Romania wants new owners to make major investments in power companies
Romania will sell majority stakes in two state-owned regional power distributors next year and will require the new
owners to make major investments in the companies, the country's Industry Minister Dan Ioan Popescu said.
“Each (power) distributor needs some $ 200-$ 300 mm (in modernization) to bring its equipment to normal
standards,” Popescu said.
He said the investments to improve productivity are needed to keep energy prices affordable. He said the distributors
need to replace obsolete equipment from power cables to transformation units to lower operational costs.
The Romanian government plans to privatise Electrica Banat and Electrica Dobrogea, which supply electricity to the
western and the south-eastern parts of the country, respectively. Electrica Banat has some 840,000 clients and sells
3.6 mm MWh annually, while Electrica Dobrogea has 580,000 clients and sells 3.3 mm MWh.
The privatisation strategy, which still has to be approved by the government, would ask investors to pledge millions
of dollars to the companies on top of the price they paid for the stakes. So far, he said only five European
companies have expressed interest in this privatisation: Germany's E.ON and RWE, Spain's Union Fenosa, Electricite de
France, and Italy's Enel.
The privatisation of the two power distributors is a key requirement of the country's standby loan agreement with the
International Monetary Fund.
