The Ministry of Economy and Sustainable Development plans to hold auctions for large renewable energy projects, including wind farms and solar power plants, in the second half of the year, most likely in the autumn, as well as another auction for small-scale projects, according to state secretary Ivo Milatić.
He said the goal of the Draft law on the electricity market, which is currently under public consultation, is to speed up the implementation of projects in the renewable energy sector, so the deadline for their completion will be five years.
The Ministry has prepared the Draft law on the electricity market to speed up the implementation of projects
“We plan to have a big competition for premiums in the second half of the year, but not over the summer. The autumn is likely the time for the auction to take place,” Milatić said at today’s online panel discussion organized by the Renewable Energy Sources of Croatia (RES Croatia)
Maja Jurišić, project manager at Island Movement, Ugo Toić, from the OTRA agency, and Hrvoje Prpić, President of Croatian EV Drivers Association Strujni krug, also participated in the discussion, while moderator was Maja Pokrovac, Managing Director at RES Croatia.
Minister Tomislav Ćorić said earlier that a quota of 400 megawatts (MW) will be distributed at the first auction for large-scale projects. At the end of last year, Croatia introduced auctions for the allocation of premiums and feed-in tariffs for projects with a capacity of less than 2 MW, and the first auction saw subsidies approved for 25.5 MW.
Ivo Milatić: The most important thing is to set the transition switch well, to define good models
Milatić pointed out that there is no doubt electricity will be the most important fuel in the future, among other things due to the electrification of transport, so with the increasing demand there will be more and more green energy on the market, which will reduce the need for subsidies.
The most important thing now is to set the transition switch well, to define good models, and the further development will be much easier, he said.
Energy approvals for green power plants will be valid for five years
Maja Pokrovac, from RES Croatia, asked the state secretary to comment on investors’ objections raised during the public consultation on the Draft law on the electricity market, which envisages a period of five years for receiving key permits for renewable energy projects such as environmental permit, and grid connection permit.
They are concerned that the deadline is too short, considering that it takes about 3-5 years to make an environmental impact assessment, and there is also the development of the project, and financing, Pokrovac said.
Croatia will not meet its green energy targets if projects are delayed
Milatić said that the position of the ministry is that if a precondition for obtaining an energy approval is a valid spatial plan, then five years is enough to get a building permit. This means that the energy approval will be valid for five years.
If it is extended to six, seven years, then Croatia will not succeed in achieving the set goals, so the idea is to concentrate investments on locations where projects can be implemented, he added.
The Draft introduces a spatial plan as a condition for participating in auctions and for issuing an energy approval
There was also a request to remove a spatial plan as a condition for participating in auctions and for issuing an energy approval. If this request is granted then it will mean nothing has changed compared with the current situation, and that project implementation will be delayed for years, Milatić said.
The intention is to force local governments to better prepare spatial plans, because now there are cases where investors have managed to include certain projects in those plans, even though there is no sufficient power infrastructure or the environment is endangered, and then problems arise when the ministry has to issue permits, explained, Milatić.
Biogas will be encouraged only if it solves climate problems in agriculture
The state secretary pointed out that in parallel with the auctions for big projects, an auction for small-scale projects is being prepared.
The state intends to increase the quota for geothermal, which was set at 20 MW for the first small auction, but was not distributed.
Installing a 1 MW geothermal power plant requires a EUR 5.3 million investment
The quota increase is an option, but there are no projects that are ready for implementation, he said, adding that geothermal power plants cannot be built without premiums given the necessary CAPEX, which is EUR 5.3 million for 1 MW.
On the other hand, biogas will be incentivized only if it solves climate problems in agriculture.
So the conditions for such projects will be more strict in order to achieve this, he said.