The energy consumption in the Dalmatian region was estimated for residential and public sector, tourism, commercial sector and industry. The national energy program for the use of solar energy, SUNEN, assessed solar energy potential in Croatia. Energy from fossil fuels and electricity consumption in the region, which is mostly used in households for preparing hot water and space heating, could be economically substituted by renewable energy. The situation is most promising for the islands of the Adriatic, where solar thermal collectors, PV modules and wind generators could substitute conventional energy sources in satisfying the present thermal and electric demand. The Dalmatian Islands, characterised by a small density of energy consumption, are proposed as unique candidates in Europe for renewable zones, which could demonstrate the full potential of the renewable energy option. As a practical demonstration, the island of Lastovo and the planned tourist village and yacht marina in the Bay of Jurjeva Luka are proposed as a first solar demonstration project on the islands. Technical, economic, legal and institutional barriers, as well as shortages of financing the project identification process produced hereto an adverse environment for solar applications in Croatia. This paper is an initiative for eliminating the barriers and intensify the solar energy use in Croatia providing the clean environment and activation of indigenous energy resources in the region.