Romania and Bulgaria roll out CARMEN smart grid project backed by EU funding

Romania’s push to modernize power infrastructure is getting a major boost through a cross-border smart grid program designed to make the regional system more flexible as cleaner energy expands. The CARMEN Smart Grid project brings together transmission and distribution operators in Romania with a Bulgarian partner, with European financing intended to accelerate upgrades that can also improve interconnection performance between the two markets.

EU-backed financing signed in Copenhagen

The financing agreement for CARMEN Smart Grid, valued at approximately €207 million, was officially signed on 22 May in Copenhagen during the Energy Infrastructure Forum. The deal was finalized with representatives of the European Climate, Infrastructure and Environment Executive Agency, with senior officials from the European Commission present.

Under the agreement, European support will contribute nearly €104 million through the EU’s Connecting Europe Facility program, which backs Projects of Common Interest. The remaining portion will be provided directly by the participating companies.

Who invests what

Delgaz Grid, part of the E.ON group in Romania, will manage investments worth €77.5 million, with almost €39 million covered by EU grants. Transelectrica will invest around €70.7 million supported by approximately €35.4 million in non-reimbursable European financing. ESO’s investment share amounts to €59.3 million, with €29.6 million financed through European support.

First Romanian Smart Grids Project of Common Interest

The CARMEN initiative is described as the first Smart Grids Project of Common Interest in Romania to receive European financial backing for modernization across both transmission and distribution electricity networks. Its stated focus is on strengthening infrastructure using advanced digital technologies while enabling greater integration of renewable generation into the regional power system.

Planned upgrades and cross-border benefits

The project includes network automation, modernization of existing infrastructure and installation of advanced monitoring systems aimed at improving reliability, operational flexibility and overall energy security. It is also expected to raise cross-border electricity exchange capacity between Romania and Bulgaria by reducing network congestion and enhancing interconnection capabilities.

Technologies expected to be deployed include Dynamic Line Rating systems, FACTS equipment and real-time monitoring solutions. These tools are intended to improve supply stability while allowing transmission and distribution operators to coordinate more efficiently via shared digital platforms and enhanced data exchange systems.

Strategic importance for Europe’s decarbonization goals

Beyond grid performance improvements, the broader objective is to support European climate aims by improving renewable energy integration, increasing energy efficiency and developing infrastructure aligned with the EU’s long-term decarbonization strategy.