Romania Energy efficiency report

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1 Romania Energy efficiency report Objectives: 2.8 Mtoe of end-use energy savings by 16 4 decrease in energy intensity between 4 and 15 Overview 9-9 (% / year) Primary intensity (EU=) % ++ CO 2 intensity (EU=) % ++ CO 2 emissions per capita (in tco 2 / cap) % + Power generation 9-9 (% / year) Efficiency of thermal power plants (in %) % ++ Rate of electricity T&D losses (in %) % -- CO 2 emissions per kwh generated (in gco 2 / kwh) % - Industry 9-9 (% / year) Energy intensity (EU=) % ++ Share of industrial CHP in industry consumption (in %) % + Unit consumption of steel (in toe/t) % -- *8 and -8 for steel ++ Among best countries + Better than the EU average - Below the EU average -- Among countries with lowest performances Latest update: January 11 1 The European Union, as the best-performing region, is used as the benchmark. 1 Romania Country reports

2 1. Overview 1.1. Policies: 2.8 Mtoe of energy savings by 16 Romania s National Energy Efficiency Action Plan sets an energy savings target of 2.8 Mtoe by 16, ie, 13.5 percent of the average annual energy consumption between 1 and 5. Previously, under the National Strategy for Energy Efficiency for 4-15, a percent energy intensity reduction target was set for the period between 1 and 15: 41 percent of that decrease should be achieved in buildings, 29 percent in the energy sector, 16 percent in industry and 14 percent in transport. The aim is to make that reduction possible through the implementation of energy efficiency programs (63 percent of the energy intensity decrease) and the promotion of high energy efficiency standards for new installations (37 percent) Energy consumption trends: declining consumption Romania s total energy consumption (primary consumption) per capita is almost twice as low as the EU average, at 1.6 toe. Primary consumption decreased dramatically between 199 and (-3.1 percent/year) and increased slightly until 8 (+1.1 percent/year). In 9, Romania was hit by the global economic turndown and primary consumption fell by 2.5 percent. Romania is a gas producing country, and in 9 gas covered 29 percent of primary energy consumption. The shares of oil and coal amount to 25 percent and 21 percent, respectively. Biomass accounts for 13 percent, while nuclear power and hydroelectricity cover 8 percent and 4 percent of primary consumption, respectively. The share of industry in final consumption collapsed between 199 and 9, from 6 percent in 199 to 36 percent in 9. That decline is explained by the rising share of the residential sector and the rapid growth in the energy consumption of transport (21 percent of final consumption, compared with 9 percent in 199). Figure 2: Distribution of final energy consumption by sector Households -Services -Agriculture Transport Industry (including non energy use) At around 2,5 kwh, electricity consumption per capita is 64 percent lower than the EU average. Electricity consumption dropped by percent between 199 and and increased slightly until 8 (+1.9 percent/year). In 9 it fell by 8 percent, following the 14 percent drop in industrial electricity consumption. Industry accounts for 57 percent of electricity consumption in Romania (74 percent in 199), and its electricity consumption trends have significantly influenced energy consumption in the country. Figure 1: Total and final energy consumption trends Figure 3: Electricity consumption trends by sector Industry Others 5 5 Mtoe TWh Primary consumption Final consumption Country reports Romania 2

3 Romania Energy efficiency report 1.3. Energy efficiency and CO 2 trends: rapid improvements Primary energy intensity (primary energy consumption per unit of GDP) decreased by 4.4 percent/year between 199 and 9. That overall improvement in efficiency is mainly due to final consumers, since final energy intensity (final energy consumption per unit of GDP) fell by 5 percent/year over the given period, thanks to efficiency gains in industry: industrial energy intensity dropped by more than 7 percent/year between 199 and 8. Between 199 and 9, CO 2 intensity (CO 2 emissions per unit of GDP) decreased by 5.4 percent/year. That performance is mainly due to the drop in primary energy intensity (84 percent). Switching to fuel with a lower CO 2 content accounted for 16 percent of that improvement. percentage point every year, reaching percent in Power generation trends by source: increasing share of coal-fired generation Coal is the most consumed fuel for power generation (39 percent in 9, compared with 29 percent in 199). The share of oil fell from 18 percent of power generation to 1 percent over the period, while the share of gas dropped from 35 percent to 21 percent. The share of CO 2 -free power production increased strongly, from 18 percent in 199 to 46 percent in 9, due to the commissioning of nuclear power plants in and 7: nuclear power accounted for 19 percent of power generation in 9, compared with 11 percent in. The share of hydropower also increased, from 18 percent to 27 percent. Figure 4: Energy and CO 2 intensity trends Figure 5: Power generation by source Other* %/year TWh Hydro Nuclear Gas Oil -6. Coal-Lignite Primary energy intensity Final energy intensity CO 2 intensity *Including biomass, geothermal and solar 2. Power generation 2.1. Policies: at least 38% of renewable electricity by The Romanian Energy Strategy 7- establishes targets for renewable electricity in power production (35 percent in 15 and 38 percent in ). Romania implemented a regulatory framework for the promotion of electricity from renewables by introducing guarantees of origin and a green certificate market with mandatory quotas. Electricity suppliers are obliged to sell a certain volume of electricity produced from renewables each year; the volume of quotas is decided annually by the Government (8.3 percent in, up from.7 percent in 5). At the end of every year, the suppliers have to show evidence of the sales of renewable electricity with green certificates. The green certificate market has been operational since November 5. Following the review in of the law for the promotion of renewable energies, the mandatory quotas have been raised to 14 percent in 13 (from 9 percent previously) and are supposed to rise by Efficiency of the power sector: rising efficiency rate Between 199 and 9 the average efficiency of the power sector increased noticeably, from 23 percent to 38 percent. That improvement was partly achieved through the rising share of hydropower in the electricity mix (higher efficiency) but also through the growing efficiency rate of thermal power plants (from 19 percent to percent over the period). Indeed, since, old power plants have been replaced by gas fired-facilities with a higher level of efficiency. 3 Romania Country reports

4 Figure 6: Efficiency of power generation and thermal power plants Figure 8: Electric T&D losses % % 9 7 Total power generation 5 5 Thermal power plants Figure 7: Thermal electricity capacity, by technology Steam 18 CO 2 emissions per kwh produced decreased between 199 and 9, from 55 gco2/kwh to 4 gco2/kwh, but remain 21 percent above the EU average Figure 9: CO 2 emissions factor for power generation 12 6 GW gco ₂/kWh Romania s average rate of T&D losses is twice as high as the EU average, at 14 percent in 9, and has been increasing since 199 (9 percent). 3. Industry 3.1. Policies: long-term agreements and investment subsidies Romania s National Energy Efficiency Action Plan aims to improve industrial energy efficiency and includes voluntary agreements, financial instruments and regulations. Industrial operators can sign long-term agreements under which they adopt energy savings measures (modernization of technological processes or efficient use of energy). Large consumers have to carry out energy audits and energy efficiency improvement programs, and produce an energy Country reports Romania 4

5 Romania Energy efficiency report 3.3. Energy intensity trends: rapid efficiency gains in industry Between and 8 Romania achieved significant energy efficiency gains in industry: the specific energy consumption in the non-metallic minerals and paper industries dropped by 9 percent/year. Efficiency gains in the largest industrial consumers, ie, the chemical and steel sectors, were lower: the unit consumption of steel and the energy intensity of the chemical industry decreased by around 2 percent/year. Overall, indusbalance every year (for those consuming over 1, toe/year) or every two years (for those consuming -1, toe/year). Those energy balances make energy consumption monitoring possible and pave the way for improvements in the production process. The Romanian Fund for Energy Efficiency, created in 3, offers investment subsidies to industrial companies and other large consumers for energy efficiency and renewable projects. To date, 18 companies have benefitted from those subsidies, which amount to US$12.1bn and which should permit substantial energy savings (36.8 ktoe/year). Industrial companies can also benefit from loans from Structural Funds to finance investments in energy-efficient equipment. In 7, Romania adopted a law on the promotion of CHP, including guarantees of origin of electricity from high-efficiency cogeneration Energy consumption trends: sinking consumption between 199 and Energy consumption in Romanian industry decreased by 65 percent between 199 and ; it then declined by.6 percent/year until 8 and fell dramatically in 9 (-24 percent), due to the global economic crisis. and currently accounts for 5 percent of total industrial energy consumption ( percent in ). The share of energy-intensive branches in industrial energy consumption is high, at 64 percent. The chemical industry accounts for 32 percent of industrial energy consumption, followed by steel (23 percent). The non-metallic minerals and paper industries account for just 7 percent and 2 percent, respectively. Figure 11: Energy consumption of industry, by source Biomass Heat Electricity Gas Oil Coal/Lignite Figure : Industrial energy consumption Mtoe Figure 12: Energy consumption of industry, by branch Other Paper Non metallic minerals Chemical Steel Gas is the most consumed fuel in Romanian industry (46 percent in 9, compared with 41 percent in and over 6 percent in 199). The share of electricity in industrial consumption has almost doubled since, from 13 percent to 25 percent, to the detriment of coal (from 16 percent to 8 percent). The shares of oil and biomass remained stable, at around 12 percent and 4 percent, respectively. Heat consumption dropped by nearly 8 percent between and 9, 5 Romania Country reports

6 trial energy intensity decreased by 6.9 percent/year between and 8. Figure 13: Trends in the energy intensity of industrial branches Figure 15: Trend in energy intensity of manufacturing and structural effect % %/year Total* Steel Chemical Cement** Paper *Including construction and mining ** Non metallic minerals %/year -1.5% % % % -5. Real variation Change at constant structure Structural effect The share of industrial CHP in the electricity consumption of Romania s industrial sector has been growing steadily since, from 4 percent to 11 percent, although that level remains below the EU average. Figure 14: Share of industrial CHP in industrial consumption 18% 16% 14% 12% 1 8% 6% 4% 2% The energy intensity of the manufacturing industry, ie, excluding mining and construction, fell by 4.2 percent/year between and 7. One third of that improvement was due to efficiency gains in industrial branches and two thirds were linked to structural changes, namely a structural shift toward less energy-intensive industrial branches. Between and 8, the share of the equipment branch in the industrial value added in Romania grew by more than 8 percentage points. All information or data provided by Enerdata, in any form, is the property of Enerdata and is protected in each country by national laws governing intellectual property. All information or data provided by Enerdata is copyright protected, inclusive of material appearing in a hard copy format or electronically. Data provided by Enerdata are based on compilation and analysis of the best sources in the industry. Enerdata has agreements with those providers to use and publish this data. All pictures Copyright ABB Country reports Romania 6