The distributors Edenor and Edesur requested this Monday a rate increase that allows to face the operating costs in the course of 2023although they did not give details on the percentage increase in invoices.
The representatives of Edenor, Federico Méndez, and Edesur, Jorge Lemos, presented their proposals at the virtual public hearing convened by the National Electricity Regulatory Entity (ENRE) to analyze a “temporary adjustment of electricity distribution rates”.
Lemos, at the end of his presentation, told those who wonder “why do we continue if the business doesn’t work” he answers “very simple, we are very responsible and we have a great vocation for service”.
Méndez pointed out that if the requested rate adjustments are applied, “80% of residential users” in the company’s coverage area will pay an average bill of $2,757 per month.a level necessary to face an operating deficit that, without any increases, would reach $205,760 million throughout the year.
Lemos did not give examples of average invoice values, but warned that Edesur’s operating deficit would be $118.6 billion if there were no rate adjustment.
Both representatives They stressed that the rates resulting from the required increases would continue to be “well below” those for cable television, internet or cell phone services.
They also remarked that the distribution stage “does not receive subsidies” from the national State and they complained about what they considered discriminatory treatment in relation to the generation stage, the two components of the final rate together with the transportation stage, and the national, provincial, and municipal tax burden.
Méndez indicated that Edenor’s rate currently consists of 56% Generation, 20% Distribution, 1% Transportation and 23% Taxes, but that five years ago distribution had a 33% share and generation of 42%.
This difference, he assured, was due to the fact that “all the increase in the bill derived from the segmentation was destined for the generation stage and the oil companies”, in such a way that currently “of every thousand pesos that are paid for an invoice , Edenor only has 200 left and it is the only income it receives for material salaries and investments”.
To highlight the gap between distribution and generationindicated that in 2022 Edenor increased its rate by 8% (within the total increase) and the generators up to 285%, “without there being a reason to justify this difference.”
Similarly, he argued that “Edenor did not distribute dividends in the last 21 years”, but that in that period the generators did so for “more than 960 million dollars”.
“This situation could not be sustained over time, we do not believe it is fair that we have such a different treatment”he concluded.
For his part, Lemos made reference to a document from the Ministry of Energy in which it is recognized that the resolution of the tariff issue is “prevailing” and pointed out that of the total final service fee, 17% corresponds to the company, while 58% goes to attention to the cost of energy and 25% to taxes.
Likewise, he said that the rate charged by Edesur is 53% lower than the average of the rest of the companies in Latin America and that it is lower than those of the rest of the country.
The Edesur representative asserted that “50% of the users pay a fee of less than $1,800, of which the company has $306 left.”
“We see ourselves in a regime of obligations without its corresponding remuneration,” he stated, to add that “in the last three years the completion of the Comprehensive Tariff Review (RTI)” has been postponed, suspended in 2019 by the Emergency law.
