ROMANIA: Romania registers, on the spot market, electricity prices above the average of European countries, with no negative impact on bills – Burduja

These days, Romania records electricity prices above the average of European countries, on the spot market, but these do not have a negative impact on bills, in the context where prices are capped until March 31, 2025, wrote, on Wednesday, the Minister of Energy, Sebastian Burduja , on his Facebook page.

“These days, Romania records electricity prices above the average of European countries. It is important to specify that these prices are on the spot markets, where the volatility is caused by several factors, some internal, some external. (…) Likewise important, in order to understand how short-term markets work, is to remember what happened on April 29, for example, when Romania had the lowest electricity price in the region and the third lowest in the European Union. Or on March 20, when the price in our country was 40% lower than the prices in Poland, these are just two examples. And perhaps the most important thing is that the price volatility during this period has no negative impact in We keep prices under control, through the capping mechanism, until March 31, 2025. We received confirmation from Eurostat, in the last report, that the price paid by the population in Romania is the fifth lowest in the EU. And from our analyses, based on the information received from the main suppliers, the invoice prices in recent months are also 15% lower than the maximum ceiling”, explains the minister in the post on the social network.

According to him, among the factors that have an impact on the prices on the spot markets are the low production of wind energy in Romania and neighboring countries, which generated price differences on the PZU (Market for the Next Day) between our country and the Western countries, the interconnection Austria-Hungary which is used to the maximum, according to the data on entso-e, and too little cheap energy from the west reaches us, most of it remaining in Hungary.

Also, in Romania, the planned revision took place at Nuclearelectrica, and Bulgaria had a nuclear shutdown that was extended by a month compared to the planned period.

Sebastian Burdjua reminds that, in May, the Hungarian energy market decoupled from the South-East European market through interruptions and reductions of the net transfer capacity from Hungary. At the same time, another factor is the unavailability of a key 400 kV transmission line, responsible for the transport of flows from the west to the east of Hungary, as well as from the west to the south of Europe, caused network congestion in the countries of south-east Europe.

“During this period, we have very high temperatures in the region vs the normal temperatures of the period. For example, this week we are daily 7 degrees Celsius above the multi-annual average vs the multi-annual average for this period; being very hot, we have no production from the wind, energy consumption is increased, thus we record high prices on the PZU during the hours when there is no solar production (especially in the evening peak). The prices in the evening peak increase the average daily price; annual at the entrance to the country and is expected to decrease by about 15% in the next week; in general, the hydro production is much below that of last year, because we have a dry summer; the degree of filling in the hydropower lakes is above 80%, thus we are ready to deal with any situations that may arise in the coming months”, explains Sebastian Burduja.

According to the minister, to all this is added the accidental decommissioning of U10 CNE Kozlodui 1000 MW, the shutdown of two nuclear-electric units in Slovakia, each of 500 MW, in total 1,000 MW, Ukraine’s permanent import from Europe, for all time intervals, average of approximately 1,500 MW, and at the evening peak of approximately 1,700 MW, and the planned shutdown of U1 CNE Cernavodă 700 MW, which was put back into operation on June 29, 2024.

“These events prove to us once again the importance of connecting Romania to the European market, as well as the need for accelerated investments in the production of renewable energy and in the band in our country, in storage and in increasing the interconnection capacity between Romania and neighboring countries”, he pointed out the minister.

He reiterated that in 12 months investments of 13.6 billion euros were attracted – non-refundable funds, to which is added the contribution of the beneficiaries (even more, according to estimates), but he emphasized that in energy investments last, they are not made by one day at another.

“The construction of nuclear reactors and SMRs requires years, as well as pumped storage power plants, efficient gas power plants, or the retrofitting of large hydropower plants. But all these projects, along with investments in distribution, transport and green energy are put now in a straight line and we won’t give up until we take them to the end”, stated Sebastian Burduja.

He mentioned that on Wednesday there is a meeting at the ministry with representatives of the National Energy Regulatory Authority, Transelectrica, OPCOM (Electricity and Natural Gas Market Operator) and the associations of energy producers, distributors and suppliers to put on mass solutions and measures to keep a stable and balanced market.