Business Review

In the light of the fall in industrial companies' electricity consumption, energy producers are shifting the focus to smaller customers, hoping to pick up some new clients. This could imply that the current economic context is a good reason to bargain down electricity prices. But large consumers say that prices are instead likely to increase, as energy producers have not put electricity for 2010 up for sale, arguing that the imminent establishment of the two state energy companies is likely to send energy prices soaring.

Despite months of discussions and scenarios, the creation of the two state energy companies is far from a fait accompli. State officials disagree on the type of management for the companies, the people in charge, the Bucharest Stock Exchange listing, the Property Fund's stake in these companies and what will happen with the ongoing contracts of the firms that will form the state-controlled energy giants.
By Dana Ciuraru

Czech energy company CEZ is in discussions to acquire full stakes in CEZ Distributie and CEZ Vanzare, both part of the former Electrica Oltenia. On the other side of the negotiation table are state-controlled Property Fund and Electrica. So far, CEZ is said to be ready to pay about EUR 10.70 per share, more than double the price paid in 2005 for Electrica Oltenia. Full ownership would cost CEZ about EUR 375 million.
By Dana Ciuraru

With no definite action on the Nabucco project, Romania has said that it has not ruled out participating in rival projects. After the Romanian economy minister Adriean Videanu's visit to Moscow, Romania committed to supplying Russia with technical data for the South Stream project. Russia passed on the country's proposal to import Russian gas without intermediaries and said it would analyze the possibility of investing in the gas deposit in Roman-Margineni.

Wind Power Energy (WPE) has wind farm projects totaling 1,900 MW. Sebastian Enache, director at WPE, exclusively told Business Review that his company has completed the first wind farm in a mountain area, in Toplet, Caras-Sebes county, and plans to finish another three or four projects by the end of the year. According to him, WPE is in the testing phase with the first national dispatch for wind farms, while the first such site in the country to use new turbines is under way.

Former Distrigaz Sud, GDF SUEZ Energy Romania plans to start some cutting -costs measures, targeting reduced staff and investments lower by 25 percent during 2009, according to the company's officials. The total amount of investments will reach some EUR 50 million in 2009m including the cut of the announced 25 percent cut down. Last year, the company received the authorization for providing power energy and represents the first strategic step for the company's offer to its clients. So far, the company targets clients from industrial segment.

About 17,500 MW worth of wind farm projects are sitting in the Romanians authorities' in-tray, while the national grid for wind energy is connected to just 1,500 MW. The projects could whistle up over EUR 1 billions of investments and jobs for local communities, especially in the Dobrogea region, an epicenter for the wind energy business. But the authorities declare themselves incapable of dealing with the schemes. Year after year only a few projects are authorized to connect to the national energy transportation system. Who are the lucky ones?

The bigwigs of the Economy Ministry see another future for the national energy company (CNE). Minister Adriean Videanu has announced he is abandoning the formation of a national energy company approved in October last year, and now plans to form two or even four national energy companies. The big change: Nuclearelectrica, Romgaz and Electrica will not be include in the ministry's new plans. According to Videanu, the new firms should become operational in October, when the presidential election takes place and things are about to change again.

The current economic situation is leaving its mark on the bilateral contracts energy market overseen by OPCOM, with none inked since the beginning of the year. Up until now only Electrica and Rovinari Energy Complex have made offers on this market, but they were annulled due to warranties issues. OPCOM officials told Business Review that the two main effects of the economic climate on the market were an increase in short-term trading and lower energy prices.

Romania's largest oil and gas company, Petrom, controlled by Austrian oil and gas company OMV, has announced that it will lay off some 3,000 employees starting February 1.According to Petrom officials, the job losses are part of a more extensive restructuring program started by the company at the time of its privatization and are not linked with the current economic situation. The company agreed to pay 15 months' salary as compensation to the laid off staff.