Solar Projects Offer Bright Outlook in Romania
- May 10, 2013
Conergy, the Hamburg-based energy company, is expanding its footprint in Romania with the development of a 2- megawatt solar power plant in the Slobozia region. Currently under construction on a 10-acre site, the facility will include over 8,000 Conergy modules fabricated in Germany.
Upon completion, the plant is expected to generate more than 2,700 megawatt hours of electricity annually, enough energy to power about 770 households. Furthermore, the project will reduce carbon dioxide emissions by 1,400 tons annually.
The Slobozia solar project is the second announced in Romania this year by Conergy. In January, the company announced a 2.2-megawatt solar plant in Bobiceşti near the town of Craiova (pictured). The company is teaming up with Solanna Investment S.r.l. to develop the plant, which is expected to generate about 2,840 megawatt-hours annually.
“Currently, Romania is covering around two thirds of its electricity demand by power generated in the country itself,” said Alexander Gorski, a member of Conergy’s board. “Large-scale solar power plants will be playing an increasingly important role in helping to enable the country to also satisfy the rapidly rising demand for electricity in the future. We intend to expand our business in this segment further in the years to come.”
Conergy’s solar park will become profitable thanks to a quota model that employs so-called green certificates and power purchase agreements, the company said. Unlike other European countries, Romania does not offer feed-in tariffs as subsidies for solar power projects. Instead, the state requires energy providers and energy-intensive businesses to obtain 14 percent of their electricity from renewable sources. That share will rise by 1 percent annually through the decade and reach 19.5 percent by 2019. For this purpose, energy providers need a certain number of green certificates.
Providers that fall short of the threshold must purchase the emission certificates for 110 euros each to make up the difference. Power plants with a total capacity of 10 megawatts currently earn six certificates for each renewable megawatt-hour generated over the subsequent 15 years. Starting next year, plants will receive only three certificates per renewable megawatt-hour. Conergy’s plant will receive an estimated 16,200 green certificates annually for producing 2,700 megawatt-hours, or about 243,000 over 15 years.
Until 2025, prices for certificates traded on the market will remain in a fixed range between 27 and 55 euros. Any certificates that remain unsold in a given year will be purchased at the fixed minimum price by the national energy regulation authority, known by the acronym ANRE. Power plant operators earn revenue from sales of both electricity and green certificates. For the Conergy plant, the sale of green certificates could yield 6.6 million to 13.4 million euros over 15 years.