This is an automated translation of the original column published in Spanish.

By Damian Dotto, lead director in Renewable Energy at KPMG Argentina

Buenos Aires, May 15, 2026 / KPMG. (Written by Damian Dotto, lead director of Renewable Energy at KPMG Argentina). It is well known that these are times of uncertainty and high volatility around the world, forcing plans and strategies to be rescheduled. When Law 27.191 for the Promotion of Renewable Energy expired last December, a war in the Middle East and the resulting doubling of crude oil prices were far from being anticipated. As a result, attention has once again turned to renewable energy as an alternative source. When the law to boost the sector was passed in 2015, it undoubtedly marked a turning point for the development of electricity generation from renewable sources in Argentina. Its term, which ended on December 31, 2025, marks an inflection point: with its expiration, new projects will no longer be supported by the tax, financial and regulatory incentives established by the Law, which were key to attracting investment: according to the “RenovAr programme Case Study” report published last December by RELP (a non-profit organization whose objective is to promote the deployment of renewable energy), in the 2015-2025 period there were US$11.500 million in accumulated direct investment through 193 operational projects and 44 under construction). The regulation also set ambitious targets, such as achieving a 20% share of renewable energy in national electricity consumption by December 31, 2025, reaching 18.9% according to CAMMESA data), and it created a framework of predictability and legal certainty that allowed the inflow of capital, the development of large-scale wind and solar projects, and the consolidation of a local value chain. However, the end of its term of validity now entails a substantial change in the rules of the game.

One of the main attractions of the Law was its system of tax benefits, designed to improve the profitability of capital-intensive and long-term cash flow projects. Among the most relevant incentives were:

• Accelerated depreciation for income tax purposes, which allowed the investment to be recovered in significantly shorter periods than under the general regime;
• The early refund of value-added tax associated with the acquisition of capital goods and infrastructure works;
• Exemption from the presumed minimum income tax (while it was in force);
• Exemptions or reductions in import duties for equipment not produced locally, among others.
• Transferable tax certificates, applicable to the payment of national taxes. 

Another fundamental aspect of the Law was the creation of the Fund for the Development of Renewable Energies (FODER), this fund being conceived as a public trust aimed at: 

• Granting loans and capital contributions to renewable energy projects.
• Providing guarantees, sureties, and other financial instruments to back electric power supply contracts.
• Reducing credit risk and facilitating access to financing, especially international financing. 

This fund played a strategic role by backing renewable electricity supply contracts (PPAs) signed under the RenovAr Program, acting as a payment guarantee and increasing the confidence of investors and financial institutions. In practice, FODER was a mechanism that helped turn tax incentives into concrete, operating projects. With the expiration of the Law, these benefits were no longer available for new projects, directly affecting financial flows and the economic attractiveness of future renewable investments. And it was regulatory predictability that established clear rules and benefits with a defined time horizon, providing certainty to developers, investors, and lenders, a critical factor in projects with capital-intensive investment and timeframes of around 20 years. 

During its term it allowed: 

• Diversifying the energy matrix
• Reducing greenhouse gas emissions
• Expanding installed renewable capacity by approximately 7,200 MW
• Creating the Renewable Energy Term Market (MATER).
• Positioning Argentina as a key player in wind and solar energy in the region. 

As evidence of the success of the Law, it is enough to mention that in 2015 the total energy generated from renewable sources contributed only 2,510 GWh to the system (1.9% of MEM demand), while by the end of 2025 the total energy from renewable sources contributed to the system was 26,259 GWh (18.9% of MEM demand). Of this volume of energy from last year, 50% was supplied by projects related to the Renovar rounds, while 40% corresponds to MATER projects. 

And when we break down the generation data by technology for the energy generated, we can see that in 2015, 64% came from hydro projects (<= 50Mw), while the share of wind and solar barely reached 23.6% and 0.5% respectively. Now, when we analyze this same information for 2025, 70% of the energy generated comes from wind projects and 19.1% from solar projects, to the detriment of hydro projects, which end up contributing only 5.1% and have not grown in their installed capacity since 2015.

Regarding the growth ratios of the different technologies since the Law was enacted, biomass increased fourfold, wind power by 30, solar by 347 and biogas by 5. That is, overall, generation from renewable sources increased tenfold in 10 years. The end of the law leads to the disappearance of this exceptional framework that supported the initial growth in renewable energies:

• No new post-2025 targets have been set regarding the share of renewables in the energy mix.
• FODER is losing its central role as a guarantee mechanism.
• RenovAr has been exhausted as a policy for massive incorporation.
• MATER, which since 2022 has accumulated growth of 158%, is seeing its additional contribution diluted, limited by the lack of transmission infrastructure and the credit risk associated with this type of long-term project.

This poses major challenges for the development of the renewable energy industry and the energy transition in the country. If the state wants to give it new momentum, it will have to work on developing an incentive scheme, a new framework that guarantees the tax and legal security of investments, and on expanding transport infrastructure.

Regarding the alternatives that are currently in force, mention can be made of the Incentive Regime for Large Investments (RIGI), which provides tax and exchange rate stability, free availability of foreign currency, accelerated depreciation, and long-term legal certainty. In fact, YPF Luz has a project approved under this mechanism in the province of Mendoza, consisting of a solar park that will generate 305 MW with an investment of U$S 211 million (mn); however, a large share of renewable projects fall outside this regime due to their scale or design. 

The content is the sole responsibility of the author and does not necessarily reflect the opinion of BNamericas. We invite those interested in participating as a Guest Columnist to submit an article for possible publication. To do so, contact the editor at cesar.illiano@bnamericas.com