Total investments in renewable energy have so far exceeded EUR3.5 billion, but because of imminent reduction of subsidies to producers, the Romanian energy sector could lose some of its appeal. Czech group CEZ, one of the largest developers on the Romanian market, has already announced its intention to focus on the Polish market, instead of the Romanian one.
The Romanian wind farm market added almost 300 MW to its capacity, according to data from energy transmission company Transelectrica and operating the new wind turbines entailed investments of around EUR450 million, according to ZF calculations based on a cost of EUR1.5 million per megawatt installed.
By comparison, the solar energy sector gained only 42 MW, which were installed following investments of around EUR64 million, starting from a standard cost of EUR1.5 million for installing one MW. In the first two months of this year solar projects with a similar capacity to that installed in the whole of last year were set up.
In the case of biomass energy, facilities with a total capacity of around 5 MW were installed after investments of EUR17.5 million and the installed power in hydropower stations that benefit from the support scheme also increased by 5 MW, after investments of around EUR11 million.
EUR100M for green energy
Transelectrica data also shows producers of energy from renewable sources received support of more than EUR100 million in the first two months of the year – the value of green certificates provided through the subsidizing scheme. 180 companies were listed as producers of renewable energy eligible for support through the green certificate system at the end of February. More than 1.8 million certificates were issued in the first two months of 2013, corresponding to energy production of 1 TWh from renewable sources.
Data of energy exchange OPCOM shows that in the analyzed period the average price at which green certificates were traded was 241.49 lei (EUR55.07), so producers of wind, solar, hydro and biomass power received state support of EUR102.5 million. This is twice as high as the amount collected by green energy investors in the same period of last year – EUR47 million. The value of green energy certificates in the first two months of the year alone is already equal to one third of the value of green certificates for the entire 2012.
Wind continues to get largest amounts
Wind power projects produced the bulk of Romania’s green energy, with the exception of major hydro-power stations, which are not eligible for support through the green certificates system. Wind farms got the biggest chunk of certificate allocation – EUR1.6 million certificates worth a total of almost EUR88 million.
The CEZ group has remained leader in the ranking of green certificate beneficiaries, and is also the largest investor in renewable energy in Romania. The Czech company has invested EUR1.1 billion to build the largest onshore wind farm in Europe, with a capacity of 600 MW in Dobrogea, SE Romania. Data of the national energy transmission company shows CEZ received green certificates worth almost EUR30 million in the first two months of the year.
CEZ had planned to expand investments in the Romanian energy sector and add a generation capacity of 1,000 MW by 2016, which would have entailed total investments of over EUR1.5 billion on the local market. But the reduction of the support scheme has offset the group’s plans in Romania, with CEZ announcing it will focus on the Polish market, where it intends to build wind farms of 760 MW, according to Bloomberg.
No. 2 in terms of the value of green certificates attracted are investors in biomass energy, which collected around EUR7.3 billion. In turn, producers of hydropower in facilities with capacities of less than 10 MW received EUR5.4 million, while owners of solar farms collected EUR1.7 million in the first two months of the year.
Uncertain future after investments of EUR3.5B
The Romanian authorities are discussing cutting subsidies for renewable energy, a sector that has so far attracted investments in excess of EUR3.5 billion. While Romania offers good weather conditions for wind power, the determining factor for the investments was the generosity of the support scheme offered by the state. If the support scheme will become less generous, many of these investments will not be carried out and those that will be implemented will prove less profitable than anticipated.
(English version by Daniela Stoican)