European Commission: Goal Complete, Abolish Incentives for Renewable Sources

By , 27 Apr 2018, 13:36 PM Business
European Commission: Goal Complete, Abolish Incentives for Renewable Sources Photo: Svetlana Mandić

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The EC report for Montenegro reminds that the National Action Plan on the usage of renewable energy sources until 2020 was adopted in 2014 and set a goal of reaching a share of renewable energy sources in total consumption of 33 percent

Total energy consumption from renewable sources in Montenegro in 2016 was 41.6% of the total consumption, which surpasses the set goal of 33%, a cause for the state to abolish current incentives to producers of renewable energy and replace them with market support programs, the EC has recommended.

Incentives for the production of energy from renewable sources we adopted in May of 2014 and since then producers were paid 7.53 million euro. The level of the incentive for the production of electric energy (which citizens pay through their electricity bill) is calculated based on the Energy Law and the provision regulating the incentive for the production of energy renewable sources and highly efficient cogeneration.

The Energy Law provides for the abolishment of incentives when consumption reaches 33%. The EC has rated the national legislature is partially harmonized with the Renewable Energy Directive, while the support for producers of renewable energy is based on feed-in tariffs.

“The state must transfer to an auction system in line with 2014-2020 Directives on state aid for environmental protection and energy,” stated the EC. EU directives on state aid for this sector require for producers to be more exposed to market signals, in order to secure an economical application of renewable sources. These directives require technology neutral auctions for the procurement of renewable energy at low cost.

“The development of new projects, especially hydroelectric plants, needs to be in line with EU legislature on concessions and environmental protection and should take into account the effect on areas of high natural interest,” the EC cited.

The government has at the end of January increased by 3.5 times the fee for incentives of renewable energy production, from 0,129 cents per kWh to 0,47316 cents. The cited reason for the increase was the planned introduction of the electro-energy system of wind power station Krnovo during this year.

Opposition parties condemned the incentive increase and demanded its abolishment. They rated this stimulates the business of friends and cousins of the former PM, and current state President Milo Đukanović. Son of the former PM Blažo Đukanović intends to build two small hydroelectric plant in Kolašin, something opposed by residents of the Lipovska Bistrica village. Large consumers of electric energy, Uniprom KAP, Željeznička Infrastruktura and Toščelik steel mill pay a significantly smaller fee for renewable energy compared to others.

Status of a privileged producer is currently held by companies Hidroenergija Montenegro (for small hydroelectric plants Jezerštica, Bistrica, Orah, Rmuš, Spaljevići 1 and Šekular in Berane), Synergy (mHE Vrelo Bijelo Polje), Igma Energy (mHE Bradavec and Piševska Andrijevica) and Kronor (mHE Jara and Babino polje Plav) and Hydro Bistrica Podgorica (for mHE Bistrica Majstorovina), as well as the Krnovo Green Energy company for VE Krnovo. Founders of Hidroenergija are, according to the Tax Office, Ranko Radović and the Hemera Capital Company (founder Oleg Obradović). Obradović is the authorized representative of Hidroenergija.

Founder of Synergy are Kia Montenegro (founder Željko Đuranović, representative and executive director Vuk Rajković), Dragana Bošković, Tomaš Hajek, Uroš Karadžić and Radoje Vujadinović.

Owners of the Igma Energy Company is Igma Grand of Igor Mašović, brother of Andrijevica Mayor Srđan Mašović.

Founders of Kronor are Kroling, Mont Hidro and Normal Company of Žarko Burić. Founder of Hydro Bistrica are Vodni Zdroje from the Czech Republic, Synergy Podgorica, Gradnja Bijelo Polje and Triangle General Contractors from Kosovo.

For the renewable energy incentives, through the electricity bill, 4.5 million euro was collected last year for owners of the small hydroelectric plants and VE Krnovo, with the latter receiving 2.2 million. Owners of mHE received 295.629 euro in January, evident in data from the Montenegro electric energy market operator (COTEE) delivered to Vijesti.

“In 2018 the January bills were paid and only for small hydroelectric plants,” the COTEE explained. The majority went to Hidroenergija Montenegro at around 165 thousand euro, then Kronor at around 53 thousand euro, Igma Energy 31.5 thousand, Synergy nearly 24 thousand and Hydro Bistrica 21.6 thousand, which began its commercial production of energy in January of this year.

Translated from Vijesti Online, click here for the original.

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