{"id":50055519,"date":"2022-06-28T18:47:02","date_gmt":"2022-06-28T17:47:02","guid":{"rendered":"https:\/\/stage.dialogochino.net\/?p=55519"},"modified":"2023-07-11T20:07:59","modified_gmt":"2023-07-11T19:07:59","slug":"55519-how-much-will-argentina-energy-transition-cost","status":"publish","type":"post","link":"https:\/\/dialogue.earth\/en\/energy\/55519-how-much-will-argentina-energy-transition-cost\/","title":{"rendered":"How much will Argentina\u2019s energy transition cost?"},"content":{"rendered":"<p>A simple reallocation of the state subsidies currently granted to fossil fuel projects\u00a0would be sufficient to finance Argentina\u2019s transition to renewables, and help the nation reach carbon neutrality by 2050, research by the Universidad Nacional del Centro (UNICEN) in Buenos Aires province has found.<\/p>\n<div class='block--pullout-stat block--pullout-stat--float cd-shortcode--factbox'>\n                <p class='block--pullout-stat__title'>US$500 billion<\/p>\n                <div class='block--pullout-stat__content'>\n                    <br \/>\nBased on averages from 2017\u20132021, Argentina could allocate almost US$500 billion in fossil fuel subsidies by 2050, according to projections from UNICEN<br \/>\n\n                <\/div>\n            <\/div>\n<p>To arrive at this conclusion, the <a href=\"https:\/\/periodistasporelplaneta.com\/content\/uploads\/2021\/10\/Analisis-comparativo-de-costos-para-la-transicion-energetica-en-la-Argentina.pdf\">study<\/a> projected almost US$500 billion in budget allocations for fossil fuel subsidies up to mid-century \u2013 an average of US$16.6 billion per year \u2013 to support oil and gas production and energy generation from thermal power plants. The figure is based on averages from 2017\u20132021. Researchers then analysed the comparative savings under three different energy finance scenarios in Argentina.<\/p>\n<p>The first is business-as-usual (BAU), and includes subsidies for confirmed new power plants, energy efficiency measures and energy infrastructure. The other two are zero-emissions alternatives: one based on electrification solely with renewables, the other includes biofuels. Both envisage the introduction of large amounts of renewable energy for electricity generation and <a href=\"http:\/\/stage.dialogochino.net\/en\/climate-energy\/brazil-sets-sights-green-hydrogen-market\/\">green hydrogen<\/a> production.<\/p>\n<p>Study authors Daniela Keesler, Nicol\u00e1s Diaz and Gabriel Blanco, did not, however, include new <a href=\"http:\/\/stage.dialogochino.net\/en\/climate-energy\/53021-argentina-nuclear-chief-energy-decarbonisation-solution\/\">nuclear power plants<\/a> or new hydroelectric dams as factors in their conclusions, due to the social and environmental concerns surrounding them.<\/p>\n<p>In sum, the money allocated to fossil fuel subsidies would cover between 58% and 100% of the costs of electricity transmission lines \u2013 one of the major costs of the transition \u2013 under a renewable energy-based electrification scenario. Therefore, the money to finance much of the transition is already there. The issue is redirecting it.<\/p>\n<h2>Renewables generate savings<\/h2>\n<p>Argentina currently has <a href=\"https:\/\/www.statista.com\/statistics\/665472\/renewable-energy-capacity-argentina\/#:~:text=Argentina's%20renewable%20energy%20capacity%20surpassed,by%20more%20than%2044%20percent.\">15 GW<\/a> of installed renewable energy capacity. In order to meet its international carbon neutrality <a href=\"https:\/\/unfccc.int\/sites\/default\/files\/NDC\/2022-05\/Actualizacio%CC%81n%20meta%20de%20emisiones%202030.pdf\">commitments under the Paris Agreement<\/a>, the country would have to increase this capacity exponentially, to around 240 GW, according to the UNICEN study.<\/p>\n<p>However, the costs of employing renewables to electrify the network are 21% lower than in the BAU scenario. In real terms, that would be a saving of US$508 billion.<\/p>\n<p>\u201cThe greatest savings are made by no longer consuming fossil fuels, both for final demand and for electricity generation,\u201d the report reads. \u201cThe biggest costs occur in areas such as infrastructure, due to the need for new power transmission lines or the installation of electric vehicle chargers. The large incorporation of electricity generation from renewable sources also generates higher costs, but by 2050 the [renewables-based] alternative scenario is the least costly.\u201d<\/p>\n<h2>Subsidies on the rise<\/h2>\n<p>During the previous decade (2010\u20132019), and as noted in the 2021 <a href=\"https:\/\/www.climate-transparency.org\/content\/uploads\/2021\/10\/CT2021-Argentina.pdf#page=6\">Climate Transparency Report<\/a>, fossil fuel subsidies in Argentina peaked in 2015 and then declined steadily, reaching a historic low of US$5.3 billion in 2019.<\/p>\n<figure id=\"attachment_55222\" aria-describedby=\"caption-attachment-55222\" style=\"width: 400px\" class=\"wp-caption alignright\"><a href=\"http:\/\/stage.dialogochino.net\/en\/uncategorised\/55191-argentina-energy-transition-halt-opinion\/\"><img loading=\"lazy\" decoding=\"async\" class=\"wp-image-55222\" src=\"https:\/\/dialogue.earth\/content\/uploads\/2022\/06\/Argentina-energy-YPF_Agustin-Marcarian_Alamy_2JB7MWH-scaled.jpg\" alt=\"a person illuminates a YPF fuel dispenser\" width=\"400\" height=\"222\" \/><\/a><figcaption id=\"caption-attachment-55222\" class=\"wp-caption-text\"><strong>Read more: <a href=\"http:\/\/stage.dialogochino.net\/en\/uncategorised\/55191-argentina-energy-transition-halt-opinion\/\">Opinion: Argentina\u2019s energy transition has come to a screeching halt<\/a><\/strong><\/figcaption><\/figure>\n<p>\u201cOver this period, most of the subsidies were directed to supporting the production and consumption of petroleum, followed by natural gas production and consumption, and the consumption of fossil-fuelled electricity,\u201d the report reads.<\/p>\n<p>Of Argentina\u2019s US$5 billion spent on fossil fuel subsidies in 2019, 76% went to oil, Climate Transparency reported. \u201cAlthough fewer dollars were spent than in previous years, the [2018] currency devaluation means that every year Argentina spends more pesos on fossil fuel subsidies,\u201d the authors noted.<\/p>\n<p>While the country introduced a 2018 carbon tax on liquid fuels, it did not tax natural gas, the most widely used fossil fuel in the country.<\/p>\n<p>According to Energy Policy Tracker data cited by Climate Transparency, Argentina allocated at least US$1.36 billion to fossil fuel energy in 2020 as part of its energy-related financing commitments and response to the impacts of the Covid-19 pandemic.<\/p>\n<p>\u201cThis includes the earmarking of 25% of the revenue from the extraordinary once-off tax imposed on the wealthiest in the context of the Covid-19 pandemic to support gas extraction and exploration by the state-owned enterprise Yacimientos Petrol\u00edferos Fiscales (YPF),\u201d the report said.<\/p>\n<p>Furthermore, the fiscal contribution to the gas sector in 2020 was estimated to be some US$1.06 billion.<\/p>\n<h2>Renewables for neutrality in Argentina<\/h2>\n<p>In terms of greenhouse gas (GHG) emissions, the alternative scenarios envisaged by Keesler, D\u00edaz and Blanco would see the country achieve carbon neutrality by 2050, reducing emissions by approximately 370 million tonnes of carbon dioxide. This amount is similar to Argentina\u2019s total current GHG emissions, the authors point out.<\/p>\n<p>Argentina is currently responsible for 0.8% of global emissions, ranking it the 21st highest emitting country, according to a new <a href=\"https:\/\/eciu.net\/analysis\/reports\/2022\/keeping-1-5-c-alive\">report<\/a> by climate thinktank E3G, the Energy &amp; Climate Intelligence Unit (ECIU) and the World Resources Institute (WRI).<\/p>\n<figure id=\"attachment_51893\" aria-describedby=\"caption-attachment-51893\" style=\"width: 400px\" class=\"wp-caption alignleft\"><a href=\"http:\/\/stage.dialogochino.net\/en\/trade-investment\/argentina-belt-and-road-china-membership-energy-transition\/\"><img loading=\"lazy\" decoding=\"async\" class=\"wp-image-51893\" src=\"https:\/\/dialogue.earth\/content\/uploads\/2022\/03\/Argentina-Belt-and-Road-energy-transition_Martin-Zabala_Alamay_2A0XJ67-scaled.jpg\" alt=\"people working in a solar plant\" width=\"400\" height=\"267\" \/><\/a><figcaption id=\"caption-attachment-51893\" class=\"wp-caption-text\"><strong>Read more: <a href=\"http:\/\/stage.dialogochino.net\/en\/trade-investment\/argentina-belt-and-road-china-membership-energy-transition\/\">Can Argentina\u2019s Belt and Road membership accelerate its energy transition?<\/a><\/strong><\/figcaption><\/figure>\n<p>Its climate commitments presented so far would see Argentina emit 349 megatonnes of carbon dioxide equivalent (MtCO2e) by 2030 \u2013 a figure described as \u201chighly insufficient\u201d by the study, entitled \u201cKeeping 1.5C alive\u201d. To be in line with a global average temperature increase of 1.5C this century, Argentina needs to emit no more than 213 MtCO2e by 2030, not including from land use, it found.<\/p>\n<p>\u201cContinued investment in expanding fossil fuel production \u2013 particularly unconventional oil and gas \u2013 is not compatible with a 1.5C world. Nor is it compatible with the commitment Argentina signed in Glasgow to reduce its methane emissions,\u201d said Gareth Redmond-King, one of the study\u2019s authors.<\/p>\n<p>Argentina generated 61% of its electricity from fossil fuels in 2020. Natural gas and oil were the main sources. The share of renewable energy in the electricity sector has been steadily increasing and represented 9% of the mix in 2020, with wind (7%) and solar (1%) the main sources.<\/p>\n<p>Currently, Argentina\u2019s per capita emissions are roughly the G20 average, according to Climate Transparency 2021. They decreased by almost 21% between 2013 and 2018.<\/p>\n<p>Climate Transparency 2021 identified three ways Argentina can reduce per capita emissions further. The first two are related and involve ditching fossil fuels \u2013 both exploration and energy generation \u2013 and incentivising the direct switch from natural gas to renewable energy sources.<\/p>\n<p>The third lies in nature-based solutions and \u201cThe protection of natural ecosystems, mainly forests and wetlands, [which] can offer excellent opportunities to mitigate and adapt to climate change.\u201d<\/p>\n<h2>What else is to be gained?<\/h2>\n<p>If instead of continuing to subsidise fossil fuels, government money is used to finance the energy transition, there would also be socio-economic benefits. One of these is green jobs.<\/p>\n<p>According to the alternative scenarios offered by UNICEN researchers, the transition to renewables would generate a higher number of jobs compared to the BAU scenario \u2013 some 120,000 more.<\/p>\n<blockquote><p>The COVID-19 pandemic has highlighted the need for renewables to meet social, economic and environmental needs<\/p><\/blockquote>\n<p>According to the International Renewable Energy Agency (IRENA), renewable energy technologies create jobs throughout the supply chain. Renewable energy accounted for an estimated 11.5 million jobs worldwide in 2019. In Latin America, these jobs were concentrated in the <a href=\"http:\/\/stage.dialogochino.net\/en\/climate-energy\/52305-palm-oil-amazon-sustainable-or-deforestation-risk\/\">biofuels<\/a> and <a href=\"http:\/\/stage.dialogochino.net\/en\/climate-energy\/51950-is-hydropower-making-a-comeback-in-the-amazon\/\">hydropower<\/a> sectors.<\/p>\n<p>The proliferation of solar photovoltaic (PV) panels is also helping to expand jobs in this energy sub-sector. Globally, solar PV accounted for 33% of the global renewable energy workforce in 2019.<\/p>\n<p>\u201cThe COVID-19 pandemic has highlighted the need for renewable energy to meet social, economic and environmental needs,\u201d reads IRENA\u2019s Renewable Energy and Jobs <a href=\"https:\/\/www.irena.org\/publications\/2020\/Sep\/Renewable-Energy-and-Jobs-Annual-Review-2020\">report<\/a>.<\/p>\n<p>The agency <a href=\"https:\/\/www.irena.org\/publications\/2020\/Apr\/Global-Renewables-Outlook-2020\">calls<\/a> for 42 million jobs worldwide by 2050 \u2013 four times its current level. Furthermore, energy efficiency measures would create 21 million jobs and \u201csystem flexibility\u201d \u2013 adjusting supply and demand to achieve an energy balance \u2013 would create an additional 15 million.<\/p>\n<p><em>This article was first <a href=\"https:\/\/periodistasporelplaneta.com\/blog\/cual-es-el-costo-de-la-transicion-energetica-en-argentina\/#:~:text=Seg%C3%BAn%20los%20datos%20del%20Energy,respuesta%20econ%C3%B3mica%20al%20COVID%2D19.\">published<\/a> as part of Comunidad Planeta, a project led by Periodistas por el Planeta (PxP) in Latin America, of which Di\u00e1logo Chino is a partner.<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Argentina could finance its transition by redirecting US$500 billion of government fossil fuel subsidies to renewables, new research finds<\/p>\n","protected":false},"author":3882,"featured_media":50055538,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[761,757],"tags":[17073,547,585,40027767],"hashtags":[],"country":[50000020],"class_list":["post-50055519","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-climate","category-energy","tag-energy-transition","tag-fossil-fuels","tag-renewables","tag-subsidies","country-argentina"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v26.0 (Yoast SEO v26.0) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>How much will Argentina\u2019s energy transition cost? 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