What should Argentina do?
Enhance its NDC to be 1.5C aligned by COP26
To be within its fare-share range compatible with global 1.5°C IPCC scenarios, Argentina needs to reduce its emissions to below 205 MtCO2e by 2030 and below 55 MtCO2e by 2050. As per its second NDC, submitted in December 2020, Argentina has an absolute, economy wide and unconditional target of not exceeding the net emission of 359 MtCO2e in 2030.
Build a just and resilient recovery plan:
- Set a clear pathway for clean energy by progressively eliminating fossil fuel subsidies and limiting the exploitation of new oil and gas reserves, as well as offshore exploration. The renewable industry should receive incentives. Moreover, grid transmission investment are needed, and distributed generation (already turned into law) requires regulation and proper incentives
- A Just Transition plan could have a positive impact. Union and workers’ associations are key players in national politics, and the country has the resources to make this a success
- Shift to sustainable agricultural practices and stop deforestation: land-use accounts for more than a third of Argentina’s GHG emissions, and deforestation and forest fires have gone wild during the pandemic
- Public bailouts and subsidies for the oil and gas sector
- Incentives for unsustainable agricultural practices
What should be known about Argentina?
- Energy makes up 53% of Argentina’s GHG emissions, and has increased from 98 MtCO2eq in 1990 to 193 in 2014. Burning of fuel accounts for 94% of the emissions
- Among the strongest barriers against decarbonization are major investment plans in natural gas and the subsidies allocated to it. In 2016-18, fossil fuel companies (national and international) received $3.66bn in subsidies for shale gas exploitation
- If exploited to their full potential, Argentina’s shale gas reserves could consume 11.4% of the remaining global carbon budget to reach 1.5°C
- In its 2015 Renewable Law, Argentina set the target of an 8% share of renewables in national electricity by 2018 and 20% by 2025. The goal was not reached: in 2019, the average was 6.1% (+133.2% from 2018’s 2.5%)
- Argentina is part of the Alliance for Climate Ambition and, as of December 2019, has a Climate Change Law. In 2019, former President Mauricio Macri announced the country will be carbon neutral by 2050, a commitment that was also stated by current President Alberto Fernández at 2020’s Climate Ambition Summit. However, no measures were set forth in order to achieve the goal.
- Agriculture, livestock, forestry and other land uses contribute 39% of national emissions. Deforestation remains a central challenge
- Argentina has passed US$26bn in fiscal stimulus measures. However, no ‘green’ measures are included. Instead, the Government artificially fixed the domestic oil price at a minimum of $45 per barrel for 2020, irrespectively of the fact that international oil prices remain considerably lower (which constitutes a direct subsidy to rescue the sector); and capped electricity and gas tariffs to December 2019 levels until the end of 2020
Recent developments, threats and levers for action
- Argentina has passed US$26bn in fiscal stimulus measures. A significant portion of it is directed towards polluting industries. Targeted measures have mainly supported (without environmental conditions) nonrenewable energy
- Argentina’s Government has not yet introduced any ‘green’ measures in its recovery stimulus plans. Instead, it artificially fixed the domestic oil price at a minimum of $45 per barrel for 2020 (which constitutes a direct subsidy to rescue the oil and gas sector in Argentina), irrespectively of the fact that international oil prices remain considerably lower, capped electricity and gas tariffs to December 2019 levels until the end of 2020, and created a new gas subsidy scheme that will run from 2020 to 2024.
- Climate action is not a priority of Argentina’s current Administration: the focus is on addressing the economic crisis that pre-dates the pandemic but has been exacerbated by it, putting further climate policy developments into jeopardy
- Argentina delivered a new NDC in December 2020 with a more ambitious goal towards 2030 (26% emissions reduction vs. 2016 NDC), and is set to present its LTS by COP26 at the latest.
- Agriculture, livestock, forestry and other land uses contribute 39% of national emissions. Deforestation remains a central challenge and has been going rampant during the pandemic, mainly to expand the frontier for agricultural-livestock activities and real estate
- Key economic/trade partners include China, Brazil, the US and the European Union
- Argentina’s renewable potential
- Less than 1% coal in the energy matrix
About Climate Diplomacy Snapshots
The data is clear. Accelerated and enhanced action is needed now to build resilience and avoid the worst impacts of climate change. As they seek to address the ongoing health, economic and social impacts of COVID-19, governments should seize opportunities to invest in a recovery that will build social, economic and climate resilience on the long-term.The Climate Diplomacy Snapshots aim to provide the climate community with a clear overview of what each country should do, on climate and recovery, to pursue these joint objectives and keep the global average temperature increase to 1.5°C. Each has been prepared with the help of national experts, and will be regularly updated. The snapshots aim to support climate advocacy in the lead up to COP26.