eft energonews energonews 12 august...slogan, varujan vosganian during tariceanu government, favored...
TRANSCRIPT
EFT ENERGONEWS 12.08.2013
1. INTERNAL PRESS
1.1.A. Electricity
GOVERNMEN’S INTENTIONS IN THE DRAFT LETTER TO IMF
Energy reform effort remains incomplete
Energy reform effort remains incomplete, highlights the Government in a draft of the letter to the
IMF, adding that corporate governance reforms are incomplete and the draft law on Corporate
Governance in SOEs continued to stagnate in Parliament.
In the cited document it is stated that Hidroelectrica risks losing the gains it achieved during
the period when it was insolvent and that there were new challenges to the reform agenda.
"There are accumulations of pressure of delaying the implementation of the roadmaps for the
liberalization of energy prices and the precarious financial situation of electricity producers and
the heat energy with high costs threatens to undermine broad energy strategy," said the
authorities in the draft letter.
They say that all new bilateral contracts of electricity producers would be completed in a
transparent and non-discriminatory way, by OPCOM power exchange.
For electricity, the complete deregulation of electricity prices for industrial consumers would
be made until early next year and for households by the end of 2017. For natural gas it is
intended to implement the roadmap for deregulation of prices in the industry by the end of 2015
and by the end of 2018 for households.
"We also intend to sell the majority of companies portfolio under the Ministry of Economy and
complete the following five privatizations of state-owned energy companies during the program,
sale that will generate sources for companies and administration and support the development of
local capital markets" , reads the document cited.
Final consumption of electricity decreased
Final consumption of electricity in the first half of this year was 24.881 billion kWh, 7.5% lower
compared to the first half of last year, according to the National Institute for Statistics (INS).
In the analyzed period, public lighting decreased by 9.1% and household consumption was 0.9%
lower. However, the primary energy resources decreased by 15.2% in the first six months of this
year, while electricity resources fell by 6.9%, also shows the INS data.
Decreased energy resource was due primarily to decreased production by 5.8%. However,
Romania imported 45.6% less gas, 26.5% less oil and 20.4% less coal in the first six months of
the year
Electricity imports decreased by 53.5% and petroleum products by 27.9%. Export of electricity
was 588.1 million kWh, 84.1 million kWh down, i.e. 12.5%.
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Energy resources after six months: Thermo-electric power stations production decreased
by 26%, and hydropower plant increased by 16%
Primary energy resources in the first half of the year fell by 15.2% compared to the same period
of last year, while electricity fell by 6.9%, according to data announced Thursday by the INS.
"The main primary energy resources in the first half of 2013 totaled 14652.2 thousand tonnes of
oil equivalent (toe), 2631.4 thousand toe down compared to the first half of 2012. Domestic
production totaled 10572.7 thousand toe, 7.6% down compared to the first half of 2012 and the
import was 4079.5 thousand toe, 30.2% down" says the National Institute for Statistics (INS), in a
statement.
In the analyzed period electricity resources were 29.054 billion kWh, 6.9% down, mainly due to
production lower by 1.757 billion kWh (5.8%).
Production of thermo-electric power stations was 12.14 billion kWh, a decrease of 26.4%.
Hydropower stations delivered 8.494 billion kWh, an increase of 15.9%, nuclear power station of
Cernavoda 5.663 billion kWh, 3.8% up. Production of wind power stations was 2.413 billion kWh,
an increase of 1.226 billion KWh.
Final electricity consumption amounted to 24.881 billion kWh, 7.5% lower than in the first half of
2012. Public lighting decreased by 9.1%, while household consumption fell by 0.9%.
Exports of electricity was 588.1 million kWh, 84.1 million KWh down, i.e. 12.5%.
ANRE increased rates for system services of Transelectrica by 23%
National Regulatory Authority for Energy (ANRE) decided Wednesday to increase rates for
system services of energy carrier Transelectrica Bucuresti (TEL) from 10.91 lei / MWh to 13.42
lei / MWh, i.e. an advance of 23 %.
This activity does not bring long-term profit to the company, but from one period to another there
can be some differences that distort in a quarter or another the profit reported by Transelectrica.
For example, in the first quarter Transelectrica income from ancillary services outrun by 25.9
million lei the company expenses with this activity, while functional system service revenues were
12.9 million lei higher than the costs with functional system services.
In the first three months of the year Transelectrica reported a profit of 91.7 million lei, double
compared to the same period in 2012, an explanation for this development being also the profit
made by the company from system services of 38.8 million lei, which will most likely be canceled
in the coming quarters.
"Occasional differences may appear but normally the increase of the rate for system service
does not affect the profit of Transelectrica as the revenue generated by this activity can be found
in the company's expenses," says Iuliana Mocanu, Head of Analysis Department of Raiffeisen
Capital & Investment.
According to the ANRE decision, the new price for ancillary services is 12.28 lei / MWh, while
functional system services tariff will be 1.14 lei / MWh.
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At the beginning of the year ANRE approved the increase of transmission tariff of Transelectrica
by 12.7% from 18.77 lei / MWh to 21.16 lei / MWh, which had a positive impact on company’s
profitability.
ANRE revised the methodology for determining the regulated tariff charged by OPCOM
National Regulatory Authority for Energy (ANRE) revised the methodology for determining the
regulated tariffs charged by operators in the energy sector centralized markets, approved by
ANRE Order no. 17/2010, the new project being posted on the authority's website for public
debate. "The revision was necessary to update the regulatory framework as a result of the
ageing of electricity centralized and green certificates markets in Romania, and of the
transposing of the provisions of the Act for Electricity and Natural Gas no. 123/2012", said ANRE
on Friday.
According to the institution, regulated tariff will apply to electricity centralized and green
certificates market participants and will pursue more accurate allocation of justified costs
associated with the activities carried out by the electricity market operator.
Among the main changes to the project for the revision of the methodology for determining the
regulated tariff charged by the electricity market operator OPCOM, there is the fact that regulated
tariff will apply to obtain regulated revenue for activities of electricity market operator in electricity
centralized and green certificates markets for calculating payment obligations / collection rights of
participants to centralized market and balancing market and calculation of payment obligations/
collection rights for imbalances of parties responsible with the balance.
ANRE states that, under the new law, the regulated tariff will consist of several components,
such as affiliation in centralized markets, administration of centralized markets, implementation of
centralized markets transactions in which the energy market operator is the counterpart,
component of achieving centralized markets transactions through which electricity is traded
through bilateral contracts and green certificates, those regarding the regulated tariff will apply to
participants according to the agreements to participate in centralized markets. "Regulated tariff
will be paid by the centralized market participants who are direct beneficiaries of the electricity
market operator services," notes ANRE in issued press release.
Draft methodology for determining the regulated tariff charged by the electricity market operator
has undergone public debate and can be consulted on the website www.anre.ro, Legislation
Category, EE Discussion document Section, Pricing Methodologies / Procedures column.
Following proposals / comments received from market participants and from the stakeholders will
result in the final draft to be submitted for review and approval in one of the next meetings of
ANRE Regulatory Committee.
What lies behind the decision to postpone the liberalization of gas market ?
Chairman of ANRE, Niculae Havrilet announced that the liberalization process of the gas market
will be delayed by one year for industrial consumers, i.e. until 31 December 2015. Decision made
by ANRE would be also agreed by the International Monetary Fund, says Mr. Havrilet, but if there
would be significant differences between the import gas price and domestic production gas price.
On the other hand, chairman of ANRE says nothing about the position of the European
Commission, which insisted for almost 6 years for Romania to liberalize the gas market, as
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actually happened in the field of electricity. It is for these two reasons we will try to understand
how ANRE came to make such a decision and who is behind it.
Delaying market liberalization, namely the price of natural gas has been strongly demanded
lately by one of the largest industrial consumers in Romania, Interagro, owned by Ioan Nicolae.
Unionists were brought in the street, intense media campaign was paid big money and even a
new employer was formed (above that already existing) of the so-called large gas consumers in
Romania, all in order to postpone the liberalization process.
Protection with DNA at the gate
Amid the bustle, the Minister of Economy Varujan Vosganian and Prime Minister Victor Ponta
hinted that the will of industrial consumers is in full accord with the will of the government: local
industry must be protected at all costs from the adverse effects of liberalization. Under the same
slogan, Varujan Vosganian during Tariceanu government, favored certain industrial consumers
(the first being Interagro) to purchase natural gas from domestic production only, damaging
Romgaz with several hundred million lei, for which DNA has already opened an investigation.
Result, the domestic industry is in the same energy-intensive situation, even if the aim of the
mentioned measure was refurbishment. We will return to this point.
Do you think that in a year, 2013-2014, this industry, once again favored, will make the step
towards performance, or towards increasing energy efficiency?
Let’s test their reaction
Let's come back to the "IMF approval" to the delay of liberalization. If it is real, then how come
the prime minister himself did not come forward with this important announcement, following
which he would have won some electoral capital? Or Varujan Vosganian declared himself a
follower of domestic industry protection? We have the answer: "a final decision on the extension
in 2015 of deadlines for market liberalization will be made in 2014, depending on the prices to be
at that time in the international markets," said the chairman of ANRE. Meaning, we postpone
liberalization, but not yet. For now, we test the reaction of IMF and European Commission, and
then we see how we proceed. It is important that we give a positive signal to the Romanian
people, who is just threatened by new taxes.
The trick with the price difference
We recall that Romania's commitments to liberalize gas and energy markets dates back to 2007.
If in energy situation evolved, instead in gas nothing has happened in terms of market opening.
The reason? The difference between the price of domestic production gases and that of gas
produced in Russia was very large, the ratio being even 1 to 3 at a time, or even higher. This
ratio is now about 1 to 2 and the trend is still of reduction.
In other words, the time of market opening is favorable as possible, in the sense that the shock of
price appropriation can be significantly mitigated. And then, how we explain the argument of
liberalization postponement on reason that "import price is around 390 dollars per thousand cubic
meters, while the price of domestic production gas is 196 dollars per thousand cubic meters, so
the difference is from simple to double," according to chairman of ANRE? Will are telling you
now. In fact, Gazprom is willing actually to sell gas with 250 dollars / thousand cubic meters, only
to have safety in the market.
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2. ANRE, Transelectrica, OPCOM useful information
ANRE Last 5 orders
2121 / 2013-07-19
AI CENTRALA COGENERARE BIOMASA, BIOENERGY SUCEAVA
2122 / 2013-07-19
AI CF ARICESTI RAHTIVARI 4, FORT GREEN ENERGY
2123 / 2013-07-19
AI CF ARICESTI RAHTIVARI 5, SOLAR FUTURE ENERGY
2124 / 2013-07-19
AI CF ARICESTI RAHTIVARI 6, CASA CRANG
2126 / 2013-07-19
AI CEE MIREASA 1, MIREASA ENERGIES
Last 5 orders
58 / 2013-08-02
Order – on the amendment of ANRE Order no. 52/2012 on the approval of average tariff for
transmission service, of tariff for system service, of tariff charged by electricity market operator
and of area tariff related to transmission service, charged by economic operators in the electricity
sector
54 / 2013-07-19
Order –on the approval of the Framework Contract for transmission services, system services and
services provided by electricity market operator to electricity participants, between the Electricity
Transmission National Company Transelectrica SA and beneficiary
53 / 2013-07-19
Order – on the approval of Methodology for setting electricity transmission service rates
56 / 2013-07-19
Order – for the amendment and supplementation of Green Certificates Issuance Regulations,
approved by Order no. 43/2011
49 / 2013-07-12
Order – approving the Regulation on the organized framework for trading on centralized dual-
continuous negotiation market of bilateral electricity contracts
OPCOM
Green certificate market
Weighted average price of GC for the latest 3 months traded on CMGC completed (March 2013-May 2013), calculated according to Law 134/2012, is 180.22 lei/ GC
DAM recorded prices
Prices and volumes 07.08
08.08 09.08 10.08 11.08 12.08 13.08
Average Price [Lei/MWh] 214,15
225,3 222,63 221,92 162,9 199,95 226,51
Balancing market price (450 Lei +DAM price)
664,15
675,3 672,63 671,92 612,9 649,95 676,51
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Total daily DAM traded volume 48.008 48.521 48.607 39.657 36.473 43.718 43.547
ROPEX_FM_M Term markets (PCCB) 2012-2013 [lei/MWh]
Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec
ROPEX_FM_2012 217,82 210,23 216,25 216,44 214,36 215,45 215,19 212,94 217,15 220,40 222,46 223,00 223,13
ROPEX_FM_2013 211,89 232,39 230,82 224,97 217,35 213,30 211,42 211,44 209,35 205,62 203,38 202,86 202,89
TRANSELECTRICA
Generation
Consumption/Generation
Daily averages
Consumption Generation Coal Gas Water Nuclear
External Balance
Wind Photo Biofuels
06.08 6214 6246 204
3 124
1 1339 1370 -32 168 51 34
07.08 6357 6426 206
5 134
7 1478 1373 -69 82 47 33
08.08 6478 6626 195
7 136
1 1698 1373 -148 155 51 33
09.08 6441 6447 216
6 113
7 1610 1371 -6 72 57 33
10.08 5911 5964 188
9 118
4 1168 1376 -54 257 57 33
11.08 5331 5330 183
4 912 906 1377 1 220 48 34
Comparative amounts same day, different years
On Tuesday 06.08.2013 Tuesday 07.08.2012
Electricity consumption
Medium 6245 7115
Maximum 7055 8129
Export/Import 22(export) 84(import)
Average power produced
TOTAL (Pmed) 6267 7031
Out of which:
Coal 2041 3265
Hydrocarbon 1244 783
Nuclear 1367 1370
Wind 172 76
Water 1360 1527
Biofuels 33 -
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Charts, Maps
Forecast of flows and levels
in the period 11.08.2013, 07.00 – 18.08.2013, 07.00
Flow at the entry in the country (Bazias section) will be stationary in the first four days of the interval, then
with slight increasing trend, with values between 2450 - 2500 m3 / s, which is below the multi-annual
average of August (4300 m3 / s).
On sector, downstream of Portile de Fier, the flows will be decreasing, except the last two days of the span
when they will be relatively stationary on Gruia-Zimnicea sector
Photovoltaic 51 -
36.0% Coal – 2,480 MW
15.0% Water – 1,031 MW
15.3% Hydrocarbon – 1,056 MW
19.9% Nuclear – 1.371 MW
11.3% Wind – 779 MW
1,9% Photo – 132 MW
0.5% Biomass – 33 MW
Total 6882 MW – Generation on 12.08.2013 12:46:33
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