The deal was signed in Bucharest by Ming Yang CEO Chuanwei Zhang and Bobby Paunescu. Although he is best known in Romania as a film director and producer, Paunescu is also chairman of the Paunescu Corporation that controls Romanian developer Speranta & Succesul.
Whether or not the agreement will actually lead to the construction of a 200MW wind farm in Romania remains to be seen — in 2012 Chinese manufacturer Sinovel announced a deal to develop some 1.2GW in wind projects in the country that led nowhere, and the Ming Yang agreement is in an early stage — but it is evidence of the continued interest among some Chinese turbine manufacturers in establishing a presence in the country.
Indeed, the week after Ming Yang's Romanian agreement was signed, rival Chinese manufacturer Goldwind revealed that it had actually installed the first 2.5MW Goldwind turbines on a 50MW project in Constanta, around 170 kilometres east of the capital Bucharest. The project will be operated by Romanian developer Monsson Alma, which also developed the 600MW Fantanele-Cogealac wind farm owned by Czech utility CEZ. Goldwind said that all 20 turbines to be used on the project would be shipped to Romania by year end, while installations and grid connection are expected to be completed in June 2014. Goldwind said its expansion into Romania's wind market "marks the next important achievement in [its] strategy for international expansion and product localisation".
Time pressure
Although incentive cuts have made Romanian wind energy investments less attractive than they once were, and the grid has started to be an issue as the country's cumulative wind capacity approaches 2.5GW, Chinese investors such as Goldwind and Ming Yang are not alone in still seeing opportunities in the market. All investors must move quickly, however, as the green certificates at the heart of the Romanian incentive system will only be issued to wind farms up and running by 2016. Analysts note that Romania may also be a starting point for expansion elsewhere in Europe.
"Ming Yang expects to leverage this opportunity in Romania as a base of expansion into Europe and intends to supply competitive wind power solutions to customers in the region," explained Ming Yang CEO Zhang. Ming Yang said the planned investment in the wind farm, which is expected to feature its 2MW low-wind turbines with 110-metre rotor, amount to some EUR 400 million. Ming Yang had already installed 4.5MW of its turbines in neighbouring Bulgaria a few years ago and had planned to expand in that market with a 120MW wind farm before the government began to roll out a series of measures penalising the sector, scaring away Chinese and western investors.
Ming Yang has also been exploring other opportunities in Romania, alongside other Chinese manufacturers. On the other hand, while Sinovel was also scouting out other smaller opportunities in Romania's wind energy besides the 1.2GW deal that fell flat, it appears to be sidelined. In general, analysts say Sinovel's international expansion efforts appear to have suffered a major setback after intellectual property infringement charges were pressed in the US last summer.
Aside from getting their turbines up and running on Romanian ground, Chinese turbine manufacturers are also thought to be eyeing opportunities to open up manufacturing facilities in the country. "Romania could be a productive hub," says Ciprian Glodeanu, a partner at the Bucharest office of legal firm Wolf Theiss. "It is part of the EU and there's a qualified labour force, but the cost of labour is cheaper." Its geographical location could also position it well for exporting to other eastern European markets, Ukraine, Russia and the Middle East.
