The European Commission has opened an in-depth investigation to assess whether the public support that Romania intends to grant for the technological upgrading and life extension of Unit 1 of the Cernavodă Nuclear Power Plant is in line with EU state aid rules, the institution announced. The decision is a standard procedure for highly complex energy projects and, given the decision-making practice in similar cases, we expect a favorable decision early next year, stated Bogdan Chirițoiu, president of the Competition Council, quoted by the central press, following the announcement.
In January 2026, Romania notified the Commission of its intention to support the technological upgrading of Unit 1 of the Cernavodă Nuclear Power Plant, maintaining the same electricity production capacity of 706 megawatts, so that it can operate for another 30 years.
Unit 1's reactor was commissioned in 1996. Currently, it provides approximately 10 % of Romania's electricity needs. As the reactor is scheduled to reach the end of its estimated lifespan in 2027, extending its life with a new 30-year operating cycle is essential for ensuring the long-term availability of low-carbon electricity. The project's objective is to enhance Romania's electricity supply security and contribute to the Union's decarbonization goals. The beneficiary of the support is Compania Națională Nuclearelectrica S.A. (SNN), the owner and operator of the Cernavodă Nuclear Power Plant, which is majority-owned by the Romanian state and is also the country's sole nuclear power operator. The estimated nominal value of the project is EUR 3.2 billion.
Romania intends to support the nuclear unit's retooling through four measures: a grant worth EUR 600 million; state guarantees for loans taken out to finance the investment; a 30-year bilateral Contract for Difference (CfD) intended to ensure stable revenues for the plant and a protection mechanism in case of regulatory changes during construction and operation.
At this stage, based on its preliminary assessment, the Commission considers that the measure is necessary and that the aid facilitates the development of an economic activity. However the Commission has doubts as to the full compatibility of the measure with EU State aid rules. For this reason, the Commission has decided to open an in-depth investigation in order to determine:
- adequacy and proportionality of the aid package. As there are several aid measures that, together, can limit risks for the beneficiary, it is important to ensure that in the end no more aid than necessary is granted. In particular, the Commission has doubts as to whether the proposed package strikes an adequate balance between reducing risks to create favorable conditions for investment and maintaining incentives for efficient conduct, while avoiding excessive transfer of risks to the state;
- the impact of the aid measure on market competition and whether it is minimized. In particular, the Commission fears that several essential elements of the contract for difference do not provide effective incentives for operation and maintenance. At this stage, the Commission cannot conclude that there are sufficient safeguards to prevent the aid from being passed on to consumers or certain market participants.;
- compliance with other provisions of EU legislation, in particular with the principles governing the design of support schemes in the form of two-way contracts for difference, principles laid down in Article 19d(2) of the Electricity Regulation.
The Commission will now continue its investigation to determine whether its initial concerns are confirmed. The opening of an in-depth investigation will give Romania and any other interested third parties the opportunity to submit their observations, without prejudice to the outcome of the investigation.
Under the Treaty on the Functioning of the EU (TFEU), Member States are free to determine their energy mix, the conditions under which they exploit their energy resources, and the general structure of their energy supply. The decision to promote nuclear energy is a national competence.
State aid for the support of nuclear energy can be assessed directly under Article 107(3)(c) of the TFEU, which allows Member States to facilitate the development of certain economic activities under specific conditions. Aid must be necessary and proportionate and must not unduly affect trading conditions to an extent contrary to the common interest. Following the entry into force of the new rules on the organization of the electricity market in July 2024, the Commission is also assessing compliance with the principles for the design of support schemes applicable to two-way contracts for difference, as provided for in Regulation 2024/1747, the institution further states.