Getting real with green energy
Better legislation and pragmatic views on what the country can deliver will help Romania’s green energy credentials. Peter Simon, ABB country manager talks to Ana Maria Nitoi
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Peter Simon, Romanian country
manager of Swiss-Swedish engineering
company ABB, is talking
realistic perspectives on green energy.
He says the wind energy business in
Romania is tougher to kick-start than
in most western countries, because the
laws establish no set price for the production
of green energy.
When an energy company wants to
draw up a business plan for using alternative
resources, this is hard because
the energy price is not clear and it cannot
make accurate profi t forecasts. “In
Romania, one has to fi rst trade the energy
in order to have a price and that is
why it is diffi cult to obtain fi nancing for
such a project,” Simon adds.
There is also no Government subsidy
for green energy, as in Germany.
“Considering all these impediments,
I don’t believe that we will see in Romania
any small-scale business in wind energy,
because only big companies such
as Enel or Iberdrola can afford [to risk]
these unknown factors,” Simon adds.
The climate in Romania is not that
suitable for wind energy, which needs a
constant wind speed to produce electricity,
argues Simon. In heavy storms and
low wind speeds, turbines have to stop.
Biomass and geothermal energy
could be more profi table, considering
the terrain and vegetation in this country,
believes the ABB country manager. Geothermal
energy, using energy from the
heat of the earth, is a more sustainable
option than traditional fossil fuel due to
the reduced amount of CO2 emissions.
The process does not depend on changing
weather conditions, such as wind.
Such plants exist in countries including
USA, Turkey, Iceland, Germany and
France and a large geothermal plant can
power entire cities while smaller power
plants can supply remote sites.
“We cannot be sure that the Earth’s
oil reserves are limited,” says Simon.
“It is just a matter of price. This is good
because it forces the market to turn towards
renewable energy.”
ABB provides power and automation
technologies to use electricity effectively
and to increase industrial
productivity. Transelectrica, OMV and
Mittal Steel Galati are among its customers
in Romania and more than 50
per cent of this activity focuses on stateowned
companies. In 2007 ABB had a
45 per cent growth in turnover and increased
its number of employees by 60
per cent to 100. Peter Simon expects the
company will continue to grow. “If the
market has a ten to 15 per cent development,
we expect around a 23 per cent growth,” he says.
Simon started this job in 1997 and
last year took over ABB’s Bulgarian
subsidiary and is now overseeing operations
in the Republic of Moldova. In
Bulgaria, ABB has its own production
facilities and 450 employees. Last year,
when the Swiss-Swedish group decided
to invest more in production, Romania
lost out in favour of Poland and Bulgaria.
The lack of workforce compared
to Poland and the expensive manpower
compared to Bulgaria were the main
reasons for the decision. Transportation
costs for the company in Poland are
lower than in Romania and the Governments
of these two countries also offered
ABB fi nancial incentives.
“We chose Bulgaria because we already
have a similar kind of production
in this country,” Simon says. This new factory will produce small components
and 60 per cent of the employees need
to be women. While Bulgarian workers
are fair and disciplined, Romanians are
fast and innovative, he adds. Bulgarians
are considered the ‘Germans’ of eastern
Europe in their work mentality.
But he is not without his criticisms.
As a co-author of the ‘Management
Guide in Romania’, Simon argues that
Romania has no leadership culture.
“The legitimacy of leadership has not
come from the way the staff cknowledge
the manager’s expertise, but from
the position itself,” he believes.
The country manager also says that
Romanian employees are reluctant to assume
responsibility, but once they have
worked under foreign management, they
rarely accept the previous methodology.
“Nevertheless Romanian employees, once
promoted, will quickly adopt the traditional
Romanian management style, even
if they have studied abroad,” he adds.
Who is Peter Simon?
“In 1996 when I first came to Romania, I
went on a motorbike tour of the country and
on my way back I tried to take a short-cut to
Bucharest and drove through a forest,” says
Peter Simon. “I found myself at a lake with a
hydro-power plant and I did not know which
way to go. I saw a little house with a man
guarding the plant and who was living there
on top of the mountains in the middle of a
forest. I went to him and I started gesturing in
sign language to get some help. After a few
seconds the guy said: ‘Do you speak English?’
That was the moment when I realised I
should not bother learning Romanian.”
Though he fell for the beauty of the Romanian
landscape and the openness of its
people, Simon has seen a recent transformation
not to his liking. “What I hate about this
country is that people have changed for the
worse in the last 15 years and [many] have
became arrogant and selfish,” he says.
Born in Speyer near the Rhine in 1950,
Simon studied mechanical engineering in
Karlsruhe, southwest Germany before signing
up with work for ABB. Starting out as a
mechanical engineer, he developed through
the ranks with postings in Saudi Arabia,
Libya, Iran and India, to country manager
in Romania in 1997. Simon is also president
of the German Business Club in Romania.
In ten years Simon has seen a drastic
improvement in the evolution of legislation
and the fiscal system in the energy field.
“Bureaucracy is a big problem compared
to Germany, but everyone has to play on
the local market with the local rules and we
have to get used to it,” he says.
He adds that a Romanian may feel the
same way about the German system. “For
a Romanian working in Germany it would
be catastrophic,” says Simon. “Because he
or she would say the system has too many
rules and regulations.”
