Romanian Social Democrats Threaten No-Confidence Motion Over Pwr Holding Proj

Iancu stressed they are determined to draft a no-confidence motion if the country’s privatization authority AVAS gets the government’s approval for the setting up of the national power holding.

Inacu said, citing article 108 of Romania’s Constitution, that the Government Decision on the setting up of the national power holding is unconstitutional.

Moreover, Iancu pointed out the other political parties, except the National Liberal Party (PNL), which represents the government, will vote in favor of the social democrats’ motion.

Iancu added the creation of an integrated company in the energy sector will have direct impact on all companies that will not be included in the future holding, adding these companies will be left outside.

Iancu also said he holds information according to which the ministries of economy and justice disapprove of this decision.

Iancu told a press conference Sunday the power holding would have control over the country’s energy market and would be able to impose high tariffs without having to answer to anyone.

The Romanian authorities plan to set up a the power holding to compete with major European utilities, such as Czech group CEZ AS (BAACEZ.PR) and Italy’s Enel SpA (EN), by merging its remaining state-owned power suppliers and producers and putting a stop to some of its privatization plans.

Romania still retains control of power producers Hidroelectrica, Nuclearelectrica, Termoelectrica, Turceni, Rovinari and Craiova, as well as three power suppliers belonging to former monopoly Electrica.

Authorities said the power holding will be worth between EUR20 billion and EUR24 billion, with high return of investment, which is seen at EUR800 million by 2012.