It will be from June. The measures were confirmed through resolution 91/2024 of the National Energy Secretariat, published in the Official Gazette. EFFECT
At the height of insensitivity, the Government of Javier Milei decided on a new increase of at least 65% in electricity rates for medium and low-income users during the month of June. This is another increase in the seasonal price of energy, which, added to changes in the subsidized limits for levels N2 and N3, will have an impact on the monthly bill, among a variety of other increases that are already in force. such as gasoline, rent, cell phones, bread, vegetables, etc. As if all this were not enough, gas will also increase by 155%.
This was announced in resolution 91/2024, made official at dawn in the Official Gazette through the Ministry of Energy headed by Eduardo Chirillo and dependent on the Ministry of Economy of Luis Caputo, right hand of Javier Milei.
The government then decided that the seasonal price of energy will increase to $57,214 per megawatt/hour “as a result of the freeze that the service has had on the wholesale scale for more than a year.” A subsidy of 71.9% is applied to this number for low-income residential households and 55.9% for medium-income households that are already associated with the bonus.
The new value of wholesale energy for an N2 home increases by more than 400% and goes from $2,981 to $16,074 per MWh. While for an N3 household the increase in the wholesale component will amount to more than 550%, that is, it goes from $3,756 to $25,219.
Percentage-wise, this is an increase in the user’s final bill of between 65% and 85% when there are days left until winter, without any consideration for the suffering population of the entire country, which is already enduring increase after increase in all essential items.
The Government did not take any of this into account and decided to implement changes in the monthly kWh of the two lowest levels.
In the case of low-income users, until now they had no limit to access the system’s bonus. However, this was left behind. Starting in June, those who belong to group N2 will pay the new discounted wholesale price only for the first 350 kWh per month and the rest of the consumption will be applied to $57,214. That is, 1800% more for the wholesale component.
For the N3 middle-income group, the limit of 400kWh per month was modified and reduced to a total of 250kWh. Levels N2 and N3 represent 65% of consumption. The other 35% are the high-income users of group N1, who were paying the cost of higher wholesale energy. For this scale the price rises almost 39% ($44,401 to $57,214), that is, around 10% on the ticket.
In this way, the government of Javier Milei deals a new blow to the pockets of Argentines at a time when the UCA Observatory announced that the poverty rate reached 55.5% in the first quarter of the year. Analysts point out that only a government with such insensitivity can allow this situation.
Increased gas
Through Resolution 91/2024, the price of natural gas at the Point of Entry to the Transportation System (PIST) was also established to be transferred to the final rates. The PIST is the price of gas consumed by users, whose cost for the May-October period is an average of USD 3.29 per million BTU (British unit of measurement for gas).
N1 (high income) users will pay an average of USD 3.29 per million BTU. However, it is estimated that the price of gas in winter is around USD 5 per million BTU, so they will continue to be subsidized.
N2 users will have a 64% bonus on the price paid by high-income users, that is, they will cover USD 1.18 per million BTU. Until April they paid USD 0.8 per million BTU, so they will pay almost 55% more for gas.
The N3 residential areas will have a 55% bonus on the PIST, so they will only pay almost USD 1.81 per million BTU. Until April they paid USD 1.1 per million BTU, which implies an increase of 64% in that concept.
The resolution unifies the consumption limits for low and medium income users at 41 cubic meters per month: “During the Transition Period, from June 1 to November 30, 2024, for natural gas consumption by network , the consumption limits established for Level 3 users in Resolution No. 686 dated October 5, 2022 of the Energy Secretariat of the Ministry of Economy (“base consumption”) are extended to users included in Level 2. “Consumptions made above ‘base consumption’ will be considered ‘excess consumption’ for the purposes of the bonus to be applied to the Energy component that will be transferred to the rates.” It is worth remembering that the surplus will be paid without a subsidy, that is, USD 3.29 per million BTU.
To illustrate the final bills, the Ministry of Energy made an estimate of increases considering average residential consumption: N1, with an average consumption of 149 m3, will go from $25,756 to $28,142 (9%). N3, with an average consumption of 171 m3, will go from $24,465 to $26,865 (9%). N2, with an average consumption of 159 m3, will go from $15,638 to $20,797 (32%).
