EU-backed plans for €3.5 billion in gas-fired power plants, pipelines, and liquefied natural gas terminals in the Western Balkans will introduce economic and security risks to the region and challenge the energy transition, according to research by Global Energy Monitor and Bankwatch.
In 2021, the six countries of the Western Balkans – Albania, Bosnia and Herzegovina, Kosovo, Montenegro, North Macedonia, and Serbia – consumed a mere 3.7 billion cubic metres (bcm) of gas or 4% of what Germany used that same year.
But proposals to expand the gas network in the region, backed by the EU and US, would expose the region to volatile price swings and gas shortages that have plagued much of Europe since Russia invaded Ukraine in 2022.
Pippa Gallop, Southeast Europe Energy advisor at Bankwatch, said, ‘Fossil gas infrastructure built now will be a liability for the Western Balkans. Either it will increase import dependence and fossil-fuel lock-in, or it will end up as stranded assets. If the EU and its banks have learnt anything from recent supply problems, they must stop peddling fossil gas in the region.“
The warnings come shortly after renewed warnings from the Intergovernmental Panel on Climate Change, which said that no new fossil fuel infrastructure should be built to limit planetary warming to 1.5 degrees Celsius.
Robert Rozansky, Research Analyst at Global Energy Monitor, said, ‘Countries around the world are rethinking their plans to import this volatile, dirty fuel amid the global energy crisis. If the Western Balkans forge ahead with new gas infrastructure, it will only make it harder to transition to clean, domestic, and affordable energy.”
Several large gas projects are underway in the region, including the region’s first two LNG terminals planned, in Montenegro and Albania. The organisations said, “this would increase exposure to a tight, volatile LNG market with over 0.5 billion cubic metres of regasification capacity.”
Furthermore, a planned 2,715 kilometres of new gas pipelines would draw gas into the Western Balkans from Greece, Croatia and other neighbouring countries/.
The region is known for significant potential in solar and wind energy, something that gas infrastructure plans would undermine. This could also introduce new hurdles to EU integration and accession as it contradicts the provisions of the Energy Community Treaty and the green energy efforts of the EU.
Currently, the Western Balkans draws much of its energy from hydropower and coal, with the latter looking to be phased out. Albania, Kosovo, and North Macedonia barely use any gas and have no current import infrastructure.
“As the countries of the Western Balkans grapple with electricity shortages, net-zero ambitions, and aspirations to join the EU, building new gas-fired power plants and gas networks would be a step backwards,” the report notes.