Romania has become Southeast Europe’s strongest example of how long-term revenue stabilisation can accelerate wind investment without removing the need for rigorous project due diligence. Its Contracts for Difference (CfD) programme has quickly reached significant scale. The model reduces long-term price uncertainty, but does not guarantee wind output.
Romania’s CfD auctions and contract prices
The country’s first CfD auction awarded 1.5 GW of renewable capacity, including 1 GW of onshore wind. A second auction, completed in August 2025, awarded another 2,751 MW of wind and solar capacity. Together, the first two rounds reached 4.2 GW, exceeding the initial 3.5 GW target under the Recovery and Resilience Plan. (EBRD auction data)
Romania’s mechanism uses a two-way CfD, providing a project with long-term revenue protection around an agreed strike price while keeping it integrated into the electricity market. Prices in the initial register for first-round onshore wind contracts range from €54.4898/MWh to €77.325/MWh. The register covers the contracts shown in that initial round.
For all CfD contracts signed during 2025, OPCOM reported 2,630.48 MW of onshore wind across 41 contracts. Their strike prices ranged from €54.4898/MWh to €79.50/MWh.
Revenue protection and project financing
Price protection can strengthen a project’s debt capacity by reducing revenue volatility and the risk posed by an extended period of weak merchant electricity prices. If the remaining risks are acceptable, a project’s capital structure may support longer tenors or higher leverage than that of an equivalent fully merchant project. The Vifor wind farm illustrates the potential financing effect.
The EBRD participated in additional financing facilities worth €331 million for the wind farm’s 269 MW second phase, bringing total planned capacity to around 461 MW. A 240 MW portion of the extension secured a CfD in Romania’s first auction. (EBRD project details)
A well-designed support mechanism reduces one of the major uncertainties in a capital-intensive project. This allows banks to focus more on risks that can be managed through project design and contractual allocation. However, the CfD reduces price uncertainty; it does not guarantee the number of eligible MWh the plant will produce.
Operational and technical risks remain
Wind output can fall short of expectations, turbine availability can deteriorate and wake losses can exceed assumptions. Projects also remain exposed to construction delays and grid outages that reduce delivered volumes. Forecasting and balancing costs do not disappear under a CfD.
Investors should not treat supported projects as quasi-sovereign bonds. Financing still depends heavily on the technical assumptions underpinning contracted revenue, and a P90 production case remains relevant even when electricity prices are substantially stabilised. Availability guarantees, the O&M structure, grid connection and curtailment analysis also remain important.
Negative-price treatment and settlement rules can affect project economics as well. European policy has increasingly focused on providing investment certainty through CfDs without encouraging generators to keep producing when the electricity system does not need their output.
CfD design and the wider Southeast European market
The European Commission says well-designed two-way CfDs can reduce financing costs while preserving efficient system operation and limiting unnecessary renewable curtailment. (European Commission information) This issue becomes more important as renewable penetration increases. A poorly structured support mechanism could shield generators so completely from market signals that they have little incentive to respond to surplus conditions, while a better design reduces long-term revenue risk and retains operational discipline.
Romania’s experience is relevant beyond its own market. Southeast European countries share the challenge of financing renewable projects with large volumes of private capital while merchant power markets can remain too volatile to support efficient long-term debt. CfDs can bridge that gap, but they are a risk-allocation mechanism, not a substitute for bankability analysis.
Projects still need credible resource assessments, and turbines must perform as expected. The grid must be able to accept the electricity, forecasts must be accurate enough to manage market exposure, and O&M must protect availability over two decades.
Romania’s model shows how public policy can reduce the long-term wholesale electricity price risk that private developers have limited ability to control. The remaining risks still belong to the project.