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Massive increase in import of electricity, stimulated by government policy: 38% in first five months. Trend continues
de Adrian N Ionescu , 19.8.2019
Romania imported 38% more electricity in the first five months of this year, compared to the same period of 2018, according to the most recent monitoring report published by the Romanian Energy Regulatory Authority (ANRE).
The phenomenon also continued in the summer months, when Romania was usually an exporter of electricity.
Since the beginning of August, net imports have been consistent, with average hourly powers of 700 – 900 MW, according to current Transelectrica’s data.
Fridays before noon (11.38 am), imports were at a power level of 725 MW (the difference between consumption and production of 5,931 MW), but imports got close even to 1,000 MW this summer.
The increase of imports is the effect of distortions created in the market by both regulations and the inflexibility of production capacities to cope with adverse conditions.
Figures show that production does not cope with consumption
In the first 5 months, imports increased even though domestic consumption decreased slightly, by 0.4% down to 23.53.
Exports decreased by 40%. Electricity production (24.95 TWh) was 6.5% lower than in the same period of 2018 – says the ANRE report.
Electricity imports increased to 1.59 TWh, in the first five months of 2019, compared to 1.15 TWh, between January and May 2018. At the same time, exports decreased from 2.70 TWh, down to 1.60 TWh.
Domestic users’ consumption in the competitive regime was 78% higher, while users who pay regulated prices consumed 16% less electricity. Companies’ consumption slightly decreased by 0.8%.
Rigid production structure, complicated by regulations
The expenditure of polluting producers (especially coal-based ones) for green certificates has considerably increased lately, in the context that investments in non-polluting technologies are low and slowed down by the lack of necessary financing, in state-owned companies.
Green certificates consume a large part of revenues (40% at CE Oltenia, last year). However, Romania’s electricity production is based on coal-powered plants at a rate of over 22%, also depending on how much wind exists for wind power stations.
Difficulties arisen from market developments have been complicated by regulations, starting with the ones that came with OUG 114/2018:
- capping the profit through expenses recognized by ANRE for all electricity producers,
- capping the price of natural gas from domestic production for domestic consumers, which has increased gas prices for coal-powered plants, and to
- the Government’s decision to increase compulsory gas stocks for winter (+10%) and water supplies from reservoirs (+25), compared to last year, which affected the electricity production in these directions.