Restructuring of Romanian power complex CEO: EUR 3.94 bln investments, coal-fired units maintained by end-2029

The Romanian state has committed to sell 20% of the coal and power complex CE Oltenia (CEO) by the end of 2026, according to the company's Restructuring Plan, approved by the European Commission at the end of January and published on May 2.

At the same time, according to the plan, the company will be allowed to use coal to produce electricity by the end of 2029 if market conditions require it, Bursa.ro reported.

On December 20, 2020, Romania notified the European Commission about the company's restructuring plan, in February 2021, the Commission began an investigation on this issue, and on January 26, 2022, the plan was approved.

The plan requires investments worth EUR 3.94 bln by 2026, of which almost EUR 2.66 bln is state aid and EUR 1.28 bln is the contribution of the CEO, the financing banks (including the European Bank for Reconstruction and Development EBRD) and the investors in the energy company's investment projects.

The main restructuring measures include phasing out the use of coal, the separation of the Craiova plant into a separate legal entity (which will later merge with a municipal company), staff reduction, operational excellence and efficient management, digitization and the abandonment of non-core assets.

The company is mainly considering the construction of 1,325 MW combined cycle gas plants (ready in 2026) and 735 MW photovoltaic plants (ready in 2024) to replace the current coal (lignite) fired capacities. Investments in these new capacities amount to about EUR 1.52 bln.

The financing under the Modernization Fund (European grants) is 50% for gas-fired capacities and 70% for photovoltaics capacities.

(Photo source: Facebook/Complexul Energetic Oltenia)