“We support any form of legal protection as long as the company is rebuilding on sound principles and does not jeopardize the welfare of the citizens. Insolvency means, firstly, paying the invoices up to date,” said the Minister of Energy Victor Grigorescu, in connection with the insolvency of the energy producer RADET.
Passing through the phase of insolvency of RADET Bucharest would clarify the commercial and financial relationship between ELCEN and the heating administration, and this should not affect the heat distribution to the public this winter, said Emil Calotă, ANRE vicepresident.
On Thursday, the ELCEN Board of Directors considered ‘the best solutions to continue the business relationship with RADET and to protect itself, in turn, from the effects of the RADET insolvency, “said the Minister of Energy, in a press release.
“The restructuring measures are not an excuse for non-payment and I’m glad we agreed in the previous weeks, along with the Mayor of Bucharest, the necessity of paying the current invoices. This responsibility lies with local authorities and I expect that they will deliver. I hope this is clearly understood by everyone. The payments to ELCEN are not a fad, but an absolute necessity in order to pay suppliers on time and to produce hot water and heating for the population.”
RADET entering into insolvency could lead to loss of the EU funds that the Bucharest Municipality hoped to modernize the transport networks with. In a Facebook posting, Catalin Deaconescu, a Liberal municipal councilor and former adviser to the Ministry of Energy, believes that the “insolvency request from RADET is the worst solution.” “The saddest is that once this procedure is started, we can say goodbye to the egregious European funds that could help rebuild the transport networks! Although the measure Axis 7.2 was designed especially for Bucharest, we are in a position of competing alone and yet coming up in second place. ”
ELCEN decided to ask for insolvency, too
In a press release issued on Thursday evening, ELCEN announced that it has decided to ask for insolvency. “Given the financial situation of Electrocentrale București SA and given the debts registered to suppliers and distributors of fuel, services and products, a situation generated by the receivables not collected from RADET Bucureşti, and taking into account the decision of the Board of Directors of RADET, the Board of Directors of ELCEN decided today to submit a request to the Bucharest Tribunal for the company to enter into insolvency,” ELCEN informed.
Meanwhile, ELCEN announced that the capital’s heat supply will not be affected this winter, even if ELCEN and RADET enter into insolvency, as long as there is a coordination between ELCEN, RADET and the City Hall.
Dan Agrişan, member of the Board of Directors of Electrocentrale Bucuresti (ELCEN) said, before of Thursday’s afternoon decision, that “ELCEN not entering into insolvency would put the company in a worse situation than if it enters”.
He explained what it would mean for ELCEN entering into insolvency.
“A temporary protection on the debt from the past is desired and an obligation to be very fair and accurate information regarding the payment of the current debts and a possible reorganization in the future. Pretty much it depends on how we synchronize with RADET and the City hall, there is a strained relationship. We are dependent on each other, we are aware of this, we do not want to die together, but to provide heat and hot water for Bucharest. So, it is essential having good coordination and good communication between us, even though we are on opposite ends, “said Dan Agrişan.
Asked if the current situation could threaten the supply of heat this winter for residents of the Capital, Agrişan argued that this depends on how will all the actors the in the chain of production and supply of heat will coordinate.
D. Agrişan: The thermal energy supply will not be affected
“The risk that the supply is threatened is here year after year, but it all depends on us. I do not see a big risk at the moment, if we coordinate with the mayor and RADET. I am convinced that they will assume that we have possibilities for energy. I do not think there will be problems, solutions exist from their side. I have not seen any desire to leave the responsibility on others, “said the ELCEN representative.
The RADET leadership was mandated Wednesday to open the insolvency proceedings, after draft resolution in this effect was adopted at the Bucharest General Council meeting (General Council).
The Independent Administration for Thermal Energy Distribution (RADET) has a historical debt of 3.9 billion lei to Electrocentrale Bucuresti (ELCEN), the main producer of heat and hot water for the capital. Because of these debts accumulated by RADET, ELCEN in its turn has accumulated debts worth about 1.8 billion lei.
