ERRA Regulatory Story of the Quarter: ERO’s Redesign of the Renewable Energy Operator for a Sustainable Support Mechanism

The latest ERRA Regulatory Story of the Quarter offers a detailed overview of Kosovo’s* renewable energy support overhaul, led by the Energy Regulatory Office in collaboration with international partners. The reform addresses pressures from market liberalisation, rising renewable adoption, auction-based support schemes, and the increasing complexity of CfD settlements. The former model, based on feed-in tariffs, reference prices, and tariff recovery, became more vulnerable to liquidity mismatches, counterparty risk, and market distortions, especially as prosumer participation grew. Key to the reform is the creation of a ring-fenced Renewable Energy Operator within KOSTT and the conversion of the Renewable Energy Fund into a comprehensive financial mechanism.

(* This designation is without prejudice to positions on status, and is in line with UNSCR 1244 and the ICJ Opinion on the Kosovo Declaration of Independence.)