The mayor is also calling for assistance from the Supreme Defense Council and Romanian Intelligence Service. Oprescu blames this state of affairs on ELCEN and energy regulator ANRE’s “abusive and discretionary” procedures.
City Hall suggests the situation might be defused by renegotiating the frame contract between RADET and ELCEN, imposed by ANRE, and by approving the memorandum put forward by City Hall, which regulates the contractual relations between RADET and ELCEN, and forgives the distributor’s penalties for overdue payment.
Another solution might be for City Hall to take over the energy and heating producer units CET SUD, CET VEST, CET Progresul and CET Grozavesti, improving the energy system’s efficiency and having immediate positive effects on the public and the city’s budget.
RADET’s debt to ELCEN plus penalties amounted to 1,146,840,404.37 lei (almost EUR267 million) on October 4, 2011.
On November 29, the Bucharest Council adopted a bill authorizing City Hall to ask the Government to erase RADET’s penalties for its debts to ELCEN, and request an exemption from the frame-contract approved by ANRE, so that the deadlines of ELCEN’s bills to RADET and of RADET’s bills to the end-consumers would be identical.
RADET buys more than 90% of its heating energy from ELCEN, which owns the main plants around Bucharest. Because of RADET’s debts, ELCEN has been unable to pay its debts to raw material suppliers; it owes Romgaz alone around RON460 million.
On October 30, deputy mayor Mircea Raicu said the Government, as sole shareholder of ELCEN, has agreed to pay the penalties and interest on RADET’s debts, as long as City Hall pledges to pay the base debt in a timely manner. (EUR1=RON4.298)