Serbia: New energy law to boost RES projects, 700MW cap for wind developers

19. January 2015. / News Serbia Energy

The extent to which solar has fallen out of favor in Serbia since ambitious plans for a 1 GW solar farm fell through has been spelled out by the government’s announcement that its PV ambitions amount to 10 MW of new capacity up to 2020.

Although the Belgrade government rushed through the adoption of an EU measure last month to liberalize its electricity market, the chief beneficiaries are likely to be wind developers, with national policy-makers aiming for 700 MW of new capacity by 2020.

In a bid to fast-track its EU membership ambition, Serbia last month rushed through adoption of the EU’s Third Legislative Energy Package.

It is hoped the removal of the power monopoly enjoyed by the National Power Industry – Elektroprivreda Srbije, or EPS – and transmission grid owner Elektromreze Srbije (EMS), will see consumers shop around for alternative providers to the two state-owned companies.

Under the EU directive adopted, power companies can either entirely relinquish ownership of their grid, network management and corporate subsidiaries; can separate off only the management company; or can retain the status quo with the caveat that the latter two options would see the introduction of regulatory bodies with the power to issue binding decisions and penalties on the utilities concerned.

The hope is that the removal of the state-owned monopoly will permit access for independent generators and drive investment in energy projects.

But with large scale hydro supplying virtually all of the 29% of Serbia’s current renewables power the government appears to be betting on wind to largely plug the gap in a country in which only 5-6 MW of power is supplied by photovoltaics.

Meanwhile, the legacy of the nation’s previous high-profile attempt to embrace solar is still dragging through the courts after Serbia’s flagship PV project, the 1 GW solar farm owned by Luxembourg-based Securum Equity Partners Europe (SEPE) was abandoned.

In 2013, SEPE announced it would bring Serbia’s government to the International Court of Arbitration in London over abandoning plans for the construction of the project and demanding €1.7 billion ($1.97 billion) compensation.

SEPE argues the Serbian government did not provide the land promised for the project whilst the Serbian ministry of energy says it offered land ten times the area requested but SEPE rejected it.

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