Catastrophic Policies Have Made Romania Energy Dependent

This amalgamation of factors has put great pressure on the 35 per cent of the electricity mix of Romania that relies on hydrocarbons - coal plus gas.

Against the backdrop of the cost problems facing Romanian coal production, the risk of a tumultuous and disordered energy transition is increasing.

Lack of investment in coal in recent years has had a strong impact on this sector in Romania, which has suffered under the pressure of spiking carbon prices.

The effects of the reduction in coal electricity production will begin to impact the country's two gas-fired power plants, Brazi and Iernut. To ensure the flexibility of the electricity system, these two production capacities will have to consume more and more natural gas.

Romania saw the largest increase in imports of Russian natural gas of any country apart from the Netherlands. Archive Photo: EPA/SZILARD KOSZTICSAK

With ever-declining domestic gas production and poor coupling with the regional gas market, the limitations of the Romanian energy sector are really beginning to be felt.

On one hand, it has turned Romania into a net importer of electricity when consumption peaks. On the other, because of the limited production possibilities, the pressure on the price of gas is increasing.

If we also take into account system losses due to obsolete infrastructure, the state of the Romanian energy system is directly reflected in consumers' bill and in the quality of the services offered.

The Romanian market has become increasingly rigid, moreover, when gas and electricity prices in the region are falling.

Frequent changes in the fiscal framework for the exploitation of natural gas, the return of politically driven price regulation and lack of truly...