Power Generation, Transmission and Distribution 2025

Definitive global law guides offering comparative analysis from top-ranked lawyers

CHAMBERS GLOBAL PRACTICE GUIDES

Power Generation Transmission & Distribution 2025 Definitive global law guides offering comparative analysis from top-ranked lawyers

Contributing Editor David P. Flynn Phillips Lytle LLP

Global Practice Guides

Power Generation Transmission & Distribution

Contributing Editor David P. Flynn Phillips Lytle LLP

2025

Chambers Global Practice Guides For more than 20 years, Chambers Global Guides have ranked lawyers and law firms across the world. Chambers now offer clients a new series of Global Practice Guides, which contain practical guidance on doing legal business in key jurisdictions. We use our knowledge of the world’s best lawyers to select leading law firms in each jurisdiction to write the ‘Law & Practice’ sections. In addition, the ‘Trends & Developments’ sections analyse trends and developments in local legal markets. Disclaimer: The information in this guide is provided for general reference only, not as specific legal advice. Views expressed by the authors are not necessarily the views of the law firms in which they practise. For specific legal advice, a lawyer should be consulted. Content Management Director Claire Oxborrow Content Manager Jonathan Mendelowitz Senior Content Reviewers Sally McGonigal, Ethne Withers, Deborah Sinclair and Stephen Dinkeldein Content Reviewers Vivienne Button, Lawrence Garrett, Sean Marshall, Marianne Page, Heather Palomino and Adrian Ciechacki Content Coordination Manager Nancy Laidler Senior Content Coordinators Carla Cagnina and Delicia Tasinda Content Coordinator Hannah Leinmüller Head of Production Jasper John Production Coordinator Genevieve Sibayan

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Contents

INTRODUCTION Contributed by David P. Flynn, Phillips Lytle LLP p.4 ARGENTINA Law and Practice p.7 Contributed by Pozo Gowland Abogados BANGLADESH Trends and Developments p.30 Contributed by Farooq & Associates BRAZIL Law and Practice p.36 Contributed by Tauil & Chequer Advogados in association with Mayer Brown

NORWAY Law and Practice p.205 Contributed by Advokatfirmaet Haavind AS Trends and Developments p.226 Contributed by Advokatfirmaet Haavind AS

PAKISTAN Law and Practice p.235 Contributed by RIAA Barker Gillette

PHILIPPINES Law and Practice p.259 Contributed by Puno Law

UK Law and Practice p.274 Contributed by King & Spalding International LLP Trends and Developments p.298 Contributed by King & Spalding International LLP

Trends and Developments p.61 Contributed by Advocacia Bettiol

GREECE Law and Practice p.69

Contributed by Koutalidis Law Firm Trends and Developments p.92 Contributed by Koutalidis Law Firm INDONESIA Law and Practice p.101 Contributed by ABNR Counsellors at Law Trends and Developments p.114 Contributed by ABNR Counsellors at Law JAPAN Law and Practice p.117 Contributed by Nagashima Ohno & Tsunematsu Trends and Developments p.145 Contributed by Mori Hamada & Matsumoto

USA Law and Practice p.307 Contributed by Phillips Lytle LLP USA – CALIFORNIA Law and Practice p.328 Contributed by Buchalter Trends and Developments p.353 Contributed by Buchalter

USA – TEXAS Trends and Developments p.361 Contributed by Troutman Pepper Locke USA – WASHINGTON Trends and Developments p.371 Contributed by Kilpatrick Townsend & Stockton

KENYA Law and Practice p.155 Contributed by EMSI & Associates

MEXICO Law and Practice p.179 Contributed by Cortés Quesada Abogados, S.C. Trends and Developments p.197 Contributed by Cortés Quesada Abogados, S.C.

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INTRODUCTION Contributed by: David P. Flynn, Phillips Lytle LLP Phillips Lytle LLP is a pre-eminent law firm with a fast-paced energy and renewables prac- tice, providing cutting-edge expertise to a wide range of developers, owners, utilities, pipeline and transmission companies, retail energy sup- pliers and financial partners involved in renew- able and other energy projects across New York State and beyond. The firm’s extensive expe- rience and knowledge allows it to complete projects on time and within budget. Phillips Lytle’s areas of energy and renewables exper- tise include siting (such as working with New York’s Office of Renewable Energy Siting and Electric Transmission), zoning and environmen- tal reviews; solar, wind and energy storage pro-

jects; brownfield and landfill renewable energy projects; hydrogen projects; nuclear projects; Public Service Commission (PSC) and regula- tory compliance; incentives; PILOTs, bonds and public finance; power purchase agreements; solar leases; microgrids; hydropower; retail en- ergy industry/ESCO enforcement and investiga- tions; litigation; and dispute resolution. With the increased demand for energy expertise beyond the legal realm, the firm established Phillips Lytle Energy Consulting Services to help navi- gate the complex policies in the energy industry and provide guidance for project development, transactional support, energy policy, regulatory counselling and procurement consulting. storage, hydrogen and wind projects, as well as on the licensing of hydropower projects. David regularly speaks on energy topics across New York State and has strong connections with major energy and energy-related organisations, including the American Council on Renewable Energy (ACORE), the Business Council of New York State, Inc, and Incubators for Collaborating & Leveraging Energy and Nanotechnology (iCLEAN).

Contributing Editor

David P. Flynn is a partner at Phillips Lytle LLP. He is leader of the firm’s environmental law team, co-leader of the firm’s energy and renewables industry team and the cryptocurrency

and blockchain practice team, and a member of the firm’s data centre practice team. With respect to energy, he advises clients on the financing, development and siting of solar,

Phillips Lytle LLP One Canalside 125 Main Street Buffalo New York 14203 USA Tel: +1 716 847 8400 Fax: +1 716 852 6100 Email: info@phillipslytle.com Web: www.phillipslytle.com

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INTRODUCTION Contributed by: David P. Flynn, Phillips Lytle LLP

Transformation in the Power Industry We are pleased to present the Chambers Global Practice Guide for Power Generation, Transmis- sion and Distribution. Much is occurring in this dynamic space. A fundamental transformation of the electric energy and power industry is under way, and a number of things are driving change, growth and innovation. Technological advance- ment, engaged and educated customers, evolv- ing regulatory requirements, economic impacts, and the constant reminder of significant climate change are all driving growth and development in this space. As the market continues to evolve at a fast pace, the legal and regulatory systems are often driv- ing some of these changes; at the same time, these same systems are, in certain instances, forced to play the difficult role of catch-up. That is certainly the case with the power industry. This Guide seeks to inform readers as to what various jurisdictions are doing to drive industry changes, respond to significant market evolution, and fos- ter, encourage and manage the development of their energy resources. While change in the energy sector has always occurred, it has been at a much different pace and scale in recent years. While the primary driv- er in the evolution of this sector was once the unbundling/deregulation of the utility industry, that has clearly changed. Though the unbun- dling of utilities continues, the legal and regu- latory framework in many jurisdictions is also evolving to encourage – if not mandate – new non-carbon sources of electric energy as well as new entrants into the energy generation and transmission market. Every indication is that this will continue, and most likely accelerate, in many jurisdictions.

Legal and Regulatory Frameworks Today, many of the changes in the legal and regulatory frameworks that pertain to the energy sector are impacted – if not driven by – unpar- alleled technological change. While wind and solar generation have been around for many years, the scope and deployment of these ener- gy resources is approaching levels that require changes to the existing legal framework in place in many jurisdictions. In addition, emerging tech- nologies, which are critical to addressing and supporting efforts to decarbonise, are becom- ing more impactful. Things such as large-scale energy storage, hydrogen and even a potential resurgence in nuclear energy are all creating pressures on existing legal and regulatory frame- works. These changes are causing jurisdictions to adjust in order to respond to these new and/ or emerging technologies. All of these changes – whether they relate directly to decarbonisation or to the further penetration of alternative energy sources – impact the energy consumer. At the individual consumer level, this results in potentially significant impacts to power quality, increases in energy costs to facilitate and underwrite the increased electrification of our economies, as well as potentially more costly sources of energy generation. The impacts to large energy consumers, such as large manu- facturing operations and other energy-intensive businesses, can be game-changers. For large industrial users of electricity, energy is tanta- mount to a raw material. An industry’s ability to manage potentially significant increases in cost over a relatively short period of time can have material consequences. Therefore, it is impor- tant for the legal and regulatory frameworks in the various jurisdictions that are aggressively moving forwards with decarbonisation and/or electrification to manage the process, such that

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INTRODUCTION Contributed by: David P. Flynn, Phillips Lytle LLP

the costs do not escalate out of control or lead to unintended economic consequences. Decarbonisation Ongoing efforts to decarbonise the energy and power sector, together with a push to use renew- able energy resources to replace carbon-based generation, is creating both opportunity and tension. The opportunity is an almost limitless market to provide new and/or emerging tech- nologies that do not rely on carbon or a carbon- based fuel to provide electric energy. There is also a very significant effort focused on further electrification of our economies and life – for example, transitioning from natural gas or coal as a source of heat, with an ever-increasing reli- ance on electric energy. This is creating incred- ible pressure on generation, transmission and distribution capabilities around the world. Certain estimates of growth in the energy sec- tor put this into some context. Growth in renew- able energy (primarily solar and wind) may result in renewable energy generation representing almost 40% of all global energy generation by 2040. In certain jurisdictions, the penetration of renewables and other non-carbon-based energy sources could reach double that number.

With the tangible impacts of climate change seemingly presenting themselves on an almost daily basis, more and more countries are recog- nising the need to decarbonise their economies. What could have been a more gradual transition is now taking on the feel of a crisis. This is forc- ing very significant (and costly) changes to occur in a very short period of time. It is also forcing the existing legal and regulatory frameworks and systems in many countries to evolve at a pace that is uncharacteristic for this sector. Conse- quently, it is imperative for those entities that are either impacted or involved in the decarbonisa- tion effort to use tools such as this Guide to bet- ter understand and facilitate the implementation of the decarbonisation efforts.

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ARGENTINA

Brazil

Paraguay

Chile

Uruguay

Buenos Aires

Argentina

Law and Practice Contributed by: Héctor Pozo Gowland, Esteban de Vedia, Carlos Ernesto Miná and Francisco Pozo Gowland Pozo Gowland Abogados Contents 1. Structure and Ownership of the Power Industry p.11 1.1 Law Governing the Structure and Ownership of the Power Industry p.11 1.2 Principal State-Owned or Investor-Owned Entities p.12 1.3 Foreign Investment Review Process p.13

1.4 Sale of Power Industry Assets p.14 1.5 Central Planning Authorities p.14

1.6 Recent Changes in Law or Regulation p.15 1.7 Announcements Regarding New Policies p.15 1.8 Unique Aspects of the Power Industry p.17 2. Market Structure, Supply and Pricing p.18

2.1 The Wholesale Electricity Market p.18 2.2 Electricity Imports and Exports p.19 2.3 Supply Mix of Electricity p.20 2.4 Market Concentration Limits p.20 2.5 Surveillance to Detect Anti-Competitive Behaviour p.20 3. Generation Facilities p.21 3.1 Constructing and Operating Generation Facilities p.21 3.2 Obtaining Approvals to Construct and Operate Generation Facilities p.21 3.3 Approvals to Construct and Operate Generation Facilities p.22 3.4 Eminent Domain, Condemnation and Expropriation Rights to Construct and Operate Generation Facilities p.22 3.5 Decommissioning a Generation Facility p.23 4. Transmission Lines and Associated Facilities p.23 4.1 Constructing and Operating Transmission Lines and Associated Facilities p.23 4.2 Obtaining Approvals to Construct and Operate Transmission Lines and Associated Facilities p.24 4.3 Terms and Conditions Imposed on Approvals to Construct and Operate a Transmission Line and Associated Facilities p.24 4.4 Eminent Domain, Condemnation and Expropriation Rights to Construct and Operate Transmission Lines and Associated Facilities p.25 4.5 Monopoly Rights to Provide Transmission Services p.26 4.6 Transmission Charges and Terms of Service p.26 4.7 Open-Access and Non-Discriminatory Transmission p.26

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ARGENTINA CONTENTS

5. Distribution p.27 5.1 Constructing and Operating Electricity Distribution Facilities p.27 5.2 Regulatory Process for Obtaining Approvals to Construct and Operate Electricity Distribution Facilities p.27 5.3 Terms and Conditions Imposed in Approvals to Construct and Operate Electric Distribution Facilities p.28 5.4 Eminent Domain, Condemnation or Expropriation Rights to Construct and Operate Electricity Distribution Facilities p.28 5.5 Monopoly Rights for Electricity Distribution Entities p.29 5.6 Electricity Distribution System Charges and Terms of Service p.29

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ARGENTINA Law and Practice Contributed by: Héctor Pozo Gowland, Esteban de Vedia, Carlos Ernesto Miná and Francisco Pozo Gowland, Pozo Gowland Abogados

Pozo Gowland Abogados is a leading law firm in Argentina in the areas of energy, M&A, infra- structure, environment and litigation, with more than 30 years’ local and international experi- ence. Providing most of the main players lo- cally with high-quality and personalised legal services, the firm has a strong commitment to clients’ interests and to supporting their busi- nesses. Pozo Gowland Abogados’s clients are

some of the most important national and in- ternational companies in their fields. The firm’s lawyers have vast experience in the markets in which they operate, particularly in corporate, litigation, arbitration, environmental and admin- istrative law and real estate. The firm and indi- vidual partners have been recognised in local and international rankings guides.

Authors

Héctor Pozo Gowland was the founding partner of Pozo Gowland & Koch (1991–2006) and subsequently the founding partner of Pozo Gowland Abogados, in 2006. He

Esteban de Vedia is one of the founding partners of Pozo Gowland Abogados (2006). He is a leading lawyer in infrastructure, construction and real estate law in Argentina.

specialises in administrative law and regulation of public services and infrastructure, and he also acts as an independent arbitrator. Héctor provides legal advice related to the energy sector in electricity, oil and gas. He has been on the board of directors and the supervisory committee of various companies related to electricity, including CAMMESA, since 1995. He has been recognised by several local and international rankings guides as a main reference in the legal power industry in Argentina.

Esteban has provided legal counsel to sponsors, developers, owners, contractors and suppliers in many local and international projects in energy, oil and gas, industrial, PPP, infrastructure and real estate projects throughout Argentina and South America. He is also specialised in arbitration and real estate. Esteban is a founding member of the Argentina Construction Law Society, associated with the International Construction Society.

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ARGENTINA Law and Practice Contributed by: Héctor Pozo Gowland, Esteban de Vedia, Carlos Ernesto Miná and Francisco Pozo Gowland, Pozo Gowland Abogados

Carlos Ernesto Miná is one of the founding partners of Pozo Gowland Abogados (2006), and is specialised in administrative law and the regulation of public services. He provides legal

Francisco Pozo Gowland has been a partner at Pozo Gowland Abogados since January 2023. He specialises in administrative law and the regulation of public services, works and

counsel on matters related to the energy sector: participation in public and private tenders, drafting and negotiation of administrative and private contracts, tariff- related matters, and renegotiation of public utility concession agreements. Carlos handles matters related to the Electricity Regulatory Framework. He has vast experience in administrative claims and proceedings, as well as in in-court and out-of-court litigation in cases related to the construction sector and public utilities.

infrastructure, and provides legal advice related to the energy sector in electricity, oil and gas. Francisco is also specialised in arbitration and litigation related to his areas of expertise. He has a postgraduate degree in administrative law, and in hydrocarbons and energy industry regulation, both from Universidad Católica Argentina.

Pozo Gowland Abogados Viamonte 1133 4th floor Buenos Aires Argentina Tel: +54 11 4375 0300 Email: pga@pg-abogados.com.ar Web: www.pg-abogados.com.ar

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ARGENTINA Law and Practice Contributed by: Héctor Pozo Gowland, Esteban de Vedia, Carlos Ernesto Miná and Francisco Pozo Gowland, Pozo Gowland Abogados

1. Structure and Ownership of the Power Industry 1.1 Law Governing the Structure and Ownership of the Power Industry Privatisation of the Power Industry and Sanction of the Regulatory Framework During 1989, privatisation took place in relation to many of the assets the national government had in the power industry, including the units of generation, transportation and distribution of energy. At the beginning of the 1990s, the national government called different tendering processes for the selling of the aforementioned assets. In addition to this, several regulations were passed, such as Law No 24,065, its Regu- latory Decree 1398/1992, and Resolutions Nos 61/92 and 137/92 (and their complementary ones), issued by the Secretary of Energy, that establish the operation programming proce- dures, the dispatch of loads and the calcula- tion of prices in the wholesale electricity market (regulations known as “the Procedures”), as well as other provisions issued by the same Secre- tary and the National Electricity Regulatory Entity ( Ente Nacional Regulador de la Electricidad , or ENRE). This legislation, together with Law No 15,336, which had been issued previously, make up the Regulatory Framework for the Electricity Industry. Structure of the Energy Industry Under Law No 24,065, the power industry is divided into three segments: (i) generation, (ii) transportation, and (iii) distribution, with gen- eral and specific regulations for each segment, as well as limitations on the right to participate simultaneously in these segments (see 2.4 Mar- ket Concentration Limits ).

Generation Generation is defined as an activity of general interest, to which free competition rules apply. However, the activity is controlled by the national government, due to its importance in terms of general interest. Control over generation activity ensures its correct functioning and, ultimately, guarantees the supply to residential, commercial and industrial users. Transportation The transmission of power is a public service, which is provided by certain companies that have signed a concession contract with the national government. In addition to the conces- sionary carriers, there are independent carriers, companies that are in charge of the operation and maintenance of a transportation line that was built after the privatisation of the industry, and that do not fall under the responsibility of a concessionary carrier. Distribution Distribution of electric power is a public service. Unlike transportation companies, which are all bonded with a concession contract with the national government, distributors can be divided into two groups: (i) Edenor and Edesur, which carry out the service in the City of Buenos Aires and in Greater Buenos Aires, and have signed a concession contract with the national govern- ment given the inter-jurisdictional nature of the service; and (ii) the provincial distributors, which do not perform an inter-jurisdictional service and do not sign a concession contract. Provincial governments control their regime tariff and con- trol the service. However, provincial distributors are also subject to the control of the national government (ENRE and the Secretary of Energy) with regard to the purchase of energy to supply users.

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ARGENTINA Law and Practice Contributed by: Héctor Pozo Gowland, Esteban de Vedia, Carlos Ernesto Miná and Francisco Pozo Gowland, Pozo Gowland Abogados

1.2 Principal State-Owned or Investor- Owned Entities Generation The following are generating companies in which the national government has a majority share- holding: • Energía Argentina SA (ENARSA) – Its sole owner is the national government. Note that the limitations under Law No 24,065 regard- ing participation in more than one segment of the industry do not apply to ENARSA. The company is also active in the oil and gas industry. • YPF Luz – The national government is indi- rectly the majority shareholder of the com- pany, through YPF SA. The other shareholder is General Electric. • Nucleoeléctrica SA (NASA) – Wholly owned by the national government, it is the only company in Argentina dedicated to the gen- eration of energy from a nuclear source. • Yacyretá. • Salto Grande. The main private generation companies are: • Pampa Energía; • AES; • Central Puerto; • Orazul; • MSU; and • in the renewable energy sector, in addition to the aforementioned companies – Gen- neia, 360 Energy, Latinoamericana de Energía SA, Petroquímica Comodoro Rivadavia SA, JEMSE, Arauco SAPEM, and Construcciones Electromecánicas del Oeste SA. Transmission All the companies in the transportation segment are the majority property of private capital and,

The Generation of Renewable Energies Generation of electricity from renewable sources is ruled by Laws No 26,190 and No 27,191, which are complemented by Decree No 531/2016, Resolution 281/17 and Provision 1/18. Ownership in the Energy Industry Most of the assets in the industry are owned by private capital, with some exceptions because the national government participates in some companies as a minority or majority sharehold- er (see 1.2 Principal State-Owned or Investor- Owned Entities ). Storage Energy storage is the process of accumulating energy in particular equipment or systems for later use. The importance of these systems is that they cover short-term capacity requirements and provide fast-response back-up services. The current development of electrical energy storage technology represents an opportunity for its integration into the transmission and gen- eration lines, and for incorporation of some of its applications to contribute to supplying demand, optimising dispatch, reducing costs and provid- ing additional services to the operation. Energy storage can be combined with intermit- tent renewable generation in order to expand its penetration and optimise the incorporation of the electrical power transmission and distribu- tion network infrastructure, allowing the devel- opment of a cleaner and more efficient energy matrix.

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ARGENTINA Law and Practice Contributed by: Héctor Pozo Gowland, Esteban de Vedia, Carlos Ernesto Miná and Francisco Pozo Gowland, Pozo Gowland Abogados

in certain cases, the national government acts as a minority shareholder: • TRANSENER (the national government is an indirect minority shareholder); • TRANSBA (the national government is an indirect minority shareholder); • TRANSPA; • DISTROCUYO; • Compañía de Transmisión del Mercosur SA (CTM) and Transportadora de Energía SA (TESA); and • the independent carriers are the property of private capital, the most relevant being YACYLEC, LITSA and LIMSA. Distribution The companies with a concession contract with the national government are EDENOR and EDESUR and, in both cases, the national gov- ernment has minority participation. In addition, there are several distribution companies that operate locally at a provincial level. • TRANSNEA; • TRANSNOA; • TRANSCOMAHUE; 1.3 Foreign Investment Review Process There are no foreign investment restrictions or protections in the Argentine power industry, except in the case of construction of new facili- ties by government-owned companies, for which the supply of local goods may be applicable. The specific thresholds and conditions for investment approval may vary depending on the segment of the industry and the nature of the investment. Argentina needs to renew and expand its energy infrastructure, and new pro- jects are envisaged in the coming years.

Argentina has legal frameworks in place to pro- tect foreign investments, including in the power industry. These protections include safeguards against seizure, confiscation and expropriation without proper compensation. Foreign inves- tors have access to domestic courts to resolve disputes, as well as to commercial arbitration. International arbitration regarding investment is also available in accordance with applicable international treaties. Foreign investment in Argentina is undergoing a drastic change due to Law No 27,742, which was sanctioned in July 2024. This law is named the “Law of Basis and Starting Points for the Freedom of Argentines” and it contains a chapter about investment called the “Incentive Regime for Large Investments” ( Régimen de Incentivo para Grandes Inversiones , or RIGI). With the pur- pose of promoting the economic development of the country and attracting investments, both domestic and foreign, this regime proposes, in general terms, the creation of a scheme that grants conditions of predictability and stability, legal certainty and special protection to private individuals from the conduct of the state. In line with this, large investment projects that enter into this system will have important exchange, tax and customs benefits. Investments made under the RIGI will be considered to be of “national interest”, meaning that any national or local rule that may infringe on this will be null and void. YPF LUZ has requested that the 305 MW “El Quemado” solar farm that plans to build in Men- doza be accepted under the RIGI. The project has already been approved, which means that the investment is subject to the RIGI. Also, Pet- roquímica Comodoro Rivadavia and Acindar requested that a wind farm they plan to build be accepted under the RIGI.

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ARGENTINA Law and Practice Contributed by: Héctor Pozo Gowland, Esteban de Vedia, Carlos Ernesto Miná and Francisco Pozo Gowland, Pozo Gowland Abogados

1.4 Sale of Power Industry Assets General Law No 24,065 (Sections 31 and 32) and Decree 1398/92 (Section 9) include the following limita- tions for the transfer of shares of carriers and distributors: • no generator, distributor, high-demand user or company controlled by any of them, or a con- troller thereof, may be the owner or majority shareholder of a carrier or its controller; • only with the prior authorisation of ENRE may two or more carriers, or two or more distribu- tors, consolidate in the same business group or merge; • only with the prior authorisation of ENRE may a carrier or distributor buy shares of another carrier or distributor, respectively; and • the holder of a distribution concession may not own generation units. Generation Hydroelectric generators with a capacity above 500 kV that use public watercourses must enter into a concession contract with the national gov- ernment and are subject to the limitations pro- vided therein to transfer the assets. Generators that use thermal and renewable technologies are not subject to restriction to asset transfers but may not own or be majority shareholders of a Transmission and distribution concession con- tracts generally provide the same restrictions: the transfer of the majority stockholding requires ENRE’s prior approval. The approval process is ruled by ENRE’s Resolutions 548/99 and 499/05. Typically, although not expressly required by law, ENRE may require that the new shareholders comply with certain financial ratios and industry expertise background. carrier or its parent company. Transmission and Distribution

Market Influence Antitrust is governed by Law No 27,442, which sanctions conduct that may be detrimental to the general economic interest. This law estab- lishes as a restrictive practice of competition, to fix, agree or manipulate, directly or indirectly, the selling price of a good offered in the market. 1.5 Central Planning Authorities National Secretariat of Energy The National Secretariat of Energy is the author- ity overseeing the application of the Regulatory Framework and has the power to dictate the provisions that regulate the national dispatch of loads. The Secretariat has dictated the regula- tions known as Los Procedimientos (“the proce- dures”), which organise the wholesale electricity market. ENRE ENRE’s main role is to regulate and supervise the electricity sector to ensure the reliability of the electricity system and the adequacy of supply to meet the demand for electricity. The scope of ENRE’s functions and powers is set forth in Law No 24,065. CAMMESA The joint stock company, CAMMESA, which administers the wholesale electricity market has two main functions: (i) it is in charge of electricity dispatch; and (ii) it settles the operations in the wholesale electricity market, making the collec- tions and remitting to each creditor the amounts that correspond to them for the services pro- vided (generation, transmission or distribution). The shareholders of CAMMESA are the national government, and the associations of generators, transportation companies, distributors and big users.

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ARGENTINA Law and Practice Contributed by: Héctor Pozo Gowland, Esteban de Vedia, Carlos Ernesto Miná and Francisco Pozo Gowland, Pozo Gowland Abogados

National Government The distribution of electric power in the City of Buenos Aires and in Greater Buenos Aires falls under Edenor and Edesur, who have signed a concession contract with the national govern- ment given the inter-jurisdictional nature of the service. The national government rules on their regime tariff and controls the service. Provincial Government The distribution of electric power in the rest of Argentina is carried out by the provincial distribu- tors, which do not perform an inter-jurisdictional service and do not sign a concession contract. Provincial governments rule on their regime tar- iff and control the service. However, provincial distributors are also subject to the control of the national government (ENRE and the Secretary of Energy) with regard to the purchase of energy to supply users. 1.6 Recent Changes in Law or Regulation Argentina’s energy sector has undergone signifi- cant regulatory changes aimed at enhancing effi- ciency, attracting investment, and modernising the electricity market. This section deals with the changes that have already been implemented, while the following section, 1.7 Announcements Regarding New Policies , discusses the guide- lines that the Secretariat of Energy is designing for the industry. One of the most notable developments has been the government’s decision to repriva- tise the Comahue hydroelectric plants. These facilities, including Alicurá, El Chocón, Cerros Colorados, and Piedra del Águila, collectively contribute approximately 4,107 MW of electric- ity, representing about 13% of the nation’s total generation capacity. The new concession model proposes a 30-year term, during which, 95% of

the generated energy will initially be allocated to meet residential demand at a preferential rate of USD15–20 per MWh. The remaining 5% can be sold at market prices, with this proportion expected to increase over time. In April 2024, the Secretariat of Energy issued Resolution No 34/2024, altering the payment pri- ority order of CAMMESA, the wholesale electric- ity market administrator. This change prioritises payments to electricity transmission service pro- viders over payments to generation companies, aiming to ensure the reliability of the transmis- sion network amid financial constraints. Furthermore, the Secretariat of Energy enacted Resolution No 21/2025, which repeals several provisions of Resolution No 1,281/2006. This new regulation allows new electricity generation installations to allocate their energy to the term market ( Mercado a Término ), providing greater flexibility and encouraging investment in the sec- tor. Collectively, these regulatory changes reflect Argentina’s commitment to revitalising its energy sector by promoting private investment, ensur- ing reliable service delivery, and aligning with market-oriented practices. 1.7 Announcements Regarding New Policies General elections were held in 2023, and in December 2023 a new government took office, under the promise of restructuring the energy industry, going back to what legislation issued in the 1990s contemplated, which was almost never applied. In this sense, on 28 January 2025, the Secretar- iat of Energy issued Note NO-2025-09628437- APN-SE#MEC, addressed to CAMMESA, intro-

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ARGENTINA Law and Practice Contributed by: Héctor Pozo Gowland, Esteban de Vedia, Carlos Ernesto Miná and Francisco Pozo Gowland, Pozo Gowland Abogados

ducing the “Guidelines for the Normalization of the Wholesale Electricity Market and Its Pro- gressive Adaptation” (the “Guidelines”). These Guidelines outline the strategic regulatory and economic framework that will govern the pro- gressive reform of Argentina’s Wholesale Elec- tricity Market ( Mercado Eléctrico Mayorista, or MEM). Overall Objective The Secretariat of Energy aims to re-establish economic and regulatory discipline in the MEM, addressing long-standing imbalances caused by price distortions, subsidies, and delayed invest- ments. The reform is designed to ensure long-term sus- tainability, fiscal efficiency, and enhanced reli- ability of the electricity grid. Adapted Marginal Spot Factor (FSA) • A central instrument in the reform is the intro- duction of an “Adapted Marginal Spot Factor” ( Factor de Spot Marginal Adaptado , or FSA), which will allow prices to progressively reflect marginal generation costs. • The FSA will initially apply to large users (known as GUMAs, GUMEs, and GUDIs), with the potential to expand to other segments in later phases. • This mechanism seeks to improve cost sig- nalling, efficiency, and investment conditions in the MEM. Cost recovery and tariff reform • The Guidelines propose tariff adjustments aimed at recovering generation and transmis- sion costs in a gradual, socially responsible manner. • While full cost transfer is not immediate, the policy sets a path towards economic sustain- ability by reducing reliance on state subsidies.

• The reform includes pricing schemes that differentiate among user segments based on their consumption profile and capacity to pay. Investment promotion • Improving price signals and economic rationality is seen as essential to reviving investment flows in generation, particularly in thermal back-up capacity and renewable projects. • The Guidelines emphasise the need for a stable investment climate, underpinned by transparent rules and reliable remuneration mechanisms. Regulatory stability and institutional strengthening • The reform prioritises regulatory predictability and clear rule-making as core enablers of market confidence. • CAMMESA will continue to administer the market, but its planning and operational processes will be strengthened to improve decision-making and efficiency. • Co-ordination with ENRE and stakeholders will be enhanced. Renewable and distributed generation • The Guidelines support the integration of renewable energy and distributed generation, providing tailored price signals to reflect their grid value. • Complementary storage systems are also being promoted to facilitate the transition to a flexible and modern energy matrix. Consumer impact and protection mechanisms • Large users will experience a gradual transi- tion towards marginal-cost pricing, while households and small commercial users will

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ARGENTINA Law and Practice Contributed by: Héctor Pozo Gowland, Esteban de Vedia, Carlos Ernesto Miná and Francisco Pozo Gowland, Pozo Gowland Abogados

remain under the current segmentation and subsidy regimes. • Transitional protection mechanisms and gradual implementation are intended to avoid social disruption and ensure policy accept- ability. Phased implementation and stakeholder dialogue • Implementation will occur progressively, allowing the market to adapt and policymak- ers to refine measures based on real-world performance. • The Secretariat is committed to consulting stakeholders – including industrial users, gen- erators and provincial authorities – to ensure a co-ordinated roll-out. Strategic vision • The reform is embedded in a broader vision of modernising Argentina’s electricity system, reducing fiscal pressure, and enabling energy transition. • The end goal is a competitive, cost-reflective, and innovation-friendly electricity market that ensures long-term energy security and finan- cial health. 1.8 Unique Aspects of the Power Industry Argentina’s electric power industry presents sev- eral distinctive features that make it particularly attractive to investors. One of the most relevant is the shift in political direction under the new government, which is promoting a liberalisation of the electricity market. This includes a move toward cost-reflective pricing, reduced state intervention, and increased participation of pri- vate players in generation, transmission and commercialisation. Recent regulatory reforms are aimed at restoring economic rationality to the market, providing legal certainty, and unlocking

investment flows that have remained dormant in recent years. The country also possesses exceptional natu- ral conditions for the development of renewable energy. Argentina has one of the world’s highest wind capacity factors, particularly in Patagonia, and excellent solar radiation levels in the north- west. These factors make large-scale wind and solar projects not only viable but globally com- petitive in terms of generation cost and output reliability. Furthermore, Argentina is emerging as a strong candidate in the green hydrogen econ- omy due to its abundant renewable resources, access to water, and potential port infrastructure for export. Additionally, the government has reaffirmed its commitment to nuclear energy as part of a long- term diversification strategy. The national nucle- ar plan includes the completion of the fourth nuclear power plant (Atucha III), and long-term plans for small modular reactors (SMRs) such as CAREM, developed by Argentina’s National Atomic Energy Commission ( Comisión Nacional de Energía Atómica , or CNEA). These initiatives are intended to provide baseload generation with zero carbon emissions, supporting energy security and decarbonisation objectives. Lastly, Argentina offers significant potential for hosting energy-intensive infrastructure such as data centres. The availability of competitive elec- tricity – especially from renewable and nuclear sources – alongside a favourable climate (that reduces cooling costs) and a skilled technical workforce, positions the country as an attrac- tive location for companies requiring large, sta- ble power loads. As global demand for digital infrastructure grows, Argentina stands out as a strategic platform in Latin America for sustain- able, high-consumption operations.

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ARGENTINA Law and Practice Contributed by: Héctor Pozo Gowland, Esteban de Vedia, Carlos Ernesto Miná and Francisco Pozo Gowland, Pozo Gowland Abogados

2. Market Structure, Supply and Pricing 2.1 The Wholesale Electricity Market Structure Generators are involved in the wholesale elec- tricity market or MEM, together with the other agents: transporters, distributors and high- demand users. Two markets co-exist in the MEM: (i) a forward market, with volumes, prices and conditions freely agreed between sellers and buyers; and (ii) a spot market, with prices sanctioned hour- ly based on the economic cost of production, unlike the forward market where the price is freely agreed between the parties. Forward market Since 2013, entry into new contracts in this market has been prohibited, if they involve gen- eration from a conventional source (thermal or hydroelectric). However, contracts in this market are allowed if energy comes from a renewable project. This government expressed its intention to allow the celebration of new contracts in these markets. The new regulation is expected to be issued in 2025. Spot market Prices in the spot market come from the margin- al cost of the system (cost of the most inefficient machine that covers the demand) at a certain hour. Based on the demand at each moment and the availability of supply, CAMMESA dispatches the generation equipment that is able to cover the demand and is the most economical. The spot market price of each hour is the cost fixed for the most expensive machine dispatched in that hour.

In addition to the spot price, there is the seasonal price – the cost paid by distributors for the ener- gy they acquire from generators to supply users. Prices are stabilised on a quarterly basis since they are what users pay for the supply of energy. In this way, the distributors know the price of the energy purchased in the spot market, which they transfer to the rate paid by their customers. This modality is known as pass-through, since distributors transfer this cost directly to their customers’ rates. The differences between the spot price, paid to generators by CAMMESA, and the seasonal price, paid by distributors to CAMMESA, are accumulated in the stabilisation fund, which reflects the aforementioned gap and is used by CAMMESA when there are insufficient funds to pay generators from what was raised from dis- tributors, when the spot price is higher than the seasonal price. Storage In 2025, the Argentine government officially launched a landmark public tender through Res- olution No 67/2025 issued by the Secretariat of Energy. The tender calls for the development of battery energy storage systems (BESS) in the Buenos Aires Metropolitan Area (AMBA), one of the country’s most critical electricity demand zones. Known as the “AlmaGBA” project, the ini- tiative aims to install 500 MW of storage capacity in strategic nodes within the grid, with an esti- mated investment of USD500 million. The goal is to enhance grid stability, especially during peak demand periods, and to reduce reliance on emergency generation. The systems will be deployed in collaboration with the main electricity distribution compa- nies, Edenor and Edesur, and will be backed by CAMMESA as financial guarantor. The pro-

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ARGENTINA Law and Practice Contributed by: Héctor Pozo Gowland, Esteban de Vedia, Carlos Ernesto Miná and Francisco Pozo Gowland, Pozo Gowland Abogados

ject is part of Argentina’s broader energy mod- ernisation agenda and seeks to attract private investment under a transparent and competitive framework. Supported by international financing, the programme prioritises speed of deployment and long-term operational reliability. Addition- ally, the federal government is encouraging the provinces to replicate the model in other regions identified as critical by CAMMESA. The tender reflects Argentina’s strategic move towards a more resilient, flexible and sustainable energy system. Data Centres The current president, Javier Milei, has expressed interest in creating an important technological hub in Argentina, with a primary focus on AI. In May, Milei gave a presentation at an event that brought together leading figures from Silicon Valley technology companies, where he affirmed his commitment to working towards a regulatory framework that balances the need to allow tech- nology companies to thrive and contribute to the economic growth of the country and the world. In addition, the chief adviser to the president, Demian Reidel, has articulated a vision position- ing Argentina as a prime location for establish- ing energy-intensive infrastructure, such as data centres. He emphasises that the exponential growth in energy demand driven by AI neces- sitates power sources that are clean, scalable, and stable – qualities he attributes uniquely to nuclear energy. To meet this demand, Reidel has advocated for the development of SMRs, spe- cifically the ACR-300, designed by Argentina’s state-owned tech company, Invap. This initiative aims to leverage Argentina’s nuclear capabilities to support the burgeoning AI sector. \

Reidel envisages the creation of a “Nuclear City” in Patagonia, a region characterised by its cooler climate and abundant land, making it ideal for hosting large-scale data centres. This strategic plan includes constructing a 1.2 GW SMR pro- ject, fully financed by private American invest- ment, with the goal of operational readiness by 2030. The project not only aims to supply the necessary energy for AI-driven data centres but also positions Argentina as a potential exporter of SMR technology. Reidel underscores that the combination of Argentina’s nuclear expertise and favourable geographic conditions presents a unique opportunity to attract significant foreign investment in the tech sector. Furthermore, Reidel highlights the broader eco- nomic and strategic benefits of this initiative. By capitalising on the global shift towards AI and the corresponding energy demands, Argentina can establish itself as a leader in next-genera- tion nuclear technology. This approach not only addresses the immediate energy needs of AI infrastructure but also fosters long-term eco- nomic growth through technology exports and enhanced energy security. Reidel’s plan reflects a concerted effort to align Argentina’s energy strategy with emerging global technological trends. 2.2 Electricity Imports and Exports Argentina is connected to neighbouring coun- tries through various transmission lines but currently, generators cannot freely enter into contracts for the export and import of electrical energy in the forward market, with volumes, pric- es and conditions freely agreed between sellers and buyers. The export and import of electrical energy are currently centralised in CAMMESA. If a generator requests to export electrical energy, it must obtain authorisation from the Secretariat of Energy and CAMMESA.

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ARGENTINA Law and Practice Contributed by: Héctor Pozo Gowland, Esteban de Vedia, Carlos Ernesto Miná and Francisco Pozo Gowland, Pozo Gowland Abogados

2.3 Supply Mix of Electricity According to information available on the CAMMESA website, in the 2023 annual report, the supply mix of electricity in Argentina, con- sidering the total installed capacity, is as follows: • thermal – 54.4%; • renewable – 37.7%; and • nuclear – 8.2%. Considering only renewable energy, the total installed capacity is: • wind – 76%; • solar – 19%; and • other technologies – 5% 2.4 Market Concentration Limits There are no specific concentration limits regard- ing the percentage of electricity supply, but there is legislation regarding concentration limits that provides a general framework applicable to several industries. Law No 27,442 on Antitrust provides that economic concentrations with the object or effect of limiting, restricting or distort- ing competition are prohibited, as they may be detrimental to the general economic interest. On the one hand, the law controls conduct on an ex-post basis, preventing concerted prac- tices and abuses of a dominant position; and, on the other, it controls M&A transactions, ex- ante, through a system of prior notification. The prior notification system is triggered when an economic operation meets certain requirements. As established by law, the National Competition Authority is in charge of studying the impact of the operation in the relevant market and will decide if it is approved, rejected or conditioned. In any case, the National Competition Authority has not yet been constituted, and its functions are carried out by the National Commission for

the Defence of Competition ( Comisión Nacional de Defensa de la Competencia , or CNDC). If M&A transactions involve regulated activities (eg, utilities such as transmission and distribu- tion of electricity), the pertinent regulatory body, in this case, ENRE, must be consulted and must issue an opinion on the operation, on the impact on competition in the respective market, and on compliance with the regulatory framework. The response is not binding, however, and the absence of a response is taken to mean that the regulatory entity does not object to the opera- tion. Heavy penalties may be imposed on companies that do not comply with antitrust regulations. 2.5 Surveillance to Detect Anti- Competitive Behaviour See 2.4 Market Concentration Limits . Anti- competitive conduct and market surveillance, and the enforcement process are contemplated in Antitrust Law No 27,442. This establishes the legal framework for the promotion of competi- tion, the prevention of anti-competitive practic- es, and the protection of consumers. The CNDC has jurisdiction over the entire coun- try. Its powers and scope of authority include conducting investigations, compelling produc- tion of records, entry to property and search and seizure, and conducting interviews. Potential sanctions for anti-competitive behav- iour may include fines, injunctions, divestitures and other remedies to compensate harm caused by anti-competitive conduct. The specific pen- alties and sanctions are determined on a case- by-case basis, taking into account the severity of the behaviour and its impact on competition and consumers.

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