Rotalin Gaz Stops Gas Supplies: ANRE Issues an Appeal

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Rotalin Gaz Trading announced its inability to supply gas at the new regulated prices. The company is also likely to be forced to leave the gas supply market in Moldova due to the decisions of the National Energy Regulatory Agency. At the same time, Rotalin Gaz said it was ready to supply gas at unregulated tariffs, even lower than Moldovagaz’s tariffs, reports. The company explained that on 5 September ANRE had set tariffs for Rotalin Gaz Trading that did not reflect costs, were unfair and put it in an unsustainable position. “This means that Rotalin Gaz Trading is forced to supply gas without receiving the revenue needed for distribution services. Forcing a gas distribution company to operate with insufficient revenue is dangerous and illegal, and the company has no right to jeopardize the safety of the distribution network and the delivery of gas to about 21,000 customers. Thus, we declare that as of 1 October 2023 we will not be able to fulfil our obligations to provide services to the population and supply gas to our consumers at the new regulated price,” the company said in a press release. By law, as of 1 October, ANRE must appoint Moldovagaz as the supplier of last resort for existing Rotalin Gaz customers who currently receive gas at regulated prices. Rotalin Gaz explained that the new tariff is significantly lower than the current market price for natural gas. “ANRE groundlessly claims that Rotalin Gaz made “excessive profits” in the first half of 2023, when the company switched from purchasing gas from Moldovagaz to direct imports from the EU. This move successfully broke the old import monopoly held by Moldovagaz. Thanks to our transparency in gas procurement, the cost of gas purchases has been constantly reduced compared to the prices offered by Moldovagaz. Most of these savings were used to repay debts to Moldovagaz and to compensate for losses incurred due to inadequate ANRE regulation. Only in 2022, mostly due to such regulations, the company’s losses amounted to 47 million lei, while the negative deviations of distribution tariffs accumulated in 2023 have already reached 20 million lei,” Rotalin Gaz cites as an example. The company pointed to the fact that Moldovagaz tariff deviations were included in the tariff, while the historical negative deviations of Rotalin Gaz were rejected by ANRE. As a result, the tariff set for Rotalin was 35% lower than for Moldovagaz, despite the latter’s significant advantages in size, international and state support and favorable supplies from Energocom. Rotalin Gaz asked the Commission for Emergency Situations to intervene and oblige Energocom, the company authorized to ensure the purchase of natural gas for vulnerable Moldovan consumers with international funds, to sell us gas under conditions similar to those offered by Moldovagaz. “This request has remained unanswered, Energocom continues to supply gas exclusively to Moldovagaz, showing clear bias and discrimination against private suppliers such as Rotalin,” the company emphasized. It noted that in 2018, ANRE imposed an obligation on private suppliers to supply gas at regulated prices to consumers, but did not provide any means to ensure the fulfilment of this obligation and a mechanism to compensate for losses. Besides, the regulator does not allow such a supplier to avoid fulfilling this obligation. “ANRE’s actions undermine free market principles and go against the international commitments undertaken by the Republic of Moldova to develop a competitive and transparent natural gas market. Such ill-conceived regulation has already forced most independent gas suppliers out of the Moldovan gas market since 2016. This created conditions for almost complete monopolization of the market by Moldovagaz, depriving consumers of access to alternative suppliers with lower gas prices and high quality of services,” the company added. Rotalin Gaz assured that it would be able to supply gas at more affordable unregulated prices than Moldovagaz can afford today and would soon present concrete proposals to consumers, both existing and potential. On 5 September, ANRE set the tariff for household consumers of Rotalin Gaz Trading at 10.84 lei per cubic meter of natural gas. This is one third less than their current tariff. ANRE’s management did not take into account the company’s claim that supplying gas at such a tariff would lead to its bankruptcy, and refused Rotalin Gaz Trading’s request to withdraw from the public gas supply service. Director Violina Șpac accused the company of blocking ANRE’s work for its own financial interests. Against the background of the press release issued by Rotalin Gaz Trading and other appeals to various institutions, the National Energy Regulatory Agency (ANRE) issued an appeal. On 10 July 2023, ANRE received a formal request from the license holder to verify and approve the regulated prices for the supply of natural gas, as well as the adjustment of tariffs for natural gas distribution services. Both the holder’s requests and the results of these requests were published on ANRE’s website for public discussion. Later, on 5 September 2023, the Agency approved the regulated natural gas supply prices and distribution service tariffs of Rotalin Gaz Trading for 2023.