The Bucharest City Hall must ask for the European Commission’s approval for the subsidies they grant to RADET, but this will not affect neither the heat supply of the capital, nor the price paid by consumers, said Bogdan Chiriţoiu, President of the Competition Council.

“I informed the City Hall several times in recent years that, when they are granting state aid for services of general economic interest over a certain level of 15 million euros per year, this must be notified to the European Commission. This is a legal obligation. You can decide under 15 million, at a national level, but above this amount it is required to obtain the consent of the European Commission. We suspect that in the case of RADET, this limit is exceeded and a notification to the European Commission will be required,” said Chiriţoiu, quoted by Agerpres.

He stressed out that this will not prevent the supply of heat and hot water in the capital and will not affect the prices paid by the consumers.

“The European Commission will not come to interrupt the heat, but will verify whether these subsidies are at a reasonable level. Obviously, the government is obliged to provide heating for the city, it is normal to pay a state subsidy for this, but at the same time, we must ensure that this subsidy is not excessive. This will be chacked by the European Commission”, said Chiriţoiu.

The Autonomous Administrator for Thermal Energy Distribution (RADET) has debts of about 3.6 billion lei to Electrocentrale Bucuresti (ELCEN), the heat and hot water producer for the Capital. Because of the debts accumulated by RADET, ELCEN in turn has accumulated debts worth about 1.8 billion lei, according to Agerpres.

ELCEN announced two weeks ago that almost half of the residents of the capital may remain without hot water in the next period, after Distrigaz decided to limit the flow of gas, due to amounts outstanding 147,2 million lei.

Earlier this week, the General Mayor of Bucharest, Gabriela Firea, said that the City Hall will perform in the coming days a payment of 13 million lei to RADET and 60% of this amount will go to ELCEN. “Together with the Minister we established what what to do next, namely: to ensure the cash flow for ELCEN, given that the City Hall, as it did in the two and a half months since I became mayor, will pay the current related legal subsidy. These day,s a payment of 13 million lei from City Hall to RADET will be performed and, after raising the seizure as the Minister has guaranteed, from the accounts of RADET: 30% will remain for RADET to pay salaries and routine repairs; 60% will go to ELCEN to satisfy and cover part of the eligible debt; 10% – other debts. This is the structure of the, now withheld escrow account, following a court order. That is not enforceable against the City Hall, but only against RADET,” said the general mayor.