In 1992, Argentina divided the public electricity sector in generation, distribution and transmission, and sold it to private investors.
When the 2001-2002 economic crisis shook the country and its currency was devalued, the government, fearing the political cost an electricity price increase would cause, froze natural gas prices and end users tariffs in 2002.
The solution worked in the short-term, but stopped the exploration of new energy sources and investment in infrastructure improvements by foreign investors.
The national natural gas extraction declined, leaving power generation facilities unused and increasing energy imports.
With the economic recovery, demand for energy soared by an average of 5% a year since 2003.
Enarsa was created in 2004 with the primary mission of exploring and extracting hydrocarbons, oil and natural gas; plus transportation and distribution of these resources. However, power failures remain a problem.
Argentina has invested heavily in a renewable resource: water. This resource accounts for about 35% of electricity, so a greater diversification is necessary to avoid the problems a severe drought would cause.
Oddly enough, judging by the development it has taken so far, Argentina is one of the countries with the highest potential for renewable energies.
Argentina could supply all of its electricity consumption with renewable energy, and could even become a net exporter.
In 2006 the regulatory framework was established with the enactment of Law 26.190/06, giving renewables a national interest. It was set as a target for 2016, that Argentina should reach 8% of electricity generation from renewable sources.
Current figures indicate that in 2016 it will barely exceed 2%, achieving, therefore, only a little more tan 25% of the objective.
In 2009, the national government launched with Enarsa (the public energy company) the GENREN program, which offered to buy 1.000 MW of renewable energy by 15-year fixed contracts.
In June 2010, after an exhaustive analysis, the winners were announced and a total of 895 MW were approved.
Most of the bids were for wind energy.
Even though the central and northern parts of the country enjoy many sunshine days throughout the year that would allow many applications to take advantage of solar energy, only 20 MW photovoltaic solar energy projects were granted in the province of San Juan.
Economic instability in recent decades contrasts with the expected energy crisis in which Argentina is sinking ever more rapidly.
With rates that do not reflect the true cost of resources nor the need for investment and a subsidies policy that will soon come to an inevitable end, renewable energies gain a value that they never had before.
Uncertainty about the availability and value of energy in the future is a question that only the state can solve with energy planning and implementing public policies, promoting energy efficiency and clean energy.