One or two gas exchanges? This is not the question

A scandal on the gas market regarding the legislative initiative that seeks to impose a single gas exchange on the gas market. The idea is not bad in essence, even if the issue of serious failures on this market is not due to exchanges and it should have been started with the mechanisms of market functioning and not with the (trading) instruments. In absence of mechanisms of market functioning, with one or two exchanges, we will continue to have slippages on the gas market.

The gas trading system consists in Romania, since 2013, of two platforms, both fully operational: OPCOM and BRM.

Analysing how these platforms have worked in the recent years, we believe that:

• OPCOM has proven its lack of capacity, in these years, to offer products and a platform to attract customers. As most of the ‘state-owned companies’, it is necessary to create a monopolistic situation to prove its capability on the market. The typical Romanian behaviour, through which one proves the management ability on the market only when ‘helped’ by regulations, laws etc. does not recommend today in any way choosing OPCOM as the gas exchange that should remain in Romania, as single exchange. The simple analysis of activity reports on the gas market in the past 3 years disqualifies it.
• Although it behaved well under the aspect of products and steps taken in the recent period, I believe that BRM has not provided sufficient elements of transparency, competition and non-discrimination. The analysis of the few public data, which are found on the BRM website, determines many question marks on how certain transactions have been carried out and on the games made on the market, using BRM platforms with or without their knowledge. It is true that these elements should have been supervised by the relevant institutions and they should have intervened whenever there were suspicions on how certain transactions have been carried out, with the application of the legal provisions in force, including the possibility to suspend/withdraw the operating license. In absence of investigations and decisions of the competent institutions supervising compliance with legislation and/or competition, any intention to remove BRM from the market is abusive.

In this context of experiences on the gas market, determined by the functioning of the two exchanges, but considering the normality of having a single exchange on the Romanian market, we believe that the following democratic approaches are theoretically possible:

1. Ensuring a competitive framework for carrying out the activity for a period of 2 years and selecting the entity that reaches the best performance.

• Requesting the competent institutions to submit reports on the functioning and performance of the two exchanges, in order to eliminate any suspicion on their activity.
• Eliminating all the institutional obstacles, which may flaw the real competition between them.
• Setting the performance criteria that will delimit the two entities in the following 2 years and which will lead to choosing the unique entity to remain on the gas market.

2. Removal by law of the license for the administration of the centralized markets, withdrawal of licenses of the two entities and the establishment of the gas market while setting transparent, unitary and fair selection criteria, and organizing a tender for the gas market administration license.