Friday, June 26, 2009

E.ON to sue Romania over gas tariff cuts

BUCHAREST, June 25 (Reuters) - The Romanian gas distribution unit of Germany's utility group E.ON (EONGn.DE: Quote, Profile, Research) will sue the European Union state's energy price regulator after it enforced gas tariffs cuts in May, the firm said on Thursday.

Following Romanian authorities' decision to lower gas costs by 3 percent as of May 1, E.ON Gaz Distributie said it recorded "justified uncovered costs" worth 172 million lei ($40.8 million) so far.

"The decision... seriously affects the financial status of the company, endangering the stability of the employees' work places and the investment programmes," E.ON, which runs services in over 1,000 towns across Romania, said in a statement.

Romanian officials recently said gas tariffs will fall by another 5 percent as of July.

On Thursday, the European Commission accused 25 of the European Union's 27 member states, including Romania, of breaching rules to boost competition in energy markets. [ID:nLO30427]

State news agency Agerpres quoted the head of the state's energy price watchdog saying Romania will prepare a timetable for scrapping state-set prices for gas and electricity in response to Brussels criticism. (Reporting by Luiza Ilie; Editing by Mike Nesbit)

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