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Serbia plans to stop using coal, fuel oil in district heating by 2040

By 2040, Serbia intends to replace fuel oil and coal in district heating plants with solar, wood biomass, heat pumps, municipal waste and geothermal energy.

Maja Vukadinović, acting Assistant Minister of Mining and Energy for Energy Efficiency and Climate Change, has said that the goal for the district heating sector is to phase out fuel oil and coal by 2040.

She explained that the idea is to replace fossil fuels with solar energy, wood biomass, heat pumps, municipal waste and geothermal energy.

“The list of programs and projects until 2028 is defined in the draft Program for the Implementation of the Energy Development Strategy of the Republic of Serbia until 2040 with projections to 2050, for the period from 2026 to 2028,” Vukadinović told Balkan Green Energy News.

The share of renewables should increase from 2.4% to 5.5%

According to the draft, implementation of decarbonization projects in district heating systems by 2028 should lift the share of renewable energy sources in heat production from 2.4% to 5.5%.

The fuel mix in 2023 was 75% natural gas, 8% petroleum products, 2% coal, 2% wood biomass, and 13% purchased heat. The structure of purchased heat production is 46.8% natural gas, 48.8% coal, 3.3% wood biomass, and 1.1% fuel oil.

serbia decarbonization district heating mix 2040

Natural gas will remain the dominant source of thermal energy, as it is today, although its share is expected to decrease from 73% to 50% by 2040, according to Vukadinović.

The decarbonization of the district heating system would reduce air pollution in cities, especially where coal or fuel oil is currently used, the ministry added.

A strategic plan for the district heating decarbonization policy is being prepared

“It’s very important that the fuels conversion is carried out in parallel with energy renovation of buildings and a reduction of the energy consumption for heating. It would significantly improve living conditions,” Vukadinović underlined.

Decarbonization would also have to lead to the improvement of the overall operation of the heating plants, as well as a reduction in network losses, the modernization of substations, and the introduction of daily and seasonal thermal energy storage, in her opinion. The operation of the district heating systems should depend less on the price volatility of imported fuels, Vukadinović stressed.

Serbia is preparing a strategic plan for the district heating decarbonization policy. The document is under development in cooperation with the European Bank for Reconstruction and Development (EBRD) and the business association of Serbian heating plants, Toplane Srbije.

The document, she explained, will outline steps to improve the district heating system, including the rollout of thermal energy storage, heat pumps, and heat production from waste, as well as the development of the country’s first district cooling systems.

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Romania preparing EUR 300 million in subsidies for geothermal heating, cooling

The Romanian Government has drafted a state aid mechanism for the production and transport of geothermal energy for district heating or cooling systems. The proposed scheme would be worth EUR 300 million, sourced from the European Union’s Modernisation Fund.

In addition to solar and wind energy, hydropower and battery energy storage systems, Romania is increasingly counting on geothermal potential for its energy transition and decarbonization efforts. The government in Bucharest is preparing EUR 300 million in subsidies for geothermal district heating or cooling systems, Profit.ro reported.

It drafted a state aid package that would be covered from the Modernisation Fund. It is a tool for supporting investments in renewables, energy efficiency, storage and networks and a just transition in 13 European Union member states with lower incomes. The funds are from the proceeds of the sales of greenhouse gas emission certificates within the EU Emissions Trading System (EU ETS).

The proposed subsidies are aimed at the production and transport of heat from geothermal energy, including modernization projects, to the points of connection with the district heating network, according to the document.

No need for auction as budget is sufficient for all mature projects

The budget would be divided into EUR 50 million per year through 2030. The funds are intended to cover the net additional costs of the projects – funding gaps. Typically, they are determined as the difference between the net present value of the factual scenario and the counterfactual scenario over the life of the project, the update reveals.

The government estimated that nine projects would split the available funds

There would be nine beneficiary projects, translating to EUR 33.3 million each, the government estimated. Eligible are thermal energy producers and municipal authorities and their units.

There won’t be a competitive bidding process for allocating the state aid, as the Ministry of Energy received too few mature proposals since 2023, within its exploratory public call, the document adds. The government has concluded the budget would cover the potential demand.

Bucharest, Timișoara among potential beneficiaries

State-owned Electrocentrale București (ELCEN), which produces thermal energy for the district heating system in the capital Bucharest, and National Company Bucharest Airports (CNAB), are among the entities interested in the subsidies.

Bucharest’s Sector 1 administrative authority and the Municipality of Timișoara are in the group as well. The latter, Romania’s fifth-largest city, established cooperation last year with OMV Petrom for district geothermal heating.

The article noted that Green Tech International, listed on the Bucharest Stock Exchange (BSE or BVB), is on the list. It operates geothermal wells in Călimănești-Căciulata in the country’s south. The company also supplies heat and sanitary hot water in Nădlac in Arad county in the northwest.

One other company interested in the state aid scheme is Transgex. The city of Oradea, where it is based, inaugurated an 18 MW geothermal district heating plant two months ago.

The government recently launched a EUR 56 million grant program for municipal authorities for geothermal energy projects.

In other relevant news from Southeastern Europe, Slovenia launched a EUR 51.2 million cofunding package for green district heating and cooling ten days ago, for companies and cooperatives.

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Slovenia kicks off grants program for renewables-based district heating, cooling

The Ministry of the Environment, Climate and Energy of Slovenia launched a public call for cofunding the construction or restructuring of district heating and cooling systems using renewable energy sources. The grants, for companies and cooperatives, are from the European Union’s cohesion support mechanisms.

The introduction of renewables-based district heating and cooling systems reduces pollution, greenhouse gas emissions and the dependence on fossil fuels. Much of the European household and business sectors still rely on gas boilers for heating. In addition, the ever-increasing severity and length of heat waves are prompting the need for a systemic cooling solution.

As part of its decarbonization and energy efficiency efforts, Slovenia launched a EUR 51.2 million cofunding package for companies and cooperatives.

The program covers the construction or restructuring of district heating and cooling systems using renewable energy sources. The first deadline for applications is September 11, followed by one on January 8, the Ministry of the Environment, Climate and Energy said.

The public call will be open until the entire sum is allocated, or at the latest until September 11, 2026, the third deadline. The EU’s cohesion funding accounts for 85% and Slovenia is providing the rest.

District heating projects that include cooling get additional points

While primarily aimed at increasing the production of electricity and heat from renewable energy sources and from waste heat, the scheme includes additional points for projects that involve cooling. The systems are required to cover at least 350 kW of consumption.

Eligible equipment includes heat pumps, solar collectors, wood biomass boilers and combined heat and power (CHP or cogeneration) solutions.

Large companies can receive up to 45% of their investment, while mid-sized ones can get 55%. The cap for small and micro enterprises is 65%. The maximum individual grant is EUR 30 million.

Slovenia’s current calls for subsidizing sustainable mobility, energy efficiency and renewables projects are worth more than EUR 300 million altogether. The government is preparing four more, for EUR 62 million overall.

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Serbia shelves plan for strategic partnership for 1 GW in wind farms

Serbia has revised its Baselines of the Energy Infrastructure Development Plan and Energy Efficiency Measures for the period up to 2028, with projections up to 2030. It defines priority projects in the energy sector.

The Baselines of the Energy Infrastructure Development Plan and Energy Efficiency Measures were adopted in mid-2023 at the proposal of the Ministry of Mining and Energy. In the new document, the construction of 1 GW wind farms is no longer among the priority projects. The plan was to involve with a strategic partner, similar to the project for 1 GW of solar power plants, which is currently being developed by state-owned power utility Elektroprivreda Srbije (EPS) with a strategic partner.

The development plan serves as a basis for the implementation of Serbia’s Energy Development Strategy and the National Energy and Climate Plan (NECP).

The ministry outlined projects across six sectors

The investment cycle planned for the upcoming strategic period represents the backbone of the Energy Development Strategy. It provides the foundation for further assessments and projections of the targeted energy mix through 2030 and 2050. It aligns with the international commitments undertaken in the process of European Union accession as well as with the obligations within the Energy Community, the document reads.

The plan includes projects in six sectors: electricity generation, transmission network, distribution network, natural gas, oil and petroleum products, and energy efficiency. It ranks the projects within each sector.

The most significant change in renewable energy is that the construction of wind farms with a combined capacity of 1 GW is no longer on the list of priority projects.

Solar power plants Kolubara and Morava on the priority list

The 1 GW of solar power and the Kostolac wind farm remained among the four most important endeavors, while the new items are the Morava and Kolubara photovoltaic projects. The Klenovnik solar power plant has been removed from the list. According to the document, the projects on the list are the most advanced.

In total, EPS has 41 projects for power generation or 20 less than in the original document.

Fewer projects, but more realistic

The authors explained that the number of renewable energy projects is lower, but more realistic and better optimized. The entire EPS investment portfolio across all areas requires significant funds and loans, so it would not be realistic to pursue a larger number of high-value projects that cannot be financially or physically implemented within a reasonable timeframe, the document underlined.

It was also taken into account that many private projects, mainly wind farms, are being developed through the auction system, so the focus of EPS’s projects is primarily on solar power plants, to create a balanced ratio between wind and solar power plants in the system. The company’s project for the wind farms with a strategic partner remained a backup option, in case an additional capacity is needed, according to the document.

There are new items on the list for the electricity distribution network

There were no changes in the transmission network segment. The priority projects are the third and fourth sections of the Trans-Balkan Corridor, the Pannonian Corridor, and Beogrid 2025. The list contains 66 investments, five fewer than in the original plan.

Changes have been made regarding investments in the power distribution network. The most important projects now are the 110/10 kV substations National Stadium and Surčin. Automation of the medium-voltage network was kept, together with the ongoing replacement of wooden poles with concrete ones and the replacement of electricity meters with smart ones.

The integrated system for remote monitoring, diagnostics, and control of the low-voltage distribution network has been removed from the list. Instead of replacing transformers at 10 kV, 20 kV, 35 kV, and 110 kV voltage levels, the new focus is on the reconstruction of 25 substations of 110/35 kV.

Planning the first district cooling systems

The energy efficiency part of the baselines was changed the most.

The previous document was primarily focused on reviewing and securing financial support for ongoing projects, while the current one is envisaging expanding the scope and considering new financial mechanisms and sectors that require additional support.

Among other initiatives, the Strategic Plan for the Decarbonization Policy of the District Heating and Cooling Sector in the Republic of Serbia is being prepared. It is a joint endeavour of the European Bank for Reconstruction and Development (EBRD), the Association of Serbian Heating Plants, and the Ministry of Mining and Energy.

The project aims to define steps to improve the district heating system, including heat storage, the use of heat pumps, utilization of heat generated from waste treatment, and the development of the first district cooling systems, according to the document.

Special attention will be devoted to developing guidelines for expanding the district heating system by connecting new users while simultaneously shutting down fossil fuel boilers. It will directly contribute to reducing CO2 emissions and pollution, the authors noted.

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Ember: Warming’s 2024 share of global power demand rise was covered with fossil fuels

According to Ember’s new figures, renewable energy sources met almost three quarters of last year’s increase in the world’s electricity demand. Together with nuclear energy, they would have covered almost the entire jump if it wasn’t for the share attributed to the annual increase in temperatures. Looking at it the other way around, the need for additional cooling accounted for the overwhelming part of the rise in fossil fuel use, and at the same time the resulting additional emissions contributed to the acceleration of global warming.

The share of low-carbon sources rose to a historic 40.9% of global output in 2024. Photovoltaics made up 55.2% of renewable electricity production growth. Hungary, Greece and Bulgaria are among the world’s strongest solar power producers while Turkey has one of the highest power demand growth rates.

Taken together, wind and solar power, hydroelectric plants, other renewables and nuclear energy amounted to 40.9% of global electricity generation in 2024. One year earlier, the level was 39.4%. Last year’s share was the highest since the 1940s, when the global electricity system was fifty times smaller, Ember said in its Global Electricity Review 2025. 

At the time, there was only hydropower and some biomass on the list. Solar power has been the main factor of change over the past several years, and so has China.

Global electricity demand jumped 4% last year or 1.17 PWh, amplified by heatwaves, and reached an all-time high of 30.9 PWh. Periods of higher temperatures in another hottest year ever drove up demand for cooling. The relative increase in 2023 was 2.6%.

Hydropower remained the largest source of low-carbon electricity (14.3%), followed by nuclear (9%). Wind (8.1%) and photovoltaics (6.9%)  are rapidly gaining ground and together they overtook hydro in 2024, while nuclear’s share reached a 45-year low.

Renewables meet 73.2% of growth in world power demand

Renewable power sources accounted for 858 TWh of added output. The previous record of 577 TWh was set two years earlier, as hydropower dropped in 2023, also mostly because of heat.

EVs, heat pumps, data centers and other new drivers of power demand more than doubled their share in annual growth in five years

Renewables met 73.2% of growth in demand and nuclear energy covered 5.9%. Together, they nearly accounted for all growth except the temperature effects, and the rest was from fossil fuels.

Interestingly, looking at it the other way around, the need for additional cooling accounted for the overwhelming part of the rise in fossil fuel use. Of course, the resulting additional emissions contributed to the acceleration of global warming.

Fossil fuel use would have remained almost unchanged if temperatures didn’t grow, the think tank claims. Global power sector emissions rose by 1.6% to a new all-time high of 14.6 billion tonnes of CO2.

But at least the demand for cooling during the day mostly runs in parallel to solar power production. Moreover, the pace of energy storage capacity increase still isn’t keeping up with the growing need to balance photovoltaics and wind power, as they depend on the weather.

However, the update focuses only on one indicator, within the annual growth in power demand. The system is much more complex and fossil fuels weren’t only and directly used for cooling. There is also the matter of distribution across segments from the entire output.

New drivers of demand such as electric vehicles, heat pumps and data centers contributed roughly the same to annual demand growth as the temperature effect, but more than twice as much as they did five years before.

China nearing one third of global electricity demand

China’s electricity demand surged 6.6% or by 623 TWh, which accounted for more than half of the global rise. Its 10.07 PWh in total was 32.6% of the overall figure. Five years before the country was at 28%. Renewables and nuclear energy covered 81% of its demand increase.

China’s per capita electricity use overtook France’s for the first time last year

The United States is number two overall, with 4.4 PWh in 2024 or 14.3% of the global level. China’s per capita electricity use overtook France’s for the first time, and was five times that of India’s.

Turkey’s growth rate, 5.6%, was among the highest on the planet. In absolute terms, demand jumped 18 TWh.

Photovoltaics beat coal power in 2024 in EU

Solar power production spiked by a stunning 29%, which was a six-year high, or by 474 TWh. Photovoltaics were the largest segment of new electricity for the third year in a row and grew the fastest for the 20th straight year. Total output reached 2.13 PWh.

Global solar power capacity reached 1 TW in 2022 after decades of growth, but it surpassed 2 TW only two years later. China amounted to 53% of the increase in PV generation in 2024.

Solar power topped coal power output in the European Union for the first time. As for the share of domestic production, Hungary tops the global list, with 25%. Chile is second at 22%, and Greece is third and best, with 22%, among the countries that Balkan Green Energy News mainly tracks.

Bulgaria is also in the main chart, coming in ninth on a global scale, with 14.4%.

As for solar power production per capita, Australia leads by far with 1.87 MWh, followed by the United Arab Emirates (1.29 MWh) and Greece, also at 1.29 MWh on a rounded basis. Hungary is seventh in the category, at 971 kWh per person.

In the rest of Southeastern Europe, Turkey sticks out as tenth on the planet in hydropower output, at 75 TWh. Albania has the fourth-highest share of domestic production, 97%.

Notably, Kosovo* tops the list of coal’s share in electricity production, with 92%. Bosnia and Herzegovina and Serbia still seem pretty much stuck with the technology. They are fifth and sixth, respectively, both at 63% on a rounded basis.

* This designation is without prejudice to positions onstatus and is in line with UNSCR 1244/99 and the ICJ Opinion on the Kosovo declaration of independence.