Alcazar Energy in $200m Montenegro wind farm deal

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• UAE company turns to Balkans
• Montenegro ‘committed to green energy’
• Alcazar to invest up to $600m

Renewable energy investor Alcazar Energy has acquired the rights to a $200 million wind farm in Montenegro as the company turns its focus to investments in the Western Balkans.

The company, which is based in the UAE, said the deal for the 118MW Bijela wind farm represents a milestone in its ambition to build the largest renewable energy platform in the region. Total investments worth $600 million are planned.

Alcazar has entered into a partnership with Simes Inženjering and Sistem MNE, who were the original developers of the project.

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Financial close is expected in early 2025, with construction commencing soon afterwards.

The farm will double Montenegro’s installed wind capacity. 

Daniel Calderon, co-founder and managing director, said that Alcazar’s second investment vehicle, AEP-II, has a particular focus on the Western Balkans as it helps to accelerate the region’s energy transition.

“These countries that have historically relied on coal and/or hydropower as their main energy source provide an opportunity for Alcazar Energy,” he said.

Montenegro and North Macedonia, along with Jordan, Egypt and Turkey, are countries where Alcazar is prioritising investment, he added.

Its Luxembourg-domiciled fund, AEP-II, has raised $337 million of equity and is on track to achieve its target of $500 million. 

About $200 million of this will be deployed in the Western Balkans alongside a further $400 million of profit finance debt, which the company is raising.

Calderon said the Montenegro project would bring affordable, clean electricity to the region and “create long-term local jobs”.     

Bijela forms part of the government’s 2040 national development strategy. It is expected to create more than 800 construction jobs and produce enough clean energy to power 20,700 households annually.

While Europe is seeking to reduce its dependence on gas Alcazar Energy said it is in discussion with several off-takers interested in purchasing the project’s clean electricity.

“We are committed to green energy,” Dritan Abazović, prime minister of Montenegro, said. “I invite foreign investors to continue investing in Montenegro, and the government will be their open and serious partner without any hindrances.”

The Western Balkans consists of Albania, Bosnia and Herzegovina, Montenegro, Kosovo, North Macedonia and Serbia, where Abu Dhabi-based Masdar has also developed the Čibuk 1 wind farm, a 158MW plant that meets the needs of 113,000 homes.

Last month, the UAE and Serbia held talks on establishing a comprehensive economic partnership agreement, paving the way for increased trade and investment flows and private sector collaboration.