The OECD Development Centre supports developing and emerging economies in their quest for innovative policy solutions to improve people’s lives and promote resilient and sustainable development for all. To that end, it mobilises OECD expertise and builds on evidence-based policy analysis to inform development policy debates within individual economies and internationally.
The report Energy Prices and Subsidies in the Western Balkans: Reforms for a Fair and Green Future aims to identify effective approaches to green transitions that contribute to all dimensions of sustainable development. It supports the economies of the Western Balkans – Albania, Bosnia and Herzegovina, Kosovo*, Montenegro, the Republic of North Macedonia (hereafter “North Macedonia”), and Serbia – in their transition to sustainable low-carbon economies, while emphasising the need to ensure that this transition remains both socially equitable and economically viable.
The report builds on the OECD Multi-dimensional Review of the Western Balkans, which identified the green transition as a shared development challenge for economies across the region. It focuses on how energy-subsidy and price reforms can facilitate the transition to green and sustainable energy systems in the region.
The report hinges around three principles:
Getting prices right and preparing the energy system for low-carbon growth: it maps and evaluates government support for the energy sector, assessing its financial impact.
Supporting people-centred energy transitions through adapted social protection: it uses micro-simulation models to ensure that reforms do not disproportionately affect vulnerable populations.
Understanding the economy-wide impact of reforms: it analyses potential transition scenarios, using macroeconomic models.
The report also integrates a gender-sensitive approach. To ensure its solutions are tailored to the region's specific challenges, it builds on the results of participatory peer-learning and the engagement of policymakers, private sector actors, civil society and other partners.
A multidisciplinary effort, the report draws upon economic, social, statistical, environmental and institutional expertise from across the OECD. It was prepared in close collaboration with the governments of the economies of the Western Balkans and with the financial support of the Swedish International Development Cooperation Agency.