Within the framework of the EU Green Plan which set the ambitious goal of climate neutrality by the year 2050, Croatia has exceptional chances because the new industry based on renewable energy sources and digitalized processes sets the story at the beginning. We have green energy sources, we have smart young people, entrepreneurs, and innovators, and capital always goes where it is secure and profitable. It’s all on us, how will we recognize the chance, will we have the courage to jump onto the train of change and I don’t see any reason why we would miss the opportunity. The dynamics of development are dictated by the energy legislation”, Ante Renić, manager of project development in the company VSB Obnovljiva Energija Hrvatska, said in an interview to Poslovni Dnevnik which were are bringing in full.
The EU set a very ambitious goal of climate neutrality and decarbonisation by the year 2050. What opportunities do you see within the Green Plan?
The potential for development, both for the EU and Croatia, is exceptionally large. In order to attain the goals of climate neutrality and de-carbonization by 2050, it is necessary to change the entire existing paradigm. The energy sector is drastically changing from one based on fossil fuels, in which countries rich in natural sources of such raw material had an enormous advantage, toward a sector of renewable energy sources in which every country has resources for the production of energy and does not depend on the import of fuels. In that sense, the industry will also have to follow those trends in order to remain competitive which will additionally increase the demand for clean energy and stimulate the further development of an industry based on ‘renewables’, a Perpetuum mobile of sorts. The chances for Croatia are exceptional since the new industry based on renewable energy sources and digitalized processes will bring the whole story back to the very beginning.
There is no doubt that clean energy is the goal, but how do you comment the criticism that renewable energy sources to not generate sufficient local jobs and that state subsidies as a rule go abroad to producers of capital equipment, while the price of electricity for the end-buyers is constantly growing?
The production of electricity is not an activity that requires a large engagement of the labor force, regardless of the source of energy. However, it should not be forgotten that clean and available energy is the precondition for the development of the economy and while we are exposed to the oscillations of oil prices it is difficult to initiate any undeveloped industry. The domestic component in the development of wind and solar plant projects varies from 40% to a high 80%. In order for a project to take root, it is necessary to engage domestic consultants, energy experts, builders, establish supervision, pay all the charges, invest in the transmission grid, maintain projects in their operation, pay the legal fees to the local community, pay taxes and other charges. The benefits are great both for the local community and society as a whole. The price of electricity does not go up because of renewable energy sources because even today they are the cheapest source of electricity and with the further development of technology that difference in relation to conventional sources will be even greater. Electricity is a stock exchange commodity and its price is formed by supply and demand. We live in a world in which electricity has an ever greater role in all segments of life, demand is constantly growing and the price rise is to be expected. What we must do ride the wave of the new green industry that would increase the newly created value in society and employment and thereby generate a higher standard of living. You have higher prices of household electricity in the developed countries but the standard of living is much higher in them.
Croatia is progressing in the production of energy from renewable energy sources but is still behind the developed European countries. What is, in your opinion, the main obstacle and challenge that should be worked on in order to increase the share of RES?
Croatia is making progress in increasing the production of electricity from renewable sources and it is to the main part energy from wind farms with reaching about 12%, while the other renewable sources account for a negligible 1% of overall production. It should also be mentioned that production from hydroelectric power plants accounts for 45% of overall production. One of the best examples is Denmark which provides almost half of its needs for electricity from wind farms. There is obvious space for increasing capacities, particularly in the solar plant sector. However, a bigger problem than the source structure is self-sufficiency which is low and we are still importing over 40 percent of our electricity which at times when you need it most and when you have to buy it is at its highest price and is mostly produced in thermoelectric powers plants in surrounding countries, the operation of which is among other detrimental to our health. The further development of large and small renewable energy source projects will generally be determined by the legislation in the energy sector. Large projects require clearly defined rules and stability of both laws and investments, while smaller projects, such as roof solar systems mostly depend on the development level of the distribution grid and regulations pertaining to the transfer of produced electricity to the grid. Stimulating the installation of such a system on the part of the state is of great significance in order for the investment return to be as quick as possible.
You deal with wind and solar energy which ultimately depend on environmental factors. To what degree are wind farms and solar plants technologically advanced, namely, cost effective for use in the continental, as compared to the southern part of the country?
Croatia is perhaps a country that is territorially small but is exceptionally rich in natural resources, including renewable energy sources. Solar irradiance or sunlight in the northern and eastern parts of the country, which we do not consider to be particularly sunny, is equal to that in central European countries which have a significant production of electricity from solar systems. A good example is Germany in which the production of electricity from solar systems is about 38 TWh annually which is more than double the overall consumption of electric power in Croatia. The solar capacities of the coastal area and islands are multi-fold greater and it really is a shame that they are not exploited. The wind energy capacities are also considerable and with the increased efficiency of wind, aggregates are even greater. Not even close have we used the potentials we have at our disposal and which no one can take away or stop. Also, we should not forget bio-thermal energy the northern parts of the country are rich in.
Croatia attains 17% of its electric power from the Krško nuclear plant and it is not a secret that we depend on imported electricity. Is the idea of energy self-sufficiency at all possible and can RES be a relevant factor in its achievement?
It is fact that many wars were waged for control over energy sources and no country can develop its economy without stable energy sources. At one time this was attempted by searching for oil and in one period when technological advances were achieved, nuclear energy appeared as the realization of those aspirations. However, the history of nuclear disasters showed great flaws in that technology and the price of thus produced energy is exceptionally high. Through the development of renewable energy source technologies, they have become a relevant factor since they are the only ones that possess considerable growth in capacities and the only ones that are socially acceptable. Along with the previously mentioned large capacities, we will without a doubt become energy self-sufficient, the question is when. Will we achieve this quickly and provide our economic growth and development or leave inertia to do its bid. Even the new EU guidelines which promote the development of ‘green’ hydrogen from renewable energy sources are to our advantage because we ideally fit into the new concept where we have production and consumption in the same place.
How do local requests in the process of preparing the projects in Croatia differ from those in other countries, for example, Germany or Ireland? In what regard is the understanding of local characteristics significant for the success of the projects?
Renewable energy sources use natural resources which differ from country to country, so for example, you have hundreds of types of wind turbines that are adapted to various types and speeds of wind. Every project is different although some characteristics are similar. However, in spite of the differences every country has resources for renewable energy sources, and in there lies their great advantage in relation to fossil fuels.
The VSB Group installed the first wind farm in 1997. In the two and a half decades since then, how much has technology advanced in the sense of exploitability? Can you image the day (and when) the production of RES in the world reaches 100 percent or is that pure utopia?
As early as twenty years ago companies such as VSB recognized the trend and technology that were only to grow in the future. Development and investments in renewable energy sources was a courageous but correct business decision at that time which resulted in a successful international company that is continuing to expand its successful business model. Technology in this branch is quickly developing so we have wind turbines today that are ten times more powerful than twenty years ago, solar panels have also experienced drastic changes in their efficacy and their prices are multiple times lower if we compare them with the beginnings of their commercial use. Such extraordinary development of technology, which is still unfolding, has enabled the developed countries, which recognized the importance of preserving nature and the economic opportunity offered by domestic energy sources, to produce from thirty to sixty percent of their electricity from renewable sources. These activities are growing year in year out and as I have already mentioned it is not a question of whether we will reach the one hundred percent mark in renewable energy, the question is when we will reach it. Along that path fantastic opportunities for economic prosperity are opening up that will not be at the expense of the environment and our health.