What does the AGN report say about wind farms?
The audited period covered from May 18, 2016 to December 31, 2021. The main objective of the audit was to verify the management, monitoring and control of the Ministry of Energy, regarding the planning and design of the Renovar program, promptly. in its relationship with the objectives of Law 27,191 “Law for the Promotion of Renewable Energy” and the needs for diversification and federalization of the national energy matrix.
The Renovar program is the set of bidding procedures aimed at contracting in the Wholesale Electricity Market (MEM) of electrical energy from renewable generation sources, based on the granting of tax benefits, payment priority, priority in dispatch, financing and guarantees through the Fund for the Development of Renewable Energy (FODER), as promotion tools.
The report contains 126 pages and was approved during a session of the College of Auditors General. The president of the AGN, Jesús Rodríguez, and the general auditors Francisco Javier Fernández, María Graciela de la Rosa, Juan Ignacio Forlón, Gabriel Mihura Estrada, Miguel Pichetto and Alejandro Nieva participated in the meeting.
What are the main findings of the audit?
- The Resolution of the former Ministry of Energy and Mining (MINEM) 202/16 allowed the application of the benefits of Renew (round 1) to companies awarded previous programs, without participating in the bidding procedure. Consequently, inequitable situations were generated with the participants of Renew round 1 and those of the following rounds.
- The companies authorized to sign contracts within the framework of the former MINEM Resolution 202/16 obtained prices higher than those established for the companies awarded the Renew round 1.
In this sense, the execution of MEM supply contracts was authorized within the framework of former MINEM Resolution 202/16, to the following companies with CAMMESA with prices of US$72.33 per MWh and US$76.23 per MWhthat is, higher than those theoretically calculated by the Audit.
The maximum price awarded for round 1 of Renovar was US$67.19 per MWh. In rounds 1.5. and 2 the price continued to fall, in US$54 per MWh and US$41 per MWh respectively.
That is to say, an unequal situation arose between the companies that competed in round 1 of Renovar and those that joined its regulations through the Former MINEM Resolution 202/16.
- The Program’s risk distribution scheme was tilted favorably towards companies, to the detriment of the State. The National State even became the guarantor of third-party obligations, contingently committing its own resources through the assumption of commitments with international organizations.
- Lack of knowledge of the Enforcement Authority or omission to inform this Audit, regarding transfer operations and/or share transfers, of some of the companies authorized to sign contracts within the framework of former MINEM Resolution 202/16.
Based on the analysis of the opinions and resolutions issued by the National Commission for the Defense of Competition and the Secretariat of Commerce of the former Ministry of Production, the following situations were found:
1) The companies PARQUE EÓLICO LOMA BLANCA I, PARQUE EÓLICO LOMA BLANCA II and PARQUE EÓLICO LOMA BLANCA III, which entered the Program through the former MINEM Resolution 202/16, as previously stated, were sold by the ISOLUX Group, made up of the ISOLUX CORSAN SA Group, ISOLUX INGENIERÍA SA AND ISOLUX INGENIERÍA ARGENTINA SA, to the company SIDSEL SA, made up of USIR SA, SIDECO AMERICANA SA (controlled by SOCMA AMERICANA SA) and SELENA PARTNERS SA, dated 01/25/17, is that is, after the issuance of the aforementioned resolution, but before the authorization of the execution of the respective contracts.
Then, the company SIDSEL SA transferred 100% of the shareholding of PARQUE EÓLICO LOMA BLANCA I to the firm GOLDWIND INTERNATIONAL HOLDINGS LIMITED and GOLDWIND INTERNATIONAL JANSHNA LIMITED, on 05/24/17. As stated in the previous point, the LOMA BLANCA I WIND PARK entered the Program through former MINEM Resolution 202/16.
2) GENNEIA SA purchased from SIDELI SA, the shares and rights of the company ISOLUX CORSAN ENERGÍAS RENOVABLES SA, over the construction and exploitation of the LOMA BLANCA IV SA WIND PARK, located in Trelew, Province of Chubut. The operation took place on 08/29/17. This park was producing renewable energy from the GENREN program, the original contractual conditions being applicable according to former MINEM Resolution 202/16 (article 3).
Although the contracts establish that the selling party must notify CAMMESA of operations related to assignments, liens and/or transfers of rights and obligations within the framework of the contracts, the truth is that the lack of knowledge of these situations on the part of the Authority Application prevents not only the effective and efficient exercise of its control and sanction function, but also taking measures in cases of non-compliance with the Public Ethics Law and complementary regulations.
Furthermore, the former MINEM, in its capacity as the FODER Application Authority, could not be unaware of the corporate situations of the beneficiaries of the trust.
The purpose for which the Program was implemented is eminently public. Leaving control linked to the transfer of shares exclusively to CAMMESA implied a risk of affecting the principles of transparency, equality and competition, which are priorities in public tenders.
- In the same sense as described in the previous finding, situations of share alienation were confirmed that were not known or not reported by the Authority of Application to this Audit, within the framework of the Renew.
1) SIDECO AMERICANA SA purchased the assets and rights related to a future wind farm project from the firm WPA SA, which would be transferred in favor of a firm controlled by the buyer called PARQUES EÓLICOS MIRAMAR SA in the Province of Buenos Aires, ultimately awarded the contract. round 1.5. The operation took place on 05/19/16, one day after the publication in the Official Gazette of the call for round 1 of Renovar (05/18/16).
2) GENNEIA SA. bought from the firms 360 ENERGY SA. and ENERGIAS SUSTENTABLES SA. the shares and rights of the firms ULLUM SOLAR 1 SA, ULLUM SOLAR 2 SA and ULLUM SOLAR 3 SA, in San Juan, winners of round 1.5. dated 04/09/18.
3) PETROQUIMICA COMODORO RIVADAVIA SA and PETROMIX SA purchased all of the issued and outstanding shares of PARQUE EOLICO DEL BICENTENARIO SA, owned by the firms ABO WIND ENERGÍAS RENOVABLES SA. and ABO WIND AG., winner of round 1.5. The closing of the transaction and transfer of shares took place on 08/08/16.
37% of the power awarded by the program failed to be installed, reducing the expected benefit and slowing the expansion of renewable generation.
Renovar failed to install projects that contractually committed energy at more competitive values, negatively impacting the average price of renewable energy.
- The Renovar contributed less energy than expected for each round, reducing its contribution to the objectives of the Development Regime.
- The application of an erroneous exchange rate was detected in the calculation of the tax benefits of Rounds 1 and 1.5, both at the time of their award and at the time of their granting, which implied a recognition in excess of 4.6 million USD .
- The former Undersecretary of Renewable Energy failed to comply with the provisions of Decree 202/17 linked to the communication of the positive Sworn Declaration of Interests to the Anti-Corruption Office (OA) and SIGEN.
Source: Ambito
