Reform of the Electricity and Natural Gas Regulatory Framework

On July 7, 2025, the National Executive Branch issued the following decrees:

1. Decree No. 450/2025, which introduces amendments to Law No. 15,336 and Law No. 24,065 (the latter through a new consolidated text), both of which govern the electricity sector.
   
   
2. Decree No. 451/2025, which amends Law No. 24,076 on natural gas through a new consolidated text.
   
3. Decree No. 452/2025, which establishes the National Regulatory Entity for Gas and Electricity.

Below is a summary of the most relevant aspects of these reforms:

1. Decree No. 450/2025 – Amendments to Electricity Laws

Exercising the powers delegated by Article 162 of the Ley de Bases (Law No. 27,742), the National Executive Branch issued Decree No. 450/2025 (“Decree 450“), which introduces amendments to Laws No. 15,336 and 24,065. According to the explanatory recitals, the amendments aim to reduce the National Government’s involvement in the electricity pricing and contracting system, in order to provide greater freedom to private actors within a modernized and appropriate regulatory framework.

In particular, Decree 450:

1. Approves the “Amendments to Law No. 15,336,” summarized below.
   
   
2. Approves the amendments and new consolidated text of Law No. 24,065, also summarized below.
   
   
3. Establishes a 24-month transition period from the effective date of the decree for the amendment of related regulations and supplementary rules. During this period, the Secretariat of Energy must undertake all necessary actions to ensure a gradual, orderly, and predictable transition toward the objectives set forth in Article 2 of Law No. 24,065 and the full implementation of Decree 450 and its regulations.
   
4. Provides that during the transition period, the Secretariat of Energy must enact regulations to:
   
   1. Promote the vertical, horizontal, and inter-sectoral deconcentration of the hydrocarbons market, enabling free contracting of fuel by electricity producers.
   2. Ensure the effectiveness of guarantee measures intended to normalize collections and ensure the collectability of contracts with electricity distributors.
   3. Establish remuneration criteria for thermal generation that enhance efficiency in the procurement of natural gas (NG), liquefied natural gas (LNG), gas oil (GO), and fuel oil.
   4. Implement progressive mechanisms for the transfer of power purchase agreements entered into by CAMMESA on behalf of the Wholesale Electricity Market (MEM) demand to distribution companies and large users of the MEM.
   5. Implement mechanisms for the transfer to MEM supply of fuel purchase agreements entered into by CAMMESA.
   6. Review all regulations comprising “The Procedures” approved by Resolution SEE No. 61/1992 and issued during the emergency period, in order to determine their repeal or establish a maximum validity during the transition period.

A. Amendments to Law No. 15,336

Key changes include:

1. The inclusion of electricity “commercialization” as an activity governed by the law.
   
   
2. The purchase and sale of electricity will be deemed a civil and commercial act, subject to applicable laws and regulations issued by the competent authority.
   
   
3. The following will be considered inconsistent with the objectives of federal legislation and the free circulation of electricity:
   1. Any local tax, even if established under the denomination of a service fee, insofar as it does not compensate for services effectively, concretely, and individually rendered, or exceeds the specific cost of the service actually provided. A fee shall be considered to exceed the specific cost of the service actually provided when its taxable base is determined not on the basis of such cost but rather on sales, gross income, profits, or similar parameters.
   2. Any act or regulation of the local granting authority that impedes or restricts: (i) the pass-through of the cost of electricity acquisition in the Wholesale Electricity Market (MEM) to the tariffs charged to end-users of local providers of the Public Distribution Service, insofar as such cost is transferable to the tariff under federal regulations; (ii) the payment of debts of such providers payable through the Dispatch Responsible Entity (OED, currently CAMMESA); or (iii) the economic and financial self-sufficiency of the electricity market as established in Article 2 of Law No. 24,065.
      
      
4. Hydroelectric concessions must be granted for a fixed term not exceeding 60 years. Upon termination for any reason under the concession agreement, the Federal Government must conduct a public tender process (both domestic and international) for the new concession.
   
   
5. Modifications are introduced regarding the functions and composition of the Electricity Council and the structure and administration of the National Electricity Fund. A new subsidiary fund is created to support regional tariff compensation for end-users.

B. Amendments to Law No. 24,065

Key updates to the consolidated text of Law No. 24,065 include:

1. Free Users: The concept of “free users” is incorporated into the MEM. The regulation will define their energy and capacity thresholds and other technical characteristics.
   
    
2. MEM: The law recognizes the participation in the MEM of (i) regulated self-generators under Law No. 27,424 and others authorized under federal regulations; and (ii) entities identified in the regulations, including marketers and storage operators.
   
   
3. Term Market: Regulations must guarantee maximum competition and freedom of contract for electricity generators. Term contracts are considered essential to achieving national policy objectives and ensuring energy supply. Any local measure that impedes, hinders, or increases the cost of such contracts is deemed to interfere with those goals.
   
   
4. Storage Operators: The law introduces the role of energy storage operators—owners of energy storage facilities dispatched as generators. These operators may buy and sell energy in the electricity market under conditions set by the Secretariat of Energy and within the limitations established in Chapter VII of Law No. 24,065.
   
   Energy storage in the electrical system is understood as commercially available technology capable of absorbing energy, retaining it for a period of time, and subsequently delivering it back to the system. The regulation must seek the optimal utilization of the storage potential to provide services to the system and ensure the proper functioning of the market, establishing criteria for the identification of such services and the necessary technical resources.
   
   
5. Distribution Contracts: Distributors must purchase at least 75% of the energy required to supply end-users through the term market. The parties to such contracts may request the publication of the weighted average price along with the stabilized price.
   
   
6. Essential Works: If a transmission project not included in the current concessions is deemed technically and economically essential for the corresponding public service needs within the SADI (Argentine Interconnection System), the Secretariat of Energy may, after consulting CAMMESA, order its inclusion. The economic and financial conditions related to the expansion obligation may not affect the normal operation of the concession. The National Regulatory Entity for Gas and Electricity will follow standard procedures to authorize the work, determine its financing method, and, if applicable, incorporate the cost recovery amount into the relevant tariff schedule. The work must be contracted through open, competitive, and auditable procedures.
   
   
7. Private Lines: Provided that it does not affect competition conditions in the Wholesale Electricity Market (MEM), the National Executive Branch may authorize a generator, distributor, and/or large user to build, at their exclusive cost and to satisfy their own needs, a line and/or expansion of the transmission network, for which regulations shall be issued determining the modalities, characteristics, priority of use, technical requirements, operating methods, and other conditions to obtain the authorization. In such cases, the authorized facilities shall not provide a public transmission service.
   
   
8. Network Expansions: SADI expansions may be carried out at the risk of the developer under regulatory guidelines. The regulations must provide alternative expansion mechanisms, including those under Law No. 17,520 and its amendments.
   
   
9. Import/Export: The Secretariat of Energy must establish transparent, efficient procedures for MEM participants to exercise the right to import/export electricity. Objections may only be raised on technical or economic grounds related to supply security.
   
   
10. Distribution Tariffs: In the case of distributor tariffs, the sale price of electricity to users shall include a component representative of the costs of acquiring electricity in the Wholesale Electricity Market (MEM). The cost of electricity acquisition in the MEM shall consider: (i) the price of the distributor’s purchases in the spot market and the weighted average of purchases made through Term Market contracts in competitive processes in accordance with the regulation to be issued by the Secretariat of Energy regarding contracting conditions; (ii) the cost of high-voltage transmission; and (iii) the system services administered by the Dispatch Responsible Entity (OED). The different components shall be itemized on the user’s invoice, which may not include local taxes or charges unrelated to the goods and services invoiced; and
    
    Tariffs shall ensure the minimum reasonable cost for users that is compatible with the security of supply.
    
    
11. Fines: Updated fines for violations committed by non-concessionaire third parties now range from ARS 130,000 to ARS 140,000,000 and the regulatory entity may adjust these amounts to reflect industry conditions.
    
    
12. Liability of Provinces, Municipality, and the Autonomous City of Buenos Aires: In the event that, as a consequence of any jurisdiction’s failure to comply with the terms of its adherence to Law No. 24,065: (i) the distributor defaults on fulfilling its payment obligations in the Wholesale Electricity Market (MEM), payable through the Dispatch Responsible Entity (OED); and/or (ii) the operation of the MEM is affected, the Provinces, the Autonomous City of Buenos Aires, and Municipalities granting public distribution services to companies, entities, and/or cooperatives operating in the electricity market, as well as the directors of the electrical regulatory entities and/or equivalent supervisory authorities, shall be jointly liable for the payment of debts that such entities, companies, and cooperatives must settle through the OED.

2. Decree No. 451/2025 – Amendments to the Natural Gas Law

Through Decree No. 451/2025, the National Executive Branch approved a new consolidated text of Law No. 24,076 and its amendments. 

The reform primarily updates the references to the sector’s regulatory authorities (i.e., the Secretariat of Energy under the Ministry of Economy and the new National Regulatory Entity for Gas and Electricity), and introduces other formal adjustments.

3. Decree No. 452/2025 – Establishment of the New National Regulatory Entity for Gas and Electricity

Decree No. 452/2025 (“Decree 452”) provides for the creation of the National Regulatory Entity for Gas and Electricity (the “Entity”), pursuant to Article 161 of the Ley de Bases.

The Entity will operate under the Secretariat of Energy and will assume the responsibilities and functions assigned to ENARGAS and ENRE by Laws No. 24,076 and 24,065, respectively.

Key provisions of the decree include:

1. The Entity must become operational within 180 calendar days of the decree’s publication, with a fully appointed Board of Directors.
   
   
2. The Entity will enjoy administrative and budgetary autonomy, functional independence, and full legal capacity to act under public and private law. Its assets will include transferred property and any future acquisitions. It will be headquartered in the City of Buenos Aires.
   
   
3. The Entity will be governed by a five-member Board appointed by the National Executive, with five-year renewable terms. The Secretariat of Energy must initiate the selection process within 30 business days of the decree’s publication.
   
4. In its dealings with individuals and public bodies, the Entity will be governed by the National Administrative Procedures Law No. 19,549, except where expressly superseded by applicable sectoral regulations.
   
   
5. The Chief of Staff is instructed to implement the necessary budgetary adjustments to consolidate the budget programs of ENARGAS and ENRE into the new Entity.
   
   
6. Until the Entity formally approves its organizational structure, the current units of ENARGAS and ENRE will remain in place to ensure continuity in operations and responsibilities.

For any questions or queries, please contact:

• Mariano Luchetti
• Ignacio Minorini Lima
• Juan Zocca
• Manuel Mazza

This is a general comment and in no way presupposes legal advice or opinion. If required, please contact our professionals.