Cutting subventions might double or triple prices for hot water and heating

Vineri, 7 mai 2010, 14:16 English | Top News

The prices for hot water and heating are likely to increase massively if the decision to cut subventions will be met, as suggested by Romanian President Traian Basescu. In many cases, prices might double or even triple. For example in Bucharest, where the population is paying 119 lei per thermal unit, the prices might go up to 300 lei. The difference is supported by the capital’s general council and by the Interior and Administration Minister.

Big differences between the real price and the price the population pays are also present in other counties. Like in Bacau (east): SC TERMON CT SA Onesti delivers supplies heating by 312 per thermal unit, while consumers pay 164.76 lei. SC Termica SA Suceava (North) supply heating and hot water at 360.40 lei, while the figures on the bill read 178 lei. RADET Constanta (S-E) puts up with costs of 305.65 lei, while the population pays 137 lei.

The idea of cutting subventions does not belong to the President. Bucharest mayor Sorin Oprescu spoke about cutting all subventions for hot water in early March. He also announced he indented to reduce the heating subvention by 50% and to lose it just over the summer. According to him, half of the council's budget was spent on subventions for transport and heating.

Centralised systems in Romania serve over 1.6 million apartments, out of which 571,000 in Bucharest. For many local authorities, heating stations are a burden. Most of the flats have been built during the 60s and 70s, but state authorities considered they could still work, despite the large amount of money they demand. The systems in these blocks of flats have low efficiency, 25-35% losses and high production costs.

Basescu claimed that the money obtained by cutting subventions will be allocated towards people who need financial support.