Renewables

Romania’s Ministry of Energy is putting EUR 17.6 billion of EU funds to work

Romania Ministry Energy putting EUR 17 6 billion EU Modernisation Fund to work Burduja

Photo: Sebastian Burduja / Facebook

Published

January 22, 2024

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Published:

January 22, 2024

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Scheduled to be launched on March 1, two public calls in Romania will enable companies to get a total of EUR 815 million in grants for renewable electricity projects. Minister of Energy Sebastian Burduja said that the subsidies would cover 2 GW. The package is from EU funds of EUR 17.6 billion in total. Contracts were already signed for EUR 1.6 billion from the National Recovery and Resilience Plan.

The Ministry of Energy of Romania has EUR 16 billion in grants at its disposal from the European Union’s Modernisation Fund and proposals for public calls for an overall EUR 815 million are currently under public consultation. Officials estimated that investors would be able to submit their renewable electricity projects from March 1.

Contracts were recently signed for subsidies of an overall EUR 1.6 billion from the National Recovery and Resilience Plan for 1.7 GW, Minister of Energy Sebastian Burduja noted. A large part should be completed by the end of the year, he pointed out.

In addition, contracts for grant programs worth more than EUR 6 billion in total from the Modernisation Fund were signed so far, the minister said. They were for the modernization of the electricity distribution system and support for prosumers.

Beneficiaries have signed contracts for EUR 6 billion from the EU’s Modernisation Fund

Applications from public authorities for solar and wind power projects for self-consumption are under evaluation. Furthermore, calls for heating systems will be launched by mid-year, Burduja added.

Next up would be the programs for energy storage and biomass and the auctions for market premiums for photovoltaics and wind farms under contracts for difference (CfDs), he revealed. The CfDs will secure a fixed price for 15 years under a EUR 3 billion support mechanism, also from the Modernisation Fund, Burduja explained.

They are expected to cover 5 GW through two rounds, in 2024 and 2025, he said. Burduja said he vowed to accelerate all investment programs and transform Romania into a regional energy hub.

Prosumers category tripled to over 1.5 GW in one year

Electricity capacity increased nine times more last year, 624 MW, than in 2022, while the prosumers category expanded by more than 1 GW, the minister stressed. Solar accounted for 496 MW in newly installed power plants. Wind turbines with 72 MW in total were commissioned as well as 56 MW from fossil fuels. Romania added just 25 MW in photovoltaics and 44 MW from hydrocarbons in the previous year.

As for prosumers, there were 40,171 at the end of 2022, with 417 MW in total capacity. One year later the number of households, institutions and firms with the status was higher than 100,000 while the category probably topped 1.5 GW so far. If Romania added almost 1.1 GW from prosumers and 496 MW from utility-scale units, it means it more than doubled its solar power capacity within a year!

“The prosumers phenomenon is in line with what we want for the future of the Romanian energy sector: decentralization, decarbonization, digitalization. Prosumers are effectively building this future in 3D, and my commitment as energy minister is to support prosumers. They strengthen the resilience of electricity supply at the level of households in Romania, support the green transition process and achieve a high degree of digitization, which allows better management at the level of each point of consumption,” Burduja stated.

SMR project is for six modules of 77 MW apiece

He highlighted several ongoing projects. There is a real chance that two more units of 430 MW in total would be put into operation at the Iernut gas power plant by December, the minister claimed. The proposed gas-fired power plant in Mintia is valued at more than EUR 1 billion and it is set to bring 1.7 GW in capacity, which would make it the largest in Europe, he asserted. Gas plants in Ișalnița and Turceni will have an overall 1.35 GW, Burduja said.

The Mintia project is for 1.7 GW in capacity, which would make it the largest gas-fired power plant in Europe

Aside from the planned construction of reactors 3 and 4 in the Cernavodă nuclear power plant, with a combined 1.4 GW, reactor 1 is planned for an upgrade. The small modular reactor (SMR) project will consist of six modules of 77 MW each, he said.

The Tarnița-Lăpuștești pumped storage hydropower plant is envisaged with up to 1 GW, Burduja added. He also touched upon the project for a high-voltage line from the Black Sea to the western border. The minister estimated that the Neptun Deep offshore gas field would double the country’s production in the sector when it comes online in 2027.

First call set for March is for subsidies from Modernisation Fund to cover at least 70% of electricity consumption

The two tenders scheduled for March are expected to fund 2 GW in total, Burduja said. State aid is limited to EUR 20 million per beneficiary. The projects must be completed within three years after the contract is signed, but no later than the end of 2029.

Eligible to participate are micro, small, medium-sized enterprises and large companies licensed to generate and sell electricity. The government managed to transfer much of the funds from the National Recovery and Resilience Plan (NRRP or, in Romanian, PNRR) to extend deadlines.

The scheme for self-consumption is for projects that would cover at least 70% of electricity use. The budget amounts to EUR 415 million.

Romania allocated EUR 30 million for wind power, up to EUR 700,000 per MW. There is EUR 25 million for hydropower, with a maximum of EUR 1.81 million per MW. Investors in photovoltaic projects of up to 1 MW can get as much as EUR 170 million in state aid or EUR 1 million per MW, compared to EUR 190 million or EUR 500,000, respectively, for larger solar parks.

The remaining EUR 400 million from the Modernisation Fund is for utility-scale renewable electricity plants, of which EUR 100 million each for wind and hydropower and EUR 200 million for solar power. The maximum amounts per megawatt, in that order, are EUR 700,000, EUR 1.81 million and EUR 500,000.

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