Energy Industry on High Alert as Government Delays Payments, Sparking Concerns over Default and Supply Risks

Amidst a crisis, the former official of Mauricio Macri cautioned clients to be vigilant and expect delays in public spending. He questioned whether the government would prioritize paying retirees or energy companies when faced with limited funds. The debt for electricity subsidies, which was expanded in early 2024, has caused tension between the government and energy companies. The debt owed to electricity generators amounts to around $1.3 billion, while gas producers are owed an additional $900 million.

The delay in payments from the government has raised concerns about legal security and supply risks for heavily leveraged companies like Central Puerto, Pampa Energía, YPF Luz, and others. These companies have loans from international banks that have led to a delay in their payments. The lack of payment has led to fears of default on debt by these companies, as well as supply risks due to delayed payments.

Two major players in the sector, Pampa Energy and AES, have expressed concerns about the government’s default on payments. They sent statements to the National Securities Commission to clarify their situations and debts. Both companies insist they currently have no financial problems but warn that prolonged delays in payments could impact their operations.

Cammesa, a company with equal ownership between the Ministry of Energy, generators, transporters, distributors, and users, acts as a financial intermediary in the energy market. The decision to stop paying subsidies to achieve fiscal surplus has caused debts to accumulate and tensions in the sector. The Renovador Front and General Confederation of Labor have raised concerns about the lack of real surplus in public spending due to unpaid energy subsidies. They argue that if these subsidies had been paid, public spending would have increased significantly in the sector.

In conclusion, the delay in payments from the government to energy companies has raised concerns about legal security