Argentina’s biggest electricity distributor eyeing energy storage opportunities

Argentina’s biggest electricity distributor, Buenos Aires company Edenor, said it was looking at energy transition opportunities in non-regulated business areas.

These include energy storage, power generation and critical minerals, the company’s 4Q24 results call was told.

An associated subsidiary was formed for this purpose.

In terms of power, Argentina’s government has launched a 500MW battery storage tender for Buenos Aires province. So far, at least two generators have announced interest in the process, designed to bolster the creaking grid in the province, where outages are not uncommon during high demand periods. 

Also, a thermoelectric supply auction could get underway this half. Growth in renewables capacity, is being driven by the Mater term market.

Argentina’s government recently announced a market reform that could spark investment in new plants, BNamericas was told recently. One change partially reinstates the market – inactive until now – for corporate power purchase agreements involving thermal, hydro, and nuclear power generation facilities.

An associated resolution allows generators, traders, and large users to enter into power purchase agreements for new facilities with a commercial operation date on or after January 1, 2025.

Multiple companies have sought the green light over recent months to operate as energy traders.

Capex

Meanwhile, during a recent public hearing on a distribution rate review and an associated proposed hike, Edenor presented a capex plan of roughly US$960mn for 2025-29.

Some 76% in terms of planned outlay is earmarked for expanding supply capacity and the balance renovation of exiting assets. Work areas identified include substations, transformers and smart meters.

Last year Edenor deployed 389bn pesos (US$365mn at current exchange rates), up 45% on 2023.

With around 3.3mn clients, Edenor operates almost 42,000km of network.

In parallel, fellow Buenos Aires distributor Edesur proposed an investment plan of 746bn pesos (US$700mn), which also includes areas such as grid expansion and asset renovation.

Distribution accounts for around 30% of end-users' electricity bills, with generation corresponding to 44%, taxes 24% and transport 2%. Rate resolutions are due by the end of the month.

Argentina suffers from underdeveloped grid infrastructure and transmission and distribution losses, with sector players often pointing the finger at rate freezes and other measures implemented over recent decades.