EU, EIB, EBRD and World Bank to finance permanent interconnection between electrical networks of Moldova and Romania

In a joint effort to strengthen the Republic of Moldova’s energy security, the EU, the European Investment Bank (EIB), the European Bank for Reconstruction and Development (EBRD) and the World Bank are providing a EUR 270 million package to finance a permanent interconnection between the electrical networks of Moldova and Romania.

This interconnection is seen as being of critical importance for the diversification of Moldova’s electricity resources, as the country currently depends on a single plant fuelled by natural gas, oil and coal and electricity imports from Ukraine for up to 80 percent of its supplies. The link to Romania’s electrical network will considerably enhance the stability and reliability of its power supply – a prerequisite for Moldova’s economic development.

The diversification of electricity resources will open up Moldova’s electricity market to increased competition, with the enhanced access to the European market generating economic benefits for both companies and citizens. The project will ultimately pave the way towards Moldova’s integration into the European electricity grid, ENTSO-E.

Moldova Deputy PM Octavian Calmic said: “Not only will this project provide a higher level of energy security, it will also contribute to competitive prices on the domestic electricity market, permanent access to regional electricity market and, as a result, an energy price that is less burdensome for consumers”.

The investment package includes EIB and EBRD loans of EUR 80 million each, one EUR 70 million loan from the World Bank and a EUR 40 million investment grant from EU funds. It covers the construction of a new 400 kV high-voltage overhead line between Vulcanesti, in the south of Moldova, and the capital Chisinau, the upgrading and expansion of the substations in Chisinau and Vulcanesti and the construction of a 600 MW back-to-back converter substation in Vulcanesti.