The national government approved increases in the wholesale prices of electricity and gas, and defined new ceilings from which the middle and low income sectors will pay the full rate. In the case of electricity, the new scheme implies an increase of 22.8% in June for the high-income sector; 155.8% for middle-income sectors; and 99% for low-income sectors. On gas bills, a level 1 (high) user will pay 9.2% more; a level 3 (medium) user, 10%; and a level 2 (low) user, 33%.
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In one of the resolutions, the organization authorized a increase in the wholesale price of electricity, which in the months of June and July will cost $57,214 MWh (a unit of measurement used in the wholesale electricity market). This value – as officially reported – represents 80% of the real value of energy generation ($71,411).
At the same time, in another resolution limits were established for low-income users (level 2 of the current segmentation scheme) and middle income (level 3). The former will receive a 71.92% bonus on the wholesale price of energy (that is, they will pay $16,066 per MWh), while the latter will have a 55.94% discount (they will pay $25,208). The differences will continue to be made up by the Government through subsidies.
Level 1 (high income) will not receive extra bonusesbut they will benefit from the general subsidy, so they will pay the 80% of the real value of the cost of electricity. While, level 2 will pay 22.5% and level 3, 35.3% of the cost. Until last month, the middle and lower sectors paid less than 5% of the generation cost.
In another important modification to the current subsidy scheme, the Government also established new limits for subsidized energy at levels 2 and 3. Low-income sectors, which until now did not have limits, will be subsidized up to 350 KWh per month.
Meanwhile, middle-income sectors will have a subsidy limit of 250 KWh (previously it was 400 KWh). All consumption above these limits will have an extra cost of 356% for level 2 and 227% for level 3.
How does this new scheme impact the final user rate?
The price of electricity is made up of 3 segments: the cost of generation (managed by the wholesale company Cammesa); that of transportation and Distribution Value Added (VAD).
With the changes, the national government only increased the value of the first segment, while continuing to postpone the other 2, despite the fact that last April it had announced a system of monthly increases, in line with inflation, and a new system of subsidies only for low-income sectors, which was postponed until November.
According to calculations by the National Energy Secretariat, the new scheme implies an increase of 22.8% in June for the high-income sector; 155.8% for middle-income sectors; and 99% for low-income sectors.
According to the national government, users who reside in cold areas or those who receive the social rate will maintain the benefits, it publishes. Checked.
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June 2024 increases in natural gas rates
In the case of gas, the Government increased the price at the Entry Point to the Transportation System (the wholesale cost paid by distributors) by US$ 3.3 per million BTU (the measure used in the sector) on average. In the original official plan the wholesale price should have reached US$ 4.49 per million BTU (36% more).
As with electricity, the Ministry of Energy established differential prices for levels 2 and 3, and left those in level 1 without a bonus (that is, they will pay the full price of the fare).
For the sectors of low income, the bonus will be 64% (that is, they will pay US$ 1.18 per million BTU), while the average income will have a 55% discount (they will pay US$ 1.48).
Meanwhile, a cap on subsidized consumption was established for low-income sectors, in line with that already applied to the middle sectors that depend on the distribution company. According to official data, with these changes a level 1 user would pay 9.2% more; a level 3 user, 10%; and a user at level 2.33%.
