“TerCONF" National and International Call for Bids

Resolution No. 621 of the Secretary of Energy, published in the Official Gazette on July 27, 2023, launched the National and International Call for Bids called “TerCONF” for awarding thermal power purchase agreements (PPA) with Compañía Administradora del Mercado Mayorista Eléctrico SA (CAMMESA).

This bidding process is the first thermal power tender since 2017 and raises important expectations of thermal power players, especially because of the current restrictions substantially limiting corporate thermal PPAs.  

The Secretary of Energy seeks to award a total referential minimum of 2,280 MW divided into:

1. Line 1, thermal generation for reliability and supply to the SADI (2,250 MW).
2. Line 2, thermal generation to replace, modernize, and make more efficient the thermal generation in the Province of Tierra del Fuego (30 MW).

Line 1, in turn, aims at:

1. Enhancing existing combined cycles.
2. Improving supply in critical areas.
3. Improving efficiency and regional reserves.
4. Improving supply reliability.       

Depending on each line and its objective, the required installed capacity for each project varies between a minimum of 15 MW and a maximum of de 660 MW.

The maximum reference price for contracted capacity (18,000 USD/MW-month) also varies according to adjustment factors determined for each line and objective. The PPAs also establish payments for supplied energy, pursuant to the term and conditions set in these agreements. In all cases, the amounts in USD would be paid in ARS.

Overall, the PPA template follows the term and conditions of the PPAs awarded in previous public tenders (specifically, tenders launched through resolutions No. 21/2016 and 287/2017 of the former Secretary of Electric Energy). In this tender, the term of the PPAs is up to 15 years, according to the proposed objective and the commercial operation date.

Different from previous thermal bids, this bidding process does not require a contract guarantee (equivalent to performance guarantees under procurement regimes). Instead, it sets a payment schedule between the awarding of the PPA and the project’s commercial operation date.

The schedule for the bidding process is tight. In principle, the consultation period ends next August 29, and the bids must be submitted on August 31. PPAs would be awarded on October 10. However, since the bidding process was launched with certain delay, it may be postponed.

Find more information on the bidding process here: https://cammesaweb.cammesa.com/terconf/.