ADS makes 84,500 hectares available to state energy companies

The State Domains Agency (ADS) is preparing 84,500 hectares (ha) of non-productive or poorly productive agricultural land of the state that will be concessioned to public energy companies for the construction of photovoltaic or wind farms, according to a press release sent to the Editor yesterday by the respective institution .

ADS has completed "the written inventory of state-owned land that could be used for the establishment of wind or photovoltaic power plants", the press release states. The cited source states: "Approximately 8,500 ha of unproductive agricultural land have been identified, of which the most important areas are in Constanţa County, 2,738 ha, in Brăila County, 1,550 ha, and in Argeş County, 1,222 ha. To these are added approximately 76,000 ha, agricultural land classes IV and V, i.e. the weakest from the point of view of agricultural creditworthiness. The most important areas are in Călăraşi County, 26,625 ha, in Sibiu County, 9,377 ha, and Dolj County, 4,906 ha. (...)State-owned lands, under the administration of ADS, identified as non-productive or of IV and V quality, called "RES acceleration zones", will be entered in the Single Inventory Register of Non-productive Lands. The establishment of this Register is the first step foreseen by the REPowerEU Plan in the case of renewable energy investment projects and is the responsibility of the State Domains Agency".

Currently, state lands managed by ADS can only be used for agricultural activities. The REPowerEU Plan envisages amending the legislation to allow the classification as "acceleration zones for RES (renewable energy sources)" of those lands owned by the Romanian state and managed by ADS, which are classified as non-productive/degraded so that they can be used for the production of energy from renewable sources.

According to an emergency ordinance project initiated by the Ministry of Public Finance, the respective lands would be directly concessioned, without an auction, for a period of 49 years, to companies with state capital in the energy field for the development of projects in the field of wind energy and energy photovoltaics. The respective project of the normative act was criticized by the representatives of the employer organizations of the private energy business environment - Romania Wind Energy Association (RWEA), the Organization of Renewable Energy Producers in Romania (PATRES) and the Romanian Photovoltaic Industry Association (RPIA) - which showed that the said direct concession of ADS lands to state companies represents unfair competition to the rest of the developers of renewable energy production capacities.

The representatives of employers' organizations recently stated in a press release: "In the context in which, from 2022, private investors can only develop projects on areas below 50 hectares (maximum 42 Megawatts) based on the restrictive interpretation of the land fund law by The Ministry of Agriculture and Rural Development (MADR), the draft Emergency Ordinance regarding some measures for public property of the state, which favors entities and companies where the state is the majority shareholder, is profoundly anti-competitive. (...) A direct negotiation between ADS and certain selected companies is not able to ensure fair conditions of competition. We emphasize that the inclusion of projects to be carried out by state companies (or private, where the state is the majority shareholder) in the category of investment objectives of national interest implies the facilitation of the approval process, not the direct assignment of land or surface rights".

RPIA, RWEA and PATRES state that they are not opposed to the realization of such projects, but request the provision of fair competition conditions for all developers of energy production capacities from renewable sources, which can be achieved by removing the 50 hectare barrier and by inviting all interested parties to participate in a transparent and competitive process of awarding land areas owned by the state.

The text proposed by the Ministry of Finance establishes: "By derogation from the provisions of art. 312 paragraph (1) of the Administrative Code, with subsequent amendments and additions, for projects of strategic interest and those of national security in the energy field, energy infrastructure investment projects of national strategic interest, direct concession rights are granted over land in the public and private domain of the Romanian State to legal entities under private law in which the Romanian State is a full/majority shareholder under financial conditions approved by the Committee on Privatization, Concession and Leasing of the proposal of the State Domains Agency. Any existing contracts, regardless of their nature, ongoing for these categories of land are amended by law to ensure the implementation of investment projects of national strategic interest by the corresponding reduction of the land areas that are the subject of them, by means of an additional act, concluded in accordance with the law . (...) The concession by direct assignment is made during the existence of the fixed asset or asset, but not more than 49 years".

In the substantiation note, the Ministry of Public Finance shows that the adoption of the emergency ordinance will not generate any impact on the competitive environment, nor in the field of state aid.