EurActiv and Reuters report that Romania is cutting support for renewable energy projects. Importantly, the government sees this as an important measure to cut price increases to consumers, both residential and industrial. It is difficult to know what this means for Romania to meet its 2020 objectives.
Romania slashes renewable energy subsidies
Romania will cut its support scheme for new wind, solar and small hydro renewable energy projects from January, a government decree said Tuesday, 17 December, to avoid overcompensating producers and curb price increases for industry and homes.
The incentives give developers green certificates for each megawatt generated and force power suppliers and large users to buy them based on an annual quota set by the energy regulator. Green energy investors gain once by selling certificates and again when they sell their electricity. Under the new government bill, wind energy will get 1.5 certificates per megawatt until 2017 and 0.75 certificates onwards, from a previous 2 and 1 certificates, respectively.
Support for solar projects was halved to three certificates per megawatt, while small hydro power plants will get 2.7 certificates per megawatt instead of 3. The new bill will affect only projects finished after January 2014, an adviser to Prime Minister Victor Ponta said.
The European Union’s support scheme, which has been in place since 2012, was once deemed too generous by the European Commission. It brought droves of foreign investors to Romania, particularly to wind energy, including Czech CEZ, Italy’s Enel or Energias de Portugal.
In June, the leftist government decided to hold off paying some of the subsidies for several years, a delay which applies to all producers. The Romanian Wind Association complained to the Commission over the subsidy delays. Czech CEZ, which operates Europe’s largest land-based wind farm in Romania, complained that retroactively changing the rules conflicted with basic EU principles.
Elsewhere in the EU, Germany, Britain and Spain have also cut incentives for renewable energy.
Energy in Demand - Sustainable Energy - Rod Janssen 
I can not answer the question about the potential impact of the reported reductions will have on Romania meeting RE objectives – but I certainly would not believe any estimates published by a source that does not know the difference between a megawatt and a megawatt-hour.
Ian, Excellent point. The “energy” people I know in Romania would never make that mistake. Now we have to get to the journalists, or whomever is responsible.
Whatever you guys (Government and journalists included) think about MW or MWh, Romania is profoundly distorted in its renewables policy and apparently nobody noticed this yet ?!…as additional major risk !…As of today, the simple statistics show that biomass and biogas potential in Romania is >2,5 times higher than ALL OTHER renewables (wind, solar, micro-hydro), whereas the “achievements” of such “smart policy” so far show that we have already installed >3000 MW capacities in wind/solar/microhydro and only ~ 45 MW (!!!) on biomass…and this is in industry only !!!… and this is happening in a country where heat (for district heating) is still a major problem, cost-wise and pollution-wise. Having in mind that biomass/biogas are the only HEAT PROVIDERS among the other renewable and considering the potential of COGENERATION, I would say that ALL OTHER renewables would have become meaningless or even not needed, if a right policy of promoting cogeneration on biomass/biogas would have implemented (as we all know CHP=combined HEAT & POWER, exactly in this order, stands for). But such a strategy needs knowledge, thinking and energy economics expertise, something which one cannot find so easy in the community of journalists or Governments…at least in Romania, the reality has proven this)
Dear Catalin, I fully agree with the points you have raised. I will raise your concerns with as many as I can. How we can turn things around is not obvious but something must be done. Thanks so much for this post.
From what I’ve read, the surge in micro- and mini-hydro-power plants in Romania has been at best a mixed blessing:
From http://www.romania-insider.com/report-romanian-micro-hydro-power-plants-wrecking-not-saving-the-environment/78540/ :
“According to WWF [the World Wildlife Fund], three years ago, two sites in the Fagaras mountains populated with species under threat, such as the otter, and several species of fish, were invaded by some 53 micro hydro power plants, destroying mountain rivers and these species and their habitats. Some of these micro hydro power plants are supported with European funding and get green certificates without any ecological criteria, supported only from tax payers’ money, according to WWF. The negative impact of these power plants moves over to local communities as it affects the drinking water supply. Romania has over 430 micro hydro power plants in different stages of planning, authorization and construction, and over a quarter of them are in protected areas or close to them, according to WWF. The construction of some 300 of these power plants was already approved without any pre-planning, WWF went on.”
Any thoughts?
Personally, as a professional, in principle, I am totally against micro-hydro in Romania… one does not to be an expert in energy to understand that for a couple of KW in a micro-hydro, (which can be generated much cheaper and much easier elsewhere) you have to destroy rivers, land, trees, animal habitat, etc., etc.. I tried to explain before, realistically, at this stage Romania DOES NOT NEED ELECTRICITY !..be it even on renewables, micro-hydro included !…the electricity demand has continuously decreased for the last 3 years…the only real demand is for HEAT !…and possible electricity associated with it (cogeneration mode)…so, the economic and sustainable support for renewables should be directed to biomass/biogas/geothermal/solar-heat-cooling, for its very large district heating systems (the 3-rd place in Europe, by size !). Trying to exploit these logically, even in a moderate way, Romania will meet its 20/20/20 EU obligations without any problem…and even without too much subsidy-support, provided that emissions/environment/real economics will be properly internalized and accounted for !….the bottom line is simple: instead of buying/importing ~1 bill EUR/year gas/oil for heating, better use the local renewable sources…this is what EED-27 says about “efficient district heating systems”…
To make things even much “worse”, Romania may not need even too much natural gas, coal, fuel oil, shale gas or gas from Black Sea platform ! if it would implement a sustainable renewable policy, or, better, tax heavily the fossil fuels use !.. Romania with its existing 1500 MWe Nuclear, 3000 MW hydro, 500 MW cogeneration for DH and today’s ~3500 MW renewables + a solid renewable policy for DH in cogeneration of high efficiency (potential is ~2000 MW) + reversible hydro-pumping I Tarnita of ~1000 MW, then, it is already too much for what it is realistically needed…and God save us to achieve, in addition, the target of 20% efficiency improvements !…then, we will worsen our situation with overcapacities available for wrong purposes…which somebody has to pay for !? and who else than the Romanian consumers !?. This is what we say in energy business: the consumers always pay for wrong policies, but the Government say the other way around: they blame the renewables for price increase !?…and this is happening exactly because the principles of INTEGRATED RESOURCES LONG TERM LEAST COST ENERGY PLAN are ignored !…all the rest is for “journalists comments”.
But all these above, if applied, unfortunately, will save any Government the “pleasure” to deal with “big projects” like cutting the ribbon of a nuke, or, to allow “foreign investors”, under their pressures (!), to invest in something which proves to be useless in the market and then, afterwards, to find ways out of the mess…
These are some excellent points about meeting the 20-20-20 targets and that, essentially, the real need is in heat. Unfortunately, most of the renewable energy policy in the EU has focused on electricity. I would like to hear from others. These are fundamental points not about renewable energy policy, but about energy policy per se.