officially the Republic of Croatia,
is a unitary democratic parliamentary republic in Europe at the crossroads of the Mitteleuropa, the Balkans, and the Mediterranean. Its capital and largest city is Zagreb. The country is divided into 20 counties and the city of Zagreb. Croatia covers 56,594 square kilometres (21,851 sq mi) and has diverse, mostly continental and Mediterranean climates. Croatia’s Adriatic Sea coast is long and traced by more than a thousand islands.
Total installed electricity capacity (2004): 4049 MW
- Hydro-electric: 51%
- Thermal: 40% (16% Oil, 15% Coal, 9% Natural Gas)
- Nuclear: 9%
Total Primary Energy Supply 2006:
- Liquid Fuels: 44%
- Hydro: 15%
- Natural Gas: 24%
- Coal: 8%
- Fuel wood: 4%
- Electricity: 5%
The total primary energy supply in Croatia up to 2006 was 409.08 PJ while in 2005 it was 411.6 PJ. RES other than fuel-wood and hydropower represented 0.06% of the total supply.
The total electricity consumption reached 18 TWh in 2006, but the share of RES without large HPP was only 0.68%, with small HPP accounting for 54%; wind-power, 0.11% and landfill gas, 0.03%.
Croatia highly depends on energy imports and during the recent years import is continuously having an upward trend. In 2005 the total energy import increased by 2.9% with respect to 2004. The imports of electrical energy, petroleum products and natural gas rose, while the imports of coal, coke and crude oil fell. The greatest increase of 65% was that of the electricity, while the petroleum products and natural gas rose less than 10%. During the six year period (1999-2005) the total energy import in Croatia grew at an average annual rate of 5.6%, with a high average increase rate of 36% in petroleum products. The electricity import also grew rapidly at an average annual rate of 14.8 percent.
In 2007, the import/export balance by energy source was as follows (all units ktoe):
- Oil: 5866.9 / 1898.6
- Natural Gas: 648.3 / 441.3
- Solid Fuels: 688.0 / 0.0
- Electricity: 639.9 / 124.2
National electrification rate ( 2000): 99%
Although the Republic of Croatia is almost completely electrified, there are still regions which do not have access to the electricity network or where the network capacity is insufficient. For the most part such areas are under special care of the state (i.e. underdeveloped, devastated by war, depopulated), on islands or in mountainous regions.
There is an increasing dependency on electricity import in Croatia as the result of growing consumption and lack of new investment in power generation capacities. In the recent years Croatia imports more than 20% of electricity.
A 4.1% increase in electricity imports compared to the previous year was observed in 2004. The losses in transmission and distribution of energy consumption increased in the total primary energy supply for 2004. Coal consumption increased dramatically in this period also, by 107.8%.
Whilst increases in GDP were observes corollary to the increase in energy demand, the energy intensity of Croatia is 24% higher than the EU average, meaning the continued rise in GDP is not sustainable.
Renewable energy sources cover a large share of electricity generation in Croatia, driven by the significant number of hydroelectric power plants in the country. Total hydropower installed capacity was 2,058 MW in 2006, dominated by large HPPs, with hydropower generation accounting for 6,070 GWh in 2006.
The Croatian wind sector has seen a large expansion in recent years, reaching 17.2 MW of total installed capacity in 2006, coupled with a generation level of 20 GWh.
There is a relatively high potential for wind power in Croatia. Currently research is being carried out on the potential construction of wind farms of a total installed capacity of about 1,500 MW, however in order to maintain the secure operation of the electricity system it is very probable that only some of these projects will be realized.
Croatia has significant potential for biomass and geothermal, with 9.39 TWh per annum potential electricity production in the case of biomass and 870 MW potential capacity in the case of geothermal. Forests cover more than 40 % of Croatian territory, which means that potentials for biomass use are significant. Within the national energy program BIOEN it has been demonstrated that by 2030 at least 15 % of the total energy consumed could be obtained from biomass. It will be used for production of thermal energy and electricity.
It is expected to contribute mainly in thermal energy production; primarily in low temperature appliances and the passive solar architecture will reduce the need for thermal energy in buildings. Most of the installed solar capacity of Croatia (some 12,000-15,000m3) is off grid, with the 3 grid-connected systems in the north of the country contributing 48.8kW. A database of solar radiation in the country was published by the Hrjove Pozar Energy Institute, in conjunction with the University of Split, in 2006. According to this survey, the total solar energy potential of Croatia is 100PJ.
Croatia has some geothermal reservoirs in the north of the country, many having high value temperature gradients. According to studies conducted under the National Energy Program GEOEN, the total energy potential is 839 MWt, with the potential for power generation from geothermal sources being 48MW.
There are overall saving potentials in industrial and residential sectors. Energy efficiency measures include the use of low-energy bulbs and refrigerators in households. The First National Communication from the United Nations Framework Convention on Climate Change expects these measures to save up to 600GWh by 2030. Increases in efficiency can also be made in industrial electric motors (up to 7.5%, or a saving of 254 GWh in 2010) as well as increased uptake of low-temperature heat generation, and implementing demand-side management techniques in non-heat electricity use.
The Electricity Market Act prescribes dynamics of electricity market liberalization. There are two groups of customers in Croatia: eligible and tariff customers. Since July 2008, all customers are deemed eligible customers and can choose a supplier on a free market and negotiate the electricity price. The Electricity Market Act also introduces the concept of a privileged producer, a status that can be obtained by a producer which simultaneously produces electricity and heat in an individual generation facility or utilises waste or renewable energy sources in an economical way while taking into account measures of environmental protection.
However, the Croatian energy sector is characterized by being owned in its majority by the state, except for natural gas distribution and retail sale of petroleum products, which, together with the distribution of LPGT, are partially in private hands.
In accordance with the energy legislation, Hrvatska Elektroprivreda d.d. (HEP) was transformed in 2002 into the HEP Group, a system of affiliated companies performing core electric activities and auxiliary activities. The HEP Group is a holding consisting of the parent company (HEP) and its subsidiary companies over which HEP exercises prevailing control: HEP Production, HEP Transmission, HEP Distribution, HEP Supply, HEP Gas, HEP District Heating, Sisak District Heating. The privatization of HEP will be performed in accordance with the HEP Privatization Act, www.hep.hr/hep/en/news/default.aspx
Oil & gas
The INA Group is the state-owned holding company that controls Croatia’s oil and gas exploration, production, transportation, trading, refining, and retailing. INA d.d. is the sole company producing and importing gas (and oil) in Croatia. INA owns 38% of the oil pipeline systems. INA was partially privatized in 2003 when Hungarian oil company MOL bought 25% plus one share which offered the best tender within the shortlisted candidates.
The competition in power generation was introduced by the Law on Electricity Market (Official Gazette No. 68/01, 177/04). The Electricity Market Act defines the role of the distributions system operator, the transmission system operator, the market operator and the provider. The energy activities are performed as market activities (generation of electricity for privileged buyers, supply of electricity to privileged buyers, and marketing, intermediation and representation on the electricity market) and as regulated activities which are performed as public services (generation of electricity for tariff buyers, transmission of electricity, distribution of electricity, managing electricity market, supply of electricity for tariff buyers).
Currently, three companies have been granted permits to generate electricity: HEP Proizvodnja (member of the HEP Group), TE Plomin doo (member of the HEP Group), and INA Industrija nafte dd. However, the HEP Group still has a factual monopoly in transmission, distribution and sale of electricity, as only members of the HEP Group have been granted permits for the performance of activities of transmission of electricity, distribution of electricity, managing of electro energetic system, and organisation of electricity market.
The Energy Strategy of Croatia was adopted by the Croatian Parliament on March 2002, for the period of 10 years. The principal objectives of the energy policy of the Republic of Croatia are stated in the Energy Sector Development Strategy (Official Gazette 38/2002 – summary). Some of the main objectives of the Energy Strategy are listed below:
- Improvement of energy efficiency from the production, transformation, transmission and transport to distribution and consumption of energy;
- Utilization of renewable sources of energy which will be in accordance with sources, technological development and economic policy as a whole;
- Environmental protection, which in the energy sector implies the primary action in connection with energy efficiency, renewable sources, choice of energy-generating products and application of state-of-the-art protection technologies, quality legislation and supervision, the public opinion and education and promotion of best practices.
Support to RES
In accordance with EU Directive on the promotion of the electricity produced from renewable energy source 2001/77/EC Croatia is obliged to set its share of RES in total energy consumption in 2010. In alliance with business indicators the recommended target is 1100 GWh of electricity from RES, or 5,8% of total energy consumption in Croatia in 2010 (excluding large scale hydro power plants).
Following this, a new system for stimulation of production of electricity from RES was introduced. The new system started in 2007 when Croatia has introduced the Tariff system for the production of electricity from renewable energy sources and cogeneration (OG 33/07).
Energy Efficiency Programmes
Croatia ratified the Kyoto Protocol in 27 April 2007. Croatia is now obliged to reduce its emissions 5% in relation to the base year over the commitment period 2008-2012 and energy efficiency measures are expected to play a crucial role in fulfilment of these obligations.
The important place of energy efficiency in overall Croatian energy policy is also confirmed by the national energy programmes, established in 1997. Programmes dealing with energy efficiency are KOGEN, MIEE, KUENcts, TRANCO and KUENzgrada.
No debates are currently in progress on Croatian energy legislation.
In 2003, the Ministry of the Economy and the Ministry of Environmental Protection and Physical Planning of the Republic of Croatia, consulted by the Energy Institute Hrvoje Poaar, established the Environmental Protection and Energy Efficiency Fund.
It is a structured extra budgetary fund which finances projects and activities in three areas:
- Environmental protection
- Energy efficiency
- Renewable energy sources
On the 4th February 2005 the Environmental Protection and Energy Efficiency Fund and the Croatian Bank for Reconstruction and Development (HBOR) signed an Interest Rate Subsidy Agreement for loans intended for environmental protection, energy efficiency and renewable energy resources projects.
Role of government
The Croatian Parliament determines and passes the legal framework for the energy sector, receives reports directly from the Croatian Energy Regulatory Council, reviews and approves financial proposals and global energy policy stated in Energy Sector Development Strategy.
The Government of the Republic of Croatia submits to the Parliament proposals for financing energy needs, establishes the energy policy including principles of environmental protection, which also includes energy efficiency and energy production from renewables sources.
Ministry of Economy, Labor and Entrepreneurship
The Ministry of Economy, Labor and Entrepreneurship is the governmental body responsible for energy. This Ministry gives the Preliminary Energy Approval and Energy Approval and leads the register of projects and plants for the use of Renewable Energy Sources and Cogeneration and Eligible Producers. This Ministry is also responsible for renewable energy sources that cover thermal energy, energy efficiency and biofuels in the part of energy politics.
Ministry of Environmental Protection, Physical Planning and Construction
The Ministry of Environmental Protection, Physical Planning and Construction is the governmental body responsible for environmental protection and construction. This Ministry, in cooperation with its local offices accepts Environment impact studies and gives Location permits, Building permits, and Operating licences for every kind of constructions, including renewable energy sources.
Environmental Protection and Energy Efficiency Fund
The Environmental Protection and Energy Efficiency Fund was established by virtue of the Act on the Environmental Protection and Energy Efficiency Fund (OG 107/03). The Fund co-finances programmes, projects and activities in the field of environmental protection, renewable energy sources and energy efficiency. The Act stipulates the conditions for its operations.
The new Strategy for Energy Development, The Act On Efficient Use Of Energy, The Act On Biofuels, Energy Efficiency Master Plan 2008-2016, First Energy Efficiency National Action Plan 2008-2010, legislation on renewable energy sources for production of thermal energy, legislation regarding energy savings in buildings and revision of current legislation on renewable energy sources for production of electrical energy.
The Croatian Energy Regulatory Agency (HERA) was established in 2004 and replaced the former Council for Regulation of Energy Activities (VRED) established in 2001.
Degree of independence
The Croatian Energy Regulatory Agency (HERA) was formally established by the law as an independent non-profit institution. The five members of HERA Management Board are proposed by the Croatian Government and appointed by the Parliament, with the mandate of 5 years.
The legislative framework in the electricity supply sector in the Republic of Croatia is to a great extent aligned with the EU legislation. It includes the Energy Act (OG 68/01, 177/04 and 76/07), the Electricity Market Act (OG 177/04 and 76/07), the Act on the Regulation of Energy Activities (OG 177/04 and 76/07) and a series of subordinate regulations.
The main regulator’s roles and tasks are:
- issuing licences for carrying out energy activities,
- activities aimed at ensuring transparent and non-discriminatory functioning of the energy market,
- activities aimed at ensuring transparent and non-discriminatory performance of energy activities subject to public service obligation,
- carrying out activities related to regulation of energy prices to be set on the basis of tariff systems.
Energy regulation role
The Ministry of Economy, Labour and Entrepreneurship has to enact the Regulation on Utilization of Renewable Energy Sources and Cogeneration.
The Ministry of Economy, Labour and Entrepreneurship determines licensing procedure and requirements.
The Government determines the tariffs for regulated energy activities. Tariffs are proposed by the Ministry of Economy, Labour and Entrepreneurship, upon the opinion of the Regulator.
The Croatian Energy Market Operator (HROTE) was established in March 2005 to oversee the organisation of the electricity market as a public service. The organisation is overseen by the HERA.
Only limited progress can be reported in the area of renewable energy sources (RES). The 2008 target of biofuels for 2008 has been set at 1.21% of the overall fuel consumption on the domestic market.
Administrative capacity in energy efficiency and RES needs significant strengthening.
Limited progress has been made in the field of energy efficiency. Implementing legislation related to energy labelling of household appliances has been enacted. Croatia still needs to ensure compliance related to high-efficiency cogeneration (CHP), energy end-use efficiency and energy services. No progress has been made in transposition of the acquis related to the energy performance of buildings.
- Croatia Energy Regulatory Agency (CERA)
- Croatian Bank for Reconstruction and Development (HBOR)
- Croatian Energy Market Operator (HROTE)
- Croatian Energy Regulatory Agency (CERA)
- Croatian Environment Agency (AZO)
- Croatian Solar Energy Association (Croatian Solar Energy Association)
- Energy and Environmental Protection Institute (EKONERG)
- Energy Institute (EIHP)
- Energy Institute Hrvoje Poar (EIHP)
- HEP (HEP)
- HEP ESCO (HEP ESCO)
- Ministry of Economy, Labour and Entrepreneurship
- Ministry of Environmental Protection and Physical Planning and Construction
- REN21 Country Profile
- ELDIS Country Profile
- CIA Factbook
- Wikipedia Country Profile
- EIA Country Energy Profile
- FCO Country Profile
- ODYSSEE Energy Efficiency Country Profile (PDF file)
- UN (ESA) National Information/National Report
- ECOI Country Profile
- World Bank Documents
- EBRD Country Profile
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Croatian Center of Renewable Energy Sources (CCRES)