The Ministry of Energy has initiated steps to reform state-owned companies in the energy sector, aiming for total savings of over 1 billion RON without affecting the proper functioning of production activities or ongoing investment plans

In the context of optimizing public spending, as required by Emergency Ordinance no. 156/2024 on fiscal-budgetary measures for the general consolidated budget for 2025, as well as increasing efficiency in the energy sector, the Ministry of Energy has launched a broad process to streamline and restructure state-owned companies in the field.

At the beginning of the year, the Ministry of Energy announced a restructuring plan for state-owned energy companies, targeting a substantial reduction in costs and elimination of inefficiencies to ensure their long-term sustainability. In this regard, Sebastian Burduja, Minister of Energy, has requested all companies under the ministry’s portfolio to conduct a thorough analysis of their activities at all functional levels and submit an Expenditure Optimization Plan. This plan should outline the implementation of reform measures as well as concrete actions to increase revenues by assessing non-productive/non-functional assets and proposing clear solutions for their economic utilization.

Key Measures:

• Reduction of management positions by at least 30% – streamlining organizational structures and eliminating unnecessary functions to cut bureaucracy and improve decision-making efficiency.
• Decrease in total salary expenses by reducing administrative staff by at least 20% – optimizing internal processes while ensuring that essential employees in production activities (mines, power plants, hydroelectric plants, nuclear power plants, etc.) remain unaffected.
• Reduction of goods and services expenses by at least 20% – reviewing all procurement contracts to secure the best prices and eliminate unnecessary expenditures (e.g., purchasing vehicles, computers, or consultancy services that are not essential).
• Cutting protocol and sponsorship expenses by at least 50% – redirecting these funds towards investments in the energy sector.
• Freezing new hires – employment will only be permitted in cases where a position is crucial for company operations or development.

Currently, the Ministry of Energy is centralizing and analyzing the expenditure optimization plans submitted by state-owned energy companies. Additionally, potential restructuring and mergers between companies are being considered, including the merger between Electrocentrale Grup and ELCEN Bucharest, as well as the integration of the Research Institute for Mining Technology and Design in Craiova with the Oltenia Energy Complex.

“Streamlining state-owned energy companies is an investment in Romania’s future and a necessary measure, particularly given the current fiscal and budgetary constraints. As the primary shareholder in many of these companies, the Ministry of Energy is committed to real reforms. These measures are designed to benefit the companies, and we expect support from both management and social partners (trade unions). Our goal is to ensure the long-term viability of state-owned energy companies while optimizing public resources.

A key message for all employees and union representatives: these measures will not affect essential staff in productive activities. We are specifically targeting the administrative apparatus and excessive bureaucracy. Thousands of employees hold non-technical (TESA) positions in these companies. Some are competent and will continue to perform their roles effectively. Others will have the opportunity to find employment in the private sector, where there is a labor shortage. We have demanded transparency, fairness, and meritocracy from all companies and will closely monitor the implementation of these plans.

By reducing costs and increasing efficiency, we are strengthening Romania’s energy security, creating a more stable and competitive framework for the energy sector, and contributing to economic development through energy infrastructure investments. The Ministry of Energy is determined to implement these measures fairly, ensuring the continuity of existing operations, the development of new initiatives, and the protection of employees’ interests,” said Sebastian Burduja, Minister of Energy.