N. Macedonia to introduce internal CO2 pricing by 2024

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N. Macedonia to introduce internal CO2 pricing by 2024 – minister

Date: May 19^th 2022

Author: Maja Žuvela

Category: En.vision

Topic: Electricity , Coal , Energy policy , CO2 emissions , Economy , Ecology

North Macedonia aims to implement an internal mechanism to price carbon emissions next year or in 2024 at the latest, its environment and physical planning minister Naser Nuredini said on Wednesday.

“We are preparing a new law on climate change, and we are looking to introduce carbon pricing into our new law, a transitional one, which we will hopefully try to align with the EU carbon pricing methodology by 2030,” Nuredini said at an event on the future of carbon border adjustment mechanism (CBAM), organised by the Energy Community in Brussels.

Nuredini said that the Western Balkan country, which produces 65 to 75% of its electricity from coal, intends to decrease greenhouse gas emissions by 51% and shift away from coal by 2030.

The World Bank told Montel in early May that North Macedonia’s plans to accelerate its coal phase-out and harvest more energy from renewables could be negatively impacted by the ongoing energy crisis.

The energy crisis, which began in mid-2021, and the ongoing war in Ukraine have already caused the government to delay its coal phase-out deadline from 2027 to 2030 and even open new coal mines to feed the country’s power plants.

“It [the coal phase-out] is not something we can do easily, and it is unfortunately very costly. What Western Europe has been doing for decades we are trying to do in a shorter time frame,” said Nuredini.

Carbon leakage

Thomas Waitz, a member of the European parliament, told the same gathering that a failure to limit or price CO₂ emissions of products imported into the EU would create huge carbon leakage in the bloc's system. CBAM will only apply to countries which are not pricing CO₂ in a manner comparable to the EU, he said.

Waitz pointed out that due to the energy crisis, a large portion of the electricity generated by 18 Western Balkan coal-fired power plants is currently being exported to the EU. Those coal-fired plants are the biggest polluters in Europe, responsible for thousands of premature deaths a year, he said.

“So, where should the motivation for participating countries to change their power generation come from if it is so profitable now?“ he asked.

Waitz emphasised that it is in the EU’s own interest to invest as much as possible in the region so it could change its energy production models.

“What I am advocating for is that we use CBAM as a regulating instrument to foster the change towards renewable energy in the region while we use the revenues from CBAM to refuel the economies of the Western Balkans and support the region to actually make the transition,” said Waitz.

Meanwhile, the European Parliament’s environment committee has called for the CBAM to be enforced in a pilot form from 1 January 2023, with free allowances for the sectors it covers being phased out from 2025.