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Price of gas sold by domestic producers will liberalise as of April 1, 2017
The price of gas sold by domestic producers will liberalise as of April 1, 2017, but that will not lead to higher final prices for consumers, said Niculae Havrilet, the president of ANRE.
“In October, the government issued an emergency order including two amendments to the gas law. The first one refers to article 124, that stipulated that gas producers must lay at market disposal quantities needed for the winter period for household consumers and the thermopower area. This request comes from the European Commission and says that a law provision which includes a priority means discrimination and asked for the elimination of the formula. The article changed saying that producers offer gas with priority only until March 31, 2017. That means that as of April 1, the government will no longer impose sale prices for natural gas,”said Havrilet at the annual conference of the Association of Energy Suppliers in Romania.
He explained that final prices will remain under control until 2021, according to the law, but showed that more consumers prefer to change their supplier.
“We will remain in the controlled area for supply prices where the law says the deadline is 2021, but considering that every consumer has the right to choose any supplier and any contract, we will see, as of April 2017 a permanent migration of consumers to suppliers who can offer better prices for natural gas than their current supplier,”the ANRE official showed.
According to him, changes after April 1, 2017 will not affect the price paid by people.
“In point of impact (for end users) I don’t think we will have special impact. We estimate there will not be any impact at present, the price of domestic gas is a little higher than international price, therefore there will not be a price rise”, he added.
Havrilet reminded that another change brought by the same emergency order to the gas law refers to the obligation of transactions made on the stock exchange for a certain quantity by gas producers and suppliers. “Until Black Sea gas is massively evacuated we will have a liquid and mature market in the natural gas trading area, according to the model and success of the electric energy market,” the ANRE president added.
In his turn, Corina Popescu, secretary of state in the Ministry of Energy, present at the same event, pointed out that final prices will remain the same until 2021.
“Prices for final consumers remain the same until 2021. We tried to go gradually toward liberalization, we try to set up market mechanisms to create liquidity and allow natural gas suppliers the possibility to buy gas at competitive prices and I hope this saving can be conveyed to end users. Things will be controlled and we wanted to give a direction to the natural gas market, the same as in the electricity market,” Corina Popescu said.
At the same time, Bogdan Chiritoiu, the chairman of the Competition Council showed that the state would continue to keep things under control even after full market liberalization, as it happens with RCA prices now.
“We are genetically built to prefer liberalization, competition to regulation, so competition can be introduced in a domain any time if the ministry tells us things are kept under control and there is no risk for the people. In case we reach final liberalization the state keeps levers for intervention in exceptional cases, as we did with RCA,” Chiritoiu said.
AFEER, the Association of Electric Energy Suppliers in Romania organize on Tuesday the second edition of the annual conference “Ten years of involvement in energy. What happens in the next 10 years?”