Moldova plans to change the gas price formation Methodology to adapt the regulatory framework to the atypical situation in the gas market - ANRE.
The National Energy Regulatory Agency (ANRE) announced, noting that the energy regulator is aware that Moldovagaz may face a shortage of funds for gas purchase, which may jeopardize the possibility to pay for the imported natural gas during certain short-term periods. ANRE provided some explanations and clarifications regarding the mechanism of natural gas price setting and correctness. ANRE reminded that under the provisions of the Law on Natural Gas, the energy regulator approves regulated prices for natural gas supply to end users, in accordance with the methodology for calculation, approval and application of regulated prices for natural gas supply, approved by the ANRE Board on August 13, 2021. According to the Law on Natural Gas, regulated prices and tariffs for natural gas are set annually by the gas companies, in accordance with the methodologies of calculation, approval and application of regulated prices and tariffs, agreed upon by the gas companies. At the same time, the tariff methodology provides for the calculation of regulated delivery prices on the basis of total annual costs. Thus, the cost of natural gas, reflected in ANRE calculation, is determined in strict accordance with the requirements of clauses 6 and 7 of the Methodology, which explicitly reflect the costs of natural gas purchase for the year, but not for quarters or calendar months. "If Moldovagaz considers it expedient to approve regulated prices based on short-term fluctuations of natural gas purchase prices, the primary legislative framework, especially the Law on Natural Gas, must be changed," ANRE stated, noting that the reflection of the average annual weighted price of natural gas in the regulated price for natural gas supply allows leveling out significant price fluctuations and at the same time reflects the total annual cost of energy resources purchased by the supplier, ensuring its financial sustainability. "In any case, a qualitative forecast from the beginning of the management year of the average annual natural gas purchase price is important. In the structure of regulated prices for natural gas approved in 2022, ANRE took full account each time of the forecast values of the average annual purchase price requested and submitted by Moldovagaz", the energy regulator noted. At the same time, we would like to mention that the appeal of Moldovagaz to the National Agency for Energy Regulation, which served as grounds for the revision of the regulated prices on August 4, contained in the calculation of the regulated price some cost segments which are not reflected in the tariff methodology, in this case deviations were formed in 2022. As noted, in accordance with the provisions of paragraph 6 of the Tariff Methodology, the adjusting component of regulated income is the value obtained as a result of the difference between the refined regulated income for the previous year and the actual one registered in the same period. Therefore, deviations that occurred in 2022 cannot be considered and included in the regulated prices for 2022. “However, given the provisions of the contract with Gazprom and significant fluctuations in the purchase price of natural gas with a sharp upward trend (an atypical and unprecedented situation on the natural gas market), ANRE is aware that Moldovagaz may face a shortage of funds for the purchase of natural gas, which may jeopardize the ability to pay for imported natural gas for certain short periods. In this regard, we suggest that the supplier participate more actively in the working group established on the ANRE plarform to develop amendments to the Regulated Price Formation Methodology in order to adapt the regulatory framework to the atypical situation on the natural gas market. In accordance with the legal procedures established for amending regulations, public debates are not held unilaterally in the online environment and the media,” ANRE said in a statement. // 18.08.2022- InfoMarket.
