Balkan Energy Future

Fossil fuel dependency vs. energy efficiency and renewable energy

Balkan countries have the highest energy intensities in Europe, i.e. much more energy is used for the production of a unit of work here than in any European country. Nonetheless, very little investment and priority are given to increasing efficiency, in comparison to the investments going to unsustainable fossil fuel projects, such as thermal plants and pipelines, and to nuclear. The Energy Community of South Eastern Europe (ECSEE) is a process driven by Balkan governments and International Financial Institutions (IFIs), which promotes the development of the Balkans as a source of dirty and "cheap" energy and a transit region for oil and gas from the countries east of the EU.

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Kozloduy Nuclear Power Plant

Location: Kozloduy, Bulgaria

Cost: More than EUR 170 million has been committed to the KIDSF (Kozldouy International Decommissioning Support fund)[67] Capacity: Units 1 and 2: 440 MW (WWER-440 V-230 type); Units 3 and 4: 440 MW (WWER-440 V230 type); Units 5 and 6: 1000 MW (WWER-1000/V-320 type)

Overview: Kozloduy NPP began operation in 1974, with new units coming online in 1975, 1980, 1982, 1988 and 1993. In 1992 a G7 meeting decided that Kozloduy units 1-4 were among the most unsafe in Eastern Europe. After an earlier failed iniative, in 1999 a Memorandum was signed between the EU and Bulgaria in which, among other things, both sides agreed that units 1-2 at Kozloduy must be closed before 2003 and units 3-4 before 2006 (according to the EU) or 2008-2010 (according to the Bulgarian government).

The Kozloduy NPP International Decommissioning Support Fund (KIDSF) was established in June 2001 by the Board of Directors of the EBRD. In 2002 units 1 and 2 were shut down, and units 3 and 4 should be closed before the end of 2006. Meanwhile units 5 and 6 are undergoing upgrading, representing a perpetuation of the nuclear industry in Bulgaria.

Financing: For decommissioning, funds have been provided by the European Community, Austria, Belgium, Denmark, France, Greece, Ireland, the Netherlands, Spain, Switzerland and the United Kingdom.

Upgrading of units 5 and 6 is financially supported (loans) by Euratom, US Exim bank and Russia.

Companies involved: Kozloduy is run by Kozloduy NPP PLC. Modernization of units 5 and 6 is being carried out by "European Consortium – Kozloduy", consisting of Siemens, Framatome and Atomenergoexport, and Westinghouse.[68]

A full list of contractors for the decommissioning of units 1-4 can be found here

Belene Nuclear Power Plant

Location: Belene, Danube, Bulgaria

Cost: EUR 2.7 billion for construction - up to EUR 4 billion including financing costs[40]

Capacity: 2 units, 1000MW each

Overview: The construction of the Belene NPP originally began in 1987, but was discontinued as a result of lacking funds and environmental protests. In 1997 its fate was sealed as the cabinet declared it "technically unsound and economically unviable".[41] However, in 2003 it was revived and has attracted strong opposition, with critics pointing out that Belene lies in an area prone to earthquakes, and that Bulgaria should invest in much-needed energy efficiency and renewable energy instead of in dangerous nuclear power for export.

Financing: Italy's UniCredit, Citibank, Czech Komercni Banka and the US Exim Bank are associated with the Skoda consortium's construction bid. Gazprombank, the financial arm of Gazprom, has shown interest in financially supporting the project as well[42]. A number of Western companies and banks – ENEL (It.)[43], E.ON[44] (Ger.), Commerzbank[45] and Deutsche Bank[46] (Ger.) among others – are also named as being interested participants in the project.

Companies involved: Two consortiums have made bids for the construction of the plant: Russia's Atomstroyexport, France's Framatome, and Germany's Siemens; and and Czech engineering firm Skoda JS, together with Skoda Praha a.s. and the Rez Nuclear Research Institute. Both consortiums contain companies (Atomstroyexport and Skoda JS) which are controlled by Gazprom.[47]

Maritsa East Coal Fired Power Plants

Location: Bulgaria

Cost: Maritsa East I - EUR 1 050 million[54],

Maritsa East II retrofitting: EUR 80 million[55]
Maritsa East III – EUR 648 million[56]

Capacity: Maritsa East I: to be reconstructed with two units of 310 MW (to replace the old 500 MW facility)
Maritsa East II: 1 450 MW
Maritsa East III: 840 MW

Overview: Maritsa East Coal Power Complex, the first unit of which opened in 1950, burns low-quality and highly polluting lignite coal and a 2004 report found that Maritsa II alone was the biggest large point source of sulphur dioxide in the whole of Europe.[57] Although much of the work being done on the plant aims at reducing pollution, the huge Maritsa I project includes an expansion of the plant’s capacity, which will undo some of the gains made.

Financing: Maritsa East I: EBRD, ING Bank, BNP Paribas, and Calyon,[58] Maritsa East II: EBRD, ISPA,[59] JBIC, Bulbank,[60] Maritsa East III: EBRD, Credit Agricole, Societe Generale, Banka Mediocredito, Bank Austria Creditanstalt, Black Sea Trade and Development Bank, Bulbank, United Bulgarian Bank, Biochim and SG Expressbank.[61]

Companies involved: Maritsa East I: AES (US), ENEL, Alstom SA (Fr)[62] Maritsa East II: ME2 (state-owned) Maritsa East III: Maritsa East III Power Company AD, a joint venture between Natsionalna Elektricheska Kompania, Entergy, and later also ENEL.[63]

Cernavoda Nuclear Power Plant

Location: South-eastern Romania

Cost: Cernavoda 2 is expected to cost USD 750 million.

Capacity: Cernavoda 1: 700 MW, Cernavoda 2: 700 MW

Overview: Construction of the Cernavoda nuclear power plant originally began in the early 1980s, but Cernavoda unit 1 was not completed until 1996. In the late 1990s, the Romanian government decided to complete the second reactor despite a lack of funding and the fact that Romania's current electricity production capacity is double the peak load. Romania's consumption could also be much further reduced by pursuing energy efficiency measures. Adding more nuclear capacity also increases existing problems with spent fuel and radioactive waste and increases the risk of accidents. Unit two is expected to be completed by the end of 2006 and the government is currently seeking financing for a third unit, a project which is planned to have little state share.

Financing: Euratom and the Export Credit Agencies (ECAs) of Canada, Italy and USA.

Companies involved: Cernavoda was constructed together with the Canadian company Atomic Energy of Canada Limited (AECL) using CANDU technology. AECL, together with the Italian company Ansaldo is constructing unit 2.[48]

Pan European Oil Pipeline (PEOP)

Location: Constanta (RO) – Pancevo (SiCG) – Omisalj (HR) – Trieste (I)

Cost: $ 2.4 billion[17]

Length: 1295km (or possibly 1856km to Genoa)

Capacity: 60 mt/year

Overview: The Pan-European Oil Pipeline (PEOP), formerly known as the CPOT pipeline would take oil from the Romanian Black Sea coast to refineries in Serbia and Croatia and on to Trieste where it would connect with the existing Trans-Alpine pipeline (TAL) and the Italian pipeline network. The leftover oil would either be shipped from Genoa or added to the TAL pipeline. A Memorandum of Understanding was due to be signed by the relevant governments in March 2006 and a 2005 IFC-funded feasibility study estimated that the pipeline would operate from 2011. The pipeline is promoted as having environmental advantages: it could reduce the number of oil tankers in the tourist-dependent Adriatic Sea by an estimated 200 per year, but on the other hand, the Slovenian and Italian regions through which it passes are named as environmentally sensitive areas, and if oil is shipped from Genoa then there would be around 70 more tankers per year in the Mediterranean.[18] In early 2006 it was proposed to construct a gas pipeline on the same route.[19]

Financing: Financing for the project would be 70% debt, by two Export Credit Agencies (eg. SACF, KfW IPEX, OeKB), two Multilateral Agencies (EBRD, MIGA), and 30% of the 70% would be from private commercial banks.[20] The feasibility study for the project reached the conclusion is that it is feasible, but only with tax breaks which may or may not materialise, which raises the question of whether tax breaks should be given to fossil fuel projects in an era of climate change and rising oil and gas prices.

Companies involved: Serbian energy news bulletin Energy claims to have off-the-record information that US company Chevron is interested in getting involved in the project[21] but this has been neither confirmed nor denied by the company.

Nabucco Gas Pipeline

Location: Turkey, Bulgaria, Romania, Hungary and Austria

Cost: EUR 4.6 billion[26]

Length: 3,400 km

Capacity: by 2020, 25.5-31 bcm/y as it crosses Turkey, with transit countries taking around 12-15 bcm/y, so deliveries to Baumgarten, Austria, would be around 13.5-16 bcm/y.

Overview: The pipeline is designed to carry gas from the Caspian and Middle East to Western European markets. The partners in the project have all agreed to meet at least part of their own domestic demand by means of Nabucco. In 2004, a new Vienna-based venture set up to coordinate the project, the Nabucco Company Pipeline Study GMBH, was established, and in 2005 this was changed to the Nabucco Gas Pipeline International Ltd. The European Commission showed its interest in the project by financing a feasibility study.[27]

Financing: Financing is being sought from the EBRD, EIB and IFC[28]

Companies involved: The Nabucco Gas Pipeline International Ltd consists of Austria's OMV, Turkey's state pipeline company Botas, Hungary's MOL Transmission plc, Bulgaria's Bulgargas and Romania's Transgaz, each holding a 20% stake. France's Total and Gaz de France, Germany's E.ON and RWE, a Polish and a Japanese company are also said to be interested in joining the company, but only two will be accepted and their share of the company would be less than 20%.[29]

Greece-Slovenia (Western Balkan) Gas Pipeline

Location: Not clear, but involving Greece, Albania, Macedonia, Serbia and Montenegro, Bosnia-Herzegovina, Croatia and Slovenia

Cost: Not yet known

Length: Not yet known

Capacity: Not yet known

Overview: An agreement to study the evolution and implementation of a gas pipeline between Greece and Slovenia was signed on 8 April 2003 between DEPA (Greece), Botas (Turkey) and the gas authorities of Macedonia, Albania, Yugoslavia, Bosnia- Herzegovina, Croatia and Slovenia.[37] However, little else is known about the project, which, if it is not extended to join up with a major gas hub, would mainly serve for regional distribution within South East Europe. It is, however, not clear that there is a large enough demand in SEE to support the construction of such a pipeline.[38]

Financing: Not yet known

Companies involved: DEPA, Botas, Makpetrol, NIS-Gas, BH-Gas, Plinacro and Geoplin.[39] Since the project involves Albania, the Albanian Petroleum Corporation (APC) may also be involved.

Turkey-Greece-(Italy) Gas Pipeline

Location: Karacabey (Turkey) - Komotini (Greece), with extension to Otranto (Italy)

Cost: €600m ($721m)[30], with EUR 350m ($ 452 m) for the extension to Italy.[31]

Length: 286km, with an extension of 220km between the southern Italian port of Otranto and a Greek terminal

Capacity: Initially 0.75 bcm/y increasing to 3 bcm/y. With an extension it will be able to carry up to 11 bcm/y.

Overview: On 23 December, 2003, Turkey's state pipeline company Botas signed an agreement with its Greek counterpart, DEPA, concerning the commercial terms for a planned new gas pipeline between the two countries. The plans are at an advanced stage, with the EIA having been approved despite the pipeline passing through two Natura 2000 sites (Filiouri River and South Forestal Cluster of Evros[32]). The pipeline is due to be completed in 2009.[33]

In April 2005 DEPA and Edison signed a provisional deal to build the extension under the Ionian Sea, which was backed up by the signing of a Greece-Italy intergovernmental agreement on 4th November 2005.

Financing: The EIB has approved EUR 22 m of financing for the Greek section of the Turkey-Greece project.[34] Costs for the extension are to be shared equally between DEPA and Edison.[35]

Companies involved: Botas (Turkey) and DEPA (Greece). In February 2006 Gazprom expressed interest in getting involved.[36] For work on the extension, a joint venture called Poseidon is being formed.

Thessaloniki-Skopje oil pipeline

Location: Greece - Macedonia

Cost: EUR 123 million[64]

Capacity: 2.5 mt/y

Length: 210km

Overview: Construction of the Thessaloniki-Skopje pipeline, to bring oil to the Okta refinery in Skopje, began in early 2000, though its Environmental Impact Assessment was released only in October 2000 - unfortunately too late for its recommendation to re-route the pipeline to avoid disrupting the habitat of the rare Imperial Eagle. The pipeline also caused controversy after its completion, when the Macedonian government was not able to collect revenues from the project, or even see the annual balance sheet. The Greek partners claimed that the results were negative and that there was therefore no profit to share, whilst the Macedonian media suspected that negative results were being reported deliberately to avoid sharing the revenue.[65]

Financing: EBRD

Companies involved: Hellenic Petroleum, Aegek, Macedonian Government

Burgas-Vlore (AMBO) Oil Pipeline

Location: Burgas (BG) – Macedonia (MK) – Vlore (AL)

Cost: The project is estimated to cost $1.2 billion[1]

Length: 913km

Capacity: 37.5 mt/y (750,000 b/d) with possible expansion to 50 mt/y (1.0 mb/d)[2]

Overview: The Burgas-Vlore pipeline, often known as AMBO (after the US-registered Albania-Macedonia-Bulgaria Oil corporation) has been under development for more than ten years. In 2002 a US-funded feasibility study was completed and in December 2004 a Memorandum of Understanding was signed by the relevant governments. The project's strength is that it serves an existing deepwater port, Vlore in Albania, but Vlore is also Albania's main coastal resort and the project has faced fierce opposition there. If the project moves forward, construction is expected to take three years[3]

Financing: In December 2004 it was announced that USD 900 million of financing for the pipeline had already been secured from the Overseas Private Investment Corporation - the US development agency - the Eximbank and Credit Suisse First Boston, among others[4]

Companies involved: The AMBO Pipeline Corporation, based in New York, has been established with exclusive rights to develop the project.

Burgas-Alexandroupolis Oil Pipeline

Location: Burgas (BG) Alexandroupolis (GR)

Cost: $700 million[5]

Length: 286km

Capacity: 30-40 mt/y (600,000-800,000 b/d)

Overview: The Russian-backed Burgas-Alexandroupolis had stalled for several years and suffered from speculation about Russian unwillingness to proceed with the project. In April 2005 the project was resurrected when a Memorandum of Understanding was signed between the Bulgarian, Greek and Russian governments. The project has the advantage of passing through only two states, and of being relatively less costly than other proposals but the disadvantage of carrying oil in tankers in the Black Sea and Aegean Sea. The Black Sea represents a very vulnerable marine area which is already very much polluted, while the Aegean Sea contains numerous submerged rocks and island populations dependent on tourism and fishing. Critics also point out that Alexandroupolis cannot currently handle large enough tankers due to international turning circle regulations and would need expansion.

Financing: It is not known whether any funding has been secured for this project yet. Some observers have stated that the project would be completed solely with private capital,[6] whereas the Greek Deputy Minister of Development stated that Greece had requested a European Union subsidy for the pipeline of 100 million euros at a Meeting of the European Council[7]. This was not mentioned in the minutes of the meeting, however[8].

Companies involved: The companies which have been named in association with the project are named below. However it is not likely that all of them will finally participate.

Russia: Initiators: TNK-BP, Stroitransgaz, Sovcomflot, Tatneft

Observers: Rosneft, Surgutneftegas,[9]

Transneft and LUKoil have also been mentioned in connection with the project. Sibneft is reported to have committed to use the pipeline for transporting its oil.[10]

Greece: Hellenic Petroleum, the Latsis and Kopelouzos Groups and Prometheus Gas (half-owned by Gazprom, half-owned by Kopelouzos)[11] have formed a consortium called DEP-Thraki.[12]

Bulgaria: There are two Bulgarian consortiums: Universal Terminal Bourgas (Technoexportstroi and Frontier[13]) and Transbalkan Oil Pipeline Bulgaria (MG Energy and Natural Resources, LUKoil Bulgaria, Monolit 3, Industrial Holding Bulgaria, KZU and Magnum 07)[14]. Glavbolgarstroy, Gasstroy-montaj, Holicon, Interneft-gasmontazhi, Chimremontstroy and Minstroy Holding have also been named in association with the project[15]

An international project company was due to be set up at the end of 2005[16]

Druzhba-Adria Integration

Location: The existing Adria pipeline runs from the port of Omisalj, through Croatia and Hungary, and would be intergrated with the existing Southern Druzhba pipeline, running from Samara in Russia, through Belarus, Ukraine, Slovakia, and Hungary.

Cost: $300 million[22], with around $20m for the reversal of the Adria pipeline and the rest for the upgrade of the remaining pipeline.

Length: No new pipeline would be built but the existing ones total 3200km

Capacity: The capacity would gradually increase from 5 to 15 mt/year[23] (100 000 – 300 000 bpd)

Overview: The project involves the reversal of the Adria pipeline, which extends between Croatia's port of Omisalj on the Adriatic Sea and Hungary. The pipeline, which was completed in 1974, was originally designed to load Middle Eastern oil at Omisalj, then pipe it northward to Yugoslavia and on to Hungary. However, given the Adria pipeline's existing interconnection with the Russian system, the pipeline's operators and transit states have since considered reversing the pipeline's flow, thus giving Russia a new export outlet on the Adriatic Sea.

In December 2002, the six countries signed a preliminary agreement on the project. Since then, however, the project has come to a standstill after an unprecedented campaign from Croatian civil society groups. They argue that the reversal of the pipeline and subsequent increase in tanker traffic in the Adriatic Sea is a risk not worth taking, since tourism brings in much more income for Croatia than the pipeline ever would, and that an oil spill in the shallow and enclosed Adriatic would take decades to recover from. In addition the problem of ballast water discharge into the Adriatic has not been addressed. In October 2005 the EIA was rejected for the third time and since then the project has apparently been shelved.

Financing: In 2000 Yukos and Janaf signed a contract for the reversal of the Adria pipeline, in which Yukos was to invest $20 million[24] However the financing for the upgrading of the other pipelines is unknown.

Companies involved: Transneft (Russia), Gomeltransneft-Druzhba (Belarus), MOL (Hungary), Transpetrol (Slovakia), Ukrtransnafta (Ukraine), and JANAF (Croatia). In 2002 it was reported that Yukos and Tyumen (now TNK-BP) (Russia) had both committed to supply 2.5 mt/y through the pipeline[25]

Podgorica Aluminium Complex/Kombinat Aluminijuma Podgorica (KAP)

Location: Podgorica, Montenegro, Serbia and Montenegro

Overview: The KAP, opened in 1971, accounts for 62% of Montenegro's export earnings and represents 13% of its GDP. On the other hand it has nearly USD 120 million of debt and consumes 43% of all the electricity in the country[51]. Keeping the plant supplied with electricity is therefore a major issue for Montenegro, and was a motivating factor for the Buk Bijela dam project that would have flooded part of the UNESCO-protected Tara Canyon.

In 2005 65% of the company was acquired by Salomon, a subsidiary of Basic Element.[52] Critics of the sell-off were particularly concerned about the proposal to allow the plant to continue receiving subsidised electricity for five years, claiming that it would cost Montenegrin taxpayers a minimum of USD 61 million during that time. They also claim that the deal will not guarantee environmental improvements and may lead to increased pollution.[53]

Financing: Salomon is obliged to invest EUR 55m in modernization of KAP and to pay off its debts.

Companies involved: Salomon, a subsidiary of Basic Element. However, most of the process was carried out by Rusal, which is owned by Basic Element.

Plomin III Coal Fired Power Plant

Location: Plomin, Istria, Croatia

Cost: Not yet known

Capacity: Plomin 3 is planned to increase the plant's capacity from 330 with an additional 500 MW

Overview: Plomin has had a coal-fired power plant since 1969, and a second highly controversial unit was completed in 2000.49 In late 2005 plans for a new unit, Plomin 3, attracted immediate criticism from environmentalists who argue that investments should be targeted at energy efficiency and renewables rather than fossil fuels.

Financing: Not yet known

Companies involved: Hrvatska Elektroprivreda (HEP), with TE Plomin 2 owned by TE Plomin d.o.o., a mixed company owned 50% by RWE Power and 50 % by HEP d.d.50

Erdut/Prevlaka NPP

Location: Not yet decided - either Erdut on the Croatian/Serbian border or Prevlaka between Velika Gorica and Ivanic Grad, only 30km south-east of Zagreb.

Cost: Not yet known

Capacity: Not yet known

Overview: A nuclear power plant was planned in Prevlaka during the 1980s, but after the Chernobyl catastrophe it was removed from local spatial plans. In February 2006 it was announced that Croatia is again considering building a nuclear power plant, which would be the first on its territory, although it half-owns the Krsko NPP in Slovenia.

Financing: Not yet known

Companies involved: Not yet known


Small hydro: The total potential energy capacity of small hydro sources is 177 MW.

Biomass: In 2001, bio-energy accounted for 3.3% of the total energy supply of Croatia and the total energy potential of biomass is 39 PJ.

Wind: Several studies indicate that the Croatian islands and the Adriatic coast are good locations for wind energy. According to the ENWIND National Energy Programme the total energy potential of wind is 209 MW on the islands, while it is 163 MW on the Adriatic coast.

Solar: According to the SUNEN National Energy Programme, the total energy potential of solar energy is 100 PJ.

Geothermal: Croatia has geothermal reservoirs in the northern part of the country, characterized by high value geothermal gradients. In 2000, the total installed capacity was 36.7 MWt and the total potential is estimated at 839 MWt.

The only IFI to invest in energy efficiency in Croatia so far has been the World Bank (IBRD and GEF). A USD 39.3 million project was approved in 2003, including a USD 5 million from the IBRD and a USD 7 million grant from the GEF.


Biomass: Bosnia-Herzegovina has great potential, as the energy output is estimated at approximately 1 million m3 per year.

Solar: With regard to solar irradiation, Bosnia and Herzegovina can be counted among the more favourable locations in Europe with solar irradiation figures of 1 240 kWh/m2/yr in the north of the country and up to 1 600 kWh/m2/yr in the south. There is a great potential for Bosnia-Herzegovina to combine the two energies in establishing a unique central system from biomass heating plants and solar systems.

Geothermal: As many of the cities currently use combustion of crude oil for heating, serious damage to the environment could be avoided by introducing geothermal heating, as in Laktasi Spa and Dvorovi Spa.

Small hydro: On one hand, Bosnia-Herzegovina has a huge potential of 2500 GWh for small hydro power plants. On the other hand, the potential of large hydro power plants is impressive and there are big plans for the construction of several large HPPs. However, large HPPs cannot be categorized as "renewable" due to the fact that they have serious negative environmental and social impacts, increase vulnerability to climate change and significantly crowd out funding for other renewable sources[66].

In Bosnia-Herzegovina there have been no renewable energy projects financed by the IFIs.

Serbia and Montenegro

Wind: In average wind speed zones, Serbia and Montenegro has a wind capacity (onshore and offshore) of 26.3 TWh/yr.

Solar: 28 000 solar thermal units have replaced the equivalent of 0.14 TWh of fossil fuels. The total potential for solar active technologies is approximately 50-60 percent of the heating demand in the central regions.

Geothermal: In Serbia there are more than 60 geothermal systems with temperatures lower than 150 oC. The estimated energy reserves of geothermal resources are around 800 MWh.

Biomass: It has been estimated that 200 ktoe of conventional transport fuel could be saved each year through methanol production from crops grown only on 3% of the total arable land. And another 260 ktoe/yr is considered available from agricultural wastes but few applications exist at the present time.

Small hydro: Serbia has 39 small hydro power plants with the installed capacity of 49 MW. There are 856 potential sites for small hydro power plants with a capacity of up to 10 MW.

In Serbia and Montenegro, there have been no renewable energy projects financed by IFIs.


Geothermal: Macedonia has a history of using geothermal energy for heating purposes. The potential for geothermal energy production is estimated at 210 000 MWh per year. Currently there are more than 14 geothermal sites used for heating green houses.

Small hydro: There are more than 400 potential small hydro sites with small hydro plants from 45 kW up to 5000 kW. Therefore the overall potential is 225 MW in capacity and 1100 GWh in terms of annual energy production.

Wind: There are no wind turbines for energy production installed in Macedonia. However, the potential for energy production using wind power is estimated to be very favorable, especially in the central part of the country.

Biomass: The technical potential of biomass (energy resource from forests, agricultural residues and municipal waste) is estimated at 3361 GWh.

Solar: As one of the sunniest countries in the region, Macedonia has an annual solar energy value of 10 GWh.

In Macedonia, in 1999 the World Bank initiated the preparation of the Programme on small hydro plants through the Mini Hydro Power Plant project. Together with the GEF (the Global Environmental Facility) the WB provided funds for the co-financing of 5 small HPPs with a capacity of 1.37 MW and electricity production of 11000 MWh.


Wind: Among the Balkan countries, Bulgaria has the highest wind power potential (3400 MWe in 2020).

Small hydro: According to the Black and Veatch Corporation study (2003)67, the mid-term potential of small hydro in Bulgaria is 1070 MWE. The energy generated from small HPPs is 63 MWE.

Biomass: Currently, biomass accounts for 3.7% of the calculated total consumption and the potential of biomass is estimated at 3371 MWE (mid-term).

Solar: The annual mean radiation for Bulgaria is 4.2 kWh/m2/day. The solar energy potential is estimated at 8169 Mtoe. 10 000 m2 of solar collectors installed in 1977-1990 along the Black Sea Coast are still operating

Geothermal: About 30% of the country's geothermal potential is being used for space heating, greenhouses, drinking water and for balneology and the potential of geothermal energy is estimated at 200 MWE.

The total potential of renewable energy sources according the above-mentioned study amounts to 8041 MWE.

In Bulgaria, the IFIs have invested mainly in large scale energy projects. The EBRD and World Bank have set up a special credit line in order to support the Energy Efficiency Fund.


Wind: The estimated economic potential of wind energy in Romania is 14,000 MW (and the wind potential on the Black Sea coast is approximately 4500 GWh/year). The country has two wind installations connected to the grid.

Solar: Solar energy projects have been implemented since the 1980s. The average solar radiation is around 1400 kWh/m2 per year. Romania is planning the installation of 2.6 million square metres of collectors with the capacity to produce 1000 GWh thermal energy per year.

Geothermal: The total installed capacity of geothermal systems is 320 MWt, but currently 137 MWt are being used (with a temperature range of 55-115 oC. Theoretically, Romania has the third highest geothermal potential in Europe.

Biomass: The biomass potential is assessed at 7594 thousand TOE/year (19 percent of the total primary energy consumption in 2000). There have been several biomass projects in Romania and the total capacity is said to be 1242.4 MWt and 0.2 MWe.

Small hydro: The micro hydro potential (HPPs with capacities under 0.63 MW) is 757 MW (2940 GWh/year). Approximately 5 000 locations have been identified as suitable for small hydro (<10 MW) applications.

In Romania, since the early 80s, the World Bank has been financing large HPPs (rehabilitation of one and two new constructions), which cannot be truly considered to be renewable energy. The rest of the IFIs have not touched renewable energy projects in Romania at all.

The Balkan countries' preoccupation with fossil projects is shortsighted considering the global rise in oil and gas prices and the relative lack of new discoveries of fossil fuel reserves, and it leaves little room for investment in sustainable EE/RE projects.

Balkan countries have high potential for developing energy production from renewable energy sources: sun, water, wind, biomass, and geothermal energy. However, these potentials are not studied and exploited enough.

The implementation of small scale energy efficiency and renewable energy projects can bring greater benefit to local communities and small businesses. It is much more labour-intensive and can create new services in the local economy and increase employment, while decreasing inefficiency and dependency on costly resources from far away. Moreover, energy efficiency unequivocally leads to improved industrial environmental performance (by changing industrial processes) and reduced pollution from energy generation (by decreased energy consumption) with positive social and health impacts

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