The prices on Romania’s wholesale electricity market will rise above those in Hungary over the next decade, reversing a trend that has existed since 2014, when the spot markets of Romania, Hungary, Slovakia and the Czech Republic were coupled, according to a forecast by global consulting company ICIS, local Economica.net reported.

The average price in Romania will be higher than that in Hungary by EUR 8 per MWh in 2024, and the difference will narrow again but no sooner than the end of the following decade (2021-2030).

The grounds for this forecast are, partly, the fundamentals of the Romanian market, hurt by a decrease in the thermal generation capacities amid high cost of the emission certificates, in the context of rising demand. On the Hungarian side, more competitive energy sources are expected.

Romania’s thermal generation capacities will decrease rapidly toward the middle of the next decade, due to the high emissions costs and the capacities approaching the end of their lifetime. ICIS forecasts a 60% drop in installed capacity in coal-fired power stations and 45% in gas plants in Romania. Renewable generation capacities will develop slowly, given that the Government has set a low target.

Meanwhile, the demand for electricity will increase by 1% per year, based on the power grid operator’s estimates. The gap between production and consumption, which currently does not exist, will thus reach 6 TWh in 2024, which is some 10% of current annual consumption.

editor@romania-insider.com

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