In more detail
The most relevant changes introduced by Law No. 32249 are detailed below:
Regarding the commercialization of capacity and energy under power purchase agreements (PPAs)
- Section 3.1 of Law No. 28832 is amended, in order to establish that no generator may contract with free users and distributors, more firm capacity or firm energy than its own and those it has contracted with third parties. Thus, capacity and energy may be contracted separately, benefiting solar and wind generation projects.
Regarding the bids carried out by the distributors
- Distributors may establish their requirements and modalities of supply, which may contemplate the purchase in hourly blocks of energy or capacity and energy, either separately or jointly. Ongoing bids must be adapted to this new provision.
- During the first 12 months from the entry into force of this Law, the bids called by the distributors to supply their regulated users may include the purchase of capacity and energy jointly but only in peak hours.
- Distributors shall publish and update annually a bidding schedule for the next 10 years to cover the supply of their regulated users. Said schedule is binding, however it may be modified with the Regulatory Agency for Investment in Energy and Mining's (OSINERGMIN) prior approval.
- Specific terms are established for the initiation of bids and the term of the PPAs:
- Long-term bids will be initiated at least three years in advance and the PPAs will have a maximum term of 15 years;
- Medium-term tenders will be initiated at least two years in advance and the PPAs will have a maximum term of five years; and
- Short-term tenders will be initiated at least one year in advance and the PPAs will have a maximum term of three years.
- PPAs resulting from these bids will have terms of up to 15 years and firm prices, which cannot be modified without prior authorization from OSINERGMIN.
- Current PPAs may not be extended, nor modified once these provisions enter into force.
Regarding Ancillary Services
- The term "Agents" is modified to include, in addition to generators, transmitters, distributors and free users, "Ancillary Service Providers".
- The definition of "Ancillary Service Providers" is incorporated and includes those who provide the necessary services to ensure the transportation and supply of electricity from generation to demand.
- Ancillary Service Providers must be authorized by the Ministry of Energy and Mines (MINEM), for which the MINEM will adapt the corresponding regulatory framework.
- The term "Ancillary Services" is modified in order to specify that the technological characteristics of the equipment that provide the ancillary services shall be considered. Such modification expressly enables the rendering of ancillary services with equipment different from the generation plants, as is the case of the Energy Storage Systems or BESS.
- It is expressly specified that generators, transmitters, distributors, free users or others may be providers of Ancillary Services.
- It is established that whoever generates the instability of the electric system will be responsible for the payment of the service used.
These modifications related to ancillary services will come into force on 1 January 2026.
Regarding the comparison of the Busbar Price
It is established that the Busbar Price at generation level set by OSINERGMIN may not have a variation of more than 10% of the weighted average of the firm prices of bids and PPAs with free users, in force as of 31 March of each year.
This new reference is applicable only to new PPAs entered into bilaterally or as a result of bids.
Regarding off-grid systems
MINEM may entrust the Committee for the Efficient Operation of the System (COES) with the coordination of the operation of dispatch at minimum cost in off-grid systems where two or more generators operate.
State-owned distributors must execute PPAs for their off-grid systems through bids.
Prohibition to extend or increase quantities of PPAs
Current PPAs may not be extended, and the amounts committed therein may not be increased for any reason.
MINEM and OSINERGMIN have a term of 120 calendar days to adapt the regulations to the modifications contained in this Law.
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We hope this information is of relevance to you and your company. Please do not hesitate to contact us if you require any advice in this regard.
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