As the consequences of climate change grow more severe, international governments are facing mounting pressure to take decisive and transformative steps toward environmental sustainability. International agreements, such as the Paris Agreement, and recent commitments from COP27 and COP28 have outlined ambitious goals to lower greenhouse gas emissions and cap global temperature increases at 1.5°C above pre-industrial levels. While these frameworks stress the dual necessity of mitigation and adaptation, developing nations often struggle due to limited resources and institutional capacity. In the Western Balkans, nations like Montenegro and Albania are challenged to align economic development with the need to transition away from fossil-fuel-dependent energy systems. This shift demands comprehensive changes in energy policy, governance, and infrastructure. The present study examines the trajectory of the energy transition in this region up to 2021, with a particular emphasis on Montenegro and Albania. It uses a combination of empirical data and a systematic review of academic and policy literature to evaluate the progression from traditional energy sources to renewables, including efforts in hydropower and grid modernization. The central inquiry of this research revolves around identifying the key drivers behind renewable energy development in these two countries and assessing how these factors might provide guidance for similar transitions in other emerging economies. Through a comparative case study approach, this thesis uncovers that political commitment and economic conditions are significant enablers of renewable energy progress. Nonetheless, ongoing obstacles, such as bureaucratic inefficiency and insufficient institutional backing, remain substantial. Despite these issues, regional cooperation and integration offer potential pathways for policy reform and the promotion of long-term, sustainable energy solutions.