Renewables

Biogas power plant in Croatia goes bust due to price controls

Biogas power plant in Croatia goes bust due to price controls

Photo: Thzorro77 / https://creativecommons.org/licenses/by-sa/4.0/legalcode

Published

May 26, 2023

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Published:

May 26, 2023

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Unless the Government of Croatia urgently helps biogas power plant operators, 70% of the capacity will need to be shut down before summer, their association claims. The first unit filed for bankruptcy.

Prices for raw materials for biogas facilities have doubled in the past year, according to Peter Maierhofer, the owner of the NTC Gaj 2 MW unit in Lipik. “Since state institutions responsible for the energy sector did nothing to increase the price of electricity but give empty promises, we weren’t able to pay for raw materials to suppliers and we were forced to close the facility,” he stated.

The biogas power plant in the northeastern Slavonia region came online three years ago. Germany-based North-tec Consult invested EUR 9 million, earlier reports show.

Negotiations were futile

Maierhofer said the firm would have filed for bankruptcy already a year ago if he knew that the price of electricity wouldn’t be raised and that the negotiations wouldn’t be successful.

Croatia has limited power purchase prices for all producers at EUR 180 per MWh. Any additional income is directed to the Environmental Protection and Energy Efficiency Fund. The current measures are set to expire at the end of June.

Of note, the European Commission asked member states to phase out energy support measures to stave off inflation. Energy prices have dropped to the lowest levels in two years, where they were when the energy crisis was just gaining steam.

Biogas plants in Croatia demand bonuses

If the government doesn’t provide help to biogas power plant operators, 70% of the capacity in Croatia will have to be shut by the summer, their association said. Earlier it demanded the sector be exempted from the price cap mechanism and introduce a bonus to avoid losses. The European Union’s REPowerEU plan envisages the expansion of the sector’s capacities to 35 billion cubic meters of biomethane per year, which would completely replace Russian gas imports, the organization pointed out.

The Renewable Energy Sources of Croatia association issued a similar warning in January.

Several units have annulled contracts with the Croatian Electricity Market Operator (HROTE) for feed-in tariffs at EUR 170 per MWh to see if they can survive in the open market. There is 26 MW installed in total in Croatia in biogas-fired power plants. NTC Gaj remained in the feed-in tariff scheme.

Firms controlled by former Deputy Prime Minister of North Macedonia Kocho Angjushev have built a 2 MW biogas power plant

In other news from Southeastern Europe, a 2 MW biogas-fired power plant has just been commissioned in North Macedonia by companies Feroinvest and Central Invest, both controlled by former Deputy Prime Minister Kocho Angjushev, and ASP-PAK and Agria. The investment in Saramzalino in the municipality of Lozovo is worth EUR 12 million.

The facility’s estimated annual power output is 16.6 GWh. The investors said it would also supply heat that can cover six hectares of agricultural land and produce 40,000 tons of fertilizer per year.

German company Wabio Technologie broke ground last month for a 2.4 MW biogas-fired power plant in Nova Crnja in northeast Serbia and said it would build twenty units in the country. The one under construction is envisaged to generate heat as well and produce liquid carbon dioxide and liquid biomethane – LBM or LBG.

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