Romania’s target of having at least 10 GW of new low-carbon renewable energy production units by 2030 is likely to be exceeded given the effervescence in the market and investor appetite, which equates to a new industrial revolution. At the same time, Romania also competes with other countries for investors’ investments, so it will have to carefully exploit its chances and opportunities, said Varinia Radu, founder and managing partner of Energynomics, at the 9th edition of the Energy Strategy Summit.
“Especially in the renewables sector, the appetite has grown significantly and we now see that Romania is on the radar of investors as one of the most active jurisdictions. This effervescence is not unique to Romania – Romania competes with other jurisdictions in attracting and maintaining investment, especially since Romania has an extraordinary natural potential in many of these technologies. Despite these challenges and ongoing policy changes, the energy sector is showing strong signs of optimism, with talk of reforming and modernizing the energy system on a scale akin to a new industrial revolution. This is, without a doubt, a good time to be active in this industry and I trust that Romania will succeed in achieving its transition goals”, said Radu.
In recent years, more than ever, energy has become central to citizens’ lives and an important element in geopolitics and national security, and Europe in particular is leading global efforts to redefine how energy is produced and consumed. The implementation of measures for an accelerated transition to a greener energy mix, together with sustainability objectives, have generated broad support for investments in new low-carbon technologies and sustained implementation of energy efficiency programs.
However, even the renewable energy industry faces challenges including at European level; among these, access to grids has become more difficult and costly as supply chains have become problematic at a global level. This, along with others, will increase the cost of capital and leverage of green power capacity developers.
At the same time, legislative and regulatory changes facilitate or hinder the development of projects. The approval and permitting process is becoming a major delay factor for new developments, especially in protected areas or in congested areas. In this context, it is important for Romania to ensure an integrated, harmonized and attractive legal framework for investors and which does not create additional legal and administrative obstacles in the development process of these energy sources.
On the other hand, new technologies are once again competing for market share, and each type of renewable energy brings with it its own challenges in terms of commercializing production. National policies are adapting to the idea of removing subsidies for renewable energy production in a context where the costs of building renewable capacity are rising again. To ensure the necessary conditions for the development of the sector, the reform of the common energy market is considered essential by the European Commission, but the debate on this subject is far from bringing clarity to the market.
“Despite the fact that instruments such as green bonds are more often used, obtaining financing has become more difficult in attracting private funds because they compete globally to maximize profit. Romania is the second largest country after Poland in the region and in the last three years has taken important steps in implementing the legal framework to ensure the comfort of investors in the sector by aligning it with the common market regime. EU funds or other forms of support, such as Contracts for Difference, increase the attractiveness of the business model for such investments if they are made in good time,” Radu said.
Energy Strategy Summit 2023 was organised by Energynomics with the support of ABB, ASTRASUN Solar, BCR, CEZ Romania, Eaton Electric, Electrica Furnizare, Electro Service RB, Elektra Renewable Support, EnergoBit, Enevo Group, E.ON, Finder, Huawei, MET România Energy, OMV Petrom, OX2 România, Phoenix Contact, Photomate, ProCredit Bank, REI Grup, Renomia Gallagher, Romgaz, Schneider Electric, Signify, Transelectrica, Taw Energy, Volt, WIKA, Wiren, Alexandrion Group, Aqua Carpatica, Klarmedia and Mobexpert.