Republic of Serbia is facing the challenge of tracing the long-term preferred rout of energy sector development, and defining strategic commitments on which this development will be based in the future mid-term period, i.e. by 2030. The requirement set for the energy is to be cleaner, i.e. to largely rely on renewable energy sources and less on exhaustible.

Serbia has considerable sources of renewable energy to satisfy newly established demand. Serbian Government adopted the strategy on how to use this opportunity. In order to stimulate development and investment in this sector, and fulfill commitments undertaken after joining the European Energy Community within the process of EU integration, Serbian Government adopted a set of regulations under the Directive 2009/28/EC on promotion of use of energy from renewable sources, which enable:

• Establishing the “Incentive Tariff” system, where the Serbian Government subsidizes consumption of renewable energy.
• Acquiring status of “Preferential Energy Producer” that uses renewable energy for electricity production.

According to the above stated, it can be concluded that the field of renewable energy in Serbia and the region is an extraordinary potential for investors, both in terms of available resources and return on investment. According to the data presented in the Energy Strategy of the Republic of Serbia, unused available technical hydro energy potential in small hydro power plants is up to 97%, and potential construction projects contain 387MW distributed on 191 locations.

Project development in this field, and in particular small hydro power plants, has been the focal point of JAI team since mid-2012. We successfully participated in realization of 5 small hydro power plant projects with 7MW of total installed capacity. Currently, our team is implementing activities in development of three small hydro power plants with 12 MW of total installed capacity for a reputable German investor.

After the initial assessment of the sites, their hydro potential and the naturally conditioned possibilities for its exploitation, which is carried out in cooperation with the Swiss and Austrian team of consultants, a conceptual solution is made, followed by the preparation of technical documentation. This process entails complex procedure of cooperation with several state institutions and local governments, in order to ensure necessary conditions, consent and permits for construction. Next step is structuring of the project financing in cooperation with commercial banks, followed by a public procurement procedure for supply of equipment and execution of works in a controlled process. Throughout the contracting phase, as well as during the execution of works, there is a constant collaboration with experienced financial monitoring team as well as representatives of the bank that provides project financing. Such project structure, along with engagement of experienced foreign experts in this line of work, enables successful implementation of the project with minimum risks.