Romanian companies are looking for suppliers capable of providing them with a fixed or clearly determinable price, for periods of up to ten years, Renovatio announces in a press release. The new trend observed by one of the main players in the field of solar energy and green technology takes shape in the context of unprecedented energy prices in recent years.
Renovatio also announces that it has already signed such multi-year contracts, with a standard duration of 10 years and fixed prices, with more than 50 customers in the corporate area and large local entrepreneurs. The process of negotiating and signing new contracts continues, Renovatio adds.
“Companies that are interested can get rid of price fluctuations, plan for the medium or long term, and lower their overhead costs of renegotiating contracts yearly or even more often in some cases”, said Doru Voicu, Director of Strategy within Renovation.
All of the more than 50 signed contracts are partially or totally allocated to a producer of energy from renewable sources, located in the Renovatio portfolio, usually from solar or wind.
An important element in the profile of the company that signs a long-term contract is, according to Doru, a consistent share of energy expenses in the cost structure. ” On top of that, the ESG policy is put in place, and companies with monthly consumptions of over 1,000 MWh are most interested”, said the Director of Strategy from Renovatio.
According to the latest available data, published in September 2023, by OPCOM, the operator of the electricity and natural gas market in Romania, the average closing price of the market was 3.6 times lower than that of the similar period last year, the press release states. Thus, in September 2023, on the spot market (Day-Ahead Market), energy cost 512.07 lei/MWh, while in September 2022 it was 1,854.94 lei/MWh. “Also, it is important to mention that the average closing price in September is increasing, a trend that has reversed since June. In June, the average price was around 422 lei/MW, in July, it rose to 478 lei and then to 502 lei in August. In the first half of this year, prices had started to fall, after the unprecedented increases of recent years.”
With the start of the conflict in Israel, internationally, prices began to skyrocket again. “In a few days, increases of approximately 20 euros/MWh were recorded for almost all electricity products, while the price for natural gas rose by more than 15 euros/MWh. This evolution shows us that we are still in a period with risks of massive price volatility”, Doru Voicu also pointed out.
“The prices at which we sell energy for 10 years are certainly lower than the spot prices at this moment, and the contracts we sign are not speculative. Anyone trying to sign such a contract and thinking of they will ‘beat’ the market will probably not reach a reasonable compromise and in fact will not conclude a contract. This kind of approach comes from people who do not understand the role of such a contract,” added the Renovatio representative.
Renovatio has over 18 years of experience in the energy sector and is an integrated player. Its activities largely cover the renewable energy value chain (wind, photovoltaic and hydro), from the development and commercial operation of renewable energy projects to the supply of green energy to end customers and the implementation of energy efficiency and storage projects. Renovatio runs projects in countries such as Romania, Portugal and Colombia and has also been active in markets such as Poland, Bulgaria, Greece, Moldova and Italy. Renovatio e-charge also operates the first and largest network of charging stations for electric vehicles in Romania, which currently includes more than 655 charging points nationwide.