Overview
North Macedonia has adopted a new standalone Law on the Use of Energy from Renewable Sources (“Renewable Energy Law”), entering into force on 10 July 2026.
The Renewable Energy Law brings the key rules governing renewable energy into a single framework and aligns national legislation with Directive (EU) 2018/2001 of the European Parliament and of the Council of 11 December 2018 on the promotion of the use of energy from renewable sources. It replaces the previous approach, under which renewable energy was regulated mainly through the general energy legislation and a broad set of secondary regulations that were not always sufficiently clear or effective in practice.
The Renewable Energy Law is intended to support new investment, reduce the country’s dependence on imported energy and create a more competitive and market-oriented renewable energy sector.
The new framework provides several routes for developing, financing and using renewable energy. These include competitive support auctions, direct power purchase agreements, promotion of the use of guarantees of origin, self-generation, collective consumption and renewable energy communities.
Competitive support and market premiums
The Renewable Energy Law provides for two principal forms of support for renewable electricity projects:
- Feed-in tariffs, which remain available for eligible small power plants and demonstration projects.
- Market premiums, which will generally be awarded through competitive auctions and operate as a two-way contract for difference.
Under this model, where the reference market price falls below the price secured through the auction, the producer receives the difference. Where the market price exceeds the auction price, the producer returns the difference. The mechanism is intended to provide greater revenue predictability for investors while keeping supported projects linked to market prices.
For investors and financiers, the auction rules, qualification requirements, and terms of the market premium agreement will therefore be important when assessing the feasibility and financing of new projects.
PPAs and GOs
One of the most commercially relevant developments is the express recognition of renewable power purchase agreements (“PPAs”), allowing businesses and other buyers to purchase renewable electricity directly from producers.
For investors, a long-term PPA may provide an alternative route to market and support project financing outside public support schemes. For corporate buyers, it may offer greater price predictability and help meet renewable energy and decarbonization targets.
The Renewable Energy Law also further develops the legal framework for the utilisation of guarantees of origin “GOs”) in North Macedonia. GOs are issued in standard units of 1 MWh and may be transferred separately from the electricity itself. They create an additional source of value for producers and a more reliable basis for renewable energy claims by suppliers and corporate consumers.
More opportunities for consumers and property owners
The new framework expands the role of consumers as active participants in the energy market.
Consumer-producers may generate and store renewable electricity for their own needs and sell surplus electricity. The Renewable Energy Law enables collective self-consumption, allowing consumers located in the same residential, commercial or mixed-use building or complex to jointly use a renewable energy installation and agree on the allocation of the electricity produced.
This may be particularly relevant for office buildings, retail facilities, industrial sites and residential buildings where individual generation arrangements are not practical.
The Renewable Energy Law further introduces renewable energy communities, which may bring together individuals, small and medium-sized businesses and municipalities to jointly produce, use, store and sell renewable energy. Their primary purpose must be to provide environmental, economic or social benefits to their members or the local community.
Outlook
The Renewable Energy Law marks an important shift towards a broader and more commercially active renewable energy market in North Macedonia. For businesses, the next step will be to identify which support schemes and novelties of the Renewable Energy Law are most relevant to their projects, operations and long-term energy strategy and can be used to successfully develop renewable energy projects in the country.
FAQ
When does the new Renewable Energy Law enter into force?
The Renewable Energy Law entered into force on 10 July 2026 and establishes a comprehensive legal framework governing the development, financing and use of renewable energy in North Macedonia.
What are the main changes introduced by the Renewable Energy Law?
The law introduces a standalone regulatory framework for renewable energy, including competitive support auctions, market premiums, renewable PPAs, guarantees of origin (GOs), self-consumption, collective self-consumption and renewable energy communities.
Can renewable energy projects be developed without state support?
Yes. The express recognition of renewable PPAs enables developers to pursue commercially viable projects outside public support schemes where commercially viable.
Who can benefit from the new rules?
The new framework is relevant for renewable energy developers, investors, businesses, property owners, residential and commercial building operators, municipalities and other consumers looking to generate, share or purchase renewable electricity.
What should investors focus on next?
Investors should monitor the implementation of the Renewable Energy Law, particularly the secondary legislation governing auctions, qualification requirements, market premium agreements and other implementing rules that will determine how the new framework operates in practice.
The information in this document does not constitute legal advice on any particular matter and is provided for general informational purposes only.
