Regulation of electricity utilities – power generation

Authorisation to construct and operate generation facilities

What authorisations are required to construct and operate generation facilities?

Regulatory permits and approvals to be obtained for the construction and operation of generation facilities depend on the type of power plant to be built. Thermal and renewable energy power plants do not require the granting of specific regulatory authorisations. Large-scale hydroelectric power plants and nuclear power plants require the granting of special concessions by the government, specifically in connection with the construction of the plants and the use of water. Additionally, federal and provincial environmental and safety regulation authorisations must be obtained for the construction of power plants.

Grid connection policies

What are the policies with respect to connection of generation to the transmission grid?

Connection of generation to the transportation grid requires the prior authorisation of the transportation concessionaire and the existence of capacity in power lines. If the generator’s requirement is not satisfied by the existing capacity of the transportation grid, transportation capacity shall be expanded with the prior approval of ENRE, the Administrative Company for the Wholesale Electricity Market (CAMMESA) and the relevant transmission company.

Alternative energy sources

Does government policy or legislation encourage power generation based on alternative energy sources such as renewable energies or combined heat and power?

In 2015, the federal Congress enacted Renewable Energy Law No. 27,191, later regulated by Executive Decrees 531/16 and 882/16. The Law, which amended Law No. 26,190 on the same subject, established mandatory targets for renewable energies: as of 2018, renewable sources must be no less than 8 per cent of overall electricity consumption, with a 20 per cent target for 2025.

As a consequence of Law No. 27,191, in 2016 the federal government launched ‘RenovAr’, a programme that contemplates a series of fiscal incentives and financial support mechanisms for renewable energy sources. Bidding processes called by the federal government during 2016 and 2017 proved successful and with a large number of awardees, many of them new foreign investors.

Law No. 26,190 invites provinces to adhere to the legislation and develop their own province-level incentives. Some provinces have enacted their own regulations regarding renewable energies (Buenos Aires, Law No. 12,603; Chubut, Law No. 4,389; Mendoza, Law No. 7,822; Misiones, Law No. 4,439; Neuquén, Law No. 2,596; and Santa Cruz, Law No. 2,796).

Climate change

What impact will government policy on climate change have on the types of resources that are used to meet electricity demand and on the cost and amount of power that is consumed?

Argentina has ratified the United Nations Framework Convention on Climatic Change (Law No. 24,295) and the Kyoto Protocol (Law No. 25,438). Argentina is not included among the countries that committed to reduce or limit carbon dioxide emissions. As a developing country, Argentina may participate and promote clean development mechanisms (CDM) through the federal Ministry of Environment. There are no proactive governmental measures promoting CDM.

Storage

Does the regulatory framework support electricity storage including research and development of storage solutions?

The Electricity Regulatory Framework does not contain specific provisions promoting research and development of storage solutions. Private consumers tend to implement domestic energy storage as a result of solar and wind generation.

Government policy

Does government policy encourage or discourage development of new nuclear power plants? How?

Law No. 24,804 regulates the nuclear industry. The federal government is responsible for establishing nuclear policy, regulating nuclear activity and carrying out relevant research and development.

Argentina has three nuclear power plants: Atucha I (launched in 1974: 335MW); Embalse (launched in 1984 and recently refurbished: 648MW); and Atucha II (launched in 2014: 745MW). Almost 5 per cent of Argentina’s electricity needs are covered by nuclear sources.

The federal government encourages the development of new nuclear power plants, most recently through the announcement of the construction of a fourth nuclear power plant, Atucha III, close to Atuchas I and II, with a 745MW electrical power capacity.