Economic and energy diversification in Neuquén

We have met the Engineer José Ricardo Brillo, president of ADI Neuquén who explained to us the interesting policy about energy diversity and the renewable ventures and projects of the province.

The Development and Investments Promotion Agency of Neuquén (ADI Neuquén) was created by the former governor, the engineer Pedro Salvatori in 2008. It depends on the Ministry of Economy of the EP of the province of Neuquén, based on an organ that could accompany the public policies seeking and promoting investments and financing.
It was not born connected to Vaca Muerta, but to everything that could promote the economic diversification and territorial balance in the province.
The 15 % of the Gross Geographic Product has been reached, that is not the oil and gas, but the renewable energies, tourist developments, real-estate developments, irrigation areas, project of treatment of urban solid waste. They are not related but complement Vaca Muerta and the oil and gas development. This is the agency mission.
A great prospective task is done from the point of view of these projects working on their feasibility. The wind is measured in different places as well as the solar intensity, rivers are analyzed to know where to build micro hydroelectric plants, geothermal energy plants as well as biomass projects. In this way, the great project of renewable energy of Neuquén is born; being the governor Omar Gutiérrez one of its main drivers. He basically thinks that although Neuquén is a region that produces fossil fuel energy, it is necessary to bet heavily on green and clean energy. That is, using green and clean energy for our own consumption, and exporting to generate income and currency with oil and gas, which implies works and infrastructure and development projects.
It means that if oil incomes are obtained to do 15 thousand hectares of forestry or irrigation, diversification is taking place.
Two years ago, the first thing to do was to have the law of adhesion passed and exempt the activity from the payment of provincial taxes. The concept was “wind turbines or taxes“, and of course, the former option was the one chosen.
This bill brought about a scenario of competitive projects and was unanimously approved in the legislature of Neuquén and the activity of development of renewable energy was exempted from IIBB, real estate and stamp taxes.
From this measure on, the projects are promoted (a plan is copied with the projects). There are
wind projects of 100 MW each one, which are feasible with the environmental qualification, land authorization and with electrical interconnection, already defined.
There are three wind projects over Limay River in an agricultural area and three projects in Vaca Muerta, having, then, the possibility of supplying the fracking with wind energy.
This would cause great impact and obviously would provide a good image for what is called the environment preservation.
There are also two wind projects in the centre of the province, in Zapala, where a free zone will be activated this year which will be significant from the point of view of equipment, of the fractionation industries and others that will be able to be installed in the province.
There are also small hydroelectric plants in the north Colo Mechi Co, Los guiones, Butalón Norte and Nahueve. This last one is special because at the moment it is being awarded for its construction.
This northern area of Neuquén is a region to be developed. It covers 30 thousand km2 with 30 thousand inhabitants, that is, one inhabitant per km2, but it is a wonderful energy zone.
There are two geothermal projects in Copahue and Domuyo. The last one is a kind of Vaca Muerta of the geothermal. There is also a small project of photovoltaic solar energy of 3MW.
There is an excellent relation with Chile. Neuquén’s competitive factor lies on 700 km of the border with Chile with 7 border crossing points and the 8th, 9th and 10th regions that are the most important of Chile on the other side. That is why we export oil, gas and we also want to export power energy. From there, the north, the export comes, which is a project in development called Hidro Geothermal Pole, as it involves the small hydroelectric plants and the geothermal ones. As for the renewables, the large plants, such as El Chocón are not considered, just the plants of less than 50 megawatts.
The idea of this great programme in northern Neuquén is due to the fact that people from Neuquén are far from Buenos Aires, 1600 km away and do not have electric power lines, that is, the PPP projects for the energy lines have made no progress so far.
People in Neuquén say: “we have Chile next to us” and therefore we can sell electric energy to it as we also sell oil and gas to it.
Chile has a conversion programme of its energy matrix because it wants to remove coal plants and liquid fuels and besides, it has problems with the hydroelectric plants due to problems with the communities. Therefore, there it is Neuquén to supply the energy of the renewable and hydroelectric projects. About 2,000 MW could be exported. There have been talks with Chile’s authorities about it and it could be done near Chillan, 200 km away from our key hub.
As for the financing of the projects “Aeolic Park Neuquén Winds 1”, 29 wind turbines are already being built and they will come into operation in March as it takes a year to be constructed.
It has been transferred to AES Corporation. It is an American company that has been granted the concession of Alicurá, that is being constructed and financed with OPIC´s funds. It is the financial institution of the United States which, about a month ago, approved a 122 millions loan for this project in Neuquén. On the other hand, Vista was granted a 350 millions loan for Vaca Muerta, for this aeolic project.
Work is being done to solve the transport logistics of large-scale equipment. The wind turbines and the blades are arriving at Eastern San Antonio or Bahía Blanca ports and, from there they are transported to Neuquén.
Apart from the agency projects, though taken as ours, it is worthwhile mentioning Los Meandros, next to Plaza Huincul. The Chinese company Envision is developing a project of 125 MW and we are working closely with them in the logistics and financing closure.
Nahueve Micro Central, which is a very sustainable project of 4.5 MW, is going to have a pipeline and a machine room where the water will be transported with a fish trap and has been designed under the best conditions so that it does not affect the natural life. This has required an investment that was achieved by a loan in Arab Emirates of 21.5 million dollars with a 2 % of annual interest, a 5-year grace, 15 years of amortization and it is about to being awarded.
There will be a 3-year delay as the wind parks have 1-year delay and the solar parks a 6-month delay.
The engineer José Brillo stated that he was convinced that, as regards renewable energies, there was a state policy. During the government of Cristina Fernández the laws 8 % and 20 % in 2025 were passed. And during the government of Mauricio Macri, professional teams were made up and this policy was regulated and carried out and we hope the new government will do the same. It is estimated that the 12 % will be reached this year.
A bill of electromobility has been submitted; its aim is having electric cars and buses for public transport, lorries for transport and as for the air field, the possibility of electric traction in airplanes is being discussed.
The goal is to generate a circuit of electric cars between Argentina and Chile, in one of the most beautiful areas of the world which is the 7- lake road from Villa la Angostura until San Martín and Junín de los Andes and, on the Chilean side, from Pucón Villa Rica and Lican Ray up to Puerto Mont, Puerto Varas.
Chargers are being armed with Chile; 3 on this side and 3 on the Chilean side and they will have an autonomy of 200/230 km.
Moreover, beyond the electromobility issue, an agreement is being signed with Neuquén justice so that the big judicial buildings that hold the courts of justice in Neuquén Cutral Co, could be supplied with renewable energy. In this way, costs can be reduced because it is well known that renewable energy, mainly wind and photovoltaic is much cheaper. The same applies to the sectors of education, schools and health at hospitals. As well as to the production areas, irrigation consortiums and wineries. (There are 4,000 hectares of vineyards and best quality wines).
There is one project of the investments agency we have been working on for almost 10 years, that deals with the treatment of the urban solid waiste. It is been developed in 14 y 15 local towns located in the confluence of Rio Negro y Neuquén. one of the biggest promotional sectors of the country, from Allen to Añelo, with a population of 800 thousand inhabitants.
This project is supported by the National government through the Environment Secretary.

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