Moldova Makes Significant Shift from Russian-Controlled (Transdniester-based) Power Supply to Ukrainian Supplier

In early April, Chisinau made a significant shift away from its dependence on Transdniester-based Energokapital for the supply of power to Moldova, opting for a new tender put forward by Ukraine’s DTEK Trading.  The country has long relied on power generated from the Cuciurgan (or Kuchurgan) power plant to supply approximately 80% of its power needs.  The plant is reportedly owned and controlled by Russia’s state-owned Inter RAO.  An intermediary company actually supplying the power from this plant to Moldova has been Energokapital, which has stoked significant frustration a over the years for its inflated prices and opaque  ownership structure.

The Moldovan government and public has expressed suspicion in the past that Energokapital and its ownership was diverting money for some unknown purposes and was clearly looking to make a change.  Although the contract was expected to be renewed, Chisinau, for the first time, chose to hold competitive bidding for contract renewal.  It appears, somewhat surprisingly, that Ukraine’s DTEK won that bid.  The previous contract expired on March 31.

The financial sustainability of the Cuciurgan plant is in question without its Moldovan client.  Despite plans to adjust the intermediary relationships involved and make the contract more transparent, the award has now been lost to a new supplier.  This is a profound development in the strategic relationship between Moldova and Transdniester, with possible repercussions in the period ahead.