Electricity suppliers face multiple challenges in the Romanian energy market. Among the main problems are excessive charging, delayed and uncertain settlement of support schemes and the bureaucratic process that can take up to 12 months to receive the necessary statements, said Laurențiu Urluescu, president of the Association of Romanian Energy Suppliers (AFEER).

“Suppliers have been sustaining subsidies to consumers throughout last year and the total amount claimed for last year is about 8 billion lei. Another major challenge is the significant increase in balancing costs, which has led to financial losses for suppliers. In addition, legislative instability and unclear regulations hamper their work,” Urluescu said at at the conference “Romanian Energy Market – Facts of 2025”.

In recent years, the wholesale electricity and gas market has been severely affected by tax measures and regulations that have discouraged trading. The introduction of the 98% tax on trading led to a collapse in liquidity, while the subsequent relaxation to 90% failed to significantly revitalise trading volumes. Comparing December 2023 with December 2021, the market is almost half of its previous volume, indicating a drastic reduction in competition and price visibility.

Laurentiu Urluescu emphasises the major impact on the market: “You can see very clearly in the graph how the first red stripe, the one marking the introduction of the 98% tax, simply killed the market. The second red line, the one showing the relaxation of the tax to 90%, has allowed some recovery, but we are far from the previous level.”

In the absence of a clear reference price and a sufficient number of participants in both the day-ahead (PZU) and over-the-counter (OTC) markets, market players are forced to operate in a climate of uncertainty. The number of participants on PZU has fallen by almost 40% compared to the period before the energy crisis, and on OTC the impact has been even more severe, with a 90-95% reduction in the number of participants.

Taxation, uncertainty and financial imbalances

One of the biggest obstacles in the current market is the support scheme and delayed settlements. Although suppliers have been obliged to support capped prices for consumers, many of the sums promised by the state have been blocked. Estimates of the arrears vary, with ANRE putting the arrears at around RON 3bn, while suppliers’ associations estimate that total debts in 2023 could reach RON 8bn.

“At the moment, the confirmed amounts are only for January 2024 and have only been partially paid. We can say that the suppliers have sustained almost the entire year 2023 from their own resources, without receiving the settlements promised by the state,” Urluescu explains.

In addition to overcharging and lack of liquidity, providers are also facing increasing balancing costs. While these previously accounted for about 5% of the procurement portfolio, in the past year they have risen to 20%, generating substantial losses. “Imbalance costs have exploded. We are only allowed to recognise 5%, but in reality they have gone up to 20%. The difference represents a huge loss for suppliers,” warns the president of AFEER.

Trends in 2025

An important indicator for the direction of the market is the evolution of prices in Europe, where recent increases in Germany and the Netherlands have also influenced the outlook for Romania. Gas prices for the winter 2025-2026 have seen a significant increase, fuelled by concerns about inventory reduction and global market instability. In an interconnected European market, any major fluctuation in one country influences the entire energy ecosystem.

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For household consumers, the liberalisation of the market could lead to higher prices, especially for those on very low capped tariffs. “At the moment, for those capped at 0.68 lei/kWh, energy represents less than 1% of their bill. In the event of market liberalisation, these consumers will be the hardest hit, as their prices will inevitably go up,” explains Urluescu.

However, 2025 could also bring opportunities if reforms are implemented to encourage liquidity and stabilise the fiscal framework. The question remains whether the market will be able to regain participants’ confidence or whether the current uncertainty will continue to dominate the Romanian energy landscape.

The conference “Romanian Energy Market – Facts of 2025” was organized by Energynomics with the support of our partners: Alive Capital, Elektra Renewable Support, Enevo Group, Hidroelectrica, Nano Energies, Software Media WEBUS 4 ENERGY, Think Blu Solution.