GGF-backed photovoltaic plant under construction at North Macedonian coal pit

Renalfa IPP is building a solar power plant in the REK Oslomej coal complex in North Macedonia under a public-private partnership. It obtained financing from the Green for Growth Fund.

The days of coal-fired power plants in the Balkans are numbered, according to all the outages, abrupt closures, market volatility and environmental requirements. Governments have little time to ensure the survival of conventional power utilities and maintain the stability of supply. One of the quickest and most affordable solutions is to replace part of the capacity with solar power. One such project, backed by the Green for Growth Fund or GGF, is underway in North Macedonia.

Within the REK Oslomej coal power complex, one of the largest solar power plants in the region is under construction. The European Union has declared it one of the 17 flagship projects under the Western Balkans Investment Framework (WBIF).

Impact asset manager Finance in Motion arranged the financing, which is provided by the Green for Growth Fund. Solar projects in Oslomej in the Kičevo municipality support a larger effort to clean up the site, diversify energy sources, support decarbonization and define redeployment and reskilling opportunities in the wider regional labor market to retrain the local workforce.

Renalfa IPP’s investment is one of two public-private partnerships in Oslomej

The 50 MW plant is seen generating almost 100 GWh of electricity in its first year of operation.

“After our first investment in the Bogoslovec wind park in North Macedonia, this investment in solar is a sign of continued commitment to expanding renewable energy capacity in the region,” said GGF’s Board of Directors Chairperson Simon Gupta.

Renalfa IPP won the contract at an auction in 2021

The project sponsor is Renalfa IPP, an Austrian-based developer and independent power producer. It is a joint venture between Renalfa Solarpro Group and the French investment group RGreen Invest. The sponsor was awarded the contract for one of two solar power plants, tendered in a live auction in April 2021 to establish a public-private partnership. Turkish-based Fortis Energy was selected for the other one and recently completed it.

Fund finances pioneering renewable energy projects in Western Balkans

GGF backed two pioneering solar power projects in neighboring Albania – Karavasta and Blue 1. Vienna-based Renalfa IPP recently installed the largest battery system in Bulgaria. The company owns and develops photovoltaic, battery energy storage and wind projects with a joint capacity of 2 GW in Bulgaria, Hungary, North Macedonia and Romania. More than 455 MW is operational and more than 550 MW is in construction.

REK Oslomej hosts the first photovoltaic facility in the Western Balkans built on coal land

The endeavor in Oslomej, financed through private and public funding, includes mitigating job loss by retraining and hiring former employees of the thermal power plant in the country’s west. The region has historically been dependent on the coal industry for employment and tax revenues.

In REK Oslomej, state-owned utility Elektrani na Severna Makedonija or ESM built the first solar power plant on an abandoned coal pit in the Western Balkans. It commissioned the facility in 2022.

GGF-backed solar power project reducing North Macedonia’s dependence on fossil fuels, energy imports

The GGF-backed project is on land unsuitable for most other uses. “Our investment in the Oslomej solar project underscores our commitment to North Macedonia’s green energy transition. By reducing reliance on fossil fuels and enhancing energy security, this project aligns with our mission to mitigate climate change and promote sustainable energy solutions,” said Fund Director at GGF Borislav Kostadinov.

North Macedonia wants to generate at least 43% of its electricity from renewable energy sources by 2040. To date, the country has mainly used fossil fuels – primarily lignite and gas, as well as a small amount of hydropower – and is dependent on energy imports that are mostly fossil fuels, GGF noted.

The fund invests in measures designed to cut energy use and CO2 emissions and improve resource efficiency in 19 markets across Southeast Europe, the Caucasus, Ukraine, Moldova, the Middle East and North Africa. Finance in Motion is a global impact asset manager focused exclusively on sustainable development in emerging markets and developing economies.