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Kosova e Re lignite power plant, Kosovo

Kosovo currently wastes the majority of the electricity it produces in its two filthy lignite plants: 37 percent is lost through technical losses and theft and another 30 percent is wasted through lack of energy efficiency measures. Yet the Kosovo government, heavily backed by the US government and World Bank, plans to build a new 600 MW lignite plant, Kosova e Re or New Kosovo.


The Kosovo A power plant near Prishtina (Original image by Andreas Welch - Creative Commons)

Plans to build a new coal plant close to capital Prishtina have been around for over a decade, starting out as a planned 2000 MW unit that would turn the country into the leading energy exporter for the Balkans. Yet, lack of investors and resistance to a massive lignite project in a country that already has the highest single point-source of carbon emissions in Europe have gradually diminished ambitions. Today, Kosova e Re is planned to have a capacity of 600 MW, costing around USD 2 billion, and it is being heavily promoted by the World Bank and by the US. Since Kosovo became a member of the EBRD in December 2012 the bank has also indicated its interest in the project.

Civil society groups in Kosovo, led by the Kosovo Civil Society Consortium for Sustainable Development (KOSID) oppose the construction of a new power plant for the following reasons:

1. It is unnecessary. Reducing electricity losses and investing in efficiency and alternatives are cheaper and create more jobs.

While the plant is being depicted as necessary to ensure the country’s energy security, up to 30 percent of available electricity in Kosovo today is wasted according to official data, because of lack of energy efficiency programmes. This adds to the 37 percent of electricity losses (of which around 17 percent are technical and a result of an old grid and the other are commercial losses, i.e. theft). Daniel Kammen, Professor at the University of California in Berkeley and former World Bank 'Clean Energy Czar”, has shown (pdf) that Kosovo has renewable energy capacities that could deliver 34 percent of energy demand by 2025, while providing over 60 percent more jobs than a business as usual path, with estimated cost savings of 5-50% relative to a scenario that includes a new coal power plant. If energy efficiency programmes are put in place, losses are curbed, renewable energy is developed, and the existing Kosovo B plant is rehabilitated, the study finds, there is no need for a costly new plant.

2. High costs

Building Kosova e Re would require Kosovo consumers (or the government) to service over a billion euro in debt (Source (pdf)) at a time when they are also servicing debt for improvements in the Sibovc mine, Kosovo’s wasteful transmission and distribution systems, and refurbishment of Kosovo B.

In recent months there have already been several protests in Kosovo about rising electricity prices, and a new coal plant would only increase prices further.

3. Damage to health

Kosovo currently has 835 early deaths per year and estimated direct costs of around EUR 100 million annually due to air pollution, of which the lignite plants are responsible for a substantial proportion. (Source: World Bank (pdf))

However, far from solving this problem, a new lignite plant would perpetuate the health risks from coal for several more decades. Due to the location where the Kosovo e Re plant would be built, it is likely that emissions will exceed EU ambient air quality standards, even if Kosovo B and Kosova e Re meet EU emission standards. No reliable air quality monitoring is taking place, so it is difficult to prove that air quality would be acceptable with a new plant.

4. Kosovo needs to increase renewables and energy efficiency and decrease CO2 emissions

By 2020, Kosovo has committed through the Energy Community to source 25 percent of overall energy from renewable sources and improve energy efficiency by 9 percent. And as the country is aiming to join the EU, it will have to adhere to ever stricter CO2 reduction targets (likely to be 80-95 percent for the EU as a whole by 2050). This one coal power plant alone will likely swallow up most of the country's carbon budget by 2050, leaving a choice between closing the plant earlier than planned or paying penalties.

5. Water shortage

Kosovo is already water-stressed and its water polluted, and a new plant would add to the problem. A recent paper by Bank Information Center and KOSID shows that the water modelling for the project miss out several factors including water use by the expanded open pit coal mining operations and conveyance of coal from the mine to the power plant, as well as the impact of a new plant on water pollution.

6. Resettlement and agricultural land shortages

A new power plant would require a new mine, and this will require resettlement, the scope of which is to be defined in a new study. However this is complicated by the fact that many of the people are farmers and need to be provided with adequate land to compensate for their lost livelihoods, and agricultural land is in very short supply in Kosovo.

This raises further questions about whether it is better to use scarce land for opening a new mine or feeding people. The resettlement that has occurred so far has been in breach of any known international standards for resettlement. KOSID is currently undertaking a thorough review of resettlement process related to the Kosova e Re plant.


For more information contact

Visar Azemi, KOSID Co-ordinator
or
Pippa Gallop, Bankwatch Research Co-ordinator

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Latest developments


 

Blog entry | March 18, 2014

When it comes to Kosovo's energy future, institution after institution has been putting most of its eggs in a 'new lignite' basket while some very reasonable alternative investment options seem to fall by the wayside.

Blog entry | March 12, 2014

Environmentalists and public finance watchdogs are taking to twitter today to urge World Bank president Dr. Jim Yong Kim to head his own rhetoric and reject the Kosovo coal power plant.

Blog entry | January 28, 2014

When Dr. Kim, President of the World Bank, and leaders of other international financial institutions ponder funding new coal power projects this year - like the one in Kosovo - there's one word that should be seared into their memories: Sostanj.

Press release | December 10, 2013

The European Bank for Reconstruction and Development (EBRD) approved today during a vote of its Board of Directors a new Energy Strategy. The document is meant to give guidance on how to strategically use the bank’s resources over the next years to promote energy security and affordability and avoid dangerous climate change.

coal, energypolicy
Blog entry | November 22, 2013

United in spirit with yesterday's blog post on the European Bank for Reconstruction and Development's coal lending, Visar Azemi from the Kosovo Civil Society Consortium for Sustainable Development calls on the UK government to not support the Kosova e Re lignite power plant via the World Bank and make its promise to end overseas coal financing a reality.

Publications

Bankwatch Mail | March 20, 2014

The EU-backed Energy Community Treaty, signed in 2005 and comprising the western Balkan countries, Ukraine and Moldova, has been widely hailed as encouraging regional co-operation. It also sets a legislative framework for the signatories (also known as the contracting parties) that should contribute, along with the EU accession process, to addressing the environmental and social impacts of the energy sector. Indeed, examples of the Energy Community's added value are its adoption of renewable energy targets in October 2012, as well as a requirement for power plants to comply with EU emissions limits.

Bankwatch Mail | March 20, 2014

Ideas about the construction of a new lignite power plant in Kosovo have existed since the end of the 1980s, and even the current Kosova e Re proposal – scaled down to 600 MW from the original 2100 MW – has been around since 2009. It is being touted by the Kosovo government, the World Bank, USAID and the European Commission among others as the only realistic option to replace the ageing and heavily polluting Kosovo A power plant.

Briefing | October 21, 2013

The Western Balkans countries are aspiring to become members of the European Union. On 24 October the Ministerial Council of the EC-backed Energy Community will approve a list of priority energy infrastructure projects resulting from the Regional Energy Strategy known as Projects of Energy Community Interest (PECIs) for the Western Balkans, Moldova and Ukraine. These projects would be prioritised for fast-track approval and public financing.

Study | June 25, 2013

South-eastern Europe is riddled with poor planning and corruption in the energy sector and its governments are proving slow to react to the challenges and opportunities offered by the decarbonisation agenda.

Bankwatch Mail | May 10, 2013

The findings of a recent report entitled ‘The unpaid health bill: How coal power plants make us sick’, released by the Health and Environment Alliance (HEAL), detail the health impacts of existing coal in Europe and quantify the associated costs of mortality and chronic respiratory and cardiovascular disease due to coal pollution.