Argentina wants to significantly expand wind power

The bleak sea breeze wreaked havoc in Argentina's cold and dry Patagonia region, which provided good conditions for the development of wind power. Recently, Argentine officials said that due to the recovery of the economy in the next few years, the expected increase in energy consumption, the number of wind turbines in the country's wind farms in the Patagonia region will greatly increase.

According to Argentine officials, the 43 turbines provided by Vestas Denmark to wind farms in Patagonia this year will generate more than 320 million kilowatt-hours of electricity, which will reduce Argentina’s carbon dioxide emissions by 100,000 tons per year.

Argentina has abundant wind resources. According to the latest data released by the Argentine Renewable Energy Chamber of Commerce, nearly 70% of Argentina’s territories have average annual wind speeds above 6 m/s. Argentina has experienced natural gas shortage for eight consecutive years, but the country’s wind development efforts are still limited. As of the end of last year, the country’s installed wind power capacity just exceeded 30 MW. Wind power only accounts for 0.21% of the country's energy structure. And many wind farms were built in the mid-1990s or the first years of this century.

Argentina’s wind power has not received due development and is inextricably linked with the government’s strong involvement in the energy market. Since the economic collapse in 2001, the Argentine government has been protecting consumers from high energy prices. Government financial subsidies and strict price controls allow Argentine citizens to enjoy affordable electricity prices. However, this kind of government regulation ignores the marginal cost of the generator. It is very difficult for operators to recover the costs of their investments and operations, and there is little incentive to invest in the energy sector. The government's generous subsidy to the power sector has also brought a heavy financial burden on the government. In order to ensure the continuation of the subsidy policy, the Argentine government had to announce in November 2008 that it would cut its subsidies to the power sector, drastically increase fiscal revenues, and raise the price of electricity.

“The situation has started to change, subsidies have become too expensive, and the government has limited capacity. This is good news for wind energy development,” said Mauro Suares, chairman of the Wind Energy Committee of the Argentina New Energy Chamber of Commerce. Suarez said: “From the medium-term prospects, Argentina’s wind power outlook is positive. The entire power industry will become more and more market-oriented, and more funds will flow to the power industry. Wind power will benefit from this. We hope that in the next five years, The installed capacity of wind power in Argentina has reached 2,000 MW."

The V901.8 MW wind turbine that Vestas sold to Argentina will be installed at two wind farms in Chubut province in southern Argentina. A official said that it is hoped that the two wind farms will be completed in 2012. Vestas will be responsible for the transportation, installation, commissioning and maintenance of these wind turbines. Vestas official website said that transportation will begin in the first half of next year, and installation and commissioning will be completed in January 2012. Although Alfonso did not disclose the specific financial details of the purchase of the turbine, the wind turbine was received by Emgasud, Argentina’s largest investor in renewable energy projects. According to Ivanisevich, President of Emgasud, the company will commit itself to the diversification of energy supply and environmental protection in Argentina. He also stated that the company will continue to invest in renewable energy projects in Argentina and is confident in the technology, products and solutions provided by Vestas.

Vestas hopes to use this project as an opportunity to open up its market in Latin America. Juan Araluce, president of Vestas Mediterranean, said that this new project in Argentina could be a start for Vestas to develop wind power with Latin American countries. Earlier this month, Argentina also announced the country's nuclear power expansion plan, which shows its efforts to explore the road to energy diversification.