September 25, 2023 | Monday

A New Era of Energy Efficiency Subsidies

In a landmark move designed to promote energy efficiency and bolster the use of renewable energy in Kosovo, while also improving the social well-being of its inhabitants — an initiative supported by the European Union — the application for the comprehensive subsidy package was officially opened on August 18, 2023. Kosovo’s Ministry of Economy announced this subsidy package for families willing to invest in energy-efficient home appliances and solar water heating systems.

“The EU’s support in this initiative underscores our mutual commitment to sustainable development and social inclusion,” said Alessandro Bianciardi on the day of announcement, illustrating the European Union’s integral role in this progressive move.

As part of the larger Energy Support Package backed by the EU, the new subsidy package has been crafted to alleviate the financial strain on households, making vital household appliances and utilities more accessible and aiding Kosovo in its pursuit of a sustainable, green transition.

The subsidized items include washing machines, dishwashers, refrigerators, and even solar systems designed for heating sanitary water. While the package is open to the general public, there is a special emphasis on aiding financially vulnerable groups. Specifically, self-supporting parents and citizens who are beneficiaries of categories I & II social assistance schemes stand to benefit the most from these new measures.

For washing machines, while a standard subsidy of 200 Euros is available, single mothers and those on social assistance will receive higher subsidies of 300 and 400 Euros respectively. Dishwashers are subsidized at 150 Euros generally but rise to 250 and 300 Euros for the self-supporting and socially assisted categories. Refrigerators or freezers are subsidized at 100 Euros for the general population, with an increase to 150 and 200 Euros for the targeted vulnerable groups.6

In line with the focus on social inclusion, the support for disadvantaged groups was specifically lauded by the Single Parent Association. They described the measure as crucial for self-supporting parents, particularly single mothers, who usually bear the full burden of childcare and are often excluded from similar policy measures.

With EU support, the Ministry also aims to encourage the use of renewable energy systems, specifically solar water heating systems. For this, 40% of the investment value for a new solar water heating system will be subsidized, up to a maximum of 1000 Euros.

This initiative has been lauded as an excellent example of how energy policy can be harmonized with social welfare goals. By providing higher subsidies for those in more precarious financial situations, the scheme ensures that the drive toward energy efficiency and renewable energy usage in Kosovo is inclusive.

August also saw the launch of another significant energy subsidy program, supported by the EU. More than 2,000 households will have the opportunity to insulate their homes, thanks to a financial contribution of 10 million euros from the EU, aimed at creating a greener and more energy-efficient Kosovo.

Citizens could apply for subsidies that cover up to 45% of the cost of external wall insulation, roof insulation, and the replacement of exterior doors and windows, capped at 5,500 euros. This initiative represents the first-ever energy efficiency scheme specifically designed for the residential sector by the institutions of the Republic of Kosovo. The program is administered by Kosovo’s Fund for Energy Efficiency.

As winter nears, the urgency for these energy efficiency upgrades intensifies, offering the people of Kosovo both cozier homes and a smaller carbon footprint. These initiatives are part of the EU’s decisive response to pressing needs, with the rapid allocation of a notable EUR 75 million from its substantial EUR 1 billion Energy Support Package for the Western Balkans.

This package, a decisive counteraction to the skyrocketing energy prices in the aftermath of Russia’s unexpected aggression towards Ukraine, earmarks substantial funds to combat the prevailing energy crisis in Kosovo and its neighboring nations.

Diving into the specifics, a hefty EUR 25 million from the package will directly cushion energy expenses and advocate for the integration of alternative heating, encompassing wood and pellet, targeting approximately 200,000 households. 

Further highlighting the EU’s dedication to sustainable energy, an additional EUR 15 million had served as an incentive, providing households with a subsidy equivalent to the energy savings they had achieved compared to the previous year. This approach was set to benefit approximately 160,000 households.

The remaining EUR 35 million is earmarked for pivotal long-term projects: thermal insulation enhancements for 12,000 households, energy-saving appliances for an additional 10,000, and the integration of 1,000 MSMEs into the renewable energy sector, with a special focus on solar panels.

As Kosovo’s largest trading partner, the EU continues to be the primary financial benefactor for Kosovo. Through the Instruments of Pre-Accession Assistance (IPA) I and II, the EU has invested EUR 1.2 billion in the country, a commitment that is being sustained with IPA III.