North Macedonia has formalized state guarantees and loan agreements totaling €97 million to advance two major energy investments aimed at reshaping the country’s electricity sector. The funding package supports the construction of the Bitola 3 solar power plant and a broad program to modernize existing hydropower facilities.
The Bitola 3 solar project carries a total cost of €87 million, with financing split between a €50 million loan from German development bank KfW and €37 million provided by the European Bank for Reconstruction and Development (EBRD). In parallel, an additional €10 million from KfW has been allocated for the third phase of hydropower revitalization works.
According to the Ministry of Finance, the investments are designed to strengthen domestic electricity generation, improve supply reliability, and support long-term economic stability. The government frames these projects as part of a broader push toward a greener, more resilient, and energy-independent national economy.
The state-owned power utility ESM views the financing as a turning point for both the company and the country’s energy security. Management noted that implementation is progressing rapidly, with procurement underway for new solar facilities at Oslomej 2 and Bitola 1 and 2, while construction continues on the second phase of the Bogdanci wind farm.
Taken together, these initiatives are expected to increase renewable generation capacity by over 200 MW within the next two to three years. The expanded renewable energy portfolio is projected to reduce carbon dioxide emissions by more than 260,000 tons annually. A significant portion of the investment is also dedicated to upgrading hydropower assets. The hydropower modernization program is valued at €47.3 million and will be financed through KfW loans and €10 million in EU grants from the Western Balkans Investment Framework (WBIF). Once completed, the upgrades are expected to boost annual electricity output by around 50 GWh, further reinforcing North Macedonia’s domestic energy base.
