MercoPress. South Atlantic News Agency

Power cuts inevitable in Argentina during next summer

“The Energy Secretariat is working on the issue,” Francos also explained

Argentina's Cabinet Chief Guillermo Francos reckoned there might be scheduled power cuts during the summer despite recent fare adjustments that represented a significant increase for most households. He argued that the measure would be the consequence of the lack of investments in recent years.

“If a very hot summer comes, there may be a very high electricity demand. Unfortunately, there have been no investments, there will be a lack of generation and we will have to schedule some cuts, especially to make some agreements with the industrial sectors,” Francos said in a radio interview.

According to weather forecasts, Argentina is up for an extremely hot summer which would prompt an increase in electricity demand that would most likely exceed supply, and therefore outages will be needed.

“It is a situation that has been going on for years and that needs to be seriously addressed. I believe that investments must be made, of course. And eventualities must be faced, one cannot be subject to improvisation,” Francos pointed out.

He also explained that the fare increases were a result of cutting subsidies. “Otherwise the cost has to be paid by the State,” he stressed. “The cost of operation must always be paid, if there is no reasonable generation, nobody can be asked for investment. The State's policy is to end subsidies so as not to generate debt, emission, and inflation,” he went on.

“The Energy Secretariat is working on the issue,” Francos also explained.

Earlier this month, Energy Secretary Daniel González Casartelli admitted that there would be difficulties in energy matters. “It is going to be a complicated summer,” he warned. “We have restrictions in the electricity sector, especially in transmission; it is going to be a complicated summer.”

According to González Casartelli, energy generation will hinge on “the temperatures and the water situation” and for that “mitigation measures” were already being considered. However, permanent solutions would “take time.”

In his opinion, “the main destruction of the energy sector has been the macroeconomic situation and the dollar restriction, but the Government is trying to solve the underlying problems and not to sell colored mirrors of giving privileges when there are no dollars.”

“I am optimistic that they are working on the basic measures and we will be able to achieve the full potential of Vaca Muerta,” explained the former CEO of YPF during Mauricio Macri's administration.