Continental Wind Partners and Valorem Energie are just a few of the names on the list of investors ready to bet billion of euros on the potential of the local wind energy sector. Big players such as Enel, CEZ, E.ON and Gas de France are hunting all the important projects announced in Romania. But investors are flagging up some of the deficiencies of the local market: the low capacity of the national energy transportation system and the one-year only guarantee for the purchase tariffs resulting in limited possibilities for independent green electricity producers to access the market.

Big players, big projects

Continental Wind Partners (CWP) and Swedish businessman Emanuel Muntmark have plans to develop local wind farms of approximately 1,000 MW. The company has three teams working on three different projects in the production of renewable energy: one in the west of the country, one in the center of Romania and one in Dobrogea.
Adam de Sola Pool, chief executive at CWP, told Business Review that for the first two he expects to obtain all permits and authorizations by next year, while for the one in Dobrogea the company already has the Romanian authority’s approvals. The Dobrogea wind farm reaches a capacity of 345 MW, meaning half the capacity of the nuclear reactor at the Cernavoda power plant. Good Energies, an investor in renewable energy and energy efficiency working with CWP, has placed an order for 375 MW of GE Energy’s latest 2.5xl wind turbine technology. The contract is valued at over EUR 400 million and delivery will commence in the spring of 2009. Up to 150 of GE’s 2.5 MW machines will be provided to companies controlled by Good Energies and Continental Wind for installation principally in Romania and Poland, where the company also has investments in green energy.
“We estimate that we will complete the financial aspects of the project by August this year. We are now in talks with several international banks present on the local market. For this project the cost per one MW of renewable energy produced reaches EUR 1.5 million (more than market estimations). So the costs for the Dobrogea project exceed half a million euros,” said de Sola Pool.
According to market sources, this kind of large capacity wind power plants are interesting for important players on the energy market such as CEZ (Czech Republic), E.ON (Germany), Gaz de France (France) or Enel (Italy).
The latest transactions of this kind involved Italian-based Enel, which bought Blue Line and won the right to build a 200 MW wind farm in Dobrogea, as well as Spanish-based Iberdrola, which paid around EUR 300 million for projects that generate 1,600 MW.
Meanwhile, Broker Cluj announced that it would invest EUR 7 million to enter the energy market by developing wind farms and hydro power plants, according to Petru Prunea, president of the company. “The wind park will consist of five turbines and will be built in the Tihuta area,” he said.
The CWP representative says Romania is a very good country in which to invest in all kind of renewable energies, but there is an Achilles’ heel in this business. “A draft regarding the aid for renewable energy investments is under discussion in parliament. This draft need to be formally adopted so that investors will know what they are dealing with and we will have to see if it will be applicable after 2012,” said de Sola Pool.

French recipe for local market

Valorem Energie is one of the main independent RES (Renewable Energy Systems) producers in France and has plans to expand its activities in Romania. The company is considering the opening of an office in Romania in the coming months, but this decision depends on other local projects.
“We are currently developing wind farms in several areas in Romania and are interested in studying other opportunities of acquiring new projects at various stages of development or identifying new sites for new wind farms that we would like to develop by establishing partnerships with Romanian wind farm developers,” Anka Zaion-Cicovski, international development responsible at Valorem Energie, told Business Review. According to her, the capacity of Valorem projects in Romania reaches 115 MW. Company representatives says that the local market offers good opportunities for investments in renewable energy, a fact also seen in the financial results.
“The revenues that Valorem expects from the projects developed in Romania derive from the production forecasts – the wind potential in Romania is quite good and Valorem experts are working with local experts in order to confirm the energy production estimation: we think that we will be able to operate our wind farms by the end of 2010,” said Zaion-Cicovski.
There is one factor, according to her, that delays foreign investments in the RES field in Romania. “Here the purchasing tariffs are guaranteed only for one year, thus limiting the possibility for independent green electricity producers to access the market: the risk perceived by our financial partners is higher and this makes the project financing more complicated in Romania compared to other countries such as France or Germany where the feed-in tariffs are fixed for at least 12 years,” said Zaion-Cicovski. She added that “the Romanian government has chosen to attract mainly big investors, through this policy instrument adopted in order to achieve the E-RES targets, meaning feed-in tariff system plus quota obligation system.”

Transelectrica makes place for green energy

One other thing that has to be taken into account when developing a renewable energy project is the national energy transportation system’s capacity. “In the short run Transelectrica representatives have said that they have an ability to transport green energy of just 1,500 MW. But I think that over ten years Transelectrica will be able to carry thousands of MW,” says de Sola Pool.
The national energy transportation company, Transelectrica, has announced that it will invest EUR 10 million in an energy transformation station in order to connect to the transportation network several wind turbines with a capacity of 600 MW. The total investment reaches EUR 900 million. The rest of the financing will be covered by Monsson Alma from Constanta, a company run by Emanuel Muntmark.
Even so these investments cover just part of the necessary sum and Transelectrica will have to find a place on the network for all the green energy.

Enel Green Power’s new wind park in Dobrogea area of Romania has become functional and will produce an estimated 85.5 million KWh a year. The Salbatica Wind Park, located near Tulcea, in North Dobrogea, will cover the power demand of 29.000 households.
Salbatica wind park joins the Agighiol Wind Farm, opened by Enel Green Power in Romania last December. With a total installed capacity of 64 MW, the two plants will generate more than 180 million kWh per year, meeting the needs of 64,000 households and saving about 120, 000 metric tons in CO2 emissions.
The Enel Group, which has been operating in Romania since 2005, has 5,000 employees in the country and a 93,000 km network that serves around 2.6 million customers.

2010 – Constanta wind farm goes on-line / to be largest on-shore investment of its kind in Europe
Nine O’Clock June 22, 2010
By Monica Apostol

The largest wind farm in Europe, on the Romanian shore of the Black Sea, started to generate power from sustainable sources, a success for the American company Continental Wind Partners (CWP) after five years of hard work, aimed at reducing their reliance on coal and at reaching European targets in terms of sustainable energy, according to a press release remitted to our editing office.

The wind park in Fantanele, situated at approximately 50 km from Constanta, the largest harbour and a tourist site in Romania, is now bound to the national power network, managed by Transelectrica. The five wind turbines are already generating energy, and others are to start running in the following months. Of the total of 139 turbines, 114 are already put on. Another 101 turbines are to be built nearby, at Cogealac. “The implementation of this project brought Romania closer to EU standards,” Mark Crandall, the president of CWP, stated. “It is also a confidence vote for the local investment climate.”

Developed and managed by CWP, the wind farm in Constanta County will be the largest terrestrial investment of its kind in Europe, boasting a 600 MW-capacity the moment the project is completed. Construction works started at the end of 2008. Power company CEZ ensured the funding of the project, while benefiting from assistance in building and equipment from EnergoBit, Viarom, GE Wind Energy, Areva and Emon, The Romanian partner, Monsson Alma, collaborated with CWP in the development and management of the project. The moment it is completed, total investment will amount to EUR 1.1 bln, representing the biggest direct foreign investment in Romania.

CEZ Wind Farm starts to deliver energy to national grid
Business Review – 2008

CEZ Group is building in Dobrogea the largest onshore wind farm in Europe, with a total capacity of 600 MW, approximately double the size of of the largest current operational wind farm in Europe, which is in Whitelee, Scotland. The first stage of the Fantanele project will become operational by the end of 2010, and the second stage, in Cogealac, is expected to be finished in 2011. The CEZ Group’s total investment in the project will reach EUR 1.1 billion.

More than 100 of the total 240 turbines to be built in Fantanele and Cogealac are already fully constructed, and the installation works are continuing on a daily basis. In parallel with the construction works, the already built wind turbines will keep being tested and put into operation, with CEZ estimating that by the end of 2010 all 139 turbines of the Fantanele stage of the project will be producing and delivering green energy to the national grid.