Controversy grows over Mendoza Los Nihuiles concession

In late July 2026, the Mendoza provincial government formally assumed control of the Los Nihuiles hydroelectric complex on the Atuel River, ending a decades-old concession held by Hidroeléctrica Los Nihuiles S.A. (HINISA). Governor Alfredo Cornejo formalized the takeover, appointing state-owned Hidroelectricidad Mendocina S.A. (HEMSA) to manage the facility while a public national-and-international tender is conducted for a new 30-year operating licence. The tender requires the future operator to rehabilitate units Nihuil II and III, which have been out of service since a severe flood in January 2025, and to modernize the plant.

Legislative opposition has intensified the transition. Members of the Justicialist Party in the Mendoza legislature and the San Rafael local legislature demanded a briefing from Energy and Environment Minister Jimena Latorre. Lawmakers alleged the process lacked sufficient oversight, potentially violating Provincial Law 9.630 by failing to pursue an integrated concession with the neighboring Diamante complex, and expressed concerns regarding water, energy, and royalty revenues.

Further controversy has emerged regarding interim operations. While the province contracted the Consorcio de Empresas Mendocinas para Potrerillos (CEMPPSA) to ensure continuity, political opponents have raised concerns about potential favoritism and links to national government interests. Additionally, investigations are examining whether a company linked to Grupo Neuss received early access to the facilities for maintenance. The management of a multi-million dollar insurance policy related to the 2025 flood damage is also expected to influence the final concession terms.