The National Assembly has passed a controversial reform energy bill, ending months of heated debates centred on provisions on the burning of natural gas and wood. While a ban on gas boilers in new homes has been retained despite protests from the industry, a ban on wood was thrown out.

The legislation, passed on 23 April, sets the framework for national energy policy by providing incentives and limitations as the country transitions to energy sources other than fossil fuels.

But the bulk of the debate was dedicated to the ban on biomass and gas boilers in dense urban areas, and new concessions for natural gas distributors, which will be severely restricted.

Heating turned into campaign issue

The smaller of the two opposition parties, New Slovenia (NSi), seized on these provisions to launch a broad campaign decrying the government's selected green transition path under the motto "We're not giving up wood".

As a result, the provision on biomass, the main source of heating in many homes, especially in rural areas, has been removed from the bill.

Having turned the freedom of choice how to heat your home into a major issue in the run-up to the EU election, the NSi party still filed for a referendum on the bill, but the coalition majority voted the proposal down.

Ban on gas boilers in new homes

Meanwhile, investors who apply for building permits after 1 January 2025 will not be allowed to install natural gas or heating oil boilers, and restrictions on new natural gas concessions have remained intact.

Thus local communities will no longer be allowed to grant new concessions for the construction and management of gas distribution networks, unless the providers can demonstrate that at least 80% of the gas can come from renewable sources.

Existing concessions can be extended under very strict conditions, and for no more than five or seven years, depending on the conditions.

The five-year extension is possible for example if there are customers in the area concerned with an annual consumption of over 100,000 kWh who use gas to produce goods or services and have no alternative energy supply or if such supply was disproportionately more expensive.

The first concession to expire will be in Maribor in 2027, while some are valid through 2050.

The ban comes despite protests by gas distributors, who say the bill is harmful and will not contribute to the green transition in any way. They claim parts of the law are in violation of the Constitution.

The government says the overhaul of the energy legislation is needed because of the green transition of the energy sector and the need for systemic solutions on energy supply in the face of the energy crisis and price hikes.

Nuclear as low carbon source

The bill deals with energy policy management, the operations of the energy regulator, energy infrastructure, inspections, granting of subsidies for investment in renewable energy sources and efficient energy use, and management of investments.

Nuclear energy, hydrogen, synthetic gas and excess heat are listed as low carbon energy sources. The mention of nuclear in particular is seen as very important, coming after the government had been accused of failing to throw its weight behind nuclear.

The bill sets in more detail the priority use of energy sources to encourage the use of renewables and boost the energy efficiency of buildings and devices.

A new concept of decarbonisation on the local level is being introduced under which municipalities will need to have plans for abandoning fossil fuel for heating and set their targets on efficient energy use and renewables.

They will also have to make plans for managing energy poverty in their region.

Simplified procedures have been put in place for drawing money from the EU's Just Transition Fund for the revitalisation of the Šoštanj coal-fired power plant and the Zasavje coal region.

A new instrument will be introduced providing complementary financing for the green transition projects that are successful in EU tenders.