Argentina’s electricity sector is undergoing significant reforms under the current administration, which took office in December 2023. The government has taken a series of measures to deregulate the sector and promote private investment to address the sector’s challenges, that have been exacerbated by years of under-investment in grid infrastructure and slow growth in generation capacity compared to the rising demand, leading to frequent supply disruptions.

The latest structural reforms were brought about in July 2025 by Decree 450/2025, which amends key provisions in power sector Laws 15,336 (Régimen de Energía Eléctrica or Electric Energy Regime) and 24,065 (Marco Regulatorio Eléctrico or Electric Regulatory Framework); and Decree 451/2025, which establishes a single energy sector regulator for electricity and gas (Regulador Nacional de Gas y Electricidad [RNGE]), assuming the roles of electricity and gas regulators – Ente Nacional Regulador de la Electricidad (ENRE) and Ente Nacional Regulador del Gas (ENARGAS). The new entity will be finalised over a 180-day transition period. Previously, in April 2025, through Decree 286/2025, the government initiated the privatisation of Energía Argentina S.A. (Enarsa), beginning with the divestment of Enarsa’s stake in the country’s main transmission company, Compañía de Transporte de Energía Eléctrica en Alta Tensión Transener S.A. (Transener).

These measures build on the policy direction established through emergency Decrees 55/2023 and 70/2023, and subsequently the Law 27,742 or the Ley de Bases y Puntos de Partida para la Libertad de los Argentinos (Ley Bases) (the July 2024 omnibus law). The aim is to foster competition, liberalise the electricity market, rationalise subsidies and ensure economic efficiency in the energy sector.

The key changes brought about by Decree 450/2025 are as follows:

  • It authorises the complete opening of electricity to international trade, with clear and predictable rules. The government may only object to transactions for technical reasons or security of supply concerns.
  • It reestablishes and strengthens the possibility of entering into sales contracts between private parties, reversing the provisions of 2013, to promote predictability, stable supply and long-term investments. Particularly, distribution companies need to source at least three quarters of their demand through the corporate power purchase agreement (PPA) market. While Law 24,065 allowed private PPAs, such arrangements for conventional sources were effectively suspended since 2013. This implies that distribution companies and large consumers will be required to procure electricity directly from the wholesale market – bypassing the current centralised mechanism managed by Argentine state-owned wholesale electricity company, Compania Administradora del Mercado Mayorista Electrico SA (CAMMESA), which manages the Mercado Eléctrico Mayorista (MEM) or wholesale electricity market (WEM) and coordinates the technical and economic aspects of the Sistema Argentino de Interconexión (SADI) or Argentine Interconnection System.
  • It ratifies the free choice of supplier by end users by ensuring that consumers can decide with whom to contract their energy, without regulatory obstacles or operational hurdles. Additionally, subsidies will increasingly focus on vulnerable users instead of being applied across the entire consumer base. This transition supports fiscal consolidation and provides clearer price signals to industrial and commercial users.
  • To tackle persistent payment arrears and enhance the creditworthiness of distribution companies, the decree introduces joint and several liability provisions that also apply to the provinces and municipalities served by these companies. This approach aims to promote better financial discipline and ensure that payments are made on time.
  • It introduces regulatory mechanisms to make users aware of what they are paying. Their bills may not include local taxes or charges unrelated to the goods and services billed. There will be cost-based rate setting for transmission and distribution services to ensure the recovery of investment and operation and maintenance (O&M) costs, as well as economic sustainability across the value chain.
  • It establishes multiple alternatives for private infrastructure initiatives in transmission projects that must maintain open, non-discriminatory access, but can proceed under risk-based investment models, which include cost recovery mechanisms. A detailed regulation is expected to be issued in this regard. Broadly, transmission expansion can take place through mandatory expansion by operators, with associated costs included in the transmission rate – a shift from the previous framework, where operators were only compensated for O&M; and third-party development which permits private players to finance and build transmission assets either directly or through the public works concession model set by Law 17,520. This is subject to changes by the Ley Bases. The developer may be granted priority of use. These measures are in line with the government’s plan to develop backbone transmission infrastructure and support energy-intensive sectors such as mining.

In late May 2025, the Argentine government presented a list of priority projects to be financed and executed by private companies through a concession scheme at no cost to the government. These projects, aggregating 5,610 km of new lines at an investment of USD6.6 billion, would strengthen SADI and mitigate outages. Private developers can recover the investment through the payment of a fee by the users who benefit from this new infrastructure.

  • The WEM is now open to new participants, including consumers who produce their own electricity as well as energy traders and storage companies. This is significant in relation to the government’s ongoing tender for battery storage systems, which aims to add 500 MW of storage capacity to the grid. The tender received an overwhelming response of over 1.35 GW from 14 companies, with the final awards expected by the end of August 2025.
  • The decree reinforces federal authority by strengthening limitations on provincial and municipal jurisdictions by mandating that their regulations must not obstruct the federal objectives outlined in the amended laws 15,336 and 24,065.

The decree establishes a 24-month transition period during which all complementary regulations must be adapted and a gradual, orderly, and predictable implementation of this transformation must be guaranteed. This will be in coordination with the MEM normalisation process being carried out by the Energy Secretariat (SE) of the Ministry of Economy. In January 2025, the SE introduced Resolution 21/2025 to implement changes in the WEM regarding fuel management for thermal generators, as well as price determination and the operation of both the corporate PPA and the spot markets.

Net, net, the government intends to transform the Argentine electricity sector into an industry driven by private investment, economic and financial self-sufficiency, market signals, and freedom of choice.