Category Archives: Argentina

Argentinean Deja Vú

When we were still celebrating RenovAr Program renewable energy MW auction success, in Dr, Jekyll and Mr. Hyde best style, Argentina goes up Delorian again and returns … to the past!

Government has announced millions of investments, including disbursements in nuclear and thermal generation.

Yes, you read well … nuclear.

Most of disbursements are geared to generation based on gas and other fuels.

Again, you read well … gas and other fuels.

The so-called 21 Resolution created very attractive conditions for private companies, so investments of up to US$ 3 billion are planned to install 2990 MW, of which bulk should be ready this year.

The reward for private capital has to be very high to invest in a high risk country.

But why such a hurry?

It happens that renewable energy projects, which are expected to disburse US$ 3.5 billion to install 2423 MW, are mostly not ready until 2018 and will be completed only in 2019.

In addition, some renewable energy projects could be delayed because of difficulties in financing accessing.

And since there are not many private companies that are encouraged, it is State that will also invest and manage.

We already know how this story ends.

Resultado de imagen de deja vú

Apocalypse horseman banished from practically all developed economies, nuclear energy, is welcomed with open arms in Argentina.

Near Atucha I central (Buenos Aires province) will be built Carem 25, the first nuclear central entirely designed and built in the country.

This project had been announced by previous administration on February 8th, 2014, but as in many other cases, it was announced and practically nothing was done.

On the other hand, before end of July government will inform in which site of San Matías Gulf (Río Negro province) another nuclear power generating plant will be installed.

Municipalities of Viedma, San Antonio Oeste and Sierra Grande, which make up the Gulf, were declared non-nuclear zones by respective ordinances approval.

Local representatives have already protested against nuclear plant installation and have requested that same investment be made but in renewable energies.

If materialized, it would put at risk the rich marine biodiversity of a protected natural area.

It will also be invested in a uranium processing plant in Formosa province.

Resultado de imagen de atucha i

When at global level there is a commitment to a change in energy matrix towards renewable energies greater participation, distributed generation promotion and nuclear energy abandonment; Argentina does the opposite in pursuit of its desperate investments search at any price.

The values and principles outlined in RenovAr Program are trampled by the electoral agenda and a short-term vision.

It is a story that repeats itself no matter what political party is in government.

It will be very difficult to overcome the obscene swindle of Río Turbio coalfield perpetrated by previous government, but these announcements represent a step back in the configuration of a modern and sustainable national energy matrix.

All you need is Sun. All you need is Sopelia.

2017: The Year In Which Argentina Made Renovable

The year 2017 in Argentina is the break point between a disastrous past and a future that can be plentiful in renewable energies field.

In RenovAr Program rounds 1 and 1.5, 2,423 MW of renewable energy projects have been awarded.

The always old-timers will say (and in some cases with reason) that many projects will not be realized.

The surprisingly low award prices and the increase in financing costs provoked by the white house tenant change make doubtful some projects profitability.

Especially the 60% that was not developed by Chinese origin promoters. The latter have the handicap of unattainable financing for the rest, but they will also have difficulty coping with the high “Argentine cost”.

The truth is that much of them will become reality and renewable energy participation in the country’s energy matrix will begin to be relevant (Law 27.191 objectives of 8% in 2017 and 20% in 2025).

Resultado de imagen de solar térmica argentina

On distributed generation side, the impulse is given by solar thermal energy, which in locations without natural gas network access is already more profitable than all other energy sources.

In addition, those who are developing new constructions in locations with natural gas network access and do not incorporate solar thermal energy in their projects, are making a serious mistake.

Energy tariffs will continue with their irreversible sincerity process.

Photovoltaic distributed generation is more difficult because involves a more important initial investment and a longer repayment term.

In locations with electricity grid access is being developed almost exclusively for lighting applications in complement with LED technology.

In isolated locations for houses electrification, water pumping, signaling and communications.

This situation is going to change throughout this year.

Decree 531 establishes the purchase mechanisms (private contracting, self-generation or cogeneration or participation in a joint purchasing mechanism) for users with energy demands equal to or greater than 300 kW; which must cover at least 8% of the total electricity consumption from renewable sources by December 31, 2017.

Sopelia is advising many companies that have already taken the first step: develop solar energy projects on the paper to evaluate purchase mechanisms versus self-generation in order to achieve (and even surpass) the required percentage.

Solar is the renewable energy with urban environment integration highest level and these companies can take advantage of their roofs to place photovoltaic or thermal systems.

Resultado de imagen de solar fotovoltaica argentina

All companies that make intensive electrical energy use or include fluids heating in their production process should elaborate these projects on paper to make the right decisions with real information that accurately reflects their particular situation.

The government could accelerate this transformation process by:

* Regulations that oblige solar thermal systems incorporation in all new construction, in Spanish CTE style

* Implementation of a serious plan (installed capacity objectives, deadlines and compliance measures of those objectives, measures to correct deviations) that really favors the distributed photovoltaic generation development in residential, commercial, services and industrial sectors

* Impulse of interconnection infrastructure investment by energy distribution companies

* Conducting a thorough study to reduce import tariffs on renewable inputs and equipment that can hardly be manufactured in short and medium term in the country.

Renewable energies put Argentina in front of another opportunity (and go …) to end its sad paradox:

Having enormous natural resources and never making a correct use of them for benefit of all its citizens.

Solar energy wherever you are with Sopelia.

Argentina: The awakening of the sleeping giant

After more than 10 years of lethargy caused by the populist “siesta”, the renewable energy sector of Argentina needs to regain lost time.

Such projects development requires a context of political and economic stability and we could say, using the football jargon, that Argentina is “preparing the stadium for playing the match”.

Next Friday 22nd April the country is preparing to cancel the debt with creditors that did not enter 2005 and 2010 swaps, and thus leave behind a default that lasted nearly 15 years.

The other leg of the table is the 531 decree of March 30rd 2016 that establishes mechanisms for achieving the goals of 8% in 2017 and 20% in 2025 (referred in 27,191 law) of electricity generation through renewable sources.

Making a flashback we can infer that to achieve such ambitious goals, the speed will be exciting:

In 2006 was set as a target for 2016, that Argentina would reach 8% of electricity generation by renewable sources.

The numbers indicate that so far in 2016 barely exceeded 2%.

That is, just over 25% of the objective reached.

And as has already occurred in the sector of renewable energies elsewhere, when hurry is need who take the initiative will get the duck to the water.

Decree 531:

* Create the trust fund of U$D 820 million “Fund for the Development of Renewable Energies” (Foder).

* Set purchase mechanisms (including hiring, self-generation or cogeneration or participation in a joint procurement mechanism) for users with power demands equal to or greater than 300 kW; which should cover at least 8% of total electricity consumption from renewable sources by 31 December 2017.

* Contemplate the possibility of quotas for technologies in bids (price “may be established” in US dollars).

* Establish more favorable conditions for national components use in projects and are planned instruments to encourage local production of components.

Sopelia develops activity in the Argentine solar sector since 2011 with its local partner Puerto Hueche S.R.L .. Engineer Nahuel Rull says:

“Can access the “RENEWABLE ENERGY PROMOTING SYSTEM” individuals domiciled in the ARGENTINA REPUBLIC and legal entities created in the ARGENTINA REPUBLIC, holders of investment projects of electricity generation from renewable sources”.

“The company provides the following services:

– Presentation to the Enforcement Authority of documentation needed to obtain the Certificate of Inclusion in the “RENEWABLE ENERGY PROMOTING SYSTEM” and to the allocation of promotional benefits

– Individual renewable sources electricity procurement

– Solar energy self-generation and cogeneration projects management

– Management of joint purchases of renewable electricity to the body designated by the Enforcement Authority.

– Foreign investors and EPCs support”

For not flooded fields or lands owners, located in northern Argentina that have 5% maximum slope, an attractive business opportunity presents itself: the photovoltaic solar energy. Also for large roofs or covers owners of the same region.

For investors who want to increase their portfolio of renewable energy projects, it is time to focus on Argentina.

For users with power demands equal to or greater than 300 kW countdown began: have 20 months to consume at least 8% of their electricity total consumption from renewable sources.

Starting gun sounded.

Solar Photovoltaic Argentina

The Argentine photovoltaic market is segmented into 3 types of applications:

1- Rural uses.

The demanded equipment are for electrification of rural housing posts (50W-80W); lighting systems (30W-100W); to feed water pumps that replace the traditional multi-blade mills (50W-400W).

2- Professional or business purposes.

Providing energy to telecommunications systems (100W – 400W), telemetry, markings, signage, highway emergency systems (20W – 50W), cathode protection and pipeline shutoff valves (over 20kW).

3- Institutional demand.

Includes social assistance programs, power regulating entities, organizations and state (provincial) energy companies. Equipment requests for lighting and electrification of schools, medical centers, police stations and residential users. Powers between 50W and 400W.

Until the year 1999 the demand for PV modules remained steady between 20% and 50% annual growth. From that year on, and especially after the devaluation in 2001, demand for these modules has suffered a sharp decline that has begun to reverse since 2004.

There is no domestic solar modules manufacture.

With approximately 1 to 2 MW of installed power per year, mainly in isolated applications, it seems that the only way for this market to grow is through the development of large-scale projects.

In conclusion: government authorities have not learned the lesson taught elsewhere.

Efforts should be focused on distributed systems’ installation and integration of PV in urban environments, developing residential, secondary and tertiary sectors.

The future of a solid and consistent solar PV sector clearly requires the development of:

1) A limited number of grid connected big projects.

2) Encouraging installations on residential and businesses roofs on the basis of a net metering or feed-in payment.

Currently there is no feed-in payment for solar residential electricity.

There are purchasing agreements granted in the solar electricity program GENREN of US$ 572 / MWh (Three times the average of the PPA agreements awarded in the rest of Latin America).

In the city of San Juan, a facility that used a combination of fixed and followers, polycrystalline, mono-crystalline and amorphous silicon cells structures was inaugurated in 2012.

It has 1.2 MW and has become the first solar photovoltaic plant connected to the national network of integrated power system in South America.

At domestic levels, investment in a solar PV system is recovered in about 5 years compared to a fuel generator.

Compared to the electricity network, the figures are radically different.

The electricity network has an approximate price of US$ 47 per MWh against US$ 142 solar MWh.

In other words, solar electricity costs triple the network. In this scenario, the solar investment would be recovered in 98 years (more than 3 times the equipment’s life).

The paradox is that according to an analysis by the Environmental Protection Agency of the City of Buenos Aires (APRA) each MWh that adds to the country, provided by thermal power plants, costs US$ 344.

Therefore, thermal power plants (the majority in country’s energy matrix) are selling to end users 7 times cheaper than the actual cost of producing and transporting electricity.

In addition to this, about US $ 15,000 million annually are used to import fuels.

In short, lack of common sense and any planing.

If the electricity price of other cities within the region (Santiago, Montevideo and San Pablo) was paid in Buenos Aires, the solar system investment would be recovered in 12 years.

From 2016, we will see if political change in the country will lead to the end of energy crisis and sustainable development of solar photovoltaic energy.

Solar Thermal Argentina

In terms of solar thermal energy, Argentina has entered a process of incorporating this technology taking the construction sector as an engine for market development, in absence of laws and regulations to boost it.

There are isolated initiatives. In fact, there are municipalities with Bills or solar ordinances, such as the city of Rosario.

But we could say that the field of solar thermal energy in Argentina is still in diapers.

Up to today, year 2015, there are no comprehensive measures of solar resources available, equipment have not been subjected to testing or certification and have no market sector statistical information.

Generally thermo-siphon systems are installed for DHW heating in houses and townhouses where there is no access to the gas network. Equipment for pool heating are also installed.

A 2009 estimate indicates that around 2,000 m² (about 22,000 ft²) of collectors were installed that year and were about doubled in 2010, reaching 4,000 m2 (about 43,000 ft²).

Flat collectors then constituted 2/3 of the market with a large proportion of domestic products, being vacuum tubes the most imported collectors.

In 2015, it is calculated that above 30,000 m² (around 323,000 ft²) collector capacity was installed; half of them for heating outdoor pools.

Most companies in the sector are located in the Central Region (mainly in Buenos Aires) and the Northwest Region is the one with the largest area of collectors installed, followed by the Northeast.

How could this technology’s sustained development be boosted ?

As far as the public sector is concerned, it would require:

– Elimination of the competitive disadvantage caused by high subsidies for electricity and gas network.

– Standards sanctioning and incentives creation.

– Set an example by incorporating solar systems in its infrastructure facilities.

As for the private sector, it would require:

– Introducing improvements in product quality.

– Training skilled labor on sizing and system design, installation and maintenance.

– Facing the additional challenge of foreign competition, in some cases, with equipment at a lower cost and better performance than those of domestic manufacturing.

Only in the residential sector, there is an estimated potential of 6 million m2 (about 65 mill ft²) for the production of DHW; 2.2 million m2 (around 24 mill ft²) in the public, commercial and services sectors, plus a significant potential in the industrial sector.

Considering 20 years of useful life for a thermal solar system, full investment could be recovered in about 15 years in Buenos Aires province, for instance, when compared with actual price of gas network and considering its level of insolation.

However, in cases of bottled gas and electricity, solar thermal power technology is already profitable in many parts of the central and north regions of the country.

Compared with bottled gas, investment in solar thermal systems could be recovered in 2 years.

Compared with the use of an electric water heater, investment in solar thermal systems could be recovered in about 5 years.

A consistent solar thermal market would provide several benefits to the country:

– Reduction in conventional energy demand.

– Reduction in energy imports

– Reduction of greenhouse gases’ emissions.

– Creation of a new industry sector and new jobs.

– Creation of a national industry sector with high added value.

Solar Argentina

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.