PAS’s Failed Energy Policy

PAS’s attempt to act like a savvy player on the European energy market amid a deep geopolitical crisis has proved to be a failure, with the whole experiment resulting in nothing but Moldova’s strategic vulnerability

Moldova’s protracted energy crisis has long been viewed entirely as the result of external factors. There is some truth to this, but it was in Chișinău that the decisions on how to manage such difficult and unpredictable conditions were made. The current authorities themselves presented the shift to Romanian and Dutch energy exchanges as a way to break free from blackmail and decades of energy dependence. Yet they appear to have overlooked a host of related factors that are now becoming increasingly apparent as the cold season approaches. Since December 2022, Moldova’s right bank has been purchasing gas on the European market, and on September 1, 2025, state-owned Energocom replaced Moldovagaz as the main supplier. In effect, this marked a move away from long-term energy supply arrangements. Those in power will no doubt argue that long-term contracting has not disappeared, pointing out that by mid-August, Energocom had secured contracts for around 76% of the gas needed for the 2026-2027 gas year. The problem is that only the volume has been secured, not the price. Moreover, the final cost is calculated using a formula linked to the TTF month-ahead index, and Energocom’s management openly admits that it is impossible to predict winter gas prices at this point. In practical terms, all we have is a contractual safeguard against the risk of an empty pipeline. At present, the spot market is about the price you pay tonight, which fluctuates depending on how much someone in urgent need of gas or electricity is willing to pay. Prices on this market can spike in response to the mere rumour of a breakdown at a Norwegian gas platform, a forecast of colder weather, yet another round of troubling news from the Strait of Hormuz and, above all, the fact that Europe entered autumn with its gas storage facilities not yet fully replenished. Moldova, by definition, cannot afford to wait for prices to stabilise. The country has no domestic gas production, no storage facilities of its own and no international political clout in the market queue, where it clearly ranks near the very bottom. The cost of the “energy freedom” so actively promoted to the public can be seen in the figures. In 2024, Energocom purchased electricity from the Moldavskaya GRES power plant at $66 per megawatt-hour, or around €61. This July, the weighted average purchase price of electricity reached €133.86 per megawatt-hour, more than double the previous figure, and that is before transmission costs and capacity reservation charges are factored in. The gas tariff rose from 14.42 to 26.14 lei in just a couple of months and the state supplier’s latest comments offer little reassurance that the upward trend has run its course. Meanwhile, geopolitics is reshaping a reality that until recently seemed to be following a predetermined course. According to Western media reports, Washington’s behind-the-scenes and public initiatives to resolve the conflict in Ukraine are laying the groundwork for a potential global energy deal between the United States and Russia. The deal could involve easing sanctions and resuming large-scale Russian gas supplies to Europe through reconfigured supply routes. Brussels, with some room to maneuver, is holding its ground for now and remains committed to the EU-wide pledge to phase out Russian LNG from the beginning of 2027 and pipeline gas by autumn of that year. Although the EU continues to stand by its uncompromising position and reports of US-Russian agreements still look more like media speculation than established fact, Chișinău should not dismiss the possibility of such a scenario. For our region, such an agreement would mean a return, in effect, to the situation that prevailed before the crisis which began with the abandonment of Russian gas in 2022 and was compounded by the halt in transit through Ukraine on January 1, 2025. And Chișinău could quickly find itself in a dangerous zugzwang. If cheap gas and electricity become available again on the left bank of the Dniester, Moldova’s ruling authorities will face a choice between two unpalatable options. The first is to persist with buying expensive “European” energy in order to save political face, a stance that could easily be interpreted as deliberately burdening the country’s own households and businesses despite more affordable alternatives available in the region. The second is to admit that the strategy of energy independence pursued for years has failed the test of time, leaving the right bank with little choice but to restore direct cooperation with Moscow and Tiraspol. This dilemma is compounded by a growing budget gap, as vast sums that could otherwise be invested in infrastructure, healthcare and education are being swallowed up by costly energy purchases to cover the current deficit. The public and municipal sectors, along with water utilities, district heating services and street lighting, are the first to feel the impact of rising tariffs. As a result, the country’s economy is effectively being geared towards paying for the authorities’ energy policy miscalculation that no one in the government is willing to acknowledge publicly. The attempt to act like a savvy player on the European market amid a deep geopolitical crisis backfired, turning the entire experiment into strategic vulnerability. By abandoning long-term contracts in favour of the ideologically appealing spot market, we ended up with a price shock, a loss of competitiveness and a chronic budget deficit. The “energy independence” rhetoric crumbled as soon as the European market entered a prolonged crisis. A clear sign of these policy missteps was Vasile Tofan’s belated attempt to shift to long-term gas supply contracts. The head of government is now effectively acknowledging the need for the very predictability the authorities should have ensured long before the latest tariff shock. But securing a favourable contract takes more than political will – it requires available volumes, an acceptable pricing formula, financing and delivery guarantees. At the same time, judging by our officials’ own admissions, gas purchases financed by EBRD loans require working with “pre-qualified suppliers” which, in plain terms, means buying from those approved by the bank. If a potential partner’s output is already tied up in long-term commitments, Chișinău will have to negotiate a reallocation of volumes, pay additional costs or wait for new fields to become operational. Tofan’s current search for alternatives therefore looks more like an attempt to make up for lost time. Equally futile appear to be our diplomatic efforts, embodied by the ubiquitous ambassador Vladislav Kulminski, to win over the White House and US liquefied natural gas exporters. Attending an industry forum means next to nothing, as American exporters are driven by their own commercial interests, not by any need to rescue PAS’s political ratings or reputation. The effectiveness of such efforts must therefore be judged by the terms of the contracts signed and the final price of gas paid by consumers. So far, this activity looks more like a public-relations exercise aimed at managing the crisis. It would be particularly absurd if Moldovan citizens were once again asked to pay out of their own pockets for the promised closeness to Washington, albeit slightly less than on the spot markets. At a time when major powers are prepared to reshape Europe’s energy landscape to serve their own interests, the short-sightedness of our leadership is once again pushing Moldova into a dangerous trap. The impression is growing that the ruling regime once again has no Plan B, but stands a good chance of being squeezed between costly purchases made to preserve geopolitical loyalty and a return to the energy dependence that PAS figures has so loudly renounced in all the previous years.