Vaca Muerta in the headlines again: government sweetens the pot

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On January 10, President Macri of Argentina announced new policy measures to revive investment in the Vaca Muerta shale deposits. In the picture above, the president is flanked by the leading figures in all matters Vaca Muerta. To the left, by the governor of Neuquén, Omar Gutiérrez, and to the right, by the oil workers' union regional representative, Guillermo Pereyra, and the Minister of Energy, Juan José Aranguren. The announcement was hailed as "historic" by its participants, but is mainly a commitment to continue subsidizing the domestic price of gas to producers, plus some measures to reduce labor costs. Here are ...

China emerges as dominant player in Argentina’s renewables

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China emerged as the big winner in Argentina's auctions this year. Also of note is the near total absence of U.S. companies. According to GLOBAL TRENDS IN RENEWABLE ENERGY INVESTMENT 2016  China was by far the largest investing country for renewables; excluding large hydro, China invested $102.9 billion in 2015, up 17% from the previous year, representing well over a third of the global total. The US was a distant second, with $44.1 billion, up 19%. While the numbers are much smaller in Argentina, it is undeniable that China has established a dominant presence in the budding renewable energy market. Chinese companies ...

Big year for renewables in Latin America – Argentina

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Source: IADB (2015) Lights On? Energy Needs in Latin America and the Caribbean to 2040. Electricity generation from renewable sources is nothing new to Latin America. For the last 50 years, Latin America has generated 45-50% of its electricity from hydro sources (though this number is strongly influenced by Brazil). In the last decade, many countries in the region have taken important steps to incorporate other renewable sources of electricity, such as wind and solar, and diversify their energy matrices. While the presence of these technologies is still relatively small, their growth has been exponential (as the charts above show) ...

Peace for Colombia: cause to celebrate.

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The signing of the peace accords between the Farc guerrilla forces and the government of Colombia is imminent, and it's significance cannot be overstated. It is the culmination of 4 years of negotiations and decades of violence, and will end the last and longest-lasting armed conflict in Latin America. The immediate cost of not signing the accords would be huge: according to data from the National Center for Historical Memory cited here, every year of conflict between 1958 and 2012 has resulted in over 4,000 Colombians dead and 87,000 displaced. The long-term effects, however, are harder to predict. Colombia's president, Juan Manuel ...

The Court hands Argentine government a corrective

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  On August 18, the Supreme Court of Argentina ruled in favor of consumers by annulling price increases for natural gas dictated by the government in March. The unanimous decision by the Court simply says that the government is under a constitutional obligation to consult consumers before setting new prices. The implications of this ruling, like most things in Argentina, are less straightforward.   The ruling The ruling is based on article 42 of the Constitution that says that consumers are entitled to receive adequate information on and participate in decisions pertaining to public services, rights that are further legislated by law 24076 that stipulates that ...

New era for energy SOEs

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Energy markets worldwide are undergoing constant regulatory revision driven by changes in technology: the growing presence of renewables and IT advances in network management. The old world of vertically integrated utilities with geographically fixed markets is rapidly vanishing. Deregulation in developing countries is also morphing into something new, and the old private-public dichotomy is being replaced by a marketplace where scaled-down state-owned enterprises (SOEs) compete side-by-side with private entrepreneurs. The presence of SOEs is important to the shape energy markets can take in developing countries and the long-term success of new investment and technologies. Insider's advantage The first thing that comes to ...