The support scheme that institutes an exemption from the payment of green certificates (GCs) in various percentages is implementing the European Commission guidelines for renewable sector that acknowledges the potential distortions such RES subsidies can create, says The Association of the Big Industrial Energy Consumers (ABIEC).
„ABIEC reiterates that the exemption of industrial companies from a fraction of the overcharges on electricity supports the competiveness of the Romanian industry, its position at international level and over 1.5 million jobs at local level. The exemptions comes into a larger EU context aimed at supporting the industry across Europe and acknowledging that all countries in the EU are taking conscious actions towards strengthening their own industries, including developed countries such as Germany and France”, ABIEC says in a press release received by energynomics.ro.
The decision to relieve industrial companies from part of the green energy charges comes as an acknowledgment of the fact that economic growth could not be generated in absence of manufacturing industry. This is a vital step to support the Romanian industry, which creates added value, drives the exports and is responsible for economic growth.
The European Commission acknowledged that “charges levied for the funding of renewable energy support make up an increasing proportion of the energy bill for industry. This constitutes a very high burden for some energy intensive companies, in particular those exposed to strong international competition”.
Exemptions up to a maximum of 85%
Based on the EU Guidelines, the Romanian authorities implemented a scheme to reduce the surcharges with green certificates for industrial companies, depending on their consumption specifics, by a maximum of 85%.
The exempted companies have to meet very clear criteria. Specifically, the industrial energy consumers who receive an exemption from the aid given to the renewable energy producers don’t have unpaid debts to the state budget, implement measures to increase energy efficiency, maintain the workforce, have partnerships with education institution to support the qualification of personnel and future personnel.
This exemption scheme – already implemented at EU level – was even more necessary for the companies operating in Romania. The green energy sector grew heavily over the past years, Romania managing to meet, six years in advance, the target of 20% of its energy coming from renewable sources. As a result, the support scheme for the renewable energy impacted the overall costs with the energy that reached an unbearable level for the industrial consumers in Romania.
The uncontrolled increase of the subsidies for the renewable energy led to an increase in overall taxes paid by all consumers by 30% yoy. Such an increase would have left the Romanian companies outside the competiveness area and would have resulted in a decrease in industrial activity. Distortions like this are specifically addressed by the EU Guidelines ever since 2014.
This is a direct commitment of all countries within the EU to allow industrial companies to develop and remain competitive, without having to heavily support private companies, in the renewable energy sector. ABIEC notes that the exemption is, in fact, a reduction of a tax with no effect whatsoever on the state budget, as the support scheme finances private companies who invest in renewable energy.
As previously stated, ABIEC members consider that the exemption costs should not be passed over the individual consumers. The Association of the Big Industrial Energy Consumers includes the biggest energy consumers in Romania, such as Alro Slatina, ArcelorMittal Romania, Lafarge Romania, Tenaris and Saint Gobain who have a combined electricity consumption of approximately 10% of the total electricity consumption of Romania.
These companies directly employ a total of over 30,000 people, and are indirectly responsible for another 170,000 jobs in the contracting companies. The founding members pay yearly over 130 million EUR to the state budget and local budgets, have total exports of over EUR 1.3 billion and made investments which exceed EUR 1.5 billion in Romania, having long-term development strategies for their local businesses.
