The passage towards a climate-neutral economy requires both the policymakers and implementers to consider core and comprehensive dimensions of a just transition where ‘no one is left behind’. The Western Balkan (WB) countries, all aspiring toward the European Union (EU) accession, have undertaken an ‘obligation’ to move towards the alignment with the EU acquis, including the policies regarding taking climate action and thus energy transition. In line with the EU’s ambition to become climate-neutral by 2050, the WB region committed to achieving carbon neutrality by 2050, and to aligning with the European Green Deal’s key elements by endorsing the Green Agenda for the Western Balkan (GAWB).

The research case of CEA within the auspices of GreenFORCE will focus on the first pillar of the Green Agenda for the WB, the pillar of climate action – decarbonization, especially on the aspect of just transition in the energy sector. The pillar of climate action is quite comprehensive and it covers decarbonization, energy and mobility, focusing on the energy sector and specifically deep dive onto the aspect of just transition as stated in the GAWB: “transition to climate-neutrality must be socially just and inclusive in order to be a success.”

One of the directly and especially affected sectors for North Macedonia, is the energy production. The electricity production mix in the Republic of North Macedonia (RNM) is highly coal-dependent, as over two-thirds of the primary fuel mix is based on solid fossil fuels. The exploited forms of energy in RNM are coal (lignite with a low calorific value from the category of young lignite), firewood and wood waste, hydro potential, solar, wind and geothermal energy.

The energy production in RNM indicates a gradual dependency decrease on coal-based production, however, the contribution of lignite (coal-based) is still contributing to 70% of the domestic production. Furthermore, the energy production in RNM notes a significant decrease in domestic production (from 6.744 GWh in 2010 to 5.284 GWh in 2021), mainly due to a 50% decreased production by the state-owned largest producer (AD ESM Skopje) in both, hydropower and thermal power. The production of electricity by hydropower plants is significant (11%) but dependable on meteorological conditions. The electricity production by thermal power plants also records a downfall.

The reasons for the overall decline in thermal power plant production is primarily due to the effects caused by the obsoleteness of the thermal power plants, which are already way past their expected life, thus followed by operation disruption, exacerbated by the low-quality coal, inadequate investments, low efficiency, etc.

 Nevertheless, the production of electricity by the coal-fuelled TPP Oslomej has increased significantly (twice more in 2019 compared to 2013), although, in the past years, TPP Oslomej has had low electricity production due to the depletion of the nearby exploited coal reserves and the increased production is fuelled by externally procured (imported) coal (ERC 2021 Annual Report). Having said that, the thermal plant energy production in 2021 contributed with 39% to the total domestic production with a significantly larger contribution from TPP Bitola (35%), and TPP Oslomej the remaining 4%. Important to note that besides the plans for gradual closure of the latter, the current energy crisis in Europe, resulted in policy degradation towards the opposite decisions for increasing energy production in 2022 from fuel-based sources.

The national law on energy and the long-term national strategy (Ministry of Economy of RNM, 2019) concerning TPP Oslomej envisaged scenarios for decommissioning this plant, initially planned to happen in 2021, and for the country to be fully coal-free in 2027. However, the plan did not effectuate by 2021. On the contrary, TPP Oslomej has been reactivated to provide a larger contribution to the domestic energy supply, and even exacerbated by announcements of plans for reopening new nearby coal mines. In January 2022, the coal phase-out of the TPPs was delayed until 2030 due to concerns over (current) energy security crisis which is contrary to all the commitments and plans undertaken by North Macedonia towards climate neutrality.

In the same policy vein, the long-awaited and still pending climate law is not adopted and enacted yet, remaining in a process of preparation for several years. The climate law will aim to regulate the framework for climate action for reducing greenhouse gas emissions (GHG emissions) and adaptation to climate change, including strategy planning, monitoring and reporting, and international agreement ratification.

The long-term strategy on climate action (Ministry for Environment and spatial planning of RNM, 2021) has however been prepared and recently adopted together with an action plan. The strategy reiterates the commitment to decommissioning TPP Oslomej (by 2025), the strategy notes the social effects (laying off) for around 1000 employees for the case in question, furthermore noting the identification of the green transition challenges and just transition plan development need.

The current overview of the policies that are concerning the issue of decarbonization in North Macedonia are on a national level solely, and strive towards alignment with the EU acquis, however, any regional or local policies are constrained and not taken on a subnational level, yet.