On Thursday, the government changed the scheme to limit the compensation of electricity bills where it had introduced some mechanisms for the wholesale marketwhich, according to the authorities, would lead to lower bills. The final invoice price remains limited until March 31, 2025, although the government would like to extend the limit until 2026, but according to HotNews.ro, the European Commission has not agreed.

“End customer restrictions remain until March 31, 2025. As market prices continue to fall, we will take appropriate action. Usually, at low prices, there will be no need for these ceilings from March 2025. Romanians’ bills should not increase,” Energy Minister Sebastian Bourduia said during a briefing at the end of the government meeting.

It comes after he said two weeks ago that one option was to extend the scheme until 2026.

According to HotNews.ro, the intention of the Romanian authorities to extend until 2026 the ceilings for both the population and companies was not approved by the European Commission, given that Romania is the last country in the EU that still applies subsidies as a result of the energy crisis 2021-2022 years.

• The European Commission is analyzing whether the electricity price compensation scheme in Romania is legal

In addition, at the briefing, Burduzha stated that the authorities in Brussels support directing subsidies only to vulnerable consumers, and not to all, as is happening now.

What else did the minister say on this topic:

• The European Commission is asking us to better target these measures at vulnerable consumers, which most European countries have done.
• (When asked what the European Commission said about the expansion of the scheme) We held negotiations last week in Brussels. Currently, the scheme is not being expanded.
• Competition mechanisms usually operate below these limits. It is difficult to walk on ceilings, it will be expensive for suppliers to change the payment system.
• Prices will fall anyway, the state does not need to intervene all the time with measures to further lower the ceilings.
• The European Commission is telling us very clearly: we must move towards a more competitive market, where market mechanisms determine the price drop, where competition between suppliers and the choice of Romanians to switch to the most competitive, cheaper suppliers determine the lower price on their bills. And it will happen. You can also trust Romanians to know how to pick the best deal.

What does the European Commission say?

HotNews.ro asked the European Commission whether the price compensation scheme in Romania and its extension complies with European rules.

“The commission is still analyzing the matter and is in contact with the Romanian authorities to better understand the scheme. As a general principle, Member States’ intervention in prices should comply with EU rules on the energy market,” the Commission representatives replied two days ago.

During the crisis, Council Regulation (EU) 2022/1854 allowed member states to regulate prices for the public and for SMEs under certain conditions: non-discrimination between suppliers and fair compensation to suppliers.

This option expired on December 31, 2023, and only normal free market rules apply at this time.

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