The power market regulator, ANRE, approved a 5.96% regulated rate of return (RRR) for 2019 pre-tax retailers in real terms (indexed with inflation). The current 12-month bank interest rate is 3.5%, while the Finance Ministry drew money from banks at an annual return of 3.9% in the session last week.

At the same time, the Euribor lending rate on the European market is negative (-0.168%, at 12 months). Thus, the yield imposed by ANRE can be considered an excellent one if we look at the European market and a good one compared to the Romanian one, given that the leu-euro exchange rate remains relatively constant.

“In order to achieve the objectives set by the regulator by setting prices for consumers reflecting justified costs in terms of efficiency and competition, as well as by maintaining the interest of operators for investments, the ANRE Regulatory Committee approved the Order regarding the setting of the regulated rate of profitability applied at the approval of the tariffs for the electricity distribution service provided by the distributors as of 1 January 2019 “, the ANRE press release states.

The regulated rate of return (RRR) is a very important parameter considered when determining the regulated revenues of the distribution operators.

“We also point out that, in order to stimulate new investments, ANRE considers the additional remuneration of the investments made in energy capacities in the fourth regulatory period (2019-2023), one percentage point above the previous level.

“We believe that the value of the RRR approved for being used in calculation of tariffs for the electricity distribution service as of January 1, 2019 will lead to an optimum balance between maintaining the interest of realizing the investments necessary to ensure the quality of the electricity distribution service and ensuring a reasonable level of the profits of the distribution operators, according to the provisions of the regulatory framework established by the Electricity and Natural Gas Law no. 123/2012, as amended and supplemented”, add the press release from ANRE.

Autor: Bogdan Tudorache

Active in the economic and business press for the past 26 years, Bogdan graduated Law and then attended intensive courses in Economics and Business English. He went up to the position of editor-in-chief since 2006 and has provided management and editorial policy for numerous economic publications dedicated especially to the community of foreign investors in Romania. From 2003 to 2013 he was active mainly in the financial-banking sector. He started freelancing for Energynomics in 2013, notable for his advanced knowledge of markets, business communities and a mature editorial style, both in Romanian and English.