Radio România Internațional

Tag: energy price

  • Compensations for energy?

    Compensations for energy?

    Romania will ask the EU for compensation for the significant energy price differences between the west and the east of the continent, claims the energy minister, Sebastian Burduja. He explained that these differences are allegedly caused by the lower hydropower production in the country due to the drought, and by interconnection problems, which did not allow the export of cheaper energy from the west to the east. Moreover, Romania supports the Republic of Moldova and Ukraine energetically, and all these create pressure on prices in the country. Sebastian Burduja added that the request would be submitted to the Council of Ministers, at the European level, and said that he hoped that Romania would be compensated for these price differences. He emphasized that he strongly supported the expansion of the single market.

     

    At present, Romania pays a price of almost 150 euros/MWh, well above the European average of almost 102 euros/MWh. The price is felt all the more as the country faces significant obstacles related to diversifying the energy mix and improving energy efficiency, according to the European Commission’s latest report on the energy union. The situation is also valid at the European level, even if the document shows that significant progress has been made regarding energy from renewable sources. Romania’s energy mix remains heavily dependent on fossil fuels, which account for 71% of the total energy consumption, slightly above the EU average of 69%. The country’s electricity mix is ​​dominated by renewables (42.4%), followed by fossil fuels (37.6%) and nuclear power (19.9%).

     

    To ensure its energy security, Romania operates six gas storage facilities with a total capacity of 3.1 billion cubic meters, the equivalent of 31% of the annual gas consumption. By mid-August, these storage facilities were already filled, ensuring the country for the coming winter. Romania is committed to expanding its nuclear capacity to meet the EU’s climate targets and to strengthen its energy security. Two new reactors (CANDU), each with a capacity of about 700 MWe, are to be built to complement the existing nuclear facilities. Despite the progress reported, Romania is facing integration and compliance challenges. The country’s wholesale electricity and gas markets are heavily influenced by government interventions that go beyond the EU’s emergency framework.

     

    At the same time, smart meters, a critical tool for increasing market flexibility, are installed in only 23% of Romanian households, which points to the need for improvements in terms of ensuring energy efficiency. According to the report, energy poverty remains a major concern in Romania. In 2023, 13.6% of the people had difficulty paying their utility bills and 12.5% ​​were unable to heat their homes adequately in winter, which is indicative of the need for accelerated building renovation and targeted social measures. (LS)

  • October 2, 2022 UPDATE

    October 2, 2022 UPDATE

    Protests – Several thousand people gathered, on Sunday, in the University Square in the center of Bucharest and walked towards the Government headquarters, the line of protesters being led by the leader of the Alliance for the Union of Romanians AUR, George Simion, and MPs from this political party. The grievances of the protesters, who held the Romanian tricolors and placards and chanted anti-government slogans, are related, among other things, to the increase in electricity and natural gas prices. Law enforcement forces have mobilized in large numbers to prevent possible incidents.



    Statement — Romania’s President, Klaus Iohannis, along with seven other presidents of several NATO member states from Central and Eastern Europe, namely the presidents of the Czech Republic, Estonia, Lithuania, North Macedonia, Montenegro, Poland and Slovakia, signed a joint statement reiterating their support for the sovereignty and territorial integrity of Ukraine. “We firmly support the decision of the NATO Summit in Bucharest of 2008 regarding the future accession of Ukraine,” Klaus Iohannis said in a post on a social network. We remind you that on September 30, the Ukrainian president, Volodymyr Zelensky, signed Ukraines request for an accelerated accession to NATO. The Secretary General of the Alliance, Jens Stoltenberg, stated that Ukraine has the right to apply for membership, but emphasized that, at the moment, the priority is providing aid to Kyiv. Support for Ukraines accession to NATO has already been expressed by the Baltic States and Canada.



    Ukraine – In Moscow, the State Duma announced that on Monday it would ratify the annexation treaties signed with the Ukrainian region of Donetsk, Luhansk, Kherson and Zaporizhzhia. These annexations come after seven months of Russian offensive in Ukraine and emergency “referendums” held in the occupied regions, which were denounced as “shams” by Kyiv and its allies. The news agencies write that the Russian authorities are following exactly the same steps they took when Russia illegally annexed the Ukrainian peninsula of Crimea in 2014. On Sunday, Pope Francis said that it was completely absurd that the world was currently facing a nuclear threat. The Sovereign Pontiff deeply deplored actions contrary to the principle of international law, referring to the annexation of Ukrainian territories by Moscow. The statement follows that of the Kremlin leader, namely that Russia could use nuclear weapons to defend what it considers to be its own territory, the BBC points out. In the following days, the Director General of the IAEA, Rafael Mariano Grossi, will travel to Kyiv and Moscow, the visit being part of ongoing efforts for “the implementation as soon as possible of a nuclear safety and security zone around the Zaporizhzhia nuclear power plant”.



    Energy – In Romania, the Law for the approval of the Emergency Ordinance that regulates prices on the energy market will be debated in the following days by the specialized committees of the Chamber of Deputies, which is the decision-making body in this case. The document drafted by the Government underwent important changes in the Senate, before receiving the vote of the plenum. Several fields of activity and categories of consumers have been introduced among those that will benefit from the capped energy price: public transportation, churches and medicine manufacturers and traders, as well as patients who use medical devices at home. Another significant change is related to the elimination of charging electricity consumption based on the monthly average of last year.



    Football – The International Federation of Association Football (FIFA) declared that the incident that took place on Saturday at the stadium in Malang, in East Java, Indonesia, is an unimaginable disaster and represents a black day for the entire world of sports. At least 125 people lost their lives in a stampede at the stadium after the match between a local team and a visiting team. The angry fans of the local team, which lost the match, invaded the pitch, and the police intervened with tear gas grenades to disperse the violent fans. Running for the exits to escape the tear gas, fans trampled on and crushed one another.

  • September 14, 2022 UPDATE

    September 14, 2022 UPDATE

    Debates – The new scheme for capping and compensating the price of energy on Wednesday reached the parliamentary committees in Bucharest for debates. The senators from the economic and energy commissions are debating the document recently adopted by the government, which includes the new scheme for compensating and capping the energy price, which applies from September 1. According to the emergency ordinance, the monthly consumption level up to which the price will be capped was reduced to 255 KWh, in the case of electricity. The intention of the government is for people to try to save electricity in the coming period. In the case of natural gas, the ordinance does not make any changes for domestic consumers. The interim speaker of the Senate, Alina Gorghiu, has declared that the ordinance will be modified in the commissions, if anything was omitted, but the changes will be made with the agreement of the governing coalition. The provisions in the emergency ordinance have triggered criticism from the opposition and the business environment.



    Energy — The EU will propose measures to cap the income of low-cost electricity producers and will force companies that sell fossil fuels to share the profits they make following the increase in energy prices. The announcement was made on Wednesday by the president of the European Commission, Ursula von der Leyen, during her speech on the state of the EU held in the plenary session of the European Parliament gathered in Strasbourg. She also said that the EU bloc was also discussing capping energy prices and was working on establishing a more representative gas reference price than that at the TTF hub in Amsterdam. In the spring, at the TTF hub in Amsterdam, the gas pricing hub for the European gas market, the pricing reached the record level of almost 335 Euros for one MWh. Also, the European Commission will propose that member countries should reduce their net monthly electricity consumption by at least 10% and by 5% during peak hours, until March 31, 2023. Instead, the EC document does not include a ceiling for the price of natural gas, an idea that caused divisions among the member countries. Ursula von der Leyen has warned that a difficult period will follow for companies and households in Europe, evoking the economic consequences of the war in Ukraine.



    London – Five days after the death in Scotland, on September 8, of Queen Elizabeth II of Great Britain, the Queen’s coffin arrived at Buckingham Palace in London, last night, to the applause of the crowd, and it was greeted by the new King Charles III. After being on public display for the first time, for 24 hours, in Edinburgh, the royal coffin was flown to the British Capital by a Royal Air Force plane and deposited overnight at Buckingham Palace before being moved, on Wednesday, to Westminster Hall, the building of the British Parliament. From this evening, people will have access to the Parliament building, to pass by the Queen’s coffin. People started queuing as of Tuesday. Hundreds of thousands of people, spread over kilometers and regardless of the weather, are expected to queue for hours to bid their final farewell to the queen. Queen Elizabeth IIs funeral will take place on September 19, at Westminster Abbey. Romania will be represented by President Klaus Iohannis. Her Majesty Margareta, the Custodian of the Crown of Romania, and Prince Consort Radu will also attend the funeral.



    Software — The Romanian government will force all central and local public authorities to give up Russian anti-virus solutions or applications that could be under Moscows control. A draft law in this sense was on the agenda of the government’s meeting on Wednesday, in the context in which other European states, such as Germany and Italy, have already made such decisions. Kaspersky company, which produces one of the best known antivirus solutions, will be directly affected by this measure, because all its software will have to be uninstalled from public computer systems in the country. Any antivirus program creates backdoors on computers and could be used for espionage. The bill’s substantiation note shows that many public institutions and local administration authorities in Romania, including Bucharest City Hall, purchase and use Russian antivirus programs, due to their low prices.



    Tennis — The Romanian tennis player Ana Bogdan (65 WTA) qualified, on Wednesday, to the quarter finals of the WTA 250 tournament in Portoroz, Slovenia, after defeating the Slovenian Tamara Zidansek, 6-1, 6-7, 6-1. The Romanian player will fight for a place in the quarter finals with the Spanish Cristina Bucsa (110 WTA), or the Brazilian Beatriz Haddad Maia (18 WTA). The Portoroz tournament, on an outdoor hard court, has prizes up for grabs worth over 200 thousand Euros. (LS)

  • Again, about offsetting energy prices

    Again, about offsetting energy prices

    The situation in the Romanian energy sector is serious and does not seem to improve in the absence of a firm political intervention. Overlapping the full liberalization of the energy market in 2021, the spikes in electricity and gas prices make victims. On the one hand, among household consumers, especially the vulnerable, who, from one month to the next, receive huge energy bills. On the other hand, companies are also facing problems which, for the same reason, find themselves in a situation to restrict their activity and, consequently, to make a lot of redundancies. One of the most resounding cases, these days, is that of the ALRO Aluminum Plant in Slatina (south), one of the largest in Europe, which has already started closing an electrolysis hall that has been operating for over half a century. The Energy Ministry says that the control over the actors on the energy market is held by the Authority for Energy Regulation (ANRE), an autonomous, independent body, and the National Authority for Consumer Protection.



    The governing coalition made up of the PNL-PSD-UDMR, decided through an emergency decree, subsequently voted in Parliament, to cap energy prices between November 1, 2021 – March 31, 2022, and to provide compensations to the population.



    However, not all market players have complied with the law, according to the energy minister, Virgil Popescu: “Indeed, there are suppliers who have not capped the prices and sent uncompensated bills. Only one large supplier was prepared, so that, by December 15, it issued correct invoices, as stipulated by the law.”



    Consequently, those who have received non-compliant bills do not have to pay them, and the suppliers are obliged to resend correct bills, otherwise, they risk having their operating license lifted. Moreover, the PM Nicolae Ciucă announced further measures to support the population: “As of April 1, household consumers with a monthly consumption of up to 300 kWh will benefit from a new protection scheme, which will include a VAT reduced to 5%, as well as the compensation of the green certificate and of the cogeneration bonus for consumption. We will also draft a natural gas support scheme.”



    According to the prime minister, support measures for SMEs are also being considered, provided that they don’t make redundancies. The Social Democrats welcomed the measures to protect the population against energy price hikes but say that more is needed. Thus, they suggest reducing the VAT not only for energy, but also for natural gas, and not from April 1, but from February 1.



    Almost all products and services have become more expensive in Romania due to the increase in electricity and gas prices, inflation being a matter of concern both for the population and the central bank. For the first part of this year, the inflation level of 7-8% could be exceeded. (LS)