Part of the country's Just Energy Transition Investment Platform, first reported by Reuters last year and launched at the COP28 climate talks in Dubai, the investment will see the country stop using the climate-damaging fuel by 2030.
The plan is expected to generate at least $591 million in funding from lenders including the European Bank for Reconstruction and Development (EBRD), the World Bank Group, and others in the public and private sectors.
The CIF funding will be channelled through its $2.2 billion Accelerating Coal Transition (ACT) investment programme, a multilateral platform that offers concessional finance to help middle-income countries move away from fossil fuels.
"The program will help unlock investment at scale for Macedonian clean energy, infrastructure and human capital, with powerful demonstration effects for our economy," Macedonia's Prime Minister Talat Xhaferi said.
By ditching 824 megawatts of coal-fired power at the Bitola and Oslomei power plants, the country will save more than 13 million tons of carbon dioxide emissions by 2038. Coal mines totalling 2,707 hectares will also be reclaimed and restored.
"This pioneering plan marks a milestone for CIF's Accelerating Coal Transition investment program. To deliver for climate, we need a rapid and just transition away from coal," said CIF Chief Executive Tariye Gbadegesin.
The CIF funding will also help enable 400 megawatts of renewable energy and 100 megawatts of energy storage, it said, while the government would also invest in retraining and other support for around 3,000 people.
"The support from Climate Investment Funds is critical to address market barriers and unlock private sector financing, needed to deliver on North Macedonia's ambitious climate targets," said Harry Boyd-Carpenter, managing director of climate strategy and delivery at EBRD.
By offering low-cost lending, CIF is able to see its money draw in multiples of its original investment, and in the case of North Macedonia, expects almost $7 dollars of additional co-financing for each dollar it puts in.
