Wind turbines in Romania are expected to reach a capacity of 1.5 GW in 2012, surpassing the 1.4 GW capacity of the Cernavodă nuclear power plant. Investments in wind power in Romania could total €1.5 billion in 2012, doubling capacity from 2011. While wind turbine equipment prices are decreasing as the market grows more competitive, financial institutions are still reluctant to provide loans for unproven cheaper Chinese turbine brands in Romania.

1. News December 29th, 2011
Wind turbines will produce as
the power plant in Cernavodă
In 2012, if everything goes by the book, the wind turbines capacity in
Romania will reach 1.5 GW whilst having 1.4 GW in Cernavodă NPP.
Wind turbines will reach in 2012, if all goes well, to have a capacity of 1.5 GW, more than power
plant in Cernavodă, which has about 1.4 GW. In 2011, due to drought, they have got a strategic
importance producing in some periods more than Hidroelectrica. Investment could total in 2012 to
€1.5 billion and the total capacity will increase to almost 1.6 GW, double the 2011, according to
Dana Duică, Executive director of the Romanian Association for Wind Energy (RWEA).
"In 2012, we expect investment that can reach up to €1.5 billion, an optimistic scenario in which the
companies will carry their announced plans out successfully", she says.
In the 800 MW will participate next year projects of major players such Enel, EDP, CEZ and others
smaller, local like Holrom and Monsson. Will be completed next year projects of Verbund, CEZ with
the second part in Cogealac, Enel and Iberdrola. Payback period will remain still about 8 years and
the profit margin required by ANRE, is about 10%.
Eng. Paul Keisch Page 1

2. News December 29th, 2011
Wind turbines this year
Also in 2011, growth was spectacular: from 462 MW in 2010 reached to 850 MW. The growth rate
last year was unprecedented, when the capacity increased from 14 MW to 462 MW. After finalizing
legislation this autumn, the main factor that led to this progress is sustained pace of project
implementation. Basically, in 2011, were built projects started in 2008-2009. In 2011, the area has
been invested around €600 million. The suggested retail price of ANRE for investment is €1.57
million per MW built.
"Only in 2012 we’ll see a decrease in price per MW, mainly due to lower equipment prices.
Remaining costs will remain the most likely as: construction, consulting, etc. About 80% of the
project is the equipment", said Duică.
The turbines get cheaper
Such equipment price decreases as technology advances and market becomes more
competitive. Thus, in addition to established brands, with a considerable market share, such as
Vestas and General Electric, appear new brands, cheaper, usually built in China.
In Romania, currently, there are no installed Chinese wind turbines. These plants, although cheaper,
is much weaker guarantee to an investor who wants to take a bank loan. Financial institutions don’t
provide easy credit for the purchase of equipment that hasn’t been proven, over time, efficiency,
even if it’s cheaper. Basically, banks would prefer to give greater credit for a safer investment than
less money for a less secure one.
Despite some fears in the market, the increase of electricity price for consumers caused by the
scheme to promote renewable energy isn’t significant. According to a study by (PwC)
PricewaterhouseCoopers, the price of 1 MWh will be increased by €6.1 in 2012 and €9.8 in 2013,
amid the state subsidization of renewable energy. Total energy cost, supported by a household in
Romania, these years will increase by €9.8 per year respectively €16.3, i.e. 0.03% - 0.05% of
average net income of the household.
PwC study starts from premises that in the years 2012-2013, average net consumption of a
household in Romania will be 1,600-1,700 KWh, and estimates are based on the final price of energy
available to households in 2010 which is €104 per MWh.
Is there a "bubble" risk in the wind?
"But I don’t see any risk of industry failure in the future, especially since it had a normal and
predictable growth in recent years and this rate will be kept in the future", said Duică.
However, there is a danger in terms of investors, because banks need stability when giving credit to
know what scheme can be placed. Thus, if ANRE is a radical and sudden, many projects are
"trapped" during development, because they were designed after a specific plan. If they were
designed, for example, 2 green certificates for 1 MW and scheme changes to 1.5 green certificates,
funding problems may occur.
Eng. Paul Keisch Page 2

3. News December 29th, 2011
Batteries are the future
A new trend is Batteries that could store wind energy. Yet, a battery system cannot be designed to
store the energy produced by a wind farm. Problem is not money, but of technology. Regardless of
the amount invested, now such a project cannot be made. Wind energy should be consumed on the
spot, and if there is no consumption when is produced then it is lost.
Romania has great potential to have also wind turbines plant (factory), considered Duică. But to see
such unity in Romania, investors should be encouraged. It’d not be difficult, because Romania has
great potential: it has the suitable locations and the necessary technology.
Businessmen, however, were discouraged by legislative instability that was established between
2008 and 2011. If there were 1 or 2 years of legislative stability, investors say they would be
tempted to make such investments.
Eng. Paul Keisch Page 3