Croatia: Marubeni & HEP new TPP Plomin C expensive electricity impacted from regional exports

28. September 2015. / SEE Energy News

Given that the projects of new power plants in the region have being slowly developed, the problem could be visible after 2019th where BiH could have up to 20,000 GWh available for export, and Serbia 18,000 GWh.

Excess production in neighboring countries will lead to a big drop in the electricity price, which will very badly affect the projects economy. That could be a problem for power plants in Croatia, because HEP will be contractually bound in Plomin to redeem expensive electricity and at the same time will pay off expensive credit for dubious gas power plants in Osijek, which probably is not necessary.

Prime Minister Milanovic has visited Japan recently, where, among other things, met with representatives of Marubeni, the Japanese company that should build TPP Plomin C on coal. So, a clear signal has been given to Japanese that Croatia is committed to the realization of this project, “we only need a little more patience” that the Directorate General for Competition gives us the green light that HEP, by buying 100% of energy from Plomin, does not harm the market development. If we put aside the high purchase price – which is a problem in itself – such a contract is de facto a state aid by which a contractor undertakes a privileged position, and there we are already on a slippery slope. So many familiar with this issue believe that Croatia does not even in a dream have such a lobbying force with which could push a project in Brussels. There is a hope in HEP that what the British managed to do with NPP Hinkley Point C, opens the chance that Croatia gets the green light. Some would say to that: “Quod licet Iovi, non licet buoy”, or “What is allowed to Jupiter is not permitted to the ox”.

However would end up, when thinking on the future of Croatian energy, often seems as if we are an island in the sea or a tiny star in the universe, around which there is only nothingness. There are no contemporary media, no internet – we simply have no idea what is going on across the border, what winds blow, what is “in” and which becomes “out” and why.

Croatia is planning two major fossil fuel power plants, which exclude each other. Instead on numbers, it is continuously pumped story that we are “the largest net energy importer in the world” and the public is afraid of “power plants shutdown”, so we will remain without electricity. They spend millions on documentation, tenders are announced, a great mental and financial capacity is put in projects that already are or could easily become economically and environmentally ballast, because of the circumstances in which we have no influence. In the meantime, the Earth rotates and some people smarter than us think what is the next and warn that we should change the energy paradigm and turn to cleaner technologies that do not need subsidies, or at least no higher than those already provided for fossil sources.

In an area we naturally gravitate, due to obsolescence and inability to meet EU standards, 13 thermal power plants should be rebuilt or shut down. All these countries have plans for restoration of old capacity with new ones, typically coal-fired facilities, in various stages of preparation or implementation. Each country (and most have very good potential for renewable energy), acts as an island in the sea, as if their energy needs cannot be realized by energy interconnection, the synergy of conventional and renewable energy sources and energy efficiency scrupulous. It was recently published a study that shows that BiH, Serbia, Montenegro, Macedonia and Albania could face already in 2024th with a huge energy surplus which rises to 56%!

Given that the projects of new power plants have being slowly developed, the problem could be visible after 2019th where BiH could have up to 20,000 GWh available for export, and Serbia 18,000 GWh. Excess production in neighboring countries will lead to a big drop in the electricity price, which will very badly affect the projects economy. That could be a problem for power plants in Croatia, because HEP will be contractually bound in Plomin to redeem expensive electricity and at the same time will pay off expensive credit for dubious gas power plants in Osijek, which probably is not necessary. If by any case Croatia does not build its power plants on fossil fuels, but its energy policy directs towards EU horizon, it still could benefit from an abundance of cheap electricity by 2050th, which will, thanks to a strange shortsightedness, run this country. If, however, it engages in fossil projects, the risk is considerable. Thus historic opportunity for quality energy transition in this region could be lost and the National Electric Power Industry will no longer be desirable bride, but rather easy privatization target , transmits Serbia-energy.eu

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