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Environmental Governance Programme UNDP Croatia

In short lines lines‌ ‌ Renewables: a) costly fashion that EU forces us to implement? implement? b) best solution for climate change mitigation?  Is emission reduction unnecessary cost that stops development and economy?  Can it be a chance for development?  What can be learned from success stories?  Can renewables and energy efficiency help to get us out of economical crises?

Facts:: Facts If current growth rates for RES continue, 4545-50% of electricity in EU would be renewable in 2020 (EC: “Renewable energy snapshots”, 2010


True or false?  We are spending more and more money on R&D (research and development) of energy sector? sector ?  We are spending mostly on renewables and energy efficiency R&D? R&D?

Where is money invested invested? ?

Since 1882, alternative energy sources were subsidized against conventional by a ratio of more than 1:8 End-use energy efficiency had ratio 1:35 against conventional supply

Installed capacities and costs

Doubling installed capacity brings 10% lower electricity price Six times doubled CSP capacity (to 32 GW) would have electricity price competitive with fossil, while PV needs huge new investments for this IIASA, PWC: “100% renewable electricity until 2050�, 2010

CSP – concentrated solar power

Can be combined with gas turbine (if no sun available) Can store heat for 15-18 hours in melted salt

Green jobs in renewables

Green jobs classification  direct jobs (design, construction, operations, maintenance)  indirect jobs (in supplier industries)  induced jobs - that are supported by the everyday consumer spending of those in direct and indirect jobs.

Focus  Where to focus?  Can we produce wind generators in Croatia?  Are biofuels sustainable?  Are photovoltaics too expensive?

 Special attention given to technologies that can be produced domestically and so foster local employment, security of energy supply, environmental impact and lower import of fossil fuels  Focus on small scale investments, investments, not big power plants  Focus on technologies for which period of investment return is less than 10 years even without incentives

Selection of priorities Technology Needs Assessment Report (UNDP (UNDP--Ekonerg Ekonerg)) – analysis performed by experts on the cheapest ways to reduce GHG (39 measures analyzed in total against 11 criteria) criteria) I Development benefits  1. job creation  2. capacity building (production, knowknow-how)  3. economic structure change according to Croatia export orientation  4. agriculture security II Implementation potential  1. marginal cost  2. commercial readiness  3. technology availability  4. measure applicability III Contribution to climate change response goals  1. GHG emission reduction potential / enhancement of CO2 sinks  2. indirect effect on the other air pollutants emission reduction  3. conservation of energy

Top priorities for Croatia:     

Wind Power Plants Biomass in Heating Plants Energy Efficiency in Buildings and Construction Biomass in Cogeneration Plants Increase in Biodiesel Use (only partly analyzed further due to sustainability concern and competition with food production)  Solar Thermal Energy

Solar thermal systems Need for subidies: -Several counties in continental Croatia have recently started to subsidize 25-40% of equipment costs -Recently: Zadar, DubrovaÄ?koNeretvanska county -Others should follow!

Example - households System that satifies 70% of energy for hot water Equipment for a familly of four:     

2 collectors ≈ total 4 m2 Boiler 200 l Pumps Control and automatisation Other

Total investment costs cca USD 5,000 (≈ USD 4,000 equipment + USD 1,000 work)

Investment payback period •

Saved energy 400 400--600 USD/year

Investment payback period between 5-10 years years,, depending on location and usage

With 2525-40% subsidizes, subsidizes, payback period between 3-7 years

With additional 30% higher electricity price, price, payback years! between 2-5 years!

Potential for investment until 2020  From 2008 level (14 (14 m2/1000 citizens) to goal set in Energy Strategy for 2030 (563 (563 m2/1000 citizens)  Total collectors` surface 2.5 million m2 (from 15,000)  Emission reduction at the end 1.6 million tCO2 annually  Creation of 1,300 new direct jobs and 2,000 indirect jobs and annual turnover USD 120 million

EE in buildings • Physical Planning and Construction Act (OG (OG 76/07) transposes Directive 2002/91/EC on the Energy Performance of Buildings. • All new building buildingss and those for sale or lease need to have a certificate on energy performance

EE in buildings - example Improvments on typical house for familly of four (150 m2)  Thermal insulation 10 cm Investment ≈ USD 10,000.00 (cca. 50 USD/m2)  Additional thermal roof insulation 15 cm (total 20 cm) Investment ≈ USD 2,500.00 (cca. 30 USD/m2)  Thermal floor insulation 10 cm Investment ≈ USD 2,500.00 (cca. 35 USD/m2)  Change of existing windows with new, efficient (LOW E) Investment ≈ USD 9,000.00 for PVC (cca. 300 USD/m2) Total investment ≈ USD 24,000.00 (16,300.00 €) 18

Simple investment payback period


Investment (USD)

Annual savings (USD)

Payback period




13 years

Heating oil



6,1 years

Electrical energy



4,8 years

Potentail for investment  1.4 million units of the existing residences (apartments and houses)  With EE measures applied to 20% of existing residences (280,,000) in the next ten years, with average USD 10, (280 10,000 investment per residence  Creation of 7,000 new jobs (3 men/months of construction work per residence)  Total investment cost of USD 2.8 billion in 10 years would result in same amount saved over 10 years!

Biomass  Special feedfeed-in tariffs for electricity produced from biomass (among highest in Europe, 12 years contract)  Price of thermal energy is still not defined - obstacle for broader introduction of district heating and cocogeneration using biomass

Biomass heating

Price  Fuel price    

Wood chips (80 USD/t, 35% vl.): 32 USD/MWh Fuel wood (50 USD/m3): 50 USD/MWh Oil (0.8 USD/l): 100 USD/MWh Gas (5 USD/m3): 65 USD/MWh

Pellets and woodchips offer comfort for users like natural gas

Potential for investment  Energy Strategy sets the goal for energy utilization of 72% 72 % of biomass potential until year 2030  Emission reduction in the end – 3.2 million CO2 tons annualy  Analyses show that it could create 5,000 direct jobs and 55 55,000 ,000 indirect and induced green jobs

Wind energy  Install1.200 MW wind generators (foreseen by Energy Strategy until 2020)  Total interest of investors today is almost 6,000 MW (150% of today`s installed capacity) With domestic component 75% of the total product:  New 1. 1.200 direct green jobs  At least 1.000 indirect green jobs  Annual reduction – 1.3 millions tons CO2 emissions


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Environmental Governance Programme UNDP Croatia