Natural gas flows have undergone important changes in Romania, both due to the decline of old fields and the emergence of new sources, but the structure of the national transport system has largely remained the same. This stands to change, however, as there are many projects for regional interconnection underway which bring about exciting opportunities for the country.
Romania’s National GAS Transport System (NTS)
The first pipe ever built as part of the National Transport System (NTS) was put in use in 1914. According to Transgaz, the National Gas Transport System Operator, a large part of it needs rehabilitation and modernization. The technical state, however, has remained at appropriate levels, due to the fact that maintenance and development work has been done throughout this time.
Romania is presently interconnected with Ukraine, Hungary, the Republic of Moldova and Bulgaria. All these countries currently rely on Russian gas as their only source of supply. Recent years have seen sustained efforts to diversify supply routes with the obvious purpose of increasing security, and also to ensure better conditions for price competitiveness. Romania already has the smallest dependence on imported gas and new discoveries in the Black Sea are likely to strengthen its position in the region.
Gas transport infrastructure plays a crucial role in this context. As such, Transgaz is faced with the challenge to develop a natural gas transport corridor, in the shortest possible, that will ensure both the necessary degree of interconnectivity at European level and enough capacity to serve the domestic market.
BRUA Pipeline: A Game Changer
The developments that took place in recent years have revealed that the most important supply routes for Europe will start from the Caspian and the Black Sea. BRUA (Bulgaria-Romania-Hungary-Austria) pipeline is a key element of infrastructure that needs to be developed to ensure that natural gas can be made available across the region.
The pipeline will lead into Austria’s Baumgarten Hub, which means Romania will essentially be able to export gas to Western Europe.
The construction work for BRUA has begun and is set to unfold in two phases. Phase I is under development and progressing according to schedule, while construction of Phase II is envisioned to start this year and be finalized in 2022. However, Transgaz is still assessing the economic viability of the project. For the time being only 40% of the transport capacity has been reserved which is not enough to justify the investment. Transgaz has been working on a new round for capacity reservation, but the dates have been delayed several times, most recently until October 1st 2019.
The main supply source that the new pipeline aims to serve is the offshore Neptun Deep perimeter, under concession by ExxonMobil and OMV Petrom. The FID for this project has been postponed indefinitely, because of the stalemate created between producers and authorities. These stem from disagreements regarding the Offshore Law and other more recent changes that have been passed such as GEO 114/2018.
Green Light Granted for the Black Sea – Podisor Pipeline
In May 2019, Transgaz obtained the right to start working on the pipeline that will retrieve natural gas from the Black Sea and connect it to the NTS as well as BRUA. Niculae Badalau, Minister of Economy noted: “It is a very big step we take to create value around the Black Sea resources. The pipeline built by Transgaz will allow us to direct the natural gas that we will exploit in offshore perimeters both to BRUA - so towards export, contributing to regional and European energy security, as well as to the National Gas Transmission System - that is, for internal use, enabling local communities and economic agents in the country to have access to these gas resources that are particularly important.“
Romania’s National POWER Transmission Grid (PTG)
The lines and electric stations that make up Romania’s power transmission grid were mostly built between 1960 and 1980. The last few years have seen extensive maintenance, modernization and development works, and older electrical installations have largely been replaced. But additional efforts are necessary in order to meet the current necessities of the country. Since the beginning of 2019 Transelectrica, the Romanian electricityTSO, has accelerated 38 investment projects focused on modernization and refurbishment, and has launched six new procurement contracts for the upgrading of electrical installations that are approaching the end of their life-cycle.
At present, Romania faces an imbalance: 80% of the electricity production is concentrated in the Southern area of the country and only 20% in the Northern part.A key benefit of closing the 400kV national ring is facilitating the transport of electricity from over-production areas to wide-spread consumer areas in the most efficient way, and save money all while doing so.
The new infrastructure will also increase the interconnection capacity and open new opportunities for exporting electricity to neighboring countries. This project has been included in the European List of Projects of Common Interest (PCI) because it contributes to the EU’s strategy for the trans-European energy infrastructure.
About 64% of the construction has been completed already, and the remaining 36% consists of segments that are either in work or in different phases or preparation.The total investment amounts to approximately €200 billion. Funding is being ensured through both local and European Union programs, and the various segments will be put into operation gradually up until 2027.
Constructing the 400 kV Metropolitan Ring of Bucharest
The demand for electricity in the capital city has been increasing at a faster pace than the country’s average, and the trend is expected to continue in the coming years. Closing the 400 kV ring that will serve Bucharest has therefore become a priority. The first decisive step in this direction has been done in June 2019, when Transelectrica launched the tender for the acquisition of a study, which will help identify the optimal solutions for this development.
E-Mobility: The Future Might Just Be Electric
Sales of electric and hybrid vehicles in Romania reached 2,285 units in the first five months of 2019, up by 70% compared to the same period of 2018, according to statistics of the Association of Car Manufacturers and Importers – APIA. However, their share in the overall car sales remains rather low, at 3.4%.
Like many other countries, Romania decided to implement a support scheme to encourage the shift to a sustainable transport. Rabla Plus program, initiated by the Environmental Fund Administration (AFM), offers the highest subsidy in Europe towards the purchase of a new electric vehicle.
“Rabla Plus is dedicated to plug-in and fully electric cars, and Romania in fact offers a €10,000 incentive for going electric, the highest subsidy in the EU.” Dorin CORCHES, Vice President, AFM
Naturally this initiative needs to be complemented by an efficient charging station infrastructure, and Romania has seen notable progress in this regard: “One challenge we are noticing is people’s perception that their cars will run out of electricity, but in reality, the network of stations is already developed enough that it allows for travel pretty much anywhere in the country” explained Aurel Arion, CEO of Renovatio Trading, the first company to build a public electric vehicle charging station in Romania. “We decided to build the infrastructure well aware that it would take a long me to recover our investment (a fast charge station can cost up to €35,000). Things are moving slowly but surely, we are starting to see more competition in the market, which is a very good thing.”
One notable initiative in this area is NEXT-E project: 40 fast charge stations will be installed in Romania, of which 19 by E.ON and 21 by MOL. Up to now, 9 charging stations have been set into operation in Moldova area. By the end of August, E.ON intends to also implement this project on the route Iasi – Gheorgheni – Tirgu Mures, which will thus become an “electric highway”, with the charging infrastructure available on the whole route.
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