Transmission manufacturer and utility HEP in joint venture to develop 100 MW

Croatian power transmission equipment manufacturer Dalekovod is joining forces with state power utility HEP to develop a portfolio of wind projects totalling at least 100 MW. The two companies, which together are investing around EUR 140 million in the venture, are establishing a joint venture company, Dalekovod Eko, to develop the pipeline. The first project, a 60 MW wind farm near Zadar on the Adriatic coast, is expected to be operational by the end of 2008. "Currently we are measuring the power at 15 to 20 locations in Croatia where there is potential for future wind farms," says Dalekovod's Luka Milicic. Croatia is seen as one of the more promising markets for wind energy in southeast Europe. Since March, the Croatian utility, HEP, is legally required to buy all wind power at 90% of the average selling price of electricity to the consumer, resulting in a payment of HRK 0.64/kWh (EUR 0.087/kWh). The effective subsidy is paid for out of a levy on all power purchasers of HRK 0.89/kWh, to increase gradually to HRK 2/kWh in 2010. At the same time the government is awarding grants for local wind turbine manufacture from a budget of HRK 5.75 million (EUR 788,000) -- and wind development is sheltered from local taxes. The aim is to generate 5.8% of Croatia's electricity from renewables by 2010, up from 0.6% in 2002, to be achieved by building 400 MW of new renewables capacity, 300 MW of that to come from wind power. Requests to develop 1800 MW of wind plant have so far been submitted to the country's economy ministry for approval. "Four or more potential investors are registering for one location," says Zeljko Tomsic, assistant minister for economy and responsible for energy issues. A register of potential investors in Croatian wind power plants will soon be compiled, he adds.