Argentina’s distributed generation sector is rapidly expanding due to higher electricity tariffs, lower equipment costs, and shorter solar project payback periods of around 3–4 years. Growth has accelerated since 2019, reaching over 4,000 user-generators and 143 MW installed, with strong private-sector-driven adoption.
Buenos Aires, Argentina
Image: Mario Ame, Unsplash
From pv magazine Latam
Argentina’s distributed generation (DG) sector is experiencing strong growth, driven by recent electricity tariff adjustments and improving project economics.
“As of today, the wind is at our backs in Argentina,” Argentinean electrical engineer and PV specialist Martín Ponsá told pv magazine.
He explained that electricity tariffs “were frozen in 2019” and that subsequent rate increases have significantly altered the economic equation for photovoltaic projects. He added that “equipment prices—specifically for inverters and panels—are at historic lows” and that there is “significant competition in the labor market,” factors that have considerably reduced project payback periods. “Previously, when you calculated the amortization, it came out to seven, eight, or ten years; today, it hovers around three or four years,” he noted.
Ponsá began working in the distributed generation sector in 2019, following the implementation of Law 27,424. As he recalled, at that time “there were no professionals available to officially certify” projects, and “nobody knew anything—neither they nor we did”—referring to utility companies such as Edenor and Edesur. He explained that he learned the necessary procedures alongside the utilities themselves and has since specialized exclusively in the bureaucratic and technical management required to authorize user-generators. “I act as a partner to the installers; I work hand-in-hand with them,” he stated.
The specialist indicated that he has already participated in nearly 400 user-generator authorizations, spanning both residential and industrial installations. He estimated that these projects represent approximately 7 MW of cumulative installed capacity. “In the context of distributed generation, that is a substantial amount,” he asserted. He also noted that around 70% of these installations belong to residential users and that, while initial growth was concentrated in gated communities and private residential estates, “the industrial sector is now recognizing the opportunity to enter the market, and they are indeed entering.”
Regarding the evolution of the Argentine market, Ponsá highlighted that in 2019 there were barely 67 registered user-generators; by March 2026, that figure had risen to 4,253 users, with a total installed capacity of 143 MW. He clarified, however, that the actual figure is likely higher, as off-grid installations and systems that never completed the formal grid connection process are not included in official statistics. “There could be more than 40% of installations that go completely unnoticed,” he asserted.
Regarding the role of electricity distribution companies, he observed that some firms still view distributed generation “as a bogeyman,” although he maintained that the sector also presents new business opportunities. “Every change compels us to reinvent ourselves,” he said, noting the possibility that cooperatives and distributors could develop their own solar farms to reduce supply costs.
Ponsá also highlighted that Argentina has begun implementing tax incentive programs for energy efficiency and renewable energy. As he explained, the recently enacted Decree 242 provides incentives for investments in solar panels, energy storage, and energy-efficient equipment aimed at small and medium-sized enterprises (SMEs). “That also aids in the amortization process,” he stated.
The engineer argued that Argentina’s market development still lags behind countries such as Brazil, Chile, and Colombia; however, he praised the fact that local growth has been driven “purely by private effort,” within a context of limited financing and a historical lack of incentives.
Finally, he noted that one of the models he is keen to promote in Argentina involves on-site power purchase agreements (PPAs) for industrial clients, similar to those he observed while working in Spain. Although he acknowledged that “economic hurdles” remain, he maintained that the model could be successfully replicated locally. “There are plenty of things we can copy and emulate that are already working elsewhere in the world,” he concluded.
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