Effects of the energy price hikes

Romania is one of the hardest-hit countries in the context of the soaring energy prices. Starting January 1, 2022, the energy market was liberalized, but for the last six months the authorities' faulty communication has generated chaos and difficulties for household users. Starting this summer, electricity and natural gas prices have skyrocketed. At the end of the 2021, electricity prices were capped for household users, and part of the energy bills are now state-subsidized until March 31, 2022. Until then, the ruling coalition will analyze whether it needs to improve the legislation, Energy Minister Virgil Popescu told Radio Romania. The Social-Democrats have criticized the current legislation, promoted by Minister Popescu and adopted by the former Parliament majority. The Social-Democrats now want to hand out vouchers to vulnerable consumers, simplify payment procedures for compensations awarded to energy distributors and expand the state assistance scheme for economic operators. Referring to industrial consumers, Minister Virgil Popescu says the government has also helped them overcome various issues linked to the recent price hikes:

"Industrial energy consumers do not benefit from the current law, but we had another assistance package, completed last year, whereby they were awarded 140 million Euro. ALRO Slatina, for instance, received a payment of 390 million lei in October as state aid. Azomureș, in turn, received 125 million lei, and these are but two examples of large companies that claimed the soaring prices make their activity unsustainable. We understand their problems".

Still, the ALRO Complex, the only producer of aluminum and alloys on the Romanian market and the largest in Central and Eastern Europe (with the exception of Russia), decided to stage a protest, after the board decided to cut back on production due to the energy crisis. Their trade union says over 1,000 employees risk being put on furlough, yet the effects may run much deeper, because ALRO works closely with other enterprises, impacting their activity as well. The aluminum factory in Tulcea also staged a protest, reducing production. People fear they will lose their jobs and have called on the authorities to intervene, so that industrial energy consumers may benefit from equitable prices. (VP)