Macedonia pulls in wind investors -- Market framework clarified

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This year is set to be a turning point for wind power in Macedonia, with three foreign investors announcing concrete plans for both project development and equipment manufacturing in response to more transparent guidelines from government. Macedonia pays EUR 0.089/kWh over 20 years for wind power and the national grid company is obliged to accept all wind generation.

The biggest of the three initiatives comes from Spain's Invall Green Energy. It plans to invest EUR 200 million in building 150 MW in 50 separate projects near Stip, one of the largest cities in eastern Macedonia. The company has teamed up with Spanish investment fund Si Capital for project financing and local firms may join in. The decision follows six months of wind measurements. An agreement with the municipality of Stip was expected last month. Construction is to start in early 2009.

The second initiative comes from Euro Investments Group (EIG), a renewables specialist based in Israel. It is investing EUR 12 million in a factory in Prilep to produce towers and possibly blades. Investment by partners will bring the total value to EUR 15 million. Production is to start later this year, targeting customers in Macedonia, Albania, Greece, Kosovo and Serbia. EIG has an agreement with the municipality of Sveti Nikole to erect 90, 2 MW turbines and site work is to start soon. The EUR 360 million wind farm is to be supplemented with 20 MW of solar power.

Third, RE Energy, a Serbian-Austrian wind developer, has an agreement with the municipality of Radovis for the construction of a 50 turbine wind farm. In the first stage of the EUR 20 million project, 15 turbines will be raised near the Bucim mine, an area of strong winds. The company has established a local subsidiary called Nova Energija.

Improved environment

Interest in Macedonia's wind sector has increased since May last year, when the government published guidelines for the construction and operation of wind power plant, clarifying requirements for planning permission, construction approval and environmental impact studies, among a list of other preconditions.

The transport ministry has become a central clearing house for all wind plant bids submitted in response to government tenders, or with rated capacities of 2 MW and more. For plant smaller than 2 MW, applications must be submitted to local authorities. Authorisation for payment of the government mandated price is required from the Energy Regulatory Commission.

Applicants must be in possession of grid connection agreements with Austrian energy company EVN, which owns Macedonian power company ESM. The company must decide each application within 90 days. Applicants must also submit technical and operational data to the Macedonian Transmission System Operator. Plants of 10 MW or above will in all cases be connected to the transmission network, according to the economy ministry.

The government, which is still fine-tuning ordinances and regulations, is also working on a wind atlas detailing wind potential for several regions with completion planned for the first half of 2009. Meanwhile, 11 foreign companies from across Europe have conducted wind measurements in Macedonia over the past year.

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