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Kicillof and a tariff adjustment to guarantee the supply of electricity

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The Province of Buenos Aires is preparing to authorize a further increase for light distributors who operate in their territory, thus completing a first phase of adjusting the bills of the area of ​​the country with the greatest number of consumers. The public and private expectation is that with these increases In three months the debt will be paid that all these companies in the country accumulate so as not to pay for the energy they send to users and that in January it surpassed $400 million in one month.

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The Buenos Aires adjustment will replicate the leap that the added value of distribution (VAD) has had since February in the Federal Capital and in the Conurbanit jumped above 230% last February for residential users and an even higher percentage for businesses and industries.

This is just one of the items in the price of electricity, which before the changes made with the current segmentation was equivalent to a third of the total tariff before taxes. In the metropolitan cards it now represents 21% of the final bill for families with the highest income, 63% for the poorest ones and 58% for the average in the metropolitan cards.

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For AMBA, as for the rest of the country, the value of electricity itself had previously increased, historically the item with the greatest relative weight in the bill.

These overlapping increases meant that a metropolitan user consuming between 325 and 400 kilowatts per month pays $26,200 if they are N1 (highest income category), $6,500 N3 (intermediate), or $6,200 if they are in the current N2 category ( inferior).

These values ​​cannot be extrapolated directly to the province of Buenos Aires, as each federal jurisdiction has its own table and although the increase is the same in percentage, the impact is different. But it gives an idea of ​​the current pattern.

The price of electricity is the same throughout the country. But distribution adjustments depend on the strategy of each jurisdiction, in the case of Buenos Aires, on the province’s regulatory body and the Ministry of Infrastructure. So the value of light varies greatly depending on the location in Argentina.

The ongoing increases are “transitional” because they are due to a global tariff review that will take place later in the year and which will seek to reflect a different philosophy in energy prices, including a mechanism to adjust them.

In talks with their regulators, Buenos Aires distributors failed to agree on an automatic inflation adjustment, which would have reassured them after this drastic upward adjustment in values.

Future increases will be periodically discussed and decided according to criteria not yet defined.

The new and imminent increase in electricity tariffs for all distributors in Buenos Aires, in line with what has already been authorized for Edenor and Edesur through the National Electricity Regulation Authority, This does not mean Axel Kicillof’s empathy with President Javier Milei’s worldview.

It’s really about oxygenate the accounts of service providers so that these they can pay without problems for the electricity they purchase.

Part of that cost is now covered by the national state Cammesa (Wholesale Electricity Market Administration Company), a state-run joint company that channels the subsidies. In February the national fund contributed 168 million dollars so that producers, the first link in the chain, can collect.

Another part will have to be paid by distributors. Since the tariffs are not enough for them, Unpaid obligations pile up. At the end of January they amounted to $430 million for November electricitycheaper than the current one.

This is a chronic problem, even more serious at this time when the La Libertad Avanza administration is less willing to continue closing the gap between what it pays for electricity production and what it pays for distribution. endangering the payment chain.

According to an official report from the end of January, most of the accumulated debt corresponded to distributors in the Metropolitan Area and the Province of Buenos Aires.

According to Cammesa’s financial administrative report from mid-January, it is a joint company managed by the State he had managed to collect only 22% of his calculated obligations for electricity distributed throughout the national territory.

Of a total equivalent to around 430 million dollars, they turned out to be the main debtors Edenor (113 million), Edesur (56 million) and the Buenos Aires companies Edelap (16 million), Edea (21 million), Eden (20 million) and Edesa (12 million).

This abbreviated list shows the relative importance of the companies providing Capital, Conurbano and the rest of the PBA with guaranteed payment capacity, as they account for more than half of the joint obligations.

Cammesa has already started several tests against the electric cooperatives, coincidentally, especially in Patagonia: Puerto Madryn, Trelew, Rawson and the Chubut distributor. But the judicial route may not be the most effective for carrying out these collections and guaranteeing the integrity of a system in presumed legal and economic transition.

The Energy Manager, Eduardo Rodríguez Chirillosupports something similar to that of the same companies in the sector: with the ongoing tariff increases, in June the electricity system he could be cured.

This would allow the beginning of a second phase in which the State I would stop intervening to allow distributors and manufacturers to understand each other directly through contracts.

Paradoxically, this lack of state intervention is so required by the private sector right now generates anguish. The manufacturing companies they have no guarantees be able to collect the electricity that until now ended up being paid for by public coffers, which are currently more reliable than cooperatives or private companies whose income is subject to regulations by the governments in office.

Despite very high tariff increases in all segments, distribution companies are also not very comfortable with the new tariff tables that generously recompose their revenues.

According to the executive of one of these companies, if electricity bills become difficult to pay for a significant number of users, they could find themselves in trouble. having to guarantee a public service, even to non-compliers.

Things aren’t easy for consumers either. According to an analysis by Santiago Urbizondo, chief economist of FIEL, regarding the Metropolitan Area, families who consume between 400 and 450 kw hours per month have already suffered a 600% increase in the fixed tariff. If a household’s demand rises to 600 kWh, the electricity bill will not fall below $82,000.

Added to this difficult challenge for the medium and low sectors, which represent 70% of residential users, is the fact that electricity has become 15 times more expensive for the “richest” in a short period of time. And the current regulatory framework prevents cross-subsidies, meaning some customers pay more so that others pay less, dilemmas to be resolved. with the reset of the system that the Government is attempting.

Source: Clarin

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