“The largest energy producers operating on the Romanian market are majority owned by the state, except for some companies which recently entered the market. Therefore, the bulk of electricity used countrywide during the analysed period (2008 – 2013) was produced in power stations held by companies in which the state has majority stakes,” the council said in a report Thursday.
Prior to adopting government decision 429/2013, it could be considered that companies in which the state directly holds majority stakes can make decisions independently and the state would exert only some of the rights it is entitled to as majority shareholder. Currently, considering the tasks vested in the Energy Department, the Competition Council thinks the independence of decision-making within state-run companies could be affected by this provision.
After analysing Romania’s energy sector, the Competition Council issued several recommendations, among which, the introduction of financial instruments specific to this type of markets (for example, contracts for difference or options contracts), to help operators manage the financial risks generated by potential disagreements that may stem from demand and supply.
According to the Council’s analysis, Romania’s power consumption saw a continuous decline between 2011 and 2014, and the downward trend was expected to stabilize in the upcoming period.