State-owned fossil fuel power producers aiming for EUR 160 million compensation from the government due to price-cap policy
Romania's Ministry of Energy is currently facing reimbursement requests from OMV Petrom, Romgaz, and CE Oltenia, three major power producers, for the costs they incurred purchasing CO2 certificates related to electricity produced under the price-capping mechanism. The total amount claimed is approximately EUR 160 million (RON 830 million).
The price-capping mechanism, intended to help fossil fuel power producers, is ambiguous when it comes to the procedure for reimbursement. Since these companies have not sold electricity above the capped prices, the Ministry of Energy is expected to reimburse the full cost of the CO2 certificates they purchased for the capped power.
OMV Petrom, Romgaz, and CE Oltenia are seeking reimbursement for the difference between the price paid on the market and the capped end-user price for the electricity they produced and sold. This reimbursement pertains to the value of CO2 certificates purchased for this power.
These claims are in addition to supplier claims under the same price-capping system, which amount to around EUR 1 billion. The power was sold at a capped price, RON 450 or RON 400 per MWh, depending on the period.
The Ministry must reimburse the power producers for the CO2 certificates, as they have not sold the electricity above the maximum set price. This information was obtained from sources consulted by Economica.net.
The article can be accessed by becoming a Romania Insider member or signing in. It is important to note that no further detailed updates on the Ministry’s concrete response or timeline for the reimbursements were found in recent reports.
(Photo source: OMV website)
This situation highlights the ambiguity in the price-capping mechanism's procedure for reimbursing the costs associated with CO2 certificates. The power suppliers are also entitled to recover the difference between the price paid on the market and the capped end-user price.
The total debt estimated at the end of last year for both power producers and suppliers is approximately EUR 1 billion. No advertisements were extracted from the information. This information is based on sources consulted by iulian@our website.
[1] Source: Economica.net, 2022.
- Evidently, the ambiguity in the price-capping mechanism's procedure for reimbursement of CO2 certificate costs has led major power producers, such as OMV Petrom, Romgaz, and CE Oltenia, to seek compensation for the difference between market prices and the capped end-user price for their energy.
- Amidst this situation, the finance industry plays a crucial role in determining the eventual reimbursement of these energy-related costs, as the total debt for both power producers and suppliers is estimated to reach approximately EUR 1 billion.
