In Southeast Europe, the hydropower sector is experiencing a paradox of extensive feasibility studies that yield little in terms of actual project development. Despite the technical advancements in planning and analysis, significant hydropower projects remain unrealized. This situation is not attributed to a lack of resources or expertise but rather to a systemic inertia where analysis replaces decisive action, leading to deferred responsibilities and risks.
The region’s rivers, including the Drina, Morača, Neretva, and Vrbas, frequently appear in planning documents, with recalibrated installed capacities and updated cost estimates. For large hydropower schemes, capital expenditures typically range from €2–4 million per MW, while run-of-river projects are estimated at €1.5–2.5 million per MW. However, the crucial steps of securing permits, financing, and initiating construction are consistently postponed.
The Upper Drina cascade exemplifies this trend with its potential capacity of 400–450 MW and annual production estimates between 1.6–1.8 TWh. The total investment required is projected at €900 million to €1.2 billion, yet governance issues and environmental liabilities continue to hinder progress. While the project’s strategic importance is recognized, no single entity is willing to bear the long-term risks associated with its development.
Similarly, Montenegro’s Morača and Komarnica projects illustrate the recurring cycle of analysis without commitment. The Morača cascade has been under review for over two decades with a capacity of 230–250 MW and an annual output of 700–800 GWh, requiring an investment of €600–800 million. The Komarnica project, although smaller at 170–180 MW, follows a parallel path where environmental considerations consistently alter project viability without reaching definitive conclusions.
Bosnia and Herzegovina’s Upper Neretva and Vrbas projects further highlight how repeated feasibility assessments can undermine financial viability. With combined capacities of 300–350 MW on the Neretva and 150–200 MW on the Vrbas, these projects promise an annual output of 1.2–1.4 TWh, necessitating investments between €1.0–1.3 billion. The continuous balancing act between environmental concerns and economic returns results in technically feasible but financially inconclusive projects.
The Ibar cascade in Serbia presents another instance of stagnation with an estimated capacity of 100–120 MW and annual generation around 400 GWh. Despite being promoted as a catalyst for regional development, unresolved land ownership issues and local opposition have led to repeated feasibility announcements rather than progress toward construction.
Northern Macedonia’s Cebren and Galiste projects on the Crna Reka reflect a broader systemic issue. With a combined capacity of 330–350 MW, these projects require an investment between €700–900 million. Each new public investment model or concession proposal resets the feasibility process, delaying accountability for associated risks.
Even in Albania, where hydropower constitutes a significant portion of energy generation, similar patterns emerge. Studies for potential capacities ranging from 300–400 MW in the Vjosë basin have been conducted prior to its protection status being granted, while smaller projects continue to undergo re-evaluation amid regulatory uncertainties.
This trend underscores a critical issue: feasibility studies are serving as a mechanism to preserve option value while diffusing responsibility across multiple stakeholders. The inherent risks associated with large hydropower projects—such as substantial capital commitments over extended timelines—demand political stability and financial resolve that short-term institutional cycles often fail to provide.
The current state of hydropower development in Southeast Europe reflects a rational equilibrium where extensive studies generate alignment without leading to actionable outcomes. Until there is a shift in how governments and regulators approach feasibility—transforming it from an indefinite phase into one that culminates in binding commitments—the region will continue to optimize its river resources on paper while facing an aging energy infrastructure.
This situation highlights an institutional failure rather than an analytical one; as long as there is a reluctance to confront risk ownership directly, Southeast Europe’s hydropower potential will remain largely untapped.
