The case regarding suspicions of false emissions reporting at the Oltenia Energy Complex. What the Ministry of Energy says

Complexul Energetic Oltenia (CEO) reported CO₂ levels well below expected values, with question marks over the correct payment of emission allowances (ETS), according to an investigation by journalists from the Organized Crime and Corruption Reporting Project (OCCRP), published in early December by Follow The Money. Estimates show that CE Oltenia made savings, following these reports, of over 250 million euros, in eight years.

The Oltenia Energy Complex is based in Târgu Jiu, but includes in its composition the power plants from various localities, which report “unusually low” emissions of carbon dioxide emissions, according to an investigation published by the Rise Project at the same time as Follow The Money.

Reports of low pollution correlate with the fact that residents near Turceni, Rovinari or Ișalnița frequently wake up under a cloud of ash that invades houses, yards and gardens.

HotNews addressed a set of questions to the Ministry of Energy regarding the situation at the Oltenia Energy Complex regarding the reporting of carbon dioxide emissions.

The institution responded that a possible retroactive invalidation of the ETS certificates used by Complexul Energetic Oltenia (CEO) in recent years would have a significant impact, with “serious effects”, both on the company and on consumers.

How the Oltenia Energy Complex came from huge losses in profit, following the energy crisis

The Oltenia Energy Complex produces coal-based energy. It currently covers around 15% of national energy consumption.

The majority shareholder of the Oltenia Energy Complex is the Romanian state, through the Ministry of Energy.

According to data from Termene.ro, by 2022, the company recorded huge losses, reaching up to 1.5 billion lei in 2021.

Following the energy crisis, when energy became very expensive, the company turned a profit. Basically, after the huge loss in 2021, CEO made a profit of 3.5 billion lei in 2022. In the following years, when prices stabilized, this profit decreased, reaching 317 million lei in 2024, on a turnover of 3.2 billion lei.

State aid for restructuring

Romania committed through PNRR to close several units in 2026, in the context where coal energy is the most expensive and polluting. It is also expensive because of the obligation to purchase carbon dioxide emission certificates. In 2024, it purchased over 1.2 million certificates, being paid for with a grant of approximately 386 million lei.

More precisely, the Oltenia Energy Complex is obliged to implement a restructuring plan, conceived in 2020, which involves the replacement of coal-fired power plants with 8 photovoltaic parks, of about 700 MW, in Turceni, Rovinari and Ișalnița, and the development of gas capacities, with a power of about 1,300 MW, in Turceni and Ișalnița.

The European Commission has approved, in 2022, state aid of 2.6 billion euros for restructuring. The largest part of this aid was received by the Oltenia Energy Complex, but no progress was registered in relation to the restructuring.

Ministry of Energy: There would be serious effects on the company

Asked what impact the retroactive invalidation of the ETS certificates used by the CEO in recent years would have on Romania, the Ministry of Energy replied that it does not have the competence to do a full impact assessment.

“However, as an exercise, we appreciate that the retroactive invalidation of the ETS certificates used by the Oltenia Energy Complex (CEO) in recent years would have a significant impact on the company's activity,” stated the Ministry of Energy.

According to the institution, in such a scenario, the Oltenia Energy Complex would be put in a position to buy additional certificates (for undeclared pollution), which would seriously affect the financial stability of the company. In the context where the company is one of Romania's important energy producers, the effects could also be felt on prices.

“First of all, such an invalidation could lead to the need to purchase additional ETS certificates, which would entail additional costs for the CEO, with serious effects on the financial stability of the company. Also, in the context where the CEO is one of the important energy producers in Romania, such an impact could also affect the consumers”, stated the Ministry of Energy.

The Ministry of Energy neither denies nor confirms

The Ministry of Energy claims that it has not been officially informed, in recent years, about confirmed suspicions of underreporting of carbon dioxide (CO₂) emissions of the Oltenia Energy Complex (CEO), according to the answers sent to the questions addressed by HotNews.

The institution also states that it does not have internal reports that confirm or deny the data published in the investigations carried out by Follow The Money and OCCRP.

According to the Ministry of Energy, the monitoring, verification and validation of reports on greenhouse gas (GHG) emissions are carried out within the European and national mechanisms, by the authorities and bodies designated by the legislation in force. Among them are the National Environmental Protection Agency (ANPM), the National Energy Regulatory Authority (ANRE) and other authorized institutions.

“In the situation where such suspicions are officially brought to the attention of the Ministry of Energy by the competent institutions, the ministry supports their clarification, within the limits of its legal attributions,” reads the response sent.

No independent audit of ETS certificates

Asked if it has started or intends to start an independent audit on the purchase of ETS certificates by the CEO, the Ministry of Energy answers that it has no legal powers in this area and, consequently, has not initiated such an audit.

Regarding the access of ETS auditors to the facilities of the Oltenia Energy Complex, the Ministry specifies that the verification process is based on the data and documents provided by the economic operator, but also on additional requests for information or clarifications, in accordance with European and national regulations.

Direct access to facilities depends on the procedures and methodology established by the competent authorities. The analyzes required to determine greenhouse gas emissions are carried out in RENAR accredited laboratories. A RENAR accredited laboratory for coal is SE Ișalnita.

The Ministry shows that, according to the information sent by the company, the analysis bulletins were made available to the accredited companies that checked the emission calculation methodology, as well as ANPM, in the framework of the annual reports.

Who signs the emission reports

The annual emissions reports of the Oltenia Energy Complex are signed by the company's executive management or the person designated with responsibilities in the field of environmental protection and compliance with ETS regulations. The Ministry of Energy says that direct attributions in the validation of emissions reports.

The Ministry of Energy also stated that it does not have the capacity to inform the European Commission about possible suspicions of under-reporting, nor the competence to assess a possible risk of infringement against Romania. According to the institution, such steps can only take place following checks and audits carried out by the competent authorities in the field.