Chile and Argentina

Southern Cone watch: Climate change plan, grid management, transmission sale

Bnamericas Published: Thursday, November 03, 2022

Argentine energy transition measures will require estimated outlay of US$25.8bn.

So reads the executive summary of the country’s 2030 national climate change mitigation and adaption plan.

Produced by the government’s climate change cabinet, the plan comprises seven action areas corresponding to energy: skills development, energy efficiency, greenhouse gas emissions-free energy, hydrogen development, gas usage, energy system resilience and energy planning and monitoring.

“Transcending the fossil fuel paradigm implies a structural change in energy storage and utilization systems,” reads the plan, which synthesizes the country’s greenhouse gas emissions-reduction policies and contains measures and actions need to hit adaption and mitigation goals in its second Nationally Determined Contributions commitment.   

Energy accounted for 51% of Argentina’s total 2018 emissions of 366Mt of CO2 equivalent. 

The plan underscores the risk that drought – which limits hydropower output – and insufficient generation park diversification presents. 

The overall plan comprises six strategic action areas: energy transition, productive transition, sustainable mobility, resilient and sustainable territories, conservation of biodiversity and public assets, and sustainable management of food systems and forests. Overall associated outlay is pegged at around US$113bn.   

Argentina has a goal, established in law, of obtaining at least 20% of its electricity from non-conventional renewable sources by end-2025. Over the first nine months of the year, the proportion averaged 13.5%, implying a rapid buildout is required over the next few years to comply. 

The Mater term market is currently driving growth of the country’s renewables park. Of Argentina’s installed grid capacity of 42.9GW, combined-cycle thermoelectric plants account for the biggest chunk at 13.5GW, followed by hydroelectric at 10.8GW. Wind accounts for 3.29GW and solar 1.08GW. Gas-fired, diesel, mini-hydropower, nuclear, biomass and biogas plants account for the balance. 

Argentina needs to increase power transport capacity to help support continued renewables growth, particularly in wind and solar resource-rich areas. Plans to expand the 132kV system using multilateral funding are underway.

The country – working apace to boost hydrocarbons output from the oil and gas rich Neuquén basin – has pledged to achieve carbon neutrality by 2050.

Argentine officials are due to present the plan, along with a 2050 low-emissions resilient development plan, at COP27 in Egypt this month.


Public and private power sector officials met again this week to discuss the situation in the short-term electricity market in Chile.

The working group, led by national energy commission CNE, was formed last month after some renewables generators reported payment chain stress linked to power curtailment and price differences between the various nodes of the national electricity system, and in turn, connected to grid congestion. 

The chief objective of the working group is to analyze the situation and establish what steps to take.

Camilo Charme, CEO of Chilean power generator association Generadoras de Chile, said curtailment was experienced by power systems that incorporate growing levels of renewables capacity, and that active management was needed in order to give decision-makers the correct signals.  

He added: “Globally, renewables development is resulting in increased decoupling and a reduction in spot prices in those zones, which underscores the importance of better planning and active management of the transmission network.

“While zero marginal costs are not a market failure but rather a reflection of the availability of power at a determined time and place, the situation makes it necessary to complement the market with long-term contracts.”


Chile’s competition court FNE greenlit the proposed US$1.35bn purchase by Grupo Saesa of Enel Chile unit Enel Transmisión Chile.

In related M&A news, FNE is examining the proposed acquisition by Engie Energía Chile of companies Alba, Alba Andes, Alba Pacífico, Energías de Abtao, and Río Alto.

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