Renewable energy

Meeting Romania's energy security, competitiveness and decarbonisation pathway requires deep investment into transmission and distribution infrastructure, but siloed electricity and gas planning approaches risk wasting billions in duplicated or underutilised infrastructure. Romania needs to invest approximately €21 billion by 20301 to transform its power generation system. This will involve supporting coal phase-out through new wind, solar, and nuclear power, with additional investments needed for comprehensive electrification of final demand, integrating flexibility sources — especially new storage capacity — and repurposing limited gas infrastructure to support hydrogen and biomethane uptake. Upgrading electricity transmission and distribution networks alone will require investment of €16-18 billion by 2030. New European modelling from Fraunhofer 3 suggests that integrated planning across sectors and nations could save up to €500 billion EU-wide by 2050. Critically, over 70% of savings would come from cross-sectoral coordination alone. Integrated planning would coordinate electricity, gas, transport and heating infrastructure investments across sectors to minimise total requirements needed to meet system adequacy and decarbonisation goals. Three structural barriers have prevented the organic emergence of integrated planning in Romania. First, the regulatory frameworks approve investments based on demonstrated connection requests rather than scenario-based modelling, limiting anticipatory planning. Second, network operators are compensated through sector-specific tariffs, creating disincentives to consider the other sector’s existing infrastructure or upcoming plans. Third, institutional gaps prevent coordination as Romania has no authority with a mandate to oversee cross-sectoral planning. Existing authorities, such as ANRE, the independent energy regulator, focus on sector-specific regulation, while local authorities lack the resources and access to accomplish integrated planning. Without addressing these structural barriers, Romania risks billions in stranded assets while facing increased pressure from the EU to adopt integrated planning through the Energy System Integration Strategy, the TEN-E Regulation revision and the European Grids Package. To harness the benefits of infrastructure planning, Romania should: Clarify the remit of integrated planning and explore how it could be embedded within the current institutional set-up, likely within the Ministry of Energy or the General Secretariat of the Government. The body will need adequate capacity to undertake structured cross-sector consultation, and regular integrated network planning. Amend ANRE’s decision-making to approve investments based on cross-sector modelling and scenario analyses. Projects that can demonstrate a reduction of cross-sector duplication should be fast tracked. Conduct a cross-sector review to identify potential infrastructure duplication, with consideration of cross-sector methodologies used in the upcoming EU cross-border energy infrastructure framework as outlined in the European Grids Package. Major infrastructure development should require a cross-sectoral component to their cost-benefit analysis and consider how this infrastructure would fit into Romania’s transition trajectories. Embed integrated planning into the Romania's National Energy and Climate Plan and other strategic documents, and support modelling capacity with funding from the Multiannual Financial Framework or ETS revenues as well as technical assistance from the European Commission or the Organisation for Economic Cooperation and Development Download the full Policy Paper Nadia Maki, EPG Senior Researcher Nadia Maki is a Senior Researcher within the Energy Systems Department of EPG. She is an energy policy researcher focused on renewable energy financing, green technology and innovation and emerging economies. Before joining EPG, Nadia worked as an independent evaluator for renewable energy financing schemes for the UK Department of Energy Security and Net Zero, evaluating schemes such as the Contracts for Difference scheme and the Capacity Market scheme. Nadia has extensive experience using theory-based evaluation methods. She has also contributed to projects for DG CLIMA, DG Environment, the Research Council of Norway, UN Women, the World Health Organization and ActionAid. Nadia holds an MSc in Climate Change, Development and Policy from the Science Policy Research Unit and the Institute of Development Studies at the University of Sussex and a Bachelors of Arts degree from Queen’s University in Canada.  Contact: nadia.maki@epg-thinktank.org

The second CfD auction clears at record low solar prices, but fails to meet quota for wind The second Contracts for Difference (CfD) auction has cleared at record low solar prices, but has failed to meet quota for wind. For wind power, the total tendered capacity was 2 GW, with a maximum strike price of €80/MWh. The concluded contracts, though, cover 60% of the intended capacity, with the lowest strike price going down to €65.17/MWh (a 211 MW project in the Constanța county). The full intended capacity for solar was procured with 1.49 GW of capacity awarded contracts. The lowest strike price is €35.77/MWh, which was part of a project broken up into smaller bids. The previous auction procured the full 1.5 GW intended capacity with strike prices of €51/MWh for solar and €65/MWh for wind. The scheme was modified for the second auction with the removal of the maximum capacity allowed per bidder, a more flexible increase in the total procurement cap and the establishment of a Do No Significant Harm principle. Are clearing prices this low sustainable? Many developers who were not awarded contracts in the first round declined to submit bids in the second auction, likely anticipating they would not be competitive with the eventual low clearing prices. There is a sense of desperation in the solar market. The abundance of PV projects creates a rush to ‘secure something’. A possible reason for these low strike prices could be this market pressure -- likely in combination with underestimations of the number of hours with negative prices and penalties for imbalances -- have resulted in bids that risk delivering without even marginal profits. Furthermore, low strike prices from €35-45/MWh send a signal to future potential off-takers who may believe these prices are reasonable to expect in a PPA and, when confronted with a significantly higher offer, may be pushed further into a ‘wait and see’ mode, waiting for a better deal which the market cannot actually provide. Low clearing prices are exacerbated when considering that inflation may outstrip the strike price as indexation only occurs every three years and is only adjusted if inflation exceeds 10%. However, inflation, measured through the Harmonised Index of Consumer prices, mostly remains in the single digits and the likely result is developers coping with several years of a much lower strike price than is appropriate. This is a high residual risk for developers to shoulder, especially on top of the existing development and CAPEX risks. It is unclear how developers could balance with such low revenue – even with a PPA. Besides, there is a risk that bond penalties may soon begin to look more appetising. Based on results for wind, it is clear that many developers are not willing to accept the risk as the CfD was not able to secure more than 60% of its intended procurement. CfDs should be designed to enhance market participation Developers bid into the wholesale market based on the lowest price they can afford that still offers them enough profit to run. CfD generators, who receive a top up payment regardless of spot market bid price, are incentivised to sell as much electricity as possible on the spot market at once. This gaming behaviour discourages participation of players who are not able to bid at artificially low prices and is forbidden under other CfD schemes such as in the UK, where regulatory scrutiny can minimise this behaviour, with the risk of voiding contracts. A possible solution to such a behaviour would be to amend the profit-sharing mechanism so CfD generators are allowed to make enough profit to encourage real bids and increase participation in other markets – like balancing or ancillary services which could help balance the grid. Another related element which is incentivising CfD generators to operate in ways that hinder grid balancing is the discouragement of energy storage. This is because electricity generated from solar or wind, stored, discharged and fed into the grid cannot be considered for CfD payments. Introducing storage colocation would allow generators to self-curtail during periods of negative pricing and opt-in when profit could be made. This would favour the inclusion of larger, more experienced players, who may be able to reduce their bids (which are currently too high to participate). The state would still benefit financially, though from a smaller margin – but the real benefit would be to the grid. Separating out storage changes the way a company optimises its projects, likely downsizing the amount of storage attached to a project. This kind of interference in project design optimisation increases likelihood of an unbalanced project and, eventually, an unbalanced grid. Despite ambiguity in the EU legislation, Romania should push for this allowance in the national CfD scheme as it has been successfully implemented in other countries. Ireland’s comparable Renewable Energy Support Scheme allows for the inclusion of co-located storage, subject to stringent requirements such as metering behind the project and the demonstration that the asset only stores electricity generated by the supported project. Where do we go from here? Rightly or wrongly, the CfD is viewed as a proxy for price signalling to consumers and developers alike. With so much of the market trapped in an inert ‘wait and see’ mode, unsustainably low prices can create more uncertainty and keep future actors inert, waiting for stability. Given Romania’s target of delivering at least 10 GW of new solar and wind capacity by 2030, there should be focus on projects which are financially stable and they should be incentivised to act in a way that reduces pressure on the grid. Download the Op-Ed Nadia Maki, EPG Senior Researcher Nadia Maki is a Senior Researcher within the Energy Systems Department of EPG. She is an energy policy researcher focused on renewable energy financing, green technology and innovation and emerging economies. Before joining EPG, Nadia worked as an independent evaluator for renewable energy financing schemes for the UK Department of Energy Security and Net Zero, evaluating schemes such as the Contracts for Difference scheme and the Capacity Market scheme. Nadia has extensive experience using...

Discuțiile recente din spațiul public privind prelungirea funcționării centralelor pe cărbune sub motivul securității energetice reflectă capacitatea administrativă limitată a României de a gestiona înlocuirea acestor centrale cu alternative moderne, de a asigura reconversia profesională a angajaților și de a atrage fonduri europene destinate acestor investiții, precum și lipsa unui plan coerent de tranziție către surse sustenabile de energie. În anul 2025, securitatea energetică nu mai poate fi evaluată exclusiv prin prisma capacităților existente de generare sau a rezervelor de combustibili fosili. Securitatea energetică nu se rezumă la cât de multă energie putem produce în mod convențional, ci depinde și de cât de repede și de eficient putem adapta infrastructura la noile realități tehnologice, climatice și economice. Stabilitatea sistemului energetic depinde tot mai mult de flexibilitate, diversificare, interconectare, integrarea surselor regenerabile și capacitatea de a gestiona în timp real variațiile de producție și consum. În acest context, autoritățile trebuie să conștientizeze că menținerea producției pe cărbune devine din ce în ce mai dificilă, că invocarea securității energetice ca argument este în mare parte înșelătoare, și că în zonele miniere efectele asupra sănătății publice sunt semnificative. Nu în ultimul rând, este necesară asumarea unui calendar realist care să asigure predictibilitate și să permită României menținerea obiectivului de închidere completă a centralelor pe cărbune, tratând cu responsabilitate resursa uman din acest sector. Realitatea economică: centralele pe cărbune sunt ineficiente, subvenționate, falimentare Într-o perioadă de incertitudine geopolitică, presiuni economice și evenimente meteorologice extreme tot mai frecvente, sloganul menținerii nedefinite a centralelor energetice pe cărbune din rațiuni de securitate energetică ignoră un fapt fundamental: cărbunele reprezintă o sursă de energie ineficientă și poluantă, cu costuri socio-economice și climatice pe care nu ni le mai putem permite. Menținerea în funcțiune a acestor centrale frânează procesul decarbonizării și tranziția sistemului energetic către sustenabilitate, reziliență și echitate, menținând și un cost ridicat al energiei. Contrar percepției răspândite, centralele pe cărbune nu mai oferă de ani buni un avantaj competitiv real. În România, costurile ridicate de operare, la care se adaugă obligația achiziționării de certificate de emisii de CO2, întreținerea unor echipamente complet învechite și pierderile structurale le fac profund nerentabile. Companii precum Complexul Energetic Oltenia (CEO) supraviețuiesc doar datorită subvențiilor de stat și fondurilor europene de tranziție. CEO se confruntă cu mari dificultăți financiare încă din 2014, atât în ceea ce privește operarea cât și plata certificatelor de emisii de CO2, pentru care au avut loc injecții masive de lichidități din fonduri publice – de exemplu, un împrumut de salvare de €251 milioane în 2020, urmat de €241 milioane în 2021 pentru achiziția certificatelor de emisii de CO2 din 2020,€535 milioane în 2022 pentru perioada 2021-2022 și €57 milioane euro în 2025. Descarcă comentariul integral Alexandru Ciocan, EPG Senior Researcher Alexandru Ciocan joined the EPG team at the end of 2023 as a Senior Researcher within the Energy Systems Department. He brings nearly a decade of experience in hydrogen-based technologies, renewable energy sources, and lithium-ion batteries. Between 2012 and 2021, he held various research positions at the National R&D Institute for Cryogenic and Isotopic Technologies – ICSI Râmnicu Vâlcea. Alexandru has also been actively involved in energy policy. From 2021 to 2023, he served as Senior Advisor in the Energy Policy and Green Deal Department within the Romanian Ministry of Energy, contributing to the development of national strategic documents. Since 2017 he holds a PhD in Engineering Sciences, awarded jointly in 2017 by IMT Atlantique (France) and the University Politehnica of Bucharest. Contact: alexandru.ciocan@epg-thinktank.org

This policy position outlines Romania's progress, challenges, and recommendations in implementing Renewable Energy Acceleration Areas (RAAs) in alignment with the revised Renewable Energy Directive (RED III), as well as expert recommendations for making this process effective and sustainable. The paper is part of RENewLand project, which aims to ensure sustainable and science-based approaches for the designation of renewable acceleration areas across three Eastern European countries: Romania, Bulgaria and Hungary. Drawing on expertise from other European states, the project focuses on building capacity among public authorities, industry associations, civil society, and academia to undertake integrated spatial planning for renewable energy. By developing methodologies that balance economic viability with environmental and social factors, RENewLand provides practical tools to mitigate conflicts and streamline the siting and approval processes for solar and wind farms, thus accelerating the region's renewable energy transition. Through RENewLand, a methodology for RAA designation was developed that integrates economic, environmental, and social criteria, with pilot testing underway in Romania, in Prahova and Brașov counties. Despite progress in transposing RED III into national legislation, the process faces delays in finalising legal frameworks and initiating mapping and designation efforts, because of fragmented governance and limited capacity. Romania's implementation challenges have to do with low inter-ministerial coordination, insufficient technical capacity across key institutions, and the absence of a centralised spatial data platform for effective integrated planning. These barriers are compounded by financial constraints that have prevented the Ministry of Energy from formally launching the RAA mapping process, threatening Romania's ability to meet in time its national renewable energy targets. To address these challenges, this policy position recommends: establishing a permanent multi-stakeholder working group to oversee implementation; adopting a GIS-based multi-criteria methodology for possible site selection; prioritising degraded and non-agricultural lands for renewable energy development, avoiding areas that are sensitive from a biodiversity perspective; developing a centralised open-source spatial data platform; integrating biodiversity safeguards and addressing the cumulative impact between these areas and any other existing or planned infrastructure with strategic environmental assessments; developing, implementing and monitoring rules to mitigate the effects of development in each acceleration zone on nature (mitigation rulebook); strengthening stakeholder engagement processes with a particular focus on local communities in future acceleration zones; ensuring alignment between RAA planning and national grid expansion strategies. A successful implementation of these recommendations requires the adoption of the draft Government Emergency Ordinance (GEO) on RED III transposition, followed by institutional capacity building and technical training. Insights from RENewLand's pilot areas will provide evidence to support national-scale implementation. By adopting a coordinated, science-based, and inclusive approach to spatial planning, Romania can establish a resilient framework for renewable energy development that accelerates the clean energy transition while maintaining environmental integrity and social cohesion. RENewLand is part of the European Climate Initiative (EUKI) of the German Federal Ministry for Economic Affairs and Climate Action (BMWK). The opinions put forward in this study are the sole responsibility of the author(s) and do not necessarily reflect the views of the Federal Ministry for Economic Affairs and Climate Action (BMWK). Mihai Constantin, EPG Senior Researcher Mihai Constantin is a Senior Researcher at the Energy Policy Group, where he focuses on energy policies on topics such renewable energy and decarbonisation policies. As part of the Energy Systems Department he has contributed to a series of reports and policy papers addressing topics such as offshore wind development, solar energy potential, coal phase-out etc. At the same time, he engaged in advocacy activities with different stakeholders in order to promote the collaboration between public authorities, industry, and civil society on topics such as the development of offshore wind (through the Black Sea Renewable Coalition) or designating acceleration areas for renewable energy. Mihai has a Master Degree in European Economics at Bucharest University of Economic Studies. He has expertise on public policies in the fields of energy, climate change and economics. He also occupies a position of Senior Energy Expert at the World Bank. Before joining EPG, he worked for WWF Romania as Climate & Energy Manager and as Advisor on Public Policies in the Romanian Parliament. Contact: mihai.constantin@epg-thinktank.org

În luna noiembrie 2021, România a introdus schema de plafonare a prețurilor la energie electrică și gaze naturale prin Ordonanța de Urgență (OUG) 118/2021, pentru a sprijini consumatorii în sezonul rece 2021-2022. Măsura a fost adoptată la aproximativ un an după liberalizarea completă a pieței de energie electrică (1 ianuarie 2021) și gaze naturale (1 iulie 2020), ca urmare a creșterii prețurilor post-liberalizare, a impactului crizei Covid-19 și a conflictului din Ucraina. Ulterior, schema a fost prelungită în mod repetat pentru a proteja consumatorii, în special cei vulnerabili, de efectele creșterii prețurilor energiei în întreaga Uniune Europeană. Schema a avut rolul de a tempera șocurile din piața de energie cauzate de războiul din Ucraina, cu consecințe în ceea ce privește inflația, puterea de cumpărare a populației, cererea agregată și creșterea economică. La mai bine de trei ani de la introducerea schemei, începutul anului 2025 a fost marcat de o incertitudine privind prelungirea acesteia. Incertitudinea era determinată de faptul că termenul de aplicare era prevăzut să expire în luna martie. În februarie 2025, Guvernul României a adoptat OUG 6/2025, care prevede extinderea perioadei de plafonare a prețurilor pentru energia electrică cu încă trei luni, până la finalul lunii iunie 2025 și pentru gaze naturale cu un an, până la finalul lunii martie 2026. Conform notei de fundamentare a OUG, autoritățile justifică prelungirea prin contextul geopolitic din Ucraina, temperaturile scăzute de la mijlocul lunii februarie și sprijinul acordat de România Republicii Moldova după sistarea tranzitului de gaze prin Ucraina. Totuși, se poate aprecia că argumentele prezentate sunt insuficiente și necesită o fundamentare mai solidă pentru a susține în mod convingător poziția exprimată. Deși temperaturile au fost scăzute în luna februarie, România a avut o toamnă târzie și o primă jumătate de iarnă cu temperaturi mult mai ridicate decât media obișnuită a perioadei. Astfel, golirea stocurilor de gaze naturale nu poate fi explicată doar prin temperaturile scăzute din februarie, ci și printr-o problemă de gestionare, iar acest aspect este automat transpus în noile facturi. Un alt motiv invocat de autorități a fost sărăcia energetică, cu referire la raportul Băncii Mondiale din 2024. Această publicație oferă o analiză succintă menită să evidențieze potențialul impact determinat de eliminarea schemei de plafonare a prețurilor la energie asupra consumatorilor casnici. Documentul propune o serie de măsuri imediate pe care autoritățile le-ar putea lua în considerare pentru a atenua impactul asupra facturilor consumatorilor casnici. EPG va publica ulterior o analiză dedicată problemelor structurale care influențează prețurile energiei. Noua publicație va include o componentă extinsă privind sectorul industrial, în continuarea celei prezente, vizând recomandări de politici publice pe termen mediu și lung. Clarificare, 11.06: Odată cu apropierea reliberalizării pieței de energie electrică, la finele lunii iunie, noile oferte ale furnizorilor permit deja o imagine de ansamblu privind gama de prețuri din facturile consumatorilor casnici (link). Față de aceste valori, publicația EPG din 21.05.2025, în care au fost analizați factorii determinanți de formare a prețului energiei la consumatorul final, estima o valoare medie a prețului de 1,156 RON/kWh. Estimarea noastră s-a bazat exclusiv pe componentele de preț reflectat în factura consumatorilor casnici și a plecat de la evoluția prețului energiei electrice pe piețele centralizate în anul 2024, precum și pe actualizarea tarifelor de rețea și a elementelor fiscale. Pe de altă parte, așa cum se arată în publicație, analiza EPG nu a inclus costurile potențiale ale furnizorilor cu dezechilibrele din piața de energie electrică, deși acest element are un impact în factura finală. De asemenea, costurile cu „profilarea” ofertei de furnizare la tiparul specific de consum al consumatorului final are un impact de preț. Cumulat, estimăm că aceste două componente pot adăuga aproximativ 15% la estimarea noastră inițială de preț mediu, în funcție de zonă și de comportamentul specific de consum. Alexandru Ciocan, EPG Senior Researcher Alexandru Ciocan become a member of the EPG team at the end of 2023 and started working as a Senior researcher in the Energy System Programme. Previous he has working extensively for almost 10 years in the field of hydrogen-based technologies, renewable energies sources and lithium-ion batteries. Between 2012 and 2021 he held various research positions at the National R&D Institute for Cryogenic and Isotopic Technologies – ICSI Rm. Valcea. Nevertheless, Alexandru gained experience in the energy policy, following his contribution to the national strategic documents from the position of Senior Advisor within the Energy Policy and Green Deal Department into the Ministry of Energy of Romania between 2021 – 2023. Since 2017 Alexandru holds a PhD in engineering sciences from the IMT Atlantique as well as the University Politehnica of Bucharest. Contact: alexandru.ciocan@epg-thinktank.org

Offshore wind energy is a crucial element of the European Union’s decarbonisation plan. With substantial untapped potential in the Black Sea, Romania has the opportunity to become a regional leader, particularly following the adoption of its Offshore Wind Law in 2024. Offshore wind energy has emerged as a pillar of the EU's decarbonisation policy. The EU is aiming for 60 GW of offshore wind capacity by 2030 and 300 GW by 2050. Romania, with significant untapped technical wind potential in the Black Sea estimated between 76-94 GW, could become a regional leader in offshore wind development. Romania's adoption of the Offshore Wind Law in 2024 (Law No. 121/2024) is a major step forward in developing its offshore wind sector. However, there are still gaps that need addressing. A key issue is the timeline for actions outlined in the law, such as the public availability of information on the terms of reference for the Expert Study, which was supposed to be approved by September 2024. Additionally, the lack of a legally binding target is a concern, as it would help enforce timelines for secondary legislation and provide greater clarity to investors. Simplifying the permitting process is also crucial, given that developers must currently obtain approvals from multiple authorities. Offshore wind development in the Black Sea should prioritise environmental protection, given the basin's unique characteristics and biodiversity risks. The enclosed nature of the sea, with limited water exchange and anoxic deep layers, makes it particularly sensitive to disturbances. Localised environmental studies are essential for understanding and mitigating the risks posed by offshore wind construction and operation. Lessons from Romania’s onshore wind projects and international offshore wind development can further guide environmentally responsible practices. Romania adopted its Maritime Spatial Plan in November 2023, marking a step forward in aligning maritime activities with sustainable development. However, the MSP faces challenges, including insufficient stakeholder engagement during its development, which resulted in limited input from sectors such as fisheries, tourism, and local authorities. Romania's infrastructure and supply chain readiness are key to unlocking its offshore wind potential, but gaps remain. Future production from offshore wind, onshore wind, and new nuclear capacities will need accelerated grid reinforcements and new HVDC lines, to ensure the evacuation of electricity. The Port of Constanța, while partially equipped, needs an upgrade to handle the storage, assembly, and transport of offshore wind components in a scenario intended to promote rapid growth and a higher volume of installed capacities. A global shortage of installation vessels presents another bottleneck, exacerbated by Romania’s lack of domestic shipbuilding capacity following the Damen Mangalia shipyard’s insolvency. To address these challenges, Romania could adopt Sector Deals modelled on the UK and Poland examples. This paper was written as part of the project BLUECEE – Strengthening Policy and Governance Capacity for Blue Energy in Central and Eastern Europe. The project is part of the European Climate Initiative (EUKI) of the German Federal Ministry for Economic Affairs and Climate Action (BMWK). The opinions put forward in this report are the sole responsibility of the authors and do not necessarily reflect the views of the Federal Ministry for Economic Affairs and Climate Action (BMWK). Mihai Constantin, EPG Researcher Mihai Constantin is a Researcher at the Energy Policy Group, where he focuses on energy policies on topics such renewable energy and decarbonisation policies. As part of the Energy Systems Department he has contributed to a series of reports and policy papers addressing topics such as offshore wind development, solar energy potential, coal phase-out etc. At the same time, he engaged in advocacy activities with different stakeholders in order to promote the collaboration between public authorities, industry, and civil society on topics such as the development of offshore wind (through the Black Sea Renewable Coalition) or designating acceleration areas for renewable energy. Mihai has a Master Degree in European Economics at Bucharest University of Economic Studies. He has expertise on public policies in the fields of energy, climate change and economics. He also occupies a position of Senior Energy Expert at the World Bank. Before joining EPG, he worked for WWF Romania as Climate & Energy Manager and as Advisor on Public Policies in the Romanian Parliament. Contact: mihai.constantin@epg-thinktank.org

To reach climate neutrality by 2050, the European Union has set a 55% emission reduction target for 2030 and the European Commission has proposed a 90% reduction target for greenhouse gas emissions by 2040. Romania, through its multiple strategies and plans, has set out a vision for gradually decreasing its emissions. While these documents reflect significant strides forward for the energy transition, especially by committing to a coal phaseout calendar by 2032, they are fraught with inconsistencies and partly rely on sizeable investments in fossil capacities. Various projects on nuclear and hydro energy are also constantly announced with limited assessment of their suitability in an increasingly decarbonised power sector. In this report, we assess Romania’s energy transition pathway. The European Gas Market Model and the European Power Market Model developed by REKK were utilised to understand the impact of Romania’s plans on emissions and the energy market and to see how Romania could resize its fossil capacity investments and achieve a carbon-neutral power sector in 2040. The models simulate a fully functional and liberalised energy markets to show the impact of different measures on wholesale energy prices. Based on the modelling results several important conclusions can be drawn: Romania can reach a completely decarbonised electricity production mix in 2040 with no security of supply risks by aiming to have no more than 3.5 GW1 of total installed gas-fired capacities by 2030 and by focusing more on wind power and a higher deployment of storage technologies. In contrast, the investments outlined in Romania’s National Energy and Climate Plan (NECP) do not ensure a decarbonised energy sector by 2040. The Romanian power sector would emit 9.2 MtCO2 in 2030 (which can be halved in a lower-gas scenario) and 3.5 MtCO2 in 2040, at slightly higher wholesale electricity prices. Replacing natural gas with hydrogen in 2035 in the all-installed capacities (as outlined in Romania’s Long-Term decarbonisation Strategy) would mean that these assets would no longer be utilised. This is because replacing gas with hydrogen would significantly deteriorate the cost-competitiveness of these capacities, immediately reaching a utilisation rate lower than 0.1%, given the high fuel prices of 82 EUR/MWh in 2030, according to renewable hydrogen cost estimations presented in the draft National Hydrogen Strategy. There is therefore a significant risk that even ‘hydrogen-ready’ investments would continue to operate on fossil fuels for economic reasons, consequently not achieving their promised emissions reductions. A higher focus on wind energy (17.7 GW onshore and 7.3 GW offshore in 2040,compared to 13.1 GW altogether in official plans) can contribute to decarbonising the power sector by 2040. Romania appears to have a regional competitive advantage in wind production. The market value of wind remains higher than that of solar for all modelled years, while lower wind investments are expected in Hungary and Bulgaria. Even with higher renewable shares than presented in official documents, Romania’s power sector can deliver on security of supply requirements. The higher balancing reserve requirement can be accommodated through investments in storage (reaching 880 MW in 2030 and 3.4 GW in 2040) covered by existing hydro capacities, new storage installations and, until 2035, gas power plants. An annual installation of 800 MW rooftop PV and 120 MW in battery can further decrease balancing pressures and slightly decrease wholesale prices (by about 1.1 EUR/MWh in 2040). A high renewables scenario would also have a positive impact on the electricity trade balance. In either scenario, Romania becomes a net exporter of electricity from 2030. 17.5 GW of solar capacities as well as 17.7 GW onshore and 7.3 GW offshore wind is sufficient to achieve a decarbonised power sector by 2040. Existing hydro power facilities are key for balancing a renewables-dominated power sector. However, new investments in hydro capacities (including 300 MW in small hydro installations and a 1 GW pumped hydro capacity that would come online in 2032) would only have a limited effect on electricity prices and security of supply – assuming the mentioned battery storage investments are realised. Hard coal and lignite phaseout are manageable from a security of supply perspective, even with lower than planned investments in gas capacities. Based on market prices alone, the modelling results show that coal fired production will rarely be economical from 2025 (expected capacity factor of less than 1%). New nuclear energy capacities can contribute to achieving a decarbonised power sector, even if the planned investments suffer delays. The modelling results show that slight delays in the construction of new nuclear (two new conventional CANDU reactors and 460 MW of small modular reactors) do not pose security of supply risks, even in a lower-gas scenario of 3.5 GW installed gas capacities. Even with such delays, Romania would continue to be a net electricity exporter after 2030 based on the expansion of its renewable capacities, albeit the prices of electricity and CO2 would be slightly higher, because of the nuclear delay. Additionally, the refurbishment of Cernavodă’s Unit 1, scheduled for 2027–2029, which will take 700 MW out of the system, will not pose supply security risks, even in a lowergas scenario. This is because significant new renewable energy sources (RES) will begin operating, with solar energy nearly doubling from 4.3 GW to 8.2 GW and onshore wind increasing by more than 50% from 5 GW to 7.9 GW between 2025 and 2030. Natural gas capacities will increase by 500 MW, and battery storage will see an approximately fourfold growth in the same timeframe. Mihnea Cătuți, EPG Head of Research Mihnea is the Head of Research at EPG, coordinating the research strategy and activities within the organisation. His expertise includes EU climate and energy policy and the transition in South-East Europe.He is also an Associate in E3G’s Clean Economy Programme, contributing to the work on industrial decarbonisation. In the past, Mihnea was an associate researcher at the Centre for European Policy Studies (CEPS), where he led the work on the future of hydrogen in the EU. He was also an associate lecturer in Public Policy at the University of York. Mihnea has a Bachelor of Science degree from the University of Bristol and...

The public discourse is still flooded with faulty narratives on the future of hydrogen, especially on the doubtful expectation that hydrogen can either replace the use of natural gas in most current uses and it can therefore provide a lifeline for the continued use of fossil fuels throughout the following decades. To counter such narratives, this paper dispels a set of nine myths that are still pervasive in national discussions on hydrogen.

În 2024 România ar trebui să își regândească modelul de dezvoltare economică printr-o reorientare către tehnologiile viitorului și tranziția către o economie cu emisii reduse de gaze cu efect de seră. Pentru aceasta este necesară renunțarea la apatia clasei politice și la căutarea soluțiilor în trecut și reorientarea priorităților naționale către o economie bazată pe utilizarea surselor de energie curată, dezvoltarea infrastructurii energetice, atragerea lanțurilor valorice pentru tehnologiile verzi și susținerea capacității de cercetare și inovare pentru crearea de locuri de muncă bine plătite, care să poată răspunde provocărilor următoarelor decenii. Mihnea Cătuți, EPG Head of Research Mihnea is the Head of Research at EPG, coordinating the research strategy and activities within the organisation. His expertise includes EU climate and energy policy and the transition in South-East Europe.He is also an Associate in E3G’s Clean Economy Programme, contributing to the work on industrial decarbonisation. In the past, Mihnea was an associate researcher at the Centre for European Policy Studies (CEPS), where he led the work on the future of hydrogen in the EU. He was also an associate lecturer in Public Policy at the University of York. Mihnea has a Bachelor of Science degree from the University of Bristol and a Masters in European Public Policy from the University of York and the Central European University. He is currently finalising his PhD at the University of York focusing on energy and climate governance in the EU. Contact: mihnea.catuti@epg-thinktank.org

Spre deosebire de emisiile operaționale de carbon, care țin de consumul de energie în clădire și care fac obiectul măsurilor de creștere a eficienței energetice, emisiile încorporate ale clădirii sunt cele care țin de materialele de construcții și de activitățile de construcție, precum și de tratamentul la finalul duratei de utilizare. De aceea, contribuția sectorului clădirilor – care, în UE, reprezintă mai bine de 40% din consumul total final de energie – la realizarea unei traiectorii de neutralitate climatică până în 2050 nu poate fi realizată fără controlul și reducerea emisiilor încorporate de carbon.

Proiectul, care a stârnit imediat consternare în piața de energie, reprezintă o tentativă de oficializare a unei practici decizionale la vârful politicii prin care fondurile europene pentru energie sunt controlate în mod netransparent și direcționate necompetitiv către unele mari companii de stat, cu încălcarea flagrantă a legislației naționale și europene privind concurența și ajutorul de stat, dar și a prevederilor de transparență și nediscriminare din ghidurile mecanismelor financiare europene.

Rămân o serie de politici adoptate la nivel național fie înainte, fie după asumarea pachetului “Fit for 55” la nivelul UE, care ar trebui reanalizate în vederea alinierii la obiectivele mai recente și mai ambițioase din punct de vedere climatic.

As part of the ConsenCUS project, EPG is analyzing the narratives and perceptions surrounding carbon capture, utilization and storage (CCUS) in Romania, where a novel carbon capture and conversion technology will be demonstrated in the near future.

Offshore wind power plays a key role in Europe’s pathways to reducing dependency on fossil fuel imports and decarbonisation by 2050, in a moment when EU’s energy security interests and climate objectives are fully aligned.

The main resource of Gorj County is represented by its inhabitants, hence any transformation plan should be centred on them, as they are both the driving force and the beneficiaries of any economic and social progress of their county. The transition towards a carbon-neutral economy, probably the main concern worldwide in the next few decades, requires a significant number of new jobs. That is why Gorj County can rebuild its local identity around the sustainable energy transition, contributing to the significant efforts required for investing in renewable energy, energy efficiency or clean transport, thus continuing to play a central role in the Romanian economy. Gorj County can thus shift from the county with the highest carbon dioxide emissions in Romania to a leading region in this sustainable transition. This is a favourable moment for starting this transformational process for the county’s economy. Post-pandemic recovery, the funding made available across Europe especially for this purpose, but also the significant amounts that Romania has available for the energy transition, along with the commitment of central and local authorities to ensuring a just transition, create the first and, at the same time, a rare window of opportunity for reconfiguring the county’s economy. In supporting this approach, this study proposes a transition path which can ensure sustainable and diversified economic growth, attracting well-paid jobs and increasing the quality of life. For the transition of Gorj towards a sustainable county, this study proposes a series of short-, medium- and long-term objectives. The main immediate priority of the county authorities should therefore be to capitalise on the potential of renewable resources and renovate existing buildings. Renewable energy is the main decarbonisation vector of the European economy. The solar potential in Gorj County is above the national average and, consequently, must represent a priority in this endeavour. At the same time, the renovation of buildings to increase energy efficiency is another opportunity offered by the sustainable transition, with positive effects on the county’s economy, as well as on individual households, by reducing energy costs and improving living conditions. As long-term objectives, Gorj County must attract as large a share as possible of the value chains for advanced energy technologies with a contribution to the decarbonisation process. It is worth mentioning that for the counties where coal mining and its use in the energy sector were the main object of activity, staying relevant in the operation of the national energy system is justified. By developing the proposed value chains, their role will remain relevant.  Following an analysis of the economic situation in the county and of its educational profile, the study identifies four value chains: 1. renewable energy and electricity grids; 2. energy efficiency in buildings and heat pumps; 3. batteries, components and infrastructure for electric vehicles; 4. “green” hydrogen-based technologies. The county’s competitive advantages are also presented as well as a few measures that could enhance them

The present study assesses the natural and technical potential of Romania’s offshore wind sector, finding an estimated total potential natural capacity of 94 GW, out of which 22 GW could be installed as fixed turbines, leading to a total Annual Energy Production (AEP) of 239 TWh, with 54,4 TWh from fixed turbines. The data analysed in this report show that wind speeds increase with the distance to the shore, with only the central part of the deep-water sector having more sizeable mean wind speeds (close to 7 m/s). A large part of Romania’s Exclusive Economic Zone (EEZ) consists of a deep-water area (>50 m) that is more suitable for floating platforms. Nonetheless, several offshore wind farms in Europe have been recently built at about 60 km from shore, a distance that is just within the Romanian transition area from shallow to deep water. The study identifies two potential clusters with most favourable conditions for a first stage of offshore wind development, based on fixed turbines: one with capacity factors between 33-35%, in water depths below 50 m at 40-60 km from the shore – an area that strikes the right balance between wind resources and costs of the required offshore network, given the possibility to inject the output in the Constanța Sud electrical substation and the proximity to the Port of Constanța.

This analysis focuses on the tax applied to the water used by hydroelectric power plants in Romania. This study also includes information on similar water taxes around Europe and a comparison between them and that applied in Romania. Although set in Romania in 2000 as a small tax meant to raise funds for development of hydro projects, this fee has increased significantly over the years, making it even harder for the hydroelectric producers’ activity. In the category of invented-out-of-nothing taxes one can find the fee imposed by NARW – the National Agency "Romanian Waters” (ANAR, in Romanian) for water used by power plants producing electricity from hydro sources (micro or large scale). True, this is not a fee that exists only in Romania, but it is nonetheless a bizarre cost that hydroelectric producers must pay. Actually, more than 40% of the energy produced from hydro sources in the 27 countries analyzed, at European level, incurs different types of water taxation. Out of these countries, 11 (9 of which are EU member states) pay different types of fees for hydro power generation, with Romania paying the most for water expenses, according to Hidroelectrica‟s (the main hydro electricity producer in Romania) special administrator.