Country outlook

North Macedonia has adopted a strategy to transition toward a secure, efficient, and sustainable energy system by 2040. This includes ambitious goals for energy savings, reduced dependence on fossil fuels, and increased deployment of renewable energy sources. Key goals include:

• Achieving up to 51.8% savings in primary energy and 27.5% in final energy consumption.
• Reducing coal consumption and minimising energy losses in the distribution network.
• Strengthening energy efficiency in transport and industry, which are the largest end-users of energy.
• Expanding the use of renewable energy sources, particularly solar and wind for electricity generation.
• Implementing financial support mechanisms such as feed-in tariffs, feed-in premiums, and auctions to promote investment in renewables and reduce reliance on electricity imports.

Impact of Energy Efficiency Regulation on SMEs

A significant part of the strategy focuses on the transport and industrial sectors, which are among the largest consumers of final energy. While current regulations do not directly mandate energy audits or certifications for most SMEs, these businesses are increasingly impacted in several indirect ways:

• Access to financial incentives (e.g., grants or subsidies) often requires proof of energy efficiency practices.
• SMEs operating within supply chains of multinational or EU-based companies are expected to meet higher sustainability and energy efficiency standards.
• Operational costs related to energy use continue to rise, making energy efficiency a financial imperative.
• Participation in public procurement or green certification schemes may also require basic compliance with national energy regulations.

As a result, SMEs are under growing pressure to monitor energy use, invest in efficiency upgrades, and adopt renewable technologies, even without formal regulatory obligations.

Current Regulatory Framework

Mandatory Energy Audits (Article 15 – Law on Energy Efficiency No. 08-1160/1)

Under the Law on Energy Efficiency, updated by the Law on Amendments and Additions (No. 08-4539/1, November 2022), energy audits are mandatory every four years for companies that, during the last two fiscal years, met the following thresholds:

• Minimum 250 employees, and
• Annual turnover exceeding EUR 10 million or total assets over EUR 11 million.

These audits must be conducted by certified bodies approved by the Ministry of Economy and the Energy Agency.

Energy Efficiency in Construction

In line with the Law on Energy Efficiency No. 08-1160/1, published in the official gazette February 2020 and in accordance with Law on Amendments and Additions on Law on Energy Efficiency No. 08-4539/1 from November 2022, all new buildings and significantly renovated buildings must obtain an energy performance certificate before receiving an occupancy permit.

For public buildings over 250 m², this requirement applies regardless of construction date, supporting national efforts to improve the energy performance of public infrastructure.

Renewable Energy Production – Legal Provisions

The Law on Energy (May 2018), together with amendments from May 2019 and November 2022, outlines the framework for renewable energy production:

• Companies must obtain a production license from the Energy and Water Services Regulatory Commission to generate electricity from renewable sources.
• Prosumers (consumers who also produce electricity) are allowed:
  • Up to 6 kW of installed capacity for individuals.
  • Up to 40 kW for companies.
  • They do not require a license, can consume generated power, and feed surplus electricity into the distribution grid.

New Energy Law in North Macedonia: Advancing Toward EU Alignment and a Sustainable Energy Future

North Macedonia has adopted a new Law on Energy aimed at aligning its legal framework with European Union standards. This reform is part of the broader EU integration process and supports the Western Balkans’ reform agenda. The law establishes a comprehensive foundation for a modern, secure, and sustainable energy system, centered on three strategic pillars:

• A significant increase in the share of renewable energy sources in final energy consumption;
• Enhanced energy efficiency and reduction of system losses;
• The development of an open and competitive energy market, with active citizen participation as producers, sellers, and members of energy communities.

Key Provisions and Objectives: The new Energy Law introduces a liberalized, transparent, and competitive electricity market that ensures fairer pricing and broader choices for consumers. It mandates the implementation of smart metering systems, allowing consumers to monitor their electricity usage daily and enabling more accurate measurement and billing. To support the energy transition, the law incorporates innovative concepts such as citizen energy communities and demand-side management models. It seeks to improve market liquidity and expand access to energy resources across the economy, while providing equal investment opportunities for both domestic and foreign stakeholders.

Infrastructure, Investment, and Market Reforms: The legislation addresses infrastructure resilience through incentives for investment in storage systems (including mandatory installation of battery storage for new renewable energy plants) and the digitalization of energy assets. It also strengthens regulatory and operational capacities, sets conditions for regional and EU energy market integration, and facilitates new investments in renewable energy sources (solar, wind, etc.), district heating, gasification, and digitalized grid infrastructure.

Several new financial and administrative obligations are established:

• Investors applying for licenses in energy trading and electricity supply must demonstrate access to at least €100,000 in available funds or fixed assets.
• Electricity system operators are required to notify the Energy Regulatory Authority of each sale of excess electricity.
• Licensed energy entities must report income from each licensed activity separately in their annual financial reports, in accordance with designated activity codes.

To stay updated, SMEs can consult the webpage of the Ministry of Energy, Mining and Mineral Raw Materials.