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CEZ schedules for 2019 similar investments to those in the last years

2 November 2018
Electricity
energynomics

Investment in the power distribution grid in Oltenia will stay at ambitious levels, said Adrian Borotea, Group Strategy and EU Agenda Division Director at CEZ Romania, at an event organized by energynomics.ro.

In reference to the remuneration of the invested capital, Adrian Borotea said that the negotiations with the regulator led to “values that could be higher, but which are fair”. “The additional percentage for the really new investments to be made is a good thing. To the extent that the other parameters in the methodology, such as the maintenance costs, the costs with own technological consumption (CPT), are recognized and transferred into tariffs, we consider that a lower level of WACC is fair for everyone”, CEZ official explained.

The WACC (weighted average cost of capital) indicator is an important element in calculating the regulated rate of return, diminished by ANRE from 7.7, at present, to 5.66%, starting from January 1, 2019. The measure was publicly criticized by the ACUE Federation, according to which the new regulatory framework “will lower the volume of investments for the modernization of networks”.

With regard to CPT, Adrian Borotea also mentioned the “very ambitious” targets set by the new Methodology, especially in low-voltage networks, for the end of the forthcoming five-year regulatory period to begin on January 1, 2019. “We had very good results every year, and recently, the measures implemented by CEZ were proposed by the Competition Council to ANRE to be applied by other distribution operators, too”, Borotea said.

The network maintenance program should be implemented without cutting any corners, CEZ’s representative added, adding that “all maintenance contracts are subject to auctions on SEAP and we, alongside our service providers, have been able to reduce the cost and increase the volume every year.”

“We keep up with our ambitious plan for smart metering implementation in our network, though a little more relaxed, now, taking into account the priorities set by the regulator and the less stringent targets coming from Brussels,” added Adrian Borotea.

He pointed out that distribution grids are ready to receive the electricity volumes that will be generated by prosumers once all legal and regulatory issues have been clarified and the Environmental Fund Administration’s support scheme will stimulate such small distributed production.

Distributie Oltenia ensures power distribution to 1.42 million customers in seven counties: Dolj, Arges, Olt, Gorj, Valcea, Mehedinti and Teleorman.

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