Around 40 renewable energy projects are pending in Croatia at the moment, according to the Croatian Chamber of Economy (HGK). Power grid is the biggest challenge, which could jeopardize connecting new power plants to the system but also the operation of the ones already online, it said.

The recent announcement by a significant foreign investor that it is leaving Croatia doesn’t indicate the situation would improve anytime soon, the Croatian Chamber of Economy said. Namely, Norway-based Statkraft said a month ago it would divest of its assets in Croatia.

The country has laws, but implementation is lacking, said HKG’s Director of the Industry and Sustainable Development Sector Marija Šćulac. Another issue, in her words, is that the regulatory framework isn’t harmonized, looking at various ministries and institutions.

Sometimes one gives the green light while the other asks for additional requirements, slowing down the process, she added.

Šćulac: The system is in a standsill

As for challenges in project financing, lack of funding sources or unfavorable conditions for investment often come to mind.

However, investors in Croatia face a unique problem – uncertainty about basic costs, such as the price of grid connection, which hasn’t been determined since 2022, according to Šćulac.

Uncertainty slows down the development of the entire sector, which is why the system is in a standsill, she said at the Better Energy conference.

She stressed the biggest challenges are related to the power network and highlighted the capacity, obsolescence, and issues in financing modernization.

More than 50% of the transmission system has exceeded its operational lifespan

More than 50% of the transmission system infrastructure, Šćulac noted, has exceeded its operational lifespan. At the same time, the National Energy and Climate Plan (NECP) foresees the integration of an additional 4,800 MW of renewables by 2033. She expressed the view it requires urgent investments and pointed out that the sum secured so far is far below the EUR 2.3 billion level determined in the NECP.

Grid upgrade and stabilization plans exist, but they get executed too late, according to her. Croatia could find itself in a situation where even operational projects won’t be able to produce energy at full capacity, Šćulac stressed.

She underscored it is necessary to create conditions for a more flexible integration of renewables, using energy storage and distributed generation.

The sector’s further growth and reduction of the dependence on electricity imports aren’t possible if the issues aren’t solved, Šćulac asserted.

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