Electricity and gas market prices are collapsing amid warming weather, renewable resources available, underground gas stocks and industrial consumption among the lowest in history.
At the Romanian Commodities Exchange, the gas quotation dropped below 100 lei/MWh. A week ago, it was 130 lei. What happened in the meantime? Thermal power has stopped in almost the whole country, people have turned off their wall power plants and the industry is still not consuming.
The largest individual consumer, which is the chemical industry, no longer exists, with the exception of the Azomureș factory, which is also not operating at 100% capacity. Moreover, we came out of the winter with the warehouses still half full, i.e. more than 1.5 billion cubic meters, according to the data provided by the Ministry of Energy. An abundance of gas in the market and a lack of consumption causes prices to collapse, according to the most basic economic rules.
The same trend can be observed in electricity. The price of gas has fallen three times since the winter until now, now being at an average of 35 euros. However, for several days we have been seeing 0 energy prices and even negative prices, where the producer pays a customer only to consume the electricity produced, things that have not been seen before in our country. Now, however, we have several factors at one place: high input of photovoltaic and wind energy (automatically taken into the system) and hydro, low internal consumption (mainly industrial), so the price of electricity is going down.
Normally, with prices on a constant downward trend energy would feed industrial consumption. However, we see that this is still to be expected. At this moment, the surplus of produced energy, especially the electrical one, is exported. This is where wind and photovoltaic energy producers excel, which are the cheapest, being subsidized by all of us through the “green” certificate system. There is no consumption in our country, the energy goes across the border where there is consumption, in this case to Hungarians, Bulgarians, occasionally also in Ukraine, because the Ukrainians need electricity, their energy system being under pressure due to the Russian bombings.
Tags: price energy collapsed Unprecedented situation Romania manufacturer pays customer
