Green energy investors defend Govt.’s CfD support scheme in Romania

The associations of investors in solar parks and wind farms, the Romanian Photovoltaic Industry Association (RPIA) and the Romanian Wind Energy Association (RWEA), defended in a public statement the contract for difference (CfD) scheme designed by the government as a tool to encourage green energy investments and secure the meeting of the decarbonization targets.

The two associations argue that the CfD is the only support mechanism that, designed and implemented per European regulations, protects both end consumers and investors from market volatility, Economedia.ro reported.

RPIA and RWEA state that Romania has to meet a target of renewable energy sources (SRE) of 42.5%, meaning an increase in the share of SRE to over 40% (11.1 GW photovoltaic and 11.4 GW wind).

The government of Romania endorsed a CfD scheme with a budget of EUR 3 billion aimed at stimulating the development of wind and solar electricity generation installations with a combined capacity of 5 GW.

Independent experts, however, argued against the CfD mechanism for the high prices they may generate, lack of flexibility (compared to market-based mechanisms) and adverse incentives that would amplify instead of addressing the market imbalances. They pointed to the generous subsidization mechanism extended by Romania under Law 220/2008, which proved unsustainable because of the high prices generated.

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