Susbielles Warns of Biofuel Reform Impact on Regional Jobs

Bahía Blanca Mayor Federico Susbielles met with regional biofuel industry representatives on Wednesday to voice concerns over a proposed legislative reform that could threaten local jobs and investments.

The discussion centered on a modification to Law 27.640 currently pending in the Chamber of Deputies, which industry members fear favors large integrated companies at the expense of small and medium-sized enterprises (SMEs).

Legislative Standoff in the Chamber of Deputies

The reform project, which already received partial approval in the Senate on September 17, has stalled in the lower house due to disagreements regarding the regulation of SME participation.

A scheduled vote on the bill’s committee report was postponed on October 28 following objections from UCR and PRO members regarding the chapter dedicated to smaller producers. As of November 14, 2026, the reform appears paralyzed, though dialogue between opposition members and proponents leaves open the possibility of approval.

While the government insists there is no room for further changes to the text, deputies are under pressure to resolve the dispute. “Bahía Blanca defends its industries and its workers. A law that orders the market is necessary, but it cannot be done at the expense of the interior companies that invested, generate quality employment, and bet on the energy transition,” said Susbielles.

Market Share and Economic Impact

The proposed legislation seeks to increase the mandatory biodiesel blend in diesel from 7.5% to 10% within the first year of enactment. However, the bill introduces a sliding scale that reduces the market share reserved for non-integrated SMEs from 6.5% after the law’s passage to 4% by 2031.

Industry representatives note that in the electronic market created by the law, plants in locations like Daireaux, General Pico, Nogoyá, or San Luis must absorb significant freight costs to transport oil, unlike port-based integrated companies.

Juan Ignacio Bojanich of Grupo Bahía Energía, who participated in the meeting with the Mayor, highlighted the industry’s vulnerability. “We are not against modernizing the regime. We ask that the law recognize the SMEs that built this industry in the interior and guarantee them conditions to continue producing,” said Bojanich.

The sector currently encompasses 25 companies across five provinces, supporting approximately 1,500 direct jobs and 8,000 indirect roles, often serving as the primary industrial employer in their respective cities. Historical data shows market volatility: domestic biodiesel sales reached 1,136,729 tons in 2019, falling to 499,456 tons in 2020. According to the Secretariat of Energy, biodiesel sales to the internal market reached 85,542 tons in June 2026.

Biofuels tax exemptions impact revenue and political parties propose changes

Beyond the industrial impact, the Congressional Budget Office estimated a negative revenue impact of $245,952 million, as biofuels are exempt from the Liquid Fuels Tax. The PRO, the MID, and the UCR are advocating for a version of the bill that would increase the biodiesel blend to 11% and extend the quota protection for non-integrated firms from 2036 to 2038.

“No van a tener los votos para aprobarla sin cambios, imaginate si se para todo por esto,” said a representative from one of the allied blocs.

Future Prospects for the Regulatory Framework

Municipal officials, including Secretary of Government Vanesa Arias, said that the city will support efforts to lobby provincial legislators to protect regional plants. Should the Chamber of Deputies approve any changes to the current proposal, the bill must return to the Senate for further review.

Why the legislative process is stalled and how it affects SMEs

Why is the legislative process currently stalled?

Disagreements persist regarding the market participation of SMEs versus large integrated companies. While bioethanol producers have reached a consensus, biodiesel producers remain divided, with non-integrated firms warning that the current bill would allow large firms to co-opt the market.

How would the proposed law change the market for SMEs?

The bill would gradually reduce the market participation reserved for non-integrated SMEs, dropping from 6.5% after the law’s enactment to 4% by 2031. Industry representatives warn this could lead to the loss of competitiveness against large, integrated oil companies.

What is the current stance of the national government?

The government has maintained that there is no room to introduce further changes to the text of the bill. If the Chamber of Deputies introduces modifications, the project is required to return to the Senate for a new vote.