Edenor and Edesur requested a emergency peak in electricity bills. Both accused the “granting power” (the national state) of not respecting the regulatory framework that regulates the provision of the electricity service in Buenos Aires. Its executives said they had lost money and necessities an immediate increase in bills of between $1,000 and $1,500 a month to go red-free in 2023. It was during a “virtual” public hearing held on Monday.
Walter Martello, controller of the regulatory body (Enre) opened the hearing with the tip caps. Twelve days ago, the CEO of Edesur’s owner said the company was leaving Argentina because “the country has the most bizarre regulation in the world,” as he put it. clarion in exclusive. The official took the opportunity to answer him in very harsh terms. And, at the same time, he seemed to be postponing the definition of rates to the last quarter of 2023, that is, after the presidential elections.
“We believe that the truly bizarre, in the sense of ‘strange and extravagant‘ as defined by the Royal Spanish Academy, is to claim first world rates while offering third world quality of serviceMartello criticized. Francesco Starace, Enel’s chief executive, told Harvard that Edesur “will work with local investors in the future.”
“They can’t run a business in a non-competitive market with constrained users,” Martello said in an attack on Edesur. “Distributors will not get the rate they ask for, but the one users can pay in the current economic and social context,” he anticipated. “We are considering holding a new public hearing on the tariff adjustment in the fourth quarter of this year,” she added.
a third of families has had increases in electric bills since October. But that raise doesn’t stay in the hands of the distributors. This increase is such that the nation state subsidizes less the cost of electricity. It is part of the segmentation process.
The Energy Ministry has decided to remove subsidies from the so-called high-income sectors, which earn more $400,000 a month or they want access to “dollar savings.” Those customers will pay the electric cost without discount from February. Until now, they had partial withdrawals of benefits.
But Edenor and Edesur have had no increases in this segmentation process. They charge their customers more, but the money goes to Cammesa, or to the generators, they claim. For this reason they are asking to be allowed increases in the inflation rate this year. Edesur said half of its clients pay $1,800 a month. And that, without increases for its service, it would lose almost 120 billion dollars during this year. In 2020 and 2021 she also scored similar reds.
Federico Méndez, from Edenor, dared to clarify how the requested increase would be transferred to the polls. According to their numbers, with the redial they ask, 80% of residential users would pay close to $2,800 a month. In the event they don’t get that raise, Edenor would lose more than $200,000 million.
The Legislature voted in the 2023 budget that both companies should adjust their tariffs this year, further emphasizing that the distributors could renegotiate their debts with the wholesale administrator Cammesa, to whom they owed unpaid bills from the 2020 and 2021. In that decision, Edesur was forgiven $19,000 million in debt and Edenor, $24,000 million in principal. Furthermore, they were also allowed not to pay another million in interest.
“What is being discussed in this hearing is that the change in costs due to inflation is recognized by Edesur,” said Jorge Lemos, of that distributor. Although his presentation was written before hearing Martello’s criticisms, the executive showed some definitions of the Ministry of Energy in relation to distributors.
“The lack of periodic update of the distribution value added (VAD) – the service provided by companies – negatively affects the management of distributors and quality,” Energía explained in a paper in which it analyzed the state of the sector in 2022.
Edesur has demonstrated that the electricity rates of the Buenos Aires distributors are the lowest in the country. In Mendoza, the company that provides the same service charges almost two and a half times as much. The average tariff in Argentina is US$120 per MWh (an industry measure), but in Buenos Aires this service is paid US$70.
The distributors they keep 17% of what they charge customers on tickets. More than half goes to generators and 25% is taxes. It happens in Buenos Aires. Inland -especially in Córdoba, Santa Fe and Tucumán, for example-, vending machines have a greater share of tickets.
Source: Clarin
