Romania Could Save Up To EUR7B By Improving Energy Efficiency

03.15.2013 By Roxana Petrescu

Romania could save between EUR4.8 billion and EUR7.4 billion by improving energy efficiency until 2020.

To do it, it would need investments of EUR6.4 billion in the energy generation, transmission and distribution system and at end-consumers, where it could save about EUR3 billion, according to research by consultant PricewaterhouseCoopers and expert statements.

“There are significant losses on the power distribution segment and gas network, as high as 16% of the total energy generated. This makes EUR4.8 billion to EUR7.4 billion that could be saved and circulated into the economy,” said Bogdan Belciu, management advisory services partner with PwC Romania.

“With end-consumers it’s about EUR2 billion or EUR3 billion that could be put back into consumption.”

The consultant, along with ABB, Alstom, Dalkia, Elcomex IEA, EnergoBit, GDF Suez Energy Romania, Lafarge Romania and OMV Petrom (SNP.RO) have recently formed the Romanian Association for Energy Efficiency Promotion (ARPEE).

But to achieve such savings, substantial investment is needed first. ARPEE members’ solution is the European Union funds, but Romania has hardly been successful at drawing them so far, considering it was only able to absorb EUR7 billion of the EUR30 billion available in 2007-2013.

“We don’t have an estimate of the amount needed to enable such savings. It’s a complex problem. It’s a long list,” PwC official said.

Virgil Musatescu, a professor with the Polytechnic University of Bucharest and member of the World Energy Council provided an estimate. “The investments to attain our target by 2020 should amount to about EUR6.4 billion according to existing research.”

Energy efficiency improvement would save almost EUR1.7 billion to EUR3 billion on the electricity generation segment, and EUR1 billion to EUR1.3 billion on the power and gas transmission and distribution sectors.

While transmission systems are still state-owned and in the hands of two monopolies, Transelectrica (TEL.RO) and Transgaz (TGN.RO), the electricity and gas distribution sector has been almost completely privatized since 2005.

‘I can’t tell how much they should invest in electricity networks, because we don’t deal in that, but we invest about EUR50 million a year in our gas operations,” said Razvan Grecu, vice-president with GDF Suez Energy Romania, a company that bought former Distrigaz Sud in 2005 and whose revenue stands at about EUR1 billion.

(English version by Loredana Fratila-Cristescu)