The new gas market regulation system proposed by the government no longer establishes a maximum ceiling on the final price for households, but introduces regulated costs along the entire supply chain, specifically on the purchase and supply side. Thus, on the bill, the consumer will see the lowest price between the one established by the supply contract and the price resulting from the sum of the regulated costs along the supply chain, says Daniela Dărăban, Executive Director of the ACUE Federation (Federation of Energy Utilities Associations). “International wholesale gas markets remain sensitive to the geopolitical context, and the capping mechanism, with a series of adjustments, has been extended until April 2027 for household consumers,” says Daniela Dărăban. Romania needs concrete measures to increase liquidity on wholesale gas markets, an essential element for the formation of competitive prices and for the stability of the energy sector. At the same time, the targeted protection mechanism for vulnerable consumers must be strengthened and improved, says Daniela Dărăban, in an exclusive interview with Energynomics. And in order to attract new investments, “Romania does not have to invent solutions. It is essential to reduce the tax burden, in line with European recommendations, to eliminate the unpredictability of decisions and the regulatory framework, and to adopt policies to encourage investments in accordance with European Union standards,” argues the ACUE director.
What would have been the best scenario for the re-liberalization of the gas market, in the opinion of ACUE?
For the energy sector, successive regulations and unpredictable legislation represent some of the greatest risks and constitute an obstacle to its development.
The correct role of the state in a free energy market is not to set prices or substitute competition, but to create the framework in which the market can function efficiently, predictably and fairly, through clear, stable and transparent rules. Any one-off intervention in an exceptional context of crisis must be legitimate, justified, proportionate and limited in time.
The first rule of public policy is to substantiate the intervention. The generalised capping of gas prices was justified by the sharp increase in prices on wholesale markets in the period 2021–2022, in an exceptional context marked by volatility and uncertainty. For example, on the European reference market TTF, the gas price increased from around €20/MWh at the beginning of 2021 to over €180/MWh at the end of the same year, and in August 2022 it exceeded €300/MWh, against the backdrop of geopolitical tensions and the reduction of gas supplies to Europe.
In these circumstances, the introduction of a consumer protection scheme was legitimate. Ideally, however, such intervention should have been targeted at vulnerable consumers or truly exposed sectors, but a general capping was chosen.
As the market recovered, it was natural that the intervention mechanism should also be gradually withdrawn. The cap established was a maximum one, and in the last two years suppliers have invoiced gas to the population and economic agents at or even below these caps, depending on market conditions. This convergence between market prices and the maximum cap represents a solid argument for eliminating the capping scheme.
However, international wholesale gas markets remain sensitive to the geopolitical context, and the capping mechanism, with a series of adjustments, has been extended until April 2027 for household consumers.
What is missing, however, are the necessary measures to strengthen the functioning of the market. In particular, concrete measures are needed to increase liquidity in wholesale gas markets, which is essential for competitive pricing and stability in the energy sector. Liquid markets remain essential for achieving fair prices and the stability that both industry and household consumers need.
At the same time, the transition year must not be wasted. In parallel, until the elimination of the household scheme in April 2027, the targeted protection mechanism for vulnerable consumers must be strengthened and improved. An important step was taken last year by creating the EPIDS platform for granting electricity vouchers, a system that can be adapted, improved and streamlined to also support vulnerable gas consumers.
Moreover, in the medium and long term, a committed strategy for residential heating solutions is needed. Romania must gradually reduce its dependence on wood heating and promote more efficient and less polluting alternatives.
What will this price model administered by the authorities mean for the market, prices and players?
We are talking about approximately 35% of national gas consumption, represented by household consumption, which is however strongly concentrated in the cold season – approximately 80% of annual household consumption takes place in winter. The new support measures aim to ensure stability, predictability and protection for the population, especially in the next cold season.
The new proposed system no longer establishes a maximum ceiling on the final price for households, but introduces regulated costs throughout the supply chain, specifically on the purchase and supply side. Thus, on the bill the consumer will see the lowest price between the one established by the supply contract and the price resulting from the sum of the regulated costs on the supply chain.
According to current estimates, household consumption should also be ensured next winter at a price level close to that of the 2025-2026 cold season. This is possible because the mechanism allows for the planning of the necessary quantities in advance, including for storage.
At the same time, the supply segment remains the most competitive, and consumers still have the opportunity to choose the offer that suits them best. Both household and non-household consumers are encouraged to periodically inform themselves about the offers available in the market and to choose the option that best suits their needs.
How can we have better liquidity, representation and transparency on the gas market? How can a gas release program help solve the market problem? How has it worked in the past?
In order for prices to be formed correctly, the Romanian gas market needs, first of all, increased liquidity. We are talking about the existence of a sufficient number of sales offers for different exchange products and for different gas delivery periods. Also, daily transactions, including for medium and long-term products, must be sufficient to generate robust and credible price benchmarks for market participants.
A gas release program has also operated in the past as an obligation for producers to sell a certain percentage of their production on centralized markets. With the introduction of price capping measures, this obligation was removed from the legislation. In contrast, the obligation for suppliers to purchase from centralized markets, in the long term, at least 50% of the consumption needs of the customers in their portfolio was maintained.
In large European hubs, such as TTF, the volume of transactions is dozens of times higher than physical consumption, which ensures liquidity and solid price benchmarks. In Romania, liquidity is still limited, with a ratio between traded volume and physical gas consumption close to 1 or even below this level. This shows that the market needs more transactions and larger quantities available for sale to generate robust and credible price signals.
For this reason, we proposed the reintroduction of a gas release mechanism, which would ensure predictability of the quantities available for sale in the market. Such an instrument has proven beneficial for the market, contributing to increased liquidity and price stability.
Is the recent measure taken by the government to protect vulnerable consumers sufficient? What else should be done?
Social policies should not be achieved through price controls or administrative interventions in the market. Such measures limit investments in both production and distribution and can generate, over time, a boomerang effect. Without sufficient investment in the energy sector, sustainable energy prices cannot be achieved.
The state took a step in the right direction last year by providing direct support to vulnerable energy consumers. Our expectation is that, in the coming period, a direct support mechanism for the gas consumption of vulnerable consumers will be established as quickly as possible, especially for the upcoming cold season.
The free market is often perceived as a risk, but in reality it represents the guarantee of competition and competitive offers. The experience of exiting the cap on the electricity market shows that offers have diversified and that more and more consumers are actively looking for advantageous options, taking a more active role in managing energy costs.
However, the responsibility of the Romanian Government does not stop at adopting support programs. It is equally important that these programs work efficiently in practice, through simple procedures, clear information for consumers and automatic support mechanisms, where possible.
What should Romania change in its tax regime to attract more direct investment and reduce pressure from investors?
Romania does not need to invent new solutions. It is essential to reduce the tax burden, in line with European recommendations, eliminate the unpredictability of decisions and the regulatory framework, and adopt investment-encouraging policies in line with European Union standards.
Currently, the energy sector is faced with a high level of taxation and a series of additional taxes that affect the predictability of investments. For example, we have the well-known “pole tax”, which is in reality a tax applied to investments in energy infrastructure, even though it is to be eliminated starting next year. To this are added several additional taxes applied to the production segment, such as the tax on additional income obtained from the sale of natural gas, a tax specific to gas producers, paid in addition to the profit tax and royalties.
At the same time, on the final price side for consumers, the VAT was increased instead of reduced, as other European countries have done.
In this context, it is important to decide whether to treat the energy sector as an additional source of budget revenue or whether to let it develop to support the investments necessary for a modern and competitive energy system. We believe that additional windfall taxation can be justified in exceptional situations, but only within a fair, transparent and temporary mechanism that justifies such an intervention.
Economic and budgetary recovery cannot take place without measures that encourage investment in the energy sector. As an example for the distribution sector, a study shows that attracting additional investment in distribution networks, through a stimulating regulatory framework adapted to the needs of the energy transition, could generate an annual positive economic impact of approximately 3.3% of GDP. In the absence of concrete incentives for investments in distribution networks, Romania risks losing an annual economic growth opportunity of up to 10.6 billion euros.
The energy sector is a critical sector for economic competitiveness, but also for the added value it generates in the economy through its horizontal effects. Therefore, it must be treated responsibly and with a long-term vision, avoiding additional tax measures motivated exclusively by the need to increase budget revenues in the short term. The medium and long-term impact may be undesirable, by discouraging investments that the Romanian economy needs.
What is the current level and what would be the optimal level of investments in networks (and RRR) for the current Regulatory period 2025-29? What would be the ways and conditions through which investments in networks could be better stimulated?
The debate about how well the regulatory framework is adapted to the needs of the energy transition is not only related to the level of the regulated rate of return (RRR), which was set in 2024 at 6.94%, below the interest rate at which the state borrows. In reality, the discussion is broader and concerns the way in which the regulatory philosophy is built.
Given that Romania needs to reach a level of approximately 1.2 billion euros in annual investments in distribution networks, compared to approximately 500 million euros annually at present, it is essential to ensure that we can attract these investments. It is natural for investors to orient their capital according to the profitability and predictability of the investment, and the regulatory framework must reflect this reality.
We are going through a paradigm shift in the energy sector, and the regulatory philosophy must evolve with this transformation. Without adjustments in the way the regulatory framework is constructed, the targets assumed by the National Integrated Energy and Climate Change Plan remain difficult to achieve.
Investments in networks should not be seen as simple passive costs, but as facilitators of economic competitiveness and energy transition. The investment pace determines how quickly the energy transition can take place and how quickly Romania can capitalize on the economic opportunities generated by it.
There can be no energy transition without modern and extensive networks. In this sense, the Grids Package launched by the European Commission marks an important change in approach: from reactive network planning we must move to anticipatory planning, based on scenarios for the development of the energy system.
However, the current national methodology only allows investments when there is a firm demand for connection, and the risk of anticipatory investments not being recognised in tariffs discourages proactive network development. At the same time, the new European framework emphasizes flexibility, digitalisation and cybersecurity, elements that need to be better integrated into regulation. According to European estimates, the need for flexibility in the energy system will need to double by 2030 and increase by about seven times by 2050.
Moreover, the rapid development of new technologies – such as energy storage, demand response, electric vehicles or smart applications – as well as the digitalisation of the energy system are expanding the responsibilities of network operators and significantly increasing the complexity of their work.
Member States must create the necessary regulatory framework to enable and incentivise distribution network operators to purchase flexibility services, including for managing network congestion and for increasing efficiency in the operation and development of infrastructure. In this context, network operators need to invest in the development of new market platforms, such as flexibility services markets, which requires investments in hardware and software, data acquisition and analysis systems, as well as in staff training.
These responsibilities result from legal obligations imposed at European level, which is why it is important that the regulatory framework recognises the cost-effectiveness associated with these new tasks. For example, network operators should be able to recover the costs associated with the development of the digital infrastructure needed to manage flexibility services, in line with good regulatory practice.
The European Commission also recommends a structural change in the way regulated tariffs are set, so that they reflect the real way in which users use the network. The traditional model, based almost exclusively on the volume of energy consumed, no longer reflects the reality of an energy system with distributed generation and variable consumption. In this regard, the introduction of binomial tariffs is recommended.
The binomial tariff differentiates the costs associated with actual consumption from those related to the network capacity made available and does not bring additional income to distribution operators. Consumers thus pay a variable component, depending on the energy used, but also a fixed component, determined by the capacity reserved in the network. This type of tariff allows for a more fair allocation of costs, reduces the socialization of infrastructure maintenance expenses and encourages behavior that reduces pressure on the system.
Eurelectric’s latest report emphasizes that the modernization and expansion of networks is an essential condition for a secure, flexible energy system capable of providing energy at affordable prices. The organization’s analyses show that, in periods when the share of renewable energy exceeded 50% in the energy mix, prices were on average approximately 27% lower.
In other words, more clean energy means more affordable prices – if the network allows its transport and consumption when it is available.
How are we doing in terms of digitalization in energy? What needs to be done?
Digitalization is becoming an essential condition for the expansion of renewable energy to translate into real benefits for consumers. Green energy has gained ground rapidly, but without effective digital integration into the grid, it cannot fully contribute to reducing costs and stabilizing the energy system.
The current energy infrastructure was designed in a time when energy flows were predictable and unidirectional. Today, the energy system is becoming increasingly complex, with distributed generation, prosumers and bidirectional energy flows. In this context, connectivity to IT systems and real-time operation bring both opportunities and new risks, including from a cybersecurity perspective. In other words, every kilowatt must be managed and protected digitally as rigorously as it is physically managed in the grid.
According to estimates by the International Energy Agency, the share of investments in digital technologies for networks is expected to reach around 19% of total investments in networks, with an increasing concentration on the distribution segment, which represents over 75% of digital spending.
In turn, Eurelectric estimates that around 170 billion euros will be needed for digitalization, out of a total of around 400 billion euros of investments in European distribution networks in the period 2020–2030.
The European Commission also estimates that around €584 billion is needed to develop electricity networks this decade, with a large part of this investment going towards digitalising distribution networks. The aim is to make them real-time monitored, remotely controlled and cyber-protected.
A digitalised energy system essentially involves a few key elements: easy and secure access to relevant data for industry players; standardised and interoperable data across the sector; appropriate infrastructure, technologies and skills to operate digital systems; and a clear regulatory framework that defines roles, responsibilities, costs and benefits.
Digitalisation is the key enabler of this transformation, as it enables real-time metering, the integration of distributed generation and the management of flexibility in the energy system.
Without this modernisation, the energy transition risks being more costly and less efficient, and the benefits of renewable energy investments may not be fully reflected in consumers’ bills. The digitalization of networks thus becomes a fundamental condition for a more secure, more flexible and more accessible energy system for consumers.
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The interview first appeared in the printed edition of Energynomics Magazine in late March 2026.
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