Danijela Isailović, Manager of the Association Renewable Energy Sources of Serbia gave an interview for the portal Energy and Climate Index. Full interview can be found below:

Serbia is entering one of the most sensitive phases of its energy transition. After several years of strong investor interest in new wind and solar power plants, grid connection has become a key issue for investors, institutions and system operators.

The decision to postpone new grid connection studies for variable renewable energy projects until the 2029–2030 period has opened a broader debate: is this a necessary measure to protect the stability of the power system, or a signal that grid infrastructure and administration are failing to keep pace with investment interest?

The problem is not only technical. At the center of the discussion are also “phantom projects” that reserve capacity without a genuine intention to build, slow administrative procedures, bank guarantees provided by serious investors, and the role of battery energy storage systems as a condition for greater system flexibility.

We discuss these issues with Danijela Isailović, Manager of RES Serbia, an organization that over the past five years has positioned itself as one of the most important voices of the renewable energy sector in Serbia. In this interview, she speaks about the consequences of limited grid capacity, risks to investor confidence, permitting problems, and the messages that Serbia’s experience sends to the entire Western Balkans.

Serbia has postponed the new grid connection studies for variable renewable energy projects until the period 2029–2030. What does this decision mean in practice for investors in wind and solar projects?

– This decision effectively halts the development of new wind and solar projects. Since the grid connection study is the first step in the permitting process, investors will not be able to start administrative procedures until 2030, meaning construction would realistically be delayed until the mid-2030s.

In practice, Serbia risks losing several crucial years in its energy transition, while also undermining investor confidence and future investment in the country. However, an even more urgent issue already exists: many investors that have obtained grid connection studies and temporary grid connection approvals, and have provided bank guarantees, are now facing obstacles in securing construction permits at different administrative levels.

The paradox is that these investors have given bank guarantees to one state institution and committed to building power plants by a certain deadline, while other institutions local, provincial, or national fail to meet deadlines for issuing location conditions, construction permits, and related approvals. RES Serbia estimates that 1.2 GW of projects developed by its members are currently jeopardized by inefficient administration. These investors have provided EUR 29 million in bank guarantees, which now risk being activated for reasons beyond their control.

As Association we submitted Initiative to amend Decree. Firstly, we would like to save project in development which are in risk due to permitting issues. Secondly, we would like to have new grid connections studies before 2029.

Is this measure a necessary step to protect the power system, or does it risk slowing down Serbia’s energy transition and investor confidence?

– If we look only at the numbers, the situation appears simple: there are around 12 GW of connection requests submitted to the transmission system operator, with several additional gigawatts submitted to the distribution system operator. Is that more than enough? Yes. However, recent history tells a different story.

Since 2014, only 824 MW of wind farms and around 400 MW of solar power plants and prosumers have actually been built. So where are the gigawatts? Mostly on paper, in presentations, at conferences, and in press announcements. Without construction and implementation, the power system is not truly jeopardized.

As mentioned earlier, this measure undermines investor confidence and trust instead of protecting system stability. It also slows down the energy transition at a time when energy security and independence are more important than ever.

The measure cannot be seen as a necessary safeguard, because the transmission grid can absorb significantly more renewable energy than is currently connected. In fact, around six times less RES capacity is connected to the transmission system than the system can realistically accommodate. For that reason, there is no justified basis for slowing down serious investors.

In your view, what is the real cause of the grid bottleneck: insufficient transmission capacity, too many speculative projects, slow administration, or lack of flexibility in the system?

– The grid bottleneck is not caused by a single factor; it is the result of several overlapping issues. Some of them are the ones you mentioned, while others are irrational and do not reflect the real situation on the ground.

These include insufficient investment in infrastructure, slow and sometimes discriminatory administrative procedures, and speculative projects that reserve future grid capacity without any genuine intention to build. Together, these problems have created a situation in which serious investors are blocked, even though the system is capable of accommodating more renewable energy capacity.

Several years ago, as an association, we warned about the problem of false investors overwhelming system operators with connection requests, and we advocated the introduction of bank guarantees and stricter criteria. These measures were introduced, and investors provided bank guarantees. In addition, all new projects are now required to include battery storage, which should provide additional security for the transmission system operator. However, we did not anticipate the problems and obstacles that serious investors would later face in obtaining permits.

Serbia has been facing the problem of “phantom projects” occupying grid capacity. Has enough been done to remove non-serious projects from the connection queue?

– Despite the introduction of bank guarantees and the increase in other criteria, the so-called phantom projects still exist on paper. Of course, they are limited to deadline and hope they will not find some grey zone and clarifica

Members of RES Serbia have done a detailed analysis by monitoring all the transmission system construction plans, in which investors have stated the planned years of commissioning, and the result has shown that only 1 out of 20 projects has been implemented in accordance with the announcements, which is a major problem that needs to be solved in the near future. Frivolous projects, despite the measures, continue to congest the system and make it impossible for real projects to be built. 

Could battery energy storage systems help unlock new renewable projects before 2029, and should storage become a condition or an incentive for new solar and wind projects?

– Battery storage is one of the main topics of all professional gatherings of green business and plays a crucial role in the further development of green energy capacities in Serbia and the region. Currently, there are more than 4 GW of requests for the connection of BESS in Serbia and there is no regulatory obstacle for these types of storages not to be further developed soon.

The regulation has obliged investors to provide battery energy storage for new projects, and we expect that the construction of such capacities will begin soon. Some projects have also received building permits with battery storage, such did Fortis Energy, regular member of RES Serbia with SPP Noćaj 1 & 2 with battery storage.

If the implementation of battery storage in the system is accelerated, these plants can lead to greater flexibility of the system, which could therefore integrate more RES projects. Unfortunately, despite mandatory battery storage for new projects, new decree postponed new investments.

How should Serbia balance two priorities: maintaining system stability and allowing serious renewable energy investors to continue developing projects?

– The balance lies in transparency and constant implementation of plans. The system must protect itself from ‘phantom projects’, but real projects and investors who have already invested a lot of resources should not be penalized. Accelerating permitting, investing in grid upgrades, and enabling storage solutions are the key to achieving both stability and growth.

What message does this decision send to the region, especially to Western Balkan countries that are also facing grid congestion and a growing pipeline of solar projects?

– Some countries see this as an opportunity to attract high-quality foreign renewable energy investors from Serbia, while others are concerned that the same model could be introduced into their own regulations. Even more important is how the EU and international financial institutions view this challenge. They are deeply concerned about its potential impact on the continuation of the energy transition process.

Is Serbia temporarily protecting its electricity system, or is it closing the door too early for the next wave of renewable energy investments?

– This looks less like temporary protection and more like prematurely shutting down opportunities. By slowing down proven investors and delaying renewable growth, Serbia risks missing its climate and energy targets, while also exposing its economy to higher costs and CBAM pressures. The country should be opening pathways for green energy, not closing them, if it wants to remain competitive and secure in the years ahead.

Interview conducted by Viktor Andonov

Source: Energy and Climate Index – INTERVIEW: Danijela Isailovic, RES Serbia