Romania Solar Energy Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

Romania Solar Energy Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

The Romania Solar Energy Market is expected to register a CAGR of more than 9% during the forecast period of 2022 - 2027. With the COVID-19 outbreak in Q1 of 2020, the Romania Solar Energy Market has witnessed a negative impact in terms of production and supply. In 2020, Romania's renewable energy production has been declined significantly due to induced lockdown. Though there was an impact on the supply chain during H1 of 2020, however, the energy sector in the region managed to grow in 2020. Factors such as the growing demand for renewable energy and upcoming investments in the energy sector along with supportive government policies are major factors driving the market's growth. However, the high initial investment cost and long investment return period on projects are expected to restrain the Romania solar energy market during the forecast period.

Key Highlights

• Supportive government policies such as Energy Efficient House program, Contract for Difference scheme (CfD), etc. are expected to drive the solar energy market during the forecast period.
• The government of Romania has announced plans to add around 7GW of new renewable capacity comprising around 3.7 GW of solar energy by 2030. This is likely to create immense opportunities for Romania's solar energy market in the future.
• Increasing solar energy installation capacity and upcoming projects in the country is likely to drive the Romania solar energy market in the forecast period.

Key Market TrendsSupportive Government Policies to to Drive the Market

• Romania has announced numerous policies to support the renewable energy sector, especially solar energy. These policies helps in meeting the obligations set by the European Union (EU) in terms of greenhouse gas emissions through its legislative package.
• To replicate the growth during 2012-2016, the government is considering multiple programs to drive solar power installations. In June 2020, the government approved a memorandum to implement support mechanisms such as the Contract for Difference scheme (CfD) for low-carbon electricity. Under CfD, the producers enter into a private contract with the nominated counterparty, under which the parties agree on a strike price. The producer sells the electricity at market prices. If the market prices are below the strike price, then the counterparty pays the difference to the producer, and if the market price is above the strike price, the producer pays the difference to the counterparty.
• The CfD ensures a consistent electricity price to power plant owners, protecting them from market risks associated with electricity price volatility. Given the success of the CfD in the UK and existing obstacles presented by uncertain electricity prices for the power market in the country, CfD is expected to be a major driver for the market.
• Under the 'Energy Efficient House' program announced in May 2020, the government will provide up to EUR 15,000 for households that are installing new equipment aimed at increasing the energy efficiency of their homes.
• In 2020, Romania‘s Ministry of Environment has allocated over USD 63.7 million for the Casa Verde Fotovoltaice (green PV home) scheme to support residential solar installations under the country’s net metering regime.
• According to International Trade Administration 2021 report, the Roamia's total electricity production, the renewable energy production holds significant share which comprised of hydropower by 34%, wind by 15%, and photo-voltaic above 7%.
• Therefore, the above government policies are expected to drive the Romania solar energy market in the forecast period.

Increasing Solar Energy Installations and upcoming projects to Drive the Market

• Romania's solar potential is widespread throughout the country. Romania benefits from about 210 sunny days per year across the south-eastern, the west, the center, and the eastern parts of the country are the best places to place a solar park. Investment in the renewable sector, like solar, is expected to meet the rising demand for electricity in the country.
• According to IRENA’s Renewable Energy Statistics 2021, the total capacity of renewable energy sources, as of 2020, was 11,141 megawatts (MW). Solar energy accounts for an installed capacity of 1,387 MW, which was significantly higher when compared to the value of 2013 (761 MW).
• In 2021, Core Value Capital has announced plans to invest over EUR 800 million into new photovoltaic parks in Romania over the next seven years. The new parks are expected to have a total capacity of 1 GW.
• In 2021, approximately 7% of the energy generated in the country was from Solar PV sources. The government of Romania committed to the European Council (EC) to increase its renewable generation to 30.7% by 2030.
• In 2020, the Romanian Government has announced a plan to invest in the National Energy System estimated at EUR 12.48 billion. The plan aims to boost renewable energy projects, especially solar energy projects, thus, driving the market's growth during the forecast period.
• Hence, the above points indicate that increasing solar energy installed capacity along with upcoming projects are expected to drive the Romania solar energy market during the forecast period.

Competitive Landscape

The Romania solar energy market is moderately consolidated. Some of key players include Sunshine Solar Energy s.r.l, Amerisolar, Altius-Solar, NIVUS GmbH, and Danagroup.hu, amongst others.

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