Emergy pursuing ambitious renewable energy expansion from Serbia to other countries of the SEE

Foreign investors today evaluate the availability of green electricity for their production facilities as a top priority when deciding in which country they will invest, Founder and Chief Executive Officer of Emergy Joar Viken said in an interview for the Balkan Green Energy News. The statement accentuates his and his team’s belief that the investments of Emergy and its local partner WV-International into renewables come at the right moment.

Together with WV-International, its Serbian partner, the Norwegian company is finalizing activities to start in the spring 2023 construction of its first two wind farms of a total wind portfolio of 800 MW in the country. Viken revealed that the company intends to sell electricity from those two renewable energy plants only on the domestic power market. However, plans of Emergy do not stop here. The company has entered several other markets in South-East Europe, Viken explained.

Norway’s embassies in the Western Balkans, Serbian authorities and the Nordic Business Alliance recently organized a conference in Belgrade on investments in renewable energy. Norwegian firms presented the latest technologies to top officials and potential clients and partners, vowing to contribute to the region’s energy transition in coordination with the government in Oslo.

Balkan Green Energy News used the opportunity to speak to Joar Viken, the Founder and Chief Executive Officer of Emergy, the first Norwegian company in renewable energy sources in Serbia.  The company, in partnership with WV-International, established a foothold with mid- and late-stage wind power projects of 800 MW in total. All the locations are in the Banat region, in the country’s northeast. An 80 MW solar power project in nearby Žabalj is also in the pipeline.

Emergy and WV-International aim to get their 800 MW renewables portfolio online by 2027

According to Viken, the construction of the Alibunar 1 and Alibunar 2 wind power plants, with a total capacity of 168 MW, is scheduled to begin in spring 2023. Works on the next batch of projects are expected to early 2024. He pointed out that the goal is to get the entire portfolio online by 2027.

Anchored in Southeastern Europe

Emergy was founded in 2004. The company has a track record of building 3 wind projects totaling 400 MW in China and Ukraine, while its focus is currently on Southeastern Europe. In addition to the portfolio in Serbia, Emergy own a portfolio of 1,3 GW in Greece, Romania and Ukraine.

Viken asserted that the project in Romania is aiming for a financial close in 2025 as it has to wait for a date for the connection to the transmission system. We also have an agreement in Romania for the production of hydrogen, an emerging storage segment,” he said.

Romania and Greece are conducting massive legislative reforms to spur renewables deployment. Nevertheless, grid availability is becoming a universal issue, Viken said. He warned that investors in green electricity in the Western Balkans may face the same bottleneck.

Viken revealed that Emergy is also expanding to Bosnia and Herzegovina, where it signed an MOU for the development of a solar power plant.

“We are looking at more or less all the countries in the Balkans for opportunities. The electricity market here is in need of decarbonization, as well as energy security, particularly in the context of the war in Ukraine. In the Western Balkans, exporters to the European Union will be hit with a cross-border carbon tax because of the European Green Deal, or they will have to buy domestic CO2 permits. The only way to avoid it is to use renewable energy,” Viken pointed out.

Team is what matters

Emergy’s CEO switched to the renewable energy sector almost two decades ago from the real estate market. In his words, the team is what makes the difference in business.

“We work closely with local partners, like here in Serbia, and the local team is equally significant. It is important for us to have a local footprint and understand the local culture. You need to have the right people as there are so many elements that need to be put together, especially in the wind power segment,” Viken stressed.

The company’s vision is to contribute to the green shift in the Western Balkans. Viken says the idea is for the projects to be up to the highest environmental, social, and corporate governance (ESG) standards. “This approach makes the projects to be compliant with international standards. We believe it also will bring financial benefits in addition to be sustainable for a long term,” he asserted.

We are good first movers

The renewables investment conference in the Serbian capital was a success, Viken underscored and added that follow-up meetings are already being planned.

“Western Balkan countries can help each other in renewable energy deployment. We, as an industry, are happy to work with the Government of Norway and the governments in the region. The industry in Norway is very focused on renewables, and the knowledge is there,” he said.

In its strategy, Emergy did not opt for developing projects in Norway but opted for a role of a first mover in the markets worldwide. “We try to be in the early markets because it is what we are good at,” Viken explained.

Power demand is yet to surge

The 800 MW portfolio in Serbia will be worth more than EUR 1 billion fully operational, the company’s head estimated. Asked about the perspectives on green electricity capacities in the country and the Western Balkans and the opportunities to export, he offered the view that it is primarily important to cover the rising domestic demand for renewable energy.

“The needs will rise rapidly as everything is going to be electrified. Take electric cars. In Norway, 85% of new cars are electric. It is coming. A very important factor is that different industries are establishing manufacturing facilities in Europe instead of in Asia. Western Balkan countries are working to attract foreign direct investments. All new factories will have zero-emission targets. That’s why the governments in the region need to have renewable energy to offer. Otherwise, the new industry will go somewhere else. The issue wasn’t in focus or sufficiently understood so far, but people are starting to wake up. It is super important,” Viken stated.

All new factories will have zero-emission targets, so the governments in the region have the task of securing renewable electricity supply

Moreover, he said his company is in the regional market for the long run. “We develop, finance, build, operate and own projects until the end of their lifetime. That is 35 years, on top of several years for development and construction!” Emergy’s CEO specified.

He clarified that the electricity from the current wind power projects in Serbia would be sold only for domestic consumption. Power purchase agreements will be signed with private off-takers for half of the forecasted output, and the rest will be sold l to the open market, Viken explained.

Auctions mechanism is important yet transitional chapter

Commenting on the renewed announcements of upcoming wind power auctions, Emergy’s CEO said the company is ready to participate in the upcoming wind power auction.

“Auctions are an important new chapter for the sector as they contribute to securing supply and liquidity in the power market. All producers need a liquid intraday market, which implies matching supply and demand. On the other hand, I believe that auction-based subsidies are a transitional phase, and that the renewable electricity would eventually be bought and sold entirely on a market basis,” Viken added.