Translation provided by JIGGSLAW®. At the start of last week, statements made by Walter Martello, controller of Argentina’s National Electricity Regulatory Authority (ENRE in Spanish), against granting a power distribution service concession agreement to Edesur, the power operator owned by the Italian ENEL, triggered all alarms within the company in the face of a potential new investment arbitration.
On February 13, 2023, the Secretary for Economy, Flavia Royon, was blunt on her Twitter account when she stated that “we are not going to doubt if that implies to terminate the electric distribution services concession contract of EDESUR.
Following the situation that prompted intervention talks (see “Edesur ve en su posible estatización la luz verde para hacer un nuevo juicio ante el Ciadi,” Fabián Quintá, Perfil, 18.022023), Argentina’s government reversed its intention, and three days later, Argentina’s Minister for Economy Sergio Massa confirmed, also on Twitter, the million-peso fine imposed on the company. “I have entrusted the enforcement of the million-peso fine against Endesur for service problems to the Secretary of @Energia_Ar and the Regulatory Authority.”
Following the meeting with Argentina’s government, the company stated in a press release that it has no intention of intervening in or changing Edesur’s operations or assets (see “Gobierno vs. Edesur: la empresa celebra que “no tienen intención de intervenir””, Clarín, 16.02.2023).
The conflict arose from power outages caused by Edesur to consumers under a power service contract signed 30 years ago in Buenos Aires’ south and surrounding areas.
Claudio Cunha, ENEL Argentina’s country manager, stated in a press release that the solution to the power outages “due to historical demand” and “requires companies to have access to enough resources to operate, maintain, and make the investments that the system requires […].” see “El Gobierno y Edesur afirman que no habrá intervención ni expropiación”, María Julieta Rumi, (pressreader) La Nación, 17.02.2023).
Finalmente, el Gobierno argentino optó por instaurar un observador que monitoree la actividad de la empresa.
Finally, the Argentinian government opted to appoint an observer to oversee the business activity.