Serbia and Romania have signed a memorandum of understanding covering the proposed Djerdap 3 pumped-storage hydropower plant. The agreement formalises cooperation and restarts preparations for one of Southeast Europe’s largest prospective electricity-storage projects.
The two governments plan to set up joint working groups to exchange technical information and coordinate project development. Serbia expects work on the spatial plan and technical documentation to start during 2026. Six expressions of interest submitted through an earlier public call remain under review.
Project design and role in power system flexibility
The proposed Djerdap 3 facility would have an installed capacity of approximately 2,400 MW. Current planning envisages an upper reservoir on the Serbian side of the Danube. The design includes large pipelines connecting that upper reservoir to the existing Djerdap reservoir.
Under the concept, electricity would be used to pump water uphill during periods of low demand or when renewable output is abundant. Stored water would then be released to generate power during high-price periods and times of system stress. The project is positioned to change Serbia’s flexibility profile as it expands variable generation.
Serbia is developing a pipeline of wind and solar projects but continues to rely on lignite generation, hydropower and imports to manage demand swings and renewable variability. Pumped storage would be used to absorb surplus production, provide balancing capacity and reduce exposure to expensive evening imports.
Integration with US-backed strategic cooperation
Djerdap 3 is also being advanced under Serbia’s Strategic Energy Cooperation Agreement with the United States. This links the project to a broader financing and geopolitical dimension within that framework.
The eventual project structure could involve international contractors, equipment suppliers, development institutions and commercial lenders. Procurement, ownership and financing arrangements are not yet defined.
Romanian requirements for the shared Danube system
Romanian participation is described as essential because the development would affect the shared Danube system. It would also influence operations at the existing Djerdap 1 and Djerdap 2 hydropower plants.
Bucharest has indicated that Djerdap 3 must preserve navigation. It has also set requirements to protect riverbank areas in Romania and Bulgaria while avoiding disruption to the operational regime of the two existing plants.
Environmental modelling, hydraulic studies and cross-border operating rules
The project places environmental and hydraulic modelling at the centre of development work. The upper reservoir, pumping cycles and downstream water management changes would require coordinated environmental assessments.
The operating rules would need to be acceptable to both countries. Spatial planning, geological investigation, hydraulic modelling and grid studies are expected to progress alongside an agreed cross-border operating framework before a credible CAPEX envelope can be established.
Investment scale and revenue considerations
A 2,400 MW pumped-storage scheme is described as requiring several billion euros in investment. The development would also involve a long construction period. Revenue streams are expected to extend beyond conventional electricity sales.
Bankability would depend on a combination of peak–off-peak arbitrage, balancing services, capacity value and potentially regulated system-support payments. Phased technical development is therefore described as indispensable ahead of an investment decision.
