RES projects face regulatory halt

The RES Croatia Association warns that deadlines for the construction of facilities generating electricity from renewable energy sources are expiring and claims that all permits for construction cannot be obtained, and that the system for obtaining location building and usage permits for existing RES projects has been halted.

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According to the Association, it is becoming likely that within the legally prescribed deadlines, it will not be possible to build a power plant.

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It is noted that connection to the electricity network represents one of the bottlenecks for the development of RES projects, and that a crucial factor for initiating a new investment cycle is the decision on the amount of the fee for connection, which falls under the jurisdiction of the Croatian Energy Regulatory Agency (HERA) and is determined according to the Methodology for determining the fee for connection to the electricity network.

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The decision was announced, according to the Association, to be made by the end of last year, but it did not happen. The consequences of this will be multiple. Currently, due to the unknown connection price, the development of new production facilities from renewable energy sources in Croatia is completely blocked, and all projects are practically on hold. Due to the aforementioned delay, investors cannot initiate the process of preparing the elaborate optimal technical solution for connection and obtain a connection agreement, or energy approval, which are all prerequisites for obtaining other necessary permits (location and construction permits) for the development of RES projects.

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RES Croatia considers it particularly problematic that investors are obliged to obtain all permits and build the plant within seven years, or five years for projects that have obtained energy approval, which is the validity period of the energy approval, with no possibility of extending that deadline.

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They conclude that due to the failure to make a decision on the amount of the fee for connection to the network, investors cannot continue the further development of projects, while at the same time, the deadline for the construction of the plant is running out, making it likely that they will not be able to build a production plant and obtain an operation permit within that timeframe.

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The Association emphasizes that investors will not be able to submit a valid location permit within three years from the date of enforceability of the energy approval because the entire process is blocked.

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They remind that the energy development strategy until 2030, with a view to 2050, envisages successful construction of as many RES plants as possible to increase the share of RES in direct energy consumption to 42.5 %. Similarly, in order for the electricity network to be able to ensure the connection of new RES facilities, it is necessary to urgently build key infrastructure, namely a new 400 kV transmission line from the Konjsko substation to the Melina substation.

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