Policies in Croatia

Grid ownership

HOPS d.d. is the sole electricity transmission system operator in the Republic of Croatia, and the owner of the entire Croatian transmission network (400 kV, 220kV and 110kV included voltage levels), and has a licence to carry out the energy activity of electricity transmission as a regulated public service.

HEP operator distribucijskog sustava d.o.o. (HEP-ODS), is the single distribution system operator (DSO) and is responsible for the operation, maintenance, development and construction of the Croatian distribution system.

Roles and responsibilities of the TSO and DSO

The transmission of electricity generated in power plants connected to transmission grid or imported from adjacent power systems, at least cost while maintaining electricity quality standards and safety of the power system at the highest possible level, Control, maintenance and development of high voltage grid.

The distribution of electricity generated in power plants connected to distribution grid or delivered from transmission grid, at least cost while maintaining electricity quality standards and safety of the power system at the highest possible level, qControl, maintenance and development of medium and low voltage grids.

• Regulation on the criteria for conducting a public tender for issuing an energy permit and the conditions for issuing an energy permit
• Electricity Market Act
• Rules on connection to the transmission network
• Rules on connection to the distribution network
• Price list of non-standard services of HOPS and HEP ODS

Connection procedure 

Croatia enacted the new distribution grid connection rules in 2023.

The connection to the grid must be approved by the distribution system operator (HEP ODS d.o.o.). There are two types of procedure for grid connection, depending on the type and size of the plant: the simple connection and the complex connection. Either way, the owner of the RES-E plant has to contact HEP ODS to start the procedure. 

The simple connection procedure is for connecting an electricity-producing plant to a low-voltage network. This is the usual procedure for connecting solar panels (PV) on a house to the grid. The investor must pay the fee for building the connection, which is then built by the system operator. Furthermore, the investor must conclude an Agreement on the Grid Use with the system operator. Finally, when the Agreement is concluded, the system operator activates the connection and issues a confirmation at the beginning of usage of the network. 

The complex connection procedure is for connecting an electricity-producing plant to a mid-voltage network or a low-voltage network for which technical adjustments are required beforehand. This is the usual procedure for connecting a ground-mounted PV farm or another large RES plant. The project developer has to conclude a Grid Connection Agreement with the system operator. When the investor pays the fee for building the connection, the connection will be built. Finally, the investor, or the owner of the installation, must conclude an Agreement on the Grid Use and submit a formal request for the beginning of the grid use in accordance with the general conditions on grid use and electricity supply.

RES

Facilities for the production of electricity from renewable sources with a connection capacity of up to 50 kW are considered "simple connections" to the distribution grid.

If the connection is technically feasible, HEP ODS (the Distribution System Operator) issues an offer for equipping the metering point for billing purposes. Once the payment is made, the user submits a request to change their network user status. Based on this request, HEP ODS issues a certificate of permanent operation along with an updated annexe to the grid usage contract.

A test period is only mandatory for systems that include battery storage or are connected to an aggregator capable of operating independently from the grid (i.e., in island mode).

Self-consumption systems (e.g. rooftop solar for homes) are treated as prosumers and follow a simplified procedure to confirm technical feasibility. If installed on existing buildings, no building permit is required. The final steps include signing a grid usage agreement and receiving confirmation of operation. However, if the system includes a battery energy storage system or is managed by an aggregator, it must still undergo a test period, as such installations can disconnect from the grid and operate autonomously.

Amendments to the Law on Renewable Energy Sources and High-Efficiency Cogeneration allow natural persons to remain within the self-consumption regime even if their annual electricity production exceeds their consumption.

However, if a household generates more electricity than it consumes over the year, the surplus is compensated at a higher tariff, typically applied to business (non-household) users.

In the event of having to limit the delivery of electricity into the grid, the DSO or TSO must enable eligible producers (povlašteni proizvođači) of electricity from renewable energy sources priority access to the grid, if this does not affect the security of the system. To attain the status of a eligible producer, one must satisfy the criteria stipulated in Article 20 of the RES Act, such as: the installation must use renewable energy sources and/or waste and renewable energy sources or simultaneously produce electricity and heat energy in high efficiency manner; the installation must be registered in the Register of Renewable Energy Sources, Cogeneration, and Eligible Producers (OIEKPP Register); the installation must have a connection to the network and installed measurement equipment so that the calculation of net delivered electricity is enabled, etc. According to Article 21 of the RES Act, the decision on obtaining the eligible producer status is made by the Croatian Energy Regulatory Agency (HERA).

Priority to renewable energy

The operator of the transmission system or the operator of the distribution system is obliged, in cases where it is necessary to limit the delivery of electricity from production facilities to the power grid, to ensure priority delivery of electricity to the grid for the production facilities for which they have acquired the status of privileged power producer about other production plants connected to the power grid, unless such priority delivery significantly impairs the reliability and safety of the power system operation.

Consumers of their own renewable energy

Consumers have the right to become consumers of their own energy from renewable sources, individually or through an aggregator, and have the right to:

1. produce energy from renewable sources, including that for own consumption, store and sell surplus of such electricity produced from renewable sources, inter alia through renewable energy purchase contracts, electricity suppliers and mutual trade agreements, without being subject to of electricity they consume or feed into the network, with discriminatory or disproportionate procedures and fees and network fees that do not reflect costs, and about electricity from renewable sources that they produce themselves, which remains within their facilities, with discriminatory or disproportionate procedures and with any fees or fees
2. install and use electricity storage systems in combination with plants that produce electricity from renewable sources for their own consumption, without paying any double fees, including network fees when it comes to stored electricity that remains in their facilities
3. retain their rights and obligations as end customers
4. receive compensation, among other things, when applicable, through a support program for electricity from renewable sources that they produce and feed into the grid, which reflects the market value of that electricity and which can include its long-term value for the grid, the environment and society.

Procedure

The grid operators (both the TSO HOPS and the DSO HEP ODS) are obliged to formulate the grid development plans in accordance with measures and strategies outlined in the Integrated National Energy and Climate Plan for the Republic of Croatia for the period 2021-2030. If the grid has to be further developed, or reinforced, in order to accommodate for a new grid connection, a procedure prescribed by the distribution system operator must be followed, in accordance with the Regulation on issuing the electricity assent and establishing conditions and deadlines for connecting to the grid (OG 7/18) (Grid connection Regulation). This also applies if the grid must be reinforced for the connection of a new RES plant. The procedure is slightly different for simple and complex connections. For simple connections, the distribution system operator decides if further development of the grid is required during the preparation of the electricity assent (EES, elektroenergetska suglasnost – a document defining technical and financial terms of a new grid connection), which is prepared according to the Grid connection Regulation and the Rules on connection to the distribution grid. This is initiated by the investor with the submission of the Request for Determination of Special Conditions and Connection Conditions. The distribution system operator (HEP ODS d.o.o.) issues the electricity assent along with an Offer for connection, which contains the price of reinforcement of the grid to be paid for by the investor. After the investor pays the price of the grid reinforcement and a new connection, the DSO reinforces the grid and makes the necessary connection, along with the signing of the Agreement on Grid Use. For complex connections, the project developer must request and pay the DSO for a Study of the optimal technical solution of the connection (EOTRP). The investor then must sign a Grid Connection Agreement and submit a Request for determination of special conditions and connection conditions, to which the DSO issues an electricity assent (EES) and also signs the Grid Connection Agreement. In the Electricity Assent and the Grid Connection Agreement, the DSO decides if further development of the grid is required in order to accommodate for a new connection and offers a price for the reinforcement of the grid and making of the connection. After the investor pays the price of the grid reinforcement and a new connection and makes a Request for the conclusion of the Agreement on Grid Use, the DSO reinforces the grid, makes the connection, and concludes the Agreement on Grid Use with the investor.

Obligations and rights of plant operators

In accordance with the Electricity Market Act, the TSO must connect all entities, including generators, to the transmission network on a non-discriminatory basis. In addition, the connection must be technically and economically feasible, and the applicant must satisfy the requirements for connection. Limitations to this general rule apply to wind generating stations, which require a certain level of base load. The grid capacity for wind parks, as determined by the TSO, is set to approximately 400MW, out of which 297.45MW is already taken by fifteen operating wind parks, and another 42MW is taken by a wind park that is currently in the test phase. According to the August 2014 published list of the Croatian TSO, the remaining capacity of approximately 81MW is currently reserved for seven projects. A generator must enter into a standard form connection agreement, which determines the obligations of the parties, in particular with respect to the payment of charges and relevant deadlines. The general rule is that the generators are charged the full cost of their connection, which is determined by the actual connection expenditure. This cost must be factored into project development costs for any generation facility connected to the transmission network (all plants with an output of more than 10MW) since the connection cost usually includes the cost of substation construction.

• HROTE
• HEP

1 - Operator distribucijskog sustava d.o.o. (HEP ODS)

Smart Meter Penetration Rate

-    LV-level for businesses 56%, for households 16% 

-    MV-level 99% of metering points equipped with smart meters 

https://www.hera.hr/hr/docs/HERA_izvjesce_2023.pdf

Policies for the digitalisation of the electricity grid

The Croatian primary law that enables both smart electricity and gas metering is the Energy Act.

As per the Ten-year (2024 – 2033) plan for the development of the HEP ODS distribution networkH, EP ODS launched its Smart Grid Pilot Project which aimed to reduce network losses, improve the reliability of electricity supply, and increase the number of users equipped with smart meters. It also aimed to enable the integration of distributed energy sources, especially renewables. Initially planned from May 2018 to December 2022, the project was extended to the end of 2023. It was implemented across five of HEP ODS’s 21 distribution areas and with the objective of developing smart distribution systems at low and medium voltage levels.

The modernisation and development of the smart grid has become one of the key investment areas under Croatia’s National Recovery and Resilience Plan. The pilot project laid the foundation for broader rollout, particularly in terms of advanced metering infrastructure and medium-voltage network automation. The national-scale implementation of smart grid solutions, supported by NPOO funding, is planned from early 2022 to June 2026, aiming to accelerate the deployment of smart grid technologies across the entire Croatian distribution network.

Specific rules for islands, isolated grids, microgrids, local grids, etc.

-    Interconnected islands N/A
-    Non-interconnected islands N/A 

The Electricity Market Act provides a legal basis for the operation of isolated grids, microgrids, and local distribution systems which is particularly relevant for island settings. Article 3(120) defines a closed distribution system as an electricity distribution system located within a geographically limited area with shared services or infrastructure—such as industrial zones, ports, resorts, marinas, airports, or commercial centres. These systems serve multiple users within a confined area.

According to Article 82, operators of such systems are required to formally obtain the status of a closed distribution system if they supply electricity to more than one user. This provision is especially applicable to interconnected islands and multi-user facilities on islands, where decentralised or localised energy systems are common.

How does the tariff methodology account for the deployment of RES? 
RES Act promotes the production and consumption of electricity obtained from renewable sources and prescribes incentive prices and tariffs

Regulation on encouraging the production of electricity from renewable energy sources and high-efficiency cogeneration
Article 5.

(1) At least once a year, the operator of the electricity market conducts a public tender for awarding a market premium and/or a tender for incentives with a guaranteed purchase price within the framework of available quotas for encouraging the production of electricity from renewable energy sources and high-efficiency cogeneration, in accordance with the current regulation establishing the quotas to encourage the production of electricity from renewable energy sources and high-efficiency cogeneration plants.
How does the tariff methodology adapt to islands, microgrids, local grids, etc.?  there are no special incentives for islands
Are any policies being produced to account for such developments?

Ten-year transmission network development plan 2022-2031. with detailed elaboration for starting three-year and one-year periods
EU energy policy encourages the construction of renewable energy sources, a large part of which is connected to distribution network (solar systems, small biomass power plants, MHE, small wind power plants, etc.). Right now in the Republic of Croatia, there is great interest in the construction of renewables that will be connected to the distribution and transmission network, primarily wind power plants, solar power plants, biomass or biogas power plants, and cogeneration plants power plants. The intensity of their construction and the total size will depend on the state's energy policy and amounts subsidy for their production.

Looking at distributed sources of electricity together with the effects of energy efficiency policy, can be expected to reduce the load (consumption) through individual hubs of the 110 kV network, and thus up to as a result of reduced loads on individual high-voltage lines. This plan takes into account the current level of integration of renewables, and future projects for the construction of wind power plants and other renewables of the planned connection mainly on the transmission network, and also analyzes the effect of distributed sources and consumption reduction
for measures to implement energy efficiency as defined by the new energy strategy
development. 

At the current moment, the smaller renewabales connected to the distribution network do not significantly affect the required one development of the transmission network, but in the long term it is expected that a large number of distributed sources of electricity
energy combined with a greater number of renewables (wind power plants and solar power plants) connected to the transmission network could lead to until the need to strengthen certain lines of the 400 kV network, especially between the southern part of the EES and the wider Rijeka areas. The problem of integrating renewables into the transmission and distribution network is continuously monitored and analyzed in HOPS and the results of all analyzes are implemented in development plans.

Are there existing caps for RES installed capacity in the network?

In principle, there is no limit.

As per Article 72 of the Electricity Market Act,  the distribution system operator may not refuse the connection of a new production facility or energy storage facility on the basis of possible future limitations of available network capacities, such as congestion in remote parts of the distribution network.

Article 88 of the Electricity Market Act provides that:

(1) The transmission system operator establishes transparent and effective procedures for the non-discriminatory connection of new production facilities and energy storage facilities to the transmission system by the rules from Article 13, paragraph 1 of this Act.
(2) The transmission system operator may not refuse the connection of a new generation facility or energy storage facility on the basis of possible future limitations of available network capacities, such as congestion in remote parts of the transmission network.
(3) During the connection procedure, the transmission system operator is obliged to provide the investor with all necessary information.
(4) As an exception to paragraph 2 of this article, the transmission system operator may limit connection power or offer connections that are subject to operational restrictions on the use of connection power in order to ensure the economic efficiency of new production facilities or energy storage facilities, provided that such restrictions have been approved by the Agency. New production facilities or energy storage facilities that are subject to operational restrictions on the use of connection power in accordance with the rules on congestion management in the transmission system, independently bear the costs incurred by the transmission system operator related to the implementation of these operational restrictions.
(5) When giving consent to the rules on connection to the transmission network from Article 13 of this Act, the network rules of the transmission system from Article 93 of this Act and the rules on congestion management in the transmission system from Article 52 of this Act, the Agency is obliged to consider whether they introduce are connection power restrictions or operational restrictions on the use of connection power based on transparent and non-discriminatory procedures in order not to create unjustified barriers to market entry.
(6) The operator of the transmission system may not refuse connection to the network due to the additional costs of creating technical conditions in the network.

Article 19 of the RES Act provides:

(3) By decree, the Government of the Republic of Croatia establishes quotas for encouraging the production of electricity from renewable energy sources and high-efficiency cogeneration plants until 2030, for the purposes of implementing the public tender referred to in Articles 22 and 25 of this Act.

What are the curtailment rules for RES generation? same as for others. 
there is a term “operational limit of power” that is only mentioned in the law but is not used in practice.  Current legislative developments are moving towards prescribing a wider use of such practice in the future due to developments with new plants

Article 72 of the Electricity Market Act provides:

(16) As an exception to paragraph 14 of this article, the distribution system operator may limit the operational limit of power use in order to ensure the economic efficiency of new production facilities or energy storage facilities, provided that such restrictions have been approved by the Agency.

Article 18 of the Rules for congestion management within the Croatian EES (HOPS - 4/2021) provides that in the case of restrictions on privileged producers of electricity, the transmission operator
of the system reports to NRA in accordance with the current RES Act

Article 34 of the RES Act provides:

(2) The operator of the transmission system or the operator of the distribution system is obliged, in cases where it is necessary to limit the delivery of electricity from production facilities to the power grid, to ensure priority delivery of electricity to the grid for the production facilities for which they have acquired the status of privileged power producer in relation to other production plants connected to the power grid, unless such priority delivery significantly impairs the reliability and safety of the power system operation.
.
(5) In case of major restrictions in the delivery of electricity to the power system produced from renewable energy sources and high-efficiency cogeneration, the operator of the transmission system or the operator of the distribution system must notify the Agency within 24 hours.
(6) The notice referred to in paragraph 5 of this article includes an explanation of the restrictions on the supply of electricity to the power system from renewable energy sources and high-efficiency cogeneration, as well as descriptions of the measures that the transmission system operator or the distribution system operator intends to implement in order to remove these restrictions, with the Agency assessing the justification of the restrictions and the appropriateness of the proposed measures and can make a decision determining the measures to remove the mentioned restrictions within its jurisdiction.
(7) An appeal against the decision of the Agency from paragraph 6 of this article is not allowed, but an administrative dispute can be initiated.

Who is responsible for voltage balancing, frequency reserve, unit dispatching, electrical system management?  

HOPS 

Who has access to metering data?   

• TSO
• DSO
• NRA
   

• HEP - Opskrba d.o.o.
• HEP - ELEKTRA d.o.o.
• GEN-I Hrvatska d.o.o.
• E.ON ENERGIJA d.o.o.
• PETROL d.o.o
• MET Croatia Energy Trade d.o.o.
• ENNA Next d.o.o.
• Axpo Trgovina d.o.o.
• SOLARIS PONS d.o.o.