Thursday, June 1, 2023

What Argentina needs is to attract investment and lead energy transition, according to the United States

David Turk is the deputy secretary of the Department of Energy. On the day of the official visit to Buenos Aires last week, he met with the Secretary of Energy, Flavia Royón, with the aim of “promoting energy”, as he said in an interview with LA NACION.

According to the United States, Argentina has “tremendous potential” to lead the energy transition because of its wind, solar and hydrogen energy resources. “We want to be true partners, not only with the Argentine government, not only with the private sector, but also with Argentina. This is a journey, said the Turk, who was born in Ecuador and also lived in Chile.

And the official indicated that it is necessary “to have broader macroeconomic policies to have the kind of certainty that companies need to invest, whether in natural gas or lithium or in a variety of different technologies.”

– Can the United States be a partner as an investor or help US companies to invest in Argentina?

– We are open to exploring all forms of partnership. In the Department of Energy, we are responsible for a large part of the implementation of our national law to reduce inflation and other programs that will have a great opportunity in the bonds of countries around the world, not only in terms of minerals, but also. also the value chain, where I think there are huge opportunities. Where we can help in a tangible way with the Government is the sharing of two-way technical experience. We have many experts working on all types of clean energy technologies. Argentina, of course, does that too and that’s why we have an association called NetZero World. The US government has only a few select countries. Argentina is recognized for its immense clean energy potential. In the meeting at the Ministry, we were declaring those areas in which we want to have this technical cooperation, as priorities for the Argentine government.

– There are some experts in the field, especially oil and gas, who say that clean energy is too fast to have its economic price.

Yes, as our president said. [Joe Biden]Oil and gas are a critical part of our energy use in the United States, Argentina and countries around the world. Russia’s invasion of Ukraine has caused many countries to stand up for the security of our energy and food security, not only oil and gas, but seeing the enormous benefits of solar, wind and hydrogen energy security. If we can accelerate that transition, it’s good for the economy and also good for industrial security. In a country blessed with different renewable resources, it is profitable to speed up those deadly ones to benefit more from those technologies, especially for the Argentine people, but it is also for the world. For anyone who has done climate research – and here I know the drought, we had one in the United States, and there was a flood in Pakistan – we have very little time to act together as humanity to accelerate the progress of clean energy. . That is why we are waiting for the countries to try to shorten the timelines so that we can really move forward. We think it’s good for supply, for national security, for economic security, for credit as well.

David Turk, United States Deputy Secretary of EnergyEmbassy of the United States of America

– Is it possible to accelerate the energy transition with the growth rate in Argentina, but also in the United States?

It is certainly a challenge. The year 2022 was especially challenging for many countries in the world and it was certainly here in Argentina, and there is no doubt that countries must have stable regulatory actions. We all need to control inflation and have a certain predictability. We in the United States are fortunate to have passed clean energy legislation, where we will have tax incentives for 10 years to accelerate opportunities and provide financial certainty. There is no doubt, then, that countries all need to act together to create an environment in which these clean energy technologies can bring down the price. Members offer us discussions, ideas, suggestions, lessons learned from our challenges as well.

– There are analysts from the region who also point out that it is difficult to access technology (renewables vs. oil and gas), since 40% of the Argentine population is in poverty. Can that cause transition industry delays?

– I think it’s incredibly exciting what has happened in the last few years, and it will be even more so that the countries of the world really go up and invest more in clean energy. We already see that solar power, for example, is the cheapest thing in many parts of the world. Now that storage is in order, the other parts of the transmission equation need to be addressed. These costs will come down if we build at scale. Green hydrogen is the most interesting opportunity for Argentina, not only for domestic use but also for export, but it will require investment and will need to be scaled up and further reduce costs.

-Is hydrogen the industry of the future or can we already see projects running in the coming years?

“It’s going to be a little while.” There is a lot of work to be done about the costs now, especially with the production of hydrogen from solar and wind power through electrolysis. But there is no price tag. Some cost-cutting needs to happen, but we’re investing heavily in the United States, we’re building $8 billion hydrogen centers across the country, we have tax incentives to drive that market, and the more we do it at scale, the more it will happen. to bring down the costs. . Hydrogen provides an option specifically for the decarbonized sectors that are more difficult and I believe that European and other countries have a premium for fuels that do not have an emissions profile, we are all trying to reduce our emissions in the future. There are relatively few countries that have the potential for renewable energy and the potential of big players in hydrogen. Argentina is one of them, but it is not just going to happen, it will require a lot of work, a stable regulatory environment, a broader economic policy and a good image. But Argentina’s potential to be a big player there is one of the reasons why I’m here.

-Can we become a relevant player in liquefied natural gas (LNG)?

-Argentina is blessed with a large amount of resources, with gas, oil, solar energy, wind power, and many opportunities now to export that natural gas. What we saw with the Russian invasion is that Europe has an incredible thirst for natural gas. We have raised the price of gas and increased LNG exports. It also needs other triggers. It is impossible to predict for sure if this demand will continue, because the market is very dynamic. But Argentina is blessed with various natural resources and it is of course up to you to decide who will be invested in it.

David Turk, United States Deputy Secretary of EnergyEmbassy of the United States of America

– What do you think Argentina needs to achieve investment?

– Here I asked to organize myself and understand from all the businesses I had to meet: what needs to be done from a business perspective, what governments need to do, and what multilateral development banks need to do for everyone to work together. There is no limit to this kind of promotion. We all work hard. There are broader macroeconomic factors, namely inflation, currency, you know, all kinds of things that have to happen to have some certainty that companies need to make an investment, whet
her it’s in gas, lithium or a variety of natural technologies. It was incredibly eye opening and educational to understand, appreciate and diagnose what needs to be done. My hope is political will. Providing that opportunity depends on Argentina’s political system, government and people.

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