The World Bank Board of Directors has approved an additional US$300 million in financing to support Argentina’s efforts to strengthen institutional capacity in the energy sector, with a focus on improving the targeting of gas subsidies, protecting vulnerable households, and promoting fiscal and environmental sustainability. The operation aims to ensure that energy subsidies are more efficient, equitable, and aligned with long-term sustainability goals.
This additional financing builds on the ongoing project supporting the transition to a sustainable electricity sector, which has already improved the Energy Subsidy Access Registry and enabled the successful reclassification of 1.2 million households. These advances have laid the groundwork for more accurate identification of beneficiaries and better allocation of public resources.
The project seeks to expand coverage to both natural gas network users and households that rely on bottled gas, with particular attention to low-income families and regions without access to piped gas. By addressing the needs of populations that depend primarily on bottled gas for cooking, the initiative aims to reduce inequality in access to energy support.
A key focus of the operation is the simplification, harmonization, and modernization of existing gas subsidy schemes. Integrating bottled gas beneficiaries into a unified registry will improve access to subsidies and facilitate links to complementary social programs, while better aligning subsidies with actual household energy consumption patterns.
Through these reforms, the project is expected to improve equity within the energy system, encourage more efficient energy use, reduce unnecessary consumption, and lower fiscal costs. The loan is structured with a variable spread, a 32-year repayment period, and a seven-year grace period, providing long-term support for Argentina’s sustainable energy transition.
