Romania to widen subsidy scheme for energy bills -PM

The expanded scheme will run through February and March and will cost the state roughly 3 billion lei ($690 million), Ciuca said. The central bank said this month that it expected annual inflation to exceed medium-term forecasts largely due to higher gas and power tariffs, despite price caps and subsidies.

Romania's government will widen energy price caps and subsidies for households and some companies from the start of February to further soften the blow of higher power and gas bills, Prime Minister Nicolae Ciuca said late on Monday. The European Union state had already introduced a support scheme for households based on caps and subsidies up to certain monthly consumption levels.

On Monday, leaders of parties in the governing coalition agreed to make the support scheme more generous by raising caps and consumption levels, including schools, hospitals, small companies, and food producers. The expanded scheme will run through February and March and will cost the state roughly 3 billion lei ($690 million), Ciuca said.

The central bank said this month that it expected annual inflation to exceed medium-term forecasts largely due to higher gas and power tariffs, despite price caps and subsidies. Annual inflation rose above expectations to 8.19% in December, its highest level in a decade.

Earlier this month, Ciuca said the government planned to cut value-added tax on electricity to 5% from April to further extend support, but the three coalition parties have yet to agree on that measure. ($1 = 4.3363 lei)

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