Romania is emerging as one of Southeast Europe’s most promising energy storage markets as rapid renewable energy growth begins to expose a shortage of long-duration flexibility resources. While lithium-ion battery projects are expanding across the country, developers and investors are increasingly exploring technologies capable of storing energy for extended periods. The partnership between Hagag Europe and Airengy to develop a compressed-air energy storage facility in Romanian salt caverns highlights a different approach to grid flexibility—one designed to store electricity for days rather than just a few hours.
The proposed project will utilise Romania’s natural underground salt caverns as storage reservoirs for compressed air. During periods of excess electricity generation, air will be compressed and injected into the caverns, which offer large storage volumes, natural airtight conditions and relatively low operating costs. When electricity demand rises, the stored air can be released and used to drive turbines through a hydraulic system, generating power for the grid. The technology belongs to the category of Long Duration Energy Storage (LDES), a segment expected to become increasingly important as renewable energy penetration continues to grow.
The investment requirements are substantial but remain within the range of large-scale infrastructure projects. Total project costs are estimated at approximately €55 million. The first development phase is expected to deliver around 200 MWh of storage capacity with an investment of roughly €4.5 million, while operations could begin within 12 to 18 months after construction starts. The second phase would significantly expand the project, targeting approximately 25 MW of discharge capacity and around 5 GWh (5,000 MWh) of total storage capacity, supported by an additional investment of about €50 million.
The structure of the partnership is equally noteworthy. Hagag Europe will contribute access rights to the underground salt caverns, while Airengy will be responsible for designing, constructing and operating the storage facility. This model separates ownership of the geological resource from technology deployment and operational management, creating a framework that could potentially be replicated in other countries with suitable underground storage formations.
Romania’s interest in long-duration storage reflects a growing challenge within its power sector. The country is experiencing strong growth in photovoltaic capacity and increasing renewable energy investment, but storage infrastructure has not expanded at the same pace. Conventional battery systems are effective for short-term balancing and frequency support, yet they are less suited to managing multi-day fluctuations in renewable generation. Compressed-air storage offers an alternative solution, combining long operational life, reduced dependence on critical minerals and the ability to store large quantities of energy over extended periods.
From an investment perspective, the project still carries technology, regulatory and execution risks. Commercial viability will depend on electricity market spreads, balancing market opportunities, potential capacity remuneration mechanisms and financing conditions. Nevertheless, Romania’s decision to support the development of alternative storage technologies reflects an important strategic objective. A future electricity system built around solar, wind, natural gas and cross-border interconnections will require multiple layers of flexibility. Batteries provide speed, pumped hydro delivers scale, and compressed-air storage could provide the long-duration capability needed to bridge extended periods of renewable variability.
