Accelerating low-emission and resilient community energy in Argentina

Argentina’s energy sector is its highest emitting, with 186 MtCO2e annual emissions, or 51% of total country emissions. Within it, the energy industries subsector emits 59.5 MtCO2e annually, or 16% of national emissions. The energy sector’s absolute emissions show an upward trend over time and represent an increasing share of total emissions, due to an increasing demand for electricity driven by small and household consumers, in a context where the stressed national transmission network lacks the capacity to incorporate more renewables and dispatch available renewable power at peak demand times. The intertwined nature of the investments needed in renewable generation and its corresponding transmission infrastructure would require large amounts of capital and time to change this trend.

Grid-integrated low-emission community energy can help revert this trend by coupling distributed energy technologies with innovative business, management and asset property models, accelerating the decarbonization of the electricity sector at the local level. While the Argentinean national and provincial governments and other key national stakeholders have taken steps to address this challenge, the country faces four key barriers to transitioning to low-emission community energy. These are:
1. An absence of integrated and coherent national-provincial-local public policy and government actions for promoting low-emission community energy;
2. A lack of evidence in the country of the economic, social and environmental viability of low-emission community energy as a means to provide reliable electricity to consumers;
3. An insufficient knowledge of business models, market scale and catalysing financial instruments available to cooperatives and their suppliers to scale up and ensure sustainable community energy operations;
4. Insufficient knowledge and capacity to promote the development of low-emission community energy.

This project aims to address this global environmental challenge by promoting the decarbonization of the electric energy sector in Argentina through an innovative combination of public policies and technologies to accelerate the expansion of low-emission community energy. This objective will be achieved through four components that directly address the four key barriers:

1. Creating an enabling environment for low-emission electricity generation through community energy. The expected outcome from this component is that federal, provincial and local governments increasingly adopt a gender responsive strategy on low emission community energy aligned with the UNFCCC long-term strategy.
2. Demonstrating the economic, social and environmental feasibility of Low-Emission Community Energy. The expected outcome of this component is that national, provincial and local governments gradually implement low-emission community energy solutions.
3. Financing for a sustainable transformation to low emission electricity generation through low-emission community energy. The expected outcome of this component is that the government and public and private financiers develop and start implementing a national financing strategy, aligned with the National Climate Finance Strategy, for establishing, scaling up, incentivizing and supporting economic and financial operations of low-emission community energy.
4. Knowledge management and capacity building. The expected outcome from this component is that Provincial and local stakeholders demonstrate increased gender-responsive knowledge of low-emission community energy.
Through achievement of the four outcomes above, the project is expected to be transformative in supporting Argentina to implement its nationally determined contribution and UNFCCC long-term strategy and achieve a net-zero electricity sector by 2050. The project is expected to achieve greenhouse gas emissions mitigation over the project’s lifetime of 560,000 tonnes of CO2eq.