Croatia as an Annex I country of the UN Framework Convention on Climate Change and a country that has pledged in the Annex B of the Kyoto Protocol to reduce its GHG emissions by 5% will have to envisage a new energy strategy. Compared to the energy consumption collapse in some transitional countries, Croatia has passed through a relatively short-term reduction of GHG emissions since 1990 because of higher energy efficiency of its pretransition economy. It is expected that in case of baseline scenario, it will breach the Kyoto target in 2003. Several scenarios of power generation are compared from the point of view of GHG emissions. The cost-effective scenario expects a mixture of coal and gas fired power plants to be built to satisfy the new demand and to replace the old power plants that are being decommissioned. More Kyoto friendly scenario envisages forcing the compliance with the Protocol with measures only in power generation sector by the construction of mainly zero emission generating capacity in the future, while decommissioning the old plants as planned, and is compared to the others from the GHG emissions point of view. The conclusion is that by measures tackling only power generation, it will not be possible to keep GHG emission under the Kyoto target level. The case of including the emissions from Croatian owned power plants in former Yugoslavia is also discussed. (C) 2003 Elsevier Ltd. All rights reserved.