renewables will shape argentina’s newenergy matrix
TRANSCRIPT
RenovAr Program
Round 1 First Public Call for Tenders for Renewable Energy Supply July 2016
Undersecretariat of Renewable Energy Ministry of Energy and Mining -‐ MINEM Argen=ne Republic
Renewables will shape Argen=na’s new energy matrix
ArgenAna has a clear mandate to reduce CO2 emissions and modernize its generaAon mix by using renewable energy sources…
1. CLEAR MANDATE
…leveraging on its wide availability of resources to develop world-‐class renewable energy assets…
2. AMPLIA DISPONIBILIDAD DE RECURSOS
…capturing key strategic benefits for the country based on recent market trends
4. STRATEGIC DRIVERS
…and offering an aMracAve legal framework and tax incenAves to investors
3. ATTRACTIVE FRAMEWORK
Renewables Development in Argentina
Argen=na’s Renewable Energy targets • Law 27.191 recently approved with high degree of support from all poliAcal parAes
⁻ Had >80% approval in both Senate and Lower Chamber of Congress
• Target of 20% of power demand in 2025 (from 8% in previous law, and 1.9% in 2015)
20% RE → 10 GW 2025 ENERGY MATRIX TARGET ADDITIONAL CAPACITY
% of Power Consumed
* Es%mated Addi%onal Capacity. Source: AITPA based on Ministry of Energy and Mines
Capacity, GW
1`w
RE, Target %
Renewable Energy Program 2016-‐2025 Regulatory Framework Elements
Ley 27.191 D.R. 531 Res. 71 y 72 RenovAr Round 1
Senate -‐> 4Q’14 Lower Chamber -‐> 4Q’15
Presiden=al Decree -‐> 1Q’16
Ministry of E&M-‐> 2Q’16
CAMMESA -‐> 2Q’16
RE Regulatory Framework
Mandatory Targets 8% @ 2017-‐18 20% @ 2025
Resource Diversifica=on Geographical and
Technological
Generous Fiscal Incen=ves
IPP and Local Manufacturing
FODER Support Trust Fund for
Guarantees and Financing
New RE Framework Act 27.191
RE Markets (Contrac=ng Mechanisms) 100%
of R
enew
able Ene
rgy Goa
ls
Private PPAs with Major Users*
Opt-‐Out
Self-‐GeneraAon
Opt-‐Out
* With Private Generators, Power Distributors or Commercializers
100% of the 300 kW-‐or-‐less demand and Major Users who do not opt-‐out. Price determined through Tenders
Major Users >300 kW who exercise their right to opt-‐out. Annual Goals subject to penal8es. Privately-‐nego8ated Price and T&C
PPAs Tenders
The Incentives are larger on the first stage as means of encouraging the Projects to
expedite COD
Act N° 27 191 – Fiscal Incen=ves
• Exemp=on of Import Du=es for all projects starAng construcAon prior to 12/31/2017 • Accelerated Fiscal Deprecia=on of applicable assets • Advance VAT Reimbursement paid on pre-‐COD purchases • Exemp=on of Minimum Presumed Income Tax • Exemp=on of Dividend Tax (subject to re-‐investment in infrastructure) • Extension of Income Tax Loss Carry Forwards to 10 years (standard 5) • Tax deduc=on of all financial expenses • Tax Credit on locally supplied CAPEX (transferable to third party)
MINEM will evaluate and approve the Access
of the Project to the Incentives Regime
To increase certainty regarding benefit allocation, technology global quotas and maximum amounts per MW have been established, reassuring benefit availability.
Call for Tenders
RenovAr – ROUND 1
ObjecAves & Benefits
* Hydro projects up to 50 MW are considered RE.
Expected Benefits
First Step towards the fulfillment of the 8% goal
1,8% => 4,5%
Emission Control 2 million ton CO2/year
(~ 900.000 cars)
New Jobs 5000 -‐ 8000
Annual Savings on Imported Fuels for Power GeneraAon
300 million US$
Direct Investment 1,5 / 1,8 Billion USD
RenovAr Round 1 1.000 MW
FODER Trust Fund Structure
Project Finance Account
• Treasury Funds • Public Offerings • ANSES (Pension Fund) • Mul=laterals / Climate
Funds
• Long Term Project Loans • Loan Guarantees • Interest Rate Subsidies • Equity Contribu=ons
Payment Guarantee Account
• Treasury Funds • Specific Charge
to Consumers • Sovereign Guarantees
• Payment Guarantee (for all tendered PPAs)
• Termina=on Payment
FODER
Guarantee Mechanism – 3 levels
FODER Guarantee
Sovereign Guarantee
World Bank Guarantee
Energy Payment
Termina=on payment 1
Termina=on payment 2
1
2
3
Tendered PPAs Energy Payment Guarantee
(*) To replenish FODER so that it always holds 12 months worth of elegible PPA payments as liquid reserve
Payments
Physical Flow
Guarantees
PPA
CAMMESA (Off-‐taker)
4. CAMMESA pays IPP on a monthly basis under PPA
2. CAMMESA bills End
Consumers on a monthly basis to through DistCos Electricity
End Consumers
1. IPP Injects Renewable Electricity into Na=onal Grid
3. Consumers pay on a monthly basis through DistCos
Renewable Energy Trust Fund (FODER) 6. FODER pays IPP under
Energy Payment Guarantee
IPP (Seller)
5. IPP Issues a claim to FODER for late or non-‐payment of Energy under PPA
8. Ministry of Energy & Mining increases
Guarantee Charge (*)
7. FODER seeks repayment from CAMMESA aoer having made a Energy Guarantee Payment on its behalf
1
Tendered PPAs TerminaAon Payment Guarantee
. (*) The FODER grants individuals and legal en%%es which have issued projects the irrevocable right to directly submit claims before the World Bank in certain cases and to receive payments from the World Bank.
MINEM / MINHYF Representa=ves of the Na=onal State
IPP (Seller)
Renewable Energy Trust Fund (FODER) (Trustee: BICE)
CAMMESA (Oraker)
4. IPP submits the claim for payment of the Project Sale Price (#) to the FODER
5. The FODER submits a claim for needed budget to the Ministry of Energy and Mining / Ministry of Finance and Treasury in exchange of the treasury bills, kept in guarantee.
7. The FODER does not pay to the IPP the Project Sales Price (#)
1. Cause for termina=on or sale of the project occurs
2. IPP submits the claim to CAMMESA
3. CAMMESA does not pay to the IPP
8. IPP submits the claim to the WB (*)
9. The WB pays the eligible amount to
the IPP (*)
11. Na=onal State pays to the WB the amount due
6. MINEM / MINHYF does not have the funds
10. IPP claims for the balance to the FODER Trustor
2 3
Preliminary Schedule
Transmission Grid and Interconnec=on Capacity
5
1
4
3
2
6
8
7 500 kV
330 kV
220 kV
150 kV
132 kV
*To be confirmed in definite version of bid documents.
CORRIDOR LIMITING CAPACITY (*)
MAIN INTERCONECTION NODES
(Tension in kV)
Max (MW)*
NOA
La Rioja (132) 120 La Rioja Sur (132) 100 Villa Quinteros (132) 100 ET Cobos (345) 400 El Bracho (220) 200
BUE-‐LITORAL-‐NEA Cañada de Gomez (132) 100 Rojas (132) 150 Puerto Mineral (132) 100
CENTRO Villa Mercedes -‐ Rio IV (132) 130 San Luis (132) 100
CUYO
Cruz de Piedra (132) 100 Jachal -‐ Punta de Rieles (132) 80 El Sosneado (132) 60 Cañada Honda (132) 100
COMAHUE 600 MW
ET Chocon (500) 300
Alicurá (132) 30
Puelches (132) 30
Bahia Blanca (132) 300
PATAGONIA 400 MW
Santa Cruz Norte (132) 130 Rio Santa Cruz (132) 50 Puerto Madryn (132) 50 Futaleufú – Madryn (330) 180
1
3
2
7
6
5
4
8
Bidder Qualifica=on Criteria
• Bidders can be individuals or consorAa who are either shareholders or have irrevocable rights over the Project´s SPV.
• Bidders must provide documents availing (individually or collecAvely) for a minimum of 250.000 US$ Equity per MW of Offered Power Capacity (OPC)
• Bidders must provide sufficient and acceptable guarantees:
– Bid Bond: 35.000 US$ per MW of OPC
– Performance Bond: 250.000 US$ per MW of OPC
• Bidders must register and purchase the Request for Proposals (RfP) from CAMMESA (cost 150.000 AR$). The cost is 100% reimbursable in the event of “B” Envelope (Economic Bid) disqualificaAon.
Project Qualifica=on Criteria
• Projects must be structured as independent SPVs • As of the date of Bid Submission they must prove that they have:
– Approved Environmental Impact Study – Real, verifiable rights over the Project site – Acceptable and cerAfied resource assessment (A minimum of 12 months worth of
resource measurement for Wind projects) – Energy producAon esAmates (In accordance to the bidden generaAon equipment) – Having had iniAated the request for permission to operate as wholesale power
market agent (“Agente MEM”) at MINEM – StaAc and Dynamic electrical studies (PT1 -‐ technical interconnecAon studies)
• All legal & technical project documents, as well as the appropriate documentaAon requesAng the applicable fiscal benefits must be submiMed in the “A” Envelope (Legal & Technical).
Renewable Power Purchase Agreement (RPPA) Annual Price Adjustment and IncenAve Factor
• The power prices will be adjusted on an annual basis (as pre-‐set in annex to PPA) • In addiAon, an “IncenAve Factor” will be applied on a calendar year basis as a way to
incenAvize early COD.
Thank you
Undersecretariat of Renewable Energy Ministry of Energy and Mining
Paseo Colón 171 Piso 8 Oficina 812 +54.11.4349-‐8033/8186 [email protected] Documents available at: www.cammesa.com.ar and www.minem.gob.ar