CET Govora, Romania’s first independent producer of electrical and thermal power, has become a role model for the country’s energy sector in its commitment to international standards and its emphasis on reliable quality and good practices as well as very competitive prices.
The company, which is based in Valcea and overseen by the local city council, specialises in the production and trade of electric and thermal power; supply of materials, equipment and spare parts, fuel, and services; maintenance and repairs; and provision of water and sewage services. CET Govora achieved profits of €1 million in the first six months of 2009 in spite of the global financial crisis.
In 2002, CET Govora implemented a Quality Management System based on SR EN ISO 9001/2001, and it has also been certified ISO 14001/2004 for environmental management. CET Govora has been steadily building up its list of customers and serves both the public and private sectors.
Co-generation: greater efficiency, lower costs
CET Govora provides power and water for Valcea as well as for Baile Olanesti and Calimanesti, for which it has long-term concessions. It aims to extend its services to other cities. It is a member of the professional association COGEN Romania, which is affiliated with COGEN Europe; COGEN refers to “co-generation”, or the production of both thermal and electrical power at the same time. “Co-generation results in greater efficiency and lower costs,” explains Mihai Balan, General Manager.
CET Govora employs coal from a coal mine around 40 km from the company’s production facility; the mine’s resources ensure CET Govora’s needs for the next 40 years. Because of its reliable source of power, CET Govora was launched as a pilot project and has proven the potential of an independent company operating in Romania’s private sector.
Mihai Balan says, “CET Govora is the first company of its kind that came out of a local authority. Many companies have followed our example. Today, there are 35 CET companies, all united under the COGEN Romania umbrella, of which I serve as president.” CET Govora has strengthened its ties to the EU by forming partnerships not only with COGEN Europe but also with Euro Heat and Power in Brussels and German company LISEGA. “We formed these partnerships in order to help implement a strong regulatory environment in Romania’s heat and power sector,” he points out.
Mihai Balan is very positive about CET Govora’s prospects, and plans to list the company on the stock market once the global financial crisis has lessened. He says, “This company has very strong growth potential as well as the capacity to get involved in other fields. We are trying to attract an investment fund which can finance some of the projects we are planning. We hope that once the financial crisis has passed, we can move forward with these efforts.” Possible projects include biomass initiatives and efforts to use some of the waste ash from CET Govora’s production, for example in road building.
Outlining CET Govora’s investment appeal, Mihai Balan says, “We have a very good allocation of CO2. We also have a very close source of fuel, which means we don’t have transportation costs. We also have a stable market in this area; around 96% of the city of Valcea is connected to our distribution network. We are working on a project to build a second coal-fuelled power station.”
CET Govora signs bilateral contracts with other power producers as allowed by Romania’s energy laws. Mihai Balan explains, “We sign bilateral contracts with as many producers as possible, working only with producers which we view as trustworthy. We also sign contracts through which we can obtain energy at a lower rate than our selling price.”
Effort to reduce CO2 emissions
CET Govora is a major player in Romania’s effort to reduce CO2 emissions. Mihai Balan says, “We achieved a 20% reduction in 2007 and over the period 2008 to 2012 we are contributing to the reduction for the whole country.”
The EU launched a €485 million programme to reduce CO2 emissions in Romania over three phases. CET Govora has access to non returnable EU funding for both environmental issues and economic development. Mihai Balan says that he is hoping to access around €50 to €60 million, with which he hopes to reduce emissions not only of CO2 but also of other harmful emissions, and to reach 75% efficiency. “We are already ahead of other companies in reaching these goals, even though others began before we did. Our goal is to be first in receiving financing, and we are well placed because our colleagues have been slower than we have been,” he explains.
Mihai Balan adds that CET Govora is committed to improving Romania’s international image by demonstrating the potential of a reliable, well-run Romanian company.