Romania's partial suspension of renewable incentives ‘is not consistent with EU Directives’, says RWEA

The Romanian Wind Energy Association (RWEA) warned that investors may file complaints against the Romanian state, after the government amended the renewable energy bill to partially suspend the incentives for green energy producers.

The RWEA, which has law firms, equipment producers and utilities among its members, said the amendments to the renewable energy bill couldn’t be made through a government ordinance. It added this move is not consistent with EU Directives and could be considered illegal.

Investors are facing losses in the hundreds of millions of euros and some of them may decide to file a complaint against the Romanian state to international courts.

Ionel David, president of RWEA, said that Romanian citizens may eventually have to pay for “some astrayed decisions of the government.”

“We are completely dismayed that the government has not taken into account any of our suggestions, despite the latest statements made by the prime minister, Victor Ponta, that they will be considered. In fact, there was no negotiation, though it was repeatedly requested by our Association,” said RWEA representatives.

PM Ponta said the partial payment delay for green certificates was made to save the industrial sector from higher electricity bills. Government officials stressed in the past that such a measure would also cut the electricity bill for household consumers by 10 percent this year.

Constantina Nita, delegate-minsiter for energy, recently commented that leaving the support scheme unchanged would cost Romania around EUR 1 billion in 2014.

However, the wind association said the energy price in Romania has fallen by 40 percent in the first semester. Experts say the higher output of renewable producers coupled with falling demand have contributed to the price reduction.

The RWEA president said the recent decision confirms the statement of European Commissioner of Energy, Guenther Oettinger, who recently commented that ‘Romania is barely governable’. He added this decision runs the risk of crashing the banking sector, as the wind projects have been built with banks loans.

Under the amended renewable legislation, wind producers will get one green certificate instead of two. The missing certificate will be recovered by wind investors starting January 2018.

Wind producers got one certificate prior to November 2011, when Romania approved the support scheme.

Wind has been the main growth driver for the renewable sector in the past four years. Foreign utilities in the likes of CEZ, ENEL or Verbund have build massive wind farms and it is estimated that investors have committed around EUR 3.5 billion to build a strong presence locally. The wind installations reached around 2.1GW by April.

Although the incentives attracted masive investments, no equipments manufacturer for the renewable sector opened any manufacturing plants locally.

Ovidiu Posirca

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