Thursday, December 9

Moldova decrees a state of emergency due to lack of gas




The Republic of Moldova, which borders Romania and Ukraine, expects the coldest winter in many years. Not because of the low temperatures, whose traditional average is four degrees below zero, but because this year it will not have enough natural gas to keep the heaters on. The reason is the difficult contractual negotiations with the Russian energy company Gazprom. Parliament has decreed a state of emergency that will allow the government to manage reserves, with a view to maintaining essential services, and to intervene in prices.

The Moldpres news agency reports that 55 out of a total of 101 deputies voted in favor of the proposal of the pro-European government of Prime Minister Natalia Gavrilita. «In the area of ​​gas supply, a critical situation has developed in our country», Explained the head of government during the parliamentary debate. The gas demand of the former Soviet republic has been covered by the Russian supplier only 67%, which endangers the lives of those who cannot obtain supply in their homes during the winter and the precarious economic situation of the country, which ends of receiving a loan from the IMF of 564 million dollars for the next 40 months with which to shore up its fragile recovery. The Moldovan economy contracted 7% in 2020 and the IMF expects it to grow 7.5% this year, but that forecast loses validity in a context of energy precariousness. The energy case will also make the fight against corruption, the main objective with which Natalia Gavrilita won the last elections, impossible.

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Given the present situation, Gavrilita has announced that his country will be forced to obtain natural gas from other sources, in addition to the fact that it comes through Ukraine and Romania, a measure for which a state of emergency was also necessary. The government recently extended the contract between Moldova and Russian energy giant Gazprom, which should have expired at the end of September, for another month. Negotiations with Gazprom continue, Gavrilita said, but the uncertainty has made the situation in Moldova even more tense and the government fears possible political instability. Its technicians suspect that Gazprom is not reacting to increased European demand to force the Nord Stream 2 pipeline into operation quickly.

The Russian side has repeatedly denied such allegations. Although the work is finished, the approval of the controversial Baltic Sea line between Russia and Germany is still pending. However, President Vladimir Putin repeatedly promises multiple rapid gas deliveries through Nord Stream 2.

Gavrilita decrees the state of emergency supported by the absolute majority that his party, Acción y Solidaridad (PAS) has in parliament, which voted in extraordinary session. “We have a deficit of about 16 million cubic meters in the national gas market”, justified the decision, “the declaration of the state of emergency will allow financing to be provided to Energocom, the central electricity supplier, to acquire gas on the market at the price current and in cash ».

Moldova is the first exponent of a threat that affects all of Europe

The price of TTF natural gas for delivery in November in the Dutch market, considered a reference in Europe, stands at 87.83 euros per megawatt hour (MWh). The Moldovan Minister of Infrastructure and Regional Development, Andréi Spinu, has made the necessary financing calculations and established the relevant contacts with alternative suppliers in Ukraine, Romania and Poland, after announcing, a week ago, the state of alert in the sector, step prior to the state of emergency, after verifying that gas consumption in the country exceeds the volume it receives from Russia. Added to the gas shortage is the lack of new contracts that can give the Moldovan government predictability. In parallel, it tries to continue negotiating with Gazprom, asking the Russian to include last year’s rates in a new contract, since the current price is “unjustified and impractical”, but the Russian side considers the Moldovan demands exaggerated. At the moment there is no agreement on the table and “it is not certain that there will be one.”

Moldova is only the first exponent of a threat that affects all of Europe. The EU needs gas and nuclear energy as “stable sources of energy”, said on Friday the president of the European Commission, Ursula von der Leyen, who also warned that “it is evident that it is necessary to promote its own renewable energies”, such as the wind and solar, which offer “a lot of independence” to the continent from the use of gas. But “Along with renewables, we need a stable source of energy: nuclear and, during a transition period, of course, gas, “he added. The European Commission must propose before the end of the year a list of energies considered favorable for the climate, which will facilitate access to capital under “green financing”, which would give them a crucial competitive advantage.

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