InvestSlovenia

ENERGY

Internationally comparable strengths of Slovenia’s energy sector:

Diversity of sources in electricity generation

Liberalization of the electricity market

Favourable trading position in electricity

Favourable energy prices

Legislation in compliance with the EU standards and norms

Potentials to increase hydro-power use

Import energy dependency

Energy consumption per capita

Energy consumption per capita, 2001

Source: Statistical Pocketbook: European Union Energy & Transport in Figures (2001)

Slovenia is an energy dependent country, importing almost all of its oil and gas. Its energy dependency reached 56% in 1998. Its own sources consist of lignite and sub-bituminous coal, used primarily for power production. Hydropower is also an important source, whose share will increase with future investments. The share of coal will further reduce due to the closure of the main coal mine by 2007.

Import dependency of energy, 1998

Source: Annual Energy Review(2001)

End-user energy prices have long been below EU levels. This has induced high energy consumption intensity. Since 1995 prices have gradually increased as a result of a more firm governmental commitment to bring them in line with the EU-15 average prices. Electricity prices have increased by around 15 percentage points (from 65% of the EU-15 average at the end of 1995 to 80% in July 2002). End-user oil prices have come closer to the EU-15 average by increasing excise duty, although they are still between 77.5% and 93% (depending on the oil product) of the EU-15 average.

Average electricity prices for industry, 1999

Source: UNIPEDE: Electricity Outlook (1999); Energy Prices & Taxes (2001); Ministry of the Environment and Spatial Planning of the Republic of Slovenia: internal documents (2001)

The Slovenian energy sector is undergoing significant changes from the natural-monopoly dominated by supply-side engineering management, to the more competitive customer-oriented industry.

Liberalisation of the electricity market, end 2000

Source: Statistical Pocketbook: European Union Energy & Transport in Figures (2001); Ministry for the Environment and Spatial Planning of the Republic of Slovenia (2002)

One of the main future challenges for Slovenia will be a sustainable energy supply at competitive prices, energy efficiency, and meeting EU climate emissions targets in line with the Kyoto Protocol. Measures engineered for pollution abatement and control, protection of biodiversity and landscapes, mobilisation of natural resources, and prevention of natural and technological risks are high on the priorities list.

In 2002 the concession was given to the holding of electricity producers to build five plants on the Sava River with combined power generation of 180 MW. It has also modernised and upgraded the chain of hydropower plants partly by financing provided by the EBRD. Enlargement of the transmission and distribution network is also envisaged. The long-term plan until 2010 envisages the construction of 163 km of 110 kW lines, 5,100 km of 20 kW lines and 1,100 km of 400 kW lines. Thanks to regular maintenance and the recent replacement of the two steam generators in Slovenia’s only nuclear power plant has extended its useful life until at least 2023.