Croatia Renewable Energy

Energy independence and transition to renewable energy sources have become priorities for the Croatian government. The Ministry of Economy and Sustainable Development has been established, putting environmental protection, energy, and climate change under one roof with the economy, entrepreneurship, and trade. The Office of the President of Croatia has established the Energy Transition Council of independent energy experts eager to push for changes.

The electricity generated from solar power accounts in average for 5% in the European Union and only 0.4% in Croatia. To reach the EU average, Croatia would need to add an additional 700 MW to its currently installed 100 MW of solar plant capacity. 

In 2020, the Croatian government introduced a financing model for renewable resources.  The government is paying to electricity producers a variable premium calculated as a difference between their production cost and the market price. Once the market price exceeds the production cost, the premium pay will be abolished.  This model was designed as an interim solution for power plants.  Households and businesses are not yet allowed to sell the excess electricity they produce to the grid.

The Croatian President’s Energy Transition Council has published a list of suggestions for encouraging installment of solar power plants on private homes and commercial buildings. The government has committed to integrate these suggestions into the Law on Renewables and Highly Efficient Cogeneration and the Law on Electricity Market. The legislation changes should be adopted by the end of 2021. Additionally, the government is considering favorable loans to households for installing solar panels.

The EU funding and the Croatian government initiatives will likely result in an increased demand for innovative, reliable, and cost-effective renewable energy solutions in Croatia. We can expect more solar and geothermal power plants, and more production facilities installed by consumers for their own consumption and trade.  This should also result in an increased need for smart grid solutions for electricity stability, exchange, and storage. U.S. companies interested in exploring those opportunities should contact U.S. Commercial Service Croatia at Office.Zagreb@trade.gov for more information and assistance.