Supported by the EBRD, Romania has this week launched a Contract for Difference (CfD) mechanism for the construction of renewable energy installations and opened the first auction for 1.5 GW of renewable energy generation capacities – 500 MW of solar PV and 1 GW of onshore wind. This is the next step in the country’s ambitious plans to scale up the share of renewables in its energy mix.
EBRD support for the design and implementation of the scheme is funded by Spain and the European Union Technical Support Instrument, managed by DG REFORM.
“Romania’s ambition to develop its renewable energy sector is fully aligned with the EBRD’s strategy in the country. We are looking forward to support further the Ministry of Energy and contribute to scaling-up private sector investments in the sector,” said EBRD Head of Romania Victoria Zinchuk.
The two-way CfD scheme incentivises investments in renewable energy by providing revenue stability to developers and strengthening the market integration of renewables.
The financing of the CfD mechanism is ensured by funds secured from the European Union Modernisation Fund. This covers a first wave of projects for a total of 5 GW, split into this year’s 1.5 GW auction and a second one for 3.5 GW in 2025.
The CfD mechanism brings Romania closer to its ambitious long-term decarbonisation targets. Investment in renewable energy is critical for reaching the climate commitments outlined in the country’s National Energy and Climate Plan, under which a target of 34 per cent of renewable energy in gross final energy consumption by 2030 is set up. Romania’s new draft energy strategy aims for 44 per cent of gross final energy consumption from low-carbon sources by 2035.
The EBRD, a leader in climate finance, has supported the implementation of renewable energy auctions across its countries of operations.
The EBRD’s strategic priority on the energy sector is to helps its countries scale up renewable energy through financing instruments and technical assistance to develop supportive policy frameworks that, together with well-designed competitive auctions, are conducive to private sector investment.
In Romania, the Bank is fully supporting the country’s move towards cleaner energy. Since the beginning of this year, the EBRD has financed nearly 1GW of renewable capacity across six projects. These investments, amounting to over €180 million from EBRD funds, have further mobilised almost €1 billion of private and public finance.
Overall, the EBRD has invested more than €11.3 billion in 549 projects in Romania to date.