Energy Central Professional


Industry, the productive sector most affected by the electricity hike

CE Noticias Financieras  


    Prior to the start of the public hearings, the National Energy Regulatory Entity ( ENRE) authorized an increase of up to 73% in electricity rates for industries supplied by Edenor and Edesur, as published this Tuesday in the Official Gazette. The private sector warned that the increase in energy will add pressure to prices, but the Energy Secretariat maintains that in most of the productive sectors the weight of electricity in the total cost structure is low.

    In any case, the most affected will be those sectors that are intensive in electricity consumption, mainly industry, which consumes an average of more than 2,000 megawatts.

    Last year, the demand for electrical energy throughout the national territory reached the highest historical level in 2021, with 133,800 gigawatts/hour, driven by the consumption of the industrial sector, which, with 12.3 percent; more than doubled the overall increase, according to the Foundation for Electrical Development (Fundelec).

    Large and small consumers

    The increases will be 58 percent for low voltage, 67 percent for medium voltage and 73 percent for high voltage. With the new tables, large consumers will pay an average power price of 13,675 pesos for each megawatt per hour (MWh) consumed, according to estimates by the specialized website Econojournal.

    The differentiation between households and industries had already been implemented last year. In 2022, the segmentation of residential tariffs will move forward, but the wholesale demand, known in the jargon as large users, who purchase electricity directly in the wholesale market, was defined by resolution.

    Forty-two percent of energy consumption corresponds to residential demand. The average residential consumption is 6077 MW, the intermediate consumption (commercial and small industries) is 4269 MW and the large consumption (industrial) is 4284 MW.

    The electricity distributors maintain that the tariff increase for some industrial users is exclusively to pay part of the cost of producing and transporting energy, a concept that the companies transfer to the invoices and pay with the proceeds to the Wholesale Electricity Market Administration Company (Cammesa).

    A more vigorous growth

    Since November 2020 with the progressive enabling of activities after the isolation measures before the arrival of Covid-19 , an increase in the large demand was observed, consolidating that increase in 2021 in general in all activities: "In this 2022, the large demand is located in similar values, or even somewhat higher in some activities, compared to 2021".

    "Today the large demand reached 115 percent of the pre-quarantine situation (i.e., it is above that moment)," according to the latest Cammesa report. The large demand started to increase its consumption since the last days of April 2020, starting from values of around 60 percent of the pre-pandemic consumption.

    "The industrial branch is the one that continues to drive the growths and largely explains the variation in the large demand, while in the food, commerce and services and oil and minerals branches, although they also present increases in their consumption, in general these are still somewhat low compared to the first days of the quarantine," said the April report.

    If we observe by activity, in the short term the activities that drive the growth of the industry are those related to metallic products (with the exception of the automotive sector), construction companies and industries related to chemicals, rubber, plastics and other non-metallic mineral materials.

    Consumption by category and segment

    In average values, small consumption (residential, demand linked to a lesser or greater extent to temperature), showed a decrease in demand. Intermediate consumption (commercial/small industry) showed a positive variation, while large demand (large industry - demand linked to economic activity), "showed practically no variations" in the last twelve months, according to Cammesa's report.

    The consumption by category, at national level, estimated by average megawatt (MW) per hour, according to Cammesa's latest report is as follows:

    (a) Food, commerce and services (Total: 424.4 MW).

    -Freight and ports: 7.7 MW

    -Commerce and services: 26.8 MW

    -Food industry: 304.8 MW

    -Public services and transportation sector 85.1 MW

    b) Industries (Total: 1474.2 MW)

    -Automotive: 39.7 MW

    -Petroleum products: 201.8 MW

    -Construction industry: 186.4 MW

    -Wood and paper: 113.1 MW

    -Non-automotive metals: 464.9 MW

    -Textile industry: 67.6 MW

    -Rubber chemicals, plastics: 400.7 MW

    c) Petroleum and minerals (Total: 208.6 MW)

    -Mineral extraction: 17.8 MW

    -Oil extraction: 190.8 MW

    Greater Buenos Aires and the Province, areas of influence of Edenor and Edesur mainly, account for 26 and 21 percent, respectively, of the electricity demand.


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