Jan. 19, 2017
Thanks to Argentina’s decision to raise the price of bioethanol to $13.2, private capital is now willing to invest in the related infrastructure.
The first RenovAR contracts were signed recently.
RenovAR, the Renewable Energy Plan, was launched by the Argentinean Ministry of Energy and Mining to extend the use of sources of renewable energy for the generation of electric power. This is the main aim of the Legal Regulations on National Promotion.
It implies a wider diversification of the national energy mix, the extension of the installed capacity, the reduction of fossil fuel consumption and greenhouse gas emissions, and the contribution to mitigate climate change, among others.
The domestic ethanol market will now have room to grow while the demand will increase as a result of the official decision to increase the price of this biofuel to $13.2.
In fact, the new pricing may trigger private investment in the production of corn and sugar cane.
According to Argentine Maize Association authorities, the hike in the price of this biofuel is in line with the objectives of the Value Added Secretariat and the Ministry of Energy.
Argentina will try to effect higher cuts (in naphthas) in ethanol to improve the functioning of its fleet and shore up its fuel market.
As per official figures, bioethanol production now exceeds one million cubic meters, with maize contributing 520,000 cubic meters and sugarcane another 490,000 cubic meters.
Demand to reset the price of ethanol was being pressed for a long time, especially by the maize suppliers, and finally, the Ministry of Energy conceded it.
Also, the first contracts were signed for renewable energy parks.
The Ministry of Energy and Mining recently announced that the first seven contracts were signed for projects to produce renewable energy, as awarded in Round 1 of the RenovAr Program.
The signed contracts aim to produce 314.95 megawatts of energy, and refer to five wind farms in Buenos Aires, Chubut and La Rioja; one for biomass in Corrientes; and another for biogas in Córdoba.
The projects will be developed by Biomass Crop, Papelera Mediterránea, Genneia, PAE, Central Puerto and Parque Arauco.
The RenovAr Program came to a close on November 25, 2016 with a total of 59 projects awarded. Private investment worth US$ 4 billion will flow in, and 20,000 new jobs will be created.
The energy thus generated, coupled with the energy generated by renewable projects already running commercially and other projects underway, will collectively account for 9 percent of the national electricity matrix by the end of 2019.