Romania’s government will return the surcharges illegally collected only to the energy producers who challenged in court the relevant provisions, the Ministry of Energy said after a Constitutional Court invalidated some parts of the system of surcharges and compensations enforced in 2022 to keep the end-user prices under control, Economedia.ro reported.

At this moment, the financial impact of the Constitutional Court’s ruling is not clear, but the sum circulated by media (RON 27 billion) is wrong, the ministry said in a response, while admitting that it collected RON 27 billion (EUR 5.5 billion) under the system over the past two years.

The response comes after the Constitutional Court ruled that the surcharge levied on energy production companies under Romania’s mechanism aimed at capping the end-user prices is breaching the principles of fair taxation.

One thing is, however, sure: the government can no longer levy the surcharge during the several months until the scheme is supposed to end on March 31 next year. The government has already accumulated hundreds of millions of euros in unpaid compensations owed to energy suppliers who sold to end-users at regulated prices below the wholesale prices. The incident comes at a time when the executive struggles with keeping the deficit from rising above 8% of GDP.

Energy expert Razvan Nicolescu commented on an extremely pessimistic note, saying that the extra dues owed by the government may push the executive to extreme measures such as relying on IMF financing, according to Economedia.ro. 

The Constitutional Court “admitted the exception of unconstitutionality and found that the provisions of art. 15 and those of Annex no. 6 of OUG 27/2022 regarding the measures applicable to final customers in the electricity and natural gas market during the period April 1, 2022 - March 31, 2023, are unconstitutional.”

Several companies in the sector, especially those in the renewable industry, challenged the surcharge. 

Under the mechanism, the revenues generated by the surcharge were used to cover the difference between the price paid by the energy suppliers on the wholesale market and the regulated end-user prices. 

iulian@romania-insider.com

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