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Croatia launches renewable energy auction with 10 MW earmarked for geothermal

Croatia has launched a tender for renewable power projects, among them for up to 10 MW of geothermal to qualify under a market premium price. Projects need to be above 500 kW and relevant approvals.

Reported locally, the Croatian electricity and gas regulator Hrvatski Operator Trzista Energije (HROTE), has launched an auction to allocate 322 MW of renewable energy capacity to developers.  

On March 30, 2022 is done on the basis of a support program approved by the European Commission, Croatian electricity and gas regulator Hrvatski Operator Trzista Energije (HROTE) issued a public call for tenders to encourage the production of electricity from RES through a market premium system. Market premium is an incentive system in which HROTE pays a market premium, ie the difference between the contracted reference value and the market price of electricity. The total quota for new projects is 630 MW, which is about 60% of the current portfolio in the incentive system run by HROTE. 

Main features of the public call:

Call open to the following RES technologies:

Public invitation prescribes the conditions that projects must meet in order to submit a bid and lasts 60 days, after which a public tender will be announced for 15 days during which project holders will be able to submit their bids. The public tender will be open exclusively for new projects, by technology, for 300 MW of wind and solar, 8 MW for biomass and biogas, 4 MW for small hydropower plants and 10 MW for geothermal power plants.   

RES projects that use innovative technologies whose development is financed by EU funds for the development of innovation, in accordance with the prescribed conditions, may also participate. The public tender is open to project holders who have previously obtained a location or construction permit, energy approval and electricity approval.

Based on the conducted public tender, HROTE makes a decision on the selection of the most favorable bidders, which is based on the most favorable offered benchmark until the quota for certain technologies is filled. A market premium contract will be concluded with the project holders whose bids are assessed as winning for 12 years from the activation of the contract, with the project holders having 4 years to build a production plant, put it into permanent operation and acquire the status of a privileged producer.

If all quotas from this public call were filled and the plants realized, the Republic of Croatia would thus receive about 1.5 TWh per year of new renewable energy. A market premium contract will be concluded with the project holders whose bids are assessed as winning for 12 years from the activation of the contract, with the project holders having 4 years to build a production plant, put it into permanent operation and acquire the status of a privileged producer. If all quotas from this public call were filled and the plants realized, the Republic of Croatia would thus receive about 1.5 TWh per year of new renewable energy.

A market premium contract will be concluded with the project holders whose bids are assessed as winning for 12 years from the activation of the contract, with the project holders having 4 years to build a production plant, put it into permanent operation and acquire the status of a privileged producer. If all quotas from this public call were filled and the plants realized, the Republic of Croatia would thus receive about 1.5 TWh per year of new renewable energy.

For solar and geothermal, project sizes will have to exceed 500kW, while for wind projects this threshold has been set at 3MW. Hydropower projects will need to have capacities of 500kW to 10MW and biogas and biomass installations will need to be sized between 500kW and 5MW.

Selected projects will be awarded 12-year feed-in premium contracts and will have to start delivering power in 2024. The ceiling for PV has been set at HRK 495.63 ($72.40)/MWh and HRK 460.91/MWh for wind power.

The auction is part of a 2.2GW series of tenders for large-scale renewables held by HROTE.

Source: HROTE

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