Romanian Senate caps electricity prices
The Romanian Senate has green lighted an emergency order under which energy prices for household consumers are subsidized until end-March.
Corina Cristea, 19.10.2021, 02:00
Electricity and natural gas prices for household consumers in Romania will be subsidised until the end of March, in keeping with an emergency order passed by the Bucharest Senate on Monday. Senators from all political parties decided unanimously that, while the order is in force, electricity prices will be capped at maximum 1 leu per kilowatt and the natural gas price at 0.37 lei per kilowatt-hour. Household consumers will thus benefit subsidies of 26 bani per kilowatt-hour for their electricity bill and of 33% of their natural gas bill by per month. Moreover, vulnerable consumers can also postpone payment of their bills by 6 months. Small and medium-sized companies will have their VAT slashed from 19% to 5% and will be exempt from paying the green certificates and the co-generation contribution.
Liberal senator Toma Petcu explains: “We have increased the subsidy level from 25% to 33%, which is a lot. Also, we have raised the ceiling for these subsidies to 1,500 megawatts for electricity and 1,000 megawatts for gas. I believe it is very important to allow vulnerable consumers to postpone the payment of their bills by up to six months. We have all agreed we need to put a cap on prices. The difference between the capped prices and the reference prices is subsidized and we get to the level proposed by our Social Democrat colleagues. All legal entities can definitely access this support scheme. “
Social Democrat senator Daniel Zamfir, although in favour of capping energy prices, says the normative act, in its current version, is not applicable. In his opinion, the legislative proposals of the Social Democrats, discussed in plenary session and rejected by vote, would have been a better solution to the energy price problem. Daniel Zamfir: “You chose, because of your ego, to kill our perfectly good initiative just because it comes from PSD. You did not have the gut to admit that the subsidy plan will be difficult apply and people will not benefit this measure. ”
Romania has seen the highest increase in energy and natural gas prices in the EU, the senator also said. The price of natural gas went up by 334%, so the subsidy solution would have been insufficient and the fact that all parties agreed to our idea of capping on prices is a good thing. We believe the levels of these caps are high and they can be modified once the law in the Chamber of Deputies, he also said. According to the document, the profit of energy producers will be overtaxed by 80%. The document, aimed at keeping energy prices in check, will be submitted to the Chamber of Deputies, the decision making body in this case. (EE)
