Newsroom / News / Media / Info Magazine LGP NEWS 01/2021 / North Macedonia to become more climate-friendly

North Macedonia to become more climate-friendly

North Macedonia to become more climate-friendly

This emerging country in the Western Balkans wants to push climate-friendly investments in renewable energy projects. The goal is a green (re)construction program that envisions a more environmentally conscious and sustainable future in terms of hydro, solar and wind energy opportunities. 

North Macedonia, the southernmost Western Balkan state and a leading EU accession candidate, has immense potential for green energy production. Currently, the country is still hugely dependent on outdated, inefficient and highly polluting communist-era low-grade lignite coal power plants that account for a majority of its energy production. As a result, the country‘s total electricity production has also declined by 25% over the past decade, while the share of imported energy has increased to more than one-third over the same period. In order to ensure the energy security of North Macedonia, to tackle the notorious air pollution problem of the capital Skopje and the related public health problems, the aim now is to create a more livable future for future generations. To this end, the state has set ambitious targets for a green energy transition, aiming for a 50% share of renewable energy in electricity generation by 2024. In total, the state‘s planned energy transition strategy up to 2040 will require annual investments of 800 to 900 million euros. 

Solar Energy & Wind Farms 

High on the national agenda is the expansion of photovoltaic capacity in the country, which has a huge and largely untapped solar power potential: Since the adoption of a new Energy Law in 2018, several photovoltaic power plants have been built, including a state-owned 35 MW photovoltaic power plant and a 100 MW power plant at the former TEC Oslomej coal mine. With these investments, as well as another planned 20 MW photovoltaic power plant, the total capacity from solar energy should soon increase to 200 MW. 

In addition, the expansion of hydropower and wind power capacities is also a strategic priority: wind farms with an additional capacity of 160 MW are being considered here, including 100 MW wind farms on state-owned land with private investors, which are expected to cost over 150 million euros. The Čebren hydropower project in public-private partnership on the Crna River has also attracted strong investor interest. The project is worth between 500 and 600 million euros and will have a capacity of at least 333 MW. 

The winner of the bidding process will also be awarded the contract to operate the 116 MW Tikveš hydropower plant. In addition, the government has approved a program to promote renewable energy and energy efficiency in private households for 2021. With a budget of over 840,000 euros, including over 130,000 euros in grants for „prosumers“ (simultaneously producer and consumer), the state will cover up to 30% of the cost of purchasing and installing photovoltaic systems to produce electricity for self-consumption. 

Overall, North Macedonia is a prime target country for international investors in the renewable energy sector – particularly in solar, wind and hydropower as examples of long overdue investment in the country‘s increasingly aging energy infrastructure. LGP Skopje advises a number of interested parties on North Macedonia’s green energy opportunities and acts as the first point of contact for potential investors seeking local knowledge combined with leading international service quality at a high level.


AUTHORS:

Suzana Anchevska, Business Development at LANSKY, GANZGER + partner Skopje
Philipp Freund, MA. BA., Head of Business Development and Policy Advisor at LANSKY, GANZGER + partner

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