Transelectrica to Build 19 Interconnectors by 2035 — NRG-IA

Romania’s national electricity transmission system operator, Transelectrica, has earmarked a budget of RON 2.3 billion to expand the cross-border interconnection capacity of the national power grid, according to data published by Financial Intelligence. The grid development plan envisions increasing the number of high-voltage transmission lines connecting Romania to neighboring states from 11 currently to 19 by 2035. This more than 70% expansion of physical border infrastructure directly responds to calls from the National Energy Regulatory Authority (ANRE) to expedite connection projects with the Hungarian and Bulgarian grids. The financial and economic stakes of this program extend far beyond pure grid engineering, directly impacting price formation on the Romanian electricity market. In recent years, the day-ahead market managed by OPCOM has frequently registered wholesale prices significantly higher than those in Central and Western Europe, particularly during periods of extreme temperatures or low wind generation. The root cause of this spread is insufficient physical transmission capacity between Central Europe and Southeast Europe, which prevents the unhindered flow of cheap surplus power from western markets to the southeast. How border bottlenecks inflate Romanian electricity prices The European electricity market operates on the principle of market coupling, a mechanism designed to automatically route electricity from surplus, low-cost regions to deficit, high-cost areas. However, this arbitrage only works as long as physical transfer capacity remains available on cross-border high-voltage lines. Once interconnectors between Austria, Slovakia, Hungary, and Romania hit their maximum transmission limits, the markets become physically and commercially decoupled. When grid saturation occurs, Romania, Bulgaria, and Greece become isolated within a high-price island. During peak evening hours—when solar output drops to zero—meeting domestic and regional demand relies on dispatching gas- or coal-fired power plants with high marginal generation costs. Lacking sufficient 400 kV lines at the western border to import lower-cost nuclear or renewable energy from Western and Northern Europe, Romanian suppliers and industrial consumers end up paying prices set by the most expensive power units in the regional dispatch stack. Regulatory pressure from ANRE and priorities on the Hungarian and Bulgarian borders The allocation of the RON 2.3 billion ceiling comes amid regulatory pressure from ANRE to accelerate transmission grid investments. The energy regulator explicitly urged prioritizing cross-border lines with Hungary and Bulgaria, Romania’s two EU borders through which integration into the single European electricity market takes place. The Hungarian border serves as the main gateway for power flows from Central Europe, while the Bulgarian border enables transit along the southeastern corridor and connects to the power systems of Greece and Turkey. Constructing eight new cross-border high-voltage lines involves much more than raising pylons near border points. To prevent imported or exported power from clogging the internal grid, the new interconnectors require completing Romania's internal 400 kV ring and upgrading substations in the western, southern, and eastern parts of the country. Without reinforcing the internal network, additional capacity delivered to the border would create bottlenecks inside the national system, forcing the dispatch operator to curtail commercial cross-border flows once again. Balancing new green capacity and tapping EU funding Expanding cross-border interconnectors is equally vital in reverse, for electricity exports. As new solar and wind farms plug into the Romanian grid, the power system experiences generation surpluses during sunny or windy midday hours that far exceed domestic demand. If cross-border grid capacity cannot evacuate this surplus to neighboring countries, hourly spot prices plummet toward zero or turn negative, eroding generator revenues and chilling investment in new capacity. The 19 interconnection lines planned by 2035 will provide the power grid with a bidirectional relief valve: import capacity during peak demand hours to cap price spikes, and export capacity during periods of renewable oversupply to maintain grid stability. Financially, such strategic investments rely on blending regulated transmission tariffs with non-reimbursable grants from the EU Modernisation Fund and EU programs for Projects of Common Interest (PCI), mitigating the direct impact on network tariffs borne by end-consumers. Execution timeline and critical milestones through 2035 The 2035 timeline reflects the realistic implementation timeframe for high-voltage infrastructure projects, where land acquisition, environmental permitting, equipment procurement, and coordination with neighboring TSOs typically take five to eight years per line. Consequently, market impacts will not materialize…