues to be a barrier to renewable energy development in the country.

That said, Argentina attracted US$743m (€546m) in clean energy investment in 2010, ranking it 16th among G 20 members. Its five-year growth rate for clean energy investment is 115% which places it second among the G 20.

Grid

Argentina has two interconnected grid systems. The Argentine Interconnection System (SADI) covers the upper three-quarters of the country, while the wind-rich Patagonia region is covered by the Interconnected Patagonian System (SIP).

At the end of 2001, as a result of the economic crisis, many electricity generators and distributors deferred making further investments in their networks. It is believed that the current transmission infrastructure is sufficient to support the build-out of the successful GENREN tenders; however, project development beyond this level will require significant investment in the transmission infrastructure.

Wind

Argentina has abundant unexploited wind resources, especially in the southern Patagonia region where capacity factors are well in excess of 45%. Current installed capacity stands at 32 MW, though the Government is targeting 1.2 GW by 2016.

Despite ongoing difficulties with project financing and low electricity prices, certain provinces have introduced local tax incentives. For example, Chubut, in north Patagonia, has approved legislation removing 100% of taxes on gross income from wind power in the first 5 years of operation, reducing to 50% in years 6 to 10. The province hopes such incentives will spur the build-out of an estimated 2.2-GW pipeline. 

Solar

Argentina’s eastern plains and north western regions are ideal for solar PV development. However, only 10 MW of solar has been installed in Argentina to date, making it a huge untapped resource. The Government has set a target of generating 3.3 GW of solar power by 2020.

Biomass

Argentina has historically focused on biofuel development rather than biomass, resulting in minimal installed capacity to date. However, it is estimated 80% of the country’s annual 6 metric tonnes of forestry biomass could be used to generate electricity, and Argentina’s planning ministry has received bids to build out 104 MW worth of biomass capacity.

Small hydropower

Argentina has introduced the Small Hydroelectric Program, which will conduct studies to identify potential sites and promote the development of small HPPs. The majority of the 30 MW of current installed capacity is located in the southern Andes region, which the Government expects to increase to 60MW by 2012.

Geothermal

To date, geothermal resource has mainly been used for heat recovery as opposed to power generation. Research into the country’s geothermal potential is still at an early stage, but the Government has set a target of 30 MW of electricity generation by 2012.

For more information on renewable energy development in Argentina, contact the report’s authors Enrique Grotz and Pablo Decundo.

Untitled Document

RELATED ARTICLES

Sunrise in Pakistan as the Country Delves into Solar PV

Robert Harker Pakistan has joined the list of countries that are exploring solar power as a means to bridge critical energy generat...

Global Renewable Energy Roundup: China, Kenya, Turkey, India Seeking More Renewables

Bloomberg News Editors China is being encouraged by three industry groups to double the nation’s solar-power goal for 2020 to make up for sh...

Why Smarter Grids Demand Smarter Communications Networks

Mark Madden

Historically, utility networks and communications networks have had little in common.

The Importance of “Switching Costs” to the US Residential Solar Industry

Paula Mints The DoE and numerous organizations and governments globally are focused on driving down the cost of solar convinced t...

PRESS RELEASES

OFS Announces Commercial Availability of InvisiLight® MDU Optical Solution for Multiple Dwelling Units

OFS, a leading-edge designer, manufacturer and supplier of innovative fiber optic netwo...

Intersolar AWARD „Solar Projects in India“ – Applications being accepted until September 18

The Intersolar AWARD in the category Solar Projects in India honors projects in the fie...

New local energy partnership brings innovative solar tracker to Washington State

A new partnership will bring the innovative AllEarth Solar Tracker solar electric syste...

30 days to GRC Annual Meeting & GEA Geothermal Energy Expo

The Geothermal Resources Council (GRC) has announced that it is only 30 days to go to t...

FEATURED BLOGS

Cronimet / THEnergy study: In solar for mines size does not always matter - Reducing CAPEX with energy efficiency and load shifting

Munich, September 2015. Mining companies are constantly gaining interest in solar solutions because frequently solar ...

Final Program Now Available for GRC Annual Meeting & GEA Geothermal Energy Expo

GRC Annual Meeting & GEA Geothermal Energy Expo - Final Program from

Vacancy? No Problem!

Have you ever tried to sell an efficiency product or service to a prospect that owns or manages a building with high ...

Shedding Some Light on a Taxing Situation for Community-Shared Solar

For renters and for property owners with inadequate roof space, the many benefits of solar electricity may seem out o...

FINANCIAL NEWS

CURRENT MAGAZINE ISSUE

Volume 18, Issue 4
1507REW_C11

STAY CONNECTED

To register for our free
e-Newsletters, subscribe today:

SOCIAL ACTIVITY

Tweet the Editors! @jennrunyon

FEATURED PARTNERS



EVENTS

Doing Business in South Africa – in partnership with GWEC, the Glob...

Wind Energy in South Africa has been expanding dramatically, growing fro...

Intersolar North America 2016

Exhibition: July 12 - 14, 2016; Conference: July 11 - 13, 2016 Intersola...

Intersolar South America 2015

Exhibition and Conference: September 1-3, 2015 Intersolar South America ...

COMPANY BLOGS

Less Is More

When you’re giving a presentation, one of the easiest things to do...

Captivology

One of the biggest challenges we face as efficiency sales professionals ...

How To Optimize Your Meeting Schedule

Do you spend more time in meetings than you do actually working? While m...

NEWSLETTERS

Renewable Energy: Subscribe Now

Solar Energy: Subscribe Now

Wind Energy: Subscribe Now

Geothermal Energy: Subscribe Now

Bioenergy: Subscribe Now  

 

FEATURED PARTNERS