The European Commission said on Tuesdaythat temporary rescue aid of 167 million lei ($40.2 million/37.6 million euro) to be granted by the Romanian authorities to state-owned electricity and heat producerComplexul Energetic Hunedoarais in line with EU state aid rules.
In particular, the Commission found that the aid was limited to the amount necessary to allow the companyto continue operating its power plants in the next six months, after which it will either pay back the aid or Romania will notify a restructuring plan, setting out measures to ensure the company's long-term viability,the Commission said in a statement.
Following losses in 2013 and 2014, CE Hunedoara is facing significant liquidity problems, soRomania will grant it short-term loansto enable it to pay creditors and maintain operating activities until it is able to present a restructuring plan.
The Commission found the measure to be in line with its 2014 guidelines on the rescue and restructuring of companies in difficulties
CE Hunedoara is the legal and economic successor of Termoelectrica and Electrocentrale Deva.After an in-depth investigation opened in 2012, the Commission has concluded in a separate decision that the contracts between Hidrolectrica, Electrocentrale Deva and Termoelectrica gave the latter two an undue economic advantage in breach of EU state aid rules,because Hidroelectrica paid to them electricity prices above market level.
Termoelectrica and Electrocentrale Deva – or now CE Hunedoara as their legal and economic successor – need to pay back the incompatible aid received, which amounts to 26.27 million lei excluding interest. Before receiving the rescue aid, CE Hunedoara will therefore pay back the incompatible state aid granted in the past to Electrocentrale Deva and Termoelectrica, the Commission added.