Recent Developments
Strategic Growth Projects
in our Renewable, Thermal and Hydroelectric Portfolio
During
2025, we completed and advanced several strategic growth projects across our renewable, thermal and hydroelectric portfolio.
In
August 2025, we completed the acquisition of the Cafayate solar photovoltaic plant, an 80 MW facility located in the Province of Salta.
During 2025, we also completed and started operations in the San Carlos solar photovoltaic plant, a 15 MW facility located in the Province
of Salta.
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In
addition, during 2025, we completed the construction of the Brigadier López combined-cycle expansion project, located in the Province
of Santa Fe. This project, which was already operational as of December 31, 2025, commenced commercial operations in January 2026 and
added approximately 140 MW of combined-cycle capacity.
On
January 9, 2026, we took over a new 30-year concession for the Piedra del Águila hydroelectric plant, following a national and
international public tender process conducted by the Argentine government. The facility has an installed capacity of 1,440 MW and the
economic offer for the concession was US$245 million. The new concession secures long-term operating rights for one of the largest hydroelectric
assets in Argentina.
For a description of Central Puerto’s
principal capital expenditures for the years ended December 31, 2023, 2024 and 2025, see Item 5.B "Liquidity and Capital Resources-—Capital
Expenditures”.
Battery Energy Storage
System (BESS) Projects
In
August 2025, we were awarded two BESS projects under long-term contracts, and we commenced initial development activities shortly thereafter.
Both projects are expected to be completed by mid-2027.
The
first project, located at the Central Puerto complex, is expected to have an installed capacity of 150 MW and use lithium iron phosphate
(LFP) technology supplied by Contemporary Amperex Technology Co., Limited (CATL). Edenor, one of the largest electricity distributors
in Argentina, is expected to be the offtaker for this project. The second project, located at Central Costanera, is expected to have an
installed capacity of 55 MW, use LFP technology supplied by CATL and have Edesur (another major electricity distributor in Argentina)
as its offtaker. Each BESS project has a contractual term of 15 years. Estimated aggregate capital expenditures for the two projects are
expected to range between US$130 million and US$140 million.
Under
the applicable contractual framework, revenues are primarily capacity-based and consist of fixed payments per MW per month, subject to
operational performance parameters, with a maximum discharge duration of up to five hours. Energy required to charge the batteries is
nominated and supplied by CAMMESA at no additional cost to the projects, and the contracts do not contemplate energy price arbitrage.
Variable operating costs are limited and include a charge per MWh of energy discharged.
Simplification of Corporate
Structure at Central Puerto S.A.
Merger of forestry companies
On March 31, 2025, the
Board of Directors of Empresas Verdes Argentina S.A. (EVASA), Forestal Argentina S.A. (FASA), Estancia Celina S.A. (ECSA) and Las Misiones
S.A. (LMSA) approved the corporate reorganization whereby EVASA would absorb the entirety of EVASA, FASA, ECSA and LMSA’s assets
and liabilities, thereby assuming ownership of all assets, liabilities, rights, and obligations of such companies as of the effective
date of the merger. The merger became effective on June 30, 2025, after which the legal name of EVASA was changed to Forestal Argentina
S.A.
CP Renovables Merger
On March 31, 2025, CEPU
and CP Renovables’ Boards of Directors approved a corporate reorganization whereby CEPU would absorb the entirety of CP Renovables’
assets and liabilities, thereby assuming ownership of all assets, liabilities, rights, and obligations of CP Renovables as of the effective
date of the merger.
On June 17, 2025, Central
Puerto and CP Renovables entered into a definitive merger agreement. The merger became effective on October 1, 2025, at which time
Central Puerto received all of the assets and assumed all of the liabilities of CP Renovables. Following the merger, CP Renovables was
dissolved without liquidation, as Central Puerto directly and indirectly owns 100% of the shares of CP Renovables.
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Merger of Puerto
Energías Renovables S.A.U. (formerly known as Vientos La Genoveva II S.A.)
On January 1, 2025, the
effective merger of Vientos La Genoveva II S.A., a wholly controlled subsidiary of Central Puerto S.A., with CP Manque S.A.U., CP Los
Olivos and CPR Energy Solutions S.A.U., occurred. The merger was officially registered before the public registry on January 28, 2025.
Consequently, the absorbed companies were dissolved without liquidation, and their assets and liabilities were transferred to Vientos
La Genoveva II S.A. On December 22, 2025, the legal name of Vientos La Genoveva II S.A. was changed to Puerto Energías Renovables
S.A.U.
Completion of Ecogas Inversiones Spin-off
and Merger
On October
1, 2025, following receipt of the required authorizations from the CNV and the Buenos Aires Stock Exchange (Bolsa de Comercio de Buenos
Aires or “BCBA”), and pursuant to the approvals granted by the extraordinary shareholders’ meetings of Central
Puerto and Ecogas held on May 22, 2025, Central Puerto completed its previously announced spin-off and merger transaction with Ecogas,
in accordance with the definitive corporate reorganization agreement executed on June 17, 2025.
Under
this spin-off and merger transaction, CEPU transferred to Ecogas certain equity interests and Ps.305 million in cash, and Ecogas issued
80,973,264 new Class D common shares to CEPU shareholders on a pro rata basis, using September 26, 2025 as record date and an exchange
ratio of one Ecogas share for every 18.6694 CEPU shares, with cash paid in lieu of fractional shares. Following the transaction, Ecogas
increased its share capital and continued as the surviving entity holding the spun-off assets, while CEPU continued to operate its electricity
generation business.
CEPU
shareholders in Argentina, as well as holders of CEPU American Depositary Receipts, received the corresponding Ecogas securities on October
1, 2025.
Shareholders’ General Meeting
On March 5, 2026, the Board of Directors of Central
Puerto convened the Annual General Meeting of Shareholders for April 30, 2026 to discuss the following items of the agenda and relating
to the financial statements we prepare in accordance with the CNV Rules:
1. Appointment of two shareholders to sign the minutes.
2. Consideration of the Consolidated Statement of Income, the Consolidated Statement of Comprehensive Income, the Consolidated Statement Of Financial Position, the Consolidated Statement of Changes in Equity, the Consolidated Statement of Cash Flows, the Notes to the Consolidated Financial Statements and Exhibits, the Individual Income Statement of Income, the Individual Statement of Comprehensive Income, the Individual Statement of Financial Position, the Individual Statement of Cash Flows, Notes to the Individual Financial Statements, Brief, Auditor Report, and the Statutory Audit Committee Report, all of them for the fiscal year ended December 31, 2025.
3. Consideration of the income (loss) for the fiscal year and the Board of Directors’ proposal to allocate the accumulated retained earnings for the creation of an optional reserve to be used, indistinctly: (i) for the distribution of dividends based on the evolution of the financial position of CEPU and the CEPU’s provisions related to dividends distribution in force, and to delegate to the Board of Directors the power to partially or totally release such reserve for the distribution of dividends and the determination of the time, currency, terms and other conditions related to the payment, pursuant to the scope of the delegation granted by the Shareholders’ Meeting, and (ii) for the acquisition of the CEPU’s treasury shares, delegating to the Board of Directors the power to determine the time, terms and conditions of its release, whether partial or total, to be applied to such end. Consideration and approval of the payment of the Profit-Sharing Bond under Sections 12 and 33 of the bylaws. Consideration of the allocation of the statutory reserve surplus in an amount equal to Ps. 29,273,279 thousand.
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4. Consideration of the Board of Directors performance during the fiscal year ended December 31, 2025.
5. Consideration of the Statutory Audit Committee performance during the fiscal year ended December 31, 2025.
6. Consideration of the remuneration of the Board of Directors for the fiscal year ended December 31, 2025, within the limits of profit pursuant to section 261 of the Business Entities Act and CNV Regulations. Consideration of the advanced payment of fees to the Board of Directors for the fiscal year ending December 31, 2026.
7. Consideration of the remuneration of the members of the Statutory Audit Committee for the fiscal year ended December 31, 2025; and the fee scheme for the period ending December 31, 2026.
8. Board of Directors’ partial renewal. Appointment of three directors and three deputy directors for a period of three fiscal years pursuant to Section 17 of the bylaws. Continuity of the current Chairman until the appointment of a new Chairman by our Board of Directors.
9. Appointment of the Statutory Audit Committee members and deputy members for the fiscal year ending December 31, 2026.
10. Consideration of the remuneration of our certifying accountant regarding the annual accounting documents for the fiscal year 2025.
11. Appointment of the certifying accountant and of the deputy certifying accountant for the fiscal year ending December 31, 2026, and the fixing of their remuneration.
12. Approval of the Annual Budget for the functioning of the Supervisory Committee.
13. Granting of authorizations.
Item 4.A History and development of the
Company
Central Puerto S.A. is incorporated as a sociedad
anónima under the laws of Argentina. Our principal executive offices are located at Avenida Thomas Edison 2701, C1104BAB Buenos
Aires, Republic of Argentina. Our telephone number is +54 (11) 4317-5000.
We were incorporated pursuant to Executive Decree
No. 122/92 on February 26, 1992. We were formed in connection with the privatization process involving Servicios Eléctricos
del Gran Buenos Aires (“SEGBA”) in which SEGBA’s electric power generation, transportation, distribution, and sales
activities were privatized. We were registered with the Public Registry of Commerce of the City of Buenos Aires on March 13, 1992, and
created for a term of 99 years from the date of such registration.
In April 1992, Central Puerto, the consortium-awardee,
took possession over SEGBA’s Central Nuevo Puerto (“Nuevo Puerto”) and Central Puerto Nuevo (“Puerto Nuevo”)
plants, and we began operations. In November 1999, the Puerto combined cycle plant, which was built on lands owned by Nuevo Puerto in
the City of Buenos Aires, started to operate. In 2001, Central Puerto was acquired by the French company, Total S.A. At the end of 2006,
Sociedad Argentina de Energía S.A. (“SADESA”) acquired a controlling interest in Central Puerto.
Our shares are listed on the BYMA and, since
February 2, 2018, have been listed on the NYSE under the symbol “CEPU”.
As of December 31, 2025, we operated one hydroelectric
generation plant, owned, and operated six thermal generation plants, seven wind farms and three solar farms, for the generation of electric
power in Argentina. As of the same date we also had a combined installed capacity of 6,933 MW and had significantly improved our position
as a major SADI electric power generator, producing approximately 13.02% of the total SADI offer in 2025.
The SEC maintains an internet site that contains
reports and other information regarding issuers who, like us, file electronically with the SEC. The address of that website is http://www.sec.gov.
Central Puerto routinely posts important information for investors in the Investor Relations support section on its website, www.centralpuerto.com.
From time to time, Central Puerto may use its website as a channel of distribution of material Company information. Accordingly, investors
should monitor Central Puerto’s Investor Support website, in addition to following our press releases, SEC filings, public conference
calls and webcasts. The information contained on, or that may be accessed through, our website is not incorporated by reference into,
and is not a part of, this annual report.
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Hidroeléctrica Piedra del Águila
S.A. (HPDA)
HPDA was a sociedad anónima (corporation)
incorporated in 1993 that operated the Piedra del Águila hydroelectric complex during a thirty-year concession period, with an
installed capacity of 1,440 MW since it started commercial operations in 1993.
On April 9, 2025, the Argentine Government established
a 15-day period to launch a national and international public tender to offer certain hydroelectric assets in Argentina, including Piedra
del Águila, to private investors for a new concession term. On December 29, 2025, the tender process was completed and the concession
for the Piedra del Águila hydroelectric complex was awarded to Central Puerto, which took over such concession on January 9, 2026,
for a 30-year period.
Renewable energy projects
In 2016, we incorporated a subsidiary, CP Renovables,
to develop renewable energy generation projects. As of the date of this annual report, the company participated in the Renovar Rounds
1.0 and 1.5, in which it was awarded with the La Castellana I and Achiras projects with 20-year PPA contracts with CAMMESA, each of the
projects constructed by CP La Castellana S.A.U. (a subsidiary of CP Renovables S.A.) and CP Achiras S.A.U. (a subsidiary of CP Renovables
S.A.). La Genoveva I is a project from RenovAr 2.0 developed constructed and operated by Vientos La Genoveva S.A.U. (a subsidiary of Central
Puerto S.A.). CP Renovables was fully merged with and into CEPU on October 1, 2025. See “Item 4—Information of the Company—Recent
Developments—Simplification of Corporate Structure at Central Puerto S.A.”
In August 2018 and September 2018, respectively,
the La Castellana I and Achiras wind farms started operations. The original COD of the La Genoveva I was expected for May 2020, but due
to the outbreak of COVID-19, the construction of the plant was delayed. On November 21, 2020, La Genoveva I commenced full commercial
operations.
In addition, the former Ministry of Energy and
Mining established the regulatory framework that allows Large Users to purchase renewable energy from private generating companies and
the conditions for granting “dispatch priority” that allows such transactions to occur while ensuring that the private generating
companies will not be restricted in the future in its generation dispatch (see “Item 4.B. Business Overview—The Argentine
Electric Power Sector—Resolution No. 281-E/17: The Renewable Energy Term Market in Argentina”). In July 2019, September 2019,
December 2019, January 2020, March 2020, and February 2020, the wind farms La Castellana II (developed by CPR Energy Solutions S.A.U.),
La Genoveva II (developed by Vientos La Genoveva II S.A., currently known as Puerto Energías Renovables S.A.U.), Manque (CP Manque
S.A.U.), and Los Olivos (CP Los Olivos S.A.U.), respectively, reached their COD. As of the date of this annual report, we have entered
into long-term PPA contracts with private customers for 100.00% of the estimated energy generation capacity of our term market renewable
energy projects developed under Resolution No. 281-E/17 regulatory framework.
On October 18, 2023, our affiliate Proener acquired
100% of the capital stock and votes of Cordillera Solar and Scatec Equinor Solutions Argentina S.A., owner of a photovoltaic plant located
in the Province of San Juan.
Within the framework of Res. No. 281-E/17, we
made an offer to reserve capacity access to the electricity transportation network, in order to develop a solar farm with an installed
capacity of 15MW, located in the Province of Salta. In November 2025, we completed and started operations in the San Carlos solar
photovoltaic plant.
In August 2025
we completed the acquisition of the Cafayate solar photovoltaic plant, which is now fully operational. The facility has an installed capacity
of 80 MW and is located in the Province of Salta.
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Luján de Cuyo and San Lorenzo thermal
cogeneration plants
In 2017, the former Secretariat of Electric Energy
called for proposals for the supply of electric power to be generated through the installation of co-generation units. We submitted bids
on August 9, 2017, and on September 25, 2017, and we were awarded two co-generation projects: the San Lorenzo and the Luján de
Cuyo projects, which entailed two additional sources of income for us: (i) electric power sales to CAMMESA through 15-year term PPAs which
are priced in U.S. dollars; and (ii) steam sales pursuant to separate steam supply agreements negotiated with private offtakers.
On October 5, 2019, the Luján de Cuyo
cogeneration project started operations, with an installed capacity of 95 MW.
The San Lorenzo project reached its full COD
and obtained total commissioning of its combined cycle facility (391 MW) on August 15, 2021.
Purchase of the Brigadier Lopez Plant
On June 14, 2019, Central Puerto, through an
offer presented in a local and foreign public tender called by IEASA, purchased the Brigadier Lopez Plant. The transfer of ownership rights
in the Brigadier Lopez Plant included: (a) personal property, recordable personal property, facilities, machines, tools, spare parts,
and other assets used in connection with the operation of the Brigadier Lopez Plant; (b) IEASA’s contractual position in certain
existing contracts (including Turbogas and Turbosteam supplying contracts with CAMMESA and the Brigadier Lopez Financial Trust Agreement
(as defined below), among others); (c) permits and authorizations in effect related to the Brigadier Lopez Plant operation; and (d) employment
relationships with the then existing employees of the Brigadier Lopez Plant.
The Brigadier Lopez Plant has a Siemens dual-fuel
Siemens SGT5-4000 F gas turbine installed with a capacity of 281 MW. According to the tender specifications and conditions, the project
already included a boiler and a steam turbine, which complete the combined cycle. This setup has an installed capacity of 421 MW, increasing
the plant's capacity by 140 MW. Additionally, the steam turbine has a 10-year Power Purchase Agreement (PPA) with CAMMESA.
In February 2024, we entered into an agreement
with a constructor, Sociedad Argentina de Construcción y Desarrollo Estratégico, which set out all works, services,
and tasks required to complete the closure of the cycle. The “notice to proceed” under such agreement was delivered on February
26, 2024. As of December 31, 2025, the closure of the cycle was finalized and operational. In January 2026, commercial operations began
at the Brigadier Lopez’s combined cycle facility.
Acquisition of Participation Interests in
Enel Generación Costanera S.A. (currently, Central Costanera S.A.).
On February
17, 2023, our subsidiary Proener agreed to purchase from Enel Argentina S.A. a controlling interest in Enel Generación Costanera
S.A. (“CECO”) by acquiring all of Enel Argentina S.A.’s 531,273,928 shares with a par value of Ps.1 with one vote each,
representing 75.68% of the share capital of CECO, for a total value of US$48,000,000. As of December 31, 2025, CECO is 71.94% owned
by Proener S.A.U.
CECO’s thermal power plant, which is located
in the City of Buenos Aires, consists of four turbo-steam units with an installed capacity of 661 MW and two combined cycle power plants
with a capacity of 1,128 MW.
Foray into the Forestry Business
On December 27, 2022, Proener, an affiliate controlled
by Central Puerto S.A., acquired 100.00% of the capital stock and votes of Forestal Argentina S.A. (“Forestal Argentina”)
and Masisa Forestal S.A. (“Masisa Forestal”, currently Loma Alta Forestal S.A.).
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The acquisition from Masisa S.A. and Masisa Overseas
S.A. (collectively, "Masisa") encompassed both companies, representing approximately 72,000 hectares of land in the provinces
of Entre Ríos and Corrientes, of which approximately 43,000 hectares were planted with eucalyptus and pine trees. The aggregate
transaction price was US$69.4 million.
As a result of this transaction, Central Puerto
became one of the most significant Argentine-owned companies in the Argentine forestry industry, a market in which most participants are
owned by foreign investors. Central Puerto decided to make this acquisition as part of its strategy to invest in sectors in which Argentina
has a comparative advantage. Argentina has one of the highest forestry growth rates worldwide, with trees growing about ten times faster
than in the northern hemisphere. These factors have contributed to the forestry sector becoming one of the Argentine industries with significant
competitive advantages and strong growth potential. Participation in the forestry sector may also provide future business opportunities
related to carbon credits and biomass-based power generation.
On May 3, 2023, our affiliate
Proener also acquired 100% of the capital stock and votes of Empresas Verdes Argentina S.A., Las Misiones S.A. and Estancia Celina S.A.
These companies own forestry assets, consisting at the time of the acquisition of approximately 88,063 hectares of land in the province
of Corrientes. 26,000 of those hectares were planted with pine, out of a total of approximately 36,000 hectares available for planting.
The purchase price amounted to US$29,881,340.
Following the merger of the above-mentioned forestry
companies (see “Item 4—Information of the Company— Recent Developments – Simplification of Corporate Structure
at Central Puerto S.A.”), we currently hold our forestry interests through two subsidiaries: (a) Forestal Argentina S.A., which
owns approximately 141,000 hectares of land in the provinces of Entre Ríos and Corrientes, with a plantable area of approximately
77,500 hectares, of which approximately 67,000 hectares are planted with eucalyptus and pine; and (b) Loma Alta Forestal S.A., which owns
approximately 19,400 hectares of land in the province of Corrientes, of which approximately 10,400 hectares are planted with pine.
Foray into the Mining Business
On April 22, 2024, our subsidiary Proener
entered into a common shares subscription agreement with AbraSilver Resource Corp., a Canadian company listed in the Canadian stock market
("AbraSilver"), granting Proener a 4% interest in the share capital of AbraSilver, which is the owner of the silver-gold project
Diablillos located in the Northeast region of Argentina. In turn, and in conjunction with us, Kinross Gold Corporation, a major Canadian
mining company, (NYSE: KGC, TSX: K) also acquired a 4% interest on similar terms.
AbraSilver holds 100% ownership of the
Diablillos silver-gold project, situated in the provinces of Salta and Catamarca. The current proven resources and estimated mineral reserves
at Diablillos are 42.3 Mt with grades of 91 g/t Ag and 0.81 g/t Au, containing approximately 124 Moz of silver and 1.1 Moz of gold. The
funds from this subscription of shares were used, among other purposes, to conduct the feasibility and mineral resource study of the Diablillos
project, which was released in September 2025.
On January 31, 2025, our subsidiary Proener
signed a subscription agreement for additional shares of AbraSilver Resource Corp. Our shareholding in AbraSilver through Proener thus
increased to 9.9%.
Separately, on December 26, 2024, we subscribed
55,000,000 shares, equivalent to 27.5% of the share capital and voting rights of 3C Lithium Pte. Ltd., (a company incorporated under the
laws of Singapore), which holds 100% of the share capital of Minera Cordillera S.A., an Argentine company that holds the mining rights
to the "Tres Cruces" project, located in the province of Catamarca, Argentina.
On January 26, 2026, we acquired and
subscribed additional shares in 3C Lithium Pte. Ltd., increasing our ownership interest to 35% of the share capital of such company.
The Board of Directors of Minera Cordillera S.A. has already approved the 2026 business plan, which includes specific expenditures and
operating costs directly related to the development of the “Tres Cruces” project, including exploration activities, working
capital, general and administrative expenses, and legal or banking fees.
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Item 4.B Business Overview
Overview
Power Generation and Energy Sales
We are one of the largest private sector power
generation companies in Argentina, as measured by generated power, according to data from CAMMESA. In the year ended December 31, 2025,
we generated a total of 18,603 net GWh of power, representing approximately 13.02% of Argentina’s generation offer, according to
CAMMESA’s data. As of December 31, 2025, we had an installed capacity of 6,933 MW.
We have a generation asset portfolio that is
geographically and technologically diversified. Our facilities are distributed across the City of Buenos Aires and the provinces of Buenos
Aires, Córdoba, Mendoza, Neuquén, Río Negro, Santa Fe, San Juan and Salta. We use conventional and renewable technologies
(including hydro power) to generate power, and our power generation assets include combined cycle, gas turbine, steam turbine, co-generation,
hydroelectric, wind turbines and solar panels.
The following table presents a brief description
of the power plants we owned and operated as of December 31, 2025:
Power plant Location Installed capacity (MW) Technology
Puerto Nuevo(1) City of Buenos Aires 589.00 Steam turbines
Nuevo Puerto(1) City of Buenos Aires 360.00 Steam turbines
Puerto combined cycle(1) City of Buenos Aires 798.00 Combined cycle
Central Costanera(4) City of Buenos Aires 1,789.00 Combined cycle, Steam turbines
Luján de Cuyo plant Province of Mendoza 576.00 Steam turbines, gas turbines, two cycles and mini-hydro turbine generator, producing electric power and steam
Brigadier Lopez plant Province of Santa Fe 421.00 Combined cycle
San Lorenzo plant Province of Santa Fe 391.00 Combined cycle
Piedra del Águila plant Piedra del Águila (Limay River, bordering provinces of Neuquén and Río Negro) 1,440.00 Hydroelectric plant
La Castellana I wind farm(2) Province of Buenos Aires 101.00 Wind turbines
La Castellana II wind farm(2) Province of Buenos Aires 15.00 Wind turbines
La Genoveva I wind farm(2) Province of Buenos Aires 88.00 Wind turbines
La Genoveva II wind farm(2) Province of Buenos Aires 42.00 Wind turbines
Achiras wind farm(2) Province of Córdoba 48.00 Wind turbines
Manque wind farm(2) Province of Córdoba 57.00 Wind turbines
Los Olivos wind farm(2) Province of Córdoba 23.00 Wind turbines
Guañizuil II A(3) Province of San Juan 100.00 Solar panels
Cafayate(3) Province of Salta 80.00 Solar panels
San Carlos(2) Province of Salta 15.00 Solar panels
Total 6,933.00 MW
__________________
Notes:-
(1) The mentioned plants are included within the “Puerto Complex” as defined in “Business”.
(2) La Castellana I is owned by CP La Castellana S.A.U., La Castellana II , Manque, Los Olivos, La Genoveva II and the San Carlos solar farm are owned by Puerto Energías Renovables S.A.U. (formerly known as Vientos La Genoveva II S.A.U.) La Genoveva I is owned by Vientos La Genoveva S.A.U. Achiras wind farm is owned by CP Achiras S.A.U. As of December 31, 2025, CP La Castellana S.A.U., Puerto Energías Renovables S.A.U., Vientos La Genoveva S.A.U. and CP Achiras S.A.U. are all wholly-owned subsidiaries of Central Puerto S.A.
(3) PS Guañizuil II A solar farm is owned by CP Cordillera Solar S.A.U. which is a fully owned subsidiary of Central Puerto S.A. Cafayate solar farm is 99.99% owned by Central Puerto S.A. and 0.01% by Proener S.A.U. as of December 31, 2025.
(4) The Costanera complex is owned by Central Costanera S.A. which is 71.94% owned by Proener S.A.U., as of December 31, 2025. As of the date of this annual report, we own a 100% interest in Proener.
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In addition, our energy sales are channeled through
two arrangements known as the FONINVEMEM and the CVO Agreement, which are managed by CAMMESA at the instruction of the Secretariat of
Energy (for further information see “Item 4.B. Business Overview—FONINVEMEM and Similar Programs”). The Argentine Government
created the FONINVEMEM with the purpose of repaying power generation companies, like us, the existing receivables for electric power sales
between 2004 and 2011 and funding the expansion and development of new power capacity. As a result of our participation in the CVO arrangement,
we receive monthly payments for certain of our outstanding receivables with CAMMESA. Additionally, we have an equity interest in the companies
that operate the FONINVEMEM and CVO Agreement’s new combined cycle projects, which will be entitled to have an ownership interest
in the combined cycle projects.
During 2025 and 2024 we collected Ps.97.85 billion
and Ps. 110.06 billion from CVO receivables, respectively, in each case measured in Pesos as of December 31, 2025.
As of December 31, 2025, we held equity interests
in the companies that operate the following FONINVEMEM thermal power plants:
Power plant Operating Company Location Installed capacity (MW) Technology % Interest in the operating company
San Martin Termoeléctrica José de San Martín S.A. (TJSM) Timbúes, Province of Santa Fe 865.00 Combined cycle plant, which became operational in 2010 CEPU 9.63% CECO 1.68%
Manuel Belgrano Termoeléctrica Manuel Belgrano S.A. (TMB) Campana, Province of Buenos Aires 873.00 Combined cycle plant, which became operational in 2010 CEPU 10.83% CECO 1.89%
Vuelta de Obligado Central Vuelta de Obligado S.A. (CVOSA) Timbúes, Province of Santa Fe 847.00 Combined cycle plant, which became operational in March 2018 CEPU 54.59 CECO 1.30% %
__________________
Source:
Termoeléctrica Manuel Belgrano and CVOSA webpages
The following table breaks down the locations
of our plants and power investments in Argentina as of December 31, 2025, and their respective installed capacity:
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Power plant Technology Installed Capacity (MW) Location (Province) Initial Commercial Operating Date
Central Costanera Thermal (4 ST / 3 CC) 1,789 City of Buenos Aires 2023
Central Puerto Thermal (5 ST / 2 CC) 1,747 City of Buenos Aires 1992
Piedra del Águila Hydro 1,440 Río Negro 2026 (new concession term)
Luján de Cuyo Thermal 576 Mendoza 2019
San Lorenzo Thermal 391 Santa Fe 2021
Brigadier Lopez Thermal CC 421 Santa Fe 2019 and (combined cycle effective Jan 26)
Genoveva I Wind 88.2 Buenos Aires 2020
Genoveva II Wind 41.8 Buenos Aires 2020
La Castellana I Wind 100.8 Buenos Aires 2019
La Castellana II Wind 15.2 Buenos Aires 2020
Guañizuil II A Solar 100 San Juan 2023
Manque Wind 57 Córdoba 2020
Achiras I Wind 48 Córdoba 2020
Los Olivos Wind 22.8 Córdoba 2020
San Carlos Cafayate Solar Solar 15 80 Salta Salta 2025 2025
__________________
Source:
CAMMESA.
In the year ended December 31, 2025, we had revenues
of Ps. 1,097.42 billion. In the year ended December 31, 2025, we sold approximately 73.05% of our electric energy sales (in MWh) under
Spot Sales, including thermal and hydroelectric generation. Sales under Spot Sales accounted for 50.00% of our revenues in the year ended
December 31, 2025.
Until October
31, 2025, tariffs under the Spot Sales were paid by CAMMESA according to Res. No. 59/23, Res. No. 869/2023, Res. No. 9/2024, Res.
No. 99/2024, Res. No., 193/2024, Res. No. 233/2024, Res. No. 285/2024, Res. No. 20/2024, Res. No. 387/2024 and Res. No. 294/2024.
The remuneration scheme was based on a fixed and variable costs system which was determined by the Secretariat of Energy pursuant to Resolution
No. 95/13, as amended and complemented successively by Resolutions No. 602/2025, 483/2025, 381/25, 356/25, 331/25, 280/25, 227/25, 177/25,
143/25, 113/25, 27/25. Since November 1, 2025, Spot Sales are paid in accordance with Res. No. 400/25. This resolution outlines a gradual
roadmap to liberalize the WEM, progressively reintroducing long-term contracts, value creation and competitive dynamics.
Furthermore, this Resolution
purports to:
· Grant contract market optionality for spot thermal, where thermal generators gain significant flexibility, allowing them to trade capacity and energy in the new Thermal Term Market (MAT). Thermal generators can sell up to 20% of their production to Large Users and the remaining to distribution companies or the spot market.
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· Restore spot remuneration: The new spot remuneration mechanism establishes a margin on top of variable production costs, supporting long-term value creation for generators.
· Allow for Dollar-denominated revenues, reducing currency and inflation risk.
· Allocate fuel management responsibilities: The responsibility for fuel management is transferred from CAMMESA to the generators. CAMMESA will provide reference maximum fuel costs, and generators will report their variable production costs biweekly to ensure recovery of fuel expenses. During this transition, existing Plan Gas arrangements are expected to remain in place until December 2028 as a gas pool administered by CAMMESA, which will allocate this resource based on its supply and demand. Generators are required to subscribe to this pool for their natural gas needs until the Plan Gas program expires.
· Dispatch spot generators are dispatched in ascending order of variable production cost (CVP).
· Set a phased implementation plan: The transition will be managed through a phased approach. All existing power contracts will remain in force until their natural expiration, ensuring market continuity and stability during the transition.
Additionally, we have energy sales under
contracts, including (i) New MAT term market sales under contract, (ii) thermal Term market sales under contracts; (iii) renewables MATER
sales under contracts, and (iv) renewables sales of energy under the RenovAr Program.
The new MAT includes sales of electric power
under negotiated contracts with industrial users. The thermal term market includes sales under negotiated contracts with private large
users and public sector counterparties, as well as PPAs signed with CAMMESA and Energía Plus contracts. MATER sales consist of
electric power sold under negotiated contracts with private companies, generated exclusively from renewable energy plants. Renewable sales
under the RenovAr Program comprise 20-year PPAs signed with CAMMESA from the RenovAr bidding rounds No. 1, 1.5 and 2.
In all cases, sales under contracts generally
involve PPAs with customers and are contracted in U.S. dollars. Prices in term market sales under contracts from thermal units and Energía
Plus contracts include the price of the fuel used for generation, the cost of which is either assumed by the generator or charged to clients.
For terms longer than one year, these contracts typically include electric power price updating mechanisms in case of fuel price variations
or the generator being required to use liquid fuels in the event of a shortage of natural gas. For further information regarding our main
clients for term market sales under contract, see “Business—Our Customers”.
Term market sales under contract, and MATER and
RenovAr sales under contracts accounted for 26.95% of our electric power sales (in MWh) and 41.04% of our revenues for the year ended
December 31, 2025, respectively.
In our Luján de Cuyo plant, we are also
permitted to sell a minor portion (up to 16 MW) of our generation capacity and electric power under negotiated contracts with private
sector counterparties under the Energía Plus scheme, designed to encourage private sector investments in new generation facilities.
Under the rules and regulations of the Energía Plus scheme, the generator buys the fuel to cover the committed demand of electric
power and supplies the electric power to large electric power consumers at market prices, denominated in U.S. dollars, previously agreed
between the generator and its clients.
RenovAr sales under contracts include sales of
electricity generated exclusively from renewable energy power plants under negotiated contracts with public sector counterparties. We
have long-term contracts signed with CAMMESA. Prices under these PPAs are denominated in U.S. dollars and guaranteed by the FODER. In
the RenovAr Program, our subsidiaries, Achiras, La Castellana I, La Genoveva I, Cafayate, San Carlos and Cordillera Solar entered in a
20-year PPA with CAMMESA that establishes that 100% of the contracted generation capacity of the power plants will be sold to CAMMESA
at the awarded price plus the respective incentive and adjustment factors, which increase the awarded price approximately by 10.00% to
15.00%. See “Item 4.B, Business Overview—The Argentine Electric Power Sector —Structure of the Industry—Renewable
Energy Program”. See “Item 4.B. Business Overview—The Argentine Electric Power Sector”.
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Finally, we have income derived from the operating
fee that we receive for the management of the Central Vuelta de Obligado combined-cycle thermal power plant. Revenues from the management
of the Central Vuelta de Obligado plant accounted for 1.70% of our revenues for the year ended December 31, 2025.
The following graph breaks down our electric
energy sales in the year ended December 31, 2025, by regulatory framework:
Source: CAMMESA.
As for the renewed Piedra del Águila concession,
applicable rates and tariffs are defined in the document that started the national and international privatization public tender of the
Comahue hydro plants on August 22, 2025.
The key aspects of the new tariffs are:
· New energy and capacity prices: 1,733 US$/MW-month affected by maintenance hours and available capacity. Energy: 3.5 US$/MWh (when dispatched), 1.39 US$/MWh (available). The price doubles between 6:00 P.M and 11:00 P.M in December, January, February, June, July, and August.
· Optionality for sales under contract: Gradual increase in the capacity allowed for sales under contracts: 5% in 2026/2027, increasing by 5% every two years (10% in 2028/2029, etc.).
· Revenues denominated in U.S. Dollars and inflation indexes adjustment through annual revisions.
Expansion of Our Generating Capacity
The chart below shows the evolution of our power
generating capacity since 2018:
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__________________
Source: CAMMESA’s
seasonal programing.
Our installed capacity
significantly increased over the last three years and reached 6,933 MW as of December 31, 2025. Our increased installed capacity stems
from the completion of the construction of the San Carlos solar farm, in November 2025, and the completion of the closing of the Brigadier
Lopez combined cycle, in late 2025. Furthermore, our recent M&A initiatives (including the acquisition of the Cafayate solar farm,
in August 2025, the acquisition of Central Costanera, in February 2023, and the acquisition of the Guañizuil II A solar farm, in
October 2023) also had a positive impact on our aggregate installed capacity. In the year ended December 31, 2025, we were also awarded
two BESS projects which are still under development as of the date of this annual report. See Item 4 “Information of the Company—Recent
Developments—Strategic Growth Projects in our Renewable, Thermal and Hydroelectric Portfolio”.
We believe we are well-positioned to identify
and execute new growth opportunities. However, we cannot assure you that the Argentine Government will open new auction processes for
new and existing assets or that our bids will be successful or that we will be able to acquire additional assets or develop new projects,
or enter into new PPAs or private commercial contracts in the future. See “Item 3D. Risk Factors—Risks Relating to our Business—Factors
beyond our control may affect or delay the completion of the awarded projects or alter our plans for the expansion of our existing plants”.
Steam Generation and Sales
We also produce steam. As of December 31, 2025,
we had an installed capacity of 465 tons per hour: the San Lorenzo cogeneration plant had an installed capacity of 340 tons per hour while
the installed capacity of Luján de Cuyo plant was 125 tons per hour. Steam sales accounted for 4.72% of our revenues for the year
ended December 31, 2025. Our production of steam for the year ended December 31, 2025, was 3,386 thousand metric tons, of which 2,140
thousand metric tons were provided by the San Lorenzo plant and 1,246 thousand metric tons by the facilities installed in Luján
de Cuyo.
Our Luján de Cuyo plant supplies steam
under negotiated contracts with YPF while the San Lorenzo plant provides steam under a negotiated contract with T6 Industrial S.A. Our
Luján de Cuyo plant has a combined heat and power (CHP) unit in place, which started operations on October 5, 2019, replacing
the previous CHP, and supplies up to 125 metric tons per hour of steam to YPF’s refinery in Luján de Cuyo under a steam
supply agreement. This contract is denominated in U.S. dollars but can be adjusted in the event of variations in U.S. dollar-denominated
prices of fuel necessary for power generation. This new steam supply contract with YPF was entered into on December 15, 2017, for a period
of 15 years and replaced the contract in place with YPF. For further information on the steam supply agreements with YPF for the Luján
de Cuyo plant, see “Item 5.A. Operating Results—Factors Affecting Our Results of Operations—Sales Under Contracts,
Steam Sales and Others —Steam supply to YPF—Luján de Cuyo plant”.
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Gas Transportation
A contract between us and Transportadora de Gas
del Sur (“TGS”) concerning natural gas transportation capacity has remained effective since 2018. Pursuant to the terms of
our agreement with YPF EE, we resell our gas transportation capacity to YPF EE through the resale system established by Resolution ENARGAS
419/97. As of the date of this annual report, the delivery of the transportation capacity to YPF EE is done through the “Resale”
mechanism. The resale to YPF EE of our natural gas transportation capacity accounted for 0.81% of our revenues for the year ended December
31, 2025.
Natural Gas Transportation Expansion —
Open Season 2026
In late 2025 and early 2026, the Argentine natural
gas transportation system underwent a significant expansion process led by TGS. The expansion is structured under two simultaneous tenders:
Open Season GPM N° 01-2026, covering the Perito Moreno Pipeline, and Open Season TGS N° 01-2026, covering the existing regulated
system. The primary objective of the expansion is to increase evacuation capacity from the Neuquén Basin by approximately 14.0
million m³/d to Salliqueló and by approximately 12.0 million m³/d from Salliqueló to the Greater Buenos Aires
area. The process is governed by Res. No. 66/2026, which establishes the priority of allocation among shippers and the methodology for
calculating the base tariff, used to determine pre-payment amounts.
Forestry Industry
Finally, as a result of our acquisitions in the
forestry industry, carried out in December 2022 and May 2023, we have another source of revenues provided by our subsidiaries Forestal
Argentina S.A. (which merged with EVASA, Estancia Celina S.A. and Las Misiones S.A. in 2025) and Loma Alta Forestal S.A. These subsidiaries
as a whole generated 1.74% of our aggregate revenues for the year ended December 31, 2025.
The following graph breaks down our revenues
in the year ended December 31, 2025, by activity and/or regulatory framework:
__________________
Source: Central Puerto.
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The following graph breaks down the market
share of SADI’s key participants in terms of annual energy generation volumes:
_________________
Source: CAMMESA
Our Competitive Strengths
We believe that we have achieved a strong competitive
position in Argentina mainly as a result of our development in the power generation sector, which has allowed us to accomplish the following
strengths:
· The largest power generation company in Argentina in terms of generation and installed capacity. In the year ended December 31, 2025, we generated a total of 18,603 GWh of electricity and as of December 31, 2025, we had an installed generating capacity of 6,933 MW, as reported by CAMMESA. Our size, scalability, flexibility and strong operational, commercial and financial performance enable us to capture growth opportunities within the Argentine power generation market.
· High quality assets with strong operational performance. We have a variety of high-quality power generation assets, including combined cycle turbines, gas turbines, steam turbines, wind farms, solar panels, hydroelectric technology and steam and power co-generation technology, with a combined installed generating capacity of 6,933 MW, as of the date of this annual report. Our efficiency levels compare favorably to those of our competitors due to our efficient technologies. In the year ended December 31, 2025, the average generating availability of our thermal plant at the Central Puerto complex was 95.3% (combined cycle (CC) asset and 49.0% steam turbines (ST) and gas turbines (GT)), while the average availability of our thermal plants at the Central Costanera was 79.4% CC and 59.3% ST/GT, while the Lujan de Cuyo and San Lorenzo plants availability was, 93.6% and 96.9%, respectively.
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· Diversified, strategically located generation assets across multiple power sources. Our business is both geographically and technologically diverse. Our assets are critical to the Argentine electric power network due to the flexibility provided by the large fuel storage capacity, which allows us to store 72,000 tons of fuel oil (enough to cover 7.0 days of consumption) and 88,000 tons of gas oil (enough to cover 7.0 days of consumption) at our thermal generation plants, in addition to our access to deep water docks, our dam water capacity and our ability to store energy for 45 days operating at full capacity at Piedra del Águila. The prices for power transmission are regulated and based on the distance from the generating company to the user, among other factors. In this regard, our thermal power plants are strategically located in important city centers or near some of the system’s largest customers, which constitutes a significant competitive advantage. For example, according to the December 2025 monthly report prepared by CAMMESA, approximately 49.00% of Argentine energy consumption was concentrated within the greater Buenos Aires area during 2025, all of which underscores the strategic location of our Central Puerto and Central Costanera thermal complexes. In the year ended December 31, 2025, 96.3% of our thermal generation capacity relied on natural gas as fuel, while 1.2% relied on fuel oil and 2.5% relied on gas oil.
· Significant expansion of the current installed capacity and adequate financial position. We have taken steps to improve our strategic position as a leader among power generators by expanding and developing our thermal generation and renewable energy capacity, while maintaining our operating efficiency and a relatively low level of indebtedness. We benefit from an adequate financial position, allowing us to deliver on our business growth strategy and create value for our shareholders. In terms of our financial position, our total cash and cash equivalents and current other financial assets was Ps. 337.86 billion as of December 31, 2025 (US$231.50 million). Additionally, we believe our low indebtedness positions us to capitalize on growth opportunities in the energy sector. We believe this sector’s robust and resilient profile enables us to thrive in the energy transition era, strategically expand across diversified technologies, and capture opportunities across multiple industries.
· Strong positioning within the evolving deregulated power market and proven commercial capabilities. Res. No. 400/25, effective since November 2025, was a milestone in the liberalization of Argentina’s power generation market, introducing a new marginal pricing framework and aiming at progressively shifting the sector towards market autoregulation by 2030. We believe we are particularly well positioned to benefit from this regulatory shift due to its asset composition, operational flexibility and established commercial capabilities. The Central Puerto and Central Costanera complexes represent over 53% of our installed capacity corresponding to formerly spot-regulated thermal generation assets, rendering them two strategically positioned generation hubs with strong connectivity to the Argentine power grid and access to fuel supply infrastructure. Under Res. No. 400/25, the introduction of a marginalist dispatch model with energy prices set in U.S. dollars and linked to variable production costs enhances price transparency and aligns incentives for efficient operators like us. Our commercial and operational teams are well-experienced and have demonstrated their ability to adapt to fast-paced market dynamics, actively managing our portfolio to increase value in a competitive environment. In addition, the evolving regulatory framework governing hydroelectric concession renewals, including the updated pricing mechanisms set in U.S. dollars and with increasing exposure to private contracts sales, further supports a more market-oriented revenues structure. We believe that our diversified generation portfolio, combined with our experience operating under both regulated and competitive schemes, enable us to effectively manage regulatory transitions while maintaining operational reliability and financial discipline. We believe that our scale, asset quality, and commercial expertise provide a competitive advantage in building and managing a robust generation portfolio, enabling us to take advantage of market liberalization measures while reinforcing our position as a leading power generation company in Argentina.
· Strong cash flow generation supported by U.S. dollar-denominated revenues. A substantial portion of our revenues is denominated in U.S. dollars, primarily derived from (a) spot market sales, which have been U.S. dollar-denominated since late November 2025, (b) long-term PPAs with CAMMESA, (c) contracts entered into with large users and distribution companies for formerly spot thermal and hydro capacity, and (d) contracts entered into under the MATER and RenovAr regimes, as well as steam sales. These U.S. dollar-denominated revenue streams provide an improved hedge against local currency inflation and foreign exchange volatility, while long-term PPAs and contracted sales with large users enhance revenue visibility and cash flow predictability. Our revenues are diversified across spot sales, deregulated contracts, regulated contracts, private PPAs, and industrial steam sales, reducing reliance on any single remuneration mechanism. Payments under these arrangements are generally aligned with the current regulatory framework and market trends and principally depend on: (i) the availability of generation capacity, particularly in the case of thermal units, and (ii) the volume of electricity or steam generated and delivered. Our operational performance and track record support consistent capacity availability and dispatch performance, enabling Central Puerto to effectively convert operational performance into stable cash flow generation.
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· Solid and experienced management team with a successful track record in delivering growth. Our executive officers have vast experience and a long track record in corporate management with 20 years of experience in the industry on average. Our management has diverse experience navigating different business cycles, markets and sectors, as evidenced by the growth and expansion we have undergone since the early 1990s. Our management also has a proven track record in acquisitions and accessing financial markets and significant in-country know-how, with professionals who have taken an active role in project development and construction, developing private and public investment plans with both Argentine and international partners. In addition, our management team has business experience at the international and national level, are familiar with the operation of our assets in a constantly changing business environment and are strongly committed to our day-to-day decision-making process.
In the year ended December 31, 2025,
our management achieved significant milestones such as (a) adding 140 MW of thermal capacity through the closing of the Brigadier Lopez
combined cycle, (b) acquiring 80 MW of solar capacity through the acquisition of the Cafayate solar farm, (c) adding 15 MW of solar capacity
through the construction of the San Carlos solar farm, (d) securing contracts for two large-scale BESS projects, and (e) securing the
renewal of the Piedra del Aguila concession for a thirty-year term.
Our executive officers have a solid
understanding of Argentina’s historically volatile business environment. They have built and maintained mutually beneficial and
long-lasting relationships with a diversified group of suppliers and customers and have cultivated relationships with regulatory authorities.
· Strong corporate governance. We maintain robust corporate governance practices through our corporate governance code, which reflects best practices based on stringent standards of transparency, efficiency, ethics, investor protection and equitable treatment of all investors in accordance with guidelines established by the CNV. We have also adopted a code of ethics and an internal conduct code that establish guidelines for professional conduct, ethical behavior, and employee performance. In addition, a majority of our Board of Directors qualifies as “independent” in accordance with the criteria established by the CNV, which may differ from the independence criteria of the NYSE and NASDAQ.
Our Business Strategy
We seek to consolidate and grow our position
in the Argentine energy industry by maintaining our existing asset base and by acquiring and developing new assets related to the sector.
We decided to expand our businesses lines in those sectors in which Argentina has clear comparative advantages. The key components of
our strategy are as follows:
· Consolidating our leading position in the energy sector. We seek to consolidate our position in the energy sector by analyzing value-generating alternatives through investments with a balanced approach to profitability and risk exposure. We are committed to maintaining our high operating standards and availability levels. To this end, we follow a strict maintenance strategy for our units based on recommendations from their manufacturers, and we perform periodic preventive and predictive maintenance tasks. We plan to focus our efforts on optimizing our current resources from a business, administrative and technological perspective, in addition to capitalizing on operating synergies from the plants currently under construction that rely on similar systems, know-how, customers and suppliers.
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· Expanding renewable generation and energy storage technologies. During 2025, we continued to add renewable generation capacity. By the end of 2025, our solar and wind capacity represented 8.3% of our total installed capacity and 10.4% of our total electricity generation. Additionally, we added 95 MW of photovoltaic generation capacity through the acquisition of the Cafayate solar farm (80 MW) and the completion of the San Carlos solar farm (15 MW). In addition, in August 2025, we were awarded two BESS projects under long-term contracts, and initial works on such projects commenced shortly thereafter. Both projects are expected to be completed by mid-2027. The first project, located at the Central Puerto complex, is expected to have an installed capacity of 150 MW while the second project, located at the Central Costanera complex, is expected to have an installed capacity of 55 MW. We expect to continue expanding our portfolio of renewable generation and energy storage technologies (see Item 3D. Risk Factors—Risks Relating to our Business— Factors beyond our control may affect or delay the completion of the awarded projects or alter our plans for the expansion of our existing plants). Our subsidiary CP Renovables was responsible for developing, constructing and operating renewable energy generation projects. CP Renovables was fully merged with and into CEPU on October 1, 2025. See “Item 4—Information of the Company—Recent Developments – Simplification of Corporate Structure at Central Puerto S.A.”
· Maintaining an adequate financial position and sound cash flow levels. Our net leverage ratio has been consistently low, reflecting our adequate financial position and additional debt capacity, providing us with flexibility and competitiveness to leverage new business opportunities. We believe our adequate financial position is the result of our responsible financial policies and stable cash flows. We expect to expand our current cash flow levels in the coming years as a result of three substantial developments that occurred during 2025 (the closing of the Brigadier Lopez combined cycle, the completion of the construction of, and the initiation of the operations at, the San Carlos solar farm, and the acquisition of the Cafayate solar farm), the renewed hydro concession of Piedra del Águila and the new regulatory framework set forth by Res. No. 400/25. Additionally, we expect to further our rigorous maintenance programs for our production units, which we expect will help us continue the positive operational results we have experienced, particularly regarding our electric power dispatch availability. We intend to finance our expansion plans through market alternatives that enhance the return on capital of the projects, relying on loan agreements -such as credit facilities and project financing- and on the local and international capital markets. Each of CP La Castellana, CP Achiras, Vientos La Genoveva I, Vientos La Genoveva II (currently known as Puerto Energías Renovables S.A.U.), entered into long term loans to fund the development of renewable energy projects they were awarded and to purchase wind turbines. We also obtained a long-term loan from Kreditanstalt für Wiederaufbau (“KfW”) to support the construction of the Luján de Cuyo cogeneration project, and a loan from Citibank N.A., JP Morgan Chase Bank N.A. and Morgan Stanley Senior Funding INC. to purchase the Brigadier Lopez plant, which was fully paid on January 12, 2024. In August 2025, Central Puerto issued its Class “C” corporate bond in the Argentine market, raising US$89 million, bearing interest at a rate of 8.00% per annum, and maturing in 2029. In addition, on December 19, 2025, Central Puerto and the International Finance Corporation (“IFC”), entered into a financing agreement for a total amount of US$300 million to finance Central Puerto’s BESS projects and the renewal of the Piedra del Águila hydroelectric power plant concession. See “Item 5.A. Operating Results—Indebtedness”. We expect that the new capacity from these projects will allow us to further increase our cash flow, while enhancing our financial position.
Our Subsidiaries
Central Vuelta de Obligado S.A.
CVOSA is a private, unlisted company, engaged
in managing the purchase of equipment and building, operating and maintaining the CVOSA power plant that was constructed and began operations
on March 20, 2018, under a program substantially similar to the FONINVEMEM program.
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We have 54.59% of the voting rights in CVOSA
(while Central Costanera owns an additional 1.30% ownership interest), which grants us the power to unilaterally approve resolutions
for which a majority is required at the relevant shareholders’ meetings. However, pursuant to a shareholders’ agreement entered
into among Hidroeléctrica El Chocón S.A., Central Dock Sud S.A. and Central Costanera S.A (the “Other CVOSA Shareholders”)
and us, we will only be able to approve the following decisions with the affirmative vote of the Other CVOSA Shareholders: (i) entering
into a merger, spin-off, transformation or liquidation; (ii) increasing or decreasing the capital stock; (iii) receiving capital contributions;
(iv) entering into transactions with related parties; (v) amending the bylaws; (vi) entering into an operating and maintenance agreement
for the Vuelta de Obligado power plant; (vii) approving the trust agreement in connection with the Vuelta de Obligado power plant and
its amendments; (viii) filing any lawsuit against any governmental authorities, CAMMESA and/or the FONINVEMEM trust fund currently holding
the Vuelta de Obligado power plant; (ix) entering into engineering services, gas supply and transportation agreements; and (x) entering
into a power purchase agreement with CAMMESA for the Vuelta de Obligado power plant. If such decisions are to be decided at a board of
directors’ meeting, they can only be approved with the affirmative vote of at least one member of the board of directors appointed
by the Other CVOSA Shareholders.
The board of directors of CVOSA is currently
composed by four members, two of which (the current chairman and vice-chairman of the board) have been appointed by us. In addition, we
have the right to appoint the chairman of the board of directors of CVOSA, who has double vote in case of a tie. In addition, we have
the right to appoint one member of the supervisory committee of CVOSA.
Pursuant to the terms of the FONINVEMEM agreement
relating to the Vuelta de Obligado power plant, on the tenth anniversary of the start of operations of the Vuelta de Obligado power plant,
which occurred on March 20, 2018, all governmental entities that financed the construction of the Vuelta de Obligado power plant have
the right to be incorporated as shareholders of CVOSA, which in turn may dilute our interest in CVOSA. If such dilution were to occur,
we may no longer control CVOSA.
Proener S.A.U.
Proener S.A.U. is a private, unlisted company.
We hold a 100.00% interest in Proener S.A.U., a company engaged in investment activities in the energy and forestry sectors.
CP Renovables S.A.
In 2016, we formed a subsidiary,
CP Renovables S.A. (“CP Renovables”), to develop, construct and operate renewable energy generation projects.
On March 31, 2025, CEPU
and CP Renovables’ Boards of Directors approved a corporate reorganization whereby CEPU would absorb the entirety of CP Renovables’
assets and liabilities, thereby assuming ownership of all assets, liabilities, rights, and obligations of CP Renovables as of the effective
date of the merger.
On June 17, 2025, Central
Puerto and CP Renovables entered into a definitive merger agreement. The merger became effective on October 1, 2025, at which time
Central Puerto received all of the assets and assumed all of the liabilities of CP Renovables. Following the merger, CP Renovables was
dissolved without liquidation, as Central Puerto directly and indirectly owns 100% of the shares of CP Renovables.
CP Achiras S.A.U.
CP Achiras S.A.U. is a private, unlisted company.
As of December 31, 2025, we held a 100.00% interest in the capital stock of CP Achiras S.A.U., a company engaged in the generation and
commercialization of electric power through renewable sources.
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Puerto Energías Renovables
S.A.U. (formerly known as Vientos La Genoveva II S.A.)
Puerto Energías Renovables S.A.U. (formerly
Vientos La Genoveva II S.A.) is a private, unlisted company, engaged in generation and commercialization of electric power through renewable
sources. As of December 31, 2025, we held a 100.00% interest in the capital stock of Puerto Energías Renovables S.A.U.
Effective January 1, 2025, Vientos La Genoveva
II S.A. merged with our subsidiaries, CP Manque S.A.U., CP Los Olivos S.A.U. and CPR Energy Solutions S.A.U., being Vientos la Genoveva
II S.A. the continuing company, whose legal form was converted to a corporation (sociedad anónima) under Argentine law.
See “Item 4. Information of the Company— Recent Developments—Simplification of Corporate Structure at Central Puerto
S.A.”
CP La Castellana S.A.U.
CP La Castellana is a private, unlisted company.
As of December 31, 2025, we held a 100.00% interest in the capital stock of CP La Castellana, a company engaged in generation and commercialization
of electric power through renewable sources.
Vientos La Genoveva S.A.U.
Vientos La Genoveva S.A.U. is a private, unlisted
company. On March 7, 2018, our former subsidiary CP Renovables S.A. acquired 100% of the equity interests in Vientos La Genoveva S.A.,
a company engaged in generation and commercialization of electric power through renewable sources. As of December 31, 2025, we held a
100.00% interest in the capital stock of Vientos La Genoveva S.A.U.
Forestal Argentina S.A.
Forestal Argentina S.A. is a private, unlisted
company. Our subsidiary Proener holds a 96.48% interest while Central Puerto S.A. holds 3.52% of the capital stock of Forestal Argentina
S.A., a company engaged in the production and commercialization of forestry assets.
On March 31, 2025, the
Board of Directors of Empresas Verdes Argentina S.A. (EVASA), Forestal Argentina S.A. (FASA), Estancia Celina S.A. (ECSA) and Las Misiones
S.A. (LMSA) approved the corporate reorganization whereby EVASA would absorb the entirety of EVASA, FASA, ECSA and LMSA’s assets
and liabilities, thereby assuming ownership of all assets, liabilities, rights, and obligations of such companies as of the effective
date of the merger. The merger became effective on June 30, 2025, after which the legal name of EVASA was changed to Forestal Argentina
S.A. “Item 4. Information of the Company—Recent Developments— Simplification of Corporate Structure at Central Puerto
S.A.”
Loma Alta Forestal S.A.
Loma Alta Forestal S.A. is a private, unlisted
company. Our subsidiary Proener holds a 98.00% interest while we hold a 2.00% interest in the capital stock of Loma Alta Forestal S.A.,
a company engaged in the production and commercialization of forestry assets.
Central Costanera S.A.
Central Costanera S.A. is a public, listed company
on BYMA that is 71.94% owned by Proener as of December 31, 2025 and is engaged in the production and commercialization of electric energy.
CP Cordillera Solar S.A.U (formerly known
as Cordillera Solar VIII S.A.)
Cordillera Solar is a private, unlisted company
which owns the Guañizuil IIA photovoltaic plant located in the Province of San Juan. As of December 31, 2025, we held a 100.00%
interest in the capital stock of Cordillera Solar S.A.U.
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CP Servicios Renovables S.A.U. (formerly
known as Scatec Equinor Solutions Argentina S.A.)
CP Servicios Renovables S.A.U. is a private,
unlisted company, that owns the Guañizuil IIA photovoltaic plant located in the Province of San Juan. As of December 31, 2025,
we held a 100.00% interest in the capital stock of CP Servicios Renovables S.A.U.
PS Cafayate S.R.L.
PS Cafayate S.R.L. is a private, unlisted company
which operates the Cafayate solar farm. As of December 31, 2025, we held a 99.99% interest in PS Cafayate S.R.L., while Proener held the
remaining 0.01%.
Puerto Energía S.A.U.
Puerto Energía S.A.U. is a private, unlisted
company, authorized to participate as energy trader in the WEM. As of December 31, 2025, we held a 100.00% interest in Puerto Energía
S.A.U.
Piedra del Águila Hidroeléctrica
Argentina S.A.
Piedra del Águila Hidroeléctrica
Argentina S.A. is a private, unlisted company that holds the concession to operate the HPDA hydroelectric complex. On January 9, 2026,
we acquired 100% of the share capital of Piedra del Águila Hidroeléctrica Argentina S.A. as the successful bidders in a
national and international public tender conducted by the Argentine Minister of Economy.
Our Affiliates
Termoeléctrica José de San
Martín S.A. (TJSM) and Termoeléctrica Manuel Belgrano S.A. (TMB)
TJSM and TMB are private, unlisted companies,
which are engaged in managing the purchase of equipment, and building, operating and maintaining the San Martín and Belgrano power
plants, respectively, each constructed under the FONINVEMEM program.
As of December 31, 2025, we had 11.31% of the
voting rights in TJSM and 12.72% of the voting rights in TMB.
The board of directors of each of TJSM and TMB
consists of nine members.
After ten years of operations, TJSM and TMB were
entitled to receive property rights to the San Martín and Belgrano power plants from the trusts holding ownership interests in
them. At such time, the term of the trusts would expire and the Argentine Government, that financed part of the construction, had to be
incorporated as a shareholder of TJSM and TMB. Consequently, our interests in TJSM and TMB were diluted in 2021. In the case of TMB and
TJSM, the ten-year period expired on January 7, 2020, and on February 2, 2020, respectively. From such dates, during the following 90-day
period, TJSM and TMB and their shareholders had to perform all the necessary acts to grant the Argentine Government the corresponding
shares in the equity stake of TJSM and TMB that their contributions entitle the Argentine Government to receive.
On January 3, 2020, before the aforementioned
90-day period commenced, the Argentine Government sent a notice to us (doing the same with TSM, TMB and other generation companies that
are shareholders of TJSM and TMB) stating that, in accordance with the FONINVEMEM Agreement, TJSM and TMB should perform all necessary
acts to incorporate the Argentine Government as shareholder of both companies, claiming, in each case, the following equity interest rights:
65.006% in TMB and 68.826% in TJSM.
On January 9, 2020, we, together with the other
generation companies, shareholders of TJSM and TMB, replied to such notice stating that the Argentine Government’s equity interest
claims did not correspond with the contributions that the Argentine Government made for the construction of the power plants under the
terms of the FONINVEMEM Agreement. On March 4, 2020, the Argentine Government reiterated its previous claim to us.
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Additionally, on January 7, 2020 and on January
9, 2020, Central Puerto, together with the other shareholders of TJSM and TMB, Banco de Inversión y Comercio Exterior (“BICE”),
TJSM, TMB and the Energy Secretariat, amended the Operation and Maintenance Agreement of the Manuel Belgrano Thermal Facility (the “TMB
OMA”) and the Operation and Maintenance Agreement of the San Martín Thermal Facility ( the “TJSM OMA”). The amendments
to the TMB OMA and TJSM OMA extended the agreements until each of the trust’s liquidation effective date.
In March 2020, Central Puerto filed an administrative
appeal against the Argentine Government challenging the acts referred to above (the “Claim”). In the Claim, the shareholders
of TJSM and TMB do not contest the inclusion of the Argentine Government as a shareholder in those companies but nevertheless assert that
its equity interest in each company should be lower than the percentages claimed by the Argentine Government. As a result, even if the
Claim is successful, our equity interests in TJSM and TMB would remain significantly diluted.
On May 4, 2020, and May 8, 2020, the extraordinary
shareholders’ meetings of TMB and TJSM, respectively, approved the incorporation of the Argentine Government as shareholder of TJSM
and TMB. In each of the extraordinary shareholders’ meetings, the approved equity interest that was approved was the equity interest
that the Argentine Government claims that it is entitled to, which is: 65.006% in TMB and 68.826% in TJSM.
In each of the shareholders’ meetings,
Central Puerto (and other shareholders), made the corresponding reservation of rights to continue with the Claim, and expressly stated
that the incorporation of the Argentine Government as a shareholder in TMB and TJSM was approved for the sole purpose of achieving the
transfer of the trust assets -which include, among others, the power plants- from the respective trusts to TJSM and TMB.
On March 11, 2021, the Argentine Government subscribed
its shares and the equity of the shareholders of TJSM and TMB were diluted. In our case, our equity interests were diluted from 30.875%
to 9.627% in TJSM and from 30.946% to 10.831% in TMB.
Due to the acquisition of Central Costanera S.A.,
we hold equity interests of 11.31% in TJSM, 12.72% in TMB and 54.59% in CVOSA. As of the date of this annual report, the transfer of the
power stations to TSM and TMB was not completed. See “Item 3D. Risk Factors—Risks Relating to our Business—Our interests
in TJSM, TMB were diluted and CVOSA will be significantly diluted”.
In the case of CVOSA, when the CVO Trust term
expires after ten years of operation of the respective power plant, the Argentine Government will be incorporated as shareholder, with
a stake of at least 70.00% pursuant to FONINVEMEM arrangements for CVOSA. The dilution of our interest in CVOSA will reduce our income
from this power plant, adversely affecting our results of operations. See “Item 4.B. Business Overview—FONINVEMEM and Similar
Programs”.
Ecogas Inversiones S.A.
On October
1, 2025, following receipt of the required authorizations from the CNV and the BCBA, and pursuant to the approvals granted by the extraordinary
shareholders’ meetings of Central Puerto and Ecogas held on May 22, 2025, Central Puerto completed its previously announced
spin-off and merger transaction with Ecogas, in accordance with the definitive corporate reorganization agreement executed on June 17,
2025.
Under
this spin-off and merger transaction, CEPU transferred to Ecogas certain equity interests and Ps.305 million in cash, and Ecogas issued
80,973,264 new Class D common shares to CEPU shareholders on a pro rata basis, using September 26, 2025 as record date and an exchange
ratio of one Ecogas share for every 18.6694 CEPU shares, with cash paid in lieu of fractional shares. Following the transaction, Ecogas
increased its share capital and continued as the surviving entity holding the spun-off assets, while CEPU continued to operate its electricity
generation business.
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CEPU
shareholders in Argentina, as well as holders of CEPU American Depositary Receipts, received the corresponding Ecogas securities on October
1, 2025.
Transportadora de Gas del Mercosur S.A.
(TGM)
TGM is a private, unlisted company. We hold a
20.00% interest in the capital stock of TGM, which owns a natural gas pipeline extending from Aldea Brasilera (in the Province of Entre
Rios) to Paso de los Libres (in the Province of Corrientes).
The remaining 80.00% is owned by Total Gas y
Electricidad Argentina S.A. (32.68%), Tecpetrol S.A. (21.79%), RPM Gas S.A. (14.63%) and Compañía General de Combustibles
S.A. (10.90%).
The pipeline is approximately 450 km long and
its transportation capacity reaches up to 15 million cubic meters per day.
3C Lithium Pte. Ltd.
On December 26, 2024, we subscribed 55,000,000
shares, equivalent to 27.5% of the share capital and voting rights of 3C Lithium Pte. Ltd. ("3C"), (a company incorporated under
the laws of Singapore), which holds 100% of the share capital of Minera Cordillera S.A., an Argentine company that holds the mining rights
to the "Tres Cruces" project, located in the province of Catamarca, Argentina.
On January 26, 2026, we acquired and subscribed
additional shares in 3C Lithium Pte. Ltd., increasing our ownership interest to 35% of the share capital of such company.
Piedra del Águila
Hidroeléctrica Argentina S.A
On January 9, 2026, Central Puerto acquired 100%
of the share capital of Piedra del Águila Hidroeléctrica Argentina S.A. as the successful bidder in a national and international
public tender conducted by the Argentine Ministry of Economy. Piedra del Águila Hidroeléctrica Argentina S.A. holds the
concession to operate the HPDA hydroelectric complex. The purchase price for the shares was US$245 million and was paid on January 5 and
January 6, 2026, while CEPU took over the concession on January 9, 2026. CEPU currently retains full operational control of the asset
until 2055.
Business Overview
All of our operations in the power generation
sector are concentrated in sixteen plants in Argentina, and our portfolio can be divided into two types of electric power generation plants:
(i) electric power generation from conventional sources and (ii) electric power generation from renewable sources.
The table below details certain operating features
regarding our power generation assets for the periods indicated:
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For the year ended December 31,
2025 2024 2023
Generation—GWh/year
Puerto Complex 4,936 5,109 5,371
Costanera Complex(4) 3,947 4,638 3,367
Luján de Cuyo plant 2,563 3,376 3,138
Brigadier Lopez plant 59 95 67
San Lorenzo plant 2,484 2,263 2,037
Piedra del Águila plant 2,683 4,348 5,173
La Castellana I wind farm(2) 398 372 398
La Castellana II wind farm(2) 68 46 70
Achiras wind farm(2) 195 186 188
Manque wind farm(2) 255 254 238
Olivos wind farm(2) 107 106 99
La Genoveva I wind farm(2) 369 360 378
La Genoveva II wind farm(2) 175 171 177
PS Guañizuil II A(3) 275 281 73
Cafayate solar farm 84 0 0
San Carlos solar farm 5.5 0 0
Total 18,603 21,605 20,774
Sales under Spot Sales and electric power sales on the spot market—GWh/year
Puerto Complex 4,036 5,109 5,371
Costanera Complex(4) 3,947 4,638 3,367
Luján de Cuyo plant 1,672 2,284 2,489
Brigadier Lopez plant 59 95 69
San Lorenzo plant 293 32 41
Piedra del Águila plant 2,683 4,348 5,174
La Castellana I wind farm(2) — — —
La Castellana II wind farm(2) — — —
Achiras wind farm(2) — — —
Manque wind farm(2) — 4 —
Olivos wind farm(2) — 2 —
La Genoveva I wind farm(2) — — —
La Genoveva II wind farm(2) — — —
PS Guañizuil II A(3) — — —
Total 12,690 16,512 16,511
Sales under contracts and Power Purchase Agreements—GWh/year
Puerto Complex — — —
Costanera Complex(4) — — —
Luján de Cuyo plant 891 698 641
Brigadier Lopez plant — — —
San Lorenzo plant 2,192 2,013 1,987
Piedra del Águila plant — — —
La Castellana I wind farm(2) 68 340 398
La Castellana II wind farm(2) 195 43 70
Achiras wind farm(2) 255 169 188
Manque wind farm(2) 107 225 245
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For the year ended December 31,
2025 2024 2023
La Genoveva II wind farm(2) 369 166 378
Olivos wind farm(2) 175 88 177
La Genoveva I wind farm(2) 275 331 92
PS Guañizuil II A(3) 84 256 73
San Carlos solar farm(2) 5.5 — —
Total 4,616 4,329 4,249
Energy purchases—GWh/year
Puerto Complex 40 32 49
Costanera Complex(4) 62 64 66
Luján de Cuyo plant 11 11 11
Brigadier Lopez plant — — —
San Lorenzo plant 0.5 2 3
Piedra del Águila plant 0.01 — —
La Castellana I wind farm(2) 0.5 — 1
La Castellana II wind farm(2) — — —
Achiras wind farm(2) 0.2 — —
Manque wind farm(2) — — —
La Genoveva II wind farm(2) 0.5 — —
Olivos wind farm(2) — — —
La Genoveva I wind farm(2) 0.3 — —
PS Guañizuil II A(3) 1.3 2 —
Cafayate solar farm 0.4 — —
Total 117 111 130
Steam production (metric tons/year)
Luján de Cuyo plant 1,246,057 1,164,375 928,381
San Lorenzo plant 2,140,111 1,777,811 1,089,509
Total 3,386,168 2,942,186 2,017,890
Natural gas consumption—MMm3/year
Puerto Complex 884 999 876
Costanera Complex(4) 696 929 902
Luján de Cuyo plant 429 644 660
Brigadier Lopez plant 10 12 1
San Lorenzo plant 377 288 274
Total 2,396 2,872 2,713
Gas oil consumption—thousands of m3/year
Puerto Complex 29 62 44
Costanera Complex(4) 3 1 10
Luján de Cuyo plant — — —
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For the year ended December 31,
2025 2024 2023
Brigadier Lopez plant 3 15 19
San Lorenzo plant 38 87 105
Total 73 165 178
Fuel oil consumption—thousands of tons/year
Puerto Complex 37 104 278
Costanera Complex(4) 10 21 52
Luján de Cuyo plant — 8 4
Brigadier Lopez plant — — —
San Lorenzo plant — — —
Total 47 133 334
Availability—% per year(1)
Puerto Complex 70 % 73 % 75 %
Costanera Complex(4) 74 % 70 % 43
Luján de Cuyo plant 94 % 88 % 89 %
Brigadier Lopez plant 86 % 97 % 93 %
Piedra del Águila plant 98 % 98 % 98 %
San Lorenzo plant 97 % 99 % 99 %
Weighted average for thermal units(1) 84 % 90 % 66 %
Weighted average for thermal and hydro plants(1) 86 % 98 % 73 %
_____________
Source: CAMMESA
Notes:-
(1) Weighted average based on the power capacity of each unit without considering renewable energy units, which do not receive payments tied to their availability.
(2) La Castellana I is owned by CP La Castellana S.A.U., La Castellana II , Manque, Los Olivos, La Genoveva II and the San Carlos solar farm are owned by Puerto Energías Renovables S.A.U. (formerly known as Vientos La Genoveva II S.A.U.) La Genoveva I is owned by Vientos La Genoveva S.A.U. Achiras wind farm is owned by CP Achiras S.A.U. As of December 31, 2025, CP La Castellana S.A.U., Puerto Energías Renovables S.A.U., Vientos La Genoveva S.A.U. and CP Achiras S.A.U. were all wholly-owned subsidiaries of Central Puerto S.A.
(3) PS Guañizuil II A solar farm is owned by CP Cordillera Solar S.A.U. which is a fully owned subsidiary of Central Puerto S.A. Cafayate solar farm is 99.99% owned by Central Puerto S.A. and 0.01% by Proener S.A.U. as of December 31, 2025.
(4) The Costanera complex is owned by Central Costanera S.A. which is 71.94% owned by Proener S.A.U., as of December 31, 2025. As of the date of this annual report, we own a 100% interest in Proener.
See “Item
4.B. Business Overview—Our Subsidiaries”.
The table below shows the average availability
rates of Central Puerto’s combined thermal plants in the year ended December 31, 2025:
__________________
Source: Central
Puerto, CAMMESA.
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The following graph shows the evolution of Central
Puerto’s electric power generation for the period 2021-2025:
__________
Source: CAMMESA.
Electricity Generation from our Thermal Generation
Plants
As of December 31, 2025, we owned five thermal
generation plants and complexes: the Central Puerto Complex, the Costanera Complex, Brigadier Lopez, Luján de Cuyo and San Lorenzo.
Central Puerto Complex
Our Central Puerto Complex is composed of two
facilities, Nuevo Puerto, including the Puerto combined cycle plant, and Puerto Nuevo (collectively, the “Central Puerto Complex”),
located in the port of the City of Buenos Aires on the bank of the Río de la Plata. The two facilities are close to one another
inside a complex of 246,475 square meters with a total installed capacity of 1,747 MW. Nuevo Puerto’s facilities (which includes
both the Nuevo Puerto plant and the Puerto combined cycle plant) has 70,518 square meters. Puerto Nuevo has approximately 92,370 square
meters.
Nuevo Puerto’s facilities were completed
in 1926 and Puerto Nuevo’s facilities were completed in 1930. The two facilities were merged into a single company in the 1980s
within SEGBA, which was later converted to Central Puerto after its privatization in 1992.
Nuevo Puerto is located at Av. Thomas Edison
2001/2151 in the City of Buenos Aires in the northern part of the complex and has two conventional steam turbine generator sets (steam
turbine units 5 and 6). The plant can run on natural gas and fuel oil and has a current installed capacity of 360 MW.
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The Central Puerto Complex combined cycle plant
was built at Nuevo Puerto’s facilities and commenced commercial operations in 2000. The Central Puerto Complex combined cycle plant
has an installed capacity of 798 MW and is composed of two General Electric 9FA gas turbines, two heat recovery steam generators and a
General Electric D11 steam turbine. The Puerto combined cycle plant is one of the most modern and efficient plants in Argentina and can
run on natural gas, gas oil and a blend of up to 20.00% gas oil and biodiesel when running on liquid fuel.
Puerto Nuevo is located at Av. Thomas Edison
2701 in the City of Buenos Aires in the southern part of the complex and has three conventional steam turbine generator sets (steam turbine
units 7, 8 and 9). The plant is capable of running on natural gas and fuel oil and has an installed capacity of 589 MW.
Technology. The steam turbine generators
at both facilities include turbines with high, medium and low-pressure stages that run on superheated steam from a dedicated conventional
heat generator. The steam turbine generator works on a cycle. Water flows towards a heat generator that creates steam. The expansion of
the steam makes the turbine rotate, triggering an electric power producing generator. Once the steam has been used in the turbine, it
is collected in condensers where it returns to its liquid form, and the water flows again towards the heat generator to produce more steam
and feed the turbine again.
The combined cycle technology is one of the most
efficient fossil fuel-based electric power generation technologies. It works by feeding each gas turbine with a mix of fuel and air. The
gas that is produced from this process expands rapidly due to combustion and the generator and turbine ultimately convert the resulting
rotational energy into electric power. The exhaust gas from each turbine is collected and channeled to a heat recovery steam generator
that uses the heat energy contained in the gas turbine exhaust gas to produce steam. The steam that is produced is injected into a steam
turbine where it expands and transmits energy to the turbine, which converts the energy into electric power through a generator. Similar
to a conventional steam turbine, the steam is condensed and sent back to the circuit to produce more steam.
Location. The Puerto Complex is located
inside the port of the City of Buenos Aires and has a right-of-way to use the port facilities, allowing it to receive and store fuel on
a large scale. The liquid fuel (gas oil, fuel oil and biodiesel) is delivered by ships that dock near the premises, where the fuel is
directly unloaded at the complex. To provide operating flexibility, the Puerto Nuevo and Nuevo Puerto facilities have underground connection
systems, which are used to move fuel between plants based on each plant’s delivery needs.
The Puerto Complex’s location on the bank
of the Río de la Plata is also convenient in terms of water supply, which is a basic input for our plants. Water is integral both
for creating steam and cooling the generation units. Puerto Nuevo and Nuevo Puerto have water treatment facilities that are capable of
taking water from the river and delivering it at the quality required for each stage of the electric power generation process.
We currently own the property where the Nuevo
Puerto, Puerto combined cycle and Puerto Nuevo plants are located.
Supply. The electric power produced at
each plant is delivered to the SADI through a transformer belonging to our generation units. The transformer adjusts the generator output
voltage to the voltage required by the network. The electric power is delivered at 132 KV sub-stations neighboring the plants, which are
currently operated by Edenor S.A. (the holder of the electric power distribution concession in the area where the Puerto Complex is located).
Costanera Complex
Our Central Costanera complex has 1,789 MW of
installed capacity. This capacity is comprised of four Steam Turbine units totaling around 661 MW (including i. three British Thomson-Houston
- BTH - units, each approximately 120 MW, operational since the 1960s, and ii. one 310 MW LMZ unit from 1984), with the option of being
fueled by both natural gas and fuel oil.
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The Central Costanera complex commenced operations
in 1963, and is strategically located in the southern area of the port of the Autonomous City of Buenos Aires, adjacent to the Río
de la Plata. This positioning allows a significant flexibility in fuel supply, and also a key proximity to the country’s major electricity
consumption center, the Greater Buenos Aires area.
Additionally, it features two high-efficiency
combined cycles, a Siemens unit of approximately 277 MW, which was Argentina's first combined cycle, built during 1995-1996, and a Mitsubishi
unit of 851 MW, capable of operating with either natural gas or gas oil, commissioned in 1999. In May 2024 units COSTTV04 (120 MW) and
COSTTV06 (350 MW), were officially decommissioned through Resolution 57/2024, following a request originally made by Enel, former owner
of such power plant. This decision had no impact on revenues.
Central Costanera injects its energy into the
SADI via connections at 132kv and 220kv, facilitated by a transformer station operated by EDESUR.
Luján de Cuyo Plant
The Luján de Cuyo plant is located in
Luján de Cuyo, Mendoza and has an installed capacity of 576 MW. The plant began operating in 1971, and has eleven generating units,
seven gas turbines, three steam turbines and a mini-hydroelectric turbine (which began operating in 2013). The plant has a total installed
capacity of 576 MW.
The premises on which the Luján de Cuyo
plant is located are on the banks of the Mendoza River, a major river in the Province of Mendoza. The Luján de Cuyo plant’s
access to water from the Mendoza River provides it with a source of water to supply the generation process and to cool the condensers.
The facility has a water treatment plant with production levels suitable to meet its requirements.
The main generator is a highly efficient combined
cycle unit composed of a Siemens gas turbine (TG25) and a Sköda steam turbine (TV15).
The plant also has a combined heat and power
(CHP) unit in place, which commenced operations on October 5, 2019. This unit supplies up to 125 tons per hour of steam to YPF’s
refinery in Luján de Cuyo under a steam provision contract. The plant has two Siemens gas turbines (TG26 and TG27) and two heat
recovery steam generators. The steam flows into YPF’s facilities through a steam duct that connects the plant to the refinery. Both
gas turbines can operate on natural gas or gas oil.
In 2018, we acquired two Siemens gas turbines
with a combined capacity of 46 MW. These turbines commenced commercial operations in October 2019. We also participated in competitive
bidding processes for electric capacity and were awarded 93 MW for winter periods and 89 MW for summer periods.
The Luján de Cuyo plant also has two Alstom-branded
Frame5-type gas turbines (TG23 and TG24). Prior to the commencement of operation of units TG26 and TG 27 described above, TG23 and TG24
supplied steam to the YPF Luján de Cuyo refinery in a combined heat and power (cogeneration) configuration. On October 5, 2019,
TG23 and TG24 were set up to work in an open cycle configuration. Both gas turbines can operate on natural gas or gas oil.
The Luján de Cuyo plant also had an ABB
combined cycle unit in place composed of one gas turbine (TG22), which operates on natural gas or gas oil, or on blends of gas oil and
biodiesel (up to 30%).
The electric power generated by the units installed
in the Luján de Cuyo plant is delivered to the SADI through a connection between the network and the Luján de Cuyo 132 KV
sub-station, which is adjacent to the plant. The sub-station is operated by Distrocuyo, an operator of the trunk pipeline system from
the Cuyo region. Steam is delivered to YPF pursuant to separate contract through a short pipeline that connects our Luján de Cuyo
plant with YPF’s adjacent Luján de Cuyo refinery.
Because the Luján de Cuyo plant is land-locked,
liquid fuels must be transported by land, typically by truck. To accommodate the fuel supply chain, the plant has an unloading area for
trucks with facilities equipped to receive gas oil, fuel oil and biodiesel. YPF is required to supply natural gas to be used on-site,
and, in the event of a shortage, YPF is required to supply gas oil for up to 45 days per year. The location of the YPF-owned Luján
de Cuyo refinery makes the logistics process easier due to the proximity of the Luján de Cuyo refinery to the Luján de
Cuyo plant.
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Brigadier Lopez Plant
The Brigadier Lopez power plant is located in
the Sauce Viejo Industrial Plant, in the city of Sauce Viejo, Santa Fe. The Sauce Viejo industrial plant is located on the National Highway
N° 11, 20 km from Santa Fe City, capital district of the Province of Santa Fe. This location is highly convenient due to its accessibility
and logistic advantages.
Furthermore, the Brigadier Lopez power plant
is located on the banks of the Coronda River, one of the major branches of the Paraná River. Such access from the Coronda River
provides a source of water supply for the generation process and the steam turbine’s condenser. The facility has a water treatment
plant with production levels suitable to meet its requirements.
The plant originally had an installed capacity
of 281 MW and has been in operation since August 2012. In 2025, we concluded the closing of Brigadier Lopez’s combined cycle, increasing
the total installed capacity of the power plant to 421 MW.
Central Puerto
acquired the plant in June 2019, with the objective of installing a steam turbine, which had already been acquired, with an installed
capacity of up to 140 MW in a combined cycle configuration together with the existing gas turbine. Such project was effectively concluded
and operational in December 2025 and initiated commercial operations in January 2026 (See “Item 4. A History and development of
the Company—Purchase of the Brigadier Lopez Plant").
The Brigadier Lopez Power Plant has 421 MW of
total capacity, operating as a combined cycle unit. This generating unit is composed of a modern Siemens Gas Turbine (TG01) model SGT5-4000
F and an air-cooled Siemens power generator, model SG 1000A. The Gas Turbine can operate both on natural gas and gas oil (diesel oil).
In addition, the plant has a 140 MW Steam Turbine
model SST-900 RH Dual Casing and a Heat Recovery Steam Generator. Under a combined cycle configuration, the Brigadier Lopez plant currently
operates as a highly efficient combined cycle, increasing both its efficiency and total power capacity.
The electric power generated by the units installed
in the Brigadier Lopez power plant is delivered to the SADI, first through a high voltage power transformer, and then through the Brigadier
Lopez 132 kV power sub-station. While the transformer is property of Central Puerto, the sub-station is operated by EPE Santa Fe (holder
of the electric distribution and transmission concession in the Province of Santa Fe). The transformer changes the generator’s voltage
output to meet the required voltage of the electrical grid, and the sub-station serves as an interface between the Brigadier Lopez plant
and the overhead transmission lines connected to the SADI.
The plant operates most of the time using natural
gas. It is connected to the main gas pipeline through a 19-km dedicated pipeline that guarantees supply of natural gas. Alternatively,
the plant can also be operated using liquid fuels which must be transported by land, typically by truck. To accommodate the fuel supply
chain, the plant has an unloading area for trucks with facilities equipped to receive and deliver gas oil. Additionally, the plant has
a dock (which, as of the date of this annual report is not yet operational), for purposes of receiving liquid fuels transported by tanker
ships.
San Lorenzo
The San Lorenzo power plant is located near
San Lorenzo city in the Province of Santa Fe. In 2014, we acquired four heavy-duty, highly efficient gas turbines ((i) one General Electric
gas turbine with a capacity of 373 MW; (ii) two Siemens gas turbines, each with a capacity of 298 MW; and (iii) one Siemens gas turbine
with a capacity of 286 MW) and were awarded two co-generation projects at San Lorenzo (with an awarded electric capacity of 330 MW and
317 MW for the winter and summer, respectively) that started operations on August 15, 2021.
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The San Lorenzo power plant is a Siemens combined
cycle able to generate up to 391 MW, with a 291 MW Gas turbine and a 100 MW Steam turbine. By electric output regulation, the plant can
supply up to 370 tn/h of steam to our neighbor customer, T6 Industrial S.A. Gas turbine can operate on natural gas or gas oil.
The electric power generated by the units installed
in the San Lorenzo plant is delivered to the SADI through two connections. The steam turbine generator is connected by a 132 KV cable
with San Lorenzo Substation (EPESF facility) and the gas turbine generator is connected by a 500 KV line to TRANSENER facilities.
Maintenance
The plants have repair shops, warehouses and
facilities suitable for the operation and maintenance of the units. Maintenance of the plants is coordinated with CAMMESA to avoid shortage
in the power grid. Repair and maintenance procedures are key to the success of our business and are conducted according to unit type by
either our own staff or under long-term service agreements executed with leading global companies in the construction and maintenance
of thermal generation plants, such as (i) General Electric, which is in charge of the maintenance of the Puerto combined cycle plant and
part of the Luján de Cuyo-based units, and (ii) Siemens, which carries out the maintenance of the combined cycle of the Mendoza
site, the Brigadier Lopez thermoelectric plant and the Luján de Cuyo and San Lorenzo cogeneration units, and (iii) Mitsubishi,
which carries out the maintenance of the remaining combined cycle located in Central Costanera.
Under long-term service agreements, suppliers
provide materials, spare parts, labor and on-site engineering guidance in connection with scheduled maintenance activities, in accordance
with the applicable technical recommendations.
Our own staff oversees the maintenance of the
steam turbine generator sets. We maintain an inventory of the necessary spare parts on-site, which ensures the immediate availability
of parts when needed. This reduces the time it takes to replace the spare parts while ensuring a supply of spare parts that may no longer
be available in the market.
We carefully plan both in-house and outsourced
maintenance, with General Electric, Siemens, and Mitsubishi providing services under long-term agreements. Each provider utilizes its
own monitoring systems to anticipate potential failures. These arrangements allow us to minimize downtime and reduce government-imposed
outage rates, thereby maximizing unit efficiency.
Within the framework of the long-term maintenance
service agreements for our thermal generation plants, the above-mentioned suppliers provide materials, spare parts, labor and engineering
direction of scheduled maintenance in accordance with the corresponding technical recommendations.
We have entered into long term contracts with
Vestas Argentina S.A. for the operation and maintenance of the La Genoveva I wind farms until August 30, 2040, La Genoveva II until May
31, 2039, La Castellana II until May 31, 2039 and Manque and Los Olivos until May 31, 2039. We have also entered into long term contracts
with Nordex Energy Argentina S.A for the operation and maintenance of the Achiras wind farm until September 3, 2028 and La Castellana
until August 12, 2028. As for the Guañizuil II A solar farm we currently hold a long-term contract with Huawei International Corporation
until 2030.
We have long-term maintenance contracts with
the manufacturers of our combined cycle units and co-generation plants with the largest capacity, namely the Puerto combined cycle unit,
the Luján de Cuyo combined cycle unit at the Luján de Cuyo plant, the Brigadier Lopez gas turbine, the co-generation units
at the Luján de Cuyo plant, the San Lorenzo cogeneration plant, the Mitsubishi combined cycle in Central Costanera and our windfarms
and solar farms, under which the manufacturers provide maintenance using best practices recommended for such units. Our remaining units
receive maintenance through our highly trained and experienced personnel, who strictly follow the recommendations and best practices
established by the manufacturers of such units. We are also capable of generating power from several sources of fuel, including natural
gas, diesel oil and fuel oil. In addition, in recent years we have invested in adapting our facilities to be able to generate power from
biofuels, and we have developed business relationships over the years with strategic companies from the oil and gas and the biofuel sectors.
Our power generation units are also favorably positioned along the system’s power dispatch curve, also known as the WEM marginal
cost curve. This advantageous position is due to our technologically diverse power generation assets and high fuel consumption efficiency.
These factors ensure a robust energy dispatch to the system, even considering upcoming capacity additions that were awarded under auctions
seeking to increase thermal generation capacity and capacity from renewable energy sources.
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During 2025, we carried out scheduled and corrective
maintenance activities across our generation fleet to ensure safe, reliable and efficient operations. These activities included major
scheduled outages, equipment inspections, upgrades and corrective repairs on turbines, boilers, generators, transformers and auxiliary
systems. The most relevant maintenance activities performed during the year are summarized below by site:
Puerto Nuevo / Nuevo Puerto
Major scheduled maintenance was conducted on Unit
6 between April and June 2025.
Key activities included:
· Opening and inspection of high- and medium-pressure turbine stages;
· Removal of the generator rotor and stator rewedge;
· Evaluation of the unit control system for potential future hydraulic upgrades;
· Inspection and maintenance of motors, pumps, phase transformers and high-voltage equipment;
· Non-destructive testing (NDT) on critical boiler and rotating components;
· Boiler repairs including insulation reconstruction, valve repairs, duct repairs and chemical cleaning; and
· Replacement of steam air heaters, manufactured through reverse engineering.
These activities resulted in reduced fuel and
water consumption for the unit.
Between September
and October 2025, a major scheduled outage was carried out in Unit 7.
Main works included:
· Replacement and straightening of boiler tubes and restoration of insulation systems;
· Replacement of economizer header nipples;
· Generator commutator rectification;
· NDT inspections of critical components;
· Maintenance and adjustment of safety valves;
· Repairs to ash system expansion joints and process ducts;
· Electrical testing of generator and excitation transformer; and
· Replacement of the event recorder system.
Following these interventions, the unit recovered
approximately 12% of its original nominal capacity.
A short-scheduled
outage was conducted in September 2025 in Unit 9. This included:
· Insulation repairs and chimney reinforcement;
· Inspection of turbine axial bearing;
· Repairs to 4.16 kV switchgear room; and
· Maintenance of feedwater pump check valves.
In addition
to the above, other key maintenance activities were conducted during the year ended 2025, such as:
· Implementation of motion amplification diagnostics on cooling pumps to identify root causes of recurring failures;
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· Repair of the 18 MVA turbine-generator auxiliary transformer for Unit 6 following predictive maintenance diagnostics based on dissolved gas analysis;
· Repair of the transformer workshop overhead crane, enabling in-house transformer maintenance;
· Installation of load limiters on river water intake cranes;
· Replacement of the main natural gas valve at the Puerto Nuevo plant; and
· Installation of partial discharge monitoring systems on generators of Units 6 and 9.
In addition, engineering analysis identified
a steam migration issue affecting the axial bearing temperature of Unit 6 following the outage. Consequently, a design modification to
the high-pressure stage piping was implemented, eliminating the resulting power limitation.
Central Costanera
Maintenance activities at the Central
Costanera plant during 2025 included upgrades, scheduled maintenance and equipment rehabilitation across the combined-cycle and conventional
units. The key activities included:
· Upgrade a gas turbine;
· Improvements in demineralized water production capacity;
· Improvements in water intake systems and environmental mitigation;
· Reconditioning of chemical treatment systems; and
· Commissioning of water filter systems.
Mitsubishi
Combined Cycle Units
Maintenance activities on Units TG8, TG9 and
TV10 included:
· Reconditioning of heat recovery steam generators (HRSGs) and gas ducts;
· Replacement of structural elements and expansion joints;
· Inspection, repair and replacement of water-steam circuit valves;
· Anti-corrosion treatments on gas turbine and HRSG structures; and
· Generator auxiliary maintenance and cooling system repairs.
Balance
of Plant
Maintenance activities included:
· Electrical testing of medium- and low-voltage motors;
· Preventive maintenance on pumps, compressors and valves;
· Inspection and cleaning of condensers and cooling systems;
· Calibration of instrumentation under ISO 9001 standards; and
· Maintenance of fire protection systems and lubrication systems.
Mendoza
Maintenance activities at the Mendoza
plant combined-cycle complex focused on scheduled inspections and a major overhaul of the main gas turbine.
Combined
Cycle Siemens/Skoda (CC25)
During March 2025, a minor inspection was conducted
on Gas Turbine TG25, which included:
· Inspection of compressor and turbine borescope;
· Replacement of combustion chamber heat shield components; and
· Preventive and corrective maintenance on auxiliary systems.
Furthermore, in October 2025, a major inspection
with life extension was performed, including works on:
· A gas turbine rotor;
· Compressor and turbine blades and vanes;
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· A combustion chamber;
· Excitation, protection and vibration monitoring systems; and
· The combined cycle’s control system.
Maintenance was also performed on steam turbine
TV15, HRSG equipment and balance-of-plant systems.
Cogeneration
Units
TG26 experienced a stator winding damage. Such
stator is in the process of being replaced and the unit is expected to return to service during the second half of 2026.
TG27 underwent a scheduled Type-A inspection
(50,000 equivalent operating hours) including turbine, compressor and generator inspections.
Additional preventive and corrective maintenance
were conducted on other gas turbines, steam turbines and auxiliary systems across the site.
Piedra del Águila Hydroelectric Plant
During 2025, seasonal maintenance outages were
carried out on generating units in accordance with the annual maintenance program. The main activities included:
· Electrical testing of generator-transformer systems;
· Inspection and repairs of stator windings and collector bars;
· Replacement of generator heating resistors;
· Comprehensive transformer testing;
· Cleaning of generator cooling systems;
· Replacement of components in the excitation system;
· Inspection of hydraulic systems, guide vanes and control equipment; and
· Turbine runner repair and polishing.
All inspections and maintenance activities were
completed successfully.
Brigadier López Power Plant
During the year 2025, a major maintenance
program was performed at the plant, which included:
· Extended Hot Gas Path Inspection (eHGPI) of the gas turbine;
· Medium inspection of the gas turbine generator;
· Replacement of first-stage turbine blades;
· Replacement of compressor blades and combustion chamber components; and
· Upgrades to control systems and plant protection systems, and annual balance-of-plant activities.
During the year, the plant also supported the
commissioning and startup of the combined-cycle configuration, achieving first synchronization in December 2025.
San Lorenzo Cogeneration Plant (Terminal
6)
During 2025, maintenance activities were
conducted under the long-term service agreement (LTSA) with Siemens. In March 2025, a minor inspection was conducted on the gas and steam
turbine units, including:
· Combustion chamber ceramic replacement;
· Inspection and cleaning of compressor blades;
· Inspection of generators and HRSG;
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· Maintenance of circuit breakers and transformers; and
· Calibration of plant instrumentation.
In addition
to these, other maintenance activities included:
· Maintenance of auxiliary systems, pumps, motors, compressors, cooling systems and condensers;
· Preventive inspections of electrical protection systems;
· Repairs to river water intake pumps and plant process systems; and
· Maintenance of gas and water treatment systems.
Various improvement projects were also implemented,
including water system upgrades, plant infrastructure improvements and additional automation of control systems.
Fuel and Water Supply for Thermal Generation
Our conventional resource plants operate on three
different types of fuel: (i) natural gas in all units, (ii) fuel oil in the steam turbines exclusively and (iii) gas oil in the gas turbines
and combined cycle units. In addition, a mix of bio-diesel and gas oil may be used in certain percentages in our dual combined cycle units.
The table below shows the potential consumption
(calculated as the standard consumption declared by CAMMESA based on the unit manufacturer’s specifications, assuming the unit produces
energy throughout the entire day) of fossil fuel by the units in the conventional resource plants we owned as of December 31, 2025:
Plan Unit Natural gas (thousands m3) Gas oil (m3) Fuel oil (ton)
Puerto combined cycle CEPUCC11 332,628 26,754 —
Puerto combined cycle CEPUCC12 337,702 2,034 —
Nuevo Puerto NPUETV05 7,309 18,751 —
Nuevo Puerto NPUETV06 3,653 138,445 —
Puerto Nuevo PNUETV07 56,770 — 7,102
Puerto Nuevo PNUETV08 6,317 — —
Puerto Nuevo PNUETV09 178,020 — 18,034
Subtotal Puerto Complex
Central Costanera COSTTV01 18,959 — 3,808
Central Costanera COSTTV02 23,829 — 2,763
Central Costanera COSTTV03 33,252 — 3,190
Central Costanera COSTTV07 59,067 — 333
Central Costanera COSTCC08 352,012 1,370 —
Central Costanera COSTCC09 284,473 1,535 —
Central Costanera BSASCC01 102,256 — —
Subtotal Central Costanera Complex
Luján de Cuyo LDCUCC25 330,577 — —
Luján de Cuyo LDCUTV11 24,887 — —
Luján de Cuyo LDCUTV12 15,049 — —
Luján de Cuyo LDCUTG22 5,111 — —
Luján de Cuyo LDCUTG23 8,061 — —
Luján de Cuyo LDCUTG24 4,589 — —
Luján de Cuyo LDCUTG26 62,552 — —
Luján de Cuyo LDCUTG27 70,389 — —
Subtotal Luján de Cuyo plant
Brigadier Lopez BLOPTG01 18,804 2,952 —
Subtotal Brigadier Lopez plant
San Lorenzo TER6CC11 420,952 37,774 —
Subtotal San Lorenzo plant
Total Central Puerto 2,757,220 229,615 35,231
__________________
Source: CAMMESA.
Definitive Seasonal Programming
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Our exposure
to changes in fuel prices has increased since the issuance of Res. No. 21/2025 and Res. No. 400/2025. Prior to these resolutions,
the fuel necessary to produce our base energy was supplied by CAMMESA at no charge, and the price received by generators for such energy
was determined by the SE without reference to the cost of the fuel supplied. Under the framework introduced by Res. No. 21/2025 and 400/2025,
which established a progressive normalization of the WEM, generators are progressively transitioning toward a scheme in which fuel costs
are no longer fully absorbed by CAMMESA. As a result, we are increasingly exposed to fluctuations in the prices of natural gas, gas oil
and fuel oil used across our generating units. To the extent that we are unable to pass through or hedge such increased fuel costs, our
results of operations and financial condition could be materially and adversely affected.
The transition from
CAMMESA being the sole fuel supplier to a self-management model marks a structural shift in how we source fuel, thereby increasing our
direct market exposure to price volatility. CAMMESA retains a last-resort supplier role for liquid fuels under certain conditions, particularly
during the winter season.
During the first two months
of 2025, CAMMESA remained the sole supplier of liquid fuels to generators under the framework established by Res. No. 95/2013. Beginning
in March 2025, we initiated the self-management of liquid fuel procurement for electricity generation in accordance with Res. No. 21/2025.
With respect to natural
gas, pursuant to Res. No. 400/2025, generators are permitted to procure the natural gas required for electricity generation. However,
CAMMESA continues to hold natural gas supply contracts with oil and gas producers under Plan Gas IV, which are scheduled to expire on
December 31, 2028. Until such date, we have adhered to a natural gas pool managed by CAMMESA in order to comply with existing contractual
commitments. In addition to the volumes supplied by CAMMESA, we have the flexibility to procure incremental natural gas volumes in the
market during certain periods of the year.
Beginning in January 2029,
we expect to assume full responsibility for the procurement of natural gas required to operate our thermal generation facilities.
Natural Gas
Self-managed gas procurement
was already in place at the Luján de Cuyo (Mendoza) and San Lorenzo (Santa Fe) cogeneration plants under Res. No. 287/2017, covering
both steam and power generation.
Total natural gas purchased
in 2025 across all plants reached approximately 521 MMm³, broken down as follows:
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· Luján de Cuyo: 264.5 MMm³ (cogeneration steam + power, incl. self-managed under Res. No. 21/2025 and 400/2025)
· San Lorenzo: 128.1 MMm³ (cogeneration steam plus power, incl. Bolivian imported gas)
· Puerto complex: 9.8 MMm³ (self-managed for power generation under Res. No. 21/2025 and 400/2025, from March through May only)
Fuel
Oil (FO): Out of the total consumption of 28.8 thousand tons set forth above, a total of 18.9 thousand tons were purchased for
the Puerto Nuevo and Nuevo Puerto units under the self-managed fuel procurement scheme. The fuel oil purchases were sourced from Raizen
Argentina.
Gas Oil (GO): For the Nuevo
Puerto Combined Cycle, 19.9 Mm³ were self-procured from YPF, while the balance was supplied by CAMMESA in its capacity as last-resort
supplier. With respect to the San Lorenzo cogeneration plant, 11 Mm³ were self-procured from Trafigura Argentina.
With respect to water consumption, water costs
are incurred only in limited circumstances, as we generally produce the water required for our operations using our own facilities. In
connection with the supply of steam to YPF’s Luján de Cuyo plant in Mendoza, we incur water costs when consumption exceeds
the thresholds specified in our contract with YPF.
Electricity Generation from our Hydroelectric
Complex
Piedra del Águila
The Piedra del Águila hydroelectric complex
is the largest private sector hydroelectric generation complex in Argentina. It was completed in 1994 and is located approximately 1,200
kilometers to the southwest of Buenos Aires at the edge of Limay River and on the border of the provinces of Neuquén and Río
Negro. Piedra del Águila has an installed capacity of 1,440 MW from four 360 MW generating units. Although the initial concession
term expired on December 28, 2023, the Argentine Government granted Central Puerto an extension of two years while the privatization process
of the HPDA plant unfolded. Since January 9, 2026, a new 30-year concession for the Piedra del Águila hydroelectric plant become
effective, following a national and international public tender process conducted by the Argentine government. The facility has an installed
capacity of 1,440 MW and the economic offer for the concession was US$245 million. The new concession secures long-term operating rights
for one of the largest hydroelectric assets in Argentina.
Piedra del Águila has a gravity dam made
of concrete, with a maximum height of 170 meters from its foundation, a power plant with four generating turbines of 360 MW each, intake
and pipeline work, a spillway with an unloading capacity of 10,000 cubic meters per second, river diversion works, unloading equipment
with a capacity of 1,500 cubic meters per second, and construction facilities, including access roads, a bridge and electric power supply.
The dam is designed to be able to accommodate two additional turbines of 360 MW, although, as of the date of this annual report, we do
not plan to have them installed (they would provide the plant with increased power to supply demand peaks but would not change the electric
power generated per year since such generation depends on river water levels).
Water resources allow Piedra del Águila
to generate an average of 4,4 TWh per year (based on historical operations between 1994 and 2025, exclusive of electric power generated
for internal use). During this period, the maximum generation in a single year was 7,3 TWh in 2006 and the lowest was 4 TWh in 2016.
The following table shows the electric power
generated (in TWh/year) by Piedra del Águila during the period generation volumes 1994-2025:
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__________________
Source: CAMMESA.
The Dam. The Piedra del Águila
dam is composed of approximately 2.8 million cubic meters of waterproof concrete. It is 860 meters long and approximately 170 meters high
(from its foundation). The storage capacity of the dam totals 12 billion cubic meters, out of which 6 billion cubic meters are usable,
which would allow for 45 days’ generation at a capacity of 1,440 MW on a 24-hour basis.
Safety of the Paleochannel. There is a
fluvial valley filled with basalt on the left bank of the dam, which we refer to as the “paleochannel”. This natural structure
consists of the second part of the river closing, which was made waterproof to ensure stability. The paleochannel contained a potential
leakage zone on the left bank. To mitigate risks associated with this potential leakage zone, a number of works were performed to reduce
drainage gradients and ensure stability prior to the initial filling of the dam:
· Cutoff Curtain: To make the alluvial fill between the bedrock and the basalt contact area watertight, a cutoff curtain was created through grouting and chemical injections from horizontal tunnels of about 1,200 meters in length that were dug into the massif.
· Diaphragm Wall: This is a transition concrete structure of about 150 meters in length that connects the cutoff curtain to the dam.
· Drainage Curtain: This is a horizontal tunnel of over 400 meters in length dug in the rock massif that covers the entire transversal section of the paleochannel, from which drillings were performed to capture the leakage water that passes the cutoff curtain.
· Drainage Wells: These consist of five vertical wells of about 40 meters in depth and five meters in diameter located in a downstream area of the drainage curtain, from which sub-horizontal holes were drilled directed towards the basalt-alluvium contact to capture the water draining through such highly permeable zone.
· Pumping System: This consists of ten electric pumps installed in a gallery located in the amphitheater (the area at the bottom of the paleochannel massif) intended to maintain piezometric levels of one of the existing aquifers in the alluvium at predetermined levels to ensure the zone stability.
The Power plant. The hydroelectric generation
plant is located at the foot of the dam and has four Francis-type turbines with corresponding generators, transformers for each generator
and operating, control and auxiliary equipment. The turbines are hydraulic turbines composed of vertical axes with a spiral steel casing.
Each turbine has a rated capacity of 360 MW and a rated hydraulic load of 350 cubic meters per second and is designed to rotate at 125
rpm.
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Each generator has a corresponding set-up transformer
of 500 kV, which consists of a dual guide rod system, with a single SF-6 iron-isolated switch, to which all generating units are connected.
The switch is connected to the SADI’s transformer substation through two transmission lines. Energy is delivered at Piedra del Águila’s
500 KV plant, which is operated by Compañía de Transporte de Energía Eléctrica en Alta Tensión S.A.
(“Transener”), which owns, operates and maintains the largest high voltage electric power transmission system in Argentina.
During the shutdowns and start-ups of the power
plant, there are two 13.2 kV lines in place that serve as auxiliary service related to the local distribution network operated by Neuquén’s
energy regulatory authorities, two back-up generators, and two 110V stationary batteries, each of which is capable of supplying electric
power.
The operation and maintenance of a hydroelectric
plant are relatively simple compared to the labor-intensive requirements of thermal plants. To operate the plant, we mainly monitor the
water flow, the electric power generation and the related equipment. The plant’s operations staff is organized into several departments:
(i) civil engineering (in charge of monitoring the equipment and the dam structure); (ii) operations (in charge of monitoring the delivery
of the electric power); (iii) special services and technical support; and (iv) administration. Our employees are in charge of plant maintenance.
Operation and maintenance of the hydroelectric
plant are managed in accordance with manufacturers’ recommendations and industry standards. To monitor management of the plant,
we use performance metrics specified in Standard 762 of the Institute of Electrical and Electronics Engineers (IEEE).
All ordinary operation and maintenance tasks
are performed by company personnel. Electromechanical maintenance of generators and auxiliary equipment focuses on fault prediction and
prevention and is intended to minimize corrective maintenance and maximize availability of the generators.
Generators are operated in accordance with the
requirements of the Organismo Encargado del Despacho (OED) (the “Dispatching Agency”) and in compliance with the Normas
de Manejo de Aguas (NMA) (Water Management Standards). Water management and dam operation are overseen by the Autoridad
Interjurisdiccional de Cuencas (Intergovernmental Basin Authority).
The status of the dam and paleochannel is audited
every five years by an independent expert panel under the supervision of the Organismo Regulador de Seguridad de Presas (ORSEP)
(Dam Safety Regulator). Fish and water quality are also monitored in the dam and tributaries at least four times per year.
Substantially all of the electric power produced
by Piedra del Águila and other generators in the Comahue area is transported to locations where demand is higher. Demand is highest
primarily in the Buenos Aires metropolitan area, which is located some 1,200 kilometers away from the plant. The distribution system from
the Comahue region comprises two corridors with a total of four 500 kV transmission lines (the last of them started to operate in December
1999), in addition to a fifth line that connects Comahue to the Cuyo region, which started to operate in September 2011. Since the end
of the construction of these last two lines, the plants in the Comahue region have been able to use the entire generation capacity.
Electricity Generation from our Wind and Solar
Generation Plants
As of December 31,
2025, Central Puerto accounted for 8.4% of Argentina’s total wind energy generation and 7.0% of its total solar energy generation.
As of the same date, Central Puerto had an installed wind capacity of 374 MW and solar capacity of 200 MW. Wind and solar generation assets
together represented 8.3% of Central Puerto’s total installed power generation capacity.
As of the date of this annual report we operate
seven wind farms (La Castellana I, La Castellana II, Achiras, Manque, Los Olivos, La Genoveva I and La Genoveva II) and three solar farms
(Guañizuil IIA, Cafayate and San Carlos). All our renewable energy plants are operated by CP La Castellana S.A.U., a wholly-owned
subsidiary of Central Puerto S.A.
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La Castellana I is owned by CP La Castellana
S.A.U., while La Castellana II, Manque, Los Olivos, La Genoveva II and the San Carlos solar farm are owned by Puerto Energías Renovables
S.A.U and La Genoveva I is owned by Vientos La Genoveva S.A.U. The Achiras wind farm is owned by CP Achiras S.A.U. As of December 31,
2025, CP La Castellana S.A.U., Puerto Energías Renovables S.A.U, Vientos La Genoveva S.A.U. and CP Achiras S.A.U. were all wholly-owned
subsidiaries of Central Puerto S.A. The PS Guañizuil II A solar farm is owned by CP Cordillera Solar S.A.U. which is a fully owned
subsidiary of Central Puerto S.A. The Cafayate solar farm is 99.99% owned by Central Puerto S.A. and 0.01% by Proener S.A.U. as of December
31, 2025.
La Castellana I Wind Farm
La Castellana I is a wind farm located in the
south of the Province of Buenos Aires, near the cities of Villarino and Bahía Blanca, and started its operations in August 2018.
La Castellana I has a total installed capacity
of 100.8 MW, from 32 wind turbines, supplied from Nordex-Acciona, of 3.15 MW each.
Achiras Wind Farm
Achiras is a wind farm located in the east of
the Province of Córdoba, near the city of Achiras, and started its operations in September 2018.
Achiras has a total installed capacity of 48
MW, from 15 wind turbines, supplied from Nordex-Acciona, of 3.2 MW each.
La Castellana II Wind Farm
La Castellana II is a wind farm located in the
south of the Province of Buenos Aires, near the cities of Villarino and Bahía Blanca, and started its operations in July 2019.
It has a total installed capacity of 15.2 MW, from 4 wind turbines, supplied by Vestas, of 3.6 MW each.
Manque Wind Farm
Manque is a wind farm located in the east of
the Province of Córdoba, near the city of Achiras, and partially started its operations in December 2019 (38 MW), in January 2020
(15.2 MW), and fully in March 2020 (3.8 MW). It has a total installed capacity of 57 MW, from 15 wind turbines supplied by Vestas, of
3.8 MW each.
Los Olivos Wind Farm
Los Olivos is a wind farm located in the east
of the Province of Córdoba, near the city of Achiras, and started its operations in February 2020. It has a total installed capacity
of 22.8 MW, from 6 wind turbines supplied by Vestas, of 3.8 MW each.
La Genoveva I Wind Farm
La Genoveva I is a wind farm located in the south
of the Province of Buenos Aires, near the town of Cabildo and 30 km to the northwest of the city of Bahía Blanca and started its
operations in November 2020.
It has a total installed capacity of 88.2 MW,
from 21 wind turbines, supplied from Vestas, of 4.2 MW each.
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La Genoveva II Wind Farm
La Genoveva II is a wind farm located in the
south of the Province of Buenos Aires, near the town of Cabildo and 30 km to the northwest of the city of Bahía Blanca and started
its operations in September 2019.
It has a total installed capacity of 41.8 MW,
from 11 wind turbines, supplied by Vestas, of 3.8 MW each.
Guañizuil IIA Solar Farm
On October 18, 2023, our subsidiary Proener acquired
100% of the capital stock of Cordillera Solar and Scatec Equinor Solutions S.A., who owned the solar power plant Guañizuil II A.
Guañizuil IIA is a photovoltaic plant located in the Province of San Juan. The photovoltaic plant has an installed capacity of
117 MW dc /105 MW ac. The plant has a nominal rated power capacity of 100 MW, generating approximately 300 GWh/year. The plant counts
with 358,560 solar panels and covers a total area of 270 hectares, being the third largest solar farm in Argentina. In addition, the Guañizuil
II A solar power plant has a capacity factor of 33%, exceeding the average for the region and positioning it as one of the farms with
the best capacity factor in the world. The remuneration scheme of the power plant is a PPA with CAMMESA under the Program Renov.ar 2.5
for 20 years.
Cafayate Solar Farm
On August 20, 2025, Central
Puerto acquired from Canadian Solar Energy Group B.V. and Canadian Solar UY Holding Latam S.A. the 100% of the shares and votes of Fieldfare
Argentina S.R.L. which owned and operated the Cafayate Solar Project, located in the Province of Salta, with a nominal power of approximately
80 MW and an annual generation of approximately 220 GWh. Our subsidiary PS Cafayate S.R.L. is the sole owner of this asset.
San Carlos Solar Farm
We successfully participated in CAMMESA’s
auction under the MATER framework and were awarded 10 MW of dispatch priority for our Parque Solar San Carlos project, located in San
Carlos, Province of Salta. Commercial operations of the project commenced in November 2025, with 10 MW of dispatch priority under the
MATER framework. See “Item 4. A History and development of the Company—Renewable energy projects”.
FONINVEMEM and Similar Programs
Following Argentina’s economic crisis in
2001 and 2002 and the subsequent devaluation of the peso, there were significant imbalances between the electric power prices generators
received and their operating costs. As resources in the country’s Stabilization Fund, a fund administered by CAMMESA intended to
make up for fluctuations between the seasonal price paid by distributors and the spot price in the WEM, became scarce due to the Argentine
Government’s decision to maintain seasonal prices (the energy prices paid by distributors) below the spot price paid to generators,
the Argentine Government, through a series of resolutions, fixed a set of priorities with respect to payments made from this fund. This
resulted in a system under which generators collected payment for only variable generation costs and power capacity, while the resulting
monthly obligations to generators for the unpaid balance were to be considered LVFVD.
In December 2004, we agreed to participate in
the creation of the FONINVEMEM. We entered into an agreement on October 17, 2005, which stated that generators would receive (i) their
receivables relating to sales of electric power from January 2004 through December 2006, amounting to US$157 million in our case, plus
an interest rate of 360-day LIBOR plus 1.00% in 120 equal, consecutive monthly installments and (ii) their proportional equity
interest in the generating companies formed for such projects, TJSM and TMB, which are in charge of managing the purchase of equipment,
and of building, operating and maintaining each of the new power plants, and after ten years of operation would receive the property of
these plants. The generation plants are not owned by TJSM and TMB but rather owned by two trusts, created by the Argentine Government,
that receive revenue from the sale of electric power generated by the plants, among others, to repay the LVFVD receivables.
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After the commercial authorization was granted
to the Manuel Belgrano power plant on January 7, 2010, and the San Martín power plant on February 2, 2010, we started to collect
monthly payments of the receivables. As of December 31, 2025, we owned 11.31% of TJSM and 12.72% of TMB. The operating companies have
a variable revenue (US$1.00 per MW generated) and a fixed revenue to compensate for their operating costs. In 2025, we received no dividends
from our equity interests. See “Item 3D. Risk Factors—Risks Relating to our Business—Our interests in TJSM, TMB were
diluted and CVOSA will be significantly diluted” and “Item 4.B. Business Overview—Our Affiliates—Termoeléctrica
José de San Martín S.A. (TJSM) and Termoeléctrica Manuel Belgrano S.A. (TMB)”.
Additionally, on March 20, 2018, CAMMESA granted
CVO commercial approval in the WEM as a combined cycle. A PPA between the CVO Trust and CAMMESA, through which the CVO Trust makes energy
sales and, consequently, receives the cash flow to pay the trade receivables, had to be entered into in order to start the collections.
The PPA agreement was entered into on February 7, 2019, with retroactive effect to March 20, 2018. As a result, the original amortization
schedule from the CVO Agreement is in full force and effect.
During 2025 and 2024, we collected Ps.97.85 billion
and Ps.110.06 billion from CVO receivables, respectively, in each case measured in Pesos as of December 31, 2025.
In accordance with the CVO agreements, after
the first ten years of operation, ownership of the combined cycle plants was transferred from the trust to the operating companies, and
the operating companies began to receive revenues from the sale of electric power generated by the plants. At that time, because the Argentine
Government financed part of the construction of the plants, it became a shareholder of CVOSA, and our interests in CVOSA were significantly
diluted. Although the precise extent of this potential dilution has not yet been defined, the Argentine Government’s ownership interest
in CVOSA will be at least of 70%. The dilution of our interest in CVOSA will reduce our income from CVOSA and could adversely affect our
results of operations.
Forestry assets
On December 27, 2022, our subsidiary Proener
acquired 100.00% of the capital stock and votes of Forestal Argentina S.A. and Masisa Forestal S.A. (currently, Loma Alta Forestal S.A.)
which own forestry assets in the provinces of Entre Ríos and Corrientes.
On May 3, 2023, we further expanded our forestry
business, as our subsidiary Proener acquired 100% of the capital stock and votes of Empresas Verdes Argentina S.A., Las Misiones S.A.
and Estancia Celina S.A. These companies own forestry assets in the province of Corrientes.
Following the merger of the above-mentioned forestry
companies (see “Item 4—Information of the Company— Recent Developments—Simplification of Corporate Structure at
Central Puerto S.A.”), we currently hold our forestry interests through two subsidiaries: (a) Forestal Argentina S.A., which owns
approximately 141,000 hectares of land in the provinces of Entre Ríos and Corrientes, with a plantable area of approximately 77,500
hectares, of which approximately 67,000 hectares are planted with eucalyptus and pine; and (b) Loma Alta Forestal S.A., which owns approximately
19,400 hectares of land in the province of Corrientes, of which approximately 10,400 hectares are planted with pine.
Argentina has one of the highest forestry growth
rates globally, with trees growing approximately ten times faster than in the Northern Hemisphere. These acquisitions have diversified
our asset portfolio and operations and strengthened our position in the energy sector, as these assets are a potential source of future
business opportunities related to carbon credits and biomass-based energy generation. Following these acquisitions, our property, plant
and equipment include more than 160,000 hectares.
Market Area and Distribution Network
Market Area
Our power generation plants are located at different
locations in Argentina. All of them are connected to the SADI, enabling coverage for residential and industrial users nationwide.
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Puerto plants: The Puerto Nuevo, Nuevo
Puerto and Puerto combined cycle plants are situated in a unique location within the port of the City of Buenos Aires, one of the most
populated metropolitan areas in the world, which reduces costs arising from lost power during transmission. In addition, the plants have
three docks for unloading liquid fuels from large vessels, thus facilitating the supply of fuel.
Central Costanera plant: The Central Costanera
plant sits strategically in the southern area of the port of the City of Buenos Aires adjacent to the Río de la Plata. This positioning
allows a significant flexibility in fuel supply, and also a key proximity to the country’s major electricity consumption center,
the Greater Buenos Aires area. This city, together with Greater Buenos Aires, requires about 40% of the total electricity produced in
the country.
Piedra del Águila Hydroelectric Complex:
the Piedra del Águila hydroelectric complex is located on the Limay river, which serves as the border between the provinces of
Río Negro and Neuquén. The dam is close to the city of Neuquén and is able to supply energy to cities far from the
complex through existing transmission lines.
Brigadier Lopez plant: The Brigadier Lopez
Plant is located in the Province of Santa Fe, near the City of Sauce Viejo.
San Lorenzo plant: The San Lorenzo Plant
is located in the Province of Santa Fe, near the City of San Lorenzo.
Luján de Cuyo plant: The Luján
de Cuyo plant is located within YPF’s Luján de Cuyo refinery and supplies steam to such refinery. This location enables it
to obtain gas oil supplies from the refinery itself in case of natural gas shortages.
La Castellana I and II Wind Farms: La
Castellana I and II wind farms are located in the Province of Buenos Aires, near the cities of Villarino and Bahía Blanca.
La Genoveva I and II Wind Farms: La Genoveva
I and II wind farms are located in the Province of Buenos Aires, near the town of Cabildo and the city of Bahía Blanca.
Achiras Wind Farm: Achiras wind farm is
located in the Province of Córdoba, near the City of Achiras.
Manque Wind Farm: Manque wind farm is
located in the Province of Córdoba, near the City of Achiras.
Los Olivos Wind Farm: Los Olivos wind
farm is located in the Province of Córdoba, near the City of Achiras.
Guañizuil II A Solar Farm: Guañizuil
II A Solar Farm is located in the Province of San Juan, located near National Route 150.
Manuel Belgrano plant: The Manuel Belgrano
plant is located in the Province of Buenos Aires, near the City of Campana.
Cafayate Solar Farm: A Solar Farm located
in the Province of Salta, near de City of Cafayate.
San Carlos Solar Farm: A Solar Farm located
in the Province of Salta, near the City of San Carlos.
Distribution Network
All of our plants are connected to the SADI,
which allows us to reach almost all electricity users in the country. The SADI permits interaction among all agents in the Argentine
WEM and allows generating companies to dispatch power to Large Users and distributors through the transmission companies. The system
is regulated and allows participation of all WEM agents, such as generators, transmission companies, distributors, Large Users and the
Argentine Government through CAMMESA.
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The prices for power transmission are regulated
and based on the distance from the generating company to the user, among other factors. In this regard, our thermal power plants are strategically
located in important city centers or near some of the system’s largest customers (e.g., YPF’s refineries), which constitutes
a significant competitive advantage.
Our Customers
For the year ended December 31,
Modality continuing operations Main clients 2025
(in thousands of Ps.) (percentage of revenues)
Spot Sales CAMMESA 548,762,404 50.0 %
Term market Sales Under Contract CAMMESA 281,004,785 25.6 %
RenovAr Program CAMMESA 67,621,049 6.2 %
MATER sales under contracts Cervecería y Maltería Quilmes S.A.I.C.A. y G. (subsidiary of AB Inbev); PBB Polisur S.A. (subsidiary of Dow Quemicals); Aguas y Saneamientos Argentinos S.A., among others. 101,703,205 9.3 %
Steam sales YPF / T6 Industrial S.A. 51,757,640 4.7 %
Forestry Enrique Zeni & Cia Saciafei Gran Mandisovi S.A. A.C.B. Alimentos Coronel Baigorria Urcel Argentina S.A. Borgo Horacio Rene 19,080,032 1.7 %
Revenues from CVO thermal plant management CVO Trust 18,616,093 1.7 %
Other YPF 8,876,982 0.8 %
__________________
Notes:-
(1) See “Item 4.B. Business Overview—The Argentine Electric Power Sector—Remuneration Scheme—The Current Remuneration Scheme”.
For a discussion of the different regulatory
regimes under which we sell our electric power, see “Operating and Financial Review and Prospects—Factors Affecting our Results
of Operation—Our Revenues” and “Item 4.B. Business Overview—The Argentine Electric Power Sector—Structure
of the Industry”.
Seasonality
Seasonality of Electricity Generation by
Thermal Facilities
The following graph breaks down our average thermal
energy production on a month-by-month basis since 2018:
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__________________
Source: CAMMESA.
Seasonality of Water Resources and Electricity
Generation of Piedra del Águila
The availability of water is the key factor for
determining Piedra del Águila’s electric power generation capacity and is tied to annual and seasonal changes in rains in
the upstream mountain area of Piedra del Águila. Water levels generally increase between May and December due to the winter rains
and the spring thaw, and we are able to produce more energy over such periods. The following graph breaks down our average hydroelectric
energy production since 2020 on a month-by-month basis:
__________________
Source: CAMMESA.
Seasonality of Wind and Solar Resources
and Electricity Generation of Achiras, La Castellana I, La Castellana II, La Genoveva I, La Genoveva II, Manque and Los Olivos wind farms
and Guañizuil II, Cafayate and San Carlos solar farms
The availability of wind resources is the key
factor for determining the wind farms electric power generation capacity and is tied to annual and seasonal changes in wind speed in
the areas where each farm is located. Wind speed is generally higher between May and September, and we are able to produce more energy
over such periods. For additional information on environmental issues that may affect our operations, see “Item 3.D.—Risk
Factors—Risks relating to Our Business—Our ability to operate wind and solar farms profitably is highly dependent on suitable
wind or sun and associated weather conditions, climate change and energy transition could affect our business”.
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The following graphic shows our renewable energy
production from our wind and solar farms on a month-by-month basis since its inception and until December 2025:
__________________
Source: CAMMESA
Competition
The demand for electric power in Argentina is
served by a variety of generation companies, both state-owned and private-owned. These companies pursue the right to supply generation
capacity and electric power and to develop projects to serve the demand for electric power in Argentina. Some of our foreign competitors
are substantially larger and have substantially greater resources than our company. Because of the significant gap between the demand
and supply of electric power in Argentina, voluntary and forced blackouts at times of seasonal peak consumption have occurred. On February
10, 2025, SADI recorded an all-time peak power demand of 30,257 MW, surpassing the previous record of 29,653 MW set on February 1, 2024.
In 2025, 4,304 GWh were imported, representing a 7.52% decrease in energy imports as compared to 2024.
Our primary competitors in the electric power
generation market are Pampa Energía S.A., The AES Corporation, YPF EE, MSU Energy, Albanesi, and GENNEIA.
Below we detail the installed capacity of the
main private sector generators in Argentina, as of December 31, 2025:
Power (MW) %
Central Puerto 6,837 15.5 %
Pampa Energía S.A. 4,991 11.3 %
YPF EE 3,679 8.3 %
The AES Corporation 3,620 8.2 %
MSU Energy 1,742 3.9 %
Albanesi 1,706 3.9 %
GENNEIA 1,592 3.6 %
__________________
Notes:-
Based on company’s
financial statements as of and for the year ended December 31, 2025. Data from CAMMESA. Does not include Foninvemem asset (3,167 MW).
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For more information about our market share please
See “Item 4. Business Overview—Our Competitive Strengths”:
Our efficiency levels compare favorably to those
of our competitors due to our efficient technologies. The following chart shows the efficiency level of our most important generating
units compared to the units of the rest of the market based on heat rate, which is the amount of energy used by an electrical generator
or power plant to generate one kWh of electric power:
__________________
Source: CAMMESA’s
seasonal programing.
We have developed business relationships over
the years with strategic companies from the oil and gas and the biofuel sectors, and in the past have participated in certain joint ventures
with some of them. We are one of the largest consumers of natural gas in Argentina’s electric power sector, as well as the one of
the largest consumers of fuel oil and gas oil.
Our exposure
to changes in fuel prices has increased since the issuance of Res. No. 21/2025 and Res. No. 400/2025. Prior to these resolutions,
the fuel necessary to produce our base energy was supplied by CAMMESA at no charge, and the price received by generators for such energy
was determined by the SE without reference to the cost of the fuel supplied. Under the framework introduced by Res. No. 21/2025 and 400/2025,
which established a progressive normalization of the WEM, generators are progressively transitioning toward a scheme in which fuel costs
are no longer fully absorbed by CAMMESA. As a result, we are increasingly exposed to fluctuations in the prices of natural gas, gas oil
and fuel oil used across our generating units. To the extent that we are unable to pass through or hedge such increased fuel costs, our
results of operations and financial condition could be materially and adversely affected.
The transition from
CAMMESA being the sole fuel supplier to a self-management model marks a structural shift in how we source fuel, thereby increasing our
direct market exposure to price volatility. CAMMESA retains a last-resort supplier role for liquid fuels under certain conditions, particularly
during the winter season.
During the first two months
of 2025, CAMMESA remained the sole supplier of liquid fuels to generators under the framework established by Res. No. 95/2013. Beginning
in March 2025, we initiated the self-management of liquid fuel procurement for electricity generation in accordance with Res. No. 21/2025.
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With respect to natural
gas, pursuant to Res. No. 400/2025, generators are permitted to procure the natural gas required for electricity generation. However,
CAMMESA continues to hold natural gas supply contracts with oil and gas producers under Plan Gas IV, which are scheduled to expire on
December 31, 2028. Until such date, we have adhered to a natural gas pool managed by CAMMESA in order to comply with existing contractual
commitments. In addition to the volumes supplied by CAMMESA, we have the flexibility to procure incremental natural gas volumes in the
market during certain periods of the year.
Beginning in January 2029,
we expect to assume full responsibility for the procurement of natural gas required to operate our thermal generation facilities.
Insurance
We carry commercial and personal insurance coverage
for certain of our power generation plants, located at different geographical locations within Argentina. The following list includes
all the insurance risk covered:
1. Operational All Risks–- Including Material Damage & Machinery Breakdown and Business Interruption (Loss of Profits)
This coverage protects against unexpected events due to a sudden or accidental cause, including weather, fire and natural disasters, that may damage property or fixed assets (Material Damage); and Mechanical and Electrical breakdown events that may cause sudden and unforeseen physical loss or damage to machinery (Machinery Breakdown) that is operational; any of which may damage our ability to generate power, including coverage for consequential Loss of Profits (Business Interruption) for a maximum period of 12 months.
2. Commercial General Liability
This coverage protects against the claims from third parties arising out of bodily injury or death and property damage resulting from the insured activities including premises, operations, products and/or completed operations. The coverage limit is up to US$10,000,000 per occurrence.
3. C Commercial Excess Liability (CEPU only)
This coverage protects against the same risks described under Commercial General Liability, but provides coverage in excess of the underlying primary insurance limits, up to a combined limit of US$50,000,000 (concurrent across all locations).
4. Port Operators Liability (CEPU only)
Covers CEPU’s liability to third parties for personal injury or property damage arising from occurrences or events in connection with day-to-day port operator activities.
5. Directors and Officers Liability
This policy covers claims made against individuals while serving as directors or officers. Coverage is payable to such directors and officers, or to the organization itself, as indemnification or reimbursement for losses, or as advancement of defense costs, in the event an insured party suffers a loss arising from a legal action alleging wrongful acts in their capacity as directors or officers.
6. Motor Vehicle + Mobile Equipment
CEPU and its subsidiaries maintain coverage for fleet vehicles, trucks, and mobile equipment used in daily operations. Coverage ranges from basic third-party liability for mobile equipment to comprehensive coverage for certain vehicles, including protection against theft, fire, hail, vandalism, and property damage.
7. Worker’s Compensation
This insurance covers wages and medical benefits to employees injured in the course of employment and/or while commuting to and from work.
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8. Compulsory Life Insurance
This coverage is provided by the employer and guarantees the payment of a death benefit to designated beneficiaries upon the death of the insured employee.
9. Optional Term Life Insurance
This is an optional and additional coverage the employer pays over the basic compulsory life insurance in order to guarantee its employees the payment of 24 additional wages in case of death. This is part of an employee benefits plan.
10. Ocean & Inland Transit Risks
Provides annual transit coverage for all stages of transit and delivery, including marine, dock, air, and inland transportation, for shipments to and from locations worldwide and within Argentine territory. Premiums are paid monthly on an ex-post basis.
11. Commercial Business Combined
This policy is a tailored commercial insurance program designed to provide coverage specifically for the offices and warehouses owned by CEPU located in the city of Neuquén, the town of Piedra del Águila, and the Piedra del Águila Hydroelectric Dam facility. The policy is structured as a comprehensive business coverage program consolidated under a single policy, encompassing a broad range of coverages, including, without limitation: employers' liability, public liability, product liability, legal expenses, material damage and theft, and goods in transit. Additional coverages may be included as set forth in the applicable policy schedules and endorsements.
12. Construction All Risks / Erection All Risks (CAR/EAR)
This is a non-standard insurance policy that provides coverage for both property damage and third-party claims arising from bodily injury or property damage in connection with construction projects. We maintain this insurance for each construction project we undertake, and we obtain such coverage on a project-by-project basis as new construction activities commence.
13. Environmental Surety Bond
A mandatory financial guarantee under Law No. 25,675, required for activities with environmental risk. The insurance covers ecological damage and costs incurred in the provision of emergency services and environmental clean-up.
We believe that the level of insurance and reinsurance
coverage we maintain is reasonably adequate in light of the risks we are exposed to and is comparable to the level of insurance and reinsurance
coverage maintained by other similar companies doing business in the same industry.
Environment
As of the date of this annual report, we are
not involved in pending or threatened judicial proceedings in connection with environmental issues.
As of the date of this annual report, we have
obtained or have applied for the environmental permits required by the applicable environmental regulations and our environmental management
plans have been approved by the applicable regulatory authorities. To maintain high environmental standards, we carry out periodic controls
in accordance with applicable legislation.
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Our activities are subject to certain environmental
regulations. Our management considers that our operations comply in all relevant respects with applicable laws and regulations related
to environmental protection. On the other hand, we record provisions for decommissioning for renewable wind and solar assets based on
the commitments assumed with the owners of the properties where they are located. We also monitor potential changes relevant to environmental
legislation related to our activity and we have not identified significant changes in the foreseeable future.
We have developed a broad environmental compliance
and management program, which is subject to periodic internal and external audits by TÜV Rheinland.
In May 2025, TÜV Rheinland completed a series
of ISO recertification audits. The details of the certificates are as follows:
Standard: ISO 14001/2015
Certificate Register. No.: 01 10406 1629668
Certificate Holder: Central Puerto S.A. Av. Tomas
Edison 2701 Ciudad Autónoma de Buenos Aires Argentina.
Scope: Generation of electric energy from hydraulic
energy, thermal energy (gaseous and liquid fuel), wind energy, photovoltaic energy. Steam production. Operation and maintenance of extra
high voltage line.
Validity: The certificate is valid from 2022-08-18
until 2028-07-12.
Including the locations:
No: Name/Location Scope
1 Central Planta Buenos Aires Av. Thomas Edison 2701 Ciudad Autónoma de Buenos Aires Generation of electric energy from: thermal energy (gaseous and liquid fuels).
2 Central Mendoza Parque Industrial Provincial, Ruta 84 s/n, Lujan de Cuyo, Provincia de Mendoza Generation of electric energy from: thermal energy (gaseous and liquid fuels). Steam production.
3 Central Hidroeléctrica Piedra del Águila Ruta Nacional 237, Km 1450.5 8315 Piedra del Águila Provincia de Neuquén Generation of electric energy from: hydraulic energy
4 c/o Central Puerto S.A. – for its subsidiary Parque Eólico Achiras, Lote 325, Parcela 1274 (Latitude 33° 12’ 44,23’’S, Longitude 65° 5’ 16,52’’O), Achiras, Córdoba – Argentina Generation of electric energy from: wind energy.
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5 c/o Central Puerto S.A. – for its subsidiary Parque Eólico La Castellana, Camino rural a la altura de la RN 3, Km 712,5 (Latitud 38° 38’22,40’’ S, Longitud 62° 43’1,04’’ O), Villarino, Buenos Aires–- Argentina Generation of electric energy from: wind energy.
6 Planta Brigadier Lopez Ruta 11 Km 455 3017 Parque Industrial Sauce Viejo, Calle 8, Colectora Norte Santa Fe–- Argentina Generation of electric energy from: thermal energy (gaseous and liquid fuels).
7 c/o Central Puerto S.A. – for its subsidiary Parque Eólico La Castellana II Ruta 3 km 712,5 sobre camino vecinal, Villarino, Buenos Aires–- Argentina. Generation of electric energy from: wind energy.
8 c/o Central Puerto S.A. – for its subsidiary Parque Eólico La Genoveva II Ruta 51 Km 705, Cabildo, Buenos Aires–- Argentina Generation of electric energy from: wind energy.
9 c/o Central Puerto S.A. – for its subsidiary Parque Eólico Manque (Latitude 33°13’35.26”S; Longitude 65° 4’38.69”O), Achiras. Córdoba – Argentina Generation of electric energy from: wind energy.
10 c/o Central Puerto S.A. – for its subsidiary Parque Eólico Los Olivos (Latitude 33°13’50.34”S; Longitude 65° 2’59.94”O) Achiras. Córdoba – Argentina Generation of electric energy from: wind energy.
11 c/o Central Puerto S.A. – for its subsidiary Parque Eólico La Genoveva I Ruta 51 Km 705, Cabildo, Buenos Aires, Argentina Generation of electric energy from: wind energy.
12 Planta Cogeneración San Lorenzo Combate Punta Quebracho s/n (esquina Vucetich), zona rural Puerto Gral. San Martín, Santa Fe, Argentina Generation of electric energy from: thermal energy (gaseous and liquid fuels). Operation and maintenance of extra high voltage line (EVL)
13 Central Puerto S.A. – Guañizuil II A. Ruta Nacional 150 Km 304, Las Flores, San Juan, Argentina Generation of electric energy from: photovoltaic energy
Certificate Register. No.: 01 10406 2329630
Certificate Holder: Central Costanera
S.A. Av. España 3301.Ciudad Autónoma de Buenos Aires
Scope: Generation of electric energy
from: thermal energy (gaseous and liquid fuel).
Validity: The certificate is valid until
2028-07-27
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Including the locations:
No: Name/Location Scope
1 Central Costanera S.A. Av. España 3301 Ciudad Autónoma de Buenos Aires Generation of electric energy from: thermal energy (gaseous and liquid fuels).
Additionally, pursuant to Section 22 of Argentina’s
Environmental Policy Law No. 25,675, any individual or legal entity, whether public or private, engaged in activities that endanger the
environment, ecosystems and their constituent elements, including us, must carry insurance for an amount sufficient to cover the cost
of repairing the damages such individual or legal entity may cause. We fully comply with this regulation.
Safety and Hygiene
In managing occupational safety and health we
seek to protect people and our own and third parties’ property, assuming that:
· all accidents and occupational diseases can be prevented;
· compliance with applicable occupational and health standards is the responsibility of all individuals participating in activities in our facilities; and
· raising awareness among individuals contributes to the welfare at the workplace and to the improved individual and collective development of the members of the work community.
Our commitment to ongoing improvement compels
us to review the sufficiency of our current policy and its stated goals on an ongoing basis. ensuring its adequacy in light of the changes
required by the market and applicable laws.
In May 2025, TÜV Rheinland completed a series
of ISO recertification audits to expand the scope of the existing certificates and include two new sites: Lujan de Cuyo and San Lorenzo.
As of the date of this annual report, we hold the following certificates:
Standard: ISO 45001/2018
Certificate Register. No.: 01 21306 2329655
Certificate Holder: Central Puerto S.A. Calle
8 Colectora Norte, Ruta 11, Km455 Parque Industrial Sauce Viejo 3017 Santa Fe, Argentina.
Scope: Generation of electric energy from: hydraulic
energy, thermal energy (gaseous and liquid fuel) and wind Energy. Steam production. Operation and maintenance of extra high voltage line.
Validity: The certificate is valid from 2024-10-21
until 2027-10-04.
Including the locations:
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No: Name/Location Scope
1 Central Hidroeléctrica Piedra del Águila Ruta Nacional 237, Km 1450.5 8315 Piedra del Águila Provincia de Neuquén Generation of electric energy from: hydraulic energy
2 Central Puerto S.A. – Planta Brigadier Lopez Ruta 11 Km 455 3017 Parque Industrial Sauce Viejo, Calle 8, Colectora Norte Santa Fe–- Argentina Generation of electric energy from: thermal energy (gaseous and liquid fuels).
3 c/o Central Puerto S.A.–- para su subsidiaria Parque Eólico Achiras Lote 325, Parcela 1274 Lat 33° 12’ 44,23’’S, Long 65º 5’ 16,52 ’’ O Córdoba-Achiras, Argentina Generation of electric energy from: wind energy.
4 c/o Central Puerto S.A.–- para su subsidiaria Parque Eólico La Castellana Camino rural altura de la RN 3, Km 712,5’Lat. 38º 38 ́ 22,40’’S Long. 62º 43 ́1,04 ́ ́ O–- Villarino, Buenos Aires Argentina Generation of electric energy from: wind energy.
5 c/o Central Puerto S.A. para su subsidiaria Parque Eólico La Castellana II Ruta 3 km 712,5 sobre camino Vecinal Villarino, Buenos Aires, Argentina Generation of electric energy from: wind energy.
6 c/o Central Puerto S.A. para su subsidiaria Parque Eólico La Genoveva II Ruta 51 Km 705 Cabildo, Buenos Aires, Argentina Generation of electric energy from: wind energy.
7 c/o Central Puerto S.A. para su subsidiaria Parque Eólico Manque (Latitud 33°13’35.26”S; Longitud 65° 4’ 38.69”O) Achiras, Córdoba, Argentina Generation of electric energy from: wind energy.
8 c/o Central Puerto S.A. para su subsidiaria Parque Eólico Los Olivos (Latitud 33°15’50.34”S; Longitud 65° 2’59.94”O) Achiras, Córboba, Argentina Generation of electric energy from: wind energy.
9 c/o Central Puerto S.A. para su subsidiaria Parque Eólico Vientos La Genoveva I Ruta 51 Km 705 Cabildo, Buenos Aires Argentina Generation of electric energy from: wind energy.
10 Central Puerto S.A – Planta Mendoza (Centrales Lujan de Cuyo y Cruz de Piedra) Ruta 84 S/N Parque Industrial Provincial 5507 Lujan de Cuyo, Mendoza, Argentina Generation of electric energy from: thermal energy (gaseous and liquid fuels).
11 Central Puerto S.A – Planta Cogeneración San Lorenzo. Combate punta quebracho s/N, zona rural, Puerto Gral. San Martín, Santa Fe, Argentina Generation of electric energy from: thermal energy (gaseous and liquid fuels). Steam production and Operation and Maintenance of extra high voltage line
Certificate Register. No.: 01 21306 2329630
Certificate Holder: Central Costanera S.A. Av.
España 3301.Ciudad Autónoma de Buenos Aires
Scope: Generation of electric energy from: thermal
energy (gaseous and liquid fuel).
Validity: The certificate is valid until 2028-07-27
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Including the locations:
No: Name/Location Scope
1 Central Costanera S.A. Av. España 3301 Ciudad Autónoma de Buenos Aires Generation of electric energy from: thermal energy (gaseous and liquid fuels).
Integrated Management System with ISO Certifications
Our management has put an integrated management
system (“IMS”) in place for its electric power and steam generation plants in order to meet the needs and requirements of
our internal policies and goals, as well as the needs and requirements of our clients, the applicable laws and regulations and ISO standards,
namely, ISO 9001/2015 (quality), ISO 14001/2015 (environment) and ISO 45001/2018 (Occupational health and safety Assessment Series. Our
IMS is certified by renowned international entities and audited from time to time, as required by the aforementioned standards.
The IMS seeks to achieve the following goals:
· equip the plants with useful and proactive management tools;
· ensure process quality;
· satisfy clients’ requirements;
· pursue ongoing improvement in processes;
· safeguard people and our own and third party’s property;
· prevent pollution;
· make efficient use of resources;
· preserve the ecological balance; and
· improve life quality.
We identify the processes and the necessary support
for the accurate operation of a sustainable, participatory and bureaucracy-free IMS that is useful for implementing the principles established
by management with respect to environmental, quality, and occupational safety and health policies and for ensuring the availability of
human, material and financial resources. We have used a management model based on planning-doing-checking-acting in order to guarantee
the maintenance and ongoing improvement of the IMS in our facilities, which involves one or several of the following systems:
· Quality Management System
· Environmental Management System
· Occupational Safety and Health Management System
The individual scope of the IMS at each plant
is as follows:
· Puerto Complex:
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· Nuevo Puerto plant: Environmental Management System with ISO 14001/2015 certificate and Quality Management System with ISO 9001/2015 certificate · Puerto Nuevo plant: Environmental Management System with ISO 14001/20015 certificate and Quality Management System with ISO 9001/2015 certificate.
Certification body: From 2004 through 2015: IRAM From 2016-2026: TÜV Rheinland
· Luján de Cuyo plant: Environmental Management System with ISO 14001/2015 certificate and Quality Management System with ISO 9001/2015 certificate and Occupation Safety and Health Management System with ISO 45001/2018 (through May 2025) certificate.
Certification body: From 2004 through 2015: SGS From 2016 through 2026: TÜV Rheinland
· Piedra del Águila plant: Environmental Management System with ISO 14001/2015 certificate, Quality Management System with ISO 9001/2015 certificate and Occupation Safety and Health Management System with ISO 45001:2018 (through March 2021) certificate
Certification body: From 2004 through 2015: IRAM From 2016 through 2023 (through 2024 to ISO 45001): TÜV Rheinland
· Brigadier Lopez plant: Environmental Management System with ISO 14001/2015 certificate, Quality Management System with ISO 9001/2015 certificate and Occupation Safety and Health Management System with ISO 45001:2018 (through March 2021) certificate
Certification body: From 2019 through 2023 (through 2024 to ISO 45001): TÜV Rheinland
· Wind Farms Achiras, La Castellana I, La Castellana II and La Genoveva II: Environmental Management System with ISO 14001/2015 certificate, Quality Management System with ISO 9001/2015 certificate and Occupation Safety and Health Management System with ISO 45001:2018 (through July 2022) certificate.
Certification body: From 2019 through 2023 (through 2025 to ISO 45001): TÜV Rheinland
· Wind Farms Manque and Los Olivos: Environmental Management System with ISO 14001/2015 certificate, Quality Management System with ISO 9001/2015 certificate and Occupation Safety and Health Management System with ISO 45001:2018 (through July 2025) certificate.
Certification body: From 2020 through 2023 (through 2025 to ISO 45001): TÜV Rheinland
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· Wind Farms La Genoveva I: Environmental Management System with ISO 14001/2015 certificate, Quality Management System with ISO 9001/2015 certificate and Occupation Safety and Health Management System with ISO 45001/2018 (through July 2022) certificate.
Certification body: From 2024 through 2027: TÜV Rheinland
· Cogeneración San Lorenzo: Environmental Management System with ISO 14001/2015 certificate, Quality Management System with ISO 9001/2015 certificate and Occupation Safety and Health Management System with ISO 45001/2018 (through July 2024) certificate.
Certification body: From 2021 through 2025: TÜV Rheinland
· Central Costanera Complex: Environmental Management System with ISO 14001/2015 certificate, Quality Management System with ISO 9001/2015 certificate and Health Management System with ISO 45001/2018. Certification body: From 2024 through 2027: TÜV Rheinland
· Cordillera Solar Complex: Environmental Management System with ISO 14001/2015 certificate,
It is our policy that the IMS be reviewed upon
a change to our organizational structure, operating procedures, processes or facilities and that it be updated as applicable. Once updated,
the IMS is subject to a comprehensive review considering the existing interrelations to avoid overlap or omissions. Where no changes have
occurred, the IMS is reviewed every five years, unless a new version of the reference ISO standards is released during that period, in
which case the IMS is adjusted to conform to the new standards.
The Argentine Electric Power Sector
The following is a summary of certain matters
relating to the electric power industry in Argentina, including provisions of Argentine laws and regulations applicable to the electric
power industry and to us. This summary is not intended to constitute a complete analysis of all laws and regulations applicable to the
electric power industry. Investors are advised to review the summary of such laws and regulations published by the Secretariat of Energy
(https://www.argentina.gob.ar/economia/energia), CAMMESA (www.cammesa.com.ar) and the Ente Nacional Regulador de la Electricidad
(Argentine Electricity Regulatory Entity, or “ENRE”) (www.enre.gob.ar) and to consult their respective business and
legal advisors for a more detailed analysis. None of the information on such websites is incorporated by reference into this annual report.
History
For most of the second half of the 20th
century, the Argentine Government controlled the assets and operations of the country's electric power sector. By 1990, the public sector
controlled virtually all electric power supply in Argentina (97% of total generation). The Argentine Government regulated the industry
at the national level and controlled national electric power companies, while several provinces also operated their own utilities.
As part of the economic plan adopted by former
President Carlos Menem, the Argentine Government undertook an extensive privatization program covering all major state-owned industries,
including electric power generation, transmission, and distribution. Argentine Law No. 23,696 (passed in 1989) (the “Federal Reform
Law”) declared a state of emergency for all public services and authorized the Argentine Government to reorganize and privatize
public companies.
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The privatization policy had two primary objectives:
(i) reducing rates and improving service quality through free market competition and (ii) preventing concentration of control within each
market subsector to limit participants' ability to fix prices. Separate limitations and restrictions were imposed on each subsector to
achieve these goals.
Pursuant to the Federal Reform Law, Decree No.
634/1991 established guidelines for: (a) decentralizing the electric power industry; (b) structuring the electric power market; and (c)
enabling private sector participation in the generation, transmission, distribution, and trading subsectors.
General Overview of Legal Framework
Key Statutes and Complementary Regulations
The body of rules that constitutes the basic
regulatory framework of the Argentine electric power sector currently in force are the following: (i) Law No. 15,336, enacted on September
20, 1960, as amended by Law No. 24,065, passed on December 19, 1991, partially promulgated by Decree No. 13/92, and regulated by Decree
No. 1398/92 and Decree No. 186/95 (collectively, the “Regulatory Framework”), (ii) Law 24,065, as amended through Decree No.
450/2025, which implemented privatizations of government-owned companies in the electric power sector and separated the industry vertically
into four categories: generation, transmission, distribution and demand, and it also provided for the organization of the WEM (described
in greater detail below) based on the guidelines set forth in Decree No. 634/91; and (iii) Decree No. 186/95 also created the notion of
“participant,” among which it is worth mentioning the “trader,” which is defined as a company that is not a WEM
agent but trades electric power in bulk; (iv) Decree No. 55/23 declared an emergency in the generation, transportation and distribution
segments of electric energy, as well as in the transportation and distribution of natural gas under federal jurisdiction, until December
31, 2024, which was then extended by Decree No. 1023/2024 and Decree No. 370/25 until July 9, 2026, and it also instructed the Secretariat
of Energy to develop, enact and implement a program of necessary actions, with the stated purpose of establishing price sanction mechanisms
under competitive conditions, maintaining revenue levels and covering investment needs to guarantee the continued provision of public
utilities for the transportation and distribution of electric power and natural gas; and (v) Law No. 27,742, which declared a public emergency
in administrative, economic, financial and energy matters until July 2025.
In addition to the regulations previously mentioned,
it is important to highlight that, in response to the economic crisis that Argentina experienced between 2001 and 2002, the Argentine
Government has declared, ever since, several public emergencies in the context of which a series of significant measures were introduced
to the regulatory framework applicable to the electricity sector. These measures have had significant adverse effects on electricity generation,
distribution and transmission companies.
Procedures for the Programming of Operation,
Dispatch and Price Calculation
For the purposes of implementing the provisions
set forth in the Regulatory Framework, a set of regulatory provisions were issued, through Resolution No. 61 of April 29, 1992 of the
former Secretariat of Electric Energy, which are referred to as the “Procedures for the Programming of Operation, Dispatch and Price
Calculation” (the “Procedures”). The Procedures have been amended, supplemented and extended by subsequent resolutions
issued by the relevant authorities.
Recently, Decree No. 450/2025 provided for the
Secretariat of Energy to issue the necessary regulations to review the Procedures, for purposes of determining their repeal or their maximum
term of validity, during the 24-month transition period established by the aforementioned Decree.
Accordingly, on October 21, 2025, Secretariat
of Energy Resolution No. 400/2025 was published in the Official Gazette, whereby the “Rules for the Normalization of the MEM and
its Progressive Adaptation” were approved, applicable to the Economic Transactions of the MEM as from November 1, 2025.
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Provincial Regulatory Powers
Provinces regulate the electrical system within
their territories and are enforcement authorities in charge of granting and controlling electric power distribution concessions therein.
Nonetheless, if a provincial electric power market participant is connected to the SADI, it must also comply with federal regulations.
In general terms, provinces have followed federal regulatory guidelines and have established similar regulatory institutions. In addition,
isolated provincial electric power systems are very rare, and most provincial market participants are connected to the SADI and buy and
sell electric power in the WEM, which falls within the regulatory powers of the Argentine Government.
Regulatory entity – ENRE and the
creation of the new Argentine National Gas and Electricity Regulator
Law No. 24,065 also created the Ente Nacional
Regulador de la Electricidad (Argentine National Electricity Regulator) (ENRE) as an autonomous entity within the scope of the current
Secretariat of Energy. In July 2024, Law No. 27,742 established the creation of the Ente Nacional Regulador del Gas y la Electricidad
(Argentine National Gas and Electricity Regulator) (“ENGRE”), which, once constituted, will replace and assume the
functions of the ENRE and ENARGAS, pursuant to art. 161.
The main duties of the ENRE are the following:
(a) enforcing the Regulatory Framework and controlling the rendering of public services and the performance of the obligations set forth
in the concession contracts at a national level; (b) issuing the regulations applicable to the WEM agents; (c) setting forth the basis
for calculation of tariffs and approving the tariff schedules of transmission and distribution companies holding national concessions;
(d) authorizing electrical conduit easements; and (e) authorizing the construction of new facilities. Besides, Law No. 24,065 has entrusted
ENRE with jurisdictional activity. Any dispute arising between WEM agents should be subject to prior compulsory jurisdiction of ENRE (subject
to further judicial review).
Pursuant to art. 58 of Law No. 24,065, regulated
by Decree No. 1398/92, ENRE’s board of directors should be composed of five (5) members, who shall be elected through a selection
procedure by open call (convocatoria abierta) among professionals who have the required curricular background. However, in 2019,
Section 6 of the Solidarity Law No. 27,541 authorized the Argentine Government to intervene ENRE’s board for one year. Since then,
the ENRE has been intervened by virtue of Decrees No. 277/2020, 1020/2020, 871/2021, 815/2022 and recently, Decrees No. 55/2023, 1023/2024
and 370/25, issued by the Milei administration, until July 9, 2026, or until the new regulatory entity has been duly constituted and is
fully operational and the members of its Board of Directors have been appointed (whichever occurs first).
On July 4, 2025, through
Decree No. 452/2025, the Argentine Government ordered the creation of the ENGRE. The ENGRE will be governed and administered by a Board
of Directors composed of five members: a President, a Vice-President, and three Directors, each appointed for a five-year term, with indefinite
eligibility for reappointment. The selection process for the members of the Board of Directors will be conducted by the Secretariat of
Energy, which will submit its recommendation to the Argentine Government for final approval of the Board’s members. Pursuant to
Decree No. 452/2025, the ENGRE must be operative within 180 calendar days from the publication of its creation in the Official Gazette.
The new authority will
enjoy administrative autonomy and independence in terms of budget and operating, as well as full legal capacity to act under both public
and private law. Its assets will consist of those transferred to it and those it may acquire in the future. In its relations with private
parties and with the Argentine Government, the ENGRE will be governed by the procedures set forth in the National Administrative Procedures
Law No. 19,549, except as otherwise expressly provided in the applicable regulatory frameworks and their implementing regulations.
Until the ENGRE approves
its organizational structure, the ENRE will remain in force and will continue to exercise its assigned responsibilities, powers, and functions
in order to ensure the continuity of operational activities. As of this date, the new authority is not yet operative, as the members of
its Board of Directors have not yet been appointed.
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Pursuant to Decree No.
452/2025, the Board of Directors of the new authority will be able to:
a. enforce and oversee compliance with the legal and regulatory provisions governing the ENGRE’s activities;
b. adopt the ENGRE’s internal bylaws;
c. advise the Argentine Government on all matters within the authority’s jurisdiction;
d. hire and remove the ENGRE’s personnel and determine their duties and employment conditions;
e. prepare the annual operating budget and resource forecast, to be submitted to the Argentine Government for approval and inclusion in the draft National Budget Law for the relevant fiscal year;
f. prepare its annual report and financial statements;
g. impose the sanctions provided for under the gas and electricity regulatory frameworks and their implementing regulations; and
h. generally, to perform all other acts necessary for the fulfillment of the ENGRE’s functions and the objectives set forth in the applicable regulatory frameworks.
The Secretariat of Energy
In addition to the ENRE, one of the main regulatory
entities in Argentina is the Secretariat of Energy.
Its role is defined in Law No. 24,065 and Decree
No. 50/2019. Pursuant to Decree No. 50/2019 (as amended, particularly by Decree No. 480/2022), the Secretariat of Energy, currently under
the orbit of the Ministry of Economy, has overall responsibility for organizing the electricity industry and establishing the policies
applicable to the sector, among other objectives according to Decree No. 293/2024. Within the scope of the Secretariat of Energy, the
Undersecretariat of Electric Energy is in charge of assisting the enforcement authority.
CAMMESA
The creation of the WEM made it necessary to
create an entity in charge of the management of the WEM and the dispatch of energy into the SADI. These duties were entrusted to CAMMESA,
created by virtue of Decree 1192/1992, as a non-profit corporation. Each of the shareholders of CAMMESA hold twenty percent of its shares
and are as follows: the Argentine Government (represented by the Secretariat of Energy) and the four associations representing the different
segments of the electric power sector (generation, transmission, distribution and large users).
CAMMESA is managed by a board of directors composed
of ten regular directors and up to ten alternate directors, which are appointed by its shareholders. Each of the associations that represent
the different segments of the electric power sector is entitled to appoint two regular directors and two alternate directors. The two
remaining regular directors of CAMMESA are the current Secretariat of Energy, who serves as chairman of the board and an independent member
who acts as vice chairman, appointed at a meeting of the shareholders. The decisions adopted by the board of directors of CAMMESA require
the affirmative vote of a majority of the directors present at the meeting, including the affirmative vote of the chairman of the board.
CAMMESA is in charge of managing the SADI in
accordance with the Regulatory Framework.
In addition, under current applicable regulations,
CAMMESA has been tasked with the role of acquiring and supplying the fuel for the electric power sold under the Spot Sales free of cost
to the generators.
Pursuant to Resolution No. 2022/2005, the Secretariat
of Energy had the power to define the regulatory instructions and mandates that could be issued to CAMMESA. This power was revoked by
Resolution No. 150/2024, published in the Official Gazette on July 10, 2024. The purpose was to gradually channel the National Electric
Sector towards the guiding principles of the Regulatory Framework (especially Laws. No. 15,336 and 24,065) and reduce the intervention
of the Argentine Government in the electric power market.
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WEM (Wholesale Electricity Market)
Transactions among different participants in
the electricity industry take place in the WEM, administrated by CAMMESA, which clears all transactions as a power pool administrator.
The WEM was originally conceived as a competitive market in which generators, distributors and certain large users of electricity could
buy and sell electricity at prices determined by supply and demand, and were also allowed to enter into medium and long-term power purchase
contracts.
The WEM consisted mainly of:
1. a term market, where contractual quantities, prices and conditions were freely agreed upon among sellers and buyers;
2. a spot market, where prices were established on an hourly basis based on the economic production cost, represented by the short-term marginal cost measured at the system’s load center (market node) (however, in practice, this system has suffered significant regulatory distortions since the year 2002). Purchases made in the spot market vary according to the nature of the buyer: large users, generators and self-generators pay the Spot Price, while distributors pay a seasonal price calculated by CAMMESA and approved by the Secretariat of Energy. Seasonal prices are periodically established by the Secretariat of Energy based on the programming made by CAMMESA, and maintained for six-month periods (subject to quarterly adjustments), in order for distributors to pay a stabilized price, and thus be able to transfer it to the tariffs paid by end users. It should be noted that since 2002, this price is not transferred in full to demand agents of the WEM, which in turn leads to relevant deficits in the stabilization fund administered by CAMMESA. Finally, the electricity remuneration values for generators (Spot Sales) are set by the Argentine Government; and
3. a quarterly stabilization system of spot market prices, managed by CAMMESA, intended for the purchases of electric power by distributors.
The following chart shows the relationships among
the various actors in the WEM:
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__________________
Source: CAMMESA.
Recently, within the framework of Decree No.
450/2025, and the guidelines issued to CAMMESA, the Secretariat of Energy issued Res. No. 400/2025, published in the Official Gazette
on October 21, 2025. The resolution approved the “Rules for the Normalization of the MEM and Its Progressive Adaptation”,
which apply to WEM economic transactions as from November 1, 2025.
The main amendments introduced by Resolution
No. 400/2025 include the following:
· Redefinition of the structure of distributor-supplied demand in the WEM, dividing it into two categories: (i) Distribution Large User Demand (Grandes Usuarios de Distribución – GUDI, consumption ≥ 300 kW), and (ii) Seasonal Distribution Demand (“DEDMEM”), which includes residential and non-residential users that do not yet procure energy independently.
· Establishment of priority supply of DEDMEM through “Assigned Generation” with any remaining demand to be covered through the Spot Market or distributors’ forward contracts. Assigned Generation includes: generation plants with existing PPAs (thermal and renewable, including those under Res. SE No. 220/2007, 21/2016, 287/2017, FONINVEMEM, GENREN, RenovAr, RenMDI and MiniRen programs), nationally granted and binational hydroelectric plants (Yacyretá and Salto Grande), nuclear generation (NASA), and centralized imports. The costs of Assigned Generation are passed through to DEDMEM through stabilized prices.
· Granting absolute priority to residential demand in the allocation of Assigned Generation. Non-residential demand will be supplied with the remaining Assigned Generation and, in the event of a shortfall, distributors must procure energy through Spot Market purchases or bilateral contracts in the term market.
· Classification of all non-assigned generation as Spot Generation, operating under a competitive regime with prices determined on a marginal cost basis:
o Thermal and renewable plants will migrate to this regime upon expiration of their existing contracts and may sell energy either in the Spot Market or through term market contracts.
o Hydroelectric and nuclear plants will continue to be governed by specific regulatory regimes.
o Provincially owned plants may freely participate in both markets.
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· Creation of the “New Generation” category, applicable to facilities achieving commercial operation after January 1, 2025. New Generation benefits from pro-competition rules (e.g., full rent factor recognition for energy) and may be eligible, subject to approval, for participation in the Additional Reliability Reserve Service, with specific capacity remuneration and location requirements.
· Approval of a new energy and capacity remuneration scheme for both Spot Generation and Spot Demand, based on marginal price signals reflecting actual supply costs, with transitional adjustment factors.
· Relaunch of the Energy and Capacity Term Market, enabling bilateral contracts among generators, distributors, and large users to cover both variable costs (energy) and fixed costs (capacity).
· Implementation of a transitional fuel management regime.
· Specific treatment for state-administered assets: ENARSA-owned thermal plants (including San Martín and Belgrano) are allocated to supply the Spot Market until privatization; combined-cycle units subject to availability agreements (Res. No. 59/2023) will maintain their current regime unless they opt into the new framework.
· Creation of two system reliability reserve services:
o the Base Reliability Reserve Service, applicable to existing thermal generation, with remuneration of US$ 1,000 per MW-month (subject to exclusions); and
o the Additional Reliability Reserve Service, aimed at new hydro/termal generation or storage capacity, with remuneration of US$ 9,000 per MW-month for up to ten years, subject to regulatory approval and location-needs of the SADI.
Structure of the Industry
Generation
According to Law No. 24,065, electric power generation
is classified as an activity of general interest associated with the provision of the public service of transmission and distribution
of electric power but conducted within the framework of a competitive market.
Thermal electric power generators (i.e.,
generation using natural gas, liquid fuels derived from oil, such as gas oil and fuel oil, coal, solar panels or wind turbines) do not
need a concession granted by the government to operate, whereas hydroelectric power generators do need a concession granted by the government
to be able to use water sources. Typical terms included in concession agreements include the right to use water resources and facilities
for a fixed amount of time (e.g., thirty years), in cases where the dam is owned by the Argentine Government or an Argentine provincial
government, and the option to extend or renew the concession period for a fixed number of years. Usually, the concessionaire must make
a one-time initial payment to the Argentine Government or an Argentine provincial government in exchange for the rights granted in the
concession and periodically must pay a fee and/or royalties to the respective provincial government where the river is located in exchange
for the use of this water resource. Normally, these periodic fees vary according to the amount of energy generated.
Following the enactment of Res. No. 95/2013,
the incorporation of new PPAs in the term market was suspended, except for those power purchase agreements executed under certain special
regimes. However, more recently, Resolution 21/2025 introduced a new exception to the temporary suspension and stipulated that, effective
from January 1, 2025, projects for the generation, self-generation, or cogeneration of electricity from thermal, hydroelectric, or nuclear
sources may enter into PPAs in the WEM, and manage them in accordance with the 'Procedures for the Scheduling of Operations, Load Dispatch,
and Price Calculation’. See “Item 4.B. Business Overview—The Argentine Electric Power Sector—Remuneration Scheme”
below.
In addition, it should be noted that in recent
years, Argentina has prioritized the generation of electric power from renewable sources. In such regard, it has not only issued regulations
intended to regulate and incorporate this type of energy into the WEM, but it has also promoted it by granting incentives in the form
of tax benefits and preferential or subsidized tariffs.
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In this regard, through the enactment of Law
No. 26.190 in December 2006, amended and supplemented by Law No. 27.191, both regulated by Decree No. 531/2016, the generation of electric
energy from the use of renewable energy sources for public service provision was declared to be of national interest. See “Item
4.B. Business Overview—The Argentine Electric Power Sector—Structure of the Industry—Renewable Energy” below.
Within this framework, the Argentine Government
launched a series of bidding processes for the development of renewable power generation projects—See “Item 4.B. Business
Overview—The Argentina Electric Power Sector— RenovAR (Round 1, Round 1.5 and Round 2): Bidding Process for Renewable Energy
Generation Projects”—, and also implemented the Renewable Energy Term Market by means of Resolution No. 281-E/2017 of the
former Ministry of Energy and Mining—See “Item 4.B. Business Overview—The Argentina Electric Power Sector— The
Renewable Energy Term Market in Argentina - Resolution No. 281-E/17”.
Transmission and Distribution
Pursuant to Law No. 24,065, transmission and
distribution activities are regulated as public services due to the fact that they are natural monopolies. The Argentine Government has
granted concessions to private entities conducting these activities, subject to certain conditions, such as service quality standards
and fixing the tariffs they are entitled to collect for their services.
Electricity transmission is comprised of (i)
a high-voltage transmission system, operated by the company Transener, which connects the main electric power production and consumption
areas allowing the transmission of electric power between different Argentine regions and (ii) several regional trunk systems, which transmit
electric power within a particular region and connect the generators, distributors and Large Users that operate in such region.
Electricity distribution is regulated only at
the federal level for the City of Buenos Aires and the districts in the metropolitan areas of Greater Buenos Aires. EDENOR operates in
the northern area of both the City of Buenos Aires and Greater Buenos Aires, and EDESUR operates in the southern area of both the City
of Buenos Aires and Greater Buenos Aires. In the rest of the country, the electric power distribution service is regulated at the provincial
level and subject to concession granted by provincial authorities. Section 124 of Law No. 27,467 established that both EDENOR and EDESUR
would be transferred to the regulatory jurisdiction of the Province of Buenos Aires and the City of Buenos Aires, as applicable. However,
such transfer was not implemented, and was later suspended by the Solidarity Law that established that the ENRE will retain its regulatory
powers over such companies for as long as the emergency declared by such law remain in force.
Transmission services are rendered by concessionaires
that operate and use high and medium voltage transmission lines. Transmission services consist of the transformation and transmission
of electric power from generators’ delivery points to distributors or Large Users’ reception points. Law No. 24,065 provides
that electricity transmission companies must be independent from other WEM participants and prohibits them from purchasing or selling
electricity.
Distribution companies are in charge of supplying
electric power to end-users who cannot contract with an independent electric power supply source due to their consumption levels, such
as residential end-users.
The main characteristics of concession contracts
for the transmission and distribution of electric power are: (i) service quality standards with penalties that are applied in case of
breach; (ii) a concession term of 95 years for the monopoly of the supply service in a supply area or network, divided into “management
periods,” with an initial term of 15 years and subsequent terms of ten years (at the end of each management period, the Argentine
Government must call for bids to sell the majority stake of the corresponding transmission or distribution company); and (iii) tariffs
fixed based on economic criteria with a price cap system and predefined processes regarding their calculation and adjustment.
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Large Users
The WEM classifies Large Users of energy into
three categories: (i) Grandes Usuarios Mayores (Major Large Users, or “GUMAs”), (ii) Grandes Usuarios Menores
(Minor Large Users, or “GUMEs”) and (iii) Grandes Usuarios Particulares (Particular Large Users, or “GUPAs”).
GUMAs are users with a maximum capacity equal
to or greater than 1 MW and a minimum annual energy consumption of 4,380 MWh. Their transactions in the spot market are invoiced by CAMMESA.
GUMEs are users with a maximum capacity ranging
from 0.03 to 2.0 MW. They are not required to have any minimum annual demand.
GUPAs are users with a minimum capacity of 0.030
MW and a maximum of 0.1 MW. They are not required to have any minimum annual demand.
Traders
Since 1997, traders have been authorized to participate
in the WEM by intermediating block sales of energy.
Vertical and Horizontal Restrictions
The WEM agents are subject to vertical restrictions,
pursuant to Law No. 24,065 and Decree No. 1398/92, according to which:
1. neither a generation or distribution company nor a Large User or any of its controlled companies or its controlling company, can be an owner or a majority shareholder of a transmission company or the controlling entity of a transmission company. Nevertheless, the Argentine Government may authorize a generation or distribution company or a Large User to build, at its own cost and for its own need, a transport network for which it will establish the modality and form of operation.
2. the holder of a distribution concession cannot be the owner of generation units; however, the shareholders of the electric power distributor may own generation units, either by themselves or through any other entity created with the purpose of owning or controlling generation units; and
3. no transmission company may purchase or sell electricity.
Section 33 of the Argentine Corporate Law states
that “companies are considered as controlled by others when the holding company, either directly or through another company: (1)
holds an interest, under any circumstance, that grants the necessary votes to control the corporate will in board meetings or ordinary
shareholders’ meetings; or (2) exercises a dominant influence as a consequence of holding shares, quotas or equity interest or due
to special linkage between the companies”. However, we cannot assure you that the electric power regulators will apply this standard
of control in implementing the restrictions described above. According to the ENRE resolutions, a company controlled by or controlling
an electric power transmission company is a company that owns more than 51.00% of the voting shares of the controlled company and exercises
a majority control.
Both electric power transmitters and distributors
are also subject to horizontal restrictions. The horizontal restrictions applicable to transmission companies are the following:
1. two or more transmission companies can merge into or be part of a same economic group only if they obtain an express approval from the ENRE; such approval is also necessary when a transmission company intends to acquire shares in another electric power transmission company;
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2. pursuant to the terms of the concession agreement that govern the transmission of electric power through transmission lines above 132 kv and below 140 kv, the transmission service is rendered exclusively in the specific areas indicated in such agreement; and
3. pursuant to the terms of the concession agreement of the company that renders electric power transmission services through lines with voltage equal to or higher than 220 kv, the service must be rendered exclusively and without territorial restrictions, throughout Argentina.
The horizontal restrictions applicable to electric
power distribution companies are the following:
1. two or more distribution companies can merge into or be part of a same economic group only if they obtain an express approval from the ENRE; such approval is also necessary when a distribution company intends to acquire shares in another electric power distribution company; and
2. the distribution service is rendered within the areas specified in the respective concession contracts.
Import and Export Transactions
Pursuant to Decree No. 974/97, import and export
transactions are conducted through the TEII (Sistema de Transporte de Energía Eléctrica de Interconexión Internacional),
a public service subject to the concession granted by the former Secretariat of Electric Energy. Under such system, through Resolution
No. 348/99, the former Secretariat of Electric Energy granted Interandes Sociedad Anónima a concession for the TEII through the
Güemes Transmission System, which connects the Central de Salta Thermal Generation plant located in Güemes, Salta, with the
Sico Border Crossing, on the border with the Republic of Chile.
All import and export transactions conducted
through the term market require the prior authorization of the Undersecretary of Electric Energy and CAMMESA. This authority is currently
held by the Undersecretary of Electric Energy under the terms of the powers conferred by point IX of Decree No. 50/2019 (amended by Decree
No. 804/2020).
Electricity Dispatch and Spot Market Pricing
prior to Res. No. 95/13
According to the Regulatory Framework, an electric
power generator’s remuneration was a function of two components: (1) a variable component, based on quantity of energy sold in the
market, and (2) a fixed component that aims to remunerate the generator for each MW of capacity of its units available per hour in the
WEM, regardless of the consumption of the electric power generated by such units. The value of the fixed component depended on, among
other things, the connection node to which the unit connects to the SADI.
In accordance with the spot market that was in
place prior to Spot Sales, electric power was traded at prices reflecting supply and demand. CAMMESA dispatched the available power units
based on the variable costs of production determined by the generation agents, either based on the cost of fuel or the price of water
determined, dispatching the most efficient power units first. The spot market price was determined by CAMMESA on an hourly basis at a
specific geographic location, referred to as the “market node,” which is located in the system’s load center at Ezeiza,
Province of Buenos Aires. The energy price consisted of a value referred to as the “marginal system price” or “market
price,” and represented the economic cost of generating the next MWh to satisfy an increase in demand at the same value. The seasonal
price fixing system was directly related to the quarterly average prices of the spot market.
However, in practice, the Spot Market pricing
mechanisms have suffered significant changes since 2002, and by means of Resolution of the Secretariat of Energy No. 95/2013, relevant
changes were made to the remuneration of the generation sector, transforming the system into a “cost plus” regime, in which
generators were remunerated on the basis of variable “non-fuel” costs, fixed costs and an additional margin. In addition,
Resolution No. 95/2013 prohibited generators to purchase their own fuel, with CAMMESA being the only buyer and administrator of fuel.
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The remuneration regime for electricity generation
was modified and supplemented by numerous resolutions in the years that followed: (i) Res. No. 529/14, (ii) Res. No. 482/2015, (iii) Res.
No. 22/2016, (iv) Res. No. 19/17 (which established a remuneration scheme in US dollars); (v) Res. No. 1/19 (which maintained the
scheme in US dollars); (iv) Res. No. 31/20 (which re-established a remuneration scheme valued in Argentine pesos), and through several
other resolutions, the most recent being Res. No. 602/2025.
More recently, Resolution No. 21/2025, published
in the Official Gazette on January 28, 2025, amended certain provisions of Resolution No. 95/2013. It established that the commercial
management and fuel dispatch for thermal generators with supply contracts without the obligation of self-management will remain the responsibility
of CAMMESA. However, for thermal generators operating in the spot market, the prohibition on acquiring their own fuel was lifted, with
CAMMESA remaining as the supplier of last resort. Furthermore, it stipulated that the costs associated with managing proprietary fuels
will be valued based on the reference prices declared in the 'Declaration of Variable Production Costs,' including freight, transportation,
natural gas distribution, taxes, and related fees.
The Stabilization Fund
Energy prices are passed on to end-users through
the public utility distribution companies. To fix prices for end-users, CAMMESA analyzes electric power supply and demand for the period
for which the price is being calculated. The seasonal price is a fixed quarterly price. The Regulatory Framework created the Stabilization
Fund that absorbs the differences between the seasonal price and the spot price in the WEM. When the seasonal price is higher than the
spot price, there is an accumulated surplus in the Stabilization Fund. Any surplus is used to offset any losses resulting from periods
during which the spot price has been higher than the seasonal price. However, due to tariffs’ public policies, the Stabilization
Fund has been in deficit since 2003.
Emergency of the Electric Power Sector
The electric power sector has been significantly
affected by the Public Emergency Law enacted on January 6, 2002, and the measures adopted as a consequence thereof. As a result of the
law, electric power transmission and distribution tariffs were converted into pesos and frozen for more than six years. They were only
subject to limited and small-scale increases.
Since the approval of the Public Emergency Law,
a series of temporary provisions amended the original mechanism for the determination of prices in the WEM. The measures adopted pursuant
to the Public Emergency Law also distorted this mechanism: in spite of an increase in the spot price, the seasonal price remained frozen
for all users until 2004, when a partial adjustment was adopted that did not affect residential demand. As a result, the amounts collected
based on seasonal prices have been lower than the amounts based on spot prices, therefore increasing the Stabilization Fund deficit.
In addition, the remuneration to power generators
was maintained at artificial low levels through regulations that, among other measures, sets a cap on spot prices freezing the capacity
payments.
On December 15, 2015, through Decree 134/2015
the Argentine Government declared a state of emergency with respect to the Argentine electric power sector until December 31, 2017.
On December 20, 2019, the Solidarity Law No.
27,541 was enacted, which once again declared a public emergency in tariff and energy matters, extending such declaration to the economic,
financial, fiscal, administrative, pension, health, and social fields, delegating to the Argentine Government a variety of powers to fulfill
the objectives envisaged in the regulation.
On December 18, 2023, the Argentine Government
(under the Milei Administration) issued Decree No. 55/2023 which (i) declared a state of emergency in the segments of electricity generation,
transmission, and distribution, as well as in the transmission and distribution of natural gas under federal jurisdiction until December
31, 2024; (ii) initiated the process for tariff review for providers of electricity and natural gas transmission and distribution services;
and (iii) order the intervention of ENRE and ENARGAS. The emergency was extended through Decrees 1023/2024 and Decree 370/2025 until
July 9, 2026.
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Law No. 27,742, within
the framework of the energy emergency declared in its Section 1, empowered the Argentine Government to adjust the Regulatory Framework
for a period of one year, in order to:
· Promote the opening of international trade of electric energy, guaranteeing safety and reliability.
· Ensure free commercialization and competition in the industry, allowing end users to choose their supplier.
· Promote the economic dispatch of energy transactions based on hourly economic costs.
· Adjust energy tariffs according to the real costs of supply in order to guarantee investment and the continuous provision of public services.
· Explain the payment concepts for the end user and establish the distributor as the agent for the collection and withholding of amounts.
· Guarantee the development of energy transportation infrastructure through open and competitive processes.
· Modernize and professionalize the structures of the electric sector, reorganizing the Federal Electric Energy Council as a non-binding advisory body.
Moreover, Resolution No.
294/2024 of the Secretariat of Energy, published in the Official Gazette on October 2, 2024, established the 'Contingency and Preparation
Plan for the Critical Months of the 2024/2026 Period' (the Contingency Plan). The Contingency Plan aims to prevent, reduce, and mitigate
potential challenges in the energy supply during critical days within the 2024/2026 period, outlining specific actions to be carried out
by the Ministry of Energy (SE) in the generation, transmission, and distribution sectors of electricity.
On May 24, 2024, we reported
that we entered into an agreement with CAMMESA within the framework of resolutions issued by the SE in connection with the debts of CAMMESA
for transactions corresponding to the months of December 2023 and January and February 2024, by virtue of which outstanding debts were
paid by CAMMESA. Such debt was paid through the delivery of public securities ("BONDS OF THE ARGENTINE REPUBLIC IN US DOLLARS STEP
UP 2038" (BONO USD 2038 L.A.)) and funds available in bank accounts enabled in CAMMESA within 48 hours from the signing of the agreement.
As of the date of this annual report, there are no outstanding liabilities in connection with this agreement.
The FONINVEMEM and Similar Programs
In 2004, the Argentine Government, seeking to
increase generation capacity, created the FONINVEMEM (Res. No. 712/2004), a fund to be administered by CAMMESA. To provide capital
for the FONINVEMEM, the former Secretariat of Electric Energy invited all WEM participants holding LVFVDs (Liquidaciones de Venta con
Fecha de Vencimiento a Definir, as per Res. No. 406/2003 and 943/2003) that originated from amounts owed by CAMMESA’s to generators
from the period January 2004 to December 2006, to contribute these credits to the FONINVEMEM. In the initial stages of the FONINVEMEM,
generators had to participate in the construction of two new 800 MW combined cycle thermal generation plants. Consequently, on December
13, 2005, the generation companies TMB and TJSM were created. Subsequently the generators also contributed the LVFVDs from 2007 to said
projects.
The FONINVEMEM reimburses the private sector
contributors the amount of their contributed receivables in 120 equal, consecutive monthly installments starting from the commercial launch
date of the plants, converted into U.S. dollars at the rate effective as of the date of the applicable agreement, with interest at the
interest rate specified in the applicable agreement for each project. For further information, see “Item 4.B. Business Overview—FONINVEMEM
and Similar Programs”.
Subsequently, in 2010, a new agreement with
WEM generators was entered into to promote new electric power generation to satisfy the increase in the energy and capacity demand and
also to facilitate the settlement of the generators’ receivables from CAMMESA (LVFVDs) for electric power sales. Within the framework
of such agreement, Central Puerto and the Endesa and Duke groups participated in a project for the construction of a thermal combined
cycle plant named Central Vuelta de Obligado, in Timbúes, Province of Santa Fe, and, in turn, The AES Group was part of a project
for the construction of Central Guillermo Brown, located in Bahía Blanca, Province of Buenos Aires. In connection with the former,
the generation company CVOSA was created.
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Energía Plus
In September 2006, the Secretariat of Energy
issued Resolution No. 1281/06 which created the Energía Plus Service, to respond to the sustained increase in energy demand and
to foster new private sector interested parties to invest fresh capital into the energy sector in order to generate new energy sources.
Nevertheless, this regime was recently repealed through Res. No. 21/2025 of the Ministry of Economy.
Res. No. 1281/06, which created the Energía
Plus Service, provided that:
1. The energy available in the market will be used primarily to serve residential customers, public lighting, public entities and industrial and commercial users whose energy demand is at or below 300 kW and that have not entered into term contracts.
2. GUMAs, GUMEs and large customers of distribution companies (in all cases with consumption equal or higher than 300 kilowatts) are allowed to satisfy any consumption in excess of their base demand (equal to their demand in 2005) with energy from the Energía Plus service, consisting of the supply of additional energy generation from new generators and generation agents, co-generators or self-generators that are not agents of the WEM or who, as of the date of publication of the resolution, were not interconnected with the WEM. The price required to pay for excess demand, if not previously contracted for under the Energía Plus, was originally fixed to be equal to the marginal cost of operation. The marginal cost is equal to the generation cost of the last generation unit transmitted to supply the incremental demand from electric power at any given time. With the Energía Plus, the price has been amended to for GUMAs and GUMEs and has been maintained for large customers of distribution companies for their excess demand (Note No. 111/16 issued by the former Secretariat of Electric Energy).
Even though this regime is no longer in force,
Res. No. 21/2025 provided that the execution of new contracts or the renewal of existing contracts in the term market, under the Energía
Plus Service modality could only occur until October 31, 2025. Existing contracts under this modality will remain in force and continue
to be in force under their current terms and conditions until their respective expiration.
PPAs for additional generation and associated
energy from generation – Secretariat of Energy - Resolution 220/07
Pursuant to Resolution No. 220/07, the Secretariat
of Energy authorized the execution of Power Purchase Agreements (“PPAs”) between the WEM (represented by CAMMESA) and companies
that offer additional generation to the system (i.e., the so-called offer of additional generation and associated energy from generation,
co-generation and self-generation agents that, as of the date of publication of the resolution, were not WEM agents or did not have the
generation facilities to commit to such supply). PPAs are applicable to all such projects for additional energy generation that involved
the participation of the Argentine Government or ENARSA or those that be determined by the former Ministry of Federal Planning, Public
Investment and Services (currently, the Secretariat of Energy).
Resolution No. 220/07 sets forth the standard
terms of PPAs, including:
1. Effective Term: Maximum of ten years.
2. Parties: The company whose offer has been approved by the former Secretariat of Electric Energy, as seller, and the WEM as a whole, represented by CAMMESA, as buyer.
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3. Remuneration: To be determined based on the costs accepted by the former Secretariat of Electric Energy and approved by the former Ministry of Planning.
4. Delivery Point: The connection node of the plant with the SADI.
5. Remedies: The PPAs must include remedies for breach based on the effect that the unavailability of the units committed under the PPAs may have on the proper supply of the electric power demand in the SADI.
6. Dispatch: The machines and plants assigned to the PPAs will generate electric power to the extent they are dispatched by CAMMESA.
Call for Bids for New Thermal Generation
Capacity and Associated Electricity Generation
As of the date of this annual report, there are
no new thermal generation capacity or associated electricity generation bids ongoing or announced.
By means of Res. No. 21/16, the former Secretariat
of Electric Energy called for bids for thermal generation capacity and associated electric power generation. The energy was to be made
available in the WEM to meet essential demand requirements beginning with the following seasons: summer 2016/2017, winter 2017 and summer
2017/2018.
Res. No. 21 sets forth the guidelines for wholesale
demand contracts, which included, among other things, the following terms: (i) the contractual term is required to be between five and
ten years; (ii) the maximum specific consumption of each generating unit by type of fuel used is required to be lower than 2,500 kilocalories
per kilowatt-hour; (iii) a set of remedies are required to be defined for failures to comply with the committed availability of generation
capacity; (iv) the supply of and recognition of the cost of fuel used by the machines and power plants involved is required to be included
in accordance with applicable regulations; (v) contracts are required to have first priority in payment and rank equally with existing
supply agreements with BICE in its role as trustee of the trusts “Central Termoeléctrica Manuel Belgrano” and “Central
Termoeléctrica Timbúes” since January and February 2010, respectively, and priority in payment must rank equally with
payment obligations in respect of liquid fuel purchases for electric power generation; and (vi) the contracts are required to include
other features stemming from the provisions of Resolution No. 21.
In accordance with Res. No.21, the former Secretariat
of Electric Energy received bids for 6,611 MW and awarded an aggregate amount of 2,871 MW.
Pursuant to Res. No. 155/16 and Res. No. 216/16,
the former Secretariat of Electric Energy authorized CAMMESA to subscribe the wholesale demand contracts with every winning bidder, for
1,915 MW with an average price of US$21.833/MW-month, and for 956 MW with an average price of US$19.907/MW-month, respectively. In addition,
through Resolution No. 387/16, the former Secretariat of Electric Energy authorized CAMMESA to execute additional wholesale demand contracts
for two generation projects (one for 100 MW and the other for 137 MW).
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Through Res. No. 287-E/2017, the former Secretariat
of Electric Energy called for a new thermal power tender for the execution of long-term power purchase agreements. The tender focuses
on combined cycle conversion projects and co-generation project.
PPAs were awarded to different projects, by means
of Res. No. 820/2017 and Res. No. 926/2017.
ENARSA transfers
Decree No. 882/2017 instructed the former Ministry
of Energy and Mining (acting as a shareholder of IEASA, currently named ENARSA), to implement the necessary measures so that ENARSA sells,
assigns or transfers its assets, rights and/or shares (as the case may be) related to Ensenada Barragan, Brigadier Lopez and Manuel Belgrano
II thermal power plants and Compañía Inversora de Transmisión Eléctrica CITELEC S.A.
Pursuant to Decree No. 882/2017, the former Ministry
of Energy and Mining was also instructed to implement the necessary measures and procedures to execute the sale, assignment or transfer
(as the case may be) of (i) the Argentine Government’s shares in Central Puerto S.A. equity and the equity of other energy companies
(Central Dique S.A., Central Térmica Güemes S.A., Centrales Térmicas Patagónicas S.A., TRANSPA and Dioxitek
S.A), (ii) the rights held by the Argentine Government regarding the following power plants, companies and shares: Termoeléctrica
Manuel Belgrano, Termoeléctrica José de San Martín (Central Timbúes), Termoeléctrica Vuelta de Obligado
and Termoeléctrica Guillermo Brown.
The subsequent sales and transfers had to contemplate
public and competitive procedures which had to protect the rights established in the companies’ bylaws and related corporate and
contractual documentation.
The bidding terms and conditions of the bidding
contest to transfer Ensenada Barragan and Brigadier Lopez power plants were approved by means of Res. No. 289/2018 of the former Ministry
of Energy and Mining. We submitted offers for both power plants, on February 27, 2019, and we were notified that we had been awarded Brigadier
Lopez Power Plant, which was effectively transferred on June 14, 2019.
The Brigadier Lopez Plant has a Siemens
dual-fuel Siemens SGT5-4000 F gas turbine installed with a capacity of 281 MW.
Renewable Energy
Renewable Energy Program
In recent years, Argentina has prioritized the
generation of electric power from renewable sources. In such regard, it has not only issued regulations intended to regulate and incorporate
this type of energy into the WEM, but it has also promoted it by granting incentives in the form of tax benefits and preferential or subsidized
tariffs.
To promote renewable energy, Law No. 26,190 was
enacted in December 2006 and approved the National Promotional Regime for the Use of Sources of Renewable Energy destined to Power Generation
(the “Promotional Regime”). The renewable energy sources provided for in this system include wind, solar, geothermal, tidal,
hydraulic (hydroelectric power plants up to 30 MW), biomass, landfill gas, sewage-treatment plant gas and biogas (except for the uses
provided for in Law No. 26,093 on biofuels). The purpose of Law No. 26,190 is to increase the proportion of energy provided by renewable
energy sources to 8% of the national electric power consumption within ten years from its effective date. Law No. 26,190 also established
a system of investments for the construction of new works intended to generate electric power from renewable energy sources, which will
remain in force for a term of ten years. The system set forth by Law No. 26,190 has been excluded from the general remuneration scheme
regulated by Res. No. 95/13 as amended (as described below).
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The beneficiaries of this system are individuals
and legal entities that hold investments and concessions for new renewable energy generation works in Argentina that have been approved
by the enforcement authority. The energy must be intended for the WEM and the project must be related to the rendering of public services.
On September 23, 2015, Law No. 26,190 was amended
by Law No. 27,191. The amendments seek to establish a legal framework to increase investments in renewable energies and foster the diversification
of the electric power generation mix, increasing the participation of renewable sources. More recently, pursuant to Resolution No. 27/2025,
the Ministry of Defense established the Unit for the Cooperation of Renewable Energies (Unidad de Cooperación para la Producción
de Energías Renovables or “UCOPER”, for its acronym in Spanish), which is tasked with coordinating, designing,
planning, and executing renewable energy policies and projects. Its responsibilities encompass the assessment of resources, the implementation
of logistical and information systems, the preparation of semi-annual reports, the development of guidelines and terms of reference, and
the facilitation of cooperation agreements and technical assistance with public and private entities.
Tax Benefits Under Law No. 26,190
The former regime includes the following tax
benefits:
1. Early refund of the VAT on the project’s new depreciable assets or infrastructure works: the VAT as invoiced to the beneficiaries on the purchase, production, manufacture or final import of capital goods or the execution of infrastructure works shall be credited against other taxes by the ARCA as soon as at least three fiscal periods have elapsed, as counted from the fiscal period in which the investments were made, or it shall be recoverable in the term provided upon approving the project, under conditions and with the guarantees set forth in that respect.
2. Accelerated asset depreciation for purposes of income tax: the beneficiaries may apply depreciations on the investments associated with the projects subsequent to their approval and under the terms set forth therein. These depreciations are subject to a differential treatment depending on their timing, within the first, second or third twelve-month period after project approval. This alternative is subject to the condition that the assets are to remain as property of the project holder for at least three years.
3. Non-calculation of the minimum presumed income tax provided by Law No. 25,063 on the assets allocated to the projects initiated under the system created by the renewable energy law: this benefit applies to the three fiscal periods preceding the completion of the relevant project. The assets must be connected to the relevant project and must be acquired by the company after the approval of the project. Pursuant to Law No. 27,260, passed by the Argentine Congress on June 29, 2016, the minimum presumed income tax was eliminated for tax periods beginning as of January 1, 2019. However, this benefit might apply to any tax that would eventually complement or replace the minimum presumed income tax (or in case of restoration of such tax).
Tax benefits under Law No. 27,191
Law No. 26,190, as amended by Law No. 27,191,
together with Decree No. 531/2016 and the regulations of the former Ministry of Mining and Energy, set forth the National Promotional
Regime for the Use of Renewable Sources of Energy (the “Promotional Regime”). The Promotional Regime includes the following
tax benefits:
1. Early refund of VAT and accelerated depreciation of assets for income tax purposes, with beneficiaries being able to apply for both benefits simultaneously, subject to reduced benefits based on the actual commencement date of the project’s execution.
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2. Extension to ten years of the tax loss carry forward term for income tax purposes. Tax loss carry forwards arising from the promoted activity may only be set off against net income arising from the same activity.
3. Exclusion of assets connected to the activity subject to the Promotional Regime from the taxable base related to the minimum presumed income tax until the eighth fiscal year following the project’s commencement (inclusive of the first year). Excluded assets are those connected to the project subject to the Promotional Regime and included in the owner’s net worth after the approval of such project. Pursuant to Law No. 27,260, the minimum presumed income tax was repealed effective as of the fiscal periods beginning on or after January 1, 2019. However, this benefit might apply to any tax that would eventually complement or replace the minimum presumed income tax (or in case of restoration of such tax).
4. A 10% exemption on the tax on dividends or earnings distributed by the companies that own the projects subject to the Promotional Regime, so long as these funds are reinvested in new infrastructure projects within Argentina. This tax was eliminated under the terms of Law No. 27,260. The exemption does not apply to the tax applicable to the net gain derived from dividends and profits distributed by Argentine entities to individuals, undivided estates, and beneficiaries abroad, established by the enactment of Law No. 27,430, as amended. Therefore, dividends distributed to individuals, undivided estates and foreign beneficiaries are currently subject to a 7% withholding tax on the amount of such dividends.
5. Tax certificate applicable to the payment of income tax, VAT, minimum presumed income tax and excise taxes for an amount equal to 20% of the value of components of electromechanical facilities made in Argentina, provided that at least 60% of the components (excluding civil works) are made in Argentina. Where there is insufficient or a lack of production of such electromechanical facilities in Argentina, the minimum percentage of national components required is reduced to 30%. The assignment of the tax certificate is conditioned upon the fact that the taxpayer cannot have liquidated debts due and payable to the ARCA. The tax credit certificate may be transferred to third parties only once.
6. Other benefits, including the possibility of shifting increased costs arising from higher fiscal pressure derived from tax increases or the revocation of applicable exemptions on the price of the renewable energy sold after the execution of said contracts. In the contracts executed by CAMMESA, the generator has the right to request recognition of a new price for the energy supplied when there are increases either in national, federal, provincial or municipal taxes, contributions or charges. For such purposes, CAMMESA must be provided with the information and documentation necessary to assess the adjustment of the value of the energy supplied. Decree No. 531/2016 details the definition and scope of the above-mentioned fiscal increases. The request for recognition of the new price due to fiscal increases, together with proof of the information and documentation, is subject to an automatic expiration period.
8. Exemption from special taxes, fees and royalties of any jurisdiction imposed on the access to and use of renewable sources of energy within participating jurisdictions until December 31, 2025, excluding potential fees payable on the use of the state-owned land where the projects are based.
Those interested in joining the Renewable Energy
Promotion Regime must renounce the benefits provided for in previous regimes under Laws No. 25,019 and 26,360, while projects that have
benefited from such regimes can only access the Renewable Energy Promotion Regime if the works agreed upon under the relevant contracts
have not commenced as of the date of submission of the application.
The Renewable Energy Term Market in Argentina
- Resolution No. 281-E/17
On August 22, 2017, the former Ministry of Energy
and Mining published Resolution No. 281-E/17 (“Resolution No. 281”) for the Renewable Energy Term Market (private PPAs between
generators and Large Users, self-generation, co-generation, traders and distributors). Resolution No. 281 was later modified by means
of Resolutions SE No. 230/2019, No. 551/2021 and No. 14/2022, Resolution No. 370/2022 of the Ministry of Economy and Resolution
SE 360/2023.
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Resolution No. 281 seeks to promote and encourage
a dynamic participation in the term market and to foster the increase of private agreements between the WEM’s agents and participants.
Its aim is to provide a feasible alternative for the purchase of energy to tenders by CAMMESA.
Resolution No. 281 makes it possible for Large
Users to comply with their renewable energy consumption quotas through either (i) the joint purchase system (i.e., through CAMMESA),
(ii) the execution of a private PPA or (iii) the development of a self-generation project or a co-generation project.
As a general principle, PPAs executed in the
term market (outside the joint purchase system) may be freely negotiated between the parties with respect to term, priorities, prices
and other contractual conditions.
Section 7 of Resolution No. 281 provides that,
in the case of curtailment, the following power generation plants will have (i) equal dispatch priority between them and (ii) first dispatch
priority over renewable generation projects operating in the term market without an assigned dispatch priority.
RenovAR (Round 1, Round 1.5 and Round 2):
Bidding Process for Renewable Energy Generation Projects
Resolution No. 136-E/16, issued by the former
Ministry of Energy and Mining and published in the Official Gazette on July 26, 2016, launched the public auction process for submitting
bids for Round 1 of the RenovAR Program. Resolution No. 136-E/16 also approved both the bidding terms and conditions of the above-mentioned
auction and the PPAs with CAMMESA.
Pursuant to Resolution No. 213/16 of the former
Minister of Energy and Mining, the results of the tender were published on October 7, 2016. A total of 29 projects with a total installed
capacity of 1,141.51 MW, located in nine different provinces were awarded:
· 12 wind projects for a total installed capacity of 707 MW, with a weighted average price of US$59.39/MWh, a minimum price of US$49.10/MWh and a maximum price of US$67.20/MWh;
· four solar projects for total installed capacity of approximately 400 MW, with a weighted average price of US$59.75/MWh, a minimum price of US$59.00/MWh and a maximum price of US$60.00/MWh;
· five small hydro projects for total installed capacity of 11.37 MW, all at a price of US$105/MWh;
· six biogas projects with a total installed capacity of approximately 8.64 MW, with a weighted average price of US$154 /MWh, a minimum price of US$118/MWh and a maximum price of US$160/MWh; and
· two biomass projects, for a total installed capacity of 14.5 MW, both at a price of US$110/MWh.
Round 1.5 of the RenovAr Program: Public
Bid Process for New Renewable Energy Generation Units
In October 2016, the former Ministry of Energy
and Mining also issued Resolution No. 252-E/16, calling for national and international bids under round 1.5 of the RenovAr Program to
auction an additional 600 MW of renewable energy (400 MW of wind and 200 MW of solar). On November 11, 2016, CAMMESA began analyzing the
technical aspects of the bids that were filed, which included 47 projects totaling 2,486.4 MW.
Pursuant to Resolution No. 281-E/16 of the Minister
of Energy and Mining, the results of the tender were published on November 25, 2016. A total of 30 projects with a total installed capacity
of 1,281.53 MW, located in 12 different provinces were awarded:
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· ten wind projects for a total installed capacity of 765.35 MW, with a weighted average price of US$53.34/MWh, a minimum price of US$46/MWh and a maximum price of US$59.38/MWh; and
· 20 solar projects for total installed capacity of approximately 516.18 MW, with a weighted average price of US$54.94/MWh, a minimum price of US$48.00/MWh and a maximum price of US$59.20/MWh.
Round 2 of the RenovAr Program: Public
Bid Process for New Renewable Energy Generation Units
Following Rounds 1 and 1.5 of the RenovAR Program,
the former Ministry of Energy and Mining pursuant to Resolution No. 275/17, launched Round 2 of the program on August 17, 2017 and granted
awards in the amount of 2,043 MW of renewable power capacity.
We submitted bids for Round 2 of the RenovAR
Program on October 19, 2017, and, on November 29, 2017, we were awarded a wind energy project called, “La Genoveva I,” which
allowed us to add an additional capacity of 86.6 MW to our portfolio.
Round 2.5 of the RenovAr Program: Public
Bid Process for New Renewable Energy Generation Units
After Round 2.0, the former Ministry of Energy
and Mining issued Resolution No. 473-E/2017 of November 30, 2017, which launched Round 2.5. The companies invited to participate in this
new round were those companies that filed bids in Round 2.0 and were unsuccessful due to a small margin.
As a result of Round 2.5 by means of Resolution
No. 488-E/2017 of the former Ministry of Energy and Mining, issued on December 19, 2017, 22 additional projects (totaling 634.3 MW of
projected power) were awarded.
Round 3.0 of the RenovAr Program: Public
Bid Process for New Renewable Energy Generation Units
Through Resolution No. 100/2018, dated November
14, 2018, the former Secretariat of Energy launched Round 3.0 of the RenovAr program and issued the bidding terms and conditions ruling
such bidding contest.
In this new round, participants can submit bids
with respect to electricity projects of no more than 10 MW of capacity each, regardless of the applicable technology (wind, solar, etc.).
The total capacity to be awarded in this round is 400 MW of renewable energy.
On August 2, 2019, pursuant to Disposition SSERyEE
91/2019 the awarding of the PPAs was decided for a total of 259 MW.
Pursuant to the RenovAr regulatory framework,
we were awarded 3 wind projects: La Castellana I in Round 1, Achiras in Round 1.5, and La Genoveva I in Round 2.0. The wind farm La Castellana
I reached its COD in August 2018, while Achiras and La Genoveva I did so in September 2018 and November 2020, respectively. In 2023 and
2024 we acquired the Guañizuil and Cafayate solar farms, which had existing RenovAr programs (through June 2041 and June 2039,
respectively).
The following table shows the main characteristics
of each of the wind farms:
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La Castellana I Achiras La Genoveva I
Location Province of Buenos Aires Province of Córdoba Province of Buenos Aires
Status In operation In operation In operation
Commercial operation date / Expected commercial operation date August 18, 2018 September 20, 2018 November 21, 2020
Awarded power capacity in the bidding process(1) 99 MW 48 MW 86.60 MW
Current/Expected power capacity(1) 100.80 MW 48 MW 88.2 MW
Regulatory Framework RenovAr 1.0 RenovAr 1.5 RenovAr 2.0
Awarded price per MWh US$61.50 US$59.38 US$40.90
Contract length 20 years, starting from commercial operation 20 years, starting from commercial operation 20 years, starting from commercial operation
Power purchase agreement signing date January 2017 May 2017 July 2018
Number of units 32 wind turbines 15 wind turbines 21 wind turbines
Wind turbine provider Acciona Wndpower—Nordex Acciona Wndpower—Nordex Vestas
__________________
Notes:-
(1) The companies that were awarded with project during the bidding process were authorized pursuant to the conditions of such bidding process to introduce minor changes in the power capacity of the project.
Tariffs and Remuneration Scheme
The
tariffs charged by electric power transmission companies include: (i) a connection charge, (ii) a transmission capacity charge and (iii)
a charge for actually transmitted energy. In addition, transmission companies may receive income derived from the expansion of the system.
Transmission tariffs are passed on to final users through the distributors.
The amounts
that distribution companies charge to end-users include: (i) the price for the purchase of energy in the WEM (the seasonal price as described
above), (ii) transmission costs, (iii) the value-added for distribution (“VAD”), which compensates the distributor, and (iv)
taxes. The VAD is the marginal cost of providing services, including the network development and investment costs, operation maintenance
and commercialization costs, as well as depreciation and a reasonable return on the invested capital. The tariffs determined as set forth
above must enable an efficient distributor to cover its operating costs, finance the renovation and improvement of its facilities, satisfy
increasing demand, comply with established quality standards and obtain a reasonable return, while also enabling such distributor to comply
with certain operating efficiency standards and operate in a manner consistent with the amounts it has invested and the national and international
risks inherent in its operations.
The Current Remuneration Scheme for generators
(Spot Sales)
The remuneration scheme for generators engaged
in spot sales was initially established through Res. No. 31/20 dated February 27, 2020. This resolution introduced a remuneration framework
denominated in Argentine pesos applicable to Authorized Generators operating within the Wholesale Electricity Market. The scheme has been
amended by multiple subsequent resolutions to adjust remuneration values in response to market conditions.
During 2025, the remuneration
scheme was emended by Res. No. 27/25, Res. No. 113/25, Res. No. 143/25, Res. No. 177/2025, Res. No. 227/2025, Res. No. 280/2025, Res.
No. 331/2025, Res. No. 356/2025, Res. No. 381/2025, Res. No. 483/2025, and Res. No. 602/2025. Each resolution provided incremental updates
to remuneration values for power and energy generation not bound by electricity supply contracts, reflecting continuous adaptations by
the SE's agenda to balance fiscal and operational requirements in the electricity sector.
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In addition, Res. No. 59/2023,
issued in February 2023, introduced a specialized price scheme for thermal power plants categorized as "Combined Cycles." Under
this resolution, generating agents not bound by electricity supply contracts were encouraged to enter into a "Power Availability
and Efficiency Improvement Agreement" with CAMMESA to facilitate the investments necessary for machinery maintenance. Generating
agents were required to submit applications to CAMMESA within 90 days following the resolution's publication.
Following the emergency declared by Decree No.
55/2023, as amended, further adjustments culminated in Res. No. 602/2025 in December 2025. This resolution replaced Annexes I through
V of Res. No. 483/2025 and established remuneration values applicable to various types of generation, including thermal, hydroelectric
and renewable sources. The resolution also set forth criteria for financing repayments concerning significant maintenance activities.
In addition, Res. No. 294/2024 established
a “Contingency and Forecast Plan for the Critical Months of the 2024/2026 Period”, which sets forth measures addressing power
generation, transmission, and distribution. With respect to generation, an additional, complementary and exceptional remuneration was
introduced subject to an availability commitment involving generation units not included in contracts within the WEM, or which had not
adhered to Res. No. 59/2023. This resolution is in force until March 2027. Under this regulation, generators commit to power availability
for each unit during designated critical hours on business days in the summer months (December through March) and winter months (June
through August). CEPU adhered to Resolution 294 with the steam turbine (TV) units located in Buenos Aires and Luján de Cuyo, and
the gas turbine (TG) units located in Luján de Cuyo and at the Brigadier López thermal power plant.
New remuneration scheme - Res. No. 400
Until February 2025, the
term market consisted of the MATER, the Energía Plus service and remaining Base Demand contracts.
In February 2025, the SE
initiated a normalization process of the WEM through Res. No. 21/2025 and Res. No. 400/2025. Res. No. 21/2025 restored free contracting
in the term market for new generation capacity installed after January 1, 2025, removing prior regulatory restrictions and establishing
the phase-out of the Energía Plus scheme by February 2026. Res. No. 400/2025 further advanced this process by introducing new rules
aimed at gradually shifting price formation toward market-based mechanisms.
Under this framework, the
term market is playing an increasingly relevant role as a contractual hedging mechanism for distributors and large users. In particular,
thermal generators were authorized to commercialize a portion of their output under bilateral contracts. As a result, CEPU is allowed
to sell up to 20% of the energy generated by its thermal units in the term market to large users, as well as the entirety of its generation
allocated to uncovered seasonal demand, increasing its commercial flexibility.
In addition, in 2025, CEPU
was awarded the acquisition of the Piedra del Águila hydroelectric power plant, one of the main hydroelectric assets in Argentina.
Under the new regulatory framework, as of January 2026, this facility is authorized to commercialize up to 5% of its energy and capacity
in the term market to large users and distributors, further supporting the CEPU’s commercial strategy through bilateral contracting.
Overall, these regulatory
changes reinforce the growing role of the term market within the Argentine electricity sector, increasing the relevance of competitive
contracting mechanisms and providing generators with greater flexibility to actively manage their energy portfolios.
In November and December
2025 CEPU initiated sales from previously referred as spot assets (Central Puerto complex and Central Costanera complex) adding contracted
energy and capacity to its portfolio. CEPU’s client portfolio includes a diversified base of industrial and commercial off-takers.
Representative clients include Cargill, Bunge, Viterra, Renova, Molino Cañuelas, Holcim, Salta Refrescos, Papel Prensa, Laboratorio
Andrómaco, Gador, Petfoods Saladillo, Cafés La Virginia. CEPU also supplies energy to a broad
range of mid-sized industrial clients across sectors such as agribusiness, food processing, construction materials, chemicals and logistics.
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In addition, CEPU provides
energy and capacity to electricity distribution companies, including EDEA, EDELAP, EDEN, EDES, EDESA and EDESE. CEPU continues to actively
pursue the expansion of its client base and the execution of additional agreements with generators, with the objective of further strengthening
its position in the market.
Under the new remuneration scheme, generating
units receive power compensation during Power Remuneration Hours (HRPs) based on each unit’s availability. The price per hour of
Power Made Available (“PPAD”) is 12 US$/MW-month, adjusted by a KP factor of 1.5 during summer and winter and 1.0 for the
remainder of the year. For units operating exclusively with natural gas, the KP factor is set at 1.1 during peaks periods and 0.9 during
off-peak periods. Additionally, units receive US$1,000 per MW-month as a Base Reliability Reserve Service.
Combined cycles may access this remuneration
scheme to the extent they previously request a waiver to the agreement under Res. No. 59/2023. Central Puerto requested such waiver to
CAMMESA on October 31, 2025.
Energy remuneration pursuant to Res. No. 400/2025
partially captures the marginal rent over the variable production cost, calculated as follows:
RMA = (CMgh × FP – CVP) × FRA
RMA (Adapted Marginal Rent): Subject to minimum
values of US$2/MWh for units with a Variable Production Cost (CVP) below US$60/MWh, and US$7/MWh for units with a CVP equal to or exceeding
US$60/MWh.
CMgh: Hourly System Marginal Cost
FP: Loss Factor
CVP: Variable Production Cost declared by the
generating unit
FRA (Adapted Rent Factor): A parameter that limits
the rent captured for thermal generation and for existing units with self-managed fuel supply. The FRA is set at 15% for 2025-2026, 25%
for 2027, and 35% from 2028 onwards. For generators consuming volumes under the “NG Agreement” (volumes committed by CAMMESA
under the Gas Plan), the FRA must be multiplied by an additional “FRC” factor, which is set at 0.8 for the first two years
and 0.5 from 2028 onwards.
Puerto Energia S.A.U
(Resolution 269/2024)
In 2024, through Res. No.
269/2024, Puerto Energía S.A.U. was authorized to participate in the Wholesale Electricity Market (MEM). Sales started with the
November transaction, reaching approximately 5.72 GWh of energy, with 13 contracted supply points.
During the year, Puerto
Energía S.A.U. signed four agreements with major generators in the Wholesale Electricity Market, including YPF Energía Eléctrica,
Pampa Energía, CAPEX, and Parque Solar Villa María de Río Seco, from NEUSS FUND Group. Additionally, the company
signed Energía Plus agreements totaling 3.18 GWh and MATER agreements for 2.54 GWh.
In 2024, through Resolution
ENARGAS 107/2024 dated March 22, 2024, Puerto Energía S.A.U. was authorized to participate as a natural gas marketing company
in Argentina. The current market includes more than 90 marketing companies in a very competitive market. By the end of the year, the
company’s accounts included a firm contract volume of 200 dam3 per day with industries and others marketing companies. In addition,
small volumes of purchase and sale transactions have been carried out on the daily spot market.
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Its main clients are Rontaltex S.A and
Ferroglobe Argentina SRL. (both industrial clients), as well as other natural gas marketing company.
Evolution of Supply and Demand in the Argentine
Energy Sector Structure
Structural Characteristics of the Energy
Sector
The evolution of demand and energy consumption
in Argentina is correlated with the evolution of the GDP, which implies that the higher the economic growth, the higher the energy demand.
For example, the historical compound annual growth rate (CAGR) of energy consumption was of 2.77% annually over the past 30 years, with
an annual average of 2.35% since 2004, although between 2004 and 2024 the economic growth rose to an average of 2.18%annually (including
exports and losses).
The growth of energy consumption during the last
decade is similar to the historical average, since it was not driven by a large increase in consumption of the industrial sector, but
predominantly by that of the residential and commercial sectors, as noted in the consumption parameters of gas, gasoline and especially
electric power.
The elasticity of energy consumption in relation
to the GDP during the last two decades is lower than in earlier decades, so restrictions on energy demand or the need for energy imports,
if domestic supply is insufficient, could increase if the industrial sector expands in the future.
The restrictions on the supply of certain energy
products such as natural gas in the last cycle of high economic growth and the relatively moderate growth in energy demand in broad terms,
are based primarily on problems related to the supply of these energy products and also on a significant growth of the demand of the residential
and commercial segments in a context of weak industrial activity with few new expansions of greater productive capacity for large energy
consumers.
The structure of electric energy consumption
in Argentina is strongly dependent on hydrocarbons.
Year Hydrocarbons Consumption (%)
2019 61.06 %
2020 61.36 %
2021 63.52 %
2022 58.92 %
2023 51.64 %
2024 53.01 %
2025 52.68 %
Source: CAMMESA annual report.
The chart below shows the primary energy sources in Argentina
during 2025:
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__________________
Source: Secretariat
of Energy.
Structure of the Electric Power Supply in
Argentina
The nominal installed capacity in Argentina was
reported by CAMMESA to be 44,177 MW as of December 31, 2025. Availability estimated by CAMMESA for thermal units was approximately 72.48%
on average for 2025 due to the lack of proper fuel supply, difficulties in achieving nominal efficiency and unavailability of several
generating units under maintenance.
Over recent decades, the Argentine Government
(spanning administrations with different ideological orientation) has favored the deployment of thermoelectric generating units. One reason
for this is that these units require smaller capital investments and take less time to deploy compared to other types of generating units.
The increased dependency on hydrocarbons for these new power plants was not considered a disadvantage since the required fuels have always
been produced in Argentina and the production has always been predictable and growing. However, the constant deployment of thermoelectric
generation has increased the demand for fossil fuels, particularly those based on natural gas, and has led to shortages and the imposition
of certain restrictions on the provision to thermal generators of locally produced fuels.
During the 1990s, private sector investors also
concentrated their investments in thermoelectric generation, almost without exception. The economic crisis of 2002 accelerated even more
the tendency to invest in thermoelectric plants, given their lower cost of startup. After the crisis of 2002, investments in the electrical
sector continued mainly with state intervention, expanding the installed capacity based on thermoelectric generation but without meeting
the increasing demand. The financial constraints of the Argentine Government in the last decades, the high amount of capital needed and
the long periods necessary to develop the projects have negatively impacted on the decision of the Argentine Government to invest and
deploy hydroelectric and nuclear power plants. In addition, the recurrent fiscal crises of the recent past have forced the Argentine Government
to delay or cancel major projects that would have increased and diversified Argentina’s generation capacity.
Nominal Power Generation Capacity
There are three main centers of electric power
supply in Argentina:
· Buenos Aires-Greater Buenos Aires-Coastline
· Comahue
· Northeast Argentina
The following chart shows the development of
electric power generation by type of source in Argentina:
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Source: CAMMESA
The following chart shows the installed capacity
for electric power generation by type of source in Argentina:
__________________
Source: CAMMESA.
Renewable Energy Generation in Argentina
Certain regions of Argentina benefit from levels
of wind or sunlight that provide a strong potential for renewable energy generation. The maps below show the mean wind speed at 80 meters
of elevation and the average global horizontal irradiance in Argentina, respectively.
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Average Wind Speeds
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Source: Vaisala
- 3Tier.
Average Global Horizontal Solar Irradiance
(GHI)
__________________
Source: Vaisala
- 3Tier.
The Structure of Electric Power Demand
in Argentina
Electric power demand depends to a significant
extent on economic and political conditions prevailing from time to time in Argentina, as well as seasonal factors. In general, the demand
for electric power varies depending on the performance of the Argentine economy, as businesses and individuals generally consume more
energy and are better able to pay their bills during periods of economic stability or growth.
As a result, electric power demand is affected
by Argentine Governmental actions concerning the economy, including with respect to inflation, interest rates, price controls, foreign
exchange controls, taxes and energy tariffs.
The following chart shows the demand for electric
power in 2025 by customer type:
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_________________
Source: CAMMESA.
The following chart shows the evolution of the
demand for electric power in Argentina from 2006 through 2025:
__________________
Source: CAMMESA.
The following chart shows the power demand in
Argentina from November 2006 through November 2025:
__________________
Source: CAMMESA.
Power
demand drivers in Argentina
Electric power demand
in Argentina exhibits a strong correlation with GDP, although this relationship is asymmetric: during significant GDP contractions, electricity
demand tends to decline by a proportionally smaller amount. Conversely, in periods of low economic growth, electricity demand has historically
grown at rates exceeding GDP growth, as illustrated below. In 2025, total electricity demand increased by approximately 1.0% to 141,249
GWh according to CAMMESA, while GDP expanded by approximately 4.5%.
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Beyond the GDP relationship,
electricity demand in Argentina is significantly influenced by two structural drivers. First, temperature sensitivity: the peak power
demand record of 30,257 MW was set on February 10, 2025, driven in part by temperatures reaching 37.9°C in Greater Buenos Aires. Milder
temperatures in November 2025-averaging 20.6°C compared to 22.4°C in November 2024-contributed to a 3.2% year-over-year decline
in demand for that month.
The residential segment
is the most temperature-sensitive segment, accounting for the largest swings in monthly consumption. Second, electrification and technological
progress: the residential sector has been the primary driver of structural demand growth, propelled by the increasing electrification
of household services. Renewable energy capacity expanded by over 1,000 MW in 2025, with wind capacity reaching 4,496 MW and solar PV
capacity reaching 2,464 MW, reflecting the ongoing transformation of the generation mix. According to CAMMESA’s analysis, the coefficient
of determination (R²) between electricity demand and the industrial production index was 0.91, indicating a strong correlation between
grid activity and broader economic and industrial output.
__________________
Source: CAMMESA,
INDEC.
CAMMESA divides Argentina into regions that have
similar characteristics in terms of demand, socio-economic characteristics and electric subsystems. Such regions are: (i) the City of
Buenos Aires and its suburbs, (ii) the Province of Buenos Aires, (iii) Santa Fe and Northwest Buenos Aires, (iv) the Center, (v) the Northwest,
(vi) Cuyo, (vii) the Northeast, (viii) Comahue and (ix) Patagonia.
Demand is significantly concentrated in the areas of
the City of Buenos Aires, the Province of Buenos Aires, Santa Fe and Northwest Buenos Aires, which comprises approximately 60.88% of the
demand. Changes to the concentration of the demand structure are not substantial over the period of measurement. The chart below shows
electricity demand by region for 2025.
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__________________
Source: CAMMESA.
Seasonality also has a significant impact on
the demand for electric power, with electric power consumption peaks in summer and winter. The impact of seasonal changes in demand is
registered primarily among residential and small commercial customers. The seasonal changes in demand are attributable to the impact of
various climatological factors, including weather and the amount of daylight time, on the usage of lights, heating systems and air conditioners.
The impact of seasonality on industrial demand
for electric power is less pronounced than on the residential and commercial sectors for several reasons. First, different types of industrial
activity by their nature have different seasonal peaks, such that the effect of climate factors on them is more varied. Second, industrial
activity levels tend to be more significantly affected by the economy, and with different intensity levels depending on the industrial
sector.
In 2025, residential demand increased by 1.22%,
while small commercial demand increased by 0.19% compared to the previous year. 2025 was characterized by an increase in the electricity
rate for end users together with a reduction in subsidies for residential demand.
Power and energy consumption records
New records Previous records Variation Variation
Peak of electric power capacity (MW) (%) (MW)
Working day Feb 10, 2025 30,257 Feb 1, 2024 29,653 2.04% 604
Saturday Mar 11, 2023 27,203 Jan 15, 2022 26,719 1.81% 484
Sunday Feb 12, 2023 25,739 Dec 11, 2021 23,724 8.49% 2,015
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Variation Variation
Energy (GWh (%) (GWh)
Working day Feb 1, 2024 597.7 Mar 13, 2023 590.7 1.19% 7.00
Saturday Mar 11, 2023 599.8 Jan 15, 2022 559.0 7.30% 40.80
Sunday Feb 12, 2023 543.6 Jan 16, 2022 478.9 13.51% 64.70
__________________
Source: CAMMESA.
As with natural gas, the strong seasonality of
electric power demand in Argentina—both in terms of energy and capacity—drives investment requirements, as infrastructure
is designed to meet maximum peak winter demand. This results in significant surplus capacity at other times of the year, leading to lower
costs and increased competition during those periods. Maximum electric power demand occurs during afternoon or evening hours in summer.
In winter, peak demand is typically in the evening, driven by the widespread use of electric heaters, which consumers prefer due to their
lower cost and simplicity compared to natural gas heaters.
Not all the generation capacity is available
at times of peak demand. Both in summer and especially in winter, there is an effective generation capacity to meet the demand. The effective
capacity available (which means the capacity available) is significantly lower than the nominal installed capacity.
Energy generation may be influenced by the physical
and economic capacity to provide fuel to thermoelectric generators.
Fuel availability is a factor that contributes
to technical unavailability. The costs and logistics for importing and supplying fuel oil, gas oil, and coal are key to the future availability
of thermal units at specific times of the year.
Thermal generation by type of fuel
In 2025, 96% of the thermal energy in Argentina
was generated with natural gas. The following chart shows thermal energy generation in Argentina by type of fuel source during 2025:
__________________
Source: CAMMESA,
Company analysis.
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Item 4.C Organizational structure
The following diagram illustrates our organizational
structure as of the date of this annual report. Percentages indicate the ownership interest held.
__________________
Source: CAMMESA
and CEPU.
Notes:-
(1) See “Item 4.B. Business overview—Our Subsidiaries”.
(2) See Item 4. Information of the Company—Simplification of Corporate Structure at Central Puerto S.A.”
Item 4.D Property, plants and equipment
Property, Plant and Equipment
Most of our property, plant and equipment is
intended to be used in the generation of electric power and in our forestry business, and 100.00% of them are located in Argentina.
We have no significant assets under capital lease
or lease agreements.
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The following table provides certain information
regarding the operation of our power plants that we owned as of December 31, 2025:
Site Plant Unit Installed Capacity Type Fuel Type (if any)
Puerto Complex 1,747 MW
Puerto Nuevo plant 589 MW
PNUETV07 145 MW Thermal NG / FO
PNUETV08 194 MW Thermal NG / FO
PNUETV09 250 MW Thermal NG / FO
Nuevo Puerto plant 360 MW
NPUETV05 110 MW Thermal NG / FO
NPUETV06 250 MW Thermal NG / FO
Puerto combined cycle plant 798 MW
CEPUCC GE 798 MW Thermal NG / GO
Costanera Complex(1) 1,799 MW
Central Costanera Plant 661 MW
COSTTV01 123 MW Thermal NG / FO
COSTTV02 116 MW Thermal NG / FO
COSTTV03 112 MW Thermal NG / FO
COSTTV07 310 MW Thermal NG / FO
Central Costanera combined cycle plant 851 MW
COSTCC08 264 MW Thermal NG / FO
COSTCC09 264 MW Thermal NG / FO
COSTTV10 323 MW Thermal NG / FO
Buenos Aires combined cycle plant 277 MW
BSASTG01 190 MW Thermal NG/FO
BSASTV01 87 MW Thermal NG/FO
Piedra del Águila 1,440 MW
Piedra del Águila plant 1,440 MW
PAGUHI 1,440 MW Hydroelectric
Luján de Cuyo MW
Luján de Cuyo plant 576 MW
LDCUCC25 290 MW Thermal NG
LDCUTG23 23 MW Thermal NG / GO
LDCUTG24 23 MW Thermal NG /GO
LDCUTV11 60 MW Thermal NG / FO
LDCUTV12 60 MW Thermal NG / FO
LDCUTG22 24 MW Thermal NG / GO
LDCUTG26 47 MW Thermal NG / GO
LDCUTG27 48 MW Thermal NG
LDCUHI 1 MW Hydroelectric
Brigadier Lopez Brigadier Lopez plant BLOPTG01 421 MW Thermal NG / GO
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Site Plant Unit Installed Capacity Type Fuel Type (if any)
San Lorenzo San Lorenzo plant TER6CC11 391 MW Thermal NG / GO
La Genoveva 130 MW
La Genoveva I wind farm GNVEO 88 MW Wind
La Genoveva II wind farm GNV2EO 42 MW Wind
La Castellana (2) 116 MW Wind
La Castellana I wind farm LCASEO 101 MW Wind
La Castellana II wind farm LCA2EO 15 MW Wind
Achiras Achiras wind farm ACHIEO 48 MW Wind
Manque Manque wind farm MANQEO 57 MW Wind
Los Olivos Los Olivos wind farm OLIVEO 23 MW Wind
PS Guañizuil II A(3) Guañizuil II solar farm GZ2AFV 100 MW Solar
PS Cafayate Cafayate solar farm CAFAFV 80 MW Solar
PS San Carlos San Carlos solar farm SCARFV 15 MW Solar
__________________
Notes:-
Reference:
NG: natural gas; FO: fuel oil; GO: gas oil
(1) Costanera complex is owned by Central Costanera S.A. which is 71.94% owned by Proener S.A.U., as of December 31, 2025. As of the date of this annual report, we own a 100% interest in Proener. See “Item 4.B. Business Overview—Our Subsidiaries”.
(2) La Castellana I is owned by CP La Castellana S.A.U., La Castellana II , Manque, Los Olivos, La Genoveva II and the San Carlos solar farm are owned by Puerto Energías Renovables S.A.U. (formerly known as Vientos La Genoveva II S.A.U.) La Genoveva I is owned by Vientos La Genoveva S.A.U. Achiras wind farm is owned by CP Achiras S.A.U. As of December 31, 2025, CP La Castellana S.A.U., Puerto Energías Renovables S.A.U., Vientos La Genoveva S.A.U. and CP Achiras S.A.U. were all wholly owned subsidiaries of Central Puerto S.A.
(3) PS Guañizuil II A solar farm is owned by CP Cordillera Solar S.A.U. which is a fully owned subsidiary of Central Puerto S.A. Cafayate solar farm is 99.99% owned by Central Puerto S.A. and 0.01% by Proener S.A.U.
See “Item
4.B. Business Overview—Our Subsidiaries” and “Item 4. Information of the Company—Recent Developments—Simplification
of Corporate Structure at Central Puerto S.A.”.
We believe that all of our production facilities
are in good operating condition. We believe that we have satisfactory title to our plants and that our facilities are operated and maintained
in accordance with standards generally accepted in the electric power and the forestry industry. As of December 31, 2025, the consolidated
net book value of our property, plant and equipment was Ps. 2,345.65 billion.
The following table lists the value of our property,
plant and equipment as of December 31, 2025:
Main Item As of December 31, 2025
(in thousands of Ps.)
Lands and buildings 456,475,337
Electric power facilities and other equipment 1,420,226,908
Wind turbines 390,698,568
Gas turbines 31,043,207
Construction in progress 22,424,067
Other 24,786,082
Total 2,345,654,169
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For information on our forestry assets, see “Item
4.B. Business Overview—Forestry Assets” and Note 2 to our financial statements.
For information on our plants under construction,
see “Item 5.A. Operating Results—Expansion of Our Generating Capacity”.
For information on environmental issues that
may affect our utilization of assets, see “Item 3.D.—Risk Factors—Risks relating to Our Business—Climate change
and energy transition could affect our business”, and “—Our ability to operate wind and solar farms profitably is highly
dependent on suitable wind or sun and associated weather conditions, climate change and energy transition could affect our business”.