On 27 December 2017, Law No. 27,424 was published in the Official Gazette, creating the Promotion Regime for Distributed Generation of Renewable Energy Integrated in the Public Electricity Grid.

The Regime creates a new electric market agent: the "user-generator," which is the user of the energy distribution public service that installs the necessary equipment to generate renewable energy for self‑consumption, and injects the excess in the public grid.

Among others, the Regime includes:

  • the procedure that the “user-generator” shall follow with the distributor to obtain the authorization to connect its equipment into the public grid;
  • the obligation of the “user-generator” and the distributor to enter into an energy distributed generation agreement;
  • the billing scheme to compensate the cost of the energy provided by the distributor and the value of the energy injected by the “user-generator;"
  • the creation of the Fund for Distributed Generation of Renewable Energy, which will be used to grant loans, incentives, guarantees, capital contributions and the acquisition of other financing instruments to implement distributed generation systems of renewable energy;
  • the creation of the Regime for the Promotion of National Manufacturing of Systems, Equipment and Components for the Distributed Generation, which includes tax incentives and other promotional benefits (financing with preferential rates) to the national activities directed to promote the distributed generation of renewable energy; and
  • the obligation to include distributed generation systems in national public buildings, and the invitation to the provinces and the City of Buenos Aires to adhere to the Regime’s provisions.

It is expected that the Regime’s complementary regulations will be issued in the first months of 2018.

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