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November 28, 2021

Price of electricity drops just as much as the price of grains

Nuclearelectrica not finding buyers at the price of EUR 37/MWh

`With grain producers selling wheat and corn this year at the lowest prices registered in the last decade, it is now the electricity producers’ turn to complain of a drop in prices. However, in this sector the state of the European economy which is not recovering from the financial and economic crisis is “to blame.”
Daniela Lulache, Director General of Nuclearelectrica, the company that produces 20 per cent of Romania’s electricity, believes that the price of energy will continue to drop next year too and states that the “scary part” is the consumers’ lack of appetite for long-term contracts. The Romanian electricity producer is trying to sell on the long-term bilateral contracts’ platform of OPCOM, the energy stock exchange, 29 packages of electricity worth a total of EUR 42 M. The starting price in these tenders is RON 165.5 (EUR 37.4) per MWh, a price that includes the tax of introduction within the distribution network. However, none of the electricity packages was sold yesterday, October 21.
Overall, Nuclearelectrica is trying to sell through these tenders 10 per cent of the company’s annual production, some contracts being one-year contracts, and others covering the first four months of 2015.The price that the state-owned producer is asking for – EUR 37 per MWh – is low considering that in 2008 electricity was sold for almost EUR 50 in bilateral contracts.
For a company with a production profile like that of the Cernavoda nuclear power plant, which has an almost constant production and which needs banded electricity consumers, the signing of long-term contracts is very important, the spot market being basically inaccessible for Nuclearelectrica.
After the first nine months of the year the average price in bilateral electricity contracts was of EUR 37.2 per MWh, down by 13 per cent compared to the same period last year. On the spot market the average price was EUR 32 after the first nine months, down by 6 per cent compared to the same period last year.

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