Romania and Bulgaria are preparing a grid project designed for the electricity market they are rapidly creating rather than the one they inherited. CARMEN—Romanian and Bulgarian Smart Grid Assets Increasing RES and Interconnection within South-East Europe—has a total budget of almost €208 million, with approximately half expected from European grants.
The project brings together Bulgaria’s Electricity System Operator, Romanian transmission operator Transelectrica and Romanian distributor Delgaz Grid. Bulgaria’s component exceeds €59 million and received about €29 million from the Connecting Europe Facility. Works are scheduled through 2032.
CARMEN is not a single new interconnector. It is a coordinated package of substation reconstruction, automation, telecommunications and control systems intended to increase the useful capacity and observability of the existing network. In Bulgaria, work covers substations including Dobrudzha, Varna, Gorna Oryahovitsa, Mizia and Balkan. More than 1,100 kilometres of optical telecommunications infrastructure is planned on overhead lines, including the 400 kV Druzhba and Saedinenie interconnectors with Romania.
This distinction matters because SEE’s grid problem cannot be solved only by building more lines. Renewable generation is geographically dispersed and changes quickly. Operators need real-time data, automated control and coordinated remedial actions to use infrastructure safely. Digital systems can sometimes release capacity faster and more cheaply than conventional network expansion.
The project’s location is strategic. Northeastern Bulgaria and southeastern Romania have strong wind and solar potential, while the broader north-south corridor links renewable-rich areas to demand centres and neighbouring markets. More controllable capacity can reduce curtailment, improve cross-border exchanges and support future green-hydrogen production.
CARMEN also demonstrates how distribution and transmission grids are converging operationally. Rooftop solar, batteries, electric vehicles and flexible industrial loads connect primarily to distribution networks, but their combined behaviour affects national balancing and cross-border flows. Delgaz Grid’s participation recognises that a smart transmission system cannot function with a blind distribution layer.
Financing reflects this broader role. In July 2026, EBRD separately provided Delgaz Grid with a RON 300 million loan—about €57 million—to support its 2026–2030 electricity-network capital programme, including modernisation, digitalisation and smart meters. The loan is not part of the €208 million CARMEN budget, but the two investments reinforce the same transition.
Implementation risk remains. Digital projects require interoperable systems, cybersecurity, trained staff and procurement discipline. A new sensor creates little value if data cannot be shared across operators or used in capacity calculations. Cross-border projects are especially vulnerable to asynchronous delivery, where one country finishes its component before the other.
If executed well, CARMEN will show that grid value is not measured only in kilometres of cable. Better information and control can allow the same physical network to carry more renewable electricity, manage contingencies and support trade. For SEE, where permitting a new line can take a decade, that is potentially as important as constructing new infrastructure.
