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Electrica exiting two wind energy projects

Published

August 20, 2015

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Published:

August 20, 2015

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Citing declining profitability of renewable energy, Romanian utility revealed a plan to terminate the development of two wind parks, which is reflected by financial statements by the management, Business-Review reported.

Electrica SA was listed on markets in Bucharest and London in July last year, and made a decision at the time to postpone investment in green power, after a recommendation by the privatization consortium, the report said. The state has a share of 47.48% in the electrical energy producer and distributor, while the European Bank for Reconstruction and Development follows with 8.66%. The company introduced three aeolic power projects five years ago, but gave up on one in the meantime.

According to Mediafax news agency, both remaining endeavours are ready for construction and Electrica is considering outsourcing them due to adverse changes in the renewable sources regime, because of its focus on distribution, and the limited synergy between the two activities. Estimated investments in the 45 MW wind farm at Frumuşiţa in Galaţi county are RON 308.25 million (EUR 68.5 million), while overall funds needed for the 48 MW project at Chirnogeni in Constanţa county are about EUR 90.5 million. The company spent EUR 1.89 million and EUR 0.94 million so far, respectively. Annual investment plan at the group level for this year is EUR 194.37 million. Electrica is counting on a turnover of EUR 1.28 billion and a net profit of EUR 104.06 million. In 2014, Electrica recorded sales of EUR 1.14 billion and a net profit of 90.72 million, of which EUR 65.06 million is net income, attributable to shareholders. The utility has decided to lay off over 800 employees from its subsidiaries, aiming to increase productivity, according to Romania-Insider. At the end of last year, Electrica had 11,740 employees.

Electrica covers three regions in distribution and supply: Transilvania Nord, Transilvania Sud and Muntenia Nord, and has a national presence in maintenance and energy services. The company serves 3.5 million customers.

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