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Western Balkans: saving money by investing in renewables

Western Balkan countries can phase out coal by 2040 and achieve a carbon-free power system by 2045 if they invest in renewable energy, energy storage and green hydrogen, a new study led by Agora Energiewende finds.

“Our study finds that transitioning to clean energy will cost the region 15 per cent less than replacing ageing lignite power plants with new coal or fossil gas,” said Matthias Buck, Europe Director of Agora Energiewende. “A smart transition in the Western Balkans region builds on a mix of renewables, energy storage and green hydrogen to minimise costs and maximise energy security while entering a path towards climate neutrality by 2050. Renewables are the best option in the power sector to limit global warming to 1.5°C and to chart a sustainable way out of the fossil energy crisis.”

Targeted investments into energy storage capacity will enable rapid growth in solar PV, the most easily scalable renewable technology. Storage also lowers the need for hydrogen power plants to replace fossil gas infrastructure.

“The need for hydrogen must not be overestimated when planning for the power sector infrastructure”, cautioned Mr Buck. “For Western Balkan countries, 5 gigawatts worth of green hydrogen plants, covering 7 per cent of demand in 2045, is needed to ensure the security of supply.”

As members of the Energy Community, Western Balkan countries are expected to prepare draft National Energy and Climate Plans (NECPs) by June 2023 to show how they plan to transform their power systems in this decade, having in mind their set target of reaching climate neutrality by 2050.

The study entitled Powering the Future of the Western Balkans with Renewables compares three different scenarios: the baseline scenario or a continuation of current national plans and policies, the gas lock-in scenario where the decarbonisation relies on fossil gas and the smart transition scenario where fossil gas is replaced with energy storage and green hydrogen to the greatest possible extent.

Overall, the results show that a coal phase-out in the Western Balkans by 2040 is technically feasible at no additional costs if embedded in a transitional strategy that aims at full decarbonisation

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