The deindustrialization of the high-energy intensive sector will also impact households due to an expected increase in unemployment triggered by layoffs within large power consumers.
However, Romania has enough power generation capacities to cover an annual increase of 0.7% in electricity demand. Black coal-fired thermal power plants generate ineffective costs which further generate nearly 24% higher energy costs for the Romanian economy.
AT Kearney and Fondul Proprietatea believe that subsidies and the inefficiencies of the electricity market artificially boost the actual cost of electricity by 24%. In fact, the real cost of electricity is EUR35.5/MWh, compared to EUR43.9/MWh.
“In 2025, the renewable energy, mainly wind and biomass, are expected to remain the most appealing to investors, while keeping the current government support scheme,” according to the study.
Moreover, eliminating the inefficient energy production units will help Romania become a competitive electricity exporter.
The study also shows that electricity exports are expected to stay at 3.3 TWh/year by 2025.