The Government's conditions for electricity companies to authorize rate increases

He Government has adopted a firm stance regarding electricity distribution companies, demanding a significant improvement in the quality of service as a condition for authorizing rate increases. This measure seeks to address the recurring problems of power outages and improve the user experience in the Buenos Aires Metropolitan Area (AMBA).

The National Electricity Regulatory Entity (ENRE) has called two public hearings for the end of January, where the parameters of the transportation and distribution of electrical energy businesses will be defined for the next five years, which is of interest to the Government to take new measures.

The Government's conditions for electricity companies to authorize rate increases

In these hearings, the quality of the service that the companies Edenor, Edesur and Transener must offer will be analyzed, as well as the investments necessary to improve the network and reduce the duration and frequency of power outages.

The objective of Government is to reduce by 40% the duration and frequency of power outages in some municipalities of Greater Buenos Aires, where the service has poorer quality. In the City of Buenos Aires, where the service is relatively better, an improvement of 30% is sought.

The Government's conditions for electricity companies to authorize rate increases

These goals are ambitious and require a significant commitment from distribution companies. The ENRE has established specific quality parameters that companies must meet to obtain authorization for rate increases. These parameters include the average duration of power outages (SAIDI) and the frequency of outages (SAIFI).

For example, in some municipalities of Greater Buenos Aires, the goal is to reduce the duration of outages to between 2.8 and 3.3 hours per semester and the frequency to between 1.2 and 1.4 times per semester. In the City of Buenos Aires, the goals are to reduce the duration of outages to between 2.55 and 2.8 hours and the frequency to between 1.08 and 1.19 times per semester.

The Government's conditions for electricity companies to authorize rate increases

Service quality

In addition to improving the quality of service, the Government It has also toughened sanctions for companies that do not comply with established parameters. These sanctions include fines for supply outages, repeated and prolonged outages, voltage fluctuations, improper suspension of supply, poor service in commercial offices, incorrect billing, and other non-compliance.

The goal is to ensure that companies do not neglect any particular user or area. The Government has made it clear that improvements in service quality are a necessary condition for authorizing rate increases. Companies in the sector, for their part, seek to maintain their income in real terms and obtain a regulatory framework that facilitates the conditions for accessing financing. Proposed rate increases will not exceed 9.9% in April, and monthly increases are expected to remain below past inflation.

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