Lucas Estrada is confident Argentina’s first solar panel factory will start producing parts this year.
He is president of Energía Provincial Sociedad del Estado (EPSE), the state-owned company that will run the factory. EPSE is also in charge of promoting and managing the production and distribution of energy in San Juan, a province close to the Andes in western-central Argentina.
In San Juan, the economy is centred around mining, especially of gold and silver, although there are now plans to diversify into minerals crucial to the clean-energy transition, such as copper. Though the province ranks 13th in terms of its population, with just over 4,800 jobs associated with mining in 2024, it often ranked second in mining exports between 2006 and 2023.
Dialogue Earth spoke with several senior figures both from ESPE and the mining sector, who see the renewable energy generation and clean-tech manufacturing as a strong complement for the mining sector in the province. “We have some of the best [solar] radiation in the world. We can become a node of the renewable industry here,” says Estrada.
Because of the sunshine and political decisions, just over 66% of installed capacity for San Juan’s electricity grid is solar, according to data from Cammesa, which manages Argentina’s wholesale electricity market, compiled by Dialogue Earth. The rest is divided between large and, to a lesser extent, small hydro projects, and a single thermal power plant.
Since 2017, San Juan has moved from being an importer of electricity to a net exporter. Estrada notes that there is a surplus of electricity generated by the end of the day. However, the province is now looking to increase supply even more – mainly for mining, which requires large amounts of energy. This is laid out in the San Juan Solar Project, the government’s comprehensive plan launched in 2007 to capitalise on the area’s ample sunlight.
He lists the milestones that have since been achieved, including completion of the first wind farm, the solar and wind maps of the province, and the upcoming solar panel factory. “We will be transforming San Juan’s economy to invest mining resources in renewable energy,” Estrada says.
The first grid-connected solar photovoltaic (PV) park in South America was built in the province in 2011. Currently, there are 21 solar parks in operation and five under construction. The majority of them have been built in partnership with private companies: the province rents the land, and the companies build and manage the operation. The original intention with the solar panel factory was for private companies to supply part of the infrastructure and thus lower the costs of expanding San Juan’s existing grid. But Estrada says the province now also intends to export certain components made there and build an import-export relationship with strategic players, in particular China, Europe and the United States.
The factory
The new factory, located in the province’s namesake capital city, will first produce solar panels from imported materials, and then cells, silicon ingots and wafers. Ingots are the raw materials, cut and processed to form wafers, that are then manufactured into cells. Each cell is interconnected to form a panel, which transforms sunlight into electricity.
San Juan plans to produce 800,000 panels per year, with a total capacity of 450 megawatts (MW). “In fact, our plan is to double production in the short term, to become a ‘gigafactory’,” says Estrada. “The building is designed so that it will be possible to double the machinery and reach 1 gigawatt (GW) in the near future.”
The factory is divided into two: the solar panel facility and the ingot, wafer and cell facility. On a tour in April, Dialogue Earth observed that progress on the panel facility was almost complete. “We are testing the quality of one last machine and it could start producing soon,” says Estrada, adding that this was tentatively in September. EPSE had previously announced it would be scheduled for April. The second facility, for producing cells, is expected to follow later on.
Martin Dapelo, a member of the board of directors of the Argentine Chamber of Renewable Energies (Cader), notes that solar cell production would be new to the region: “There are laminators in Brazil, but I don’t know of any cell factories in Latin America,” he says. For now, the solar cells needed to assemble the panels will be imported mainly from China. Other related components such as batteries and current converters will also be imported from China.
EPSE’s solar project – and the company itself – are inextricable from China’s role in the global renewables market, and particularly the solar PV industry. San Juan, like the rest of Argentina and the region, imports all PV infrastructure components almost exclusively from China. In fact, 99% of solar panels imported to Latin America originated there in 2023, according to The Economist.
Power China is the main supplier, although San Juan also has relationships with Huawei for power converters, Risen Energy for storage, and ConfirmWare for factory machinery, Estrada notes. He adds that despite importing most of the materials from China, the plant could still lower the cost of the final product by 10-15% compared to importing from the country.
It will be an almost entirely automated factory and require around 110 workers, Estrada says. Most of the staff will be “highly skilled in operation, maintenance and robot programming”, he adds, claiming that it will also create many more indirect jobs.
The state-owned company has partnered with H2 Gemini, a Swiss company that builds machines to produce solar panels. “Both [H2 Gemini] and other external consultants [from the United States and Australia] have visited us, and we have travelled to train ourselves,” says Estrada, who adds that employees have also travelled to China for training and that the relationship with the country is strong.
Estrada says that, within a global framework of trade tensions, San Juan is navigating carefully between its Chinese and US partners. The factory’s components and equipment will be sourced largely from Chinese materials, while he hopes to sign agreements with the US to import silicon for the ingots and wafers. “Eventually, we also intend to export to the US,” Estrada says. Despite acknowledging that they could not compete with Chinese prices at the moment, he says the tariff war positions San Juan as a strategic player: “They need a lot of factories outside of China and there really aren’t many high-quality panel factories.”
This year, both Estrada and the provincial governor, Marcelo Orrego, have met with business and government representatives of the European Union, the US and China. In May, Orrego met the ambassador of the European Union in Argentina, Amador Sánchez Rico, and diplomatic representatives from 22 other countries in the bloc, to present San Juan as a trade hub for key sectors, emphasising electromobility and the energy transition. He did the same recently with diplomats from the Trump administration, and was the only Argentinian governor to attend his inauguration in January.
Juliana González is a specialist at the Latin American Faculty of Social Sciences (Flacso), where she analyses China and its economic and financial ties with Latin American countries. She sees greater value in forging ties with China. “The United States is on its way out of the lithium game in Argentina. I don’t see many US companies interested in renewables; the US puts a lot of pressure on them and on the South American countries, but they [US companies] don’t offer anything,” she says. “Power China, on the other hand, has been going around the provinces a lot and offering contracts. It also offers [competitive] prices, financing and know-how.”
The link with China
For a little over a decade now, China has been one of the main factors in the sharp fall in solar panel prices worldwide. At the turn of the century, panels were fetching USD 6.41 per watt, but by 2023 that was down to USD 0.31. As of 2022, China accounted for over 80% of the production of all components required for solar panel production, according to the International Energy Agency.
From 2016 to 2019, Argentina entered the PV market through a series of tenders during president Mauricio Macri’s administration. “The tenders were won by a number of Spanish companies in particular, but also by Chinese companies. It was China’s gateway to the renewable energy sector,” González explains.
In January, San Juan province, through EPSE, signed a memorandum of understanding with Shanghai Electric, a subsidiary of the Power China group. This was to generate a loan with favourable terms to finance solar, wind and storage systems, González explains, particularly for the development of a wind farm on Tocota, a site located a few kilometres from the city of San Juan.
For González, the province’s interest in China is a natural outcome of its expansion into renewables. “Although I see [the] acceleration of it [as seeking] alternative markets to the US, with the tariff war with Trump”, she says.
The interest in strategic markets such as energy is also being seen in other Latin American countries, such as Brazil, Peru and Chile, says González. “There is a question of a technological race and access to resources that is also accelerating in the region.”
She notes the significant Chinese influence in Argentina’s development of its renewable energy industry. In particular, she describes a trend especially prevalent in the country’s wind projects: engineering, procurement and construction (EPC) contracts, an agreement where companies such as Power China “basically take charge of the entire construction and installation process”, she explains.
Such arrangements present certain disadvantages for Argentina. “There is no collaboration with Argentine companies, no transfer of technology, no transfer of know-how. The company comes, sets up shop, and uses its own materials,” González notes. However, she excludes the EPSE factory from this category as “there is a learning process and [transfer of] know-how” in the project. Additionally, as a completely state-owned park, “the logic of negotiation is different from cases where the EPC contract is implemented,” she says.
But though its role in EPSE may be beneficial for the province, González highlights that China’s promotion of the renewable energy sector in the region and the wider country does not mean it is purely in support of the energy transition. She cites the Chinese state-owned company PetroChina’s plans to set up operations and explore business opportunities in the oil- and gas-rich region of Vaca Muerta by the end of this year as an example.
