Romania’s potentially pivotal step away from coal

In January, Romania tried to expand production at a major lignite mine. Now it’s switching the fuel used at a key power station from coal to biomass. The penny appears to have dropped.

In what could potentially become a pivotal moment for the transition to clean energy in Romania, the country’s energy ministry on November 27 claimed to have signed a memorandum of understanding with US firm American Biocarbon Delaware LLC to switch the fuel burnt at the huge Paroșeni power station from coal to biomass.

The ministry, which claims the deal could be worth as much as 400 million euros, says that the biomass used at Paroșeni would be made entirely from the byproducts of Romanian agriculture. 

Paroșeni would be the first coal-fired power station in the country to make the switch and is not a random choice. It is located in the heart of the Jiu Valley, long the centre of Romania’s coal industry and home to militant miners who have long made Romanian governments nervous. Even the country’s long-term dictator, Nicolae Ceaușescu, was not immune. 

In 1977, miners in the Jiu Valley came out on strike to protest against low wages, obligatory (and unpaid) overtime, and unsafe working conditions. It was the largest strike in the history of communist Romania to that point, and so shaken was the regime in Bucharest that it sent two politburo members to Lupeni, the centre of the strike, to negotiate. 

In 1990, just a few months after Ceaușescu had been toppled and killed, the Jiu Valley miners were brought to Bucharest by the country’s new president, Ion Iliescu, to Bucharest to put down a peaceful demonstration against his government. 

Over two days in June, the miners wielded considerable force to disperse peaceful protesters, killing at least seven and injuring thousands.  

Just over a year later, in September 1991, they were back, storming the government building in the north of the capital and forcing the resignation of Petre Roman, Romania’s prime minister, who had fallen out with Iliescu. 

They tried again to topple the government, by then centre-right, in 1999, setting off for Bucharest only to be turned back after scuffles with the security forces. 

Decline of an industry 

Since then, both the political and economic clout of Romania’s miners has waned. 

Coal is no longer as crucial to the generation of electricity as it once was, subsidies for the loss-making sector have been cut and production has plummeted from over 60 million tonnes in 1989 to around 18.2 million tonnes in 2022. 

The number of miners has fallen drastically too: from more than 50,000 in 1990 to fewer than 5,000 today. 

This has had a devastating effect on the economy of the Jiu Valley. According to the European Union, employment rates in the valley are significantly lower than the Hunedoara county average at 39.4 per cent and 53 per cent, respectively. 

According to Energy Minister Sebastian Burduja, “this strategic partnership aligns us not only with our European objectives of decarbonisation and sustainability, but also offers new hope for the social and economic rejuvenation of the Jiu Valley.” 

The need for ‘effective investment’ 

Although the carbon intensity of the Romanian economy has fallen over the past twenty years, it remains very high. Currently over 70 per cent of Romania’s total energy usage is dependent on fossil fuels, with transport, industry and residential heating being the main consumers of high carbon fuels.  

However, only 34 per cent of electricity generation is fossil fuel based, with the rest coming from renewables and nuclear power. 

A World Bank report published last month revealed that Romania could raise its national income by almost three times in the next three decades while taking action to improve resilience against climate change and reduce carbon emissions, if it continues broader economic reforms. 

The report, however, also notes that the investments needed to develop a decarbonised energy sector alone is estimated at 356 billion US dollars by 2050, representing about three per cent of the country’s cumulative GDP over the time horizon. 

“While the challenges of decarbonisation are considerable, with the proper mix of structural, social and economic reforms, and effective investments underlined by public, private and EU funds, Romania can improve living standards while achieving its climate goals,” said Marina Wes, World Bank country director for the European Union. 

The report—the first to look at climate and development in an EU member—notes that Romania is on track to achieving its 2030 target of reducing emissions by 55 per cent from 1990 levels. In fact, it already reduced emissions by 53 per cent between 1990 and 2018. 

However, achieving its pledge of carbon neutrality by 2050 will require substantive and coordinated policy action and funding. 

To reach net zero by 2050, Romania needs to implement a massive electrification programme replacing direct consumption of fuels with energy generated from renewable sources.  

Mixed messaging 

The planned switch from coal to biomass at Paroșeni is a good start.  

Less welcome was news in January this year that more than 100 hectares of forests in the Gorj region would be cut down to expand a lignite mine. The decision to expand lignite mining—taken by the government in great haste by emergency ordinance—ran counter to the decarbonisation process, which is a part of Romania’s National Recovery and Resilience Plan (NRRP), which envisions phasing out coal entirely by 2032. 

“Expanding the Timișeni-Pinoasa mine in Gorj county to a capacity of eight million tonnes per year of lignite not only increases CO2 emissions but also means that more than 100 hectares of forest will be wiped out,” warned Alexandra Doroftei, coal campaigner at Bankwatch Romania, an environmental watchdog. 

“Deforestation and then burning lignite will have a double negative effect on the environment by increasing CO2 emissions and reducing the absorption capacities.” 

In March, in a timely intervention, the European Union blocked the extension of the mine, threatening to withhold NRRP funding should it go ahead. The news from Paroșeni suggests that the Romanian authorities have taken note.

This article has been amended to state that the Romanian Energy Ministry signed an agreement with an entity named American Biocarbon Delaware LLC, and not American Biocarbon, as previously stated.

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