Serbia’s planned €2.6 billion Đerdap 3 pumped-storage hydropower project is advancing through technical preparation, but its investment viability will depend on water-management agreements with Romania, environmental requirements and the operating needs of the Danube system.
The project is being assessed at up to 1,800 MW, compared with earlier EPS concepts of 2,400 MW and approximately 578 million cubic metres of storage. It would store electricity during periods of low prices and release it during peak demand, while providing balancing and reserve services.
Romania’s Hydropower and Nuclear Interests
The existing Iron Gates complex has approximately 2.9 GW of combined hydropower capacity on the Serbian and Romanian sides. EPS operates 1,140 MW at Đerdap 1 and around 270 MW at Đerdap 2, while Romania’s Hidroelectrica operates approximately 1,166 MW at Porțile de Fier I, alongside additional capacity at Porțile de Fier II and Gogoșu.
Downstream, Romania’s Cernavodă nuclear power plant, with approximately 1.4 GW of gross operating capacity across two reactors, relies on the Danube for cooling. A severe drought forced both units to shut down, highlighting the importance of reliable river flows for Romania’s electricity security. Although Đerdap 3 would not continuously consume the water it pumps, initial reservoir filling and routine operations could temporarily affect downstream availability. Restrictions during droughts could limit pumping when electricity prices are favourable, reducing the plant’s potential revenue.
Stored Water Could Support Regional Energy Security
Romania is examining measures to improve Cernavodă’s cooling-water security, including dredging and hydraulic interventions in downstream channels. Plans for additional nuclear capacity could further increase the importance of reliable Danube flows.
EPS has also identified the possibility of releasing water stored at Đerdap 3 to support downstream cooling during droughts. Such an arrangement would require clear rules on reserve volumes, release decisions and compensation for water withheld from commercial electricity trading.
Existing bilateral arrangements govern the operation of the shared Iron Gates facilities. Romania could seek restrictions on reservoir filling, drought-period pumping, daily water-level fluctuations and minimum downstream releases, potentially affecting the plant’s commercially available capacity.
Černi and Bechtel–Enka Advance Development
The Jaroslav Černi Water Institute, part of the Millennium Team group, leads the consortium preparing early planning and technical documentation. Its work will help establish the hydrological assumptions, reservoir design, environmental baseline and estimated investment costs.
The Bechtel–Enka consortium has qualified for negotiations on further project and technical work. However, qualification does not constitute a final construction award or financial close. Changes arising from Romanian requirements, hydrological modelling or geotechnical investigations could still lead to redesigns, delays and higher costs. Independent technical review will be important before Serbia commits to construction, including an assessment of whether a smaller or phased project would offer better value.
Investment Returns Depend on Operating Restrictions
At an estimated €2.6 billion, Đerdap 3 would compete with batteries, grid reinforcement, interconnections, demand response and upgrades to existing hydropower plants.
At an illustrative 80% round-trip efficiency, electricity purchased at €50/MWh would cost €62.50/MWh for recovered electricity, excluding operating expenses, financing and capital recovery. Restrictions on pumping could further reduce the number of profitable operating cycles. The project’s bankability will ultimately depend on whether it can deliver attractive returns under realistic hydrological conditions, Romanian operating requirements and drought scenarios, rather than under assumptions of unrestricted operation.
