Romania: GDF Suez Energy Romania expects market regulation stability and restoration of RES investment framework

14. August 2015. / SEE Energy News

What energy companies need is a little more stability in terms of the regulations, because there are some very important rules that change often, and so, as the market changes, there are some regulations that are missing. Currently, there are some problems with the storage requirement when switching. Each supplier has to store gas, but when a customer changes it is also important that the next provider to ensure that stores gas for the request of the customer, because if he does there is certainly a risk, especially in winter, when the system is not balanced. This is still not regulated properly, this issue still to be addressed says Eric Stab, Chairman and CEO of GDF SUEZ Energy Romania.

If you look at prices in Romania, they are the lowest in Europe. For industry, increased significantly in the past few years, also as a result of the so-called calendar, but prices are still below average. I do not think anyone can say that in Romania the companies or consumers are charged too much.The problem we have is that because the system changes, we must ensure that all necessary steps are well managed. For this, we need to anticipate, understand what is at stake explains Stab.

The regulation is quite complex. It is a complicated industry, companies must dig into it to understand how it works. The problem we have is that we tend to regulation which is not sufficiently predictable. There are things that are basically changed at very short notice, not necessarily in full compliance with regulatory methodology that was originally announced. This has a significant impact on suppliers, distributors and on their investment plans stresses Stab.

There are problems with Renewable energy framework which is slightly different. Romania is relatively close to achieve objectives related to renewable energy, although highly dependent on hydropower production. Water production fluctuates widely depending on the weather, how much snow it was in winter, rainfall and so on. But this is only one aspect of the issue. The problem we have is that all investors have invested money in the sector – 7 billion; It is probably the only sector of the economy that attracted the largest amount of money and once the money was invested, the whole system has changed. Who has invested so much? Romania needs big companies, as well as continued investment in all areas of the energy sector: networks, other types of power plants, oil and gas production. When you have such an experience, you are prompted to continue investments. This confidence must be restored explained Stab.

Those large projects raises many questions. First, we need them? We have different points of view in this regard – many are not convinced that these projects are needed. Then, since we are talking of very large projects, we are talking huge investment. And again, who will take these huge risks, for example Cernavoda – six or seven billion just for this project – if you can not guarantee any return. When we talk of a nuclear power plant practically be administered for more than 100 years, taking into account the decommissioning at the end: almost 10 years for construction, operation 40-50 years and then 40 years to decommission.

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