On the smaller funding effort needed to complete a project, the support scheme that generated the boom of this field also dwindled and now the price of green certificates is nearing the minimum level stipulated by law. Hence, industry people say there are low chances for new projects to emerge even amid the plunging costs.
“Projects underway will be finalized, but nobody will undertake anything new. It’s too risky,” says George Voicu, a supply manager at Tinmar Ind, Romania’s largest private supplier of electricity, with EUR350 million in revenue last year. The company, controlled by businessman Augustin Oancea, has a portfolio of 50 MW of photovoltaic parks, developed in the wake of investments of around EUR65-80 million.
According to a report by the energy watchdog ANRE, the cost of installing a MW in a solar park hit EUR1.3million from EUR1.9 million in 2020. The value is almost 62% lower from the benchmark level of EUR3.5 million taken into account when the support scheme for green energy was devised.
“There were several factors that prompted this,” explains Voicu. “Costs were optimized at industry level amid price downward pressures”. The flood of Chinese solar panels, which hurt the European industry, was another factor.
Meanwhile, though, the support scheme has also changed. For those that deliver their parks this year, the scheme grants only 3 green certificates.
It was not only costs for solar projects that went down, but also those related to biomass projects and hydropower stations.
Thus, according to ANRE information, to build a MW in a biomass station an investor must come up with EUR3.1 million, 10% less than in 2012 and down 34% from the benchmark prices taken into account for the support scheme. Despite this, the scheme for biomass projects has remained unchanged.
In the case of new hydropower stations, costs per installed MW shrank in 2013 by 6.3% to EUR2.2 million. The least cost change was registered for wind power projects, by just 1.4% last year against 2012, to EUR1.46 million. Starting this year, new projects get only 1.5 green certificates.
According to law, the value of a green certificate ranges between EUR27 and EUR55 per unit, but according to OPCOM energy bourse data the trading price now revolves around EUR29, close to the minimum set by law.
According to Transelectrica data, over 1.38 million green certificates were issued in the first two months of the year and 0.8 million units were postponed. According to the same data, Romania at the end of February had almost 2,800 MW in wind projects, 1,149 MW in solar parks, 542 MW in small hydropower stations and around 100 MW in biomass projects.
“The cost/benefit analysis shows no moves to cut the number of green certificates for producers to be licensed after January 1, 2015 are necessary,” concludes the monitoring report drawn up by ANRE.
(English version by Catalina Apostoiu)