Renewable energy in the five EU member states in Southeast Europe (SEE) – Bulgaria, Croatia, Greece, Romania and Slovenia, has been the fastest developing branch of the energy sector over the last few years and is poised to reach a new peak, according to the most recent industry report by business intelligence and news provider SeeNext.
The report includes an in-depth financial analysis covering the performance of 2,567 companies in the period 2019-2021, a comprehensive overview of changes in the regulatory framework in all five countries, and information on the key investments and acquisitions in the last few years.
After a spike in the number of newly created renewable energy companies in 2007-2013, 2019 marked the beginning of a new period of acceleration, with one in ten sector companies being set up in or after that year.
The focus of most renewable energy businesses in all five countries is, unsurprisingly, solar and/or wind. In Romania, 83% of renewables companies across the full value chain work in wind and solar energy. In Greece that share is 82%, while in Bulgaria, three quarters of the analysed companies are focused on wind.
The dominance of the two sources is much less pronounced in Croatia and Slovenia, with shares standing at 67% and 59%, respectively. The latter two countries can be considered outliers due to the stronger presence of two other sources of energy in the structure of the national renewables sector. In Slovenia, 34% of all companies engaged in the sector are focused on hydropower versus less than 15% in all other countries analysed by SeeNext. Croatia, for its part, is a leader in the field of biomass and gas from renewables – 24% of all sector representatives registered in the country are focused on bioenergy compared with less than 5% in the rest of the countries in the report.
Another distinct feature of the renewable energy sector in SEE is that it is clearly dominated by local entities – foreign investors own majority stakes in only one in five companies. Italy is the most important source of investment in renewables in the region with 16% of all foreign-owned companies in the sector being in Italian hands. Other countries with strong presence in SEE renewables include Germany, the Czech Republic, Austria, Cyprus and Luxembourg.
The pick-up in pace in the sector is also evident by its financial performance. In 2021, operating revenue jumped 30% year-on-year to EUR 12.9 bln. At the country level, Romania was the largest market with an aggregate operating revenue of EUR 6.6 bln in 2021, or just over half of the revenue of the whole SEE renewables sector. Greece ranked second with an operating revenue of EUR 3.1 bln, while Bulgaria came in third with aggregate operating revenue of its renewable energy sector of EUR 1.3 bln.
In terms of annual growth, the sector’s performance by country varied significantly in 2021. Bulgaria was the fastest expanding market, at a rate of 44% y/y, fuelled mainly by the construction, engineering and project development segment, which almost doubled in size within a year. Romania followed closely with a 41% annual increase in operating revenue. The other three SEE markets advanced at significantly lower rates. While Greece still posted a sound 19% increase, Slovenia and Croatia were far behind at the bottom of the ranking with growth rates of 11% and 7%, respectively.
The expanding headcount of SEE’s renewable energy sector also reflects its successful development throughout the period 2019-2021. At the end of 2021, over 33,400 people were working in the sector or 1,200 more than at the start of the period, with more than half of all employees being based in Romania. Greece and Bulgaria were the two countries with the most significant increase of employment in the sector during the period 2019-2021.