Development of a sustainable bioenergy market

Project description

Title: Development of a sustainable bioenergy market in Serbia
Commissioned by: German Federal Ministry for Economic Cooperation and Development (BMZ)
Co-funded by: European Union
Country: Republic of Serbia
Leading executing agency: Public Investment Management office
Overall term: 2018 to 2021


Serbia has committed to generating more than a quarter of the energy that it consumes from renewable sources by 2020. The country has significant potential to use biomass from agriculture and forestry for energy purposes. The public and private sector has a strong interest in using bioenergy to produce heat and electricity. However, the current legal framework is only partly conducive to the development of a sustainable bioenergy market.


The general conditions, expertise and resources required to promote the sustainable use of bioenergy have improved; this contributes to rural development and to greenhouse gas mitigation.


The programme advises ministries and authorities on eliminating regulatory barriers and on adapting to EU-compliant regulations on the sustainable use of biomass. Training courses and networking events help to improve the expertise of political decision-makers.

A bioenergy partnership between Serbia and Baden-Württemberg was established in 2014. This partnership focuses on political dialogue between Serbian and German sectoral ministries, cooperation between companies on investment projects and joint scientific research. A large number of events in Brussels, Stuttgart and Belgrade help political decision-makers to network and share information and knowledge.

The programme works in close cooperation with KfW Development Bank to promote the creation of sustainable biomass supply chains to district heating plants in selected regions of Serbia. Replacing fossil fuel sources with agricultural and forest residues cuts greenhouse gases and enhances energy security. The programme advises companies along the biomass supply chain and assists in the development of these chains for district heating companies.

With funding from the EU programme Horizon 2020, the programme formed an international consortium to establish regional biomass logistic and trade cetres in three countries in South-East Europe. Forestry companies, local energy agencies, municipalities and financial institutions are receiving advice and training on setting up these trading centres for biomass.

The programme supports public authorities and private investors in introducing biomass heating in public buildings and implementing biogas projects. This serves to demonstrate the economic and technical feasibility of biomass as an energy source and encourages its increased use. Partnerships between German and Serbian businesses are fostering technology transfer and helping to break down barriers to investment.

The programme is providing households in two pilot regions with recommendations on how to use firewood more efficiently and make cost savings as a result. It is also working on conditions that will encourage producers to manufacture and distribute more efficient wood-burning stoves.


Cooperation agreements for developing sustainable biomass supply chains have been concluded with13 district heating companies. The planned biomass needs of these plants are equivalent to a heating value of approximately 345,000 megawatt hours per year. This can result in CO2 reductions of about 134,000 tonnes annually.

The recommendations on cost-efficient use of fuelwood and energy-saving stoves have reached more than 7,500 households since the awareness-raising campaign was launched. These recommendations can help to reduce air pollution in living quarters and conserve forest resources.

25 designs for bioenergy demonstration projects have been prepared with key stakeholders from industrial, tourism and agricultural enterprises and presented to potential investors as a basis for decision-making. These demonstration projects play a vital role in building up skills and knowledge in the region. They can be adopted by private investors and public institutions and used within the scope of potential government programmes.

The Serbian biogas market is attractive in the long term in terms of its biomass potential and the use of biogas. The programme will support the emerging increase in biogas plants brought about by the new feed-in tariffs. Interest among Serbian and German private companies in investing in bioenergy projects in Serbia has risen.

At the regional level, the broad political dialogue is also supporting alignment of the general conditions for bioenergy with EU standards in neighbouring countries in the Danube region. One outcome has been the creation of a regional bioenergy platform. Working together with the programme, the platform coordinates joint policy advice from donors and committed stakeholders in Balkan countries.

Additional information