Energy efficiency financing strategies and obstacles for residential public buildings in the Balkan region

Abstract

The energy efficiency represents an international and multi-faceted phenomenon. It is especially important in the countries belonging to the Balkan’s region of the Southeastern Europe (SE). The research problem addressed in this paper focuses on the improvements in the inherent energy inefficiency by the means of quality financing of investment arrangements. This paper utilizes detailed literature review of multi-faceted sources, journal articles, private and government publications. Furthermore, the obstacles to attracting viable sources of private financing shall also be researched and addressed. Semi- developed and still developing Balkan countries have been experiencing severe lack of diversified financial instruments. The financial risks, energy poverty and low incomes, lack of appropriate understanding of the market and the absence of the appropriate regulatory framework have been identified as the major obstacles to attracting viable private financing. There are several issues impacting the attraction of private financing arrangements. These barriers could be summed up as the lack of appropriate regulatory framework, deficiencies in the proper market understanding, inherent presence of energy poverty and low incomes, multitude of financial risks, lack of skilled human resources, the presence of the so-called split incentives and fragmentation issues in common decision-making process. The so-called multiple benefits approach (MBA) to energy efficiency investments tend to widen the energy efficiency perspectives beyond the traditional measures of reducing energy demand and lowering greenhouse gas emissions. This approach looks into multiple spheres by assessing multitude of different benefits to stakeholders. In conclusion, the big disparity in size and variety or financial supporting instruments between the EU members and non-member states must be addressed and reduced.