The production of energy from coal is losing importance in the world and European investors are abandoning investment in such projects, as illustrated by the case of a thermal power plant in Montenegro for which the Czech Export Bank has failed to secure funds, said Dragana Mileusnić of the Climate Action Network (CAN) Europe. In an analysis of the steps Serbia needs to take in the fight against climate change, she pointed out that the Western Balkans was highly sensitive to climate change, while Serbia still relied on coal in the production of energy.
“While we are securing funding for coal, China is globally becoming a leader in the fight against climate change and plans to cut down its emissions and the amount of energy produced with coal. At the same time, European investors are abandoning further investment in such projects, knowing that they are not profitable in the long term,” said Mileusnić, the coordinator of Southeast Europe energy policies at CAN Europe.
In the analysis posted on the EurActiv Serbia website, Mileusnić added that this was also illustrated by an example from Montenegro, where the Czech Export Bank recently stated it could not provide funding for the planned second block of the Pljevlja thermal power plant.
Mileusnić said that, since the effects of climate change were already noticeable, and Serbia had great potential for renewable energy sources and energy efficiency, the Serbian climate objective must undergo a serious review.
“On the one hand, measures of adaptation of the sectors most sensitive to the consequences of climate change should be developed, but greenhouse gas emissions should also be reduced. Keeping in mind that most national emissions in Serbia originate in the energy sector, that means a gradual move from coal to renewable energy sources, with a mass implementation of energy efficiency measures,” she said.
She added that Serbia should ratify as soon as possible the Paris Agreement that came into force on Nov. 4, otherwise it would not be able to take part in the decision making regarding its implementation.
Serbian officials have announced that Serbia plans to ratify the document no later than mid-2017.
Mileusnić said that Serbia should demonstrate readiness to decisively apply the Paris Agreement by developing an ambitious strategy for combating climate change.
She went on to say that in the making of that strategy, which began around the middle of this year, options should also be considered for a much greater reduction of greenhouse gas emissions than the current goal.
Mileusnić added that, by setting the objective of reducing greenhouse gas emissions at 9.8 percent by 2030, relative to 1990, Serbia had in fact left room for increasing emissions.
“The competent institutions justify this trend by saying that Serbia is rich in cheap coal which must be used for economic development. The price of that coal, however, is somewhat different when taking into account the actual costs of producing energy from this fuel, such as the cost of air pollution created in the process of burning coal,” she said.
According to Mileusnić, the World Health Organization last year stated that the cost of air pollution in Serbia accounted for one third of national income.
In June 2015, Serbia presented its national objectives for reducing carbon dioxide emissions, which is the first time it has pledged to make a reduction.
Serbia was the first EU candidate country to have set an emission reduction goal, but environmental organizations raised the question of data based on which the reduction had been calculated, as it was unclear whether the data on emissions from Kosovo, which declared independence in 2008, had been included.
Serbia’s report according to the U.N. Framework Convention on Climate Change reads that in 2013 Serbia saw a 25.1 percent reduction of emissions relative to 1990.
Where renewable energy sources are concerned, the only one Serbia is using to a greater extent is hydropotential for the production of electricity.
According to the Electric Power Industry of Serbia (EPS), Serbia is currently getting one third of its electricity from hydropower plants, i.e. about 10.5 TW, and is in second place, behind Romania, in using water to produce electricity.
Serbia uses 55 percent of its hydropotential to produce electricity, but even if it were using that potential in its entirety it still could not secure energy stability without thermal power plants, according to the EPS, whose representatives in early November said that the current priority was the reconstruction of existing hydropower plants, on which 500 million euros would be spent by 2025.
Coal is the dominant raw material in the production of electricity in Serbia, while the most used in heating are natural gas and wood, although many citizens also use electricity for heating, which is cheap thanks to its regulated price.
The price of electricity for Serbian households without taxes, the excise and renewable energy sources fee is 6.6 dinars per kWh, or about 0.05 euro cents, which makes it one of the lowest in the region and Europe.