CATAMARCA (ARG -TRANSMISSION NETWORK FL)

Promoter – Financial Intermediary

REPUBLICA ARGENTINA

Location

• Argentina

Description

Construction of the 220kV high Voltage Line between Alumbrera and the new El Eje substation, new HV 132kV line between El Eje and Belén, expansion of Alumbrera and Belén substations

Additionality and Impact

The project is part of Argentina's Federal Plan for Regional Power Transmission to expand, modernise and increase the reliability of the electricity transmission network. It allows the future connection of new renewable generation, helping to reduce the use of diesel-fired backup units.

The project will contribute to the Bank's objectives, in terms of Energy Security and Climate Action finance outside the EU. It is in line with EU priorities for Argentina and eligible under NDICI, contributing to climate change mitigation as well as to the development of social and economic infrastructure, specifically sustainable energy infrastructure and it will support Sustainable Development Goals.

The project will contribute to address the market failure associated with security of supply, which has dimensions of public goods, and the negative climate and environmental externalities through the reduction of carbon emissions and air pollution. The economic rate of return and social benefits are expected to be excellent and the project is supported by adequate governance and capabilities of the promoter. The EIB's advice has been sought by the promoter given that this is the first operation with this Promoter and given the complexity of some investments. 

Objectives

The proposed operation consists of a sub-operation of the framework loan Argentina - Transmission Network Investments FL (2022-0186), and it will be co-financed by the Inter-American Development Bank (IDB) and the French Development Agency (AFD). The project will boost transmission capacity increasing the reliability of the network and the hosting capacity to expand renewable energy transmission in the region. The project will contribute to EU policy objectives with regard to combating climate change, to the targets for decarbonisation and greenhouse gas emission reduction, in the context of the Intended Nationally Determined Contributions for Argentina, and to the Sustainable Development Goals, in particular the SDGs 7 (Affordable and Clean Energy) and 13 (Climate Action). The project is also eligible under NDICI (Neighbourhood, Development and International Cooperation Instrument).

Sector(s)

• Energy - Electricity, gas, steam and air conditioning supply

Under Global Europe NDICI guarantee

Under EFSD+ Guarantee

Proposed EIB finance (Approximate amount)

EUR 22 million

Total cost (Approximate amount)

EUR 73 million

Environmental aspects

The Bank will require the Promoter to ensure that the implementation of the project will be done in accordance with the Bank's Environmental and Social Principles and Standards.

Procurement

The project will benefit from the Procedural Framework (PF) with the Inter-American Development Bank (IDB) for Mutual Reliance in procurement of jointly co-financed operations in Latin America and the Caribbean signed in April 2022. In accordance with this PF, there will be no restriction of eligibility on the origin of contractors/suppliers and notices will be published in the Official Journal of the European Union.

Status

Approved - 5/12/2023