A farm of this size generates annual revenues of between EUR8 and EUR9.6 million, according to the new support scheme.
Although bureaucracy is extensively debated in Romania, statistics in this respect show that Romania is among the top countries in the wind energy sector, with access to the grid taking much less than the European average.
“In Romania an average wind farm has a capacity of around 50 MW, which far exceeds the European average. This is possible because of the low population density in rural areas in Dobrogea – Romania’s main area for wind energy sources,” reveals the”Wind energy and other renewable energy sources in Romania report” conducted by consultancy TPA Horwath and law firm Schoenherr.
Last year Romania became the country with the largest onshore project after Czech group CEZ finalized the installing of the 240 turbines in the Fantanele-Cogealac farm, with a capacity of 600 MW, which cost EUR1.1 billion.
“It is remarkable that 923 MW have been installed in Romania, covering 8% of the EU’s total new sources of energy in 2012. The 94% increase in Romania’s total wind capacity recorded in 2012 will probably never be matched,” the research conducted by the two companies also shows.
This year it is estimated that a further 617 MW will be installed in wind projects, which means investments of over EUR900 million. So in total the wind industry will attract over EUR3.6 billion between 2010 and 2013 to install a capacity of around 2,500 MW.
“So far Monsson Group [controlled by businessman Emanuel Muntmark] developed around 40% of Romania’s over 2,000 MW of installed wind power capacity,” the research also shows. Muntmark’s projects have over time been bought by CEZ, OMV Petrom and ButanGas.
How the money is distributed and what revenues a wind farm makes
“The acquisition of the turbine is the most important part in the structure of the investment cost, accounting for 50% to 75% of the investment spending,” the survey reveals. The average cost per MW in installing a wind turbine is around EUR1.5 million. So a farm with an average size of 50 MW will cost around EUR75 million.
A wind farm operates at a yield of around 25%, according to market data, and delivers around 110,000 MWh of electricity per year. One can get revenues of between EUR3 and EUR4.7 million from selling energy on the energy bourse if one considers average spot prices and those on last month’s market of bilateral contracts.
Before the changes to the support scheme, each megawatt-hour of energy was reward with two green certificates.
The latest price on the energy bourse was 175 lei (EUR39) per green certificate.
So, according to the old support scheme, energy production of 110,000 MWh was rewarded with green certificates worth EUR8.6 million.
But starting in July investors will get only one certificate, and the other one as of 2018. So annual revenues from green certificates will amount to around EUR4.3 million, considering the latest price displayed on the OPCOM bourse.
Applying the new provisions that will be in force as of July and based on current prices, revenues of a 50 –MW wind farm amount to EUR8-EUR9.6 million per year.
Under the old legislation, with two green certificates, revenues ranged between EUR12.2 million and EUR14 million per year.
What are the costs?
“According to a survey conducted on several energy projects, companies’ average annual operating costs can reach around EUR57,500 per MW, with the market price ranging between EUR50,000 and EUR60,000,” the report also shows.
For a 50-MW project, average annual costs amount to EUR2.8 million, with the bulk being administrative, maintenance and operating costs. To these add interest rate costs, if the wind farm is financed through a loan. These costs can amount to EUR103,000 per month in the first few years of the investment.
Under the new support scheme, the money invested in a 50-MW project can be recouped in 11-13 years, while under the old legislation the investment was recouped in 7-8 years.
“Usually the lifetime of a wind farm is 20-25 years if the equipment is new and if standard maintenance and repair work is done,” the report also reads.
In order to get a wind energy project going, an investor needs to get no less than 85 permits and authorizations. This may seem like a lot, but in fact in Romania the process is smoother than in other countries.
The largest investors in wind energy in Romania are CEZ (the Czech Republic), Enel (Italy) and Energias de Portugal. This year new major investors joined the Romanian market – Austria’s Verbund, French-Belgian GDF Suez and Russia’s Lukoil.
(English version by Daniela Stoican)