July 9, 2013

Italian Investors Urge Predictability on Romanian Renewable Market

In response to the government’s decision to amend the renewable energy law to reduce the incentives granted to producers, Italian investors active locally have voiced their concern regarding the unclear legal framework that threatens the investment future of the local renewable sector, during a conference organized last week by the Italian Chamber of Commerce for Romania (CCIPR) in partnership with Confindustria Romania.

Roberto Scagnoli, CCIPR president, said the bill that changes the renewable support scheme concerns investors because it “lacks clarity”. Italian companies have invested heavily in renewable installations, mainly solar and wind. Companies will now be forced to redesign their business plans, as the authorities have deferred the issuing of some green certificates, which account for most of a renewable project’s revenues.

Wind producers will have to manage with one certificate until January 2018, when they should get back the deferred one. Meanwhile, solar producers will recover their certificates from April 2017, and will be granted only four until then.

“The signal I have received from all investors is that they require certainty from the regulations in the mid and long term,” said Diego Brasioli, the Italian Ambassador in Bucharest.

The local renewable sector has attracted investments of EUR 3 billion in recent years, according to Mauro Maria Angelini, president of Confindustria Romania, an association of Italian companies active locally.
Renewable reduction sparks confusion

The government has suspended the issuance of one green certificate for wind farms and small-hydro power plans and two for photovoltaic farms until March 31, 2017. This move comes after months of intense lobbying from the large industrial consumers, say commentators. Big industry representatives argued that they had to pay more for electricity due to the renewable incentives, which dents their competitiveness and puts domestic jobs on the line.

Photovoltaic farms built on agricultural land will be ineligible for the support system if investors do not remove them from the agricultural circuit by July 1, when the bill is enforced.

However, the solar parks that are in different building stages will not be impacted by this ban, as they still have time to change the designation of the land before they receive accreditation from the energy regulator ANRE, according to Silvia Vlasceanu, parliamentary adviser in the Industry and Services Committee in Parliament. She added that this provision applies only to operational solar producers, whose farms are still on agricultural land.

“It would be very hard to enforce the bill from July 1. We don’t know how Transelectrica will delay the green certificates because it doesn’t have the secondary legislation,” said Vlasceanu.

Parliament has delayed a vote on the law approving the changes to the renewable legislation until September as MPs need more time to debate the bill. In addition, the Competition Council said that the bill could be enforced only after the European Commission was informed.

Otilia Marin, general director of ANRE, commented that the renewable output would cover between 11 and 13 percent of Romania’s electricity consumption this year, below the mandatory quota of 14 percent, according to recent estimates. This means the green certificates will continue to trade at higher levels, until the yearly quota is met.

Close to 2,100MW of wind capacities were operational in the energy system by April, accounting for 9 percent of total generating capacities, according to grid operator Transelectrica. Biomass and solar made up 40MW and 94MW, respectively.

No comments:

Post a Comment