ROMANIA BIOMASS MARKET

Outlook 2013 ÷ 2018

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ROMANIA BIOMASS MARKET: OUTLOOK 2013 ÷ 2018

This market report offers an incisive and reliable overview of the biomass sector of the

country for the period 2013 ÷ 2018. In view of maturing biomass markets in Germany,

Austria, France, UK, Czech Republic, Slovakia and Italy, Romania represents a stable

investment environment in South-East Europe with clear rules and green certificates

support scheme. Current cumulative installed biomass capacity in the country is

insignificant but is expected to start growing. Romanian market has good chances to reach

more than 210 MW in the next 2 years. The report provides a complete picture of the

market situation, dynamics, current issues and future prospects. You will find more than 60

pages of valuable information in this unique in-depth analysis of the Romanian biomass

market. With comprehensive market data this report brings clear and concise insights, to

help investors in their decision making process. As 2011 and 2012 were challenging years

for biomass industry, the time for taking right decisions during 2013 and the next few years

is limited. Fast changing market environment, requires relevant and accurate information.

For your convenience we offer opportunity for orders with customized report content.

Reasons to buy this market report are, but no limited to:

Brief overview of the Romanian political and economic environment Biomass resource potential in Romania Overview of Romanian biomass market development 2000 ÷ 2018 Grid connected biomass installations for 2012/2013 Future market trends and planned biomass projects for 2013 ÷ 2018 Current market prices of fully permitted and operational biomass projects Romanian legal and energy regulatory framework for renewable projects Key companies and competitive landscape in biomass sector Review of most relevant financing and supporting incentives SWOT Analysis

At next pages you will see the full table of content of this report. To order this report just

fill in and send us the enclosed at the last page order form. If you have any other questions

please do not hesitate to call us on ++359 887 342 475 or write an e-mail to

orders@ineaconsulting.eu

ROMANIA BIOMASS MARKET: OUTLOOK 2013 ÷ 2018

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TABLE OF CONTENTS

FOREWORD .................................................................................................................... 6

1. METHODOLOGY .................................................................................................... 8

2. EXECUTIVE SUMMARY ........................................................................................ 10

3. ROMANIAN POLITICAL AND ECONOMIC ENVIRONMENT ..................................... 13

3.1. Basic country data ................................................................................................... 13 3.2. Political Climate and Ruling Party ........................................................................... 16 3.3. GDP and Economic Growth ..................................................................................... 16 3.4. Electricity Imports and Exports. Electricity prices for business and households .... 18 3.5. Taxes ........................................................................................................................ 20

3.5.1. VAT ....................................................................................................................... 20 3.5.2. Income and Corporate Taxes ............................................................................... 20

4. ROMANIAN BIOMASS ENERGY MARKET .............................................................. 21

4.1. General electricity market information .................................................................. 21 4.1.1. Electricity Consumption and Production ............................................................. 22 4.1.2. RES targets to 2020 .............................................................................................. 22

4.2. Biomass market ....................................................................................................... 25 4.2.1. Why invest in biomass energy in Romania? ........................................................ 26 4.2.2. Romanian biomass resource potential ................................................................ 27 4.2.3. Overview of Romanian biomass market 2000 ÷ 2018 ........................................ 28 4.2.4. Market prices for BIOMASS projects in Romania ................................................ 30 4.2.5. Development projects and operational BIOMASS plants in Romania ................ 30 4.2.6. Key biomass companies operating on Romanian market ................................... 34

5. EUROPEAN RENEWABLE ENERGY POLICY LANDSCAPE ......................................... 36

5.1. Romanian RES Regulations and EU Directives ........................................................ 36 5.1.1. Precedent EU regulations .................................................................................... 36 5.1.2. Most recent EU renewable energy policy developments ................................... 37

5.2. Renewable energy mandatory targets for Romania set out by the EU .................. 37 5.2.1. Interim targets set out by the EU ........................................................................ 37 5.2.2. National support schemes flexibility allowed by the EU ..................................... 38

5.3. RES LEGAL Project ................................................................................................... 39

6. ROMANIAN RENEWABLE LEGAL AND REGULATORY FRAMEWORK ....................... 39

6.1. Main laws and regulations ...................................................................................... 39 6.2. Zoning, planning and construction related authorizations ..................................... 40 6.3. Environmental related authorizations .................................................................... 41

6.3.1. Natura 2000 Network .......................................................................................... 41

ROMANIA BIOMASS MARKET: OUTLOOK 2013 ÷ 2018

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6.3.2. Joint Implementation .......................................................................................... 41 6.4. Energy law authorizations ....................................................................................... 42

6.4.1. Power Generation Licensing ................................................................................ 42 6.4.2. Grid Interconnection ........................................................................................... 42 6.4.3. Power Off-Take .................................................................................................... 42 6.4.4. Green certificates ................................................................................................ 43

6.5. Financial Incentives and Support for RES electricity ............................................... 45 6.6. Future market pricing mechanisms ........................................................................ 46 6.7. Key Co-financing opportunities ............................................................................... 46

7. KEY ORGANIZATIONS AND INSTITUTIONS ............................................................ 47

7.1. Government ............................................................................................................ 47 7.1.1. The Ministry of Economy, Trade and Business Environment (METBE) ............... 47 7.1.2. Romanian Energy Regulatory Authority (ANRE) ................................................. 47 7.1.3. Ministry of Environment and Forests (MoEF) ..................................................... 47 7.1.4. Ministry of Agriculture and Rural Development (MARD) ................................... 48

7.2. Distribution System Operators (DSO’s) ................................................................... 48 7.2.1. Electrica SA .......................................................................................................... 49 7.2.2. E.ON Energie ........................................................................................................ 49 7.2.3. CEZ ....................................................................................................................... 51 7.2.4. ENEL ..................................................................................................................... 51

8. SWOT Analysis .................................................................................................... 53

9. CONCLUSIONS ..................................................................................................... 58

10. LIST OF ABBREVIATIONS ...................................................................................... 60

11. REFERENCES ........................................................................................................ 62

12. DISCLAIMER ........................................................................................................ 71

APPENDIX I. BIOMASS MAPS OF EUROPE AND ROMANIA .............................................. 72

ROMANIA BIOMASS MARKET: OUTLOOK 2013 ÷ 2018

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LIST OF MAPS, CHARTS AND TABLES

Map 1: Where is Romania on the European map ................................................................. 13 Map 2: Major transport corridors passing through Romania................................................ 14 Map 3: Romanian regions ...................................................................................................... 15 Map 4: Biomass potential of Romania ................................................................................... 26 Map 5: NATURA 2000 areas in Romania ............................................................................... 41 Map 6: Districts covered by Electrica SA ............................................................................... 49 Map 7: Districts covered by E.ON Energie Romania .............................................................. 50 Map 8: Districts covered by CEZ ............................................................................................ 51 MAP 9: Districts covered by ENEL .......................................................................................... 52 Chart 1: Real GDP growth for the period 2000-2018 (including estimates) .......................... 17 Chart 2: Romanian GDP growth compared to EU-27 for the period 2002 ÷ 2018 ................ 18 Chart 3: Electricity imports and exports for the period 2004 ÷ 2018 (in million MWh) including estimations ............................................................................................................. 19 Chart 4: Corporate tax income in the region ........................................................................ 20 Chart 5: Structure of Romanian electricity market ................................................................ 21 Chart 6: Share of RES electricity in gross energy consumption 2012 .................................... 22 Chart 7: Romanian RES targets in % set by the EU ................................................................ 23 Chart 8: Cumulative developments of BIOMASS plants in Romania in MW from 2000 to 2018, including estimates ...................................................................................................... 33 Chart 9: Market Shares by Sales of the Major DSO’s in Romania in 2012 ............................ 48 Chart 10: Structure of E.ON Energie Romania ....................................................................... 50

Table 1: Electricity prices for business and households ........................................................ 19 Table 2: Support schemes for RES generation in the EU countries ....................................... 25 Table 3: Market prices for BIOMASS projects in Romania for 2013 ÷ 2018 ......................... 30 Table 4: Selected operational, under construction and planned biomass projects in Romania ................................................................................................................................. 33 Table 5: Green certificates for electricity from BIOMASS sources in Romania ..................... 44

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