The Romanian Commodities Exchange (BRM) is deeply concerned about the prolongation of the support measures for electricity and natural gas consumers, considering that they generate significant economic and legal risks. The BRM argues that the current proposal for an Emergency Ordinance (OUG) artificially maintains distortions in the market and affects competitive mechanisms.
In a memo (RO) addressed to Energy Minister Sebastian Burduja, BRM points out that price caps for consumers, regardless of their category, perpetuate an economically unfounded approach and have negative effects on the energy market. The institution considers that the application of generalised support schemes, without specifically targeting the needs of vulnerable consumers, leads to significant imbalances and puts pressure on the state budget.
The memorandum insists that intervention measures in the energy sector should be aligned with European trends and policies, which focus on 1/ eliminating regulated prices and general price caps through free market mechanisms to stimulate competition and energy efficiency, 2/ energy saving and optimising consumption, 3/ diversification of supply sources and infrastructure development, using public funds for projects that ensure long-term sustainability and energy security, 4/ solid protection for truly vulnerable consumers by focussing the necessary financial resources in the form of direct cash allocations to help with bill payments.
The BRM emphasises that gas prices in Romania have remained at competitive levels on the spot market and that recent fluctuations have been purely seasonal, which does not justify continued state intervention. Also, unresolved logistical problems, such as insufficient storage and transport infrastructure, are the main causes of price instability, not market mechanisms.
Romania, despite being one of the largest gas producers in the EU, remains the only country to apply generalised subsidies, which distort competition, limit investment and undermine the protection of truly vulnerable consumers. In addition, there is a discrepancy between the treatment of electricity and natural gas, with government measures favouring gas subsidies for a longer period, even though electricity prices are higher than the European average.
The BRM points out that price caps discourage responsible consumption and investment in energy efficiency, with subsidies going to non-vulnerable consumers, leading to a waste of public resources. Moreover, the draft ordinance creates a significant imbalance by maintaining the gas release programme (GRP) mechanism only on the electricity market and abolishing it on the natural gas market, thus affecting competition and transparency.
The Romanian state risks jeopardising energy security by discouraging investment, withdrawing strategic investors and delaying major projects such as offshore extraction in the Black Sea, warns BRM. Energy suppliers bear the cost of subsidies until they are paid by the state, which affects their cash flow and market sustainability. Moreover, the subsidy scheme contravenes European regulations and is already subject to infringement procedures, which may lead to sanctions and loss of European funds. In conclusion, BRM considers that the prolongation of these measures is unjustified and dangerous for the Romanian energy market, emphasising the need for an approach in line with European policies and oriented towards strategic investments and real protection of vulnerable consumers.
Simulated public debate
The draft Emergency Ordinance (RO) on the measures applicable to end customers in the electricity and natural gas market from 1 April 2025 to 31 March 2026 proposes to extend the price cap on energy and natural gas prices, as a continuation of GEO no. 27/2022. The document invokes the need to protect consumers and avoid a sudden increase in tariffs, while maintaining regulations involving substantial public funding to compensate for price differences. The draft GEO also introduces some changes to streamline payments to suppliers in an attempt to avoid previous financial bottlenecks. However, critics, BRM among them, argue that this extension is only a palliative solution, which does not address the structural causes of the energy market problems in Romania.
The Ministry of Energy published the draft law for public debate on 21 March and asked for “proposals, suggestions, opinions with the value of recommendations” by 24 March.