Abstract Positive Energy Districts (PED) have surged in prominence amidst Europe’s ambitious climate targets and the fluctuating energy landscape, influenced notably by geopolitical uncertainties such as the Ukraine conflict. Aligned with European and national priorities, which emphasises the renovation of its housing stock as part of the Renovation Wave initiative, PED emerges as a viable solution for urban areas. However, the challenge remains in how PED can address energy poverty, promote renewable energy, and align with renovation priorities of the outdated infrastructures (including buildings). The KINETIC project addresses PED transformation challenges at the neighbourhood level by deploying an intensive co-creation process for identifying key transformation directions. The Romanian DEMO area (along with DK and IT study cases) is the Drumul Taberei neighbourhood in Bucharest Sector 6, a dense neighbourhood composed of multifamily buildings realised in the 60s and 70s during the communist regime. The area needs comprehensive regeneration and renewal initiatives. If proven feasible through mathematical modelled data paired with strategic integrated planning, the outcomes of KINETIC for the Drumul Taberei neighbourhood will be able to revolutionise the future rehabilitation project of collective housing districts in Romania, and beyond. The paper will outline PED transformation pathways stemming from initial co-design workshops involving local stakeholders. It will also explore collaboration and investment prospects between municipality-housing associations and NGOs. Given the privately owned housing estate and state-funded rehabilitation, the project will assess innovative models to meet PED’s ambitious goals.