Axpo Group has signed a long-term power purchase agreement (PPA) for renewable energy, the very first one concluded on market terms for the offtake of electric energy produced from renewables in Serbia. The deal has been signed with IVICOM Energy doo Žagubica, a renewable energy project co-owned by Serbia’s MK Group and Slovenia’s ALFI Green Energy Fund.

They will support the ongoing construction of the 105 MW wind farm situated 150km east of Belgrade, in Krivača. It will feature 22 turbines, each with a capacity of 4.8 MW. As of January 2024, the wind farm is supposed to begin producing enough green power for more than 75,000 households, saving 115,000 CO2 emissions annually, and becoming a true milestone for the energy transition in Serbia.

The deal was implemented in close co-operation with the banking consortium, consisting of banks members of Raiffeisen, Erste, and NLB groups, as well as OeEB, which provided financing for the project worth EUR 155 million. It is the first wind farm in Serbia and the Balkans to be financed on the basis of a private power purchase agreement.

Axpo Group is Switzerland’s largest producer of renewable energy and an international leader in energy trading, with decade-long expertise in renewables. The company already has a strong presence in the SEE region, with offices in Albania, Bulgaria, Croatia, Greece, Romania, and Serbia, offering services in power and gas supply, energy trading, and green certificates.

Our Partners Maja Jovančević Šetka and Petar Mitrović, together with the rest of the team including Associate Dimitrije Ilić, and Senior Associate Katarina Tomić, advised Axpo Group on this transaction, which is expected to advance the energy transition and is a landmark deal for the country.

Maja noted that this project constitutes an important precedent for further development of the Serbian renewables market. “We are thrilled to see the first private PPA as well as project financing for a wind farm based on it successfully closed in the Serbian market and congratulate all participants. The fact that both physical and financial PPA are now in place and have met bankability conditions is proof of the growing maturity of the market and the regulatory framework. We are grateful to Axpo for awarding us the opportunity to support the transaction.”

Petar added that this assignment marks the continuation of Karanović pioneering work in the renewables sector in Serbia – “We thank Axpo for trusting us with this important deal. We see this as a recognition of our efforts to support the implementation of pioneering solutions in the Serbian energy sector, following our work on the creation of the first bankable legal framework and PPAs that contributed to the realization of the first large-scale wind projects in Serbia during the last decade. Congratulations to Axpo and all the parties involved in this landmark endeavour.”

7th February 2023