After a crippling energy crisis in 2004, a result of a natural gas shortage created by a demand for the dwindling, high-priced supply, Argentina has increased their effort to diversify energy sources, and create more sources of renewable energy. Through much research and development, as well as attracting investments, Argentina is starting to build up its cleantech sector, to not only be a cleantech powerhouse in Latin America, but quite possibly a world player when it comes to renewable energy and energy efficiency technologies.

1) Argentine Renewable Energy Chamber. The mission of the Argentine Renewable Energy Chamber is simple – “advance the interests of its members by creating sustainable industry growth and to play a pivotal role in creating a world-class, globally minded and respected industry. It is a nonprofit trade association representing the Argentina biofuels industry, as well as wind, hydro, and solar energies. Its goals include the promotion of foreign direct investment, international trade, and renewable energy technology transference to Argentina, increase the country’s economic development, and create a world-class industry for renewable energies. The work committees assist in information dissemination about the industry to others.

2) Increase in the Use of Wind Power. According to the Renewable Energy Chamber, and a report published by the National University of Comahue, Argentina’s Patagonia region could supply the country with more than 200 GW of wind power. With only two percent of it being used, an increase in wind power potential will decrease fossil fuel reliance. According to a push from legislative acts, the use of wind energy could jump to eight percent by 2016. Argentina has long been seen as an ideal spot for wind farms as approximately 70 percent of the land gets winds with an average annual speed of 50 meters above ground level. By introducing more wind, Argentina will further diversify its energy sources and stabilize energy prices.

3) Number One Global Exporter of Biodiesel. The greatest current success of Argentina in the field of renewable energies has been in the biofuel industry, namely biodiesel. As Argentina is the third largest grower of soy and the largest exporter of soy oil, it has created an abundance of biodiesel feedstock, and combined with export tax differentials to act as incentives; Argentina is the number one exporter throughout the globe of biodiesel. Argentina is also the fourth largest biodiesel producer, behind Germany, France and Brazil. Installed capacity has risen over 2.5 million tons annually.

4) Increase of Research and Development on Micro-Algae. The National Technological University in Argentina is currently researching micro-algae as a source of cost-effective renewable energy technology. Because of the expense associated with the conversion process of micro-algae to energy, the research and development project’s main focus has been two-fold – not only make optimum use of micro-algae, but also to do it as inexpensively as possible. The objective is to locate techniques that would be environmentally sustainable and economically viable. Researchers from different fields, including environmental engineering, aquaculture, and biotechnology have come together for this project.

5) Renewable Energy for Rural Markets Project. The Renewable Energy for Rural Markets Project is focused upon providing rural access to electricity needs. With more than 30,000 rural schools and households that are not located near the central grid, the project aims to provide these locations with renewable energy technologies, including solar and wind home systems, PV-diesel-batter village grids, hydro village grids, diesel village grid clusters, and other off-grid technologies.

6) GreenMomentum Inc. GreenMomentum Inc. is an international company with presence in the United States and Latin America. One of the head offices is locating in Argentina. The goal of GreenMomentum Inc. is to focus on pragmatic climate change solutions via social and technological innovation. According to the official website, “Our main interest is to promote the development and implementation of clean technology, as well as finding creative ways of financing new cleantech ventures and projects.” One of the biggest services they supply is a consulting service that offers market research, specialized industry reports, clean technology integration, and strategies for the development of green supply chains.

7) Solar Energy Provided to Rural Schools. A number of schools in Argentina are without electricity because of their far distance from the electrical grid. In 2008, the Corrientes Provincial Minister of Education invested $2 million into bringing solar power to these rural schools. This was connected with the larger program to bring electricity to Argentinean rural locations. Since the start of the project, more than 85 schools now have electricity through solar energy.

8 ) Argentina Energy Efficiency Project. Created in 2006 and ending in 2012, the Energy Efficiency Project in Argentina, implemented by the World Bank, seeks to increase the percentage of success of energy efficiency projects within the country. The goal is to find a way to get over the obstacle of lack of information on economic benefits of energy efficiency programs, as well as the lack of technical know-how and institutional incentives, financial constraints, and lack of efficient equipment. To aim of the project is the overall reduction of gas emissions by eliminating barriers that prevent energy efficiency and conservation. The project seeks to promote investments made into energy efficiency, provide technical assistance, and facilitate energy efficiency projects. The project is financed by the Global Environment Facility grant, Argentine Government, bilateral donors, energy companies, and other sources.

9) Saving Energy is the Key for Argentina. According to the University of Buenos Aires report coordinator, Carlos Tanides, “For Argentina, cutting energy waste is more cost-effective than constructing new, large thermoelectric or hydropower plants. For each peso invested into energy efficiency, the country could save at least 16 more pesos.” A report posted stated that Argentina could implement policies saving numerous GW/h of electricity, rather than building new large plants, which would cost more money. Taking this route, not only would Argentina save more than $6.5 billion for consumers by 2020, but it would also stabilize CO2 emissions back to 2005 level, reducing carbon emissions by 30 percent.

10) Green, LEED Certified Buildings in Buenos Aires. In 2009, Argentina had its first Green Building Conference. The conference brought numerous regional architects, policy-makers, industrial designers, and real estate professionals together to discuss and disseminate knowledge about creating more green buildings in Argentina. Because of the green building movement started in 2009, in 2010, an Argentinean hotel got the first LEED certification in the country. The hotel had numerous green features, including direct access to public transportation, 20 percent water savings in overall consumption, 14 percent more efficient use of energy, natural lighting, and low emissions materials for interiors.

Article by Shawn Lesser, president and founder of Atlanta-based Sustainable World Capital, which is focused on fund-raising for private equity cleantech/sustainable funds, as well as private cleantech companies and M&A. He is also a co- founder of the GCCA Global Cleantech Cluster Association, and can be reached at shawn.lesser@sworldcap.com

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“No doubts remain. Climate change is real and the build-up of greenhouse gases in our atmosphere is increasingly at an alarming rate.” With these words, Rafael Quiroga, General Manager of Accion RSE, initiated the seminar “Corporate Strategic Management of Climate Change and Greenhouse Gas (GHG) Emissions.” This is not another “green business” seminar from a European or North American city, it took place here — in Santiago, Chile.

The event brought together speakers from the Chilean private sector that gave concrete examples of their companies’ climate change and GHG management initiatives. First, it showed how Essbio, a water purification company, has been dealing with the ever-prescient and escalating challenges of decreasing water reserves due to climate change.  Second, it illustrated the emissions and energy reductions Xstrata Copper, a mining company, has committed to and the steps it has taken to minimize the release of contaminants in its industrial processes. Third, it explained what Natura cosmetics has done since 2007 to become a “carbon neutral” business by calculating all GHG emissions in the company’s supply chain, transportation, and production of its various cosmetics products, and purchasing the equivalent amount of CO2 tonnage in carbon credits on the international carbon markets.

Although Chile is officially considered an Annex B, “developing” country under the dual classification of the Kyoto Protocol, the smaller country of 16 million inhabitants has been no stranger to addressing the climate change issue in recent years. In addition to private companies’ activities noted above, Chile has also completed some 40 projects via the Kyoto Protocol’s CDM market since 2004. These 40 projects have ranged from landfill methane gas capture, to a nationwide energy efficiency CFL lightbulbs installation project, to agricultural methane capture, and to a wind energy project – yielding a total of US$300 million in traded carbon credits for Chilean enterprises.

Moreover, in early December 2008, President Bachelet, alongside her Environment Minister, unveiled Chile’s official “National Climate Change Action Plan” for 2008-2012. The plan includes activities for

1) studying impacts and vulnerabilities,
2) funding adaptation measures, and
3) strong support for mitigation endeavors, including the creation of a Center for Renewable Energy, establishing an increase of funds for a national energy efficiency program, further studies into harvesting biofuels, and increasing bicycle lanes for transport.

Although, historically, Chile has not contributed much to the total build-up of greenhouse gases in the atmosphere – actually 0.2% of total global GHG emissions for the last year tallied, 2004 – the country would like to see itself as a Latin American forerunner on confronting the issue.  President Bachelet’s new Action Plan not only concretely addresses the country’s increasing climate change concerns, but also demonstrates to the international community that Chile, too, is progressive and environmentally conscientious.

However, even with the formidable growth in the renewable energy sector, and a bit less so in CSR and ‘green business strategy,’ in Chile over the past 3-4 years, there is still an internal conflict and complexity as to how the “green” the country is truly progressing. As Mr. Quiroga pointed out at the seminar, Chile’s growth rate of GHG emissions in the past 10 years has been among the highest on the planet, alongside that of China and India. The main culprits for this have been

1) the booming energy intensive mining sector,
2) an increase in automobile use with economic growth, and,
3) an increased reliance on coal in recent years with disruptions in imported gas supplies from Argentina.

One recent study from the University of Chile actually found that Chile’s national GHG footprint is projected to jump 4.2 times its current amount by 2030.  This conclusion assumes the country continues on its current pace and manner of economic development, and with the increased reliance on new coal plants that are currently in different stages of construction.

So, yes, not only are the effects of climate change real in Chile but so too is a growing movement and public consciousness to reduce people’s and companies’ carbon footprints. In addition to Essbio, Xstrata, and Natura, there are other enterprises in Chile making efforts to reduce GHG emissions in their industrial processes or take action in other local environmental issues.  Yet, it is safe to say that such “climate change conscious” companies are still a small minority here in Chile.  And, even though President Bachelet and the Minister of Energy are making genuine, good-faith efforts to bring the latest solar and geothermal energy technology to Chile such as with partnerships with California and the US Department of Energy, the situation of increasing national GHG emissions reveals a deeper complexity we all need to address:

How can a middle-income economy, such as Chile, afford the latest in clean and renewable energy technology to reduce its climate change footprint, while at the same time, continuing to address more pressing needs of economic and social development?

In other words, a country such as Chile still needs to put its food on the table by mining the copper, whether imported gas or a cheaper “clean” energy solution is currently available; and, if they are not available, a bunch of coal will certainly do.

[photo credit: Cheo!]

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