This Wednesday the Secretary of Energy of the Nation issued a new resolution (No. 93/2024), which replaces the one issued at the end of March, setting the new PIST price per m3 of gas and ordering the Enargas to create a new tariff schedule with its impact on distribution and transportation. It kicks off the gradual removal of subsidies for the country’s middle and lower class.
But this occurs in a context where gas consumption is deepening, with a winter that threatens to be one of the harshest in the last decade. In May there were temperatures that, in some areas of the country, we would have to go back to 2007 to find.
This “advancement” of the coldest season of the year puts pressure on consumption, this consumption puts pressure, via subsidies, on the coffers of the Nation and this imposes the Excel and applies the adjustment for the place that the “spending” reaches, without contemplations.
A study carried out at the time shows that heating is the largest energy consumption in homes, representing more than 40% of the total, followed by hot water, which accounts for around 17%. Last year, average residential gas consumption in the three winter months (June, July and August) exceeded the annual average by almost 20%. In the month of May, due to the harsh temperatures, demand was 30% above the average for this time of year.
Cold Zone: “Natural gas users receive a discount of up to 50%.”
Faced with the lack of sufficient gas, the Government had to buy at the last minute 10 ships of liquefied natural gas to inject into the Escobar terminal, with a high outlay in dollars, which it had not initially contemplated. This banished the “truce” that the Secretary of Energy, Eduardo Rodríguez Chirillo, had anticipated until September for the new Basic Energy Basket (CBE), which would entail the removal of subsidies for the majority of Argentines. In an abrupt decision, the Government set aside the CBE, but moved forward in removing the benefits.
More pressure
The Ministry of Energy confirmed that state assistance to a group of beneficiaries is maintained. And among them the specific regimes such as the Cold Zone and the Social Rate intended for a group of ANSES beneficiaries, which remain in force.
However, the question arises as to what percentage will be applied in the so-called “subsidy” for the Cold Zone. The law that creates it through a Trust Fund says that the discount for reached users will be “up to 50% of consumption spending.” That “up to” transforms 50% into a ceiling and not a fixed percentage.
The Energy resolution established a “bonus” price for the Cold Zone only for N3 users.
In the resolution, when the “excess” price that users N2 and N3 must pay is marked, which is done at full values, a differential value subsidized by the Cold Zone is clarified only for low-income users. A differential that is not made for high-income or middle-class users.
This decision is striking, since the “discount” for the Cold Zone must be made on the total m3 consumed, regardless of the price it has. Is there a new modality coming to apply the benefit?
