When former communist dictator Nicolae Ceausescu began to steer Romania down the road of heavy industry, environmental concerns receded into the background. Times, and mindsets, have now changed and the country has embarked on a concentrated program to shore up environmental protection measures in order to meet the guidelines laid down by the European Union. Romania is also expected to play a key role in the region owing to its vast potential for sources of renewable energy.

Local electricity supplier Energy Holding, which has recently been acquired by Geneva-based Société Bancaire Privée, has been at the forefront of a growing trend towards environmentally friendly projects. One of the company’s investments in hydro-energy is expected to provide a springboard for the country’s efforts to reduce pollution. In 2004, Energy Holding acquired five small hydropower plants along the Topolog River in Romania.

When the company initially assumed control of the plants they were in a decrepit condition. Enrique Ferrer, President of Energy Holding, recalls, “At that time, pipelines were broken everywhere. The turbines were in very poor condition and the generator control systems needed to be upgraded. We have invested quite a bit and today we are seeing the positive effects of our efforts. Furthermore, we have already exceeded all of our contractual obligations.”

The company’s modernization program has involved an extensive upgrade of the plants’ equipment and a marked increase in their power generation capacity. Operational safety has also been significantly improved. The first stage of the program consists of investments estimated at more than €1 billion ($1.35 billion).

“With regards to alternative sources of energy, we are very actively looking into the possibilities of building wind power and biomass plants in Romania,” Mr. Ferrer says. He notes that building these types of plants will require the implementation of certain aspects of legislation in addition to the necessity of obtaining the requisite permits.

“We are monitoring these developments and we will continue to pursue this process and hopefully, in the future, we will be able to commence work on a biomass power plant,” says Mr. Ferrer.

Meanwhile, the government is pressing ahead with its promotion of green energy. Minister of Economy and Commerce Varujan Vosganian says a recently introduced initiative calls for an increase in hydro-energy production, and the development of unconventional energy sources. “We will start a program for cross-support from other sectors comprising wind, solar and biomass energy,” he says. The goal is to see the country’s energy production broken down into 32-33 percent renewable, 30 percent nuclear-based, with the remainder to be gleaned from hydrocarbon, coal, gas and other sources.