Explosion of Investment in Renewable Energy

Records were broken in 2015: renewable energy, according to research, attracted a record $329.3 billion in investments and installed 30 percent more energy capacity using solar and wind than in 2014.

Investment records in renewable energy sources have been shattered. According to an analysis by Bloomberg New Energy Finance (BNEF), this industry attracted a record $329.3 billion in investments in 2015, and 30 percent more energy capacity using solar and wind was installed compared to 2014. Everyone would agree, this is a fantastic result and a step closer to cleaner energy, but where does Croatia fit into this story?

– The European Union has taken a leading role in the world in implementing greenhouse gas emission reductions and has directed its entire policy towards the development of a low-carbon economy. The EU’s targets for 2020 are a 20 percent reduction in carbon dioxide emissions compared to the baseline year, 1990, a 20 percent increase in the share of renewable energy sources, and a 20 percent increase in energy efficiency. When it comes to Croatia, we have met the targets of the Kyoto Protocol. Namely, as early as 2012, we achieved a 17.3 percent reduction in emissions compared to 1990, explains the Ministry of Environmental Protection.

When it comes to renewable energy sources, according to Eurostat’s latest official report for 2014, Croatia is one of the EU countries that has reached the targets set for 2020. The share of energy produced from renewable sources was 27.9 percent (this is a percentage of final consumption). However, Croatia has significant, still underutilized potential for electricity generation from renewable sources. The total capacity of all power plants at the end of 2014 was 4,528 MW. In the system promoting electricity generation from renewable energy sources and cogeneration, 412 MW of production capacity was installed, of which wind farms account for 339 MW or 82.4 percent of the total installed capacity. In the total electricity consumption in Croatia, the share of electricity produced from renewable sources and cogeneration included in the promotion system was 5.51 percent.

– The largest share in electricity generation from renewable sources, apart from hydropower which has been utilized in Croatia for decades, comes from wind farms with about 82 percent. Due to increasingly unpredictable surpluses in the grid that are not matched by appropriate consumption, the limits of safe and reliable acceptance of wind energy into the Croatian electricity system have been reached. Greater utilization of solar energy, from which only 0.2 percent of total electricity in Croatia is currently produced, requires timely investments in electricity infrastructure that will enable a safe and reliable transition to renewable energy sources in Croatia and achieve EU goals. In this, reversible hydropower plants and gas power plants play an important role, explains Andreja Pavlović, senior advisor and partner at Hauski & Partner.

She emphasizes that Croatia has all the natural conditions for building reversible hydropower plants, and due to good connectivity with the EU electricity system and energy transition focused on low-carbon, it is a strategic partner in the optimal utilization of wind and solar energy, which Croatia has in abundance but does not utilize sufficiently.

According to short-term indicators of energy statistics, in December 2015, (net) electricity production was 38.8 percent lower compared to December 2014. In parallel, in the last eight months, there has been a trend of increasing electricity imports, with 56 percent more electricity imported in December compared to December 2014. At the same time, net electricity production from thermal power plants and other sources is increasing. It is time to utilize the natural potentials that can ensure energy independence.