The document outlines Argentina's first public call for tenders under the Renovar program aimed at increasing the renewable energy share in the energy matrix to 20% by 2025, as mandated by Law 27.191. It emphasizes various incentives for investors, including tax exemptions and opportunities for project financing, while detailing the regulatory framework and requirements for bidders. The initiative is projected to significantly reduce CO2 emissions and create thousands of jobs, while also providing extensive market guarantees for renewable energy projects.

1. 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

2. 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

3. 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
RE,
Target
%

4. 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

5. 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

6. RE
Markets
(Contrac=ng
Mechanisms)
100%
of
Renewable
Energy
Goals
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

7. 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.

8. Call
for
Tenders
RenovAr
–
ROUND
1

9. 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

10. 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

11. Guarantee
Mechanism
–
3
levels
FODER
Guarantee
Sovereign
Guarantee
World
Bank
Guarantee
Energy
Payment
Termina=on
payment
1
Termina=on
payment
2
1
2
3

12. 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

13. 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

14. Preliminary
Schedule

15. 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

16. 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.

17. 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).

18. 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.

19. Thank
you
Undersecretariat
of
Renewable
Energy
Ministry
of
Energy
and
Mining
Paseo
Colón
171
Piso
8
Oficina
812
+54.11.4349-­‐8033/8186
privadarenovables@minem.gob.ar
Documents
available
at:
www.cammesa.com.ar
and
www.minem.gob.ar