ACUE disagrees with the legislative changes without analyzing all the effects on the energy market and, implicitly, the

The members of the Federation of Associations of Energy Utility Companies (ACUE) are surprised and also concerned about the National Energy Regulatory Authority (ANRE) decision to change again unexpectedly the secondary legislation during the regulatory period, without an appropriate prior consultation with the operators and without analyzing all the effects of the modification on the energy market.

2015-12-10 10:17:30

After only a year from the sudden reduction of the WACC (weighted average cost of capital) for the electricity distribution companies-which has a significant impact on operators, ANRE publicly and urgently debated a project of changing the methodology for setting the tariffs for electricity distribution service, approved by ANRE Order no.72/2013 as amended. Just like it happened with ANRE's order regarding the reduction of the WACC, this document was not publicly debated according to the legal deadlines and was not accompanied by an impact assessment.

According to the current rules, the distribution tariffs can vary annually, in real terms, by maximum 10 per cent for each of the specific distribution tariffs and by maximum 7 per cent for the weighted average tariff.

ANRE's order approved on Monday, the 7th of December, states that the limitation imposed on distribution tariffs annually variation refers only to the increasing of such charges. The regulator wants to remove from the legislation the limit of the tariffs reduction, after ANRE already announced it's intention to decrease the energy distribution tariffs with percentages between 5 and 16 per cent for the next year, but wants to maintain the limit of the tariffs' increase in order to protect the network users. In addition , these percentages publicly announced by ANRE were established in a non-transparent way without consulting the energy distribution operators, whose calculations differ from those of the regulator.

ACUE members strongly believe that such a sudden change in regulations will significantly affect energy distribution companies activity, as it happened when ANRE reduced the WACC, and a new decrease of the tariffs will have a significant impact on investment programs planned for the electricity network in the coming years. Taking into consideration the way it was promoted this legislative change, ACUE signals that ANRE has not complied with the principles of the "Better Regulation" program, adopted by the European Commission with the aim of having better regulation, by organizing efficient and concrete debates.

ACUE Federation demanded, in the recent years, a stable and predictable legal framework so that the energy sector can develop in a sustainable and balanced way. Also ACUE signaled ANRE some principles and recommendations on how to develop the regulations necessary for a functional energy market, the measure being determined by the unpredictability of the process of initiation of some pieces of legislation issued by ANRE , by the lack of prior analysis of their impact on the market, and the lack of substantiation notes and some real public consultations on specific draft regulations.

ACUE also transmitted to the regulator that it is necessary to improve the way it substantiates the draft legislation submitted to public debate, being compulsory to go through a preliminary stage for "impact analysis" of the draft legislation in which, applying the "evaluation before action" principle, ANRE should consider all the potential consequences generated by the implementation of it's normative acts.

ACUE argues that it is absolutely necessary for ANRE to publish such impact analyzes and to offer a reasonable amount of time for all the persons and entities concerned to consult thoroughly these published studies and to have the possibility to make their own evaluation in order to send relevant and useful proposals.

The completion of all legal obligations of transporting and distributing electricity involves uninterrupted and efficient services, which have to be at a higher level of quality, on the basis of justified costs of the operators. Also, the protection of the users of electricity networks , including the vulnerable consumers, can't be done through distribution tariffs .

Significant investments amounting to 9.7 billion lei have been made in the electricity transmission and distribution grids between 2008 and 2014. 1.9 billion lei were also invested in the natural gas distribution networks in the period 2008-2013, in order to maintain, expand and improve them.
In the last ten years, the gas and electricity companies that are members of the ACUE Federation invested in Romania about 8.7 billion Euro and made investments, for 2015 only, of about 600 million Euro, which proves their commitment to the Romanian energy sector, and implicitly, to the Romanian energy consumers.

Established in May 2012, ACUE Federation has about 25 members, among which many groups from the energy such as E.ON Romania, GDF SUEZ Energy Romania, Distrigaz Sud Retele, ENEL Romania, CEZ Romania, Electrica SA, C.N.T.E.E. TRANSELECTRICA, Electrica Furnizare, Congaz, WIEE, WIROM GAS, GAZ EST, with a total of about 30,000 employees and an annual turnover of over 5.4 billion Euro.