The World Bank, the European Bank for Reconstruction and Development (EBRD) and the Energy Community (EnC) have urged Serbia not
to delay implementation and not to amend the Law on the Use of Renewable Energy Sources, which is important for achieving the green transition of Serbian energy sector.
The institutions sent a letter to Prime Minister Ana Brnabic and Minister of Mining and Energy Zorana Mihajlovic, in which they say that accepting requests for a delay in implementing or amendments of the Law, a carefully drafted and well-balanced piece of legislation, may be
perceived as reneging on the achievements made, and chill investor confidence in the Serbian renewable energy sector.
The Law on the Use of Renewable Energy Sources was important for opening Cluster 4 (Green Agenda and Sustainable Connectivity) in the preaccession negotiations with the EU, and Minister Mihajlovic said that stopping that law means stopping investment and that changes in the energy system are inevitable, despite resistance and obstructions.
The World Bank, the EBRD and the Energy Community add that the new legal framework for renewable energy sources replaces long-term
administratively determined feed-in tariffs by a flexible and market-based regime and as such provides the basis for an increase of the share of renewables in Serbia at lower, competitive prices.
In late December, Serbian state-owned power utility EPS and electricity transmission system operator EMS have sent a letter to the Ministry of Mining and Energy asking for the amendments to the Law on Renewable Energy in order to not allow introduction of premium-based subsidies for production of electricity from renewable sources.
In the letter, EPS and EMS claim that the introduction of a large number of renewable energy facilities to Serbian electricity network could threaten its stability with increased risk of blackouts, and would cause increased costs that will be ultimately borne by end-users.
They claim that the number of requests for the connection of new RES facilities (mainly wind and solar) to the transmission network by 2027 will exceed the capacity of the network. Also, with the integration of these renewable capacity, the need for new balancing capacity would increase by additional 500 to 800 MW, compared to current 380 MW, which would increase balancing costs to between 150 and 340 million euros a year, compared to current 48 million euros. The increase in costs will be borne by Serbian citizens.
Therefore, the two companies ask that the balancing responsibility should be transferred from EPS to the owners of wind farms and that priority access to transmission system should not be granted for these facilities.
