Electrica Group, an energy distributor and supplier, announced on Thursday a net profit of 620.4 million lei in 2023, which is 11% more than the previous year. Profits were higher despite the fact that the customer portfolio and, as a result, the amount of energy delivered decreased. In addition, Electrica clarifies that it still has a 1.9 billion lei subsidy to recover from the Romanian state based on the price cap and compensation scheme governed by GEO 27/2022.

It will be recalled that Romgaz also announced a profit that is 10% higher than the previous year and amounts to 2.81 billion lei. In addition, Hidroelectrica recorded a historical profit that increased by 42%, from 4.4 billion lei to 6.3 billion lei.

These companies were massively helped by GEO 27/2022 on price regulation, a regulation issued against the backdrop of the 2022 energy crisis. Although the energy crisis has since ended, the provisions remain in place, continuing to help producers and suppliers of electricity and natural gas.

Electrica – less customers, less revenue, more profit

According to the company’s previous report, EBITDA at the level of Electrica Group increased by 27.1%, respectively, by 369.8 million lei, reaching 1.7 billion lei, compared to the value of 1.3 billion lei reached in 2022 .

Operating profit increased by 22% to 1 billion lei, thanks to the positive impact of operating expenses of 688.6 million lei, which was offset by a decrease in operating income of 506.4 million, Electrica said.

The net profit for 2023 increased by 61.6 million lei (11%), the result obtained mainly as a result of the operation of the distribution segment in the context of the reduction of electricity costs to cover CPT – technological self-consumption, as a result of the implementation of the centralized procurement mechanism MACEE, according to with which producers have an obligation to sell 80% of the available energy at a price of 450 RON/MWh.

In the electricity distribution segment, revenues increased by approx. 1 billion lei, or 29.9%, to 4.4 billion lei, from 3.4 billion lei in 2022, mainly due to the effect obtained from the increase in recognized revenues, to which was added an increase in distribution tariffs and a decrease in the volume of distributed electricity.

Regarding the supply segment, revenues decreased by approximately 905.8 million lei, or 11.1%, to 7.2 billion, from 8.18 billion lei in 2022, due to a decrease in the volume of electricity supplied by approximately 9%, following a decrease in the customer portfolio, and also due to a reduction in consumption at the national level (due to higher electricity prices as well as implemented energy efficiency measures), Electrica also says.

For the supply segment, both in 2023 and 2022, the effect of retail electricity prices was covered by subsidies received from state bodies, as a result of the application of the price ceiling mechanism for electricity and natural gas, as a result of the application of Decree 27/2022 with subsequent amendments and additions .

On December 31, 2023, the estimated amount of subsidies to be received from the Ministry of Energy is 2.6 billion lei, and from the County Agency for Payment and Social Inspection – 19.0 million lei. Of the value of the subsidies to be collected, the sum of 1.9 billion lei represents unreceived requests submitted to public authorities.

16.% market share

More Electrica results in 2023

• The amount of distributed electricity is 17.05 TWh, which is 3.8% less compared to 2022. DEER serves approx. 3.93 million users in an area that covers about 40.8% of Romania’s surface;
• The volume of electricity released to the retail market is 7.8 TWh*, which is 9.1% less than in 2022, against the background of the general trend of decreasing electricity consumption; Electrica Furnizare supplies approx. 1.7 million places of consumption in the competitive market, as well as in the mode of universal service and last resort;
• Market share in electricity supply – Electrica Furnizare is one of the largest suppliers with a total market share of 16.61% and 10.25% in competitive mode, according to the latest ANRE report available, namely the November 2023 report;
• The Electrica Group continues to expand its portfolio in the field of electricity production, especially from renewable sources, currently has projects in various stages of implementation with a capacity of approximately 300 MW;
• The regulated asset base (BAR) in nominal terms is estimated at the end of 2023 at 7.2 billion lei.
• At the end of 2023, the operator Distributie Energie Electrica Romania (DEER) realized and commissioned investments worth 777.1 million RON, which is 101.7% of the annual cost of the commissioning program planned for 2023 (i.e. 764.1 million RON , of which 628.4 million RON plan for 2023 and 135.6 million RON for 2022);