Romania is considering a voluntary common buyer for electricity consumed or lost in transmission and distribution networks, with procurement covering up to 70% of participating operators’ needs. The Energy Ministry opened an emergency draft ordinance for consultation on November 4; eligible costs could be recognised in regulated network charges under conditions set by ANRE, Romania’s energy regulator.
Voluntary procurement arrangement
The proposal would allow Transelectrica, Romania’s transmission system operator, and electricity distribution companies to appoint a shared buyer. It does not require operators to pool all their purchases, and the draft does not identify any company that has agreed to participate.
The buyer could procure electricity on wholesale markets, including through directly negotiated, longer-term bilateral contracts. The arrangement would apply to technical network consumption and losses, not necessarily to all electricity purchases by participating operators.
Electricity used to operate substations and power lost as it moves through wires are unavoidable network costs. Their price can fluctuate with wholesale markets, while the quantity depends on demand patterns, network topology and technical performance. Procurement therefore affects both market trading and utilities’ regulated revenue.
Romania’s main licensed distribution groups include Distributie Energie Electrica Romania, Retele Electrice Romania, Distributie Energie Oltenia and Delgaz Grid. Pooling separate demand portfolios could create larger contracts, strengthen negotiating leverage and make purchasing schedules more predictable.
Scale alone would not guarantee lower costs. Commercial outcomes would depend on price indexing, contract duration, portfolio shape, collateral and the ability to adjust purchases when actual losses differ from forecasts.
A common buyer could offer generators and wholesale suppliers larger offtake opportunities, while concentrating purchasing decisions among fewer counterparties. Operators buying most loss energy on short-term markets are exposed to price surges; longer-term purchases can smooth procurement prices.
Longer-term contracts also carry risks. Operators could incur losses if contracted electricity is more expensive than spot-market power, or become over-hedged if grid losses fall after efficiency investment.
Tariff rules and implementation
The draft envisages operating procedures being prepared by May 31, 2027 and submitted to ANRE for review. Subsequent tariff rules will determine which procurement costs are recoverable, whether incentives to reduce network losses remain intact, and who bears the consequences of purchasing errors or counterparty defaults.
Lenders and shareholders will seek clarity on cost recovery, efficiency incentives and responsibility for procurement errors or counterparty defaults. Those rules will shape how the shared purchasing arrangement affects utilities’ regulated revenues.
Transmission and distribution operators in Serbia, Montenegro and other Western Balkan markets face related questions over buying electricity for technical losses. Romania’s proposal could offer a regional model, but adoption elsewhere would require separate regulatory decisions.
The proposal’s value will depend on whether collective procurement improves hedging and tariff predictability without weakening competition or incentives to reduce network losses.
