The suppliers expect the increase in the settlement terms of the state regarding the compensation of energy facts

The delays regarding the payment by the state of compensation for energy facts could increase significantly after the Government's approval of the draft normative act that will amend GEO 27/2022 through which the capping-compensation mechanism was introduced, said Laurenţiu Urluescu. , the president of the Romanian Energy Suppliers Association (AFEER), yesterday, during the eighth edition of the association's annual conference, an event that this year was held under the title "Preparations for a competitive energy market".

Laurenţiu Urluescu declared: "In the draft emergency ordinance, the wording appears that we are not the least afraid of: "within the limits of available funds". It's stressful for us because settlement delays are already high, and this doesn't show that settlement delays are going to increase. In this context, we express our concern regarding the uncertainty of the settlement of the state budget of the expenses made by the suppliers to support the capping/compensation support scheme, respectively a possible limitation of the settlement, as the Energy Transition Fund proved to be. clearly insufficient".

AFEER representatives show that companies in the energy system contributed to the state budget much more than they received, the collected sums of the companies in this field exceeding 45 billion lei in 2022 and tens of billions of lei in 2023, for the care financial statements. are being completed.

Laurenţiu Urluescu stated: "In such cases, according to ANRE, related to consumption until November 2023, verified and submitted for settlement, they foresee a total amount of 23.3 billion lei. According to the budget execution for the years 2022 and 2023, published on the website of the Ministry of Finance, the total amount settled for the deeds of domestic and non-domestic customers amounted to 21.51 billion lei. Which means that the state owes about 2-2.5 billion lei to suppliers, just for facts issued until November 2023, verified and accepted by ANRE. Next come the months with the highest consumption, the winter months, which will most likely increase the amounts owed by the state to electricity and natural gas suppliers".

• The Energy Transition Fund, at the bottom of the bag

The AFEER president also said that there are still invoices issued in May 2023 to take care of the status has not paid to the energy companies the difference between the actual price and the capped/compensated one.

The representatives of the energy distribution companies also indicated that the Fund for the Energy Transition - the budgetary source from which the state makes payments for energy bills - is running out, under the conditions that it will be necessary to continue the settlement for the ceilings of 0.68 and 0, 8 lei/kWh, are below market energy prices, even if the latter are decreasing. That fund is fueled by the overtaxation of producers, but the drop in market prices has also attracted a decrease in the revenues collected by the state from that overtaxation.

Laurenţiu Urluescu said: "The fund is not really supplied anymore, because the producers sell at 450 lei/MWh, the traders don't really bring anything because at 98% everything is taxed and frozen, no more transactions are made. We have a fundamental problem with the Fund, because it no longer has inputs, it only has outputs".

Regarding the amendment of GEO 27/2022, Istvan-Lorant Antal, the president of the Senatorial Commission for Energy, Energy Infrastructure and Mineral Resources, told the conference participants that, once the new emergency ordinance reaches the Parliament, within the legislative process and the senators . the deputies will modify all the provisions that would make it difficult for energy companies to carry out their activities, as they did during the pandemic, but also after the start of the war in Ukraine.

Lorant Antal stated: "I know that when the Government came up with the ceiling on electricity and natural gas prices, there were also many voices that insisted on maintaining the free market in energy. From our point of view at the time the cap-compensation was the best measure we intervened with, but now we have to start getting out of this cap. I know that ANRE proposes a transition year until the return to the free market".

Adrian Vintilă, adviser to the Minister of Energy, stated that the draft GEO regarding the amendment of the capping-compensation legislation is in public transparency until Friday, including, on the Minister's website, and that the public debate will not be extended because the Government wants the new normative act to take effect starting from April 1, 2024, especially since it provides that the Centralized Electricity Procurement Mechanism (MACEE) will be voluntary between April 1- December 31, 2024. He specified that the future emergency ordinance provides for an increase in the profit margin from 2% to 10% in the procurement process and that the natural gas supply component will increase by 25%.

Adrian Vintilă also said: "We know that within the groups of energy producers and suppliers there is a desire to recognize balancing costs, and here we will have an increase from 5% to 10%. (...) The graphs show us a visible evolution of the price, a downward trend, below 403 lei/Mwh and I believe that we need to make changes to create stability in the market".

The advisor to the Minister of Energy also showed that on March 25, the public debate on the draft law related to contracts for difference (CfD), a mechanism for which the European Commission allocated Romania 3 billion euros for 5000 MW, will also end.

Adrian Vintilă said: "After the approval of the normative act, this year we will auction 1000 MW for wind and 1000 MW for solar energy, and next year 1500 MW for both components. (...) CfDs will be concluded for 15 years, with the possibility of price indexation after the first 3 years. We are talking about a mechanism that is expected by all stakeholders in the energy market".

• Prosumers, a growing category

During the conference, the president of the Senatorial Commission for Energy, Energy Infrastructure and Mineral Resources, Istva-Lorant Antal, said that the prosumers already represent an important community of electricity producers and that is why last year Parliament adopted the law that allowed them to do monthly settlements, settlements from the electricity surplus with the natural gas bill provided that it is from the same supplier, but also the allocation of the surplus to other points of consumption or to third parties. Unfortunately, that law was re-sent to the Parliament for re-examination by President Klaus Iohannis.

Lorant Antal stated: "We have debates. I had two meetings with energy actors. I hope that next week the normative act in the re-examination procedure will pass the plenary of the Senate and we have the promise of colleagues in the Chamber of Deputies that they will return to the initial decision regarding the maximum ceiling of 900 kw for the production capacity of a prosumer and that the ceilings of 200 will be passed into law and 400 kw, as they appear in the European directive and that there will be no further problems with promulgation. I hope that in a month this normative act will come into force".

Regarding the prosumers, Viorel Alicuş, director at ANRE, stated that in the last year the number of requests for connection to the network has increased considerably and that the commissioning of all production capacities, including those built by the companies in the field, puts a huge pressure on transmission and distribution networks and the regulator is trying to make these connections on competitive basis and on viable projects.

Mr. Alicuş said: "Steps must be taken to evaluate the networks, the costs of capacity availability for all voltage levels for the connection of all production capacities from renewables and not only, let's see what costs mean. At the moment we have over 120,000 prosumers that have a total installed capacity of almost 2000 MW".

Laurenţiu Urluescu, the president of AFEER stated that the increase in the number of prosumers is not a very big challenge for suppliers and that the risk concerns only the surplus of electricity produced in the hours when the price is low and the deficit of energy in the hours when the price is high, which which attracts higher costs for providers, costs that will be socialized and ultimately borne by the classic consumers who will pay for this risk of the prosumers.

Adrian Vintilă, the representative of the Minister of Energy, reiterated the fact that the prosumers will not pay the so-called sun tax and that a viable solution is to oblige them to store energy, noting that already, on the Electric-Up 2 program, the storage obligation is provided for each individual project which receives funding from the budget.

We mention that the organizer of yesterday's event, the Association of Energy Suppliers from Romania - AFEER, established in 2006, currently includes a number of 37 members, suppliers and traders licensed and active on the electricity and/or natural gas market , which ensures the supply of energy both to individual consumers, as well as to SMEs and consumers from all categories of economic agents, operating in Romania, with a market share of about 85% of the final electricity consumption and natural gases.