Faced with the urgent challenge of climate change, Argentina needs to transform its energy matrix to use renewable sources. The energy transition (ET), focused on adopting clean energy, could open a door to breaking with an economic model dependent on fossil fuels and raw material exports. This transformation is not just an environmental issue but an opportunity to reduce structural vulnerability and build a more diversified and resilient economy. The question remains whether Argentina can make this shift without repeating cycles of dependency and economic volatility that have characterized its recent history. Sofía Croxatto reports.

Current status of the energy matrix and regulatory framework for renewables

Argentina’s energy matrix remains dominated by fossil fuels, which account for approximately 88% of its energy consumption​ (Lallana et al., 2021). Despite advancements in recent years, such as the 2016 RenovAr programme, the country still faces difficulties in developing a renewable energy sector capable of competing in a matrix structurally reliant on natural gas and oil​ (Barrera, Sabbatella & Serrani, 2022). In this context, the Renewable Energy Law (27.191) set an ambitious target: 20% of electricity should come from renewable sources by 2025 ​(IEA, 2023). This commitment is part of a broader strategy, which includes both national climate commitments and the transition toward a low-carbon economy under the Paris Agreement.

Argentina’s commitments regarding its Nationally Determined Contributions (NDC) serve as a roadmap for emissions reduction and advancing the energy transition. In the revised NDC, the country committed to reducing greenhouse gas emissions by 27.7% by 2030 compared to 2007 levels​ (Recalde, 2017). This pledge involves not only incorporating renewables into the matrix but also reducing fossil fuel subsidies and implementing energy efficiency policies to decrease conventional energy demand.

In terms of scenarios, Argentina has set long-term objectives for 2050, envisioning a progressive transformation of its energy matrix towards renewable sources. These scenarios, included in the Ministry of Energy’s ‘Energy Scenario 2030-2050’, propose that the country reaches at least 50% renewable energy generation by 2050, integrating sources like wind, solar, hydroelectric and biomass ​(IEA, 2023). This approach recognizes Argentina’s potential to develop clean energy, especially in areas with high wind and solar capacity. However, achieving these goals requires overcoming current barriers in infrastructure, financing and regulation.

As the 2025 deadline for the Renewable Energy Law target approaches, the need to update this legislation becomes increasingly evident. A revision of the law could adapt to new realities and challenges of the global energy transition while promoting policies that make renewables central to the country’s decarbonization strategy. This update represents a crucial opportunity to align energy policy with Argentina’s climate commitments, ensuring more solid progress towards an energy matrix less dependent on fossil fuels and more resilient to the economic and environmental impacts of climate change.

Opportunities and challenges for renewable energy

Argentina stands before a significant ‘green window of opportunity’ (GWO)​ (Lebdioui, 2024), a moment where its abundant renewable resources could serve as the basis for a new development model. The country’s geography offers unique potential for wind generation in Patagonia and solar power in the north, in addition to holding one of the world’s largest lithium reserves in the Lithium Triangle, essential for energy storage technologies​ (Fundar, 2021). By leveraging these resources, Argentina could not only reduce its dependence on fossil fuels but also foster the growth of an industrial economy based on renewable energy. This approach, as suggested by Lebdioui (2024), extends beyond clean energy production to include the creation of quality jobs, reduction of regional inequalities and the promotion of a competitive national industry in high-value sectors​.

To fully capture this potential, a green industrial policy must be built that not only incentivizes clean energy production but also facilitates the diversification of its productive matrix and the generation of jobs in strategic sectors. The expansion of renewables represents an opportunity to strengthen economic resilience and improve quality of life, particularly in marginalized communities facing high energy costs or limited access to reliable energy sources​ (IEA, 2020).

The shift to renewable energy in Argentina faces significant challenges, starting with the persistence of fossil fuel subsidies. These subsidies, intended to make energy more affordable in the short term, divert financial resources that could be directed toward the development of clean energy infrastructure ​(Barrera, Sabbatella & Serrani, 2022). While gas and oil remain necessary sources of income in the short term, the lack of a clear strategy to gradually reduce this dependence limits the possibilities for structural change toward a cleaner energy matrix.

Another crucial challenge is transmission and distribution infrastructure. Without adequate investment in transmission networks, Argentina’s renewable generation capacity cannot be fully integrated into the national electricity system. The lack of planning and a modernized infrastructure hinders the distribution of energy produced from renewable sources, and building a robust network is essential to maximize the potential of clean energy across the country ​(Barrera, Sabbatella & Serrani, 2022). These challenges require a long-term approach and significant investment in infrastructure, ensuring not only the viability of renewables but also their accessibility to all regions of the country ​(Roger y Arroyo, 2023).

For Argentina to sustainably advance towards a matrix based on renewable energy, it is essential to build a broad and sustained social consensus that enables the equitable distribution of the benefits of this change. The transition to renewables should not be understood solely as an environmental goal but as a means to improve quality of life and reduce energy inequality across the country. This process must be designed so that the costs do not disproportionately fall on the most vulnerable sectors, avoiding an increase in existing inequalities. The path to a clean energy matrix requires inclusive and committed policies capable of dispelling the assumed prohibitive cost of renewables and demonstrating that a fair energy policy is essential for economic and social development ​(Sabbatella, 2022).