Romania's center-left government on Tuesday adopted a decree cutting incentives to renewable energy producers, which experts say will deter investment in a booming industry.
Romania
's
center-left government on Tuesday adopted a decree cutting incentives to
renewable energy producers, which experts say will deter investment in a
booming industry.
The order stipulates that wind, solar and small hydro-power producers will only
get around half of the "green certificates" they are entitled to
receive as a stimulus to develop clean energy and will have to wait until 2017
or 2018 to get the balance.
Analysts say the decree, due to come into force on July 1, will deprive
producers of hundreds of millions of dollars in revenues.
"We had to find a compromise allowing investors in renewable energy to
continue to make profits but not to the detriment of the other industries or of
households," Prime Minister Victor Ponta said after a cabinet meeting.
Energy Minister Constantin Nita recently said that
Romania
's
"current incentive scheme is the most generous in the European Union and
has had a negative impact on households and industrial consumers" in terms
of electricity prices.
Under the scheme, conventional energy producers and distributors have to
purchase "green certificates" from renewable energy producers,
passing on the costs to consumers.
Nita stressed that major companies such as steel-maker Arcelor Mittal or
aluminium producer Alro, owned by
Russia
's
Vimetco, "no longer agree to contribute to the well-being of green energy
producers" and are threatening to leave
Romania
.
Romania
enjoys a privileged position on
Europe
's
wind map, with a potential estimated at 14,000 megawatts.
It currently produces 2,100 megawatts of wind power.
Solar power plants have also mushroomed over the past two years. Their capacity
currently stands at 200 megawatts and could reach 350 to 450 megawatts by the
end of the year.
Investment in green energy projects has topped $4.0 billion since 2010.
"But rumours of the government's plans to change legislation which have
been circulating over the past few months have dampened the investors'
enthusiasm" and many of them are mulling abandoning investment projects in
Romania, the president of Romania's Wind Energy Association Ionel David told
AFP.
German company E.ON has said it would no longer build a 120-megawatt wind-power
farm in eastern
Romania
if
authorities decided to cut incentives.
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