Generally, popular maxims respond to ancestral wisdom, that of the most common sense of all, that of the facts that occur in daily practice. “In the blacksmith’s house, a wooden knife” is one of those premises that apply more than thought. Thus, with a delay of almost 2 hours, the first public hearing began to adapt the new rates of the electrical energy service. Although it may seem like an extreme situation, last Friday the 26th the hearing began with delays due to a sudden power outage.
The truth is that once it began, the distributors of the Buenos Aires Metropolitan Area (AMBA), Edenor and Edesur, presented this Friday within the framework of the first public hearing called by the National Electricity Regulatory Entity (ENRE) , making known their concerns and estimated income generation requirements for 2024.
Electricity rates: What increases did Edenor and Edesur request? | Profile
Edenor’s requirement
Firstly, he began by exposing the company Edenor, the country’s main distributor, which operates within the northwest radius of Greater Buenos Aires and the northern area of the Autonomous City of Buenos Aires (CABA). As had been anticipated in the note presented to the ENRE, prior to the holding of the first hearing, his representative, Guido Hernandez confirmed the projection regarding the minimum income requirement to stabilize and cover its deficit situation. The estimated sum was confirmed in an amount by $521,303 million.
In this sense, the required increase represents an average increase of 89% that will impact the final bills of 80% of service users. Likewise, the company’s exhibitor explained that in the case of user customers with higher consumption, the increase will register a jump of 140% on average. This without failing to point out that said increase will be “well below the increases registered in other areas of the economy, or even in other mass consumption services such as Cable TV or Internet.”
Unusual: the tariff hearing was postponed due to lack of electricity | Fontevecchia mode
The new scales and tariff table
In the first hearing, Hernández presented information and graphical data to support what was required. According to what emerged from the hearing, 80% of the distributor’s clients, equivalent to 2.3 million users out of a total of 3.3 million, will receive tickets with an average increase of $7,619. On the other hand, within the 10% of highest consumption will reflect an impact on bills with an average amount of $33,771. At the same time, for the remaining 10% of user clients, with the highest consumption on the scale, the amount on the bills will be $68,425 on average. The increase would be equivalent to USD 7, still below the rate of other countries.
Likewise, the company highlighted that they do not receive subsidies from the national government for providing the distribution service. Along these lines, they went into greater detail, highlighting that the distributors function as a mere collecting agent and issuer of the invoice that finally reaches the users for payment. However, they emphasized that companies receive only 29% of the total collected. The rest of the invoiced amount, as stated above, corresponds to costs for generation (47%), taxes (23%) and transportation costs (1%).
In order to make a parallel, which removes the fear of the next increases in the electric energy service, the company exemplified: “With Edenor’s proposal, 8 out of every 10 clients would pay per month the equivalent of 8 liters of gasoline, ¼ kilo of ice cream or 750 grams of meat. This is an average of only $246 per day.”
Monthly and automatic updates
So, in accordance with the new rate table proposed by Edenor and what was stated in the first public hearing on rate readjustment, the company would only receive $2,209 per average invoice. Taking into account the context of high inflation levels and in order to avoid sudden jumps in invoices to be issued in the following months, the company proposed applying a monthly and automatic update scheme. This seeks to provide users with a panorama of greater predictability, which accompanies in a manner consistent with the inflationary process that the Argentine economy is going through and in line with the evolution of its prices.
Edesur’s proposal
For his part, Jorge Lemos, from Edesur, owner of the Edesur distributor, which operates in the south of the Autonomous City of Buenos Aires and the party-municipalities of the areas to the south and southwest of the AMBA, also expressed his concerns and formal requests. . However, the energy company did not give details regarding how in what proportion the final invoices would be affected of users with the impact of that request.
Its owner clarified that it only “poses the impact of the inflation gap on the distributor’s remuneration. That is why we understand that it is necessary to have a systematic and effective update of rates.” Thus, he presented the estimate on the income generation requirement also for 2024. In that sense, he specified that the company will require revenues that reach an amount of $330,000 million.
To highlight the seriousness of the situation, the company specified how much it collects from each invoice issued. “Of every 1,000 pesos that the user pays, Edesur only has $270 to pay salaries to your staff, its contractors, buy materials, pay its taxes and make investments. In 2023 we receive only 47% of the income needed to cover the service. To cover 53% during 2023, Edesur had to borrow from CAMMESA and request loans from shareholders.”
Also, Lemos emphasized that “with the current state of income, Edesur does not cover operating costs, the rate is not enough to cover the benefit,” while highlighting that at the regional level, Edesur’s rate is -13% of the average. of the Latin American rate, and that in Argentina, the AMBA “has the lowest average rates in the country, without any justification for this imbalance.”
This Monday it is the turn of the transport companies that will also make a detailed and thorough presentation about the situation they are going through. At the close of both hearings, it will be National Electricity Regulatory Entity (ENRE)who will be in charge of preparing a report open to the public with the publication of the new tariff tables for the electric energy service from February 1.
FM