News 20111205 Winter

1. News December 5th, 2011
Winter nightmare for the energy sector
The drought has halved hydropower production, and a reactor at
Cernavodă could be off Friday. Cold in January to increase gas
imports, which reached a record price. In addition, Petrom expensive
domestically produced gas.
Severe drought in the last 6 months has already raging in the energy sector and the situation will
worsen with the onset of winter, when it’s expected to increase the consumption of electricity and
gas.
The situation is difficult on all levels. The hardest hit is the hydropower production, the cheapest in
the country, which has halved since September. Hidroelectrica had to activate the force majeure
clause in its contracts, so as to reduce the production deliveries. Trihenea Constantin, general
manager, estimated that this situation will last until spring.
Problems in Cernavodă
And NPP has already serious problems of reactor cooling water. Danube since last week fell to a
level of -163 cm, representing the first stage warning within restrictions plan.
Eng. Paul Keisch Page 1

2. News December 5th, 2011
"If it doesn’t rain in the coming days and the level continues to fall further, Friday, December 9th,
will take the decision to close 1 of 2 nuclear reactors at Cernavodă", said sector sources. That has
not happened since 2003.
According to submitted data by the Romanian Waters as was requested by the newspaper
"Adevărul", the Danube at Cernavodă will continue to fall next few days and will arrive Friday at -
186 cm.
"Today, at the hydrometric station Cernavodă, Danube levels ranged at -177 cm, below warning
stage I (-162 cm) of the water use and restrictions plan in poor times, and will reach, on December
9th, a level of -186 cm, being 24 cm below the first warning level. Thereafter, Danube levels will
register a slight increase, respectively by 3 cm, reaching on December 11th to a level of -183 cm,
which will be situated 21 cm below the first warning level", show data from the Romanian Waters.
Very low temperatures in January
Yesterday, Danube flow from entering the country was 1,850 cubic meters per second (m3/s),
representing 35% of the multiannual average in December (5,200 m3/s) and the filling degree of 36
major reservoirs is 54%.
The problem is that hydro and nuclear energy deficit, which is the cheapest, has to be supplemented
by electricity from coal and gas, much more expensive and pollutants sources, which puts a greater
pressure on final price. This however, given that the final price for the population will increase by
about 2.5% on January 1st only because of subsidies for renewable energy, without taking into
account the problems caused by drought.
Speaking of gas, also here is expected a difficult winter. December will be quiet, but in January we
expect very low temperatures of -15˚C to -20˚C, energy sector sources have said. Under these
conditions, gas consumption for heating will increase greatly. Additional requirements will be
imported from Russia, where prices have now reached record levels, with 25% higher than in early.
Romanian gas more expensive
In addition, from October 1st, Petrom expensive domestic gas production by 6%. GDF Suez, former
Distrigaz Sud, accepted the new conditions and requested further from National Regulatory
Authority of Energy (ANRE) to increase final tariffs to cover costs.
"This increase in the domestic gas production prices –due to higher imported gas prices under the
necessary conditions to increase gas imports in winter – will be reflected in regulated tariffs, in the
shortest time", said GDF Suez officials.
Instead, according to information held by newspaper "Adevărul", those from E. ON did not accept
the increase and are in negotiations with several importers to ensure their gas needs. "We analyze
the market to see what solutions we can call, so as not to be needed to ask an additional price
increase", said company sources. The final price of gas and energy for industrial consumers should
be increased by 2 digits, for operators to cover all costs, says the head of E.ON Romania, Frank
Hajdinjak, in late October. For population, gas prices won’t increase by April 1st, 2012 according to
an ordinance adopted by the government last summer.
Eng. Paul Keisch Page 2