All companies with stakes in energy and gas distribution in regulated regime, will call ANRE in court to cancel the order and methodology that has diminished their Regulated Rate of Return (RRR) to 7.7%, said for energynomics.ro sources from the electricity distribution sector. Recently an information appeared in public, that the group Electrica S.A. and its distribution subsidiaries claim in court the cancellation of the order.

Sources have confirmed to energynomics.ro that Enel, CEZ, Transgaz, Transelectrica and Fondul Proprietatea have submitted or will submit such a claim in the Romanian courts. On the courts portal, portal.just.ro, you can access general information submitted by Fondul Proprietatea and CEZ Distributie in section VIII Administrative and Fiscal at the Bucharest Court of Appeal.

Enel representatives told energynomics.ro: “We confirm that the three distribution companies of Enel brought legal actions in contradiction with ANRE, to cancel the orders regarding the approval of the specific tariffs for electricity distribution service and the price for reactive electrical energy.

Also, we confirm that the three distribution companies have filed legal actions in contradiction with ANRE, to cancel the order no. 146/2014 regarding the establishment of the Regulated Rate of Return applied to the approval of tariffs for the distribution services of the prestart electrical energy, by the distribution concession operators from 1 January 2015 and the repeal of art. 122 from the methodology for establishing the tariffs for electricity distribution, approved by the ANRE President Order no. 72/2013.”

RRR for electricity distributors declined from 1 January from 8.52% to 7.7%. Fondul Proprietatea, a significant minority shareholder in many energy companies in Romania, said that the decrease in profitability rate leads to a decrease in the operators profit up to 12% over the previous year.

Transelectrica has informed its shareholders at the end of August 2014 about the initiation of a litigation with ANRE, because the concerning order decreases the company’s profitability by about 138.5 million Lei during the regulatory period valid until 2019, with the potential to destabilize the financial situation of the company in the coming years.

Along with the opening of the litigation, Transelectrica wrote ANRE three alternative proposals that would have stopped the dispute: the modification of the order, the use of a RRR of 9.87% or to keep the, 8.52% value.

ACUE Employers Federation, whose members are energy companies with aggregate turnovers of over 4 billion Euro a year, indicated at the end of November 2014 that, because of this modification, the investment plans are jeopardized.

“Legislative changes and of the regulatory framework equally affect both the private companies as well as the state companies from the energy sector. Such changes only contribute to the instability and unpredictability of the business environment, preventing companies to undertake investment programs in the context which the Required Rate of Return of the necessary capital is uncertain.

In this case, all investment strategies of the ACUE member companies from the distribution networks are affected significantly by preventing them to increase the operational efficiency and the quality of customer services”is written in the ACUE press release.