Investor state or catalyst state?

Should the state invest in energy? The answer is obvious: yes! The energy transition, supply security, and critical infrastructure require public involvement. The real question is different. How will it do this and what kind of state does Romania want to be?

Does Romania want to be an investor state, forced to constantly compensate for the absence of private capital (which the state itself drives away)? Or does it want to have a catalyst state, capable of creating the framework in which private and public investments complement each other? The difference between these two modes of manifestation is enormous. The first implies constant pressure on public finances, dependence on political cycles, and decision-making concentration. The second implies mobilizing capital volumes incomparably larger than those the state can generate alone. I believe that this choice actually holds the stakes for the next decade.

Romania is (still) in a historically favorable period. It has relevant natural resources, access to European funds, strong energy companies, and a strategic position in a Europe that seeks energy security and economic autonomy. Paradoxically, this favorable context can generate a dangerous illusion: the belief that the state can finance alone the energy transformation that has already begun. The reality is that no European public budget can sustain alone the necessary investments for the complete modernization of the energy sector. These investments will require hundreds of billions of euros at the European level and tens of billions in the case of Romania. And these billions cannot come exclusively from state-owned companies, European funds, or national budgets. They will require massive participation from private capital.

From this perspective, the real challenge is not building a stronger investor state. It is building a state credible enough that investors want to build alongside it. Because Romania's energy future will not depend on how large the state is in the economy, but on how capable it is to inspire confidence in those who are ready to invest in it.

In recent years, Romania has gone through one of the most interesting transformations in its post-communist energy history. After three decades in which the dominant discourse was liberalization, European integration, and attracting private investments, the reality of recent years seems to indicate a subtle but profound change: the return of the state to the center of energy development. This is not about a formal renationalization nor about abandoning the market economy. The phenomenon is more complex. Against the backdrop of successive crises – pandemic, war, energy volatility, inflation, and geopolitical uncertainty – the state has once again become the main guarantor of economic security. In energy, this trend is even more visible. The major strategic projects currently under development have, in one form or another, the Romanian state at their center. From nuclear reactors to hydropower investments and new natural gas capacities, public institutions and state-controlled companies represent a factor in the transformation of the sector. But are we witnessing the consolidation of a strategic development model or the emergence of an energy economy in which the state invests, while private capital prefers to watch from the sidelines?

A decade ago, many analysts believed that the role of the state in energy would gradually reduce to that of regulator and arbiter. However, the European reality has evolved in a different direction. The geopolitical competition between major economic blocs, the energy transition, and the need for strategic autonomy have brought industrial policy back to the center of economic decisions. The United States massively subsidizes green industries. China continues to use the tools of state capitalism. The European Union is developing its own support mechanisms for sectors considered strategic.

Romania is no exception. In a context marked by volatility and risk, if it acts intelligently, the state can become the actor capable of attracting and mobilizing private capital, managing complex projects in public-private partnerships, and assuming investment horizons that the market views with caution in the absence of signals of trust. But Romania should not build a modern energy market predominantly relying on a few state-controlled champions. There is a fundamental difference between the existence of high-performing public companies and their transformation into the main investment vehicle of the energy economy. A healthy market needs competition, capital diversity, and the multiplication of investment decision-making centers. When most major projects revolve around the same actors, the risk is not the lack of performance, but excessive concentration.

Private capital has not disappeared. It has become cautious. A frequent perception in the public space is that the private sector does not invest enough. The reality is more nuanced. Infrastructure funds, institutional investors, and large energy companies today have significant liquidity and are looking for opportunities in Central and Eastern Europe. Romania continues to be attractive due to its natural resources, market size, and geostrategic position. What is often lacking is not the appetite for investments, but the confidence in the stability of the rules. Private capital can accept commercial risks. It can accept market volatility. It can even accept economic cycles. What it finds much harder to accept is institutional uncertainty. When exceptional taxes appear overnight, market mechanisms are administratively suspended, and rules change frequently, investors do not necessarily leave the market. They adopt a wait-and-see strategy.

In energy, this waiting can last for years. And we should not allow ourselves this.