Advancing the Black Sea Clean Energy Transition Through Connectivity and Cooperation

Grid Bottlenecks, Price Volatility and the Reality of European Interconnectivity

Europe electricity interconnectors are central to the functioning of the continent’s power markets. Yet despite improved market integration over the past decade, electricity systems across Central and Eastern Europe remain exposed to congestion, price volatility and winter stress events.

These challenges were examined during a panel discussion at Energy Week Black Sea 2026, where market experts, regulators and traders explored how grid constraints and regulatory frameworks continue to shape electricity price dynamics across the region.

Price convergence does not eliminate volatility

Opening the discussion, moderator Apostolos Tsarikas of Argus Media framed the debate in the context of a difficult start to 2026. A severe winter, depleted gas and hydro stocks, and the first full implementation phase of the Carbon Border Adjustment Mechanism (CBAM) have exposed structural weaknesses in European market integration.

@Jérôme Le Page, Chair of the Electricity Committee at the European energy trading association Energy Traders Europe, noted that long-term price convergence across European electricity markets is real. Price differentials between Germany and markets such as Greece and Romania have narrowed significantly over the past decade.

However, convergence does not eliminate volatility. During system stress events, limited electricity interconnector capacity in Europe and inconsistent use of existing infrastructure amplify price spikes in Eastern markets.

Why interconnectors depend on regulatory discipline

From a trader’s perspective, interconnectors are not only about physical infrastructure but also about how transmission capacity is allocated and managed.

The implementation of the EU 70 percent minimum capacity rule, designed to ensure that transmission operators make sufficient cross-border capacity available to the market, was highlighted as a key regulatory tool. Stronger regulatory oversight is increasingly seen as essential to ensure that existing interconnectors are fully utilised.

This discussion reflects a broader challenge across European electricity markets: building new infrastructure is necessary, but effective governance of existing networks is equally critical.

Romania and the European grid planning framework

Dr. @Costin-Mihai Păun, President of the Energy Security and Investments Commission and Supervisory Board Member at Transelectrica, linked the regional discussion to the wider European grid development strategy.

Romania and neighbouring countries participate in the ENTSO-E Ten-Year Network Development Plan (TYNDP), which identifies priority transmission investments aimed at addressing congestion and strengthening European energy connectivity.

Projects emerging from this framework may receive support through the Connecting Europe Facility (CEF), one of the European Union’s main instruments for financing cross-border infrastructure.

According to Costin-Mihai Păun, large-scale grid projects require more than financing. Successful implementation depends on coordination between transmission system operators, distribution operators, regulators and governments.

In a region increasingly shaped by geopolitical risk, grid resilience is now closely linked to energy security.

Interconnection capacity versus market reality

A recurring theme of the discussion was that interconnection is not solely about building new lines.

Romania’s technically available cross-border capacity already ranges between 3,500 MW and 4,500 MW. Electricity flows towards Ukraine and Moldova have increased nearly tenfold since synchronisation with the European electricity system.

Despite these improvements, market participants argued that operational rules and capacity availability still lag behind Western European practices. As a result, congestion and price volatility remain persistent features of electricity markets in South-East Europe.

Europe’s grid challenge: infrastructure and governance

The panel concluded that Europe’s grid challenge is twofold.

On one hand, additional electricity interconnectors across Europe are needed to support renewable integration, cross-border trade and system balancing. On the other, stronger governance of existing infrastructure is equally important.

Without clearer implementation frameworks and stronger regulatory discipline across European electricity markets, grid bottlenecks and price volatility will continue to shape the region’s power markets.