Nicolescu: GEO 114 will either bring price increases or profit cuts for state-owned companies

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Government Emergency Ordinance 114/2018 could have a very negative impact on the energy sector if it is not quickly changed or abrogated, says Razvan Nicolescu, Energy & Resources Industry Leader, Deloitte Central Europe.

“I would like this to happen and start seriously discussing the major challenges facing the energy sector, such as the lack of new production capacities for both electricity and natural gas, decarbonisation of the sector, integration of renewable energies or domain digitalization. If the normative act remains in its current form, prices will increase both short and long term or increases will be mitigated by state-owned companies, especially Hidroelectrica and Romgaz,” Nicolescu said in an interview with financialintelligence.ro.

“From the point of view of Brussels, Government Emergency Ordinance 114/2018 shows a lack of trust in the National Authority for Energy Regulation (ANRE), that is to say, in the capacity of ANRE to fulfill its main task of ensuring the functioning and monitoring of the energy and adopting a fair market model.”

A second perspecitve ”concerns the lack of compliance between several provisions of GEO 114/2018, on the one hand, and the Treaty of the European Union and competition law, on the other. In fact, as we anticipated, the European Commission has already reacted on the natural gas side.”

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