/LONDON, March 16, 2023, 11:00 GMT, RENEWABLE MARKET WATCHTM/ Between 2012 and 2022, the Western Balkan Countries increased their solar power capacity 11 times. Western Balkans became one of the fastest-growing regions in Europe, with a 28.1 per cent increase in cumulative solar photovoltaic (PV) installed capacity in 2022 compared with 2021. The number of fully permitted and ready-to-build projects is promptly increasing. The rooftop solar PV market segment in many countries in this region is underdeveloped and is forecasted to grow significantly. Energy demand in the region is constantly increasing, according to the Western Balkans Solar Photovoltaic (PV) Power Market Outlook 2023÷2032. Some countries can exceed their electricity production demand needs with renewable energy support.
Due to the War in Ukraine, governments in Western Balkan countries will need help managing the energy supply's sustainability, security and affordability in a highly volatile energy market environment. Businesses in Western Balkans promptly started to look for alternatives to expensive fossil fuel-based power sources. The interruption of gas supply from Russia to some countries in the Western Balkans region will delay the planned phase-out of coal power plants, and electricity will remain expensive in the next 2- 3 years. This may favour solar energy development as the fastest deployable and cheapest renewable energy source.
In electricity production, coal is the dominant energy source in Western Balkans, accounting for between 43 per cent to over 80 per cent in some countries, followed by hydropower with a share of between 15 per cent to over 85 per cent in some countries. In those countries with a predominant share of large coal reserves, an increase in natural gas use and renewable energy deployment can be expected due to ecological requirements and the need to reduce CO2 emissions.
The Western Balkan countries are home to the most polluting coal power plants in the whole of Europe, according to the Health and Environment Alliance (HEAL). Annual emissions from the 16 coal power plants (16 GW) in the Western Balkans are almost as high as from the 296 existing coal plants (156 GW) in the EU-28. Coal power plants in the Western Balkans cause damage to health beyond national borders due to the long-distance travel of pollutants in the air. The health damage caused by combustion in coal plants is not limited to the power plant's proximity. Some pollutants in exhaust clouds from the smokestack can be transported to neighbouring European countries and beyond. This means that plants in the Western Balkans can significantly contribute to overall air pollution on the continent. Controlling air pollution from coal power plants is a huge opportunity to save 6,460 lives and 2,724 mil EUR in healthcare costs in the next decade. Implementing more stringent environmental rules in the Western Balkans is an opportunity to reduce the number of premature deaths and improve people's health not only in the Western Balkan region but across Europe.
The Platform Initiative in Support of Coal Regions in Transition in Western Balkans and Ukraine, created in September 2019, will assist the coal regions of the Western Balkans in developing and implementing comprehensive policies that enable inclusive strategies for transitioning to low-carbon energy systems. It brings together international institutions and partners in both areas to deliver knowledge, share lessons learned from regions in the European Union and beyond, and provide planning support and financing.
The initiative was established after Western Balkan countries committed to moving towards clean energy in the Podgorica Joint Statement of 21 February 2019. The establishment of the Platform mirrors a similar approach within the EU, where a “Just Transition Platform” supports the implementation of the Just Transition Mechanism. This pledges at least €100 billion in investments over the period 2021-2027 to support workers and citizens of regions where high-carbon assets are located.
The EBRD’s Green Economy Transition (GET) approach 2021-25 aims to increase the Bank’s green financing to more than half its annual business volume by 2020 while helping countries where it works build low carbon and resilient economies. In line with the Paris Agreement and the GET approach, the EBRD’s own Just Transition Initiative, launched this year, aims to ensure the benefits of a green economy transition are shared while protecting vulnerable countries, regions and people from falling behind. It will do this by combining its expertise in green economy investments with its focus on economic inclusion.
Since the middle of 2021, renewable energy producers in Western Balkan countries have been increasingly terminating their long-term contracts based on feed-in tariffs and other government incentives. They are starting to sell electricity on the free market. Rising market prices present new business opportunities for independent renewable power producers (IPPs) and buyers of green electricity.
Non-hydro renewables such as solar and wind have a limited presence in the energy mix of Western Balkan countries but are steadily increasing in the past few years. The region has a significant transformation potential towards a low-carbon energy system, according to the Renewable Market Watch™. Only Albania has no reliance on coal, with the generation coming exclusively from hydro. In contrast, half of Bosnia and Herzegovina's installed capacity is based on coal-fired power plants, rising to almost two-thirds in Serbia and nearly 100 per cent in Kosovo.
Large-scale investments in renewable energy projects provide alternative power sources to traditional coal, and work is being carried out to modernise the district heating networks across the region. In the Western Balkans Solar Photovoltaic (PV) Power Market: Outlook 2023÷2032, more than 109 solar projects across the region are featured. Still, some of the most important have been financed with the EBRD's support.
More substantial efforts towards further development and reducing administrative barriers of governments of Western Balkan countries will make the solar sector more productive and competitive and accelerate its evolution. As a result, the whole community will benefit from the increasing possibility that solar photovoltaic energy will be able to contribute substantially to the Western Balkan countries' electricity generation by 2032.
The more information about the solar power market in Western Balkans, including full contact details of solar project owners and developers, you may read here: Western Balkans Solar Photovoltaic (PV) Power Market Outlook 2023÷2032
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To download the executive summary brochure with sample pages for the solar sector in Western Balkans, please access from here: Western Balkans Solar Photovoltaic (PV) Power Market Outlook 2023 - 2032- Sample
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