The Government will remove both increases in gas liberalization timetable set this year for the industry. According to a draft Emergency Ordinance, the timing of liberalization of gas prices for industry, which included two increases in 2014 that could have led to the closure of more than 50% of production capacity in the industry in a pessimistic scenario is postponed again.
Only the liberalization schedule for households remain in force, which includes, in a first stage, increases of 20% of the price of gas by the end of next year, according to economica.net.
The Government motivates the removal through the aligning of domestic gas prices with those from import. “The convergence of gas prices is done. Needless to make price increases for the industry, as were the previous commitments. Through the adoption of the proposed package for public debate, the final price of gas will not increase, existing premises even to decline in the coming months”, said Răzvan Nicolescu, Minister for Energy.
The note accompanying the enactment shows that deregulation is done during the summer because it generates a lower social impact, because prices will be determined on the basis of market supply and demand, and that a transition period to prepare plants to operate in a free market is required, so as not to distort the ongoing contracts.
“By March 1, 2015, non-residential customers of natural gas are required to choose their gas supplier and sign with him a sale – purchase contract at a negotiated price. Suppliers are required to submit to their non-households costumers, in due time, notifications on the requirement to sign commercial contracts at a price negotiated price, offers and information on the legal possibility to switch their supplier”, shows the background.
Gas prices for industry could decrease in the coming months
Gas prices for industrial consumers could fall in the next period after the Department of Energy will implement a package of measures to boost and to make more transparent the market, said the Minister for Energy, Răzvan Nicolescu, in a statement sent to Agerpres.
Department of Energy has launched a public debate about a draft Emergency Ordinance which includes a number of changes to be taken quickly to boost natural gas market and increase the transparency of transactions in the sector, says a statement from the institution.
“The Department of Energy believes that regarding non-household consumers and on the basis of data supplied by the National Energy Regulatory Authority (ANRE) the convergence in gas prices between domestic and import was achieved, convergence agreed by the Romanian State with international financial institutions. Therefore, for industrial consumers, we do not believe that there is a need for an increase of the tariff”, say the Department officials.
Department of Energy requests ANRE to complete the review process of the Network Code as soon as possible for a better market performance. Moreover, the Department proposes that for industrial consumers (on the regulated market) to be a transitional period of eight months, necessary to conclude in a competitive manner new supply contracts.
“To boost the market and increase transparency, the Department of Energy proposes for a fixed period, between 1 July 2014 and 31 December 2018, that natural gas producers to mandatory transact transparently, non-discriminatory and centralized a given gas volume that will be established by ANRE. This obligation will be applied, from 1 March 2015 to 31 December 2018, to suppliers of domestic and imported natural gas. Department of Energy considers that the measures taken will contribute to a better functioning of the gas market in Romania, with benefits to all operators involved, but also for consumers”, reads the statement.