North Macedonia relies predominantly on fossil fuels (low-grade lignite and gas) and hydropower, and is dependent on electricity imports. The total annual production of electricity in 2018 was 5,447 GWh, and another 2,297 GWh was imported to satisfy the total domestic electricity demand.
Electricity generation North Macedonia in MWh, 2018
Source: ГОДИШЕН ИЗВЕШТАЈ 2018
The electric power generation capacity in North Macedonia in 2018 mainly consisted of two thermal power plants with a total of 800 MW installed capacity, eight large hydropower plants with 586.65 MW installed capacity, 96 small hydropower plants with 106,32 MW installed capacity and three CHP plants with 287 MW installed capacity.
In January 2020 the government adopted the new Energy Development Strategy 2020-2040 which elaborates three different scenarios: reference (business as usual), moderate transition and green (strong decarbonisation) scenarios. The moderate transition and green scenarios both foresee coal phase-out in 2025 which makes it the first country in the Western Balkans to layout concrete options for a pre-2030 coal phase-out. The final decision on which scenario will be implemented will be made later in 2020, but considering that the strategy sees the green scenario as the least cost option it is likely that the country will move away from coal sooner rather than later.
The smaller thermal power plant REK Oslomej is operating occasionally during winter months. Discussions about “urgent need for modernization of the obsolete equipment” have been going on for years now, but according to the Energy Strategy it is phased out in all three scenarios. Its capacity will be replaced by a 120 MW PV plant on top of the now depleted lignite mine.
In the moderate transition and green scenarios in the Strategy, phase out of the РЕК Bitola lignite-fired power plant in 2025 is also recommended. In the reference scenario investments for modernization and pollution control are given instead of phase out.
There are two operational open cast lignite mines – Suvudol and Brod-Gneotino. The total reserves stand at about 75 million tonnes and estimated deposits for the next 15 years. According to the state owned electricity production company 5-year investment plan 2018-2022, the commissioning of a new Zivojno mine could extend the coal supply to TPP Bitola for another ~10.6 years. However, this new mine would involve underground operations, with which the country has no experience to date. Also, an increase in the price of such locally-sourced lignite is anticipated due to the higher cost of coal production in the new mines and transport over longer distances and on rough terrain.
Domestic production of electricity has been stable in the past 5 years and imports have stayed at around 30 percent of total consumption. This percentage does not include the import of natural gas for energy transformation.
Natural gas is imported from Russia through a single entry point at the Bulgarian border. Gas is mainly consumed by industrial customers and the three CHP plants, while households have an almost negligible share of total consumption due to the very limited spread of distribution networks.
Under Energy Community commitments to increase the share of renewable energy in its mix, North Macedonia had a target of 28% in gross final energy consumption in 2020. In April 2017 North Macedonia amended its National Renewable Energy Action Plan submitted to the Energy Community in 2012, to take into account lower biomass baseline data (17.2% compared to the 21.2% originally). Based on the revised biomass statistics, the 2020 target for the share of renewable energy sources in gross final energy consumption was changed from 28% to 23%. The Energy Community’s Ministerial Council adopted a decision approving this revision in November 2018.
In spite of the incomplete legal framework for renewables, several renewable energy projects have become operational in recent years contributing to an increasing share of energy from renewable sources in the energy mix each year.
North Macedonia has a 36.8 MW wind farm at Bogdanci and has been reported to be moving forward with expanding it, but there hasn’t been a lot of movement lately. It was the first country in the Western Balkan region to put into operation a sizeable wind facility. There are also two more wind farms that should be built in the next 5 years since they already have most of the permitting process done, which should bring total wind installed capacity to around 86 MW.
Solar PV capacity has been stagnating for the last 5 years as annual production remains the same at around 23 GWh. Solar potential is hardly tapped, but with the latest tenders for the Oslomej PV and the feed-in premium auctions, installed capacity will increase significantly.
|Installed PV Capacity 2016 (MW)||Installed PV Capacity 2018 (MW)||Installed Wind Capacity 2016 (MW)||Installed Wind capacity 2018 (MW)|
Like other countries in the region, North Macedonia has big plans for hydropower. The Energy Development Strategy recommends a total of 998 MW new hydro capacity to be added until 2040 in all scenarios.
Regarding hydropower, around 80 small hydropower plants have gone online since 2010, and although there have been some breaks, the hydropower boom is very much ongoing with a new tender for 21 locations published in 2019. In 2017 and 2018, 8 and 4 small hydropower plants went online respectively. What is characteristic for North Macedonia is that it still features the largest number of greenfield plants financed by the EBRD in the Western Balkans (20 plants, 15 directly and five through intermediaries).
North Macedonia has plenty of room for energy efficiency improvements. Electricity losses in the grid range from 14 to 16 percent of the gross national electricity consumption, and practices such as heating on electricity have contributed to increasing energy costs for many households.
More on coal in the Balkans
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Despite this deadly legacy, just two years ago, all the Western Balkan countries except Albania still planned to build new coal power plants. Since then, three out of five have abandoned these plans. The region has split, creating a two-speed energy transition.
ContourGlobal is quitting the planned 500 MW Kosova e Re lignite power plant project in Kosovo. The company stated that it is now impossible for the project to meet the required milestones, citing, among others, the recent formation of a government led by a Prime Minister publicly opposed to the project.