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Romania's Hidroelectrica ends contract for cheap electricity

19 Jul 2012 17:56:22 | edem

Romania's Hidroelectrica has reportedly discontinued its long-term electricity supply contracts with wholesale companies EFT Romania and EFT Switzerland, but renegotiated a deal with the country's Electromagnetica at a price higher than the one agreed on previously.

Hidroelectrica is thought to have terminated a 1TWh contract with EFT Romania and another 0.6TWh contract with EFT Switzerland for electricity exports from 1 August, sources told ICIS.

EFT, which sells electricity to nearly 70% of Romania's cement industry, concluded the deal with Hidroelectrica last year. The agreement was reportedly expected to run until 2017. At the same time, however, Hidroelectrica has reportedly renewed a 0.6TWh contract with Electromagnetica, a Romanian renewable generator and distribution company, until 2014.

The energy will be reportedly sold by Hidroelectrica at New Lei 198.00/MWh (€43.00/MWh), New Lei 50.00/MWh above the price that was negotiated by the counterparties last year.

The Day-ahead Baseload product out-turned at New Lei 203.98/MWh on the exchange OPCOM on Thursday.

Hidroelectrica, EFT and Electromagnetica could not make any comment before publication.

Last year, Hidroelectrica renewed a number of contracts for the delivery of energy at prices hovering around the New Lei 130.00/MWh mark, some New Lei 70.00/MWh below the OPCOM. However, it came under intense scrutiny from the press as well as the European Commission and the International Monetary Fund (IMF) after the state-owned hydro generator had to declare force majeure following a lengthy period of drought (see EDEM 27 September 2012) .

In a separate development Hidroelectrica said it had sold two lots of Peak electricity of 12440MWh each covering 1 August-31 December 2012.

The winners of the tender were SC Repower Furnizare Romania and SC CEZ Romania SRL. The former bought the energy at New Lei 255.77/MWh, while the latter paid New Lei 256.50/MWh. AS

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