The Government froze the gas rate

The Government froze the gas rate
The Government froze the gas rate

The measure was confirmed through the Official Gazette through Resolution 224/2024 this Monday. The Ministry of Economy presented to the Ministry of Energy that “in order to consolidate the disinflation process carried out by the Government, verified to date, It is reasonable and prudent to postpone in the month of May the effective application of the updates provided in the resolutions of the Entities mentioned above and the increases in the PEST corresponding to electrical energy and the PIST in gas.”

Days ago, the presidential spokesperson, Manuel Adorniwas consulted about it and responded: “We have not made any determination yet but it may happen that with a fiscal surplus we can adjust some issues and accommodate so that there is effectively no additional burden on the people,” Adorni added.

During his presentation before the CICyP, President Javier Milei admitted that in the first months of his government the adjustment had been “overreacted” due to the inherited situation.

Faced with this situation, the Ministry of Energy informed the Licensees of the Public Gas Transportation and Distribution Service and REDENGAS SA that the tariff update scheduled for the month of May 2024 would not proceed, so they would remain in force. and without modifications the tariff tables published in the Official Gazette on April 3, 2024.

In fact, the National Gas Regulatory Entity (ENARGAS) arranged “keep unchanged the Transition Rate Schedules and Rates and Charges for Services in force since April 3, 2024”.

Gas rates: how much they were going to increase this month

The increases that had been established were going to have an impact above 350% and in some cases far exceeding 400%. For example, an “R1” user in Capital Federal—the category that includes 53% of households—was going to pay about $7,000 per month, according to the distributor’s calculations.. It implied an increase of 352% compared to the $1,547 paid until now.

While a user of the same category R1 of the Province of Buenos Aires was going to pay an estimated bill of $7,400 per month. An increase of 390% compared to the $1,512 that was paid until last month.

An user R22on the other hand, was going to go from paying $4,527 to about $25,200 per month, that is, 456% more than before.

Electricity and Gas Tickets.jpg

In some cases, the increases were going to be above 400%

Photo: Ámbito

Gas rate: what is the impact on inflation

The Minister of Economy, Luis Caputo, moved forward with the freezing of rates to avoid their subsequent transfer to prices when the Government has just celebrated the drop in inflation in the last month. April inflation marked a slowdown to 8.8% after 11% in March, 13.2% in February, 20.6% in January and 25.5% in December after the devaluation. However, last month the Indec registered a strong increase in the public services category, which jumped 35.6%, accumulated 110.5% so far in 2024 and 311.6% in the last 12 months. The official intention is that the general CPI for May will once again show a decrease.

 
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