Argentina's latest power market rule changes – key pillars and what happens now

Argentina recently announced a series of power market rule changes after initial measures were unveiled earlier in the year and following promulgation of 2024's Ley Bases, known in English as the economic framework, or reform, law. 

The latest move comes amid a push to ease state control over the power industry and spur private sector investment.

A key change stipulates that distributors must source at least 75% of electricity through corporate power purchase agreements. This, in turn, would shrink the role of wholesale power market administrator Cammesa as intermediary. 

Another establishes energy storage players, user-generators and traders as participants in the national electricity market.  

In parallel, officials advanced plans to create a single autonomous regulator, which would unify electricity regulator Enre and gas watchdog Enargas. 

To get a helicopter view of the latest modifications, BNamericas conducted an email interview with Javier Constanzó, an energy, natural resources and infrastructure lawyer at local legal firm Tavarone, Rovelli, Salim & Miani.

BNamericas: Argentina, via decree No. 450/2025, made more changes to the electricity market. Briefly, what are some of the main, or most pertinent changes?

Constanzó: Decree 450 builds on the mandate set forth in the Ley Bases [the so-called omnibus bill passed in June 2024] and the initial policy direction established by emergency decrees 55/2023 and 70/2023, which emphasized the need to foster competition, liberalize the electricity market, rationalize subsidies and ensure economic efficiency in the energy sector.

In particular, the Ley de Bases authorized the national executive to reform the regulatory framework governing the electricity sector – primarily laws No. 15,336 and No. 24,065 – with the aim of ensuring, among other objectives: (i) the free international trade of electric energy; (ii) the liberalization and expansion of electricity markets; (iii) the adjustment of rates to reflect the actual cost of supply, in order to support investment and ensure the continuous and reliable provision of public services; and (iv) the development and modernization of electric power transmission infrastructure.

Pursuant to that framework, the government issued decree 450/2025, which introduces the main significant changes: 

• Reinforcement of federal supremacy: The decree strengthens limitations on provincial and municipal jurisdictions by explicitly mandating that their regulations must not obstruct the federal objectives set forth in the amended laws No. 15,336 and No. 24,065. 
• Mandatory participation in the PPA market: Distribution companies are now required to source at least 75% of their electricity demand through the corporate PPA market. While law No. 24,065 had already recognized the right to enter into private PPAs, such arrangements – for conventional sources – have effectively been suspended since 2013. 
• Transmission expansion mechanisms: The transmission framework is significantly modernized (although in-detail regulation needs to be issued). Expansion may now occur through: (a) obligatory expansion by operators, with associated costs incorporated into the transmission rate – a departure from the previous framework, under which operators were only remunerated for operation and maintenance; and (b) third-party development, allowing market participants to finance and construct new transmission assets either directly or under the public works concession model provided in law No. 17,520 (subject to changes by the Ley Bases with a strong focus on private investment and financing). The promoter may be granted priority of use. These measures align with the government's broader plan to develop backbone transmission infrastructure and to support energy-intensive sectors such as mining.
• Credit enhancement for distribution companies: To address chronic payment arrears and improve the creditworthiness of distribution companies, the decree introduces joint and several liability provisions that extend to the provinces and municipalities to which these companies are concessionaires. This mechanism seeks to ensure greater financial discipline and payment compliance.
• Cost-based rate setting: The decree reaffirms the principle of cost-reflective criteria not only for generation but also for transmission and distribution services, explicitly referencing the need to recover investment and O&M costs, and to ensure economic sustainability across the value chain.
• Clarification on subsidy targeting: Subsidies will be increasingly targeted at vulnerable users, rather than applied broadly across the consumer base. This transition supports fiscal consolidation and sends clearer price signals to industrial and commercial users.
• Incorporation of new market participants: The [wholesale electricity market] WEM is opened to new actors, including: (i) user-generators, or consumers who produce their own electricity; and (ii) energy traders and storage companies. This is particularly relevant in light of the government's ongoing tender for battery energy storage systems (BESS), which seeks to add 500MW of storage capacity to the grid.

BNamericas: It seems that the next phase involves implementation of the reforms. Is that correct?

Constanzó: Yes, the next stage is implementation. Several aspects of the new framework require secondary regulation, public consultation and detailed rulemaking. Decree 450 establishes a 24-month transition period to revise applicable regulations and complementary rules in accordance with the objectives of the new text of laws No. 15,336 and No. 24,065. 

BNamericas: Compared with other reforms of the local power market over the past few decades, how significant or far-reaching is this one?

Constanzó: This is arguably the most far-reaching reform since the 1990s restructuring. Argentina did not have major reforms of the electricity framework since then. Unlike previous adjustments, which were largely reactive or piecemeal, decree 450 sets out a comprehensive and market-oriented overhaul. If sustained, it could structurally transform how the sector operates – regulatory, contractual and financial. However, the most important changes will come from the implementation rules which will be issued through the transition period.

BNamericas: Do you think the overhaul could eventually trigger investment in new projects, such as power plants, storage systems or transmission lines? Or do more parts of the "jigsaw puzzle" need slotting into place, such as access to financing?

Constanzó: We are very optimistic and think that the reforms do create the basis for new investment in new projects. However, further steps are needed to complete the picture – particularly the issuance of detailed implementation rules and maintaining a financing environment that enables long-term capital deployment and financing. Regulatory clarity, predictability and macroeconomic stability will be essential to translate the reform's objectives into actual project development.

BNamericas: Regarding the decree that unifies the two energy regulators and grants them autonomy, how do you think the private sector will view this change? On the surface, it seems like it would boost certainty.

Constanzó: The unification and formal autonomy of the electricity and gas regulators (Enre and Enargas) was mandated by the Ley Bases. In principle, this move should enhance regulatory certainty and independence, which the private sector has long called for. It should also help streamline the functioning of the gas and electricity markets which are closely intertwined. The effectiveness of the change, however, will depend on how autonomy is exercised in practice – particularly regarding technical capacity, institutional safeguards and insulation from political cycles.