Bucharest Mayor warns that heat energy price could uncontrolledly rise

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Bucharest General Mayor Sorin Oprescu on Thursday warned that heat energy prices could exaggeratedly rise as of autumn and the city hall won’t be able to pay the subsidies for the Capital’s citizens if the Government did not pass the Bucharest steam power plant ELCEN in the City Hall’s administration.

“We are talking about an extremely serious issue and I want to seriously warn that the situation cannot be delayed and tolerated,” Oprescu said.

The Bucharest Mayor warned that if the debts that RADET (The Autonomous Body for Heat Energy Distribution) has to ELCEN are not solved, over 1.2 million persons living in 570,000 apartments in Bucharest could run out of heat during the winter season.

Oprescu argued that, due to RADET penalties that must be paid to ELCEN, all the money that RADET gets from the City Hall are go directly in the company’s accounts, while the actual debt is never decreasing and there is no money left for investments. At the same time, old equipment make losses bigger and they are paid by the Bucharest inhabitants.

The Bucharest Mayor considers the situation could improve of the ELCEN Bucharest Electrocentrale would go from the Energy Ministry to the Bucharest City Hall. According to him, ELCEN is holding 90 percent of the energy production market in Bucharest at present.

In his turn, RADET president also warned over the fact that Bucharesters could run out of heat and hot water because the heating system is old, while half of the revamping works haven’t begun yet. Gabriel Dumitrascu said that inhabitants in northeastern Bucharest could be mostly affected by the lack of rehabilitation works. He also unveiled there are suspicions that ELCEN is practising heat and energy crossed subsidy, and for that reason RADET will ask in court the suspension of all outstanding payments to ELCEN. “You cannot take over costs from the electricity sector and transfer them in the area of the heat energy, as there was this temptation to make the megawatt competitive on the electricity’s competition market,” RADET president explained.

RADET-ELCEN merger was approved by the Bucharest City Council in October last year. The Autonomous Thermal Energy Distribution Bucharest (RADET) is subordinated to the mayor’s office, and Elcen – Electrocentrale Bucharest, the heat supplier for RADET, belongs to the Ministry of Economy, through the Department of Energy.

The project aims to respond to the call of the Romanian government to issue a law on the transfer of the shares from of Electrocentrale Bucharest SA from the state’s private property to private ownership by Bucharest, under the provisions of the Memorandum approved in the cabinet meeting on 27 March 2013 with the subject ’Realizing the public service of supplying heat through a centralized supply system (SACET) in Bucharest and Constan?a”. Local media said back then that the Government was to provide  RON 100 million to the City Hall, money that will be transferred to Elcen for giving RADET the necessary energy to distribute hot water and heat to households.

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