Bucharest borrows EUR 34 mln from EIB to upgrade district heating system

The Bucharest City Hall has secured a EUR 34.4 mln loan from the European Investment Bank (EIB) to support the rehabilitation of the city's district heating system.

This funding marks the first tranche of a broader EUR 300 million loan package intended to finance key infrastructure projects, including district heating, urban mobility, and the modernization of surface public transport.

The loan will be used to co-finance the ongoing rehabilitation of Bucharest's district heating network, a project that also benefits from non-reimbursable funding from the European Commission under the Sustainable Development Programme. The initiative, currently in its second phase, aims to improve energy efficiency and reduce heat losses in a system that has long struggled with aging infrastructure and frequent breakdowns.

In October 2024, Bucharest's municipal council approved a resolution to contract the EUR 300 million loan from the EIB. The funds are expected to play a crucial role in modernizing essential public services, including the expansion and renewal of the capital's transport network alongside the overhaul of the district heating system.

The district heating network in Bucharest is among the largest in Europe but has suffered from chronic underinvestment, leading to frequent pipe bursts and heating outages, particularly during the winter months.

The rehabilitation project seeks to replace outdated pipelines and improve the efficiency of heat distribution to residents.

(Photo source: Inquam Photos / George Călin)