Argentina: Renewables and Energy Transition - Policy and Latest Developments

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Legal and policy framework

Power sector regulations: main features

The Argentine power sector is governed by Law No. 4,065 and its regulations, Decree Nos. 1398/1992 and 18619/95, and Resolution No. 61/1992, among others (the Regulatory Framework).

The Regulatory Framework is characterised by the following main features:

  • There is a vertical division of the power sector into four categories: (i) generation; (ii) transmission; (iii) distribution; and (iv) demand, with cross-ownership restrictions between some of these categories.
  • As a general rule, the operation of power generation plants (including both solar and wind) do not require any specific concession, although regulatory, safety, transmission and environmental clearances are required, and to build and operate a hydroelectric generation facility, a concession must be obtained.
  • Power generation can be carried out within a competitive market environment in the electricity wholesale market (MEM) where large users can purchase power directly from generators or traders. Currently, the execution of thermal power purchase agreements (PPAs) has been mostly centralised and delegated to CAMMESA , the company that administers the MEM, by the Secretary of Energy.
  • Transmission and distribution companies are regulated as public utilities.
  • Transmission services are provided by concessionaires that own and operate high- and medium-voltage transmission lines. The business involves the transformation and transmission of electricity from the generators’ delivery points to the reception points of distributors or large users.
  • Open access to available capacity is one of the key obligations of transmission companies.
  • Distribution companies supply end users whose consumption level prevents them from entering a contract for their power supply independently.
  • The rates charged by transmission and distribution utilities are determined by government agencies. The Argentine Regulatory Agency for Electricity (ENRE) is the autarchic entity that determines the rates charged by transmission and distribution utilities subject to federal jurisdiction.

Renewable energies

General overview

In 2015 the Argentine Congress passed Law No. 27,191 which introduced substantial amendments to the Federal Promotional Regime for the Use of Renewable Energy for Power Generation, previously approved by Law No. 26,190.[1]

One of Law No. 27,191 main highlights was to amend the short- and long-term renewable consumption objectives, establishing an 8 per cent target by 31 December 2017 and a 20 per cent target by 31 December 2025, with intermediate targets. The objective for 31 December 2023, is 18 per cent.

Additionally, pursuant to Law No. 27,191 large users (ie, consumers with a demand equal to or larger than 300kW) must source a minimum level of their electricity consumption from renewable sources. To meet this requirement large users have the following alternatives:

  • purchase power through a corporate renewable PPA;
  • purchase power through a corporate renewable PPA; and/or
  • use CAMMESA’s joint purchasing system (default option).

Law No. 27,191 also created different tax incentives and exemptions. However, the economic impact of these benefits has been reduced substantially and at present is no longer a determinant factor for new renewable energies projects.

Finally, it was established that (i) power from intermittent renewable resources enjoy the dispatch priority given to run-of-the-river hydropower plants (ie, the highest priority under the Regulatory Framework); and (ii) neither renewable energy self-generation plants nor plants that generate energy from renewable sources to be sold under PPAs need have dedicated back-up capacity.

Corporate PPAs: MATER

Corporate PPAs are not a new phenomenon in Argentina; on the contrary, the power regulatory framework in place since 1992 provides rules to encourage large users to enter into PPAs directly with power generators. However, PPA regulations in the past have only contemplated the existence of conventional sources (mostly thermal power stations).

For this reason, at first[2], the renewable market was mostly composed by PPAs with CAMMESA awarded by the Secretary of Energy. This initial trend started to shift towards a corporate market through Resolution No. 281/2017 of the Argentine Ministry of Energy and Mining (currently, Secretary of Energy), which established a set of rules for the corporate renewable PPA market (MATER).

Corporate PPAs do not have to be approved or authorised by any government agency[3], but they must be registered with CAMMESA. The minimum terms CAMMESA requires to register a PPA include: (i) duration; (ii) price; (iii) contracted energy (on month and annual basis); (iv) termination events; and (v) priorities (in case the project has more than one off-taker, which is generally the rule). It is not necessary to actually submit the PPA that can remain a confidential document, CAMMESA only requires a registration form.

According to information available at CAMMESA’s website[4], as of September 2023, there were more than 2,600 registered corporate PPAs for over 3,000,000 MW-h.

Access to transmission capacity

General rules

Open access to existing transmission infrastructure is one of the main features of the power sector regulations and a key obligation of transmission companies.

Access to existing transmission capacity must be requested by the project’s developer to the corresponding transmission utility including different information; primarily, technical studies of the transmission system providing evidence of the feasibility of the request.

Following this application, both CAMMESA and the relevant utility must analyse the technical feasibility of the request. Their assessment will then be informed to ENRE, and a public hearing might be required before the access to transmission capacity permit is granted.

First dispatch priority regime

Notwithstanding the general proceeding to secure the transmission capacity permit and the rule pursuant to which renewable energies enjoy the highest dispatch priority, because of existing restrictions to transmission capacity, Resolution 281 established a mechanism to award ‘first dispatch priority’ (ie, a kind of preference sub-ranking among renewable projects).

In essence, this mechanism establishes that ‘first dispatch priority’ shall be requested to CAMMESA and, if granted, to retain this priority, the project’s developer would have to pay a quarterly fee of US$500 per MW of installed capacity until the project reaches its commercial operation date (COD).[5]

According to information available at CAMMESA’s website, as of September 2023, 95 projects have requested ‘first dispatch priority’ pursuant to the mechanism established by Resolution 281.


Hydropower is very important for Argentina. Hydroelectric installed capacity is more than 10,800MW and generally represents 30 per cent of the total annual consumption of electricity.[6]

Hydroelectric power plants include two binational projects that are subject to a different legal framework[7] and different local projects, located in different provinces.

Among the local projects, there are several power plants that were privatised by the government during the 90’s within the programme that privatised the majority of the existing state-owned energy assets following the enactment of the Law No. 24,065.

Most of the concession agreements had a 30-year term that, in some cases, finishes in the next couple of years. In fact, between 2023 and 2029 20 concession agreements would be terminated.

The Secretary of Energy recently determined that the concessionaires of the three hydroelectric power plants with agreements terminating in 2023 will continue to operate the power plants for up to one additional year during a transition period.[8]

It is unclear if the government will reassume the operation of the hydroelectric power plants after the termination of the relevant concession agreements or if it is going to promote a public bidding to award such operation to new concessionaires.

Low-emissions hydrogen

To take advantage of the momentum behind hydrogen the Secretary of Energy prepared a Bill for the Promotion of Hydrogen with Low Emissions of Carbon and other Greenhouse Gases (the Hydrogen Bill), which is currently under analysis by the Chamber of Deputies[9] and published Argentina’s National Hydrogen Strategy.[10]



During 2022 and 2023 the MATER (corporate renewable PPAs market) was very active, and 47 projects requested first dispatch priority to CAMMESA.

The demand for renewable PPAs is strong and it is not only driven by the sustainability policies or ESG goals of the off-takers. In Argentina, for a large user, is generally less expensive to purchase electricity directly from a renewable generator than to purchase it from the grid administrator CAMMESA. Furthermore, large users are, as a rule, barred from purchasing electricity directly from a thermal generator.[11] This prohibition creates an important distortion in the Argentine electricity market and moves the scale in favor of renewable projects even further.

Based on information from 2022, the average price charged by CAMMESA to large users was US$88.7 per MW-h. Although prices are not publicly available, MATER prices were approximately US$ 65 per MW-h during 2022.[12] This means that purchasing renewables represents a cost reduction on the energy bill of more than 25 per cent. For energy intensive users this is clearly a huge cut. 

These figures have not changed substantially during 2023 and are not expected to change much in the next couple of years.  

This price difference, coupled with challenges faced by renewable energy generators to secure financing, have led to the execution of many prepaid PPAs. This type of agreements is very similar to traditional PPAs, with one significant difference: instead of purchasing electricity over time, large users purchase electricity upfront and help with the project’s financing.

Marval regularly advises both independent power producers and large users in connection with the negotiation of prepaid corporate renewable PPAs and one of the most complex issues with this type of agreement is the guarantee scheme because of the challenges for long-term agreements created by recurrent macroeconomic crisis.

Although the demand for corporate renewable PPAs continues to be high, the development of certain renewable projects at present is being stopped because of restrictions to transmission and transformation capacity.

In this context, the Secretary of Energy prepared a programme for the extension of existing transmission and transformation capacity;[13] and launched a call for expressions of interest to manage and finance extension works of the high-voltage transmission infrastructure.[14] The call for expressions of interest was mainly directed to intensive users of electricity (eg, mining companies) that have expressed an interest in extending the existing transmission infrastructure to allow new renewable energy generation.

Chances are that following this call for expressions of interest the Secretary of Energy would enact new regulations regarding the extension of transmission infrastructure or open a public bid process for private parties to present offers to provide the required works, or both.

From oil & gas to energy companies

The Argentine market is not strange to the shift of oil and gas companies towards the power industry. Different long-standing Argentine oil and gas companies like Tecpetrol, Pan American Energy (PAE) and YPF have been investing in renewable generation projects in the past years.

A good example of this trend is a recent asset swap between TotalEnergies and the Pampa Energía (one of largest integrated energy companies in Argentina). In this deal, Marval advised TotalEnergies in the purchase of a 100MW wind farm called Mario Cebreiro from Greenwind, a subsidiary SPV of Pampa Energía. The wind farm was paid through an assignment to Pampa Energía of TotalEnergies’ percentage interests in the hydrocarbon concession called Rincón de Aranda, located in the Province of Neuquén, Argentina (Vaca Muerta basin).

It is likely that this trend will continue, and Argentine oil and gas companies will probably continue their shift towards integrated energy companies.

Critical minerals: lithium and copper prospects

In addition to investing in renewable projects, as part of their energy transition policies, Argentine oil and gas companies have also been looking into lithium and copper projects.

It is well-known that lithium batteries, as an option for rechargeable energy storage, have created a strong demand for lithium. Argentina holds over 20 per cent of the worlds reserves and has the world’s largest lithium project pipeline.[15]

The demand for copper is expected to steadily increase as the electrification of the economy progresses and it has been said that copper ‘is the missing ingredient of the energy transition’.[16]

Argentina also has extensive reserves of copper and if the projects underway come online as expected, the country could become one of the top 10 worldwide producers.[17]

Among other transactions, between 2022 and 2023 the Marval mining department advised PAE (i) in its due diligence and acquisition of lithium mining properties in the Province of Salta held by Trilogy Minerals Pty Limited; (ii) in its due diligence of a mining project in Catamarca held by Puna Group SA and the execution of a tenement purchase agreement and exploration agreement; (iii) in its due diligence of a mining project in Catamarca and Jujuy held by Integra Recursos Naturales SA and Integra Recursos Naturales Minerales SA and in the negotiation of the transaction documents; and (iv) in the public bidding of a mining project held by Jujuy Energía y Minería SE.

During 2023 Marval mining department also advised Glencore International AG in its acquisition of Pan American Silver’s shares in the copper integrated project Minera Agua Rica Alumbrera.

As part of their decarbonisation efforts, we have seen different multinational automotive companies with local presence focus their attention on lithium and copper projects in Argentina. For example, Marval mining department advised Stellantis (Fiat Chrysler-Peugeot Citroën Group) in the acquisition of the 14.2 per cent of McEwen Copper Inc in the Los Azules Project.

Opportunities and challenges

Investment opportunities

In the upcoming years, the main opportunities in the Argentine clean energy sector will likely relate to (i) renewable energies; (ii) transmission and transformation infrastructure; (iii) hydropower; (iv) low-emissions hydrogen; and (v) lithium projects.

Renewable energies

Argentina has world-class renewable resources,[18] political consensus regarding the importance of the development of renewable energies[19] and a strong local demand for more renewable energy. The combination of these three factors creates many investment opportunities, notwithstanding the challenges that are addressed below.

Considering the limited availability of public funding and the fact that the government has been paying for PPAs with CAMMESA through monetary expansion, the most financially sustainable investment opportunities will relate to corporate PPAs or off-grid projects for energy intensive users, or both. Particularly, mining companies that need to add renewables to their electricity supply to reduce their carbon footprint.  

Transmission and transformation infrastructure

Restrictions to transmission and transformation capacity are currently limiting the development of many renewable energy projects.

The government has estimated that by 2035: (i) 11,800 km. of transmission lines need to be built (this represents an increase of more than 36 per cent of the existing infrastructure); and (ii) 16,000MVA (Mega Volt Amp) of transformation capacity must be installed (this represents an increase of more than 42 per cent of the existing infrastructure).[20]

According to government, the necessary investment to finance the programme for the extension of existing transmission and transformation capacity prepared by the Secretary of Energy will amount to more than US$10 billion dollars.

The need for infrastructure and the limited availability of public funding create interesting investment opportunities in the transmission and transformation of energy sector.


If the government promotes public biddings to award the operation of hydroelectric power plants or other types of public-private partnerships, there could be interesting investment opportunities in the hydropower sector as well.

Low-emissions hydrogen

Argentina has abundant potential as an exporter of low-emission hydrogen and its derivatives, in particular, thanks to its world class renewables resources and vast amounts of natural gas.

At present, there are many ongoing green hydrogen projects in the early stages of development.

If the demand for low-emissions hydrogen and its derivatives materialises, and provided the challenges summarised below may be overcome, it is highly likely that Argentina will offer excellent investment opportunities in this sector.

Lithium and copper projects

In February 2023 the government published reports including a portfolio of both lithium and copper projects. These reports show a survey of copper and lithium projects that were prepared with publicly available information, and they are indicative of the government’s interest in promoting investments in this sector.[21] Particularly, because copper and lithium exports are being considered as one way to bring in much-needed foreign currency.  

These reports also show that there are many projects lithium and copper in progress, but they could only be developed with a substantial inflow of direct foreign investments.

Main challenges ahead

Argentina’s critical macroeconomic situation and a gap of more than 100 per cent between the ‘official’ exchange rate and the market exchange rate create different challenges for long-term investments in the energy sector.

At present, the most complex market challenges for investing in Argentina are related with import and FX restrictions.

To preserve the very limited foreign exchange reserves of the Argentine Central Bank, the government has been imposing stringent import barriers and regulatory burdens that adversely affect importers. At present, there are strict limitations that affect the ability of importers of accessing to access foreign currency to make international payments.

Argentine exporters of goods must repatriate export proceeds and this repatriation must be done using the ‘official’ exchange rate. Although Argentina’s foreign exchange market rules change continuously and there are certain exceptions as well as different promotional regimes, to put it simply, exporters get far fewer Argentine pesos for every US$ of income than the market value of their exports.

Additionally, FX controls restrict the access to ‘official’ US$ for the payment of profits and dividends to non-Argentine resident shareholders; and cross-border loans; among other restrictions.  

These FX controls and restrictions make it very difficult to secure the financing for projects in Argentina.

In addition to existing market challenges, the Argentine electricity sector is financially unstainable and relies heavily on government subsidies to CAMMESA.

A report from Fitch Ratings has precisely explained the current situation as follows:

Counterparty risk with CAMMESA could increase, jeopardizing Argentine electric utilities’ cash flow, with deterioration in credit metrics having the potential to lead to negative rating actions. Increased subsidies will also elevate risks to the fiscal deficit necessitating greater central bank funding, which in turn will further exacerbate inflationary and exchange rate pressures.[22]

The unsustainability of the electricity sector is intertwined with the country’s critical macroeconomic situation, and certainly increases the difficulty for securing financing for energy projects in Argentina.

There are certain legal alternatives and strategies to mitigate and to a certain extent reduce the exposure to the abovementioned challenges. However, the impact of these measures is limited and, although the prospects for energy transition investments in Argentina are promising, at present, those investments are highly complex.  

The newly elected Argentine president, Javier Milei has announced that currency controls will be gradually lifted and that he will call the Argentine Congress into extraordinary sessions to discuss a large package of reforms to stabilise Argentina’s economy and several measures that may have a substantial impact on the Argentine power sector.


[1] Pursuant to Law No. 27,191 renewable sources of energy consist of non-fossil sources of renewable energy suitable for a sustainable use in the short-, medium- and long-term, including wind energy, solar thermal energy, solar photovoltaic energy, geothermic energy, tidal energy, wave energy, energy from ocean currents, and hydroelectric plants of less than 50MW.

[2] Mostly between 2009 and 2017.

[3] This is notwithstanding the applicable regulatory, safety, transmission and environmental clearances and the required concession for hydroelectric power plants.

[5] The quarterly fee might be increased by CAMMESA in the event the project does not meet its committed COD.

[6] This percentage can fluctuate because of the level of precipitations.

[7] Yacyretá (3,100MW), which is owned in conjunction with Paraguay and Salto Grande (1,890MW), which is owned in conjunction with Uruguay.

[8] Resolution No. 815/2023 of the Secretary of Energy, published in the Official Gazzette on 9 October 2023.

[9] The Bill was signed by the President, the Ministry of Economy and the Chief of Staff pursuant to docket No. 0005-PE-2023.

[11] In March of 2013, the Secretariat of Energy through its Resolution No. 95/2013 (Resolution 95), among other measures, ‘temporarily suspended’ the possibility to celebrate new PPAs and forced large users to purchase power from CAMMESA rather than directly from generators or traders. Resolution 95 is in direct contradiction to Law No. 24,065 but to the best of our knowledge has not been challenged. as of 2013 and by virtue of Resolution 95 (as well as other de facto delegations), CAMMESA became the sole purchaser and manager of fuels consumed by the electricity sector, as well as sole off-taker of electricity regarding existing generation facilities under regulatory remuneration schemes and sole supplier regarding large users.

[13] Resolution No. 507/2023 of the Secretary of Energy approved the following plans: (i) the Extra-High Voltage Electric Power Transmission System Expansion Plan (500kV); (ii) the Existing Extra-High Voltage Electric Power Transmission Stations Revamping Plan (500kV); (iii) the Existing High and Medium Voltage Transformer Stations Revamping Plan (132kV); and (iv) the High and Mid Voltage Electric Power Transmission System Expansion Plan. A Spanish version of the proposed expansion plan is available at:

[14] Resolution No. 562/2023 of the Secretary of Energy.

[16] Schumpeter, The coming copper crunch, published at The Economist (April 2023).

[18] For example, according to a report published by CAMMESA, in September 2023, the on-shore wind farm called ‘Los Olivos’ reached a capacity factor of 61.8 per cent, and the photovoltaic solar project called ‘La Puna’ a capacity factor of 38.4 per cent. This report is available at:

[19] It is indicative of this consensus the fact that Law No. 27,191 (which introduced substantial amendments to the Federal Promotional Regime for the Use of Renewable Energy for Power Generation, previously approved by Law No. 26,190) was approved by the Argentine Congress with almost unanimity during the presidency of Cristina Fernández de Kircher. After the change of administration, the new government implemented Law No. 27,191 and launched public tender in July 2016, called the RenovAr Program, to award long-term PPAs with CAMMESA. These PPAs were not reviewed during the presidency of Alberto Fernandéz, notwithstanding there was an emergency declaration back in December 2019.

[20] A Spanish version of the proposed expansion plan is available at:

[22] Fitch Ratings, Unsustainable Argentine Electricity Subsidies Raises Cash Flow Risk (2021), available at:

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