Romania's gov't strengthens energy subsidies for households

World

Romania's ruling coalition on Monday agreed to increase the intensity of the support extended by the government to households for their electricity and natural gas consumption over the February-March period, according to a report by Romania-insider.com.

A supplementary budget of RON 3 billion (appr. EUR 607 million) was earmarked for the two months. The subsidies are at least partly financed from a special tax levied on power producers' windfall earnings generated by the sudden rise in prices.

Furthermore, the authorities will take steps to ensure that the invoices sent by suppliers for the period since November, in breach of the regulations, will be rewritten, Prime Minister Nicolae Ciucă announced, G4media.ro reported.

The cap and subsidy support scheme enforced as of November 1 will be maintained, but the parameters will be revised. Thus, the maximum electricity price charged by suppliers is capped over the two-month period at RON 0. 8 per kWh (EUR 0.161) (instead RON 1/kWh). The households with a monthly consumption of under 500 kWh (compared to 300 kWh) will qualify for subsidies such as to pay a final price of RON 0.68 per kWh (EUR 0.1375/kWh) (RON 0.71/kWh previously).

Although the subsidized price has not decreased significantly, the subsidy will be available to more households after the monthly consumption limit was increased from 330 kWh to 500 kWh. The electricity price paid by small and medium-sized enterprises was capped at RON 1 per kWh. For the natural gas, a similar adjustment was operated: the price will be capped at RON 0.31 per kWh (EUR 0.0627), and the limit for household consumption was increased from 1,000 kWh to 1,500 kWh.

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