Enel: Romania Needs Energy Competition, Not Full Privatization

05.20.2011 By Andrei Circhelan

Romanian authorities need not privatize all energy companies or electricity producers, but the segment needs true competition, Friday said Luca D’Agnese, president of Enel Romania.

"You need not sell everything, don't worry. (…) The experience of other European countries has shown that it takes multiple competitors to form a market. If production is controlled entirely by one competitor, in this case the state, then there's no market," D'Agnese told reporters.

He added the conventional energy production segment, where units are largely state-owned, could use more transparency, achievable through privatizations.

"I don't believe Romania needs to sell all state-owned energy producers.

Throughout Europe, states hold production units or stakes in such units. A piece-by-piece privatization is better, it's a start. Markets are not made over night. Investor confidence is gained through consecutive steps," the Enel official said.

Asked whether Enel would join the privatization of power producers, D'Agnese allowed such a possibility, but added the group prefers greenfield projects.

Enel invested EUR280 million last year in Romania, and it plans to invest a similar sum this year. The bulk of funds, namely 95%, will go to power grids.

In addition, the group has earmarked EUR800 million for investment over the next five years, including 2011.

Enel has been active in Romanian electricity distribution and supply since 2005. The group is also active on the local renewable energy segment, through Enel Green Power.