The European Bank for Reconstruction and Development (EBRD) increased its investments in Romania in 2024, committing €707mn across 44 projects, and plans to boost investment further in the coming years. The increase from 2023, when the bank invested €658mn in 23 projects, was largely down to a hike in investment into projects supporting Romania’s green transition.

The increase in investment in Romania is in line with the EBRD’s broader expansion in 2024, with total investments across its regions rising to €16.6bn, a 26% increase from the previous year’s €13.1bn.

In 2024, the EBRD financed nearly 1 GW of renewable energy capacity, committing over €180mn of its own funds and mobilising nearly €1bn in public and private finance.

“It has been a very good year for us in Romania, which comes on the back of a number of years when we increased our business volume year by year,” Mihaela Mihăilescu, the EBRD’s deputy head for Romania, told bne IntelliNews. 

“What stands out this year [2024] compared to previous years is the strong uptake in renewable energy investments. We have been working on this for many years, but have not had the legal environment in place to be able to advance more quickly.” 

Energy investments included €46mn allocated to the Urleasca Wind Farm, an equity investment in the regional energy provider Premier Energy, €15mn for Photon Energy, a regional producer of renewable energy, and €32mn for the Vifor onshore wind project. A further €100mn equivalent was directed towards upgrading the electricity distribution network. Construction bridge financing of €12.2mn was granted to Danube Solar Five to support the development of solar power plants in Dolj County. 

As well as investing into the sector, “We have been working with Romania’s ministry of energy on improving legislation so these investments would be able to take place and be aligned with Romania’s commitments on Green as an EU member state,” said Mihăilescu. 

Romania’s efforts to implement EU green programmes, such as Fit for 55 and REPowerEU, have unlocked significant additional investments, according to the development bank. The country’s target is for 38% of final energy consumption to come from renewable sources by 2030.

Green energy-related investments in 2024 included €46mn for the Urleasca Wind Farm, €32mn for the Vifor onshore wind project, and €15mn for regional renewable producer Photon Energy. The bank also provided €12.2mn in bridge finance for Danube Solar Five’s solar plants in Dolj County and contributed to a €110mn financing package for solar projects at Iepurești and Ghimpati.

Romania’s path to green energy transition has been somewhat bumpy, with an initial strong start followed by legislative changes that temporarily disincentivised investors. However, that has now changed. 

“I think now there is a new wave of investments coming on back of Romania’s commitment as an EU member state to reach net zero by 2050,” said Mihăilescu. 

Mihăilescu pointed to multiple streams co-financing green energy investment, such as EU modernisation funds, Repower EU, the Recovery and Resilience Facility (RRF) and structural funds. 

To address energy price volatility, the EBRD supported Romania’s first Contracts for Difference (CfD) renewables auction, which successfully awarded up to 1.5 GW of capacity in 2024. A memorandum of understanding signed with Romania’s Ministry of Energy in December 2024 aims to design additional storage support schemes and implement reforms to integrate storage capacities into energy markets.

“We have done a lot of work on the policy side on the CfD scheme, working with the energy ministry and other Romanian stakeholders on designing it to attract private sector interest,” said Mihăilescu. The work has been ongoing since 2021. 

“It has been already validated by the market. The tender successfully took place in December. There was a lot of competition from the private players. I was very happy to see that, as it proved the scheme was well received by the market. The second tender is due to take place this year.”

Another important aspect pointed out by Mihăilescu is to help the banking sector engage more in financing for investment in Romanian renewables; the EBRD has already seen an increase in the number of banks interested in syndications or financing deal by themselves. 

Overall, 74% of the EBRD’s investments in Romania in 2024 were directed toward green economy projects, significantly above the 58% average across all regions where the bank operates. These projects are expected to cut carbon dioxide emissions by 750,000 tonnes per year (tpy).

Beyond the energy sector, the EBRD invested into a broad range of areas. 83% of the bank’s investments in the country targeted the private sector, surpassing the 76% average across all EBRD regions

 Private sector transactions included a €40mn risk-sharing agreement with Banca Transilvania for Omnia Europe SA and the launch of a supply chain financing programme with an initial €10mn to support local suppliers for Profi Rom Food SRL. Additionally, the bank made equity investments in discounter La Cocos and AROBS Transilvania Software SA, alongside several other debt and equity transactions.

Looking ahead, the EBRD plans to further increase its investment into Romania. A spokesperson for the bank said it aims to boost investment to €1bn a year, containing the growing trend over the last few years. 

Top markets for the EBRD in terms of the volume of investment include Turkey and Ukraine, where the development bank invested record highs of €2.6bn and €2.4bn respectively in 2024. 

2025 began at a time of political uncertainty in Romania, after the cancellation of the autumn 2024 presidential election amid concerns over Russian interference following the unexpected first round lead taken by far-right candidate Calin Georgescu. The election has now been rescheduled for May 2024. 

Despite the political drama, Mihăilescu does not expect it to affect the EBRD’s activities in the country. 

“On the investment front so far we don’t see any change. All the investments we working on last year still have the same plan, the same timelines in place,” said Mihăilescu.

“We are here for Romania whenever and for whatever is needed, so long as it is aligned with our mandate,” she said.  

“I think 2025 is going to be the same if not better [than 2024] … we are already in advanced discussions on a couple of transactions,” she told bne IntelliNews. “We hope our investments will be as diverse as they were last year.”