Solar energy is one of the most active investment segments in Romania. Investors usually choose between two types of assets: projects that are ready to build (RTB) and solar parks that are already operating. Each has a different risk and return profile.
Ready-to-build projects
An RTB project has the permits needed to start construction, but no panels on the ground yet. It usually offers a higher potential return, but the investor takes on construction, cost and timing risk.
What makes a project truly ready to build:
- Land rights: ownership, long-term lease or building right (superficie), registered in the land book.
- Urban planning: urbanism certificate and, for land outside the built-up area, an approved zonal urban plan (PUZ) and the removal of the land from agricultural use where required.
- Environmental approval from the competent environmental authority.
- Grid connection: the technical connection approval (ATR) from the grid operator, with a clear capacity, connection point and cost estimate. This is often the most valuable and scarce element of a project.
- Building permit for the plant and the connection works.
Operating plants
An operating park already produces energy. The return is lower, but more predictable. Due diligence focuses on:
- production history compared with the original estimates;
- how the energy is sold: on the market, through a power purchase agreement (PPA) or under a support scheme such as the Contracts for Difference introduced by Romania;
- the production licence from ANRE, the energy regulator, where required;
- operation and maintenance contracts, warranties of panels and inverters;
- the condition of the equipment and the land rights for the remaining lifetime.
Price logic
Prices are usually discussed per megawatt (MW). For RTB projects, the value depends mainly on the quality of the grid connection and on how complete and solid the permits are. For operating plants, it depends on the expected cash flows and on the remaining life of the asset.
Common pitfalls
- grid connection approvals that are close to expiry or have unrealistic costs;
- land rights that do not cover the full lifetime of the plant;
- permits issued to a different company from the one being sold;
- optimistic production estimates that are not supported by data.
We support investors in the purchase and sale of solar parks in Romania, from project screening to closing. Talk to us about your criteria.
This article is general information and is not legal, tax or investment advice.