In April of this year, Governor Ricardo Quintela, and after President Javier Milei and his Minister of Economy, Luis Caputo, decided to increase the electricity rate, made the political decision to roll back the measure, leaving it without effect – through a decree – the increase in the electricity bill throughout the province.
This was possible based on an enormous effort for the Province but it was necessary to do so in order to avoid aggravating the situation of the population and economic sectors. That is to say, the measure benefited both residential users and industries and commerce, since the increases were exorbitant figures that would hit the pockets of Riojans hard.
From the new tariff table at the beginning of the year, which was registered through resolution 07/2024 of the national government, increases were observed that modified the first seasonal table so far this year, observing an increase of 400 to 700%. According to the categories and in some variables such as, for example, power and transportation, between 1,700 and 3,500% were observed. This caused these variables to considerably increase the rate that users had to pay throughout the national territory, since these values refer to the active energy, power, transportation, generation of the entire national interconnected system.
From the table that was valid in November and December 2023 and January 2024, the great jump occurred in terms of energy values, where the reference value of 20,000 pesos per mega, jumped to 44,000.
This accompanied the inflationary policy that Javier Milei’s government proposed where it devalued the currency and prices rose in an escalating manner. The issue of energy was no different and since the proposal to remove subsidies began their reduction in the different categories of users.
It is necessary to emphasize that Governor Quintela took the same action at the time when the pandemic hit the population hard and in line with his thinking he decided to freeze the service rates and not make power cuts to users who could not face the pay. Consequently, it is an action to which the government of the province of La Rioja is already accustomed in its spirit of solidarity and with an ear to the people.
On the other hand, with regard to residential categories N 1, 2, 3, in the first increase ordered by the national government, the group that was most affected was category N1, which is called “without subsidy.” where an increase of around 800% could be seen. Here it jumped from a value of 20,000 to 44,401, which was equated to general users, industrial users, businesses, and small industries; This was also evident in the so-called public organizations, public lighting, in which, if the latest resolution 884/2023, which was in force since last year, is compared with the first 007/2024, these increases had a great impact on the general user. .
It should be noted that the governor of the province Ricardo Quintela decided to roll back the energy rates in the province and in this way accompany those affected by this first stage of removing the national subsidy.
The main request came from provincial producers who were affected since they use electricity to extract water and irrigate crops, in addition to different groups who fully suffered the removal of subsidies.
The resolution that was valid in the last quarter of last year and this year that covered February, March, April, the N2 and N3 categories suffered a very slight increase, maintaining the subsidy values, which were approximately in the N2 residential areas, which were the least well-off, a value was established that was maintained, and it was in the order of 2,900 pesos per mega, with no consumption limit and as of June 1, not only was there a new increase, but there was also a reduction of subsidies to those users who were in the N2 and N3 residential strip.
Resolution 90/2024 determined a subsidy reduction in N2, which previously had no consumption limit, and by which a consumption limit was established for warm and cold areas. In the case of La Rioja, it was doubly affected not only by the increase in the value of energy, which was affected by the limitation of the subsidy, but also because the province is located in a warm zone, where the subsidized consumption if we are compared to cold areas.
This is so, given that the so-called cold zones determined a subsidy of up to 700 kilowatts with a value of one mega, which was already indicated, and in the warm region 350 kilowatts.
That is, that category with the lowest income is no longer exempt from consumption, but rather has 350 kilowatts at a value that will differ from the plan. But now, the surprise is that this value, which was previously 2,900 pesos per megawatt, will now cost 16,055 pesos in that range of 350 kilowatts, which implies an increase of 440%.
Until 2023 there was no limit on what surplus was consumed in this N2 category, this was maintained during the last quarter of 2023 and the first increase in 2024. Now the surplus in energy use went from 2,900 to 57,214 pesos, that is, the lowest-income user will have 350 kilowatts at a value of 25,000 pesos per mega and what exceeds 350 kilowatts at 57,214 pesos. These people see themselves with an increase of 1,820%.
In the case of N3, the consumption of the subsidy dropped to 400 kilowatts, whose value was in the order of 3,700 pesos, and the surplus had to be paid in the order of 20,460 pesos per mega, which was the flat rate or without subsidy.
The last residential category, which is the second and last category of subsidies, is called intermediate income, which in the previous table enjoyed up to a consumption of 400 kilowatts with a differentiated price of 3,750 pesos within that subsidized band. Now, that category has a value of 25,200 pesos per mega and the consumption limit has been reduced to simply 250 kilowatts. The level 3 subsidized band decreased and the surplus that user N3, the user of an intermediate level, with intermediate income, will consume will be 57,214 pesos, the same value of surplus in both N3 and N2. So, the increases are observed from quarter to quarter.
Regarding these values, it is important to highlight that in 2024, through the resolution issued by the Ministry of Energy, these values were established for June and July. In August, September and October, another increase is already established that will go from 71,400 pesos, taking an average value since for the interconnected system, the seasonal price has a peak, value and rest. So, it is an average price that is taken. And if you take August, September, October, this 71,400 goes to 78,000 pesos on average.
There is already another increase that will govern August, September, October. Later, from the Ministry of Energy, new values will be established that will be the summer values. We will have to wait to know what this increase will be like. But the trend is that it is gradually increasing and everything is going to indicate that, in this last one, the quarter in which the summer period begins, we may already find ourselves without any type of subsidy for any category of users.
