Serbia’s energy minister Aleksandar Antic said that Serbia needs more investment in renewable energy projects, mainly to relieve pressure on Elektroprivreda Srbije (EPS), the sole power producer.
“Coal-fired power plants are becoming increasingly unprofitable as EU environmental rules kick in and a quick transition to renewable energy is needed,” Dragan Vlaislavljevic, the head of electricity distribution director at EPS, said.
The country is building wind farms with a combined installed capacity of 483 MW, in different stages of development, Antic said. “The total capacity of wind farms in Serbia by the end of 2018 is expected to reach 100 MW,” he said and added that the first wind farms with a combined capacity of 17 MW have already started operating in Serbia.
“The EU is expected to increase its support for Serbia with the introduction of renewable energy facilities in the short term,” Oskar Benedikt, head of the EU delegation to Serbia, said.
The Green for Growth said in June it will lend EUR20m to UniCredit Bank Serbia, an arm of Italy’s UniCredit Group, to “reduce carbon dioxide emissions” by lending the funds to enable “renewable energy projects.” GGF will provide support to end-borrowers through MACS Management & Consulting Services, a Germany-based sustainability consulting firm.
“This new partnership with UniCredit Bank offers the GGF the chance to help build and strengthen Serbia’s renewable energy sector with long-term, competitive financing, which supports the fund’s overall mission to promote renewable energy and energy efficiency in the markets it serves,” Christopher Knowles,” the Chairman of GGF said.
UniCredit Group reports its collective “exposure [to] the renewable energy sector…exceeded EUR9.4bn” as of the end of 2016.
Created by the EU’s European Investment Bank and Germany’s KfW Development Bank, GGF focuses on extending the use of renewable energy sources and enhancing energy efficiency in Southeast Europe. As of 2015, it reported an outstanding portfolio of EUR307m.
Strategic green investments
MK Fintel Wind – which operates two wind farms in Serbia, with a combined installed capacity of 16.5 MW and is a 46/54 joint venture between Serbian vertically integrated conglomerate MK Group and Italy’s Fintel Energia Group – said it plans to conduct an IPO on the Belgrade Stock Exchange, offering between 20 per cent and 40 per cent of its capital.
MK Fintel Wind has started the construction of its third wind farm and expects to complete its first phase by the end of 2018. The company plans to invest EUR124m in the first phase of the construction of the wind farm, named Kosava, and EUR100m in the second stage of development of the facility, MK Fintel Wind said in a statement.
“MK Fintel Wind will install 20 wind turbines, with a combined capacity of 69 MW, under the first construction phase, while additional 19 units will be installed during the second development stage,” the company’s CEO Tiziano Giovanetti, said.
MK Fintel Wind is carrying out the project with the financial support of Serbian lender AIK Banka, the company noted.
“General Electric (GE) is interested in participating in the construction of Kostolac wind farm by Serbian state-owned power utility EPS. GE believes that it is technically and commercially fit to take part in the project, the company CEO for Southeastern Europe (SEE),” Gaetano Massara, said in an interview for news portal eKapija. “The Serbian renewable energy market is very important for GE. Moreover, the adoption of a regulation framework on renewable energy sources in June 2015 opened the way for the launch of an attractive and sustainable renewable energy market in Serbia,” Massara said.
In 2015, EPS said that the results of a feasibility had shown that it is possible to build a wind farm with 20 turbines and total installed capacity of between 50 MW and 60 MW in the area of Kostolac, in eastern Serbia.
Serbia currently uses only 50 per cent of its hydropower potential and this is also a niche that attracts the interest of GE, Massara added. In February, GE said it plans to complete the modernization of Serbian coal-fired thermal power plant (TPP) Nikola Tesla A this year.
Belgian renewable energy group Elicio plans to put on stream an 8 MW wind farm in Malibunar, in northern Serbia, by the end of 2017. “Serbian companies have already started the construction of the wind farm,” the business development director of Elicio, Nicholas Bruynooghe said during a meeting with energy minister Antic, as quoted in a statement by the government.
Elicio also plans to start shortly the construction of the 42 MW Alibunar wind farm, located close to Malibunar, which will be co-financed by the International Finance Corporation (IFC), Bruynooghe said in the statement. The Belgian company said the investments in Alibunar and Malibunar will stand at EUR72.64m and EUR13.8m, respectively.
In October 2013, the Serbian government said Belgian company Electrawinds received an approval for the construction of a wind farm in Malibunar. Electrawinds was declared insolvent in December 2013 and was subsequently acquired by the Belgian energy, telecommunications and industrial group Nethys, the parent of Elicio.