City Halls, Not In A Hurry To Find Private Investors For Public Heating Plants

CEZ, the Czech-based energy group planning to become one of the leading energy producers in Romania, is interested in investing in the antiquated plants producing electricity and heating for the major cities in the country. "We are exploring every investment opportunity on the market. We are also interested in participating in the modernization and technological upgrading of the power and heating plants, the CETs, owned by the city halls. However, the authorities have taken few actual steps in this respect. It is only know that the legal framework encouraging investment in co-generation is being improved, but few city halls have organized the procedures for tenders or for attracting private investments," CEZ Romania COO Martin Pacovsky told BURSA.

He emphasized that, despite their large debts and antiquated technology, the CET were still interesting to strategic investors. "The city halls need to decide how they want to develop the CETs and start selecting investors. If the legal framework is improved and clarified rapidly, there are great chances that important investments may start in this field," Pacovsky added.

CEZ Romania is currently building the wind park at Fantanele - Cogealac. The 1.1 billion EUR investment will be fully commissioned in 2011. The company has also signed a memorandum of understanding with heating and electricity producer company Termoelectrica to develop a 400 MW electric power plant in Galati for some 400 million EUR. Martin Pacovsky further told BURSA that it was hard to say when CEZ would make the decision to invest in the power plant in Galati. "The assets they will put into the future joint venture are currently being evaluated. Then we need to negotiate our stake in the project and we need to see what the value of the investment will be," he said.

CEZ is also taking part in the construction of Reactor 3 and Reactor 4 of the Cernavoda Nuclear Plant as a minority shareholder together with give other private companies. Nuclearelectrica holds 51% of the roughly 2.2 billion EUR project.