96 PERSPECTIVES ON BUSINESS AND ECONOMICS | VOL 44 | 2026 ready begun. However, recent right-leaning political shifts have slowed exploration of liquid hydrogen and ammonia as future fuel sources. To signal future directions in these areas, most EU nations have released strategic policy documents, but much remains hypothetical. If Croatia begins exploration in these fuels immediately, it could propel competitive advantages relative to other viable future hydrogen or ammonia exporters. High offshore renewable capacity Significant offshore renewable potential remains unexplored, in particular wind power. Grid modernization is necessary for solar, but the NECP dedicates €783M for renewable energy adoption within the next decade (Ministry of Economy…, 2025), including solar and wind. The revised NECP also establishes a committee for the construction of SMRs to reinforce the existing renewable mix (Ministry of Economy…, 2025). SMRs have the advantage of reproducibility, but the extensive processes required for environmental and land use approvals may stall any emissions effects until after the 2030 EU threshold. SMRs remain prohibitively expensive, regardless if they are developed domestically or contracted from foreign firms. Renewables are notoriously difficult to scale, and sources reliant on variable natural phenomena need to be patched together with other sources, alongside solutions for storing energy generated during nonpeak periods, making early investment critical. Conclusion and policy discussion Despite the controversy surrounding its construction, the Krk terminal represents a genuinely consequential investment for Croatia’s geosecurity and its economic positioning in CEE. It ended two decades of net energy importation and insulated Croatian and regional gas markets from Russian supply manipulation (Austvik, 2016; Stern et al., 2009); preliminary evidence suggests it may have moderated electricity prices relative to comparable nations, even amid the extraordinary disruptions of the 2022 energy crisis (Stelzenmüller & Gross, 2024). As pipelines expand and re-export volumes grow, Croatia’s role as a regional energy hub no longer is aspirational but operational (Fabian, 2025; Karasalihović Sedlar et al., 2023). Yet the strategy that delivered these gains carries compounding risks that Croatian energy policy has so far neglected to seriously address. As noted previously, the environmental costs of LNG are higher than officially estimated, not because the terminal itself has meaningfully disrupted local marine life or soil erosion but because LNG infrastructure is poorly managed and fugitive methane emissions are systematically undercounted by methodologies that do not rely on active measurement The patron–client dynamic underlying American– Croatian energy cooperation has delivered results, but it is not a substitute for energy sovereignty. The geopolitical rationale for LNG is sound but has effectively substituted one form of import dependence for another. The variability of American foreign policy means that the security gains from diversifying away from Russia are partially offset by a new exposure. The goals of energy hub status, climate compliance, and energy security are not mutually exclusive; even so, pursuing all three requires deliberate choices that Croatia has so far deferred. Several priorities stand out. While the NECP nuclear development and renewable targets are promising, Croatia has a documented history of setting ambitious explicit goals; at the same time, its implicit investment flows tell a different story (Accelerate…, 2024). Maintenance of legacy gas infrastructure and enforcement of methane emission regulations should be treated as urgent rather than administrative. The environmental case for LNG as a transition fuel collapses if fugitive emissions remain at current levels (CATF & Greenpeace, 2025; Greenpeace Croatia, 2025). Repair of leaking infrastructure also is among the cheapest emissions reductions available (United Nations Environment Programme, 2022). Early investment in renewables is critical precisely because it is expensive and slow, and cheap fossil fuels crowd out innovation and entrepreneurship (Acemoglu et al., 2023). Similarly sized nations that have been successful in renewables, like Denmark, Lithuania, and Uruguay, demonstrate that the acceleration for renewable energy systems is complex but achievable with intentional investment, meaning grid modernization needs to be considered as soon as possible. Croatia should not assume that existing renewable infrastructure will scale proportionally to meet 2030 and 2050 targets without deliberate, front-loaded investment (Accelerate…, 2024; Jaeger, 2023). The Krk FSRU provides a rare and time-limited opportunity to begin planning conversion to climate-neutral energy carriers. Liquefied ammonia and hydrogen are alternative clean fuels that use the same technology as LNG for storage and infrastructure. Ammonia conversion is technically and economically more feasible than hydrogen, reuses the most expensive existing infrastructure, and positions Croatia within emerging European ammonia and hydrogen trade networks (Riemer et al., 2022). Initiating this
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