Eastern Europe has a higher electricity price on the DAM markets than Western Europe, amid the continuous increase in electricity demand in the eastern region, claims the president of the Smart Energy Association (AEI), Dumitru Chisăliță.

“Eastern Europe has a higher electricity price on the DAM markets than Western Europe. This is due to the continuous increase in electricity demand in the eastern region following the increase in electricity imports in Ukraine (due to the destruction of the electricity production infrastructure) and the Republic of Moldova (due to the reduction in the quantities of gas that reaches this country for electricity production). But this situation came with capacity bottlenecks in the grid in Central European countries (Austria, Slovakia, Hungary),” the president of the AEI said in an analysis, according to Agerpres.

According to the cited source, after the synchronization of Ukraine and the Republic of Moldova with the European grid (March 2022, in emergency mode), energy flows in the eastern region increased due to the fact that Ukraine and the Republic of Moldova started importing energy through Hungary, Slovakia and Romania.

The analysis mentions that these new flows in Eastern Europe increased the load on the east-west interconnection lines (Austria, Slovakia, Hungary a central node of the ENTSO-E network). At the same time, the new flows made redispatching more difficult (system operators had to limit the available transfers between certain areas for stability) and accentuated the price differences between Western Europe (where the network is dense and interconnected) and Eastern Europe (where there are network bottlenecks).

“Export restrictions in countries in the central area of ​​Europe or limited transfer capacity determined that the flow of cheaper energy from the “surplus” area to the more “deficit” area was restricted. This has reduced the possibility of prices in the eastern areas “equalizing” with those in the west. This is against the background of the increase in electricity demand due to imports from Moldova and Ukraine. This situation has created a protection of the increase in electricity prices in Western European countries and has led to an increase in prices in Eastern Europe. There is no public evidence or official investigations to indicate that Central European countries have intentionally introduced or maintained these limitations to favor Western countries, but this has led to an increase in electricity prices in Eastern Europe,” the document also states.

According to the research, the “huge” disparity in prices mainly in Bulgaria, Greece and Romania against the rest of the countries is based on a variety of factors, both “apparent and hidden”, such as climatic, geopolitical and structural (generation mix, networks, interconnections). In other words, the effect of blocking the flow of cheap energy from Western Europe to Eastern Europe is real, but the intention is not proven.

Thus, the blockage stems rather from the historical undersizing of the networks; delays in interconnection projects (including with Hungary and Slovenia); unplanned flows from Germany and the Czech Republic (“loop flows”) and the sudden increase in demand in the Southeast, including due to transit to Ukraine.

Analyzing the average prices in Eastern Europe and those in Western Europe, it can be seen that they are higher in the East.

According to the cited source, the former Minister of Energy, Sebastian Burduja, requested the European Union a compensation mechanism for the states in Eastern Europe, affected by network blockages and higher electricity prices.

“Romania argued that persistent price differences – even over 20% compared to the West – are generated by congestion in the transport infrastructure in Central Europe, not by the local market. The proposal, however, was followed by concrete actions at the European level only in December 2025, when Minister Ivan discussed the construction of the Austria – Romania Energy Highway. In the absence of a compensation mechanism, Romania continues to suffer the consequences of a fragmented market system, in which energy prices in the East remain significantly higher than in Western states,” the document also states.