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Romania has been through a reasonably steady economic development since the fall of the "iron curtain" and whereas a continued GDP growth is expected a slight growth in energy consumption is also expected for the short- to midterm outlook, in spite of a minor expected fall in the total population during the same period.

Romania has been a net exporter of electricity for a number of years. The total production capacity was approximately 54TWh in 2010 and is expected to grow to around 60TWh in 2015, whereas the total energy consumption was only approximately 50TWh in 2010 and is expected to rise to around 53TWh in 2015.

The steady growth in production capacity which was seen from 2000-2008 took a hit during the financial crisis. However, a number of upcoming projects, new legislation giving some clarity to the legal framework needed for new projects and an expected come back of the financial markets makes the market believe that we will again see an increase in capacity in the short- to midterm outlook. However, it should be noted that the Romanian economy is still fragile and various regulatory impediments and red tape still create a downward risk for the short- to midterm outlook.

Romania has a fairly diversified power mix today. Traditional coal, oil and gas fired power plants make up for about 50% of today's generation capacity whereas the remaining capacity come primarily from hydropower and nuclear power.

Whereas the EU, through EBRD, has provided financial support for the renovation of the large 2.3 GW Turceni thermal power plant, the Czech utility company CEZ decided to pull out of the 400 MW Galati gas fired power plant project in July 2010 and was followed by GDF Suez, RWE and Ibedrola in January 2011, leaving the Galati project little chance of being realized.

Romania has as many other European countries and in line with the EU requirements set ambitious targets for its renewable energy consumption. The goal for 2010 was that 33% of the electricity consumed should come from renewable energy sources (including nuclear power), and the goal is 38% for 2020. The primary support from legislators towards new capacity is thus targeted to support renewable energy capacity.

As the country does have very favourable conditions for renewable energy production, it does seem obvious to support such investments. However, so far many potential investors and financiers have been hesitant to invest in Romania or simply stayed away due to delays and uncertainty related to the needed legislation, the high level of corruption and the bureaucratic processes involved in applying for the needed permits and authorisations.

Whereas the country has already taken advantage of the opportunities for large scale hydropower projects, the potential for small scale hydropower projects largely untapped. Romania further has significant geothermal and biomass resources which are today primarily used for heating rather than electricity production.

With a solar influx 1,000-1,300 kWh/m2 p.a. the potential for solar PV capacity is evaluated to be minimum 1.2 TWh p.a..

However, the by far most promising resource comes from wind energy. With the wind regime found in not the least the eastern areas of the country, the wind energy potential is estimated to be around 23 TWh p.a.. The Romanian wind energy association also hopes to achieve 5 GW of installed capacity by 2020, a goal which seems within reach with the already known projects and project pipelines from, among others, CEZ, Enel, Energias de Portugal and RWE.

It seems fair to conclude that almost no matter what form of renewable energy that may have your interest, it may be worthwhile your time to keep an eye out for Romania in the years to come.

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