In early 2011, Croatia has begun implementing several projects proposed by the Energy Strategy for the period until 2020, which had indicated the need for a total of $20 billion investment in new energy sector projects. Lacking its own financial and technology resources, Croatia will highly depend on foreign investors and equipment and services suppliers. Most of the key prospective buyers are still government-owned companies obliged to handle their procurement by public tenders. The best way for U.S. exporters to enter this market is through a carefully chosen local representative who has local contacts and a good understanding of local procurement practices.
Croatia imports over 50 percent of the total of about 300 PJ (petajoules) of energy consumed annually. It imports 80 percent of its oil needs, 40 percent of gas, 20 percent of electricity, and 100 percent of coal needs. Due to the expected three percent annual increase of energy demand and the projected exhaustion of Croatia’s own oil and gas resources during the next ten years, its dependence on imported energy will continue to grow.
Croatia is scheduled to become a member of the European Union (EU) on July 1, 2013 and has already adjusted most of its energy sector regulations and development plans to enable smooth integration into the European energy market. In line with the EU approach, on October 16, 2009, Croatia’s parliament adopted a professionally-prepared and publicly-discussed Energy Strategy for the period until 2020. Adjusting Croatia’s energy policy with EU goals for 2020, the strategy addresses Croatia’s need for increased, diversified and sustainable supply of energy resources and improved energy efficiency.
In the electric power generation sector, the strategy has identified the need for construction of a total of about 3,500 MW of the installed capacity (the current total capacity is about 4,000 MW, of which about 1,100MW is in facilities at the end of their life-cycle). In the oil and gas sector, it has identified the need for construction of additional oil and gas pipelines, an LNG terminal and gas storages. Upgrades and modernization are also needed in the district heating sector. The estimated total investment in these projects exceeds $20 billion (about $2 billion annually). An estimated 60 percent of the investments would be needed in the electric energy sector, 30 percent in the oil and gas sector, and 10 percent in the district heating sector. Croatia does not have sufficient financial and technology resources for these investments and it will highly depend on foreign investors and equipment suppliers.
To meet the estimated needs for additional installed capacity in the electric power generation sector by 2020, the strategy envisions completion of the three current projects and construction of new plants as follows:
• 250 MW gas-fired cogeneration plant in Sisak (in construction)
• 300 MW in several hydro-power plants (includes the most recent completion of a 42 MW plant in Lesce)
• 1,245 MW in numerous plants using renewable sources:
• 1,200 MW wind
• 140 MW biomass
• 100 MW hydro (small plants up to 10 MW)
• 45 MW solar
• 40 MW waste
• 20 MW geothermal
• 300 MW in several gas-fired cogeneration plants
• 1,200 MW in gas-fired plants
• 1,200 MW in coal-fired plants
Preliminary preparations for construction of a 1,000 MW nuclear plant will be renewed and should be completed by 2012 when the Croatian parliament will make the final decision on whether to go ahead with this project.
Following the strategy, in April 2010, the Croatian government approved a list of the top priority power plant projects to be carried by the state-owned electric utility company HEP during the next few years, including:
Gas-fired combined-cycle plant TE Sisak (230 MWe, 50 MWt) – in construction
Coal-fired plant Plomin (500 MW) – tender for selection of the strategic partner expected in Fall 2011
Multi-purpose hydro-plant facilities on the Sava river (120 MW, 600 GWh)
Hydro-plant Ombla (68 MW, 223 GWh) – tender documentation is being prepared
Hydro-plants on Lika and Gacka river:
1. Hydro power plant Kosinj – construction of a new power plant, with installed capacity of 52 MW and electricity generation of 48 GWh
2. Hydro power plant Sklope – renovation of the power plant, with installed capacity of 27 MW and electricity generation of 68 GWh
3. Hydro power plant Senj – renovation of the power plant, with installed capacity of 240 MW and electricity generation of 576.4 GW h
4. Hydro power plant Senj 2 – construction of a new power plant, with installed capacity of 360 MW and electricity generation of 864 GWh
5. Two hydro-plants on Drava river (Molve 1 and Molve 2, 50 MW each)
In the oil and gas sector, the strategy discusses several possible major projects of regional importance that have been pending for many years and their implementation is still very uncertain:
• LNG Terminal at the Adriatic coast
• Construction of an underground gas storage (to be managed by Plinacro)
• Druzhba-Adria pipeline project for exporting crude oil from Russia to the Adriatic Sea
• Pan-European (PEOP) pipeline project for exporting crude oil from the Caspian Sea region over the Black Sea and through Romania and Serbia to Europe
• Ioninan-Adriatic gas pipeline to connect to the Trans-Adriatic pipeline exporting gas from the Caspian Sea via Turkey and Greece to Italy