The NTC Gaj 2 MW biogas unit in Lipik, Croatia, has closed as a result of the doubling of prices for raw materials for biogas facilities over the past year, according to Balkan Green Energy News.
The biogas plant became operational just three years ago, with Germany based North-tec Consult investing €9m.
“Since state institutions responsible for the energy sector did nothing to increase the price of electricity but give empty promises, we weren’t able to pay for raw materials to suppliers and we were forced to close the facility,” said Peter Maierhofer, owner of the NTC Gaj 2 MW unit.
In January, the Renewable Energy Sources of Croatia association (OIEH) warned that biogas plants are close to collapse.
Unless Croatia's government provides urgent assistance to the sector, 70% of the capacity will need to be shut down, OIEH said. The NTC Gaj 2 MW unit is the first to file for bankruptcy.
Maierhofer went on to say that the firm would have filed for bankruptcy one year ago, had he been aware that negotiations would be unsuccessful and that the price of electricity would not be raised.
It had demanded the sector be exempted from the price cap mechanism and introduce a bonus to avoid losses.
The European Union’s REPowerEU plan envisages the expansion of the sector’s capacities to 35 billion cubic meters of biomethane per year, which would completely replace Russian gas imports, the organisation observed.
Several units have annulled contracts with the Croatian Electricity Market Operator (HROTE) for feed-in tariffs at €170 per MWh to see if they can survive in the open market.
There is 26 MW installed in total in Croatia in biogas-fired power plants. NTC Gaj remained in the feed-in tariff scheme.
Croatia has limited power purchase prices for privileged producers at €180 per MWh. Any additional income is directed to the Environmental Protection and Energy Efficiency Fund. The current measures are set to expire at the end of June.
The European Commission has asked member states to phase out energy support measures to stave off inflation. Energy prices have dropped to the lowest levels in two years, where they were when the energy crisis was gaining momentum.