More renewable capacity, primarily photovoltaic plants with similar production profiles, is entering operation and intensifying price competition. Under these conditions, the commercial management of assets can no longer rely solely on obtaining the most accurate possible forecast and securing a fixed price. The performance gap increasingly comes from the asset manager’s ability to react during the day, correlate actual generation with developments on the intraday and balancing markets, and anticipate not only the volume of the imbalance, but also the direction of the price associated with it. We spoke with representatives of 4P Renewables about how this shift is affecting producers’ revenues, the tools needed to manage an increasingly complex portfolio and the benchmarks that would allow commercial performance to be assessed properly.
A market with more renewable capacity does not simply mean more energy available. It also means increasing pressure on prices during the hours when generation is concentrated, as well as the need to find the best commercial destination for every megawatthour. Today, asset management is expanding beyond the boundaries of the power plant itself and linking generation with storage, supply and consumption.
4P Renewables approaches asset management primarily from a commercial perspective. The company’s services cover energy sales, contracting through PPAs, the management of green certificates and guarantees of origin, reporting to authorities and back-office activities. Field operation and maintenance remain outside this scope.
This distinction is important. A power plant may perform well technically and generate in line with its design parameters, but its financial result increasingly depends on how the energy is offered, traded and balanced.
Photovoltaic projects are relatively easy to build, and development and operating costs have become affordable. The success of the technology creates a new problem: plants largely generate during the same hours. Production profiles may vary depending on location, orientation or the use of trackers, but these differences do not fundamentally alter the overlap in solar generation. When supply rises simultaneously, electricity prices fall. In some intervals, they can become negative.
Installed capacity and estimated annual generation are therefore no longer sufficient to assess a project. What matters is the actual price obtained for the electricity delivered during the hours when the plant generates.
ACCURATE FORECASTING NO LONGER SOLVES EVERYTHING Under the traditional model, a producer sought the most accurate forecast possible in order to reduce the difference between contracted electricity and actual generation. Participation in a balancing responsible party allowed deviations among several participants to be partially offset. Changes to balancing market mechanisms and the emergence of negative prices have made this logic more complex. A surplus no longer automatically generates revenue, while a deficit does not always represent a cost. The outcome depends on the direction of the system and the imbalance price in the relevant interval. As a result, the most accurate forecast is not necessarily the most profitable in every situation. Representatives of 4P Renewables emphasise the importance of correlating the forecast with actual generation and, above all, with estimating the direction of the imbalance price. No weather forecast can eliminate deviations entirely. The asset manager needs to know how to position the plant commercially when deviations occur. A good estimate of the direction of the balancing market may be more valuable than reducing the physical imbalance at any cost.
Commercial management therefore focuses not only on forecast accuracy, but also on the financial outcome of real-time decisions.
DECISION-MAKING SHIFTS TO THE INTRADAY MARKET The day-ahead market establishes an initial position, but it does not close the commercial game. Changes in intraday prices and imbalance expectations can create new opportunities or require the position to be corrected quickly.
During an interval with negative prices, a producer can buy back intraday the electricity previously sold and reduce or close its position. Depending on the price difference, shutting down the plant may avoid a loss or contribute to a positive commercial outcome.
The decision is not automatic, however. Stopping generation simply because the day-ahead market price is negative may be the wrong choice if the imbalance price favours keeping the plant in operation. The asset manager must simultaneously compare actual generation, the contracted position, the intraday market and the balancing market signal.
This shift moves the centre of gravity from planning carried out the previous day towards reacting during the day. Value is created through a sequence of decisions, not through a single offer.
From this perspective, managing a power plant is beginning to resemble the management of a portfolio of financial instruments, says Alex Pintea, CEO and co-founder of 4P Renewables. Trading strategies, risk rules and the ability to decide quickly when electricity should be sold, bought back, kept in position or physically curtailed are all required.
Large power plants generally have metering systems that provide the necessary data. The challenge lies in integrating those data into the commercial process and in the speed with which information can be converted into a decision.
Specialized software is becoming commercial infrastructure. It must collect real-time data, compare generation with the forecast, update exposure and support trading decisions. Automation takes over repetitive tasks without eliminating the human role.
As operators increasingly use tools with comparable capabilities, performance will depend on the quality of strategies, risk discipline and the experience of those interpreting market signals. Differentiation will come precisely from the combination of technology and commercial judgement, believes Răzvan Ionescu, Commercial Director at 4P Renewables. “The way energy is managed is becoming a major source of differentiation in a highly competitive market.”
Many investors still seek a fixed price and extensive guarantees. This is entirely understandable in a volatile market, particularly when lenders require a minimum and predictable level of revenue. A fixed price does not eliminate risk, however; it changes the way that risk is distributed. In a physical PPA, the counterparty taking on part of the commercial risks will price those risks into the contract, meaning the producer may accept lower revenue in exchange for stability. An alternative is a virtual or financial PPA concluded with a consumer. Under a Pay-as-Produced structure, the producer can financially fix the price for its entire output without physically delivering the electricity to the consumer. The electricity continues to be sold on the market, while the producer remains exposed to the risks associated with physical trading and balancing. The PPA therefore provides protection against price movements, but it does not make the revenue risk-free. The difference between the baseload price and the value of the solar profile can become significant. A scenario built around a general average electricity price risks overestimating the revenue of a photovoltaic plant, because the plant generates precisely during the hours when solar supply puts pressure on the market. Investors must choose between predictability and controlled market exposure. The choice is not the same for every project. The size of the plant, lender requirements, the structure of bilateral contracts where these exist, the presence of a CfD and risk tolerance all narrow or expand the room for optimization. “The objective is for imbalance not to be treated exclusively as an unavoidable penalty. With the right information and strategy, the cost can be reduced and, in certain intervals, can even be turned into revenue,” says Răzvan Ionescu.
The difficulty of evaluating an asset manager does not come only from the complexity of the market. Romania still lacks sufficiently clear commercial benchmarks for comparing the performance of the services provided.
The most relevant indicator remains the actual price obtained from the market, or capture price, compared with the theoretical result available and the expected revenue. This comparison shows how much of the potential value was captured through forecasting, trading and imbalance management.
Gross generation does not tell the whole story.
Nor can the average day-ahead market price describe performance on its own. What matters is the revenue weighted by the plant’s actual production profile, imbalance costs and the outcome of intraday interventions.
What is still missing are market data that would allow a promised result to be benchmarked, meaning the investor cannot easily see whether the performance offered is good, average or weak compared with similar projects.
Romania’s market is attracting many investors with no previous local experience, notes Alex Pintea. Some try to transfer commercial models used in other countries directly, even though markets across the region do not operate identically. Others first seek to understand the processes, costs and responsibilities specific to Romania.
The lack of an established model is producing unusual experiments. An investor with four power plants may choose four different asset managers in order to compare results and later select a single provider. Another may want to retain commercial decision-making in-house, while requesting local support during the initial period of operation.
In such structures, the allocation of responsibility becomes critical. Who decides when the plant is shut down, who authorises the repurchase of electricity and who bears the outcome of a wrong position?
The market has not yet established uniform answers.
Contracts, transparency levels and remuneration mechanisms differ from one provider to another. Recognized good practices are still lacking for energy trading and for measuring the asset manager’s contribution.
Representatives of 4P Renewables believe this diversity of approaches will eventually need to be filtered into a more repeatable and predictable model. Producers’ experience, investor requirements and local particularities could, over time, form a playbook for the commercial management of renewable projects.
Optimizing generation alone has its limits. As the market matures, operators will use software with similar performance and develop comparable capabilities. The next source of value will come from combining assets, Răzvan Ionescu anticipates. Renewable generation can be managed together with batteries and different consumption profiles. Storage shifts electricity between time intervals, while flexible consumption can absorb part of the generation when supply is high and prices are low. Consumers, however, remain an underutilized part of the equation. At present, most commercial optimization focuses on generation: intraday trading, imbalance management, hedging and, increasingly, battery integration. The next step is to bring consumption into the same equation. For this to happen, consumers need to be monitored and contracted according to their actual consumption profile, rather than only through standard profiles. Metering capable of recording hourly load curves would allow suppliers to build products with differentiated prices depending on the time of consumption and would create a direct economic incentive to shift consumption towards hours when electricity is more abundant and cheaper, Răzvan Ionescu stresses. As hourly price differences increase, consumption flexibility could become a source of value comparable to generation optimization. The market would then no longer be only about finding the best moment to sell a megawatt-hour, but also about connecting generation with the consumer able to use it at the right time. From this perspective, the virtual power plant is becoming more than a technological concept. It provides the commercial framework in which producers, batteries and consumers can be coordinated to reduce exposure and maximize revenue. 4P Renewables is pursuing the development of such an integrated model. The company provides outsourced services to producers that obtain a supply licence but do not want to build the entire administrative, operational and reporting infrastructure internally. In a market where multiple plants generate the same electricity during the same hours, profit no longer depends solely on the asset owned. It comes from the ability to connect generation with storage, supply and consumption and to turn a portfolio of power plants into a coordinated commercial system.
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The article also appeared in the print edition of Energynomics Magazine, Q3 2026 issue.
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