The European Bank for Reconstruction and Development (EBRD) is providing a €30 million (US$32.67 million) loan to Serbia to finance investments in renewable heat generation in several district heating companies in the country, along with related energy-efficiency measures including the modernization of heat substations and district heating networks.
The project will be supported by donor-funded assistance of up to €12 million mobilized by the EBRD from the Swiss State Secretariat for Economic Affairs, the European Union under the Regional Energy Efficiency Programme (REEP), and the government of Austria through the Renewable District Energy in the Western Balkans Programme. It will be implemented by the Ministry of Mining and Energy in cooperation with the participating municipalites and district heating companies.
The signing of the loan was attended by Serbia’s minister of finance Siniša Mali and minister of mining and energy Dubravka Đedović Handanović, as well as by EBRD president Odile Renaud-Basso, who signed the agreement on behalf of the bank. Present at the signing were Swiss ambassador to Serbia Urs Schmid, Austrian ambassador Christian Ebner, and Elvira Angulo Rodrigues, head of operations I of the EU mission in Serbia.
“With today's signing, we completed the complete financial construction for this project, worth €40.5 million with a total of €10.5 million worth of grants," Serbia’s Handanović says. "The citizens of Bečej, Bogatić, Kragujevac, Kraljevo, Kruševac, Novi Pazar, Niš, Pancevo, Paraćin and Vršac will receive a cleaner and more modern district heating system.
"In the previous period, we worked on the introduction of biomass into district heating systems, while through this project, heating plants in Serbia will start using solar collectors, heat pumps, waste heat, geothermal sources, along with the accompanying modernization of the hot water network."
Sustainable energy
Emanuele Giaufret, EU ambassador to Serbia, adds: “Removing dependency of fossil fuels and energy security are important questions in the current climate, both in terms of environmental protection and geopolitics. The REEP is one of the tools the European Union has to help the region achieve these goals.
"The objectives of REEP are supporting the Western Balkan beneficiaries achieve their sustainable energy objectives, help create a sustainable market for energy efficiency in the region, promote renewable energy and energy efficiency, and stimulate energy efficiency investments. The initiative signed today checks all the boxes and we are proud to support it.”
Currently, Serbia's district heating systems rely heavily on fossil fuels and are notably energy-inefficient. The project, the first of its kind in southeastern Europe, aims to address these challenges by providing significant environmental benefits and boosting energy security.
With Serbia importing up to 90% of its natural gas supplies, the increased use of renewable and waste heat in district heating systems will reduce the country's dependence on imported petrol products and natural gas for heating and cooling.
The project is expected to deliver considerable environmental benefits by producing 115 gigawatt-hours of renewable and waste heat per year, reducing annual carbon emissions by approximately 14,600 tonnes of CO2 equivalent, and making significant savings in water and energy.
The district heating companies will integrate cutting-edge solar-thermal technology, heat pumps, and urban and industrial waste-heat and geothermal technologies into their existing systems.
