On the 17th of May, Giles Dickson, CEO of WindEurope, delivered the opening speech at the CEE (Central and Eastern Europe) Sustainable Finance Summit in Prague. During his address, he emphasized the untapped potential of wind energy in the region. Currently, the share of wind power in the electricity mix of Central and Eastern Europe falls below the European average of 17%. However, there is a noticeable increase in political backing and a rise in the number of new wind farms being developed across different countries.
Surprisingly, Central and Eastern Europe only accounts for 7% of the European Union's total wind energy capacity. Government targets and support in the region have also fallen below the EU average. Nonetheless, signs of greater political ambition regarding renewable energy are emerging throughout the area. Moreover, there is a significant level of project development activity led by local and regional developers, with many showing willingness to pursue merchant ventures or power purchase agreements (PPAs) if necessary.
Romania and Serbia have plans to initiate Contracts for Difference (CfD) auctions for onshore wind projects later this year. In addition, Romania intends to introduce a legal framework for offshore wind and commence offshore auctions as soon as possible. Both Slovakia and Czechia have enacted legislation for CfD auctions. Lithuania is currently constructing numerous new onshore wind projects, while Estonia and Latvia have several onshore projects in the development phase. All three Baltic States hold ambitious plans for offshore wind farms, both for domestic use and export. Lithuania has already initiated its first auction for offshore wind.
Poland, although disappointed by reducing the required distance for onshore wind projects from 10 hours to only 700 meters, considers this a step in the right direction. They continue to develop onshore wind projects and hope that the 700-meter rule is not the final outcome. Offshore wind energy in Poland is progressing rapidly, with the expectation of the first projects being built by 2026-27, and final investment decisions scheduled for this year.
In Bulgaria, at least two major regional developers are actively pursuing onshore wind projects. The government is prepared to provide support once grid capacity becomes available, alongside the implementation of auctions, contingent on the formation of a coalition with a parliamentary majority.
Even Slovenia, with only 3 MW of wind energy capacity and strict restrictions on the placement of wind farms, is seeing ongoing project development.
All the aforementioned countries have come to recognize that wind energy is cost-effective and contributes to enhancing energy security. According to the think-tank Ember, expanding wind capacity in the region could potentially reduce electricity prices by almost a third. Many of these countries also anticipate benefiting from the development of local wind supply chains. Furthermore, public opinion is largely in favor of expanding onshore wind projects, with three-quarters of Poles supporting the establishment of wind farms near their residences.
The revision of the European Union's National Energy and Climate Plans (NECP) for this year is likely to result in increased wind energy targets for 2030 across Central and Eastern Europe. For instance, the Romanian Government intends to raise its 2030 target for renewable electricity from the current NECP level of 30.7% to a range between 34% and 38%.
While Hungary and Czechia are primarily focusing on nuclear energy, both Poland and Romania recognize the importance of incorporating both nuclear and wind power into their energy strategies.
Simplifying the permitting process remains a significant challenge for all countries in the region, particularly regarding the implementation of new EU regulations. This issue, however, is still pending for most governments across Europe.
Grid expansion is another major hurdle faced in the region, as it is in other parts of Europe. Transmission System Operators (TSOs) need to adopt a more flexible approach when awarding grid connection permits.
A key concern will be to assure Central and Eastern European governments and project developers that the European supply chain is capable of meeting the demand for increased wind farms. Chinese manufacturers have already secured orders in Croatia, Romania, Serbia, and Bosnia, and they are now targeting the Balkans as an entry point to the European market.
For a long time, we have discussed the potential of Central and Eastern European markets. The growing support from governments and the increasing level of project development in the region demonstrate that this potential is now being realized. These developments present significant opportunities for the European wind industry.
