Opportunities for renewable energy investments in Serbia April 12, 2017 Nikola Ćatović, Consultant at MACS MACS Energy & Water doo Dubljanska 18 Tel +381 64 245 0008 e-mail: nikola.catovic@macsonline.de Internet: www.macsonline.de

About MACS MACS Energy & Water is an independent international consulting company, working in the field of Infrastructure Finance for Water and Sanitation as well as Energy Efficiency (EE) and Renewable Energy (RE) The efficient use and alternative sources of energy as well as the increasing severity of water risks are progressively becoming a major concern for people and governments from all over the world. Our vision of sustainability is guided by the efficient use of these two essential resources – Water and Energy

About MACS MACS GmbH Frankfurt MACS Belgrade, Serbia MACS do Brasil MACS Caucasus Georgia - Project Office MACS Montenegro - Project Office

About MACS Support to financial institutions in RE projects evaluation Technical Due Diligence Project implementation monitoring Energy Auditing Support to investors in project development

Renewable energy resources Inexhaustible energy resources Polution and GHG emission reduction Electricity supply independence Available supporting policy mechanisms for investors

Energy sector: Serbia

Renewable energy: Serbia Requirement for 2020: RES to keep 27% share in electricity demand (big + small scale) Electricity supply security Reduce dependence from fossil fuels Establishing a sustainable power system Environmental impact mitigation

Renewable energy: Serbia Source [GWh] [%] Total electricity generation (EPS + independent) 35,888 100.00% Electricity from incentivized producers 227 0.63%

Development of Regulatory Framework Energy Law (2004, 2011, 2014) RE directives/by-laws, (2009, 2012, 2016) Subsidy scheme for feed-in tariffs Standardized Bankable PPA (2009, 2012, 2016) Financing mechanism in place 2004 2006 2009 2011 2012 2016 2017

Three gears that make an RE project work Institutions: Supportive Regulatory framework Banks: Appropriate financial mechanisms Developers: Professional project preparation

Technology: Photovoltaic

Technology: Photovoltaic 121 project of total 10,426.71 kW Cap approved under the feed-in tariff scheme: 10MW Registered generation in 2015: 10,563,814.18 kW Share of electricity demand in 2015: 0.03% Type of installation Installed power P [MW] Feed in tariff [c€/kWh] MAX effective working time in incentive year [h] roof top installations up to 0.03 14.6-80*P 1400 0.03-0.5 12.404-6.809*P on ground all 9

Technology: Photovoltaic Installed power: 2 MW Year of implementataion: 2013 Subsidy price 0.23 EUR/kWh Total investment EUR 3.4 million Annual revenues of electricity sale: cca.400,000 EUR

Technology: Photovoltaic Installed power: 50kW Year of implementation: 2015 Subsidy price 0.1625 EUR/kWh Total investment EUR 72,550 Annual revenues of electricity sale: cca.12,200 EUR

Technology: Wind power

MAX effective working time [h] in incentive year Technology: Wind power 2 projects of total 16.5 MW 500 MW “quota” Total registered generation in 2015: 416,641 kWh Share of electricity demand in 2015: 0.001% Price [c€/kWh] MAX effective working time [h] in incentive year 9.2 3000

Technology: Wind power Installed power: 6.6 MW, Year of implementation: 2016 Subsidy price 0.0937 EUR/kWh Total investment EUR 10 million Payback period 11 years, P90 scenario Annual revenues of electricity sale: cca. EUR 1.7 million

Technology: Biomass & Biogas

Technology: Biomass & Biogas 11 projects of total 12,967 kWe Total registered generation in 2015: 21,983,915 kWh Share of electricity demand in 2015: 0.07% Most significant RES potential : 3.405 million toe Timber 1.53 million toe – central Serbia Agri-biomass 1.67 million toe –Vojvodina Waste (animal origin, edible oils, primary biodegradable) 0.248 million toe

Technology: Biomass & Biogas Installed power: 0.99 MWe, 1.2MWt Year of implementation: 2017 Subsidy price 0.185 EUR/kWh Total investment EUR 4 million Payback period 7 years Annual revenues of electricity sale: EUR 1.4 million Annual operation costs: EUR 850,000

Technology: Hydropower

SHPP in Serbia: Distribution of projects by year

SHPP in Serbia: Distribution by installed capacity

Technology: Hydropower 71 SHPP projects of total 47 MW Total registered generation of SHPP in 2015: 147,970,507 kWh SHPP share of electricity demand in 2015: 0.47%

Technology: Hydropower Installed power: 160kW Year of implementation: 2016 Subsidy price 0.124 EUR/kWh Total investment EUR 600,000 Payback period 10-11 years Annual revenues of electricity sale: cca. EUR 70,000

Technology: Hydropower Installed power: 1,500kW Year of implementation: 2016 Subsidy price 0.104 EUR/kWh Total investment EUR 3,200,000 Payback period 10 years Annual revenues of electricity sale: cca. EUR 420,000

Opportunities for DSW members Technology and equipment providers Legal advisory for foreign and domestic investors Project development Works execution Opportunities for new investments in the RE sector

Thank you for your attention! April 12, 2017 Nikola Ćatović, Consultant at MACS MACS Energy & Water doo Dubljanska 18 Tel +382 64 245 0008 e-mail: nikola.catovic@macsonline.de Internet: www.macsonline.de