The energy transition in the region requires a combination of public and private capital, as well as a stable regulatory framework – this was the conclusion of the panel “Financial Challenges of the Energy Transition” held at the 41st International Conference “Energy 2026” on Zlatibor.
The central question of who should finance the energy transition was the focus of a discussion involving representatives of government, power utilities, financial institutions, and the banking sector.
Public Capital as a System Guarantee
Advisor to the Minister of Mining and Energy, Aleksandar Zlatković, stated that the public sector does not have the capacity to finance the energy transition alone, but its role remains crucial as a catalyst for investments.
He emphasized that the key issue is mobilizing private capital, which should be the main investment driver, while public capital serves as a system guarantee, and international institutions play a role in reducing risks.
Priority, he said, must be given to supply security and projects that bring system stability, such as the Bistrica pumped-storage hydropower plant and 1 GW solar projects.
Speaking about the most realistic financing models in the coming years, EPS AD’s Executive Manager for Finance, Milan Laković, stressed that projects must be sustainable, both technically and financially, in order to attract investors.
He added that decarbonization is a process that must involve all stakeholders, and that the green transition requires broader participation of the commercial sector, along with the development of public-private partnership models.
Referring to CBAM, he noted that this mechanism should not be seen as an obstacle, but rather as a stimulating measure that encourages faster investments in good-quality renewable energy projects.
Energy Revolution
EPCG’s Executive Director, Zdravko Dragaš, said that the company has invested heavily in renewable energy development, highlighting that more than 66% of Montenegro’s electricity production comes from renewables.
– We have entered the era of energy transition, I call it a revolution. Ready or not, we must participate. The time of electricity production from fossil fuels is coming to an end – Dragaš declared.
He stressed that large investments are necessary, but must be carefully considered as they represent long-term strategic decisions. Regional cooperation and joint projects, especially in hydropower, are key for sustainable development, since individual energy investments are becoming increasingly difficult to implement.
Hybrid Financing as Optimal
Bodin Bulatović, IFC’s representative for Serbia and the Western Balkans, assessed that combining public and private capital is the most effective model for developing energy projects.
He explained that the role of development institutions is not to fully finance projects, but to enable all participants to compete in the market.
He emphasized that without the public sector, large projects cannot be realized, but private capital should have as much involvement as possible.
Serbia and the Region Lack Corporate PPAs
Nikola Stamenković, Member of the Executive Board of Erste Bank Serbia, noted that the bank’s green portfolio amounts to 300 million EUR, with such projects making up more than 15% of the total portfolio.
He reminded that the era of feed-in tariffs is over, and pointed out that Serbia and the region lack corporate PPA agreements. In Europe, over the past four years, these agreements accounted for 80% of all off-take strategies.
– As a region and market, we are relatively small. The domestic private sector is not keen on entering long-term fixed-price contracts. One reason may be that there has been more trust in the visible hand of the state than in the invisible hand of the market. We also believe the legal framework could be simpler – Stamenković concluded.
