Romanian President Traian Basescu announced on Thursday evening (March 13) that he had signed the law approving the government's emergency ordinance to cut the number of green certificates, adding that he expects to see lower electricity prices.

This however only enforces an existing government ordinance, and does not seem to solve the problem raised earlier by steel maker Alro.

“To clarify things, I have passed today the law approving the ordinance and I look forward to seeing lower electricity prices. I think it is also what the population wants, they expect lower prices, according to government statements,” said the President.

He added that he made the decision in order to remove the Presidency from disputes with trade unions, even if it doesn’t have “the approval from the European Commission, as the treaty requires”.

However the EC’s reaction was the government’s problem, he said.  “Sure, there might be unpleasant consequences once the opinion of the Commission arrives, but I think that through the public position it took, the Government took on the responsibility to correct any consequences of an opinion that might not entirely approve the content of emergency ordinance 57,” said Basescu.

With the law signed, Basescu expressed his wish for an end to trade union rallies outside the Constitutional Court, adding they shouldn’t expect anything from the President; again saying it was the Government’s problem.

On the same day as Basescu's statement, the Romanian Prime Minister Victor Ponta met with representatives of aluminum producer ALRO Slatina for talks on green certificates, given the “public debates on the law to approve the government emergency ordinance  OUG 57/2013,” reads a statement of the Government.

The OUG 57 postponed awarding green certificates for certain energy producers to 2017.

The law states that in 2017 a green certificate per MW will be awarded for energy producers with new hydro power plants of up to 10 MW, a green certificate for companies running wind farms, and two green certificates for producers of photovoltaic energy.

Prior to this, the state handed out three green certificates for hydro power plants, two for wind farms, and six for solar parks.

During discussions, Ponta assured the company’s representatives that the Government supports the law’s entry into force by March 19.

Alro's requests however targeted reducing, by 85 percent, the number of green certificates the company is obliged to buy, so passing the law which enforces the existing government ordinance does not help.

Regardless, the government’s statement implies as such, highlighting that “the Prime Minister asks the President to pass the law of approval, to solve the issue raised by Alro representatives and to avoid price increases in the Romanian industry and for consumers”.

Alro Slatina’s general manager Gheorghe Dobra said earlier this week that the company can only hold out a few more months on the market unless Romanian authorities reduce electricity taxes designed to promote renewable energy.

The Romanian state awards green certificates to clean energy producers for each MW of produced electricity, and in turn they get to sell them on the open market.

All electricity consumers - including individual consumers - bear the cost of buying green certificates. This affects mainly large consumers, such as Alro, which complained it had to spend tens of millions of euros last year on green certificates. Alro posted a loss last year.

Electricity distribution companies, such as Enel and CEZ, too have to buy green certificates, and the price is also mirrored in the electricity bills paid by the population.

Irina Popescu, irina.popescu@romania-insider.com, Corina Chirileasa, corina@romania-insider.com