PROLONGATION OF ELECTRICITY AND NATURAL GAS PRICE CAPS
PROLONGATION OF ELECTRICITY AND NATURAL GAS PRICE CAPS
On 28 February 2025, the Emergency Ordinance No. 6/2025 on the measures applicable to end customers in the electricity market in the period 1 April 2025 – 30 June 2025, respectively the measures applicable to end customers in the natural gas market in the period 1 April 2025 – 31 March 2026, as well as for amending and supplementing certain regulatory acts in the energy field (“GEO 6/2025”) was published in the Official Gazette of Romania no. 182 and entered into force on the same date.
The price cap scheme for electricity and natural gas (which was set up in 2022 amid the energy crisis, being preceded by a compensation scheme valid in 2021/2022) as currently amended is temporary and will apply from 1 April 2025 to 30 June 2025 for electricity and from 1 April 2025 to 31 March 2026 for natural gas.
We have presented below a selection of the GEO 6/2025 provisions, namely we have referred briefly to (i) prolongation of electricity and natural gas price caps, (ii) price in standard offers, (iii) contribution to the Energy Transition Fund, as well as (iv) other relevant provisions.
1.Prolongation of electricity and natural gas price caps
The current scheme (applicable at the date of publication of GEO 6/2025 on the basis of GEO 27/2022) for capping electricity and natural gas prices will be maintained as follows:
a) the current mechanism for capping electricity prices at maximum levels of 0.68 lei/kWh, 0.80 lei/kWh, 1 leu/kWh and 1.3 lei/kWh depending on consumption and consumer category will be maintained until 30 June 2025, and
b) the current mechanism for capping natural gas prices at maximum levels of 0.31 lei/kWh and 0.37 lei/kWh respectively depending on the consumer category will be maintained until 31 March 2026.
In this regard, the statements and documents validly submitted to energy suppliers before entry into force of GEO 6/2025, in the application of the provisions of Government Emergency Ordinance No. 27/2022 on the measures applicable to end customers in the electricity and natural gas market in the period 1 April 2022 – 31 March 2023, and for amending and supplementing certain normative acts in the energy sector, approved with amendments and additions by Law No. 206/2022 (“GEO 27/2022”), are valid and produce legal effects for all administrative operations and acts regulated by GEO 6/2025.
Additionally, it is important to emphasize that the prices and consumption tranches can be amended by Government decision depending on the developments on the domestic and international electricity and natural gas markets and the geopolitical developments in the vicinity of Romania.
2.Price in standard offers
Given the prolongation of electricity and natural gas price caps, suppliers and final costumers alike should take into account that:
a) the price applicable for the period from 1 April 2025 to 30 June 2025 in the standard offers for electricity consumers covered by the cap scheme, drawn up and published by the electricity suppliers, may not exceed the amount of the final invoiced price referred to in point 1 item a) above, depending on the category of consumers concerned, while
b) the price applicable for the period from 1 April 2025 to 31 March 2026 in the standard offers for natural gas consumers covered by the cap scheme, drawn up and published by the natural gas suppliers, may not exceed the amount of the final invoiced price referred to in point 1 item b) above, depending on the category of consumers concerned.
3.Contribution to the Energy Transition Fund
As of 1st of April 2025, during the application period of the provisions of GEO 6/2025 (until 30 June 2025 for electricity and until 31 March 2026 for natural gas respectively), electricity generators, aggregated electricity generation entities, traders of electricity and/or natural gas, suppliers carrying out electricity and/or natural gas trading activity and aggregators trading quantities of electricity and/or natural gas on the wholesale market, as well as the partners in financial risk insurance contracts (hedging contracts) of electricity generators shall pay a contribution to the Energy Transition Fund.
However, (i) the generation capacities commissioned after April 1, 2022, as well as (ii) the companies which provide public heating services producing electricity through cogeneration remain exempted from this obligation.
4.Limitations on the standard offers after the end of application of electricity and natural gas price caps
For the period from July 1, 2025, to June 30, 2026, electricity suppliers shall prepare and publish/communicate standard offers only for periods for which they have purchased, at the time of preparing the offer, an amount of electricity equal to at least 50% of the consumption of end costumers in portfolio under competitive regime and universal service regime, as applicable, in the last month for which consumption data is available at the time of preparing the offer.
Likewise, for the period from April 1, 2026, to March 31, 2027, natural gas suppliers shall prepare and publish/communicate standard offers only for periods for which they have purchased, at the time of preparing the offer, an amount of natural gas equal to at least 50% of the consumption of the end costumers under competitive regime in the last month for which consumption data is available at the time of preparing the offer.
5.Other relevant provisions
GEO 6/2025 also includes other provisions (some of which are new rules while other represent changes to existing rules) regarding:
i. The compensation method of electricity / natural gas suppliers, including of electricity generators for the customers connected to their installations as well as of electricity distribution operators with the right to resell electricity.
ii. The obligation of natural gas suppliers/heat producers in cogeneration plants and thermal power plants as direct customers of natural gas producers (“PET Direct Costumer”) to maintain minimum stocks of natural gas in underground storage. The minimum stock shall be at least 90% (increased from 30% in the previous regulation) of the national underground storage capacity; the quantity of natural gas that has to be stored by each license holder is set by the transmission and system operator depending upon the quantity of natural gas estimated to be supplied by the relevant title holder between 1 April 2025 and 31 March 2026.
iii. Maintaining the obligation of natural gas producers carrying out both onshore and/or offshore extraction activities, irrespective of the starting date of these activities, and of natural gas sale activities to deliver, between 1 April 2025 and 31 March 2026, the necessary quantities of natural gas resulting from domestic production activities to suppliers/ PET Direct Customer/ network operators, at the price of 120 lei/MWh. The above-mentioned price can be amended by Government decision depending on the developments on the domestic and international natural gas markets and the geopolitical developments in the vicinity of Romania.
iv. Maintaining the obligation for electricity generators to trade at least 50% of their annual electricity production through contracts on electricity markets other than day-ahead market, intra-day market and balancing market in order to maintain adequate liquidity of the electricity market. However, generators having in their portfolio only wind, photovoltaic, micro-hydropower generation capacities benefiting from the green certificate support scheme and CHP capacities are exempted from this obligation.
v. As a novelty, regulating as misdemeanor the act of successive sale, i.e. sale between groups of affiliated or intra-group companies, of quantities of electricity or natural gas by traders and/or suppliers with trading activities or by traders and/or suppliers with trading activities having the same shareholder or final beneficiary, with the purpose of increasing the price. This misdemeanor is sanctioned by ANRE with a fine of 5% of the annual turnover of the offender.