This report covers the data released mainly during Q1’14 – and in the first months of Q2, mainly regading full-2013 data and preliminary Q1’14 data. Besides the statistics office’s data, we have collected and compiled statistics from Eurostat – who recently added JODI dataset among its official series, from the national energy market regulator ANRE and from the market operator OPCOM. Notably, JODI data were updated under Eurostat release and ANRE resumed releasing detailed monthly data on natural gas use.

The government is at the point where it plans to have updated the national long-term energy strategy. The previous version was drafted before the crisis and it became obsolete mainly because the energy consumption outlook changed dramatically. The gross energy consumption decreased by 9% y/y in 2013 and reached the lowest level in decades. There are indeed different trends among the energy sources – but generally the energy efficiency is going to increase as the energy price goes up. This was particularly visible in the natural gas sector, where Romania became nearly self-sufficient just by freeing the regulated price of the domestic gas. We are still far from having a functioning gas market, but the demand seems to be highly elastic to price as the inefficient use of gas in chemical industry plunged sharply recently as the prices increased.

The renewable energy sector also undergoes major regulatory changes. Romania’s President Traian Basescu endorsed the amendments to the renewable energy support scheme defined under the law 220/2008. The move aims to respond to the government’s claims that the electricity prices would otherwise rise dramatically. Romanian energy market regulator ANRE has decided that no overcompensation correction should be operated as of January 2015 under the renewable energy support system, since the investment and operation costs per MW of installed capacity are in line with the target profitability ratios of 10-12% (depending on technology used). ANRE has also set a renewable electricity mandatory quota of 11.1% for 2014, reducing it from 15% under the law 220/2010.

Key Points:
• Nuclear power critical for Romania’s energy strategy – draft govt document; coal to provide self-sufficiency while among green power – biomass should be encouraged.
• Hidroelectrica picks up Morgan Stanley and Raiffeisen to manage 15% IPO, but the company re-enters insolvency meanwhile
• Domestic intake of primary energy decreased by only 4.3% y/y to 29.5mn toe in 2013
• Crude oil refinery intake bottoms out after record low in 2012;