Renewables and Distributed Generation: Between Promises and Reality During COVID-19 Times
As the worldwide oil prices volatility show, the energy industry has not been left unaffected by the global crisis caused by COVID-19 pandemic.
During these hard times, it is worthwhile to wonder about the present and the future of the Argentinian electricity sector and the potential to turn the crisis into an opportunity.
In the attached report, we argue that price volatility of energy commodities and the current and future presence of health and environmental disruptive threats, advice to keep betting for diversification of the electricity mix as the best path to ensure security and continuity for long-term power supply.
Under this context, the report summarizes the main aspects of laws and regulations targeting renewable distributed generation which have shown strong consensus in the country as we further claim that fostering renewable distributed generation such as our current policy does, seems convenient under existing circumstances.
The report also includes preliminary remarks regarding the following issues:
1. Short-term relevant needs of the electricity sector
- Preservation of payment cash flow and short and mid-term economic and financial sustainability of all industry players.
- Termination of emergency under Law 27,741 during the legal period provided thereof and operation of the electricity sector under the rules of Law 24,065.
- Short-term focus for renewables
- Possibility of extending commercial operation dates and intermediate milestones in power purchase agreements corresponding to projects under structuring and/or advanced construction affected by the health crisis and measures adopted consequently either in Argentina or abroad.
- Assessing on a-case-to-case basis opt-outs and/or voluntary renegotiation of power purchase agreements for projects with no activity prior to March 12, 2020 (date under which the health crisis was declared), using uniform and non-discriminatory approaches.
- Long-term decisions
- Definition of transmission infrastructure expansion structure and planning for deployment for additional capacity of renewables for complying with the goal of 20% of consumption for 2025.
- Technical and financial evaluation of expanding such consumption target beyond 2025.
- Continuity of the electricity mix diversification, evaluating the role of efficient thermal, nuclear and hydropower technologies.
- Assessment of new technologies to strengthen the system and supplement the development of Distributed Generation, including power storage, smart metering, demand management and electric mobility.
- Assessment of opportunities to boost regional integration and cooperation for spot and long-term exchanges of natural gas destined to power generation and, power itself, with nearby countries.
In the following link, you can access the Firm’s statement on COVID-19.
For information concerning COVID-19 legal implications, please refer here.
