The Argentine government launched the "Contingency and Forecasting Plan for Critical Months of the 2024-2026 Period" to reduce or mitigate the electricity system crisis caused by a lack of power reserves and to prevent power outages during peak demand. The measures were formalized through Resolution 294/2024 , and as Energía Estratégica anticipated a few days ago ( see article ), the plan includes temporary incentives for the availability of thermal power generators, increased energy exchanges (both temporary and inter-temporary) with neighboring countries (primarily Brazil and Paraguay), accelerated transmission infrastructure projects, a demand management mechanism for large users, and a requirement for distributors to submit a contingency plan. The remuneration scheme for thermal power plants will be in effect from December 2024 to March 2026 and may be extended for an additional 12 months.
It should be clarified that generators wishing to take advantage of this benefit must express their intention to CAMMESA within the next thirty days. Regarding transmission infrastructure, the plan includes promoting investment in system expansions and implementing a comprehensive preventative availability scheme at nodes identified as critical and prone to overload. Furthermore, the National Electricity Regulatory Entity (ENRE) will be required to report on high-voltage and trunk distribution transmission projects with significant progress, in order to create mechanisms that allow for their commissioning as quickly as possible. Finally, the demand management mechanism for Large Consumers (GUMAS) will be voluntary, scheduled, and compensated for those willing to reduce their energy consumption on days with high temperatures, provided their declared maximum requirements exceed 10 MW. Load reduction offers from authorized GUMAS (Local Management Units) must be submitted to the Weekly Schedule, including the proposed reduction relative to the projected demand during the hours of potential availability, the offered price in USD/MWh, and the available hours each day, with a maximum limit of 8 hours per day. The maximum price for the energy associated with each load reduction offer will be USD 350/MWh.
And if the offered and committed power is lower, the price will be reduced, but if the shortfall exceeds 50%, GUMA will be excluded from the bidding list for the remainder of the current week and the following week. Despite these measures, the sector pointed to the lack of prior action by the Executive Branch since it took office last December, as well as to changes in rhetoric, decision-making, and the removal of CAMMESA's powers . "This measure is the complete opposite of what the government said it was going to do."
The problem is what happens if there is a multi-day heat wave that cannot be managed.
That said, the government has no tools because it hasn't done or resolved anything for a year, so it resorts to what CAMMESA knows best," said Paulo Farina, former Undersecretary of Electric Energy, in an interview with Energía Estratégica . "These are incentives that don't change the situation in the slightest."
“The only thing that will work in the moment, as it did when the system was stretched to its limit in the past, will be the orders from the dispatching agency regarding the loads,” he added. With this, the specialist pointed out that so far there has been no indication or modification to encourage new investments in the country's energy sector that would allow it to meet the peak demand of the coming years, especially if demand growth is expected. “The government wants the private sector to carry out public works, but this year it hasn't done so, nor has it faced any obstacles in reforming the transportation system to allow it, for example, under a fee-based system.”
"Perhaps at 500 kV it costs a little more because the investments are larger, but at 132 kV they are smaller," he insisted. "There is a lack of creativity."
It is depressing and shameful that nothing has been done so far.
"In addition, it is incomprehensible that investments in renewables are not being planned, considering their potential and the existing financing available to companies," he stressed.