Energy Country Profiles

• Albania

• Bosnia & Herzegovina

• Bulgaria

• Croatia

• Czech Republic

• Estonia

• Hungary

• Latvia

• Lithuania

• Macedonia

• Moldova
  • Administration
  • Energy Policy
  • Energy Market Actors
  • Energy Supply
  • Energy Sources
  • Energy Demand
  • Environment
  • References

• Montenegro

• Poland

• Romania

• Serbia

• Slovak Republic

• Slovenia

• Turkey

• Ukraine

• About enerCEE|
• Green Electricity in CEE|
• Energy Policy and EU Enlargement|
• enerCEE Links

• Home
• |Moldova
• |Energy Market Actors

Electricity Market

Until the start of privatization in 1997 the state company Moldenergo was responsible for the production of electricity and heat. In 1997, a reform of the energy sector was launched, and hence the state company was divided into 16 new entities: 8 electricity production companies, 3 district heating companies and 5 electricity distribution companies.

In 2000, the Spanish company Union Fenosa purchased almost two-thirds of the electricity distribution network, thus becoming Moldova’s largest foreign investor. The company bought three of the five regional electricity distribution companies (REDs) in the country, RED Chisinau (servicing the capital), RED Centru (servicing central Moldova) and RED Sud (servicing southern Moldova) for USD 26 million in an open tender. The Union Fenosa service area covers 60 % of Moldovas population. Two other regional electricity distribution companies, RED Nord (servicing the northern Moldova) and RED Nord Vest (servicing the north-west of the country) remain state owned. (see map below)

World Bank. “Sharing Power: Lessons learned from the reform and privatization of Moldova’s electricity sector”. World Bank. 2004.

In 2000 SOE „Moldtranselectro” was restructured into three distinct companies. These were Moldtranselectro” itself, SOE „Moldelectrica”, which undertook the functions of transmission and central dispatch, and SOE Costesti Hydro Energy Node.

The Electricity system in the Transnistria region is operated by Dnestrenergo company, with headquarters in Tiraspol. Dnestrenergo includes Eastern electricity networks in Dubasari city, South Eastern electricity networks in Tiraspol city and the Dubasari Hydro Power Station. The dispatch for all these companies is centralized and performed by SOE Moldelectrica.

[Energy Strategy of the Republic of Moldova until 2020]

However, since 1998 the sector has been in a continuous crisis, given the overall economic decline and the energy prices reaching the world level. Power distribution networks have deteriorated and, according to the Energy Institute of the Academy of Science, are worn out up to 50 %. The energy transmission losses make from 14 up to 18 % (for comparison Germany: 6 %).

The Energy II project implemented by MEPIU is designed to support the transition of the electricity sector to a modern, commercially oriented industry, capable of financing itself and providing reliable and sustainable domestic electricity service, and enabling Moldova to play a role in the regional international energy markets and get closer to the eventual UCTE membership. The Project also supports the transition of the heating sector to a more economic, decentralized heating supply and more efficient use of energy. Through restructuring the debt arrears, the project will remove a major threat to fiscal stability, reliability of power supplies and to the sustainability of sector reforms in general. The total project cost, including financing from the WB, co-financing from beneficiaries and other donors (SIDA, USAID) is estimated at approx. US $ 40 million.

[MEPIU]

Thermal-Electric Power Stations in Moldova

There are four significant thermal-electric power plants in Moldova: CET-1, CET-2, CET-Nord, and CERS Moldova (also known as Moldavskaya GRES or Cuciurgan). CET-1, CET-2, and CET-Nord are combined heat and power (CHP) plants, currently run by a state-owned utility.

CERS Moldova, the largest thermal power plant, is also a separate legal entity located in Dnestrovsc City in the Transnistria. CERS Moldova has 8 units of 200 MWe each and 4 units of 230 MWe each for a total of 2,520 MWe. However, these units are reported to be in poor condition, with only 900-1,100 MWe available.

[Energy Strategy of the Republic of Moldova until 2020]

Oil and gas market

Oil

Oil reserves in Valeni, Cahul district are estimated at 0,5 mln tones. These reserves have been explored since 2004 to an amount of 14,500 tones of oil, at a maximum annual extraction rate of 8,000-9,000 tones. Extracted oil has been processed at the Comrat mini-refinery. Exploitation of these oil reserves is set to resume when a new concession agreement is signed.

The internal oil products market is totally liberalized and is entirely served by private business entities which are licensed for the import and sale of oil products. The current consumption of oil products (diesel oil, gasoline) in the country is about 600.000 tones. The largest importers are Lukoil Moldova, Petrom Moldova, Tirex-Petrol, Rom-Petrol, and Valexchim, which cover about 80% of the oil products market. The storage capacity for oil products in the country is 600.000 tones.

Moldova has access to the Danube for only about 480 metres and Giurgiulesti Port is the only Moldovan port on the Danube. The building of an oil terminal started in 1996 and it was concluded in 2007 by the Dutch group which took over the Giurgiulesti investment project from the Azeri Azerpetrol in mid-2006. According to the investment agreement, investments in the project should amount to 250 million dollars. When the terminal is completed, the company in charge is to put into operation 50 fuel filling stations, construct a passenger and cargo port and an oil refinery with a workload of one million tons of oil a year.

[Europe MD]

Natural gas

The Russian-Moldovan joint venture JSC Moldovagaz (Moldovagaz) was set up, with 50+1% of its shares owned by "Gazprom" of Russia, 34% by Moldova Gaz, 13% by the Transnistria region (part of the company’s assets located in the Transnistrian territory) and 2% by the physical persons from Moldova. These shareholders are the owners of the gas system of the Republic of Moldova, including transit upstream (high pressure) pipelines in the territory of the country. According to the Gas Market Rules, Moldovagas is designated as the national operator of the gas system.

The corporate structure of Moldovagaz includes the following companies, which are registered as Limited Liability Companies and perform different functions:

• two transmission companies: “Moldovatransgaz” (operating in the Right Bank) and LLC “Tiraspoltransgaz” (operating in the Transnistrian region);
• 12 distribution companies in the Right Bank, with branches in every regional centre and 6 distribution companies in the Transnistrian region, which operate distribution networks and supply natural gas to end consumers on a contract basis;
• a company specialized in importing and distributing liquefied gas.

Moldovagas also includes a centre for training gas industry personnel. Natural gas is imported into the territory of the country and transited to other countries under contracts between Moldovagaz and Gazprom. The other companies mentioned above play also their respective roles in the technical implementation of these contracts. At the same time, between 2000 and 2007, gas networks of different pressure levels of over 8000 km length and approximate value 100 MUSD were built with state finance. These networks belong to the State.

The national gas system includes independent business entities (license holders) that build and operate gas distribution networks from their own financial sources. The most important of these are: LLC Rotalingas Trading, which gasified 10 localities in the Hincesti region, 8 localities in the Laloveni district, and 1 in the Straseni district investing in the last three years over 120 mln. MDL; LLC Sefgaz in Soroca city; and Nordgaz in Singerei city.

[Energy Strategy of the Republic of Moldova until 2020]

Since the beginning of the regulation and licensing activity, 59 companies received licenses for the supply of regulated and non regulated tariffs. The number of valid licenses for the supply at regulated tariffs on 31.12.2007 amounted to 28. ANRE regulates the end-user prices.

[ERRA]

Coal market

In 2007, Moldova imported 180 thousands tons of coal. 103 thousands tons of the coal is imported from Russia (40%) and Ukraine (60%). In total, there are 34 coal depots in Moldova. Brown coal deposits exist in the south but have yet to be exploited.

The major company operating in coal import and storage is Combustibil Solid Joint Stock Company.

Coal Production and Consumption in Moldova, 2003-2006 (in thousands of tons)