Cablegate: Croatia Looks to Wind for Clean Energy Source

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R 211134Z NOV 06
FM AMEMBASSY ZAGREB
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SIPDIS

SIPDIS

E.O. 12958: N/A
TAGS: ENRG ECON HR
SUBJECT: Croatia looks to wind for clean energy source

1. (SUMMARY) Driving along the coastal highway, the 14 recently
erected windmills appear on a bluff above the town of Sibenik,
evoking sighs of delight from some and dismay from others. Croatians
are split over whether windmills are another man-made environmental
hazard or the means to help the country meet its quota for clean,
renewable energy while covering domestic power demands. Further
production depends on results of studies currently underway and on
legislation aimed at regulating renewable energy and feed-in
tariffs. Croatia's goal is to have 10 percent of electricity from
renewable sources by 2010 and eventually reach 20 percent. (END
SUMMARY)

2. After an official from the Croatian electric company (HEP) stated
during an energy conference that there were more investors
interested in wind energy than projects to invest in, HEP
commissioned the Zagreb-based energy think tank, the Hrvoje Pozar
Institute, to conduct a thorough study of the pros and cons of wind
energy in Croatia. Issues include connecting wind power to the
energy grid, compensating for dips in wind-generated power,
environmental impact, and comparing the wind plants' cost to
potential production. The study is expected by the end of the year.
The GoC is considering legislation that would define the share of
electricity from renewable energy sources and establish a tariff
system.

EnerSys

3. Econoffs recently visited a newly-opened wind power plant built
and operated by EnerSys in Sibenik on the Adriatic coast, the second
such plant constructed in Croatia. The plant was completed in June,
with opening ceremonies held Nov. 14. EnerSys' director Zeljko
Samardzic said the plant was built after a two-year feasibility
study, similar to the one being done by Hrvoje Pozar. Samardzic
showed the completely computerized and automated interior of the
windmills, explaining that information on energy production, wind
speed, and maintenance problems could be monitored in real-time from
an office in Sibenik.

4. The fourteen 50-meter high windmills, with 24-meter blades, are
the smallest models. They each operate on 40 kW per hour, but
together can produce 11.1 megawatts of electricity per hour. When
operating at full capacity, the windmills could produce electricity
for 10,000 homes. Except for the soft whooshing of the blades, the
windmills are barely audible when standing beneath them, dispensing
any concerns of sound carrying to nearby towns. HEP has contracted
to buy electricity from the EnerSys wind plant for 61 euros per MWh
for 15 years.

Koncar

5. Koncar, an electrical equipment company, is also conducting its
own study with plans to erect an experimental wind farm in Konjsko,
inland from the coastal city Split. The plan calls for construction
of ten 1-megawatt windmills, costing about $12 million, by the end
of the year and 15 more windmills next year. Company director
Miroslav Madercic said Koncar has been making parts for windmills
and decided to produce their own with an eye toward the global
market. He said Koncar can make windmills faster than the 9 months
it currently takes for delivery from one of the European producers.
He said windmill production and windmill plants are good for
economic development in Croatia, adding that the windmill industry
(both production and operation) employs some 70,000 in Germany.
Koncar sees a good market in neighboring countries, especially
Bosnia and Serbia.

6. Madercic said Croatia would be best served by a combination of
wind and hydroelectric plants, because hydroelectric plants can
quickly compensate when there is not enough wind to produce
electricity. He said one reason wind and hydro power plant
production is stalled is because of HEP's focus on gas and coal
plants. He said there could be many more projects in progress, but
all need HEP's approval to connect to the electrical grid. He also
said if feed-in tariffs are set at 8 euro cents per kilowatt hour,
wind energy park construction would be feasible.

More projects planned in Croatia

7. Next year EnerSys plans to build another 12-windmill park in
Orlice, between Sibenik and Split, with an electrical output of 9.6
MW. The following year, project developer Valalta from Istria and
German partner Wallenborn Projektentwicklung are planning a wind
power plant with 22 generators in Vratarusa, near Senj and 34 more
wind generators in Cicarija in Istria. Croatian company Dalekovod,
is currently surveying 25 locations in Bosnia and Croatia. They have
placed wind-measuring units in 10 locations so far. All of these
projects are moving forward but will be more secure once the
approving legislation is passed.

Environmental concerns

6. Environmentalists and ornithologists have expressed concern for
birds that often fly along the coast. They claim that too many have
been killed by flying into the spinning windmill blades. Koncar's
studies include bird migration patterns. Madercic said Koncar will
avoid erecting windmills in the direct path of such migration or
they would be erected higher to avoid flying species common to the
area. However, environmentalists said birds are not completely
predictable and that even the higher windmills would still pose a
hazard to high flying species such as eagles and hawks. The EnerSys
director said the windmills pose more of a threat to bats, which are
attracted to sound and added, "Many more birds are killed on the
highway than by windmills."

Tourism

7. While some are concerned windmills will take up prime coastal
land, which could be used for hotels and golf courses, others see
the beauty and attraction of wind farms. A representative from
Hrvoje Pozar said there was mention of turning the first wind farm
on Pag into a tourist attraction, similar to one in California.

Bradtke

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