Romania seeking to postpone shutdown of lignite power plants

BUCHAREST (Reuters) -Romania will seek European Commission approval to postpone the closure of its lignite-fired power plants by up to two years, Energy Minister Sebastian Burduja said on Monday.

The government has committed to phasing out lignite - or brown coal - from 2026 under its European Union-funded recovery aid package, although Burduja said he would temper expectations for now on a change to the date.

State-owned lignite power holding CE Oltenia has partnered with three private companies - OMV Petrom, Tinmar and Alro Slatina - to build solar parks and gas-fired power plants as part of Romania's energy shift.

The company has already received 1.2 billion lei ($254.85 million) in EU-approved state aid under a restructuring plan which includes clear deadlines to phase out coal. It has shut down some 950 MW worth of coal-fired power units.

"Unfortunately, because of delays, the lignite shutdown will not coincide with the coming online of these new projects, which might create difficulties for the national power grid," Burduja told a news conference.

The minister said he would go to Brussels for talks on the postponement this month.

Burduja also said Romania's gas stores are filled beyond capacity and the country could avoid having to import supplies this winter if the weather remains temperate.

Romania relies less on Russian gas than neighbours in the region, producing about 90% of its required gas locally through state producer Romgaz, oil and gas group OMV Petrom and Black Sea Oil & Gas (BSOG).

Burduja also said that he was in favour of keeping in place a government support scheme which caps power and gas prices for households and other consumers to avoid price fluctuations, particularly given conflicts in the Middle East.

The European Union state has been capping gas and power bills for various users and compensating suppliers for the difference since November 2021. Under current legislation the price caps are in place until March 2025.

($1 = 4.7087 lei)

(Reporting by Luiza Ilie and Jason Hovet; editing by Toby Chopra, Jason Neely and Ed Osmond)