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Croatia: RP Global Austria wind park adventure and IFC financing

, Investors

RP Global Austrian holding wind park project, financed by IFC, is the first RES project in Croatia which could be considered as success case story of one bank and private investor.
RP Global Austria Danilo wind park with an output of 43.7 MW, is the largest operational wind park in Croatia and the Western Balkan region.

It was constructed in 2013 following commissioning of the turbines, an extensive testing period, as well as a technical exam.

All necessary permits and approvals were issued in July 2014. As of July 16, 2015, this wind park is in full commercial operation.

This is the first wind farm in Croatia to be developed and implemented by the Austrian based holding company, RP Global, which began its activities in Croatia in 2002.

After a preliminary analysis of the market, RP Global detected several possible locations of interest on the Croatian coastal region meeting the following key criteria: projected high wind potential based on available data ; possible grid connections; assenting local community; accessible site ;suitable area for a >30 MW wind farm; existing patial plan; and no activities of other companies on the same site.

Before the end of 2004 the first documents for the EIA and the Grid Connection Study were prepared.

According to local RES association one of the most important principles during the development phase is balancing investment in development with the risk that the project will not ultimately be implemented for whatever reason.

The Environmental Impact Study process is the most time consuming and costly process in the early stages of development, which is why RP Global tried to complete the documents concerning the analysis of crucial environmental issues in a swift and timely manner.

Bird monitoring was one of the main activities that had to be undertaken, because findings in this regard could have potentially stopped the project.

In the later stages of development, bat monitoring also had to be undertaken as a condition requested by IFC before financial closing.

In late 2009 when the Danilo project finally obtained its location permit, a new challenge arose with HOPS, the Croatian Transmission Line Operator which wanted to test a new scenario by dividing the construction of the substation into two separate stages, requiring two building permits to be issued.

As part of this process, RP Global was required to sign a pre-grid connection contract; transfer the initial funds; and publish a proposal for the final grid connection Study. In the meantime, RP Global was issued a new location permit, started preparation of the documents for the building permit, and utilised a Wind Energy Converter to choose the most suitable turbine for this site.

These time consuming procedures lead to a long development period and negative consequences for the project, namely old technology, because basic approvals and permits were issued for a specific turbine type which
was not the most up-to-date technology several years later when installation begins.

Negotiations with the banks for the financing of Danilo commenced in late 2011, with due diligence commencing in early 2012, implementation of the first wind farm in Croatia became a foreseeable reality for RP Global.

March 26,2013 will be fondly remembered as the date when the construction of Danilo commenced. Construction was finished in eight months, more than three months ahead of schedule, and within budget
which was a significant achievement. The Danilo Wind Farm has produced 100 GWh over the past year.

From an investor and developers’ point of view, while RP Global is considered in Croatia as a success case story with its achievement, according to RP Global statements the environment for renewable energy project development in Croatia should be significantly different.

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