Italian Enel had planned to invest 2 billion euros in its operatons in Romania, but now it is reconsidering the plans after the Government decided to cap energy prices and levy a windfall revenue tax, including in the segment of renewable energy generation.
According to Enel Group CEO Francesco Starace, the volume of investments will be downsized if the measures remain in place. Enel believes that the measures imposed by the Romanian authorities are incorrect, discourage investors, create instability, do not solve structural problems and need to be changed, as happened with the measures taken by other Governments in Europe.
Enel’s CFO Alberto de Pauli said that, when current business plan was made, Romania was an attractive country, and Enel planned to invest more than 2 billion euros to massively develop renewable energy projects and networks. Obviously, if these measures remain in force, the yields will decrease, so Enel will have to revise its investments in Romania.
Romania’s Government enacted a set of measures to be enforced over this winter (until March 2022) with the aim of helping households weather the high energy prices. Thus, an 80 % windfall tax is levied on the revenues derived by electricity producers that sell their output at prices above 91 euros/MWh. The money collected this way will be used to pay subsidies to households with small consumption and compensate the suppliers that purchase electricity at the market price that may be higher than the capped prices charged to households.
