Legislative framework

In Argentina, the generation and usage of biofuels, as well as management of water resources, have regulatory frameworks that establish limits and scopes. The following is a summary of the main regulations concerning biofuels, water and their interrelationships. In the country, the regulatory framework on biofuels is based on the Law No. 26,093, enacted in April 2006, which regulates the production and sustainable use of biofuels and establishes a regime for its production. It is supplemented with the Law No. 26,334 which establishes the promotion system for bioethanol production. Among the promoting actions, the norm establishes a mandatory cutting consisting of the obligation to mix fossil fuels (diesel oil and gasoil) that are commercialized in the country with biofuels at a rate of 5% or more, measured over the total quantity of the final product. In 2010, the Secretariat of Energy of the Nation established the quotas that the biodiesel producers should have in order to supply the cutting (Resolution

7/10) that was raised to 7% (Resolution 554/10). These resolutions also establish the export quota of the biodiesel producers (Hilbert et al., 2011).

Regarding the protection of water resources, biofuels production enterprises must have an authorization to operate which is granted by the Secretariat of Energy of the Nation. This authorization is only granted when the enterprises fulfill the requirements related to quality of biofuels and sustainable production. In order for this to occur, the project must undergo an environmental impact assessment that includes effluent treatment and waste management. This procedure is performed according to the provincial legislation where the industrial enterprise settles down (Saulino, 2011).

1.1 Legislation Concerning Water

The outlook for the regulation of water resources in Argentina is complex, since it includes legislation at the federal, provincial and municipal levels (Saulino, 2011). To address this complexity, the National Law No. 26,438, enacted in December 2008, created the Federal Water Council (CoHiFe), an inter-jurisdictional agency comprised of the Argentine provinces, the Autonomous City of Buenos Aires and the Nation, where national and provincial water agencies are represented. This organization stands as federal body for consultation and coordination of federal water policy and harmonization of policies, legislation and water management in the respective jurisdictions, respecting the original ownership of water resources that correspond to the provinces (Del Campo, 2009).

Argentina is organized on the basis of a federal system, where the faculties retained by the Provincial Governments are not delegated to the Federal Government. In environmental matters, while the constitutional reform of 1994 gave the nation the authority to issue rules on minimum environmental protection, the provinces had the authority to approve those that were necessary to complement them. Thus, the provinces retain their territorial competition to complement the national legislation on the basis of the particular circumstances of their territory and environmental problems they face, but without being able to provide less protection than the one established by the national standard (Esain, 2008).

In addition, the Constitution recognizes municipalities as political entities, and states that the provinces have the duty to ensure their autonomy and regulate their scope. In many cases, the provinces have delegated responsibility to municipalities for the management of water resources, such as authorization and operation of industrial and commercial establishments, and the prevention and elimination of pollution in watercourses (del Castillo, 2007).

The outlook for the regulation of water resources in Argentina is therefore complex, since it includes legislation at the federal, provincial and municipal levels (Saulino, 2011). To address this complexity, the National Law No. 26,438, enacted in December 2008, created the Federal Water Council (CoHiFe), an inter-jurisdictional agency comprised of the Argentine provinces, the Autonomous City of Buenos Aires and the Nation, where national and provincial water agencies are represented. This organization stands as federal body for consultation and coordination of federal water policy and harmonization of policies, legislation and water management in the respective jurisdictions, respecting the original ownership of water resources that correspond to the provinces (del Campo, 2009).

The National Law No. 25,688 of 2002 establishes minimum environmental assumptions for water preservation and its rational use, which can then be supplemented by provincial and municipal regulations. This rule that regulates the use of water is part of all surface water and groundwater, as well as those contained in aquifers, underground rivers and the atmosphere. It is necessary to have permission from competent provincial or municipal authority to use the waters mentioned by the law. In the case of inter-jurisdictional watershed, the approval of the

corresponding Watershed Committee will be taken into account if the authorization has a significant environmental impact on other jurisdictions.

Most provincial legislations about water regulate the right to use public water and establish priorities for water usage based on the characteristics of their territories and economic activities (Del Castillo, 2007). Generally, these rules prioritize water for human consumption and favor the most interesting economic activities when water resource supply is limited. In addition, they fix the concession to the payment of a fee and reserve the right to revoke the concession due to public interest or breach of the terms.

1.2 Legislation related to biofuels

Regarding environmental quality standards, the law determines the Secretariat of Environment and Sustainable Development as the implementing authority.

Concerning the production of biofuels, bioethanol production is concentrated in the provinces of NWA, Tucumán (62.6%), Salta and Jujuy (35.9%), whereas the Province Santa Fe concentrates 76% of biodiesel production capacity in the country.

The effluents from sugar/bioethanol production processes stand as one of the major constraints facing the expansion of its production in the province of Tucumán. Even though provincial legislation prohibits the discharge of effluent pollutants to surface water and groundwater, the Sali River basin is facing serious pollution problems. To address this problem, in 2007 the Secretariat of Environment and Sustainable Development signed an Industrial Restructuring Plan with the sugar mills operating in the province of Tucumán (SAyDS, 2007). Based upon this plan, the sugar companies and distilleries were committed to discharge zero quantity of filter cake and vinasse to the Sali River. Four years later, five mills signed a new agreement under the aforementioned Industrial Restructuring Plan, which allowed them to access funding in order to improve their facilities for better environmental performance (SAyDS, 2011). The agreement also states that the companies will avoid all possible overturning of vinasse, which may be used for fertirrigation or disposal in saline lands with potential subsequent recovery (MSAL, 2011).