CEZ ROMANIA S.A.

 | 

MARTIN ZMELIK

  |  20.11.2015

Energy market seen through the eyes of CEZ Romania

An excellent year is that when the market evolves within the anticipated parameters and the legal framework remains stable.

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CEZ ROMANIA S.A.

MARTIN ZMELIK

MARTIN ZMELIK

COUNTRY MANAGER & PRESIDENT OF THE BOARD at CEZ ROMANIA S.A.

1. How would you describe the Romanian energy market in 2014-2015? What are the prospects for 2016?


Given the difficult external context created by the legislative changes in the renewables generation sector, 2014 was a year of market preparation for more changes in the regulation sector, a challenging year for energy companies. The year 2015 brought some stability in the sector from a legislative point of view and we trust that 2016 will bring significant improvements of the legal framework that will allow companies to better predict and develop their activity on the market.

 

2. What is the link between the amount of energy produced and the economic growth? Is it still valid for Romania that ‘if energy consumption increases, the economy is growing’ and vice-versa?


Broadly, we can say that the saying is still valid especially if we take into consideration the levels of energy. Starting 2007 we can see a major decrease of the energy distributed on the high voltage and medium voltage levels that refers to the great consumers in the chemical and petro-chemical industry, cement production, car production, etc. We can presume that in these areas there is also a greater concern for energy efficiency measures, but mostly the activity decrease and even insolvency or bankruptcy are the main causes of the consumption decrease. In this conditions though, on the low voltage level, dedicated to small business clients, as well, an increase trend was registered.

 

3. How was the competition in 2014-2015 in your market? What are the prospects for 2016?


The competition had an uprising trend both on the engross market and retail market. In the energy production area there was an overcapacity, fact that created a pressure on the prices. Meanwhile, in the green certificates area, an oversaturation of the market was reached and the prices dropped to the legal minimum, being almost impossible, because of the legal regulations, for the market to absorb all the produced certificates.


Regarding the sale of energy, we can state that the final consumers represent the most competitive market: at auctions or requests of offer analysis organized by consumers, there are usually over 10 offers from suppliers.


The liberalization of the market has come to an end for non-household customers and in this moment, for the household ones, 50% of the energy is bought on the competitive market.


In 2016 the degree of liberalization for household customers will increase to 60% starting January 1st and to 70% starting July 1st.


For us, the main challenge is the aim to increase the market quota both in terms of electric energy and natural gas.

 

We believe that the market in Romania has a significant potential to evolve and, according to our estimates, the market will become more and more an energy services market that also include energy supply. Moreover, we trust that the lowest prices will turn to fair prices and the competition will give up the area of speculation of the imperfections of the engross market to the operational efficiency increase in order to serve clients at their best with costs as low as there can be.

 

Being on the Romanian market for 10 years now, CEZ is a strong supplier with an international experience that aimed, from the beginning, to develop a long-term business considering, of course, the local environment. A CEZ client is an entity that chooses a long-term partner with experience in ensuring modern and qualitative services, that identifies solutions to clients’ needs and that is there for the client all the time.

 

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