Serbia plans by 2020 to have quarter of electricity from renewable sources

14. December 2012. / News Serbia Energy

By 2020, 27 percent of the total energy should be generated from renewable energy sources, says Energy Minister Zorana Mihajlovic. The construction of the wind farm in Kovin is questionable because of reduced feed-in tariffs, according to the American company “Continental Wind Partners.”

Energy Minister Zorana Mihajlovic said it was realistic for Serbia to get 27 percent of the total energy consumption from renewable sources.

Mihajlovic said that this will be achieved thanks to the measures of the Action Plan for the use of renewable energy sources, which primarily provides for investment in biomass, small hydro power plants, geothermal, and wind and solar energy.

After presenting the new National Action Plan for the use of renewable energy sources by 2020, Mihajlovic said that there has been some reduction in the amount of incentive feed-in tariffs for wind and solar energy, and new incentive tariffs have been introduced for cogeneration plants fueled by coal, power plants fueled by gas and all kinds of solar panels on roofs.

The rating of power plants using waste was cancelled, and a special category of combined coal plants has been introduced to encourage highly efficient use of the most important domestic energy resources.

Interested investors and professional public will have the right to discuss and comment on the proposal of the Ministry of Energy, which refers to the amount of feed-in tariffs for renewable energy.

Mihajlovic said that the period of applying the feed-in tariffs will remain unchanged and it will last for 12 years, but total installed capacity of wind power necessary to obtain the status of privileged producer is increased to 500 megawatts.

The Minister repeated that the priority in the utilization of renewable sources of energy are biomass, small water flows, then geothermal and wind and solar energy.

“Given the wealth of Serbia’s renewable energy sources I believe that we can meet the goal to produce 27 percent of energy from renewable resources by 2020 and to significantly improve energy efficiency in the country,” said Mihajlovic.

According to her, that the two international consultants were engaged in order to realistically determine the feed-in tariffs, which should be satisfy both the state and investors, which need to be partners, and not the opposing sides in this business.

In order to make better and more efficient use of renewable energy sources, Zorana Mihajlovic said that they are working on amending the Law on Energy regarding the review of the energy permits and regarding to what the investor is obliged to do in three years from issuance of the permit.

Ministry of Energy is preparing a public call for interested investors who want to get the location for small hydro power plants, which is completely new and those public calls will be completed by the end of this year.

Early next year, bidding is expected on based on these calls for proposals, minister Mihajlovic said.

“I believe that the plan of utilization of renewable energy sources will be fully realized,” said the minister and told investors that they are welcome in Serbia and that they can turn to the Ministry regarding all the problems they are facing.

Lower feed-in tariffs are an obstacle for windmills

President of the American company “Continental Wind Partners” Mark Crandall said that the construction of wind farms in Serbia is uncertain due to the proposed reduction of “feed-in tariff” – the price at which the producer sells electricity to the power supply company.

“The proposal of new feed-in tariff is a setback for the use of renewable energy sources in Serbia,” Crandall said after the presentation of the policies and plans of the Ministry of Energy for the use of renewable energy sources in the Serbian Chamber of Commerce.

Crandall added that the tariffs have been reduced for electricity from wind energy, without which Serbia can not achieve the goal of increasing the share of renewable energy in total consumption to 27 percent by 2020.

According to him, for now he is not sure that his company will be able to finance the construction of a wind farm in Serbia because the financial model is based on a price of 9.5 euro cents per kilowatt hour for electricity from wind energy, with adjustment for inflation in the euro zone.

“Instead, in the new proposal of tariffs, the rate was reduced (to 9.2 eurocents per kilowatt hour) and no adjustment is provided for inflation, while electricity will be bought by a newly established company that has no money, and in such conditions it is difficult to expect any international bank to support the project of our company in Serbia” Crandall said.

The American company plans to start the construction of the wind farm next year in Kovin, with up to 170 MW of power where 300 million Euros would be invested.

Source Serbia Energy Magazine

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