Renewable Energy in Romania and Bulgaria: 2 neighbors with completely different energy market (plus a detail that most of the media never tell you about)

Lately we see in some media stories about the situation of Renewable Energy in Germany and Bulgaria and then the comparison to Romania. Every time a “forgotten “expert” in Germany declares something negative about Renewable Energy, more Romanians read about it than Germans! In the same time all news from Bulgaria become headlines in part of Romanian media as well, comparing Romania with its Southern neighbor. But can these 3 countries be compared in the sector of Renewable Energy? Let us see the reality behind the empty words:

Part 2: Romania and Bulgaria

Romania – Bulgaria: Size of economy, role of the State

Bulgaria does not have a big economy, it is 3 times smaller than the Romanian one. Politicians play an important role in the economic activity, even greater one than the role of their Romanian colleagues to its local business environment.

Romania – Bulgaria: Energy consumption – production – resources

Bulgaria requires less than 4.500 MW per hour, based on its local demand, which suffered an important reduction after 2008. It used to export some hundreds of MW to Greece as well, but the Greek consumption is 20% less as well. Its industrial sector is much weaker than the Romanian one, with significantly less need of energy as well. The mix of resources from which energy is produced is completely different than in Romania. Official reports state that Bulgarian output of energy stands at 11.250 MW, almost 2,5 times more than it is needed.

In Romania the supply and demand of energy are almost balanced (8.000 – 10.000 MWh). The demand for energy has declined as well, but in the same time, the mix of energy is different.

Romania – Bulgaria: Renewable Energy and a detail no media is telling you

Bulgaria has developed its Renewable Energy sector since 2007 – 2008. Nowadays its mix of projects is different from the Romanian one, where wind dominates the market, as the installed capacity of wind projects reaches 95% of the total operational ones.

The detail that media does not tell you about

Let us now focus on an important detail that most media does not tell you about: In Bulgaria the Renewable Energy producers just inject the energy to the grid and the State covers the cost of balancing. In Romania, the situation is opposite.

What is balancing? Let us agree that you are the owner of a photovoltaic plant with installed capacity of 5 MW and tomorrow at 12.00 you inform the grid operator (or the market) that you will inject to the grid 4 MW. But something happened (clouds) and you can inject just 2 MW.

In Bulgaria, you do it and the State pays to find the other 2 MW and balance the grid, because the grid expects 4 MW after all. How much is this cost? Huge…

In Romania you will have to pay by yourself and find the rest of 2 MW, so as for the grid to receive 4 MW as you promised. You, as investor, pay for this cost (usually to a trader) and like this, the country does not need to pay tens of million Euro per year.

(I don’t know the figures in Bulgaria, but the Greek State, through the State owned national electricity company, having an installed capacity of 1.500 MW of wind projects and 1.700 MW of photovoltaic projects has to pay some 300 million Euro per year. In Romania, this cost is saved).

So when you read about “the problems of Renewable Energy”, keep in mind that in Romania balancing is resolved in advance, without the State and the citizens to pay for this.

Bulgaria: The high electricity bills

All the fuss about Bulgaria is related to people protesting against the government, due to the expensive electricity bills. Some of my friends in Bulgaria told me that this happened due to the fact that the energy bill did not come on time once and some months later the total sum of 2 bills was sent in 1. But let us assume that this is not correct.

The country has less than 4.500 MW demand and over 11.000 MW supply, for which the production cost is heavy for the population. Isn’t clear that there is a bubble to burst here? How long can Bulgarians pay for 2,5 times more energy than they need?

(It is like for Romanians to pay for 20.000 – 25.000 MW of energy, conventional or renewable. Would this be sustainable?).

Romania: The list of big hydro energy factories that need billions to upgrade

In the next years Romania will have to upgrade a series of hydro energy factories (and not only) around the country. It sounds easy, but it requires billions of Euro to be invested, billions which do not really exist today. If these factories will not be upgraded, the options for the country are specific in order to match the demand with the supply: New conventional investments, private or public, or renewable energy (especially stable one).

Bulgaria has different challenges to face. For them it is easy even to shut down factories, the demand is too weak and easy to supply.

Is Bulgaria and Romania similar?

No! They are not! No matter how much some people try to convince us that “what happened in Bulgaria will inevitably happen here too”, the reality is completely different! Despite the “natural talent” of Romanians to accuse their country, at least in comparison with Bulgaria the Romanian energy market is healthier and the State has many more options to secure its sustainable status.

Then why do we read so many stories about Bulgaria and predictions that things will be the same in Romania as well?

Maybe because:

• Some people here predict that the demand will be cut to half, with hundreds of factories to close and the demand for energy to be much less. (I don’t see how this is possible).
• It is convenient to promote your own plans by mixing people and comparing irrelevant situations.
• It is nice to see everything dark and predict revolutions. It is more exciting than explaining the reality.

Overall: While some media in Romania try to convince us that “Bulgaria collapsed and Romania follows” Bulgaria would just dream to reach the actual situation of Romania in the energy sector.

Comparing Romania and Bulgaria on the Renewable Energy sector is at least unfair. Let’s predict the end of world based on different, more solid arguments.

What is your opinion?

Thursday:     

Can we lower the cost of energy and green certificates; protect the people and the Romanian industries, without destroying the Romanian Renewable Energy sector?

For Part 1: Germany and Romania: here