The Government has been in office for two and a half months;
but it still does not have a budget for expenses and resources for 2024;
and its legislative failures have been spectacular.
The Omnibus Law – one of the most extensive laws in history – failed miserably on the 2nd day of its treatment in Congress.
DNU 70 of 350 articles is current, but it hangs by a thin thread.
From the republican point of view, the Government is weak;
and also lacks a coherent, well-explained Program, which prevents political agreements.
Poverty has grown to levels never seen before;
and inflation has increased;
salaries and pensions are behind;
and there is no contingency plan to alleviate the devastating effects on the most dispossessed
This lack of program is general;
but it is clearly seen in the energy sector;
because it affects everyone.
The problems are of extraordinary complexity but the solutions are not yet programmed.
Milei in many cases repeats the formulas of Kirchnerism.
We will describe three of those problems that show the high improvisation of the administration:
1) The President is a confessed denier of the anthropogenic causes of climate change, which is today humanity's main energy problem.
This attitude - until now personal - will define the energy policy of his government.
It would be a major incongruity for a denier to implement an active energy policy to mitigate climate change;
especially when the latter involves large investments to replace the current matrix based on hydrocarbon consumption.
If this conceptual inconsistency is not corrected, Argentina will face problems.
2) The Government is preparing to adopt a policy of price adjustments in all areas of the energy matrix;
replacing the extraordinary inherited subsidies that total some 148 billion U$S in the last 15 years.
It's easy to say;
but its execution is difficult for a government without a program.
The problem is serious, but the Milei government has not yet analyzed the cost structure of energy producers.
It is inadmissible that a government headed by an economist has validated these corporate-based prices without having taken into account the nonexistence of a transparent and competitive energy market;
Naivety or complicity?
The President and his Secretary of Energy have very meekly accepted the prices agreed upon between the public officials of the previous government and the corporations, without ever having carried out cost audits.
I cite two examples that should be investigated: the “criollo barrel” applied as a support price when the international price of oil falls has not been eliminated from the roots And the great disparity between gas prices at the wellhead between Argentina and the world;
It should have been studied and corrected in favor of Argentine consumers.
The price of natural gas has the greatest impact on the formation of prices of all energy.
3) The continuity with the policy of Kirchnerism is striking when the lack of definition regarding the future of the hydroelectric plants owned by the national State whose concessions began to expire in 2023 continues. The Government has not yet adopted a definition consisting of reversion to the national State of said plants as established in the respective contracts signed 30 years ago.
In this last case, the indefinitions reveal the Government's programmatic deficiencies.
The governors of the provinces of Neuquén and Rio Negro have intimated the Nation through “Document Letters” in which they demand that the Government “refrain from making any type of decision or measure regarding the dams without first giving participation to the provinces.” ”.
It is logical that both provinces demand prior information from the Nation regarding the future of the dams -El Chocón;
Banderita Plain;
Alicurá and Piedra del Águila - which are located in the territory of both provinces and the original domain of the water resources used by them to generate energy corresponds to the provinces.
But there is something that must be made clear: the owner of the hydroelectric plants in question is the Argentine Nation and not the provinces in which the plants are located.
These plants were built by the Nation – through the company Hidronor;
The Nation financed the works with credits from the IDB and World Banks and also by Argentine users through the Specific Funds created by national law for such purposes.
These plants were also built for use of the 500 KV National Interconnected System, which includes the construction of the Transmission Systems that link Comahue with the entirety of Argentina.
In summary, I think it would be important for the Government to make an orderly effort to explain its energy policy for the next four years.