Driven by rising prices and a potential energy shortage, consumers are increasingly deciding to become energy producers from renewable sources. Solar panels (small power plants) reflect on the roofs of family houses across Croatia, and some have even placed them in their yards. Small electricity producers, whose plants have a capacity of up to one MW, produce it for their own needs, and sell the surplus to HEP. This is how Dubravko Posavec, the owner of Solida grupa from Ivanec, started, whose foundations were laid in 2012 on the roof of his family house in Cerje Tužno. Over the years, Posavec has transformed from a small producer of energy from solar panels into the second-largest producer in the country, with only HEP ahead of his Solida grupa.
At the end of January this year, nearly 7500 solar power plants were connected to the HEP ODS distribution network, of which 4647 solar power plants were installed in households, with a total capacity of 28.353 MW, of which 4243 were in the self-supply category, with a capacity of 25.63 MW. Electricity from small producers (plants with a capacity of up to 1 MW) within the HEP group is purchased by HEP Elektra as a regulated supplier in public service and HEP Opskrba as a market supplier. Currently, HEP Elektra purchases electricity from solar power plants from about 1100 customers using self-supply facilities and from about 140 customers with their own production at regulated prices set by HERA. HEP Opskrba currently purchases electricity from about 5700 small producers. The purchase price is defined by bilateral contracts and depends on the categories of producers.
The Path to Energy Production
According to Daniel Srb, a consultant and director of DSconsulting from Osijek, although there are other technologies for using renewable energy sources for personal needs, the dominant technology among small producers is the production of electricity from photovoltaic systems, and Croatia ranks 26th in the European Union in their usage, with 16.9 W installed per capita.
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If the price of electricity and gas were higher, investing in the use of renewable sources would be more profitable
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– If Croatia reached the EU average level of 254.5 W per capita in the use of PV systems, it would completely solve the need for electricity imports – emphasizes Srb, adding that the problem is the lengthy procedure for obtaining the necessary documentation.
The process begins with the development of a project, then a notice of the possibility of connection is obtained from HEP, and based on it, the main project for the installation of the plant is created, while HEP simultaneously installs a bidirectional meter. After the completion of the works and the submission of seven documents, HEP issues a certificate for permanent operation.
– The problem is that HEP is not prepared for a large number of requests for the installation of PV systems, and in some parts of Croatia, each HEP move is waited for months. But there are also good examples, for instance in the Osijek-Baranja County. This shows that there is no adequate way to encourage the use of photovoltaic systems, and there are clearly systemically embedded brakes – explains Srb, who claims that the problem can be solved by HEP, or rather political influence on that company.
Unjustified Limitations
According to him, a sustainable system for accepting and paying for produced electricity is needed. Although HEP’s model of taking over surpluses up to the limit of annual electricity consumption yields initial results, there is no reason for family houses with a single-phase connection of 5.5 or 7.5 kW to have the power of the photovoltaic plant limited to 3.6 kW.
– We have administratively limited electricity production in the mentioned cases, which has no technical justification. Another limitation is the annual electricity production from the PV system up to the level of annual consumption. That decision also makes no sense. Justification was sought in taxing income from sold energy, which was resolved at the beginning of this year, allowing an annual income of up to 1327.22 euros per household, but HEP has not changed its own model to enable that – notes Srb.
He further explains that current electricity prices are such that co-financing of photovoltaic plants is no longer necessary. The highest achieved purchase prices for electricity were at the end of September last year, reaching 4.3 kuna/kWh (0.57 euros/kWh). Since then, they have fallen to 0.26 euros/kWh (2 kuna/kWh).
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7500 solar power plants with a total capacity of 28.353 MW were connected to the HEP ODS distribution network at the end of January
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– In the long term, it is optimal for small electricity producers to cover their own needs and only sell the surpluses. In that case, the selling price is 80 percent of the purchase price or about 0.12 euros/kWh – claims Srb.
Profitability of Investment
He emphasizes that interventions by the Croatian government in co-financing energy prices, electricity, and gas call into question the profitability of investments in the use of renewable energy sources. Namely, if the price of electricity and gas were higher, investing in the use of renewable sources would be more profitable. Therefore, he advises small electricity producers, households, to size their photovoltaic systems according to their own needs, their own consumption. Care should be taken that production does not exceed annual consumption because in that case, the status of a consumer with their own production is lost. Therefore, production should be monitored and the operation should be shut down if electricity production exceeds consumption.
For large and medium-sized entrepreneurs and craftsmen, as well as households, the company E.ON Croatia offers solutions for building solar power plants on a ‘turnkey’ model as a leader in the photovoltaic segment, and according to the director of retail solutions for customers Vladimir Sabo, the biggest challenges they face in implementation are in the administrative part and the inconsistency of the process in issuing permits for connecting photovoltaic plants. In his opinion, the market potential is large, and Croatia has the opportunity to reach the top of the EU in the utilization of renewable energy sources, but for that, a partnership cooperation of all involved in the process is needed, from institutions to the end customer or consumer producer.
