Winter Is Coming for Moldova

Until last year Moldova received all its gas from Russia, and its electricity from a power plant in Moldova’s breakaway Transnistria region, which was entirely powered by Russian gas. This arrangement gave Russia an annual opportunity to seek Moldovan concessions or suffer the consequences in both gas prices and the volume of gas supplied. In the winters of 2006 and 2009 Russia made good on its threats, shutting off gas to Moldova—leaving large swaths of the population without heat. This struggle is a perfect window into Moldova’s complex and layered relationship with Russia and Transnistria, as well as Moldova’s internal challenges with institutional effectiveness.

Russian gas has flowed into Moldova via Ukraine since the fall of the Soviet Union. While much of Europe now purchases gas from elsewhere, ensuring Russia is no longer the region’s primary supplier, Russian gas still flows into Transnistria. The Russian energy market will take another hit when its contract with Ukraine to transport gas via pipelines in Ukrainian territory expires in December 2024. This will leave the Turkish TurkStream as one of the only pathways for Russia to transport gas to Europe. However, Ukraine is willing to accept different transit methods and has indicated that if European recipient countries wish to purchase gas from Russia, or if Russia wishes to place a bid for the sale of their gas in European markets, that gas could flow through Ukrainian pipelines.

Last fall, Moldova, under the leadership of President Maia Sandu, broke its full-scale dependence on Russian gas. This was possible via Moldova’s connection to the Iasi-Ungheni pipeline, which runs through Romania and is a reverse flow of the Trans-Balkan pipeline. This winter, none of Moldova’s gas will be imported from Russia.

But this step toward decreasing dependence on Russia is not enough, as a majority of Moldova’s electricity continues to flow through Russian operated power plants in Transnistria. Transnistria, a region of Moldova that Russia also claims ownership to, receives heavily subsidized gas from Russia, which in turn attempts to bill the Moldovan government for the costs. A recent audit found that Moldova owes only $9 million, versus the $700 million Russia claims it owes. While Russia is disputing the results of this audit, it will allow Moldova to begin restructuring the state-owned energy company, which is a key step in larger, longer-term reforms.

For the last two years the European Union has provided funding to support subsidization for vulnerable households’ fuel costs. While this much needed relief helps Moldovans survive another winter—it is not a long-term solution. The World Bank has supported projects to increase the efficiency of the heating systems and to build pathways for Moldova to connect to Romania’s electrical grid. The solutions for partners seeking to help Moldova develop long-term energy independence is going to take time. 

Now is the time—before Russian gas ceases to flow to Transnistria and while Moldova has the most pro-reform government in its history—to help Moldova move toward a future where Russia’s malign hand can no longer reach into Moldovan homes and control the thermostat. To support this, the international community needs to work with the current Moldovan government to ensure the following occurs before the winter of 2024:

  • The European Union should ensure that at least two of the three lines of the currently in construction electrical system between Romania and Moldova are operational. This will enable Moldova to receive electricity from sources other than Transnistria or Ukraine.
  • The European Union can and should look for and provide additional gas to Romania through 2027, when Romanian domestic production will increase.
  • The European Union, the United States, and other partners and allies should continue to provide funding for subsidized rates for Moldova, with subsidies falling off in 2030.
  • The United States should continue to provide support across the energy sector focusing on technical experts and support to Moldova implementing legislation and regulations to support free market best practices, including in the restructuring of state-owned enterprises.
  • The Moldovan government should prioritize increasing the collaboration and planning for energy pathways and contingencies with the leadership in the Transnistrian region. This will not only serve to determine pathways toward continued use of the electrical plant in Transnistria, with gas supplied from non-Russian sources, but also toward a better integration of Transnistria with Moldova.

While these are important short-term measures to remove Moldova’s dependence on Russia, there should also be integrated efforts toward energy independence. This should include a focus on renewable energy. Further developing wind energy is something the United States should consider increasing support for in the longer term. Through a thoughtful integration of these measures, Moldova will be ready for when Ukraine turns off Russia’s tap in December 2024.

Daniel F. Runde is a senior vice president, William A. Schreyer Chair, and director of the Project on Prosperity and Development at the Center for Strategic and International Studies (CSIS) in Washington, D.C. He is also the author of the The American Imperative: Reclaiming Global Leadership Through Soft Power (Bombardier Books, 2023). Leah Kieff is a senior associate (non-resident) with the Project on Prosperity and Development at CSIS.

Daniel F. Runde
Senior Vice President; William A. Schreyer Chair; Director, Project on Prosperity and Development
Leah Kieff
Senior Associate (Non-resident), Project on Prosperity and Development