Romania’s second contracts-for-difference (CfD) auction has reinforced solar power’s position as the main driver of new renewable capacity in Southeast Europe. The latest round awarded 1,488 MW across 26 photovoltaic projects, marking another step in the Romanian market’s shift from fragmented merchant development toward large-scale projects supported by more predictable long-term revenues.
The most prominent project is Dama Solar, the planned development by Rezolv Energy in western Romania. With approximately 1.04 GW of planned capacity, the project is among the largest solar developments currently being pursued in the region. Auction results indicate that 211 MW secured CfD support at a strike price of €65.17/MWh, providing investors and lenders with a clearer benchmark for the revenue level required to finance large-scale solar projects in Romania.
Romania’s CfD mechanism is designed to provide protection against periods of low wholesale electricity prices while requiring projects to return excess revenues when market prices rise above the contracted level. This structure reduces exposure to wholesale market volatility and can improve financing conditions. The second auction’s €73/MWh ceiling for solar projects also imposed greater price discipline and encouraged competition among developers.
The results highlight the different development dynamics of solar and wind. More than 2.75 GW of combined renewable capacity was awarded, but the available wind quota was not fully utilised. Solar projects generally benefit from shorter construction periods, established supply chains and fewer siting constraints, giving photovoltaic development a clear advantage in a market seeking rapid additions of new generation capacity.
However, Romania’s solar boom is also exposing a growing challenge for the wider regional electricity market. Across Southeast Europe, increasing photovoltaic output is pushing daytime electricity prices toward zero, while prices can rise sharply after sunset when solar generation disappears. On 19 July 2026, Romanian day-ahead prices reportedly dropped to just €0.02/MWh during the solar generation period before climbing to €154.13/MWh later in the day. Bulgaria and Greece experienced similar price movements, highlighting the growing disconnect between abundant midday generation and evening demand.
For solar developers, this dynamic can reduce the capture price, or the average market value received for electricity during the hours when a plant actually generates. While CfDs can provide revenue protection for supported projects, merchant plants and projects whose contracts eventually expire will remain increasingly exposed to price cannibalisation. Curtailment risks could also increase if transmission capacity, flexible demand and storage do not expand at a similar pace.
The next phase of Romania’s solar expansion will therefore depend less on the number of megawatts installed and more on how effectively new generation is integrated into the power system. Batteries can shift excess solar production into evening hours, while industrial consumers can adjust demand toward periods of low electricity prices. Stronger interconnections can facilitate exports of surplus generation, while hybrid solar-wind projects can provide a more balanced production profile.
The regional implications are significant. Romania’s relatively large and increasingly liquid electricity market could become an important source of competitively priced renewable power for neighbouring countries. Cross-border corporate power purchase agreements could also expand the market for Romanian solar generation. At the same time, projects such as Dama Solar, with approximately 1.04 GW of planned capacity, will place additional pressure on the transmission network and could influence price formation across markets stretching from Hungary and Bulgaria to Serbia and Moldova.
Romania’s second CfD auction has demonstrated that solar projects can be procured at scale and at competitive prices. The more difficult challenge now lies in preserving the value of the electricity those projects produce. As auction rounds approach the 1.5 GW scale, Romania and the wider SEE region will increasingly need storage, flexible demand, stronger grids and greater cross-border trading capacity to prevent rapidly growing midday solar output from becoming a source of market instability rather than an asset for the energy transition.
