Tangled energy

The heatwave during this month showed the limits of the national energy system, limits that the Government seeks to solve with firefighting measures, which energy experts claim are only valid in the short term and do not solve the systemic problems that date back over 30 years. According to the Government, in the next period it is necessary to increase the production of energy in the band, regardless of the source, to identify a standard format for the transmission/communication of electricity measurement data between distributors and suppliers in order to have a clearer picture of the consumption needs and production and to reduce imbalances, protecting the end consumer from market fluctuations, reducing the intervention time in case of breakdowns and accelerating energy investments with a focus on production, distribution and storage.

However, until the above measures are implemented, the national energy system seems to be suffocating during the summer season, with the recent heat wave putting, due to the increase in consumption, under great pressure both the power generation capacities and the distribution networks and transport. On top of all this was added a daily production of only 1000 Megawatt hours in the wind sector (compared to 2000-3000 MWh during the spring), which explained the constant daily difference of almost 1000 MWh between consumption and energy production, to the detriment of the latter, a fact that led to energy imports, especially during the evening, at prices that reached the spot market even at almost 865 euros MW, as much as it was on July 17, 2024. At this state of in fact, we must also add the situation in the balancing market, where energy suppliers had to pay prices of 16,000 lei or 15,000 lei per MW on some days, prices that they cannot transfer to the final consumers' bills due to the ceiling system- compensation and which means an important loss for the respective companies, a loss that will have a negative impact on their investment plan.

The above situation probably led Prime Minister Marcel Ciolacu to declare yesterday, during the fifth edition of the Business Forum organized on the occasion of the meeting of the Partnership for Transatlantic Cooperation in Energy and Climate (P-TECC): "Our energy systems they must be able to supply energy, at any time and in conditions of internal or external stress, to all consumers and anywhere. Reducing energy costs for all consumers, individual and industrial, is a problem that must be tackled head-on. And we, like the whole of Europe, risk losing our competitive advantage due to high energy prices. We must reverse this trend as soon as possible! Modernization of power generation capacities and transmission lines is urgent. They must be able to stabilize the energy system, allowing the free circulation of energy, in a single market - but a functional one".

The Head of Government also mentioned the need for the faster implementation of the SMR project from Doiceşti and the realization of units 3 and 4 from Cernavodă, in order to increase the production of nuclear energy, which is an energy produced in the strip and which can ensure the consumption needs during the summer period without any more situations like that of this month.

Regarding Prime Minister Ciolacu's statements, deputy Cristina Prună (USR), vice-president of the Commission for Industries and Services in the Chamber of Deputies stated: "The reality on the energy market is extremely hard for Romania. The price of a MWh is day by day among the highest, if not the highest, in Europe. For example, today in Romania the price is 140 euros/MWh (ed. - after two days ago it was 229 euros/MWh), while in Germany it is almost twice as low, 79.51 euros /MWh, and in France almost 5 times lower, 53.88 euros/MWh. I am not talking about the Nordic countries where the price of electricity is 20-40 euros/MWh. Under these conditions, what competitiveness of the Romanian industry should we talk about? We are already on survival, not on growth and development. In recent years only prosumers have achieved new energy production capacities, nothing else. The state is zero barred on new power generation units coming on stream and blocking private investment through red tape and a market it has made a mockery of. The state is always taken by surprise by natural things such as the need for investment in transport and distribution networks and storage capacities".

Under these conditions, the National Energy Strategy, a project whose public debate has ended, and the attraction of in the last year of 13.6 billion euros from European funds in the national energy system for investments whose fruits should be seen only next year, does not represent any hope for domestic and industrial consumers who still have to go through at least a period hot until the end of the summer season, if we take into account that we are only halfway through it. In fact, consumers did not even take into account the exhortation of the Minister of Energy, Sebastian Burduja, to reduce consumption during the evening, by not using the washing machine or setting the operation of the air conditioner to a temperature between 24 and 26 degrees Celsius.

Some of the consumers, as well as some of the parliamentarians, were on the side of Prime Minister Marcel Ciolacu, who blamed the current situation on the former Minister of Energy, Virgil Popescu, who ordered the closure of some electricity production capacities in the band and did not require the realization of storage capacities in the projects regarding energy production capacities from green, renewable sources.

Faced with these accusations, the current European deputy Virgil Popescu, former Minister of Energy in the governments of Orban, Cîţu and Ciuca, said that he attracted 740 million euros for renewable energy, production and energy storage capacities in Romania, an amount secured from funds from PNRR.

Virgil Popescu stated: "There is no risk of blackout, and whoever supports this is only interested in creating panic, creating the conditions to keep prices high and speculate on the energy market. Maybe it wouldn't hurt if someone started investigating, with speed, the speculations in the market during this period! Until then, let's turn on the air conditioning (with or without intermittents), calm down and take things one step at a time. The expansion of energy storage capacities was one of the priorities of my mandate as Minister of Energy. In the component dedicated to energy, from the PNRR, we have foreseen from the very beginning funds dedicated to new energy storage capacities, as well as to the production/assembly and recycling of batteries, with a budget of 280 million euros. In the call for projects for the state aid scheme with the objective of supporting investments for the installation of new electricity production capacities from renewable wind and solar energy sources, worth 460 million euros, we also encouraged the installation of storage, giving applicants additional points in the assessment stage. The total capacity of renewable energy projects, submitted and eligible, is 1.8 GW, i.e. higher than the future reactors 3 and 4 at Cernavodă, and for the storage ones it is 1.8 GWh, i.e. almost double compared to the future Tarniţa - Lăpuşeşti project".

He noted that the only problem is with the Environmental Fund Administration, as funding programs for private prosumers must be amended to include storage capacity.

As can be seen, the Government says that investments in energy have not been made as they should be, Minister Sebastian Burduja has even talked about the loss in the last 30 years of 50% of production capacities in the strip, without new ones being put in place energy capacities, and requested the temporary restart of some coal groups from the Oltenia Energy Complex, while the former minister Virgil Popescu claims that he allocated money for what was necessary, and the political opposition claims that things are not moving.

During this time, consumers experience power outages and power fluctuations, hospitals remain without power for hours, and energy suppliers and distributors experience losses that they do not know when or how they will recover to continue operating. activity in optimal conditions. For a week, the National Energy Regulatory Authority has been showing signs that its officials are still in the offices and have not gone to sea, and has put into public debate two drafts of order by which it establishes the rate of return on investments in the energy field, but also a calculation method for prices in the balancing market so that prices of 16,000 lei per MWh are no longer reached.