This is the transcript of the message delivered by Frank Hajdinjak, CEO at E.ON Romania, on the occasion of Energy Strategy Summit, event organized in June 4 at Cantacuzino Palace, in Bușteni.

It’s my first time here since I am in Romania; it is a beautiful place, very nice, thank you for the invitation. If you look worldwide, the energy market is changing rapidly at an amazing speed, a speed which we had never seen in this sector and I don’t think we have yet made our homework, for Romania to face the challenges, which we have to address to these changes that are coming, we have to define for Romania what is the right energy mix for the future, which kind of generation capacities we want to have, which mix do we want to have; we have to incentivize these investments and the same applies for the great business. We are present in Romania in gas and electricity distribution and sales business, and we invested over the last 10 years, since we came in Romania, more than 1.3 billion euros into the grid.

Looking at the status of the grid, there is still a long way to go in order to bring the grid to a level which is comparable to, let’s say, west European standards and Romania also has to make a decision here: which kind of networks do we have or do we want to have in the future? The world is developing into smart grids and additional installations for the customer at home, smart home installations for example, but this has a price and Romania has to a make decision; do we want to have high quality grids and do we want to have smart grids? What are the implications? In addition, we see that there is quite a significant challenge coming from the EU in order to look up on the environment, and this will also involve or have certain implications in the future landscape of Romanian energy sector.

So we have to answer these questions. We believe that Romania has got very good perspectives for the future development, we got all sorts of resources available on the electricity side, but do we want to set the incentives for future big investments?

This also means, for the investors, that we have to create the right environment, we as E.ON, believe we should definitely set also a big focus on the decentralized energy world. Europe is developing towards decentralized generation, meaning that we are developing to a role of consumer (household or public buildings and institutions) with production facilities.

We will see that we have small sized production facilities there and that will change the landscape of the generation and the grid business significantly in Romania and I think it is also the right answer to the questions which we have to also answer: how do we make energy affordable? We have to invest also in energy efficiency; this will be one of the means which will help us to reduce the cost of our customers. Gas and energy consumption will decline, and energy efficiency will be one of the answers to cope with the reduction of the energy bill for the final customers.

If we look right now, we have an energy efficiency law which looks more like an energy efficiency avoidance law. There are many things missing and I think first we should look on the primal legislation, to get to group this lot, to come to build a proper energy efficiency environment to be able to investment in this area. Romania has to access significant funds in this area from the E.U. and therefore we have to do proper the secondary legislation.

I’d also like to say a few words about the gas market liberalization. I think it was yesterday it was announced in the calendar. We will have starting from the 1st of July an increase of 60 lei per MWh. Of course this will have an impact on the energy and gas bill for our consumers and again here, energy efficiency measures are one answer to this increasing bill for our customers.

At the same time the energy policy has to be combined with a proper industry policy in order to force the investments into the industrial development of Romania, so that we can have better workplaces and also develop the whole industry sector in Romania. What we need for this and I’ve been praying for the last 10 years, is a predictable and stable environment and unfortunately not all measures which we’ve seen over the last years were predictable.