Romania approves subsidy mechanism for wind, solar projects
Romania’s Ministry of Energy has approved a subsidy mechanism for contracts for difference (CfD) for wind and solar power projects. This mechanism will support 5 GW of renewable energy capacity across two tender rounds this year and next.
A CfD ensures stable income for green energy investments by guaranteeing a fixed price per megawatt-hour. If market prices fall below this rate, the state pays the difference. Conversely, if market prices exceed the fixed rate, the surplus is returned to the state.
The subsidies, part of Romania’s National Recovery and Resilience Plan (NRRP), are aimed at projects with at least 5 MW capacity and will last for 15 years. The first tender, set for the end of the year, will allocate 1 GW to onshore wind and 500 MW to solar projects. The second round, scheduled for late next year, will allocate 1.5 GW to onshore wind and 2 GW to solar.
The initial auction’s maximum prices are set at EUR 91 per MWh for solar and EUR 93 per MWh for wind, with winners determined by the lowest bids. The subsidies will be funded by the EU’s Modernisation Fund, which provided EUR 3 billion.
The European Commission has approved this scheme but excluded regulatory and transmission costs, adding approximately four euro cents per MWh to consumer power bills. Additionally, Romania is planning a significant subsidy mechanism for energy storage projects.