Generation, transmission: What to watch for in Argentina in 2025

Over recent months, hydrocarbons – particularly LNG and oil – have tended to dominate the limelight in Argentina, but 2025 could see electric power shifting into the beam. 

Following years of underinvestment, the grid continues to creak, with market observers awaiting announcements on formal government proposals to bolster and expand infrastructure.

Against this backdrop, Argentina is taking preemptive steps to help keep the lights on this summer, when high temperatures can increase demand and strain an already-stressed system. Among the pillars are initiatives to incentivize older thermoelectric plants to inject power, plans to import electricity from Brazil and moves to permit distributors to hire mobile generation plants. Indeed, distribution and generation shortfalls could spell blackouts in demand hub Buenos Aires province during January and February. 

Generation

A thermoelectric supply auction, TerCONF, was scrapped but a fresh attempt could get underway this quarter, according to the country’s biggest generator by installed capacity, Central Puerto.

Company CEO Fernando Bonnet said recently that “we are expecting a new tender for power, perhaps less MW than the TerCONF that we saw last year, but more focusing on specific points in [Buenos Aries metropolitan area] AMBA.”

Wholesale power market administrator Cammesa had awarded 3.3GW in contracts in TerCONF. 

The scrapping came amid expectations of an overhaul of the electric power sector by the Javier Milei administration, which favors a decentralized contract market. Remuneration regimes, to help spur competition, may also change.

In terms of renewables, this has been – and likely will continue to be – led by the Mater term market, where wind and solar generators sell output to offtakers such as manufacturers via corporate PPAs. 

The list of projects in the tiebreak round can be downloaded from the Documents box in the top-right corner of the page.

Transmission 

In terms of transmission, a lack of space on lines is hampering increased deployment of utility-scale wind and solar plants, particularly in zones with the best renewables resources. 

Illustrating this, just one of 31 projects presented in the latest transmission priority dispatch auction is exempt from having to participate in a tiebreak round.

This is 150MW wind farm Cerro Policía proposed by Australia’s Fortescue Future Industries for Río Negro province, where the company has previously announced plans to build a green hydrogen plant. Fortescue secured 88MW of transmission priority dispatch capacity under Mater Reference A, where Cammesa can award priority dispatch on congested transmission corridors to Mater projects, on the understanding that some associated output may be curtailed (8% probability of curtailment). 

BNamericas has emailed Fortescue for more information about the project, filed by a unit called Eólica Rionegrina.

Overall, wind and solar projects with installed capacity of 1.8GW have entered the tiebreak round. Almost 1GW of priority dispatch capacity is sought. The big question mark hangs over how much is eventually awarded.

On top of this, 345MW of capacity was awarded to Argentina's No. 1 clean energy generator Genneia under a mechanism where developers can apply for capacity associated with future new demand for clean power that, in turn, would impact assignable capacity on the grid. Of the total, 300MW corresponds to Mendoza province solar PV project Mendoza Sur. Transformer station work is involved. In addition, under the same mechanism, Solar Energy was awarded 75MW of capacity, with no specific project named.

Firms are due to submit associated tiebreak information on November 28 and capacity is due to be assigned December 2. 

Transmission demand in Argentina is seen coming from two main spheres: works to bolster the grid and boost capacity and works to carry clean energy to mines, many perched high in the Andes mountain range.

The government has marked transmission as a top priority. The challenge is to devise a framework which enables private investment and financing.

Industry stakeholders are awaiting a formal announcement on the government’s strategy.

Against this backdrop, transmission firm Transener proposed a US$9.80bn expansion plan, under which the outlay for the first projects would be shouldered by the demand side, local press reported recently.

In a related development, the International Bank for Reconstruction and Development has awarded Argentina a US$500mn loan, funds earmarked for building project management capacity in the sphere of power sector sustainability and for subsidy scheme management.