He President Gustavo Petro assumed, for a term of three months, the functions of a general nature delegated to the Drinking Water and Basic Sanitation Regulation Commission (CRA) and the Energy and Gas Regulation Commission (Creg).
(It may interest you: Petro will assume the regulation of public services for 3 months)
The decision, according to the National Government, is due to the fact that, despite the regulatory measures that were taken in 2022 to lower energy rates, the expected results will not be obtained, although it will limit stopping the upward trend.
After the announcement, the Creg -in an extensive letter- warned the Minister of Mines and Energy Irene Vélez of the importance of maintaining a regulatory framework that is the product of a technical discussion between the Government.
(Also: Ruiz’s harsh objections to Vélez’s management of the controversial report on gas)
This institution places special emphasis on the consequences that an intervention in tariffs would bring for the sustainability of the system.
«An intervention of tariffs outside the scheme created since 1994, it will certainly affect the obligations to provide the service and will intrinsically modify the remuneration conditions, with its consequent effect on the continuity, quality and other rights of service users; not only in the short term, but it will affect the sustainability of the sectors that are involved and, directly, the confidence to make investments in the sector”, requested the Creg in the letter to Irene Vélez.
(Read: Analysts see the changes to electricity and service laws as inconvenient)
The Creg said that it understands the Government’s concern about the current energy service rates, which led to the intervention of President Petro, but made «a call for respect to act with absolute technical rigor, analyzing the problem that is being addressed based on evidence, identifying its causes and effects, observing the rationale for actions that will effectively have an impact on tariff levels, and assessing the risks of an untimely or insufficiently valued decision with the required depth”.
(It may interest you: Fitch sees risks due to Petro’s intervention in the regulation of electricity)
The entity also stated that the increases in energy rates are not a consequence of the regulator’s failure to comply with the rate principles when establishing rate methodologies and formulas, but rather the effect of increases in investment and operating costs, in a high inflation environment.
LATEST NEWS EDITORIAL
