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Argentina: Electricity Companies Face Severe Fines for Blackouts

By: PanAm Post Staff - Jan 7, 2014, 4:54 pm

EspañolThe two electricity companies that dominate the Argentinean market — Edesur, of Italian owners, and Edenor, of domestic owners — will have to pay network users AR$221 million (US$33.5 million) and AR$77 million (US$11.7 million), respectively, for blackouts under their watch.

The payments will constitute initial compensation to those users from Buenos Aires and Capital Federal who were impacted by the blackouts. They occurred during December, left them without light, and resulted in widespread difficulties.

Power shortages stemmed from a lack of infrastructure investment, which in the heat of summer wasn’t able to match the high energy demand. The distributors responded to the penalty by saying that low electricity rates in the country — coupled with increasingly high inflation — have made it impossible to finance the investments needed to improve the flow of energy.

Meanwhile, Argentinean Planning Minister Julio De Vido said that the penalties could be higher and the companies could even lose their service concession, given the breach of the contract.

Source: Infolatam.