By: The Quinnipiac University Economics Research Team, Jack Hangen
Romanian citizens and corporations have started to feel the squeeze from increased energy prices. Costs have skyrocketed across the nation and there are even some areas where prices have risen 4 to 5 times.
The Romanian government signed a law in October to cap the price of electricity. The law will be in force from November 2021 until to April 2022. In addition to capping the price of energy it also offers financial support to households that meet certain consumption criteria. Some suppliers had chosen to ignore the law, but the current energy minister will nevertheless aim to amend the law so to make sure the companies do not pay the penalties associated with not adjusting the bills. Instead, the government prefers that they re-issue corrected energy bills.
While most measures thus far have focused on the household consumer, the government is also looking to protect companies, especially the food and agriculture industry, from rapidly rising energy costs. Union and company representatives have stated that without some action taken by the government, some companies will be forced to declare bankruptcy.
Future actions to take on the energy crisis is a hot topic that has caused division within the government. Representatives have even gone as far as to call for the energy minister's resignation. The main debate is on whether the government should wait till April when the law will expire or take action and risk messing up the national budget. Romania has already taken action for now to ease the burden on consumers but may need to take additional action before the current law runs out.
This article is based upon: https://www.rri.ro/en_gb/debates_on_capping_energy_bill_prices-2652979