Energy Central-News Article

President Klaus Iohannis on Wednesday sent to Parliament for review legislation on measures applicable to end customers in the electricity and natural gas market between 1 April 2022 and 31 March 2023, as well as for amending and supplementing certain energy legislation. "We consider that some of the provisions newly introduced by the law approving GEO 153/2022 are likely to generate dysfunctions and imbalances in implementation and, therefore, should be re-examined by Parliament," says the head of state in the request for review. He says that the Parliament sent the law, on 10th May in view of promulgating it.President Iohannis notes that it is a reasonable expectation that the new provisions will also have an impact on the general consolidated budget. The Head of State also argues that the new provisions are likely to reduce the revenues from contributions to the Fund of electricity producers, especially those from renewable sources, by limiting the withholding tax on differences from hedging contracts only to entities established in Romania, and by exempting "companies providing balancing services with an installed capacity of less than 10 MW". As regards the impact on budgetary expenses, in the case of non-household consumers of natural gas, if in 2022 the annual consumption dropped under the level of 50,000 Mwh/year, the whole gas consumption for 2022 will be re-billed with the price cap of 0.37lei/kWh, the compensation being paid from the state budget.President Iohannis considers that, as the legislative initiative implies, evidently, amendments of the provisions of the state budget, the legislator had the obligation that aspects of the nature of the respective ones be correct and detailed, namely in the financial fie.He also points out that in the context of the energy crisis, as part of the measures aimed at strengthening energy security and the protection of final customers in the electricity market, a Centralised Electricity Purchase Mechanism was established and that by the law submitted for promulgation, the Parliament intervened, in substance, on certain aspects of Annex No 11, without, however, adequately detailing how the new provisions affect or do not affect the balanced and compliant functioning of the electricity market as a whole, in particular by modifying the functioning of the Centralised Electricity Purchase Mechanism. ‘We consider as necessary the re-analysation of the legislative solutions for the amendment and completion of the dispositions regarding the Mechanism for centralized acquisition of electricity. A thorough and detailed basis for the legislative solutions under discussion is necessary and compulsory not only as information but in order to allow adequate evaluation of the way in which the limits imposed through art.8 of the Regulation, included in the OUG no.153/2022’ Iohannis says.

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