INTERVIEW Virgil Popescu, Energy Minister: “We need to think even more ambitiously about prosumers”

“It is not encouraging that the energy of the prosumer, which is given in the network, is paid at a very low price and, therefore, we are thinking at the level of the Government to change this, in order to reach a quantitative compensation of the extra energy produced,” Energy Minister Virgil Popescu told The Diplomat-Bucharest.

“Prosumers will become an increasingly important topic. It is necessary to be part of these changes, to be part of this revolution, including in the field of construction, energy efficiency.”

What are the priorities of the Ministry of Energy for the second half of the year?

Three concepts: PNRR, the National Investment Plan and the Modernization Fund. In parallel, we aim for the companies in the portfolio to carry out their investment programs. Regarding PNRR, we passed a plan of competitive calls for projects, we removed absolutely all companies so that there are no more questions about why others cannot participate in these projects. I want there to be as many competitors as possible because this will lower the cost of investment, lower the cost of production per megawatt. So, practically, we will have a new method of selection of projects that will be financed by PNRR: competitive calls for absolutely all financing lines: in-band electricity production, hydrogen production, installation of car charging stations, efficiency energy, batteries. The total amount is 1.6 billion euros. Regarding the National Investment Plan, we have been preparing since last year for the possibility that money will remain unused and we have taken the necessary measures to be able to use this money also for energy investments. We will also use the money for energy investments, starting with 2021. We talked to the representatives of the European Commission and this money will be carried over and added to the funds available from the Modernization Fund. The amount is about 800 million RON. And last but not least, we are pursuing the Just Transition Fund, because there is the chance of local communities whose socio-economic balance risks being disturbed by the commitments related to achieving the decarbonisation targets.

What measures will you take to stimulate the prosumer market?

It is not encouraging that the energy of the prosumer, which is given in the network, is paid at a very low price and, therefore, we are thinking at the level of the Government to change this, in order to reach a quantitative compensation of the extra energy produced. In this way I think we could much better stimulate prosumers and the installation of photovoltaic panels in households would be done at a much faster pace. Prosumers will become an increasingly important topic. It is necessary to be part of these changes, to be part of this revolution, including in the field of construction, energy efficiency. The first step was taken in the Parliament towards the end of 2018 – 2019 in the Industry Commission, in which I was also active as vice president, when for the first time we legislated in Romania the prosumer: that consumer who can install photovoltaic panels and no longer need to go through the caudal forks of all agencies, authorities in order to be able to use and give the surplus energy in the network. This has been achieved. First with 27 kW, then raised to 100 kW. We managed this step, but it is not enough. We need to think and act even more ambitiously about prosumers.

What are the chances of completing the Iernut plant this year? What is the backup plan?

We need to resume the work, to complete this investment, which is absolutely necessary. If it could not be done with the consortium that won the auction in 2016, we will complete it without them, for sure. We have also prepared scenario B and scenario C. At this moment, we are looking at a commercial commissioning deadline that reaches the middle of 2022.

At what stage is the development of the national hydrogen strategy?

The PNRR includes a funding component of around one million Euro for the creation of the hydrogen strategy and concepts. So, we have the financing, and at the moment of implementing the PNRR, the development of the hydrogen strategy will be started.

At what stage are the discussions regarding the acquisition of ELCEN by the Bucharest City Hall?

I agree to sell ELCEN to the Capital City Hall. There have been discussions and we are working on that. ELCEN has a rating, so we have a price. From my information, there would be no financial problems on the part of PMB that would make it impossible to pay the price.

What measures do you propose to protect the jobs of employees at the Mintia and Paroseni thermal power plants?

If it was an area on which I focused this half year, then it was the social protection of employees from CEH, CEO and CNU, miners and energy companies alike, in the case of the two energy complexes. We have approved through the Government a memorandum containing the principles of a social protection package which also contains compensatory payments and supplementary income. It is a program that will last for many years because the phase-out on coal is done gradually. Just a month ago at EU level, a regulation establishing a 17.5 billion Euro fund was approved to make the green transition more equitable and inclusive. It’s that Just Transition Fund we’ve been talking about. The money will be used to help the people of the Jiu Valley, in Oltenia. Based on this memorandum, we subsequently issued an emergency ordinance, which allows us to implement these social protection measures. We can make the payment of compensatory salaries negotiated by the unions with the management of the companies through the collective labour agreements. They are paid from the state budget for companies that do not have money, such as the Hunedoara Energy Complex. We are also talking about supplementary income between 24 and 48 months for the Hunedoara Energy Complex, the Oltenia Energy Complex, the Mine Valley Closure Company. All those who will be made redundant during the period will benefit from social protection. In parallel, the supplemental income will be linked to participation in qualification courses, professional upgrading, to find a job and, moreover, we encourage them: if they find a job to continue to receive 50% income for completion.

Just a few days ago, I signed with the National Trade Union Bloc the Memorandum “Profiling services for the labour force to be made available within the Hunedoara Energy Complex Company”. We started a modernization process, in order to leave a “green” legacy to the next generation. But at the same time, we make sure that we do not neglect the social component, people are important. I want to send an appeal to other trade union confederations: I invite them to join this initiative to help those in need.

In the medium and long term, however, the best measure to protect jobs are also investments, because they generate jobs, and I want investments in the area.

Regarding the production of solar panels in the Jiu Valley, a support scheme, state aid, can be designed by the Ministry of Energy and the Ministry of Investment and European Projects. I remind you that the funding will be granted only on the basis of territorial plans, developed together with local and regional authorities, and these plans will identify the most affected territories and their investment needs. Money exists, and local authorities and the Ministry will work closely for these investments.