Ardagh Glass Packaging-Europe (AGP-Europe), an operating business of Ardagh Group, announced today that it has entered a long-term Virtual Power Purchase Agreement (VPPA) with Rezolv Energy’s St. George solar photovoltaic (PV) project in Bulgaria, securing renewable electricity for its glass manufacturing operations across Europe from April 2026. 

Schneider Electric, a leading adviser in corporate renewable energy procurement and carbon management, supported AGP-Europe in the VPPA negotiation.

The VPPA – one of the first to be signed in Bulgaria – is intended to provide 110 GWh per year of renewable electricity to AGP-Europe, over 12 years. It complements AGP-Europe’s renewable energy supply from wind power, secured in Sweden earlier this year. Together, thanks to their different sources, they are designed to provide AGP-Europe with a consistent renewable power supply throughout the year.

In conjunction with other Power Purchase Agreements in its portfolio, this deal is designed to enable AGP-Europe to meet over 80% of its 2030 renewable electricity targets.

Rezolv is able to sign this VPPA in Bulgaria, with a major international industrial firm, because Bulgaria is a full member of the Association of Issuing Bodies (AIB) and going through the final steps to connect to the AIB Hub, thus making its Guarantees of Origin tradeable across Europe.  Adopting this essential European legislation and enacting it fully directly supports Bulgaria in decarbonising its electricity grid for the benefit of everyone.

About the St. George solar park

The St. George solar park will be built on a brownfield site: the former Silistra airport, a decommissioned airfield covering 165 hectares. The project will comprise nearly 400,000 photovoltaic panels. St. George will be one of the largest solar projects in Bulgaria once it is operational in the summer of 2025.

In a country which has historically relied on fossil fuels for most of its energy needs, replacing fossil production with renewables delivers the maximum possible emissions reduction impact. St. George will therefore play a crucial role in Bulgaria’s energy transition and help the country meet its climate targets. 

The project will also be developed to the highest international sustainability standards to ensure that it leaves a lasting, positive legacy. 

Martin Petersson, CEO AGP-Europe said:

“We are pleased to have finalised this agreement in just six months, which is largely due to Rezolv’s flexibility, the support and technical know-how of Schneider Electric, and our own experience in this field.”

“The Bulgarian solar project perfectly meets our aim to diversify the locations of our renewable energy supply and to support emerging energy markets: AGP-Europe benefits from a supply of renewable electricity, while helping Bulgaria’s transition to low-carbon energy.”

Alastair Hammond, CEO, Rezolv Energy added:

“By signing this VPPA, AGP-Europe has become one of the most important corporate investors in Bulgaria’s energy transition. Through it, the company has become the leading enabler of St. George, a 229 MW solar project which, overall, will deliver an average of 313 Gigawatt hours of renewable electricity annually. AGP-Europe is therefore making a direct contribution to reducing Bulgaria’s dependence on fossil fuels and to enhancing its energy security.”

Jaroslava Korpanec, Partner, Head of Central and Eastern Europe, Energy Infrastructure at Actis, commented:

“In signing this VPPA for its solar project in Bulgaria, Rezolv Energy is placing itself at the heart of pioneering practices to drive the energy transition across Central and Eastern Europe while helping leading businesses power their operations more sustainably through renewable energy.”

 

Rezolv Energy was launched 18 months ago by Actis, a leading global investor in sustainable infrastructure, and already has well over 2GW of clean energy being prepared for construction in South Eastern Europe. As well as St. George, projects include Dama Solar in western Romania which, at 1,044MW, will be the largest solar plant anywhere in Europe once it is built. Rezolv also has more than 1GW of wind power under construction or in late stage development in Romania through two projects it is developing in partnership with Low Carbon. 

Actis-backed Rezolv Energy has selected three companies – CMC Europe, Solarpro and Green Solar Energy – to build the 229MW ‘St. George’ solar park in Silistra Municipality in Northeastern Bulgaria. Construction work is due to start very shortly, with the plant coming onstream next year.

CMC Europe, and Eastern Europe’s leading technology integrator Solarpro, will together act as the engineering, procurement and construction (EPC) partner for the project. 

St. George will be connected to the main transmission grid via a 110kV substation and two independent connection lines totalling approximately six kilometres in length. The high voltage work will be delivered by Green Solar Energy, also a Bulgarian company.

About the St. George solar park

The St. George solar park will be built on a brownfield site: the former Silistra airport, a decommissioned airfield covering 165 hectares. The project will comprise nearly 400,000 solar panels. 

In a country which has historically relied on fossil fuels for most of its energy needs, replacing fossil production with renewables delivers the maximum possible emissions reduction impact. St. George will therefore play a crucial role in Bulgaria’s energy transition and help the country meet its climate targets. 

The power produced will be sold to commercial and industrial users through long-term Power Purchase Agreements (PPAs). The first PPA for St. George is set to be announced very soon – a major deal and one of the first PPAs to be signed in Bulgaria. It follows the five pioneering PPAs that Rezolv has signed in recent months connected to its 461MW ‘VIFOR’ wind farm in Romania.

As well as PPAs, St. George will be financed through loan facilities from a consortium of international lending partners and regional commercial lenders. 

CMC Europe and Solarpro’s role as EPC partner will involve working alongside Rezolv to implement the Environmental and Social Action Plan for St. George. The Environmental and Social Action Plan is consistent with Rezolv’s sustainability strategy, which has been built on industry best practice and aligns with international standards, including the Equator Principles and the International Finance Corporation (IFC)’s Performance Standards on Environmental and Social Sustainability. 

In the construction phase of the project, up to 200 people will be hired, with as many employees as possible coming from the local area. Training and skills development programmes are also being put in place. This is a priority, because closing the skills gap in the renewables industry is a crucial part of the energy transition in Bulgaria. Longer term, St. George will continue to provide local employment throughout its 30 plus years of operation.

Alastair Hammond, CEO, Rezolv Energy, said:

“St. George will be one of the largest solar projects in Bulgaria, so it was necessary to find the right blend of local experience and international expertise. We also needed partners with outstanding track records who shared our commitment to sustainability. CMC Europe, Solarpro and Green Solar Energy meet all of those requirements.”

Jaroslava Korpanec, Partner, Head of Central and Eastern Europe, Energy Infrastructure at Actis, said:

“It’s terrific to see Rezolv Energy moving forward with the St. George solar park in Bulgaria. Once developed, St. George will be one of the largest solar plants in Bulgaria, operating 229MW of solar energy and playing a decisive part in the country’s energy transition. With both the VIFOR wind farm and St. George solar farm progressing strongly, Rezolv has the wind in its sails and is positioned to make a real difference in the region.”

Rezolv, which launched 18 months ago, already has well over 2GW of clean energy being prepared for construction in South Eastern Europe. As well as St. George, projects include Dama Solar in western Romania which, at 1,044MW, will be the largest solar plant anywhere in Europe once it is built. Rezolv also has more than 1GW of wind power under construction or in late stage development in Romania. 

In the last article in this series, we took a deep-dive into the telecommunications industry, a sector which, according to industry estimates, accounts for 1-2% of all energy consumed globally – and which is amongst the fastest-growing for renewable energy power purchase agreements (PPAs).

In that piece, we identified three of the most important factors driving the interest from telecoms companies in PPAs – to summarise:

1. Telecoms operators use a lot of electricity, and decisions over renewable power cannot wait if the sector is to meet its sustainability commitments
2. Renewable energy buying is being driven by the search for cost savings
3. European regulations are driving change

This time, we are going to consider this final point in more detail, but in a broader context: which regulations, directives and other EU initiatives are – or will be – the most important in encouraging European companies across all industry sectors to switch to buying more clean power?

A complex landscape

When it comes to the decarbonisation agenda, the regulatory context has been moving rapidly since the European Green Deal was first presented in December 2019 – and particularly since the ‘Fit for 55’ package was proposed by the European Commission in 2021.

Our aim here is not to summarise all of the various pieces of legislation that are designed to accelerate the energy transition and reduce emissions. Instead, we will narrow the focus down – we will:

1. concentrate on those regulations, directives and other EU initiatives which are specifically designed to encourage European companies to procure more clean power.
2. consider legislative proposals which have not yet been approved, and legislation which has been approved but is not yet fully in force – so where some of the obligations on companies are still pending (i.e. we will not focus on directives and regulations which have already been implemented in full and where the obligations on companies are already in force).

If you apply those two ‘filters’, there are six pieces of legislation which will be the most important in encouraging companies to switch to renewable energy:

1. The Corporate Sustainability Reporting Directive & the European Sustainability Reporting Standards

Sustainability reporting sits at the heart of the EU’s green strategy, and the Corporate Sustainability Reporting Directive (CSRD), which entered into force in January 2023, provides the regulatory framework for it. Companies subject to the CSRD will have to report according to European Sustainability Reporting Standards (ESRS), which the European Commission is adopting by means of delegated acts. The first set of ESRS were published in December 2023.

Here is a more detailed overview of the CSRD and ESRS:

2. The Corporate Sustainability Due Diligence Directive

The Corporate Sustainability Due Diligence Directive (CSDDD) sets obligations for large companies regarding actual and potential adverse impacts on human rights and the environment, with respect to their own operations, those of their subsidiaries, and those carried out by their business partners:

3. Reforming the design of the EU’s electricity market

In March 2023, the European Commission proposed a reform of the EU electricity market, with the aim of reducing price volatility for consumers and creating favourable conditions for investors in renewable energy. The reform includes two legislative proposals – one on electricity market design and the other on protection against wholesale energy market manipulation. One of the objectives is to support the use of more long-term instruments such as PPAs and contracts for difference (CfDs):

4. EU-wide scheme for rating the sustainability of data centres

We referenced this in the previous article in this series, but on 14 March 2024, the European Commission adopted a new delegated regulation on the first phase for establishing an EU-wide scheme to rate the sustainability of EU data centres. With data centres estimated to account for close to 3% of EU electricity demand – a figure which is likely to significantly increase in the coming years – the scheme is intended to increase efficiency developments and to promote the use of renewable energy:

5. The revised Directive on the Energy Performance of Buildings

The revised Directive on the Energy Performance of Buildings entered into force on 28 May 2024. It is relevant for companies’ use of renewable energy because it introduces a specific requirement for all new buildings to be “solar ready”, and will ensure a much wider roll-out of solar installations on buildings and renewable energy capacity on-site:

6. Proposal for a Directive on Green Claims

The proposal for a Directive on Green Claims is designed to address greenwashing. It is relevant to renewable energy because it tackles claims which rely on offsetting, emphasising the need for companies to focus on reducing emissions in their own organisation and value chain:

The regulatory landscape is making the transition to renewable energy a more and more urgent priority for companies across the EU

Since the European Parliament elections last month, there has been much talk about the ‘shift to the right’, with populist parties gaining seats across the EU – and what it might mean for the future of the Green Deal.

However, as will be clear from the overview above, much of the regulatory environment which is designed to encourage European companies to procure renewable energy is already in place – and it will not be unpicked by the new Parliament. The obligations on companies operating in the EU are coming, and as the deadlines approach, so the need to switch to clean power will only become more urgent.

What’s coming up next time?

Next time, we will be taking another sector deep-dive, this time into the industry which is leading the way when it comes to the amount of capacity that has been contracted through green PPAs: information & communications technology (ICT)…

In the last article in this series, we took the first of several deep-dives we will be taking into industry sectors which are heavily impacted by the energy transition – and which are driving demand for renewable energy power purchase agreements (PPAs) in Central & South Eastern Europe.

We started with the automotive sector. This time, we will consider a sector which, according to industry estimates, accounts for 1-2% of all energy consumed globally – and in which the PPA market is growing even faster: the telecommunications industry.

1. How does the telecoms industry compare with other sectors when it comes to signing green PPAs?

Right now, the telecoms industry sits third on the list of sectors which have contracted the most capacity through green PPAs, although it is well behind the two leading sectors on the list – ICT and heavy industry:

However, if you take ICT and heavy industry out of the equation, the telecoms industry has been the fastest-growing sector for contracting capacity via PPAs over the last five years:

2. Which telecoms operators are leading the way?

There are five telecoms operators – Vodafone, Orange, BT Group, Telecom Italia and Deutsche Telekom – in the group of 30 companies which have contracted the most clean power capacity through PPAs in Europe:

3. Which companies dominate the telecoms sector in Central & South Eastern Europe?

There are four telecoms operators which stand out in Central & South Eastern Europe because they have a significant presence in multiple countries across the region:

4. What sustainability commitments have these companies made?

Three out of four of these companies are members of  ‘RE100’, the global corporate renewable energy initiative which brings together businesses committed to 100% renewable electricity (Orange is the exception). More specifically, they have each made the following sustainability commitments:

5. How is this translating into signed PPAs?

Here is an overview of the most important European PPAs signed by this group of telecoms companies:

6. What is driving this interest in PPAs, and will it impact South Eastern Europe as well?

There is no question that this interest in green energy will transition into more telecoms industry PPAs being signed in South Eastern Europe. There are three main reasons for optimism:

1. Telecoms operators use a lot of electricity, and decisions over renewable power cannot wait if the sector is to meet its sustainability commitments:

We mentioned in the previous article in this series that automobile assembly and parts manufacturing are energy-intensive processes that rely on electricity in particular. Electricity makes up an even larger share of the energy consumption mix for telecoms operators. This, for example, is how Deutsche Telekom’s energy consumption was split last year:

Telefónica’s share was even higher: electricity represented 95% of the company’s total energy consumption.

All of the major telecoms operators have made substantial efforts to reduce their energy consumption through energy efficiency initiatives, but it is not easy given that data traffic through their networks has increased so significantly over the last decade – and continues to increase. Telefónica and Deutsche Telekom have managed to reduce their total energy consumption slightly in recent years; Vodafone and Orange’s consumption has, however, continued to rise year-on-year.

Given this, the decarbonisation targets these companies have set themselves will not be achievable without renewable energy procurement at scale, and it will need to cover all subsidiaries and geographies.

2. Renewable energy buying is being driven by the search for cost savings:

Procuring energy currently accounts for up to 40% of telecoms companies’ operational expenditure, and the search for cost savings helps explain the shift towards renewable energy that we have seen in recent years.

A recent article in Developing Telecoms explored this trend. In it, Enrique Dans, a Senior Fellow at the Centre for European Policy Analysis (CEPA), said this: “From my perspective, the most important factor here is cost. We are witnessing a huge decrease in the cost of renewable energy.”

The reality is that a well-structured PPA will, in the long-term, reduce a company’s energy costs compared to traditional utility rates – as well as shielding them from market fluctuations. As the telecoms industry has come to realise, there is a clear commercial rationale for signing a renewable energy PPA.

3. European regulations are driving change:

Telecoms companies manage data centres which store vast amounts of information – and which also consume significant quantities of energy (a topic we will dive into in more detail later in this series).

Last month, the European Commission adopted a new delegated regulation on the first phase for establishing an EU-wide scheme to rate the sustainability of EU data centres. As foreseen under the new Energy Efficiency Directive, this secondary legislation requires data centre operators to report the KPIs to the European database by 15 September 2024, and then by 15 May in 2025 and subsequent years. With data centres estimated to account for close to 3% of EU electricity demand – a figure which is likely to significantly increase in the coming years – the scheme is intended to increase efficiency developments and to promote the use of renewable energy.

This delegated regulation is just one example of how EU legislation is steering companies towards renewable energy, but it is a particularly important one for telecoms companies and the broader ICT industry.

What is coming up next time?

Next time, we will be considering the final point above in more detail: which regulations, directives and other EU initiatives are the most important in shaping the energy buying priorities of companies across Europe? We will provide an overview…

The first few articles in this series included some analyses of individual countries in Central and South Eastern Europe – specifically, Bulgaria, Romania and the Czech Republic.

It is now time for the first of several deep-dives into industry sectors which are heavily impacted by the energy transition – and which are driving most of the demand for renewable energy power purchase agreements (PPAs) in this region. We are going to start with an industry which has become almost synonymous with Central and South Eastern Europe: the automotive sector.

1. How important is the automotive industry to Central and South Eastern Europe?

Over the last 30 years, Central and South Eastern Europe has become a key centre for automotive production in Europe – benefitting from its geographical proximity to the largest markets in Western Europe and relatively low labour costs. It continues to play an outsized role economically, with Slovakia, Romania, the Czech Republic and Hungary all in the top five countries in the EU when it comes to the proportion of jobs which are created directly by the automotive sector:

The economic value is not just in the jobs the sector supports: the industry is also a vital part of international trade in these countries. For example, motor vehicles make up almost a quarter of the total value of exports from Slovakia, and contribute a very substantial proportion in the Czech Republic (10.4%), Slovenia (9.2%), Hungary (6.4%) and Romania (6.4%) too:

2. Which companies dominate the automotive sector in Central and South Eastern Europe?

There is a long list of automotive companies with production and/or assembly plants in Central & South Eastern Europe:

The list is dominated by the biggest names in the industry – including all of the world’s top five automotive companies: Volkswagen (Czech Republic, Hungary, Poland and Slovakia), Toyota (Czech Republic and Poland), Stellantis (Hungary, Poland, Serbia and Slovakia), the Mercedes-Benz Group (Hungary and Poland) and Ford (Romania).

However, as we explained in the last article in this series, the reason that the automotive sector contributes so much economically is not just explained by the presence of these multinational giants. It is also a consequence of the huge number of smaller local firms in their supply chains.

3. What sustainability commitments have these companies made?

If we narrow it down and focus in on the biggest brand names from the list above (which primarily means the passenger car manufacturers), they have all committed to firm decarbonisation deadlines:

As we also explained last time, many of these targets cover ‘Scope 3’ (the entire supply chain) as well as ‘Scope 1’ (the company’s direct greenhouse gas emissions) and ‘Scope 2’ (the emissions caused indirectly through the production of the energy the company purchases / uses). This is a positive development because Scope 3 emissions represent 80% of the total environmental impact for many large companies. However, it is also a major challenge in Central and South Eastern Europe, where there are so many smaller companies supplying these multinationals. To hold on to those contracts, these businesses will need to contribute to their customers’ carbon neutrality targets by reducing their own emissions – and demonstrate that they have done so.

4. Has this yet translated into automotive firms signing green PPAs?

With the transport and mobility sector accounting for about 23% of global energy-related greenhouse gas emissions, the automotive sector has been under heavy pressure to reduce its carbon footprint to comply with the Paris Climate Agreement – and, compared with other sectors, the automotive industry has set relatively stretching net zero targets.

However, despite that, the sector is lagging behind several others when it comes to the amount of capacity that has so far been contracted through green PPAs:

Indeed, at a European level, there are only two automotive companies – Renault and the Mercedes-Benz Group – in the group of 30 companies which have contracted the most clean power capacity through PPAs:

Mercedes-Benz was actually was actually amongst the very first movers on PPAs. The company signed its first PPA in 2018, agreeing to buy electricity generated at a 45MW wind farm 10 kilometres away from its manufacturing facility in Jawor, Poland. That was simultaneously the first PPA in this region and the first automotive sector PPA anywhere in Europe.

At the very beginning of 2019, Mercedes-Benz went on to sign Germany’s first corporate PPA, and, last year, two further (much larger) PPAs in its home market – for 140MW and 120MW, both wind power. In February this year, Mercedes-Benz also signed another wind PPA in Poland.

Renault, on the other hand, has preferred a mix of wind and solar PPAs. In 2021, the company signed a PPA with Iberdrola covering 100% of Renault’s electricity needs in Spain, which included the implementation of photovoltaic and wind projects at the company’s facilities. Subsequently, in November 2022, Renault announced the largest corporate PPA ever signed in France – 350MW of solar, enough to cover up to 50% of the electricity consumption of its production activities in France in 2027.

5. 2024 will be the year when things start to accelerate – but what is driving the interest we are now seeing in PPAs in the automotive sector?

So far, there has been far less movement on PPAs from the automotive sector in Central and South Eastern Europe, but there have been two recent deals:

• Photon New Energy Alfa Kft signed a 20-year on-site PPA with FORVIA Clarion Hungary, a subsidiary of the automotive technology firm FORVIA, for the construction and operation of a solar PV plant on the client’s factory in Nagykáta, about 80 kilometres southeast of Budapest.
• Swiss-based Axpo signed a 10-year PPA with industrial product supplier Kolektor to buy up to 200 GWh of renewable electricity over ten years. The electricity will be used at Kolektor Mobility’s facility in Slovenia, which produces components and systems for electric vehicles.

This is an encouraging sign that things are changing, and that 2024 will be a transformative year. There are three other reasons why we are so optimistic about the outlook for this year:

1. Decisions over renewable power cannot be deferred if the sector is to meet its decarbonisation commitments:

Automobile assembly and parts manufacturing are energy-intensive processes that rely on electricity in particular. This is responsible for considerable CO₂ emissions which is why renewable energy procurement will need to play a central role if the major automotive companies present in this region are to meet their decarbonisation targets. Given the deadlines, these are also not decisions which can be delayed much longer.

2. Automotive companies prefer PPAs:

As we have seen, PPAs in the automotive sector have really started to take off over the last three years in Europe. As a recent analysis of the PPA market in the automotive sector from SP Global concluded, “car manufacturers in the EU and US largely prefer PPAs, with green tariffs following. The automotive sector began to confidently gain momentum in the PPA market in North America and Europe. Its average annual growth in 2019-22 reached 50%, which makes it stand out compared with other manufacturing sectors.”

3. Available capacity:

That same SP Global analysis made one other very important point. It said that “the rate of progress in green procurement across major car manufacturers appears to be closely dependent on…the renewable generation capacity in the region where manufacturing plants are present.”

Fortunately, renewable energy capacity is now coming onstream in volume in Central and South Eastern Europe and so, really for the first time, the energy sector can meet the corporate demand for green electricity from automotive firms.

What is coming up next time?

Next time, we will be taking another sector deep-dive – this time into the telecoms industry…

In the first two parts of this series, we explained why Rezolv is investing in Bulgaria and Romania. We focused on the impact that the development of renewable energy will have on emissions and human health. We also outlined why the energy transition is necessary for long-term economic competitiveness.

However, there is one other aspect we didn’t consider which is also driving change: large-scale renewable energy projects like those Rezolv is developing in Romania and Bulgaria will contribute to both countries’ climate targets.

Let’s consider Romania first. Last time, we mentioned that the percentage of electricity generated from fossil fuels in Romania dropped below 30% for the first time in 2023, with overall renewables capacity increasing from 43.1% in 2022 to 50.4%. 65% of that renewables capacity was hydropower, but we shouldn’t understate the progress that was made last year, particularly on solar power. As in Bulgaria, 2023 was the year when Romanian solar turned the corner, with over 1GW of new capacity installed, a 308% increase on 2022 – making solar PV the fastest-growing power source in the country.

To put that into a regional context, here’s how Romania stacked up against other countries in Central & South Eastern Europe in 2023 in terms of both wind and solar capacity:

Wind capacity also increased very slightly last year in Romania – but from a much higher starting point. On both fronts, though, there is more work to do to reach the EU average, let alone catch the countries that are leading the way in the region.

Romania’s renewable energy target keeps increasing

It’s also worth considering the progress made in 2023 against Romania’s 2030 renewable energy target. The reality is that its impact was diluted by the fact that that target has been steadily increasing as the EU’s level of ambition has risen.

Romania’s Integrated National Energy and Climate Change Plan (NECP) for 2021-2030, which was submitted to the European Commission in 2018, set a target for the total share of renewable energy in final gross energy consumption of 27.9% by 2030.

The revised NECP, submitted in April 2020, increased that target to 30.7% – short of the Commission’s recommendation of at least 34%, but still a significant increase.

Most recently, the revised draft of the NECP that was submitted in November 2023 indicated that Romania could reach 36% by 2030 – with wind and solar the main contributors:

Attitudes are also being shaped by the renewable energy potential in the region

Romania’s increased ambition is not just a response to pressure from the European Commission: it’s also driven by Romania’s enormous renewable energy potential. For wind power, there are exceptional natural resources in some parts of the country, particularly in Constanța county where Rezolv’s 600MW Dunarea East & West wind farms will be built. But it’s not only along the Black Sea coast. Rezolv’s other onshore wind project in Romania, VIFOR, is in Buzău county, more than 200km inland – where the proximity to the Carpathian Mountains also gives rise to high wind yields.

The solar potential is huge too. Romania joined the International Solar Alliance during COP28. In making the announcement, Energy Minister Sebastian Burduja estimated the country’s technical solar potential at 19.35GW (25.80 TWh), with 18.05GW (24.18 TWh) deemed economically viable under minimum cost scenarios. These are not small numbers, and it’s primarily, obviously, because the whole of South Eastern Europe enjoys plenty of sunshine.

It’s also about available land, though. Very large-scale solar projects like those Rezolv is developing require large, flat sites (as well as good solar irradiation and grid access). Our 229MW St. George project in Bulgaria, for example, will cover 165 hectares. Dama Solar, our 1,044MW solar project in western Romania, will be significantly larger than that.

Sites of that size are clearly not available everywhere, but they are a bit easier to find in Central & South Eastern Europe than some parts of Western Europe – because it is not the most densely populated part of Europe:

Bulgaria: a case study of how broader government priorities are driving the energy transition

Political attitudes in Bulgaria also illustrate the fact that EU targets are not the only driver of change in this region.

Ahead of the unveiling of the EU’s climate target for 2040, 11 member states jointly called on the EU to set “an ambitious climate target for 2040…[which] should be in line with the long-term temperature goal of 1.5°C… The target should also ensure that the EU is fully on track to climate neutrality by 2050 at the latest aiming to achieve negative emissions thereafter.”

Bulgaria was the only Central & Eastern European country in the group of 11 member states that signed that letter. Why Bulgaria?

In part, it is the same factors that are driving the commitment to the energy transition across this region: the need to secure energy supplies, enhance energy independence and drive down energy prices – all of which have become political priorities everywhere since the start of the war in Ukraine.

As in Romania, it is also an acknowledgement of the renewable energy potential in Bulgaria. For example, Bulgaria is on track to achieve its 2030 NECP target for solar power about seven years ahead of schedule, and a recent study from the Centre for the Study of Democracy found that Bulgaria could add between 3.8GW and 4.2GW of wind capacity by 2030, and another 5GW by 2040; offshore wind could add more than 150GW on top of that.

Indeed, based on a study by Ember, the cheapest pathway for Bulgaria’s power sector which is compatible with the 1.5°C temperature goal mentioned in the letter involves the installation of huge amounts of solar and onshore wind:

And it’s not just the EU member states…

We are seeing similar levels of commitment to renewables from non-EU member states in the region as well. For example:

• By 2030, North Macedonia has committed to reducing its net greenhouse gas emissions by 82% compared to 1990 levels. The energy transition will be key to achieving this given how dependent the country has historically been on coal. This commitment is already being backed up by action. Last year, North Macedonia posted 160% growth in new renewables capacity and, at COP28, announced a coal phase-out by 2030.
• Under its draft NECP, Serbia will, by 2030, aim to increase the share of renewables in electricity production to 45.2% and deliver a 40.3% reduction in greenhouse gas emissions compared to 1990.
• Bosnia & Herzegovina aims to deliver a renewable energy share of 43.6% by 2030, most of which will be solar.

Renewables targets will continue to grow – which also represents a big, but not insurmountable challenge

Countries in Central & South Eastern Europe are not purely motivated by the requirement to meet climate targets, but, at the same time, no one is in any doubt that the pressure from Brussels will only continue to increase.

Indeed, on 6 February 2024, the European Commission published a detailed impact assessment on possible pathways to reach the agreed goal of making the EU climate neutral by 2050. Based on the assessment, the Commission expects renewable energy, “complemented by nuclear energy”, to generate over 90% of the electricity consumption in the EU in 2040. A legislative proposal will be made after the European elections, and it will need to be agreed with the European Parliament and member states – but even a watered-down version of this proposal will translate into more ambitious renewable energy targets for every member state.

This will be particularly challenging for the largest and most heavily industrialised countries. If you take ‘Central & South Eastern Europe’ to mean the EU member states in the region plus the non-EU countries in the Western Balkans, there are only four countries where annual electricity demand exceeds 50 Terawatts – Poland, the Czech Republic, Romania and Greece:

In these countries, increasing the share of renewable energy is a bigger challenge than it is in smaller countries, because each percentage point represents more gigawatts of renewable capacity.

Summing up: significant  progress has been made over the last 12 months, but even more urgency is needed

The political support we are seeing for renewable energy is, of course, not only a consequence of ever-increasing EU targets – but those targets certainly do help focus minds. The truth is that 2030 is not very far away, and large-scale renewable energy projects – the quickest and most effective route to meeting those targets – take time to develop. The progress we have seen across the region over the last 12 months is a great start, but even more urgency is needed.

What is coming up next time?

Some countries’ 2030 targets look tougher to achieve than others’,  and next time we are going to be looking at one member state which still has plenty to do: the Czech Republic…