Romania is emerging as one of Southeast Europe’s clearest examples of how long-term revenue stabilisation can accelerate wind investment without eliminating the need for rigorous project due diligence.
Its Contracts for Difference (CfD) programme has rapidly gained scale, creating a framework designed to improve revenue visibility and attract investment into renewable energy.
Romania’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, bringing the combined total for the first two rounds to approximately 4.2 GW. This exceeded the country’s initial 3.5 GW target under its Recovery and Resilience Plan.
The mechanism is based on a two-way CfD, which provides long-term revenue protection around an agreed strike price while keeping the project integrated into the electricity market.
That distinction is important.
A CfD substantially reduces price uncertainty.
It does not eliminate uncertainty over wind production.
Romania’s official CfD register illustrates the range of prices awarded to wind projects.
First-round onshore wind strike prices ranged from €54.4898/MWh to €77.325/MWh among the contracts listed in the initial register.
Across all CfD contracts signed during 2025, OPCOM reported 2,630.48 MW of onshore wind capacity under 41 contracts, with strike prices ranging from €54.4898/MWh to €79.50/MWh.
For lenders, this type of price protection can significantly strengthen a project’s financing structure.
Revenue volatility is reduced, while exposure to prolonged periods of weak wholesale electricity prices becomes less significant.
As a result, projects may be able to support longer debt tenors or higher leverage than comparable fully merchant assets, provided that their remaining risks are adequately managed.
The Vifor wind farm illustrates the financing implications.
The EBRD participated in additional financing facilities worth €331 million for a 269 MW second phase of the project, bringing total planned capacity to approximately 461 MW.
A 240 MW portion of the expansion secured a CfD under Romania’s first auction.
This is precisely what an effective support mechanism is intended to achieve.
It reduces one of the largest uncertainties facing a capital-intensive renewable project, allowing banks to focus more closely on risks that can be managed through project design, operational planning and contractual allocation.
But those risks do not disappear.
The wind resource can underperform.
Turbine availability can deteriorate.
Wake losses can exceed initial assumptions.
Construction can be delayed.
Grid outages can reduce delivered electricity volumes.
Forecasting and balancing costs remain.
The CfD protects the price mechanism.
It does not guarantee how many eligible MWh the plant will produce.
That distinction is essential to understanding the bankability of supported wind projects and should prevent investors from treating them as equivalent to quasi-sovereign bonds.
The financing case still depends heavily on the technical assumptions underpinning the contracted revenue.
A P90 production scenario remains relevant even when electricity prices are substantially stabilised.
Availability guarantees, operations and maintenance arrangements, grid connection conditions and curtailment assessments remain equally important.
Negative-price treatment and settlement rules can also influence project economics.
European policy has increasingly focused on ensuring that CfDs provide investment certainty without encouraging generators to continue producing electricity when the system does not need it.
The European Commission notes that well-designed two-way CfDs can reduce financing costs while supporting efficient electricity-system operation and limiting unnecessary renewable curtailment.
This becomes increasingly important as renewable penetration rises.
A poorly structured support mechanism could shield generators from market signals to such an extent that they have little incentive to respond to periods of surplus electricity.
A better design reduces long-term revenue risk while preserving market signals and operational discipline.
Romania’s experience therefore has implications beyond its domestic market.
Southeast European countries face a common challenge: renewable projects require substantial private capital, while merchant electricity markets can remain too volatile to support efficient long-term financing.
CfDs can help bridge that gap.
But they should be understood as a risk-allocation mechanism, rather than a substitute for comprehensive bankability analysis.
The project still needs a credible wind-resource assessment.
The turbines still need to perform.
The grid still needs to accommodate the electricity.
Forecasts still need to be sufficiently accurate to manage market exposure.
Operations and maintenance arrangements must continue to protect availability throughout the asset’s operating life.
Romania’s model demonstrates how public policy can reduce one of the principal risks that private developers have limited ability to control: long-term wholesale electricity price uncertainty.
The remaining risks still belong to the project.
That is precisely why the model can work.
