5 truths regarding the Renewable Energy

On Monday and Tuesday I started explaining to you the real situation in the Romanian Renewable Energy world. In order for us to be serious and analytical, I started with a comparison of Romania with Germany and Bulgaria, two countries that part of the media loves citing, when it is about to criticize Renewable Energy in Romania.

(Germany and Romania: Comparison. Romania and Bulgaria: Comparison)

As you may probably guess, this “hot” subject creates lots of tension, plus negative comments. (What is interesting is that some comments seem to carefully follow the strategy of the interests that are against Renewable Energy, but probably this is a coincidence).

So yesterday I received this comment (translation from Romanian):

“Last winter I paid over 500 Lei for green certificates, cogeneration and excise tax. I am angry and I think that this money was stolen from my pocket. This situation with the green certificates is pure theft. I want cheap electricity and I don’t want to fatten all the thieves in Romania or elsewhere. At this time, we pay the electricity with a higher price than in Germany. In Romania, the consumption at this time is somewhere between 5GWh and 8GWh and probably the consumption will decrease.”

First of all, let me remind you some figures:

• It is at least funny for someone to believe that German consumers pay cheaper energy than the Romanian ones.
• Bulgaria consumes 4.250 MW / hour (4,25 GWh) while Romania consumes almost double. Does anyone here expect for Romania to become… Bulgaria? How? It would be interesting to hear the arguments for this approach.

Let us discuss now about some truths that are related to Renewable Energy and you don’t really hear them often:

1. You are upset with the wrong people

If a trader or utility company does not buy certificates, it pays penalties. Then it charges the consumers these penalties. If they want to buy certificates, they have to buy from the market at high prices and they are not really free to sign long term agreements at much lower prices.

So if we let them free to work properly and to buy certificates at a lower price, they will charge much less as well. Don’t blame Renewable Energy because the law needs improvement.

2. The real cost of conventional energy

Just last week the government gave priority to energy factories so as to inject their energy to the grid. (Check the article here)

As this is not the subject of this article, let us agree that this was a correct decision, people should not lose their jobs after all. But please read the cost to produce energy by these factories! You will discover that renewable energy is cheaper! If one studies the energy market in 2013, he will notice that the price of energy drops only when renewable energy enters in competition and is offered at a lower price.

(The arguments of the Romanian Wind Energy Association against this decision, here and here)

3. Cogeneration, anaerobic digestion, biomass and biogas: A competitive advantage for all modern countries

Let's talk about cost: Why one liter of milk is almost cheaper to bring from Germany than to produce in Romania? Because German companies have implemented renewable energy projects (biogas or anaerobic digestion) while in Romania the sector is at its very beginning. This increases the cost for the Romanian company by 15 – 20% higher than a similar company from abroad and it means: Less jobs, environmental problems, less competitiveness and possible insolvency in the near future.

The existence of a reasonable subvention scheme for biomass, biogas, anaerobic digestion and “waste to energy” etc can lead to more than 12.000 jobs, spread all around the country. Jobs that will be sustainable for 25 years, matching with the duration of the producer’s license!

4. Cogeneration can reduce your invoice for heating by 30 – 40%

If Romania pushes cogeneration through Renewable Energy, the effect will be an immediate reduction of your invoice for heating by some 30 – 40%, from Day 1! Any project connected to the grid will transform a city or town into an energetically independent zone where people pay much less for heating and know that this will not change for 2,5 decades.

5. Why don’t you ask the “good guys who want to protect you from the cost of Renewable Energy” about the penalties Romania will pay for not developing the Renewable Energy sector?

In case Renewable Energy is not developed in Romania, according to the agreements that the country has signed, the penalties will be huge. Guess who will pay for them: The population. How? With higher taxes or less roads and public works.

It is easy to accuse and blame Renewable Energy for everything. But reality is different. Even if we agree that not all types of Renewable Energy favor the Romanian economy, I think that we can choose the ones that add to the country’s competitiveness and business environment and focus more on them.

What is your opinion?

On Thursday: How can we lower the cost for the people and maintain feasible the Renewable Energy sector?