Dr. Ion LUNGU AFEER President

DRIVERS FOR INVESTMENTS Demand; Fuel availability; Market signals; Production costs; Energy mix; Environmental concerns;

CHALLENGES Tax policy; taxes down or up; Social security policy; Energy policy Energy mix; Role of renewable; Emission and climate exchange; Network expansion and structure- smart grid; State subsidiaries for energy intensive industry; Electricity prices: unstable regulation and inadequate tariffs; Price development of CO2;

CHALLENGES (II) New generation studies needed; The companies become more prudent to invest in new capacities; The regulated activity become more attractive; The investments in renewable continue to be a priority; The policy of extension (M&A) become more prudent;

MARKET INTEGRATIONS ; MAJOR OBSTACLES. Technical limitation; Regulatory diversity; market models; CBT; lack of competition and coordination; Market abuse; lack of transparency & discrimination; Role of NRA; Political interferences; Access to financing more difficult for energy project; Efficiency improvement not expected; Dominant market position could impact in price rice;

ENERGY MARKET LIBERALIZATION Co-existence of wholesale market prices and regulated consumers prices; Non market based retail tariffs; Limited liquidity of the market; Export / import limitation (fees); Long term contracts not linked to market prices; VAT regulations;

ROLE OF SUPPLIERS Promote the competition tools; Increase the liquidity; Increase the flexibility of electricity supply; To act as portfolio manager offering more and more complex products; Take the responsibility of unbalances ; risk management;

SUPPLIER ACTING AS INTEGRATOR Generators (T,N,H) Import Eligible consumers DAM; BM Suppliers Export DAM; BM SUPPLIER Suppliers

CONCLUSIONS : OPEN / FAIR / EFFICIENT power market could: Attract investors; Bring new capacities alive at market price; STABLE & PREDICTABLE regulatory framework needed; AFFORDABILITY ; do not forget that final consumers pay everything.

THANK YOU VERY MUCH FOR YOUR KIND ATTENTION!