Romania's largest energy producer Hidroelectrica cancels contract with Energy Holding after massive losses

Romanian state owned electricity producer Hidroelectrica unilaterally canceled the contract with Energy Holding, after suffering losses of some EUR 311 million since 2006. Five other contracts were previously canceled: Euro-P.E.C., EFT, Alpiq RomIndustries and Alpiq RomEnergie.

Economy Minister Daniel Chitoiu said last week that by end July all contracts with the so called 'smart guys' could be canceled, hoping that Hidroelectroica will exit insolvency by the last quarter of this year. He also recently said Hidroelectrica has registered damage of some EUR 1.3 billion from bilateral contracts with 'smart guys'. Hidroelectrica, the largest energy producer in Romania, became insolvent in June, after a drop in turnover, an increase in debt, caused by a management 'disaster' and the 2011 drought. Hidroelectrica's contracts for the direct sale of energy under market prices were signed between 2001 and 2003 and should expire in 2014, 2015 and 2018. editor@romania-insider.com photo source: sxc.hu