Romania will keep the electricity and natural gas price capping scheme for another year, until the end of March 2025, under an emergency ordinance passed on March 28. 

Some parameters of the scheme – but not the end-user prices – were adjusted to better reflect the lower wholesale market prices. Thus, the capped price for electricity was cut from RON 450 (EUR 90) per MWh, and the capped price for natural gas was reduced from RON 150 (EUR 30) to RON 120 (EUR 24) per MWh. 

The electricity and gas suppliers can not charge prices above the capped ones – as the supplementary revenues generated by higher prices are levied a 100% tax. 

Analysts objected to the still high capped electricity price being above the current market prices. Minister of energy Sebastian Burduja said that the calculations were made by the energy market regulator ANRE but could be subject to further adjustments if needed, Hotnews.ro reported.

In principle, higher capped energy prices encourage higher market prices and, thus, higher profits for energy companies. Part of the profits are poured into the Energy Transition Fund to compensate for the losses incurred by energy suppliers.

Separately, energy suppliers that incur losses because of high market prices and regulated (capped) end-user prices are compensated by the Energy Transition Fund, a government fund financed from windfall taxes charged to electricity and natural gas producers.

The energy suppliers have complained about the late payments operated by the government and objected to some unclear wording in the emergency ordinance that could be interpreted as partial compensation for their losses in case the Energy Transition Fund is insufficient for full compensation.

iulian@romania-insider.com

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