Under the protection of every government since the beginning of the 2000s, one of the most exclusive business clubs on the local market was created, which had strong political ties and came to dominate the energy trade.
While they were making hundreds of millions of euros, the government was pushing its most valuable asset, Hidroelectrica, to the brink of disaster. More than ten years after the former president Traian Basescu called them ‘smart guys’, these people have become a shadow of their former selves in the business sector. The heyday of these energy traders was precisely during the term of the former president. On the other hand, Hidroelectrica, though still insolvent, announced it expected a record gross profit of 1.3 billion lei (EUR288 million) for this year.
Without direct access to the cheapest source of electricity in the country, the traders that had the privilege of having contracts worth hundreds of millions of euros with Hidroelectrica dissolved, while others changed their core business. Some had zero revenue last year, while others posted decline they would not have expected to post back in 2011, their last year of buying power directly from Hidroelectrica.
Energy Holding, the company that practically invented the energy trader business in Romania, ended last year with RON193 million revenue. Back in 2011, its revenue stood at RON747 million. The trader was established by Bogdan Buzaianu, who was close to the former industry minister Dan Ioan Popescu, during whose term Hidroelectrica started selling power under bilateral contracts at secret prices that were below the market prices.
Alpiq RomEnergie, a Swiss-held company, which was said to have been an offshoot of Energy Holding, posted RON715 million revenue in 2011. Finance Ministry data show it did not register any revenue last year.
Two of the major hydropower buyers have completely reinvented themselves. Euro PEC, for instance, dissolved and merged with another company. The former trader is now selling equipment instead of power. Energy Financing Team Romania, another buyer of cheap power from Hidroelectrica, dissolved in 2014 and reemerged as EFT Furnizare. The company is an electricity supplier. (EUR1=RON4.5125)
English version by Loredana Fratila-Cristescu