Romania risks up to €6 billion in EU funds after Senate passes PSD amendments to energy and biodiversity laws

Senate adopts contested amendments

The Romanian Senate voted on 4 August 2026 to amend two laws tied to the National Recovery and Resilience Plan (PNRR): the decarbonization law and the national biodiversity strategy. The amendments, proposed by the Social Democratic Party (PSD) and supported by the Alliance for the Unity of Romanians (AUR), passed despite sharp criticism from government ministers and the interim prime minister. The decarbonization amendment stipulates that coal-fired power plants may be closed only after replacement capacity becomes operational, a condition that contradicts a milestone already closed and paid under the PNRR. The biodiversity strategy was altered with over 100 last-minute amendments, including the removal of an audit of protected area management and the elimination of co-administration with research institutions and NGOs.

Ministers warn of billions at stake

Minister of Investments and European Projects Dragoș Pîslaru said the decarbonization amendments would block payment requests 5 and 6 of the PNRR, putting €5 billion in non-reimbursable funds at risk. He accused PSD of placing party interest above the national interest and of reconfirming the alliance that brought down the government in May.

The consequences are a financial penalty and the blocking of payment requests 5 and 6. That means 5 billion euros non-reimbursable, because that is the real stake.

Interim Environment Minister Diana Buzoianu described the biodiversity amendments as "absolutely aberrant" and warned that Romania could lose €1 billion in European funds. She noted that some changes violate objectives Romania assumed at the European level in 2020, including the 10% strict protected areas and 30% active management zones targets.

Today, with the stroke of a pen, a national strategy changed an objective Romania assumed in a European strategy.

Interim Prime Minister Ilie Bolojan, present at the session, called the PSD amendment populist and cautioned that reopening a closed PNRR milestone could trigger penalties of €1 billion from the European Commission.

President threatens to send law back

President Nicușor Dan announced on Tuesday evening that he had promulgated a package of laws necessary for critical PNRR milestones, including the ratification of the SAFE Agreement, the Administrative Code, and the Urbanism Code. He stressed that EU funds mean better services and a higher quality of life for Romanians. At the same time, he warned that if Parliament adopts the decarbonization law in its current form, he will use all constitutional prerogatives, including requesting reexamination, to prevent the loss of billions of euros.

If Parliament adopts the law in the form resulting from the committee proceedings, I will analyse it with the utmost responsibility and will use all constitutional prerogatives, including requesting reexamination, so that Romania can submit the remaining payment requests and not lose billions of euros from the PNRR.

Political rupture and next steps

The vote deepened the rift between PNL and PSD. PNL first vice-president Dan Motreanu declared that the amendments endanger funds for schools, hospitals, and infrastructure, and ruled out any future governing cooperation with the Social Democrats.

Populism begins with applause and ends with the question: 'And now who pays?' PSD is once again putting billions of euros from the PNRR at risk.

Both bills now move to the Chamber of Deputies, where the final vote is scheduled for Wednesday, 5 August. The outcome will determine whether Romania can preserve its access to the remaining EU recovery funds or face financial penalties and blocked payments.