Romania's Government extended a EUR 241.4 million state aid to distressed power producer CE Oltenia, by an emergency ordinance signed on March 31. The ordinance comes before the European Commission's final opinion on the Executive's plans to rescue the insolvent coal and energy complex, Greenpeace announced.

Romania's minister of energy Virgil Popescu previously informally announced plans to extend a bridge loan. But the ordinance envisages a state aid - a loan that converts into a grant upon successful completion of the restructuring plan or has to be returned if the recipient fails to meet the plan's objectives.

State-controlled CE Oltenia, a major electricity producer in the past that faces high costs generated by the CO2 certificates, drafted a restructuring and decarbonization plan and sent it to the European Commission for review and approval. However, the CE's preliminary review was not positive, and Greenpeace argues that the company should revise it thoroughly.

The environmental organization argues for a genuine restructuring of CE Oltenia under a revised plan. It also believes that the Government's decision to extend state aid before European Commission's approval puts such a strategy at risk.

Greenpeace, Europe Beyond Coal, and Bankwatch Romania have sent a joint letter to European Commissioner for Competition Margrethe Vestager to highlight the violation of state aid regulations by the Romanian Government.

andrei@romania-insider.com

(Photo source: Greenpeace Romania)