N. Macedonia to spend EUR 3bn on coal phase-out by 2030

Date: December 4^th 2023

Topic: Electricity , Renewables , Energy policy , CO2 emissions , Economy

North Macedonia plans to invest EUR 3bn in the build-out of 1.7 GW of renewables over the next seven years with the aim of phasing out coal by 2030, its energy minister said on Sunday.

To help it guide this plan, North Macedonia’s energy minister Kreshnik Bekteshi launched a just energy transition investment platform during the COP28 conference in Dubai. The platform should bring together the government, international finance and the private sector.

“North Macedonia has set a goal to reduce greenhouse gas emissions by 82% in comparison to 1990 levels by 2030,” Bekteshi said in a press statement.

For the Western Balkan country to achieve this climate objective, EUR 2bn will need to come from private investors and EUR 285m from international donors, the minister added.

The government has promised to update its laws to attract private sector financing by unlocking market barriers via competitive auctions.

Switch to gas

The European Bank for Reconstruction and Development (EBRD) has already backed North Macedonia’s new plan.

“The platform represents a milestone for the historically coal-dependent country and highlights its ambition to transform its energy sector and economy to a low-carbon, low-cost and secure paradigm,” the EBRD said in a statement on Sunday.

The new plan not only foresees new renewables installations but also grid and storage investments and just transition measures for people and communities that will be affected by the coal phase-out.

Other international donors and lenders, such as the EU, World Bank, International Finance Corporation (IFC), European Investment Bank (EIB), and KFW, have also pledged support for North Macedonia’s plans.

With over 40% of its power generated from coal, North Macedonia had initially planned to stop using this fossil fuel by 2027. However, the energy crisis that started in 2021 forced the small country to abandon its plans and even open two new lignite mines.

North Macedonia has two coal power plants: the 699 MW Bitola and 125 MW Oslomej. The government is now making plans to switch some coal-fired units to the use of natural gas.