Blog entry

In Slovakia, a shining example of EU funds for renewables and families

In a 2018 review of the Slovakia’s energy policy, the International energy agency (IEA) confirmed the tragic situation. System operators stopped in 2013 accepting requests for connecting renewables above 10 kilowatts to the distribution grid because of concerns over grid stability and security of supply. This regulatory measure still applies. In addition, Slovakia plans to meet its national renewables target mostly with unsustainable biomass, placing pressure on the stability of the country’s ecosystems.

In spite of these challenges, promising signals suggest that maybe Slovakia will right its policy framework for renewables, and EU funds will play an integral role. The Ministry of Environment and the Slovak Innovation and Energy Agency (SIEA) have begun distributing EU funds for photovoltaic, photothermic, heat pumps and sustainable biomass boilers up to 10 kilowatts in a programme called ‘Green to the households’.

This has enabled family and residential houses not only to connect solar panels directly to the grid but also receive subsidies for their installation. Priority is given to installations with the highest use of produced electricity through the accumulation of electricity to support the stability of the electricity grid. Surplus electricity is supplied free of charge into the distribution network. Wind installations were not supported due to current legislative restrictions. So, no household could get support for a small wind turbine.

While Slovakia has had difficulties in using EU funds for sustainable development, the ‘Green to the households’ programme is a shining example for its rapid deployment. For example, SIEA distributed EUR 1.78 million through 786 vouchers in just eight minutes in one round in August 2018.

The total budget for these activities is EUR 115 million plus national funding. The first pilot project with a budget of EUR 45 million lasts from 2015 until the end of 2018, and the successful project is planned to continue in the next years.

Hope for larger solar installations

In October 2018, the Slovak parliament amended the law on renewable energy sources and combined heat and power. The renewables sector succeeded in the first area with a so-called ‘local power generation,’ which will enable installations of up to 500 kW to be connected to the grid for their own electricity consumption. This solution suits mostly small and medium enterprises. Feed-in-tariffs will be changed to auctions and feed-in-premiums. Slovakia still lacks data about the technical potential of renewables, transparency and proper participation in decision and policy making, not mentioning other struggles in the CHP sector.

More efforts needed

The IEA continues in its 2018 review:

“These EU-level targets appear to lack ambition and may not serve the country to trigger progress towards the 2050 long-term decarbonisation goals. The IEA encourages the Slovak Republic to set more ambitious national targets and continue to reap multiple benefits from reducing energy-related CO2 emissions.”

The agency recommends that Slovakia:

Assess the technical and economic potential of individual domestic sources of renewable energy, taking into account environmental sustainability, and design promotion policies on that basis; ensure that the biomass used is from sustainable sources.
Require the DSOs to analyse how to prepare the electricity system to integrate higher shares of solar and wind power, for example by looking for international best practices.

EU funds, as a significant source of public investments, can contribute to the necessary energy transformation for the protection of climate and biodiversity and support of the local economy.

Coal supplied by Hungary’s BAZ county mines to blame for growing air pollution

Unlike Romania or Bulgaria, Hungary has not been referred to the EU Court of Justice for failing to implement the air quality legislation. But a quick visit to BAZ county – Hungary’s coal heartland – suggests the air pollution problem persists just as well in Hungary.

Sajókápolna is a small village in the centre of BAZ county in north-eastern Hungary. The entire region has a long tradition of coal mining, with dozens of underground and open-cast coal mines operating throughout the last two centuries. Coal is also one of the main energy sources for household heating in smaller settlements, which inevitably results in deteriorating air quality.

We monitored the air quality in Sajókápolna over a 28-day period. During the observed time, the EU 24-hour average limit of 50 micrograms/m³ for coarse particles (PM10) was exceeded on 5 days. It may not sound like much, but the EU Directive on Ambient Air Quality actually allows only 35 exceedances in a year. With additional mines in the pipeline, the air quality will most certainly worsen.

For fine particles (PM 2.5), the EU Air Quality Directive does not have a 24-hour average limit, only an annual one, which in theory should never be crossed. The World Health Organisation, however, does have a 24-hour average limit of 25 micrograms/m³ and this limit was breached on 18 days, or 64 % of the observed time.

The high percentage of fine particles (PM2.5) indicates that the biggest contributors to air quality deterioration in the village are local households that heat their houses with coal (which is provided at a low price). In fact, the sole consumer of Sajókápolna coal is local communities.

Even in a remote village surrounded by forests, the level of air pollution is not in line with the EU and WHO recommendations.

With the official shift in EU policies towards clean and renewable energy, there were hopes that the region would slowly move away from coal, but plans to open new coal mines keep resurfacing.

Sajókápolna is no exception, with its latest open-cast lignite mine just a hundred meters away from residents’ houses. The close vicinity of the new mine provides villagers with easy and cheap access to coal. At the same time, it doubles local people’s exposure to polluting particles and dust: not only do they burn coal in their inefficient boilers, but they also breath in coal particles produced during coal excavation and transportation. What is even more troubling – two more mines are planned nearby.

Air pollution in the Balkans – independent monitoring

With our own particulate matter (PM) measuring device, we aim to provide independent data on air quality in a few selected sites in the Balkans.

For every citizen to have access to clean air, the whole energy sector of the country must be considered. Individual household heating practices should be included in the energy transformation of the country, as they constitute an important part of the decarbonisation process.

This is addressed in the BAZ County Climate Strategy. The fact that burning cheap lignite for household heating damages air quality and seriously contributes to greenhouse gas emissions is generally acknowledged, but not acted upon. So far, the local government has been persistently ignoring the issue. No wonder air pollution levels in the region regularly exceed the EU’s daily and annual limits.

Local environmental NGOs and community members demand:

a review of the air quality plan at the regional Governmental Office
a national- and EU-level assessment of regional climate strategies
a review of climate protection action plans
a ban on the sale of lignite for the public
a transition towards cleaner options for individual household heating, with significant support for heating renovation targeting the energy-poor.

As human rights declaration turns 70, development banks have a ways to go to respect and protect rights defenders

[1] Open letter

Since the adoption of the Declaration on Human Rights Defenders (HRD) twenty years ago, an estimated 3 500 human rights defenders have been killed because of their peaceful work defending the rights of others. In 2017 alone, at least 312 human rights defenders were murdered, 67 percent of whom were working in defense of land and territory in the context of large investments, extractive industries and big business.

States and big businesses are often behind rights violations. Large infrastructure and development projects are pursued in the name of state interest and in disregard of the human rights of locals. The same governments who have signed the Universal Declaration of Human Rights are shareholders in international institutions that were created to promote development, yet are far from being supporters of human rights.

In recent decades, some human rights considerations have made their way into the safeguard policies of these institutions in the form of social and labour rights guarantees. But such measures are not sufficient for development banks, as they operate in countries where human rights are systematically violated and locals do not have freedom to speak up for their rights. Both the European Bank for Reconstruction and Development and the European Investment Bank have improved their policies designed to protect the rights of potentially-impacted peoples, but there is still more to be done.

Project affected people need to be involved in an informed and meaningful process of planning and decision-making at the earliest stages of project development. Once investments have caused harm, the banks’ accountability and redress mechanisms must provide effective redress in a way that does not put complainants at additional risk.

Years of monitoring international finance have given us insights into these problems and at the same time, demonstrated the courage of human rights defenders who stand up to protect the rights of entire communities. These brave people often face threats, humiliation and even violence in spite of not receiving necessary protections from the state. This is the case in eastern Europe and especially so in Central Asia.

The EBRD and EIB operate in countries where human rights violations are systemic. In such an environment it is impossible for the banks to fulfil their policies on public engagement and human rights protection.

The EBRD has a detailed methodology for assessing a country’ commitment to democracy, pluralism and respect for human rights and is encouraging political and economic reforms through a “more for more”, and conversely “less for less” approach to investment. In cases like Uzbekistan where the country’s international partners have expressed cautious optimism about on-going reforms, the EBRD should go the extra mile and conduct proper human rights due diligence on all its investments. In countries like Turkmenistan, where there is no sign of progress, the EBRD should be clear to the government of what ‘less for less’ means and scale down all forms of investments towards halting operations entirely.

Even in the relatively open democracies of this region, the violation of human rights as part of infrastructure developments is still a reality, and the ability of staff at the public banks to respond is limited, given the tools at their disposal. In Ukraine, Bankwatch follows a number of cases where local activists are under pressure for opposing industrial agribusiness. While an independent audit organised by the EBRD pointed out the need to improve communication with impacted communities, the bank is limited in the leverage it can exert over its client. In Georgia, the native Svan population has continually opposed plans of the government to build dams that would force their displacement, and as a result have been the subject of intimidation and harassment.

A positive development at the institutions, as seen recently at the International Finance Corporation, has been the formulation of ‘no tolerance to retaliation’. The IFC has recently released a statement expressing intolerance of any action by an IFC client, which amounts to retaliation- including threats, intimidation, harassment, or violence. This is an important step, not only to minimize risk in project implementation, but also to ensure that stakeholders are able to engage freely and safely with the IFC and its clients to ensure positive project outcomes. To avoid and mitigate potential risk of retaliation, the EBRD and EIB must develop internal guidance on integrating assessment of such risk into its project assessment procedures. This would involve analysis of the political and economic operating context, and awareness raising among Bank and client management.

The upcoming revisions of the safeguard policies at the EBRD and the EIB offer an opportunity to mainstream during the appraisal of a project an assessment of how human rights are being respected by the client.

A lack of protection for human rights defenders undermines the effectiveness of a bank’s grievance mechanisms, as it is too risky to submit complaints. The revision of the EBRD’s accountability policy therefore should in addition ensure that its Project Complaints Mechanism is independent and safe for human rights defenders and communities who request redress for harm done by bank investments.

While we welcome steps taken by some states to support and protect rights defenders, it is concerning that governments may actually be undermining these efforts through the actions of their national development banks, bilateral development cooperation, and other development financial institutions in which they participate.

European Parliament warns Balkan countries to stop destructive hydropower

The Resolution on Montenegro asked the banks “to withdraw funding for all projects which are undertaken in protected areas” while the one on Albania asks for a review of the projects that “lack sound ex ante strategic environmental assessments and environmental impact assessments”. All other Resolutions on Western Balkans countries (namely Serbia, Kosovo and Macedonia) include strong language emphasising the risks that hydropower bring if the strictest EU environmental standards are not applied.

The Parliament’s stance is not the only recent example of international concern about hydropower in the Balkans. At the same time, the Bern Convention Standing Committee, the Council of Europe’s environmental watchdog, decided to open a case-file and called on the Albanian government to halt the hydropower plant projects on the Vjosa River. Also, reacting to the repeating controversy over hydropower plants being built in Emerald protected sites, the Standing Committee recommended that the issue should be examined by a Group of Experts in order to develop principles for hydropower plants in Emerald sites.

This is a continuation of a growing trend. In June 2018, MEP Thomas Waitz (Greens/EFA) convened a screening of Blue Heart, a feature-length documentary produced by activist company Patagonia. In the following debate, European Commission representatives Nicholas Cendrowicz (DG NEAR) and Hans Stielstra (DG Environment) agreed that there are other ‘low hanging fruits’ aside from hydropower that should be considered in order to resolve the energy equation in the Balkans, such as energy efficiency and reducing losses in the grid. In support of this action, policymakers raised the issue of hydropower becoming increasingly uneconomic, saying that, compared with 20 to 30 years ago, today, they couldn’t see a strong business case for it.

Photo credit: Jason Alden, Patagonia, 2018

This is all the result of people in Europe and worldwide standing up to defend Balkan rivers. Following Bankwatch’s report that identified the main financiers of the Balkan dam tsunami, in June 2018, the Blue Heart of Europe campaign, Bankwatch and Patagonia handed over 120,000 signatures, asking European public banks to halt their support for destructive hydropower in the Balkans.

The wave of opposition to destructive hydropower cannot be easily tamed. Communities are becoming more and more vocal and persistent in defending their right to decide the fate of their rivers, as in the cases of Kruščica in Bosnia, Valbona in Albania or Stara Planina in Serbia.

The financial institutions are starting to listen. In its reaction to the 120,000-strong petition, the EBRD said that it has issued a new guidance note on the incorporation of minimum environmental and social policy requirements during hydropower project implementation. The Bank also agreed to organise a joint event in February 2019 with civil society and its own commercial bank partners to discuss the sustainability of financing hydropower. Meanwhile, the EIB also took CSO recommendations into consideration as part of its ongoing formulation of EIB Guidelines on Lending for Hydropower Projects.

Now it is time to capitalise on this new understanding and growing evidence that neither small nor large hydropower plants are a panacea for the climate crisis. Both the EBRD and EIB are currently revising their environmental and social policies. We expect that they will take resolute steps forward the most destructive projects from their portfolio.

Just last week the Blue Heart of Europe campaign provided a blue-print: an Eco-Masterplan for Balkan Rivers, encompassing no-go zones for new hydropower plants within a river network of over 80,000 kilometers in length, but also pointing out energy alternatives.

2019 is going to be a hot year for the future direction of hydropower development in the Balkans. Let’s hope it is the beginning of the end of a chaotic hydropower tsunami, and the end of the beginning of turning our attention to more sustainable alternatives such as demand response, wind and solar.

Eleventh hour for protected Kresna Gorge as Bulgaria presses on with destructive motorway

With construction advancing in Bulgaria’s Kresna gorge, discussion happening now at the Bern Convention in Strasbourg [1] having taken on an increased sense of urgency. The Convention’s Standing Committee is debating the possibility of requiring an independent review of the selected route of the Struma Motorway, an important step that would give a boost to years of campaigning by civil society and locals against the controversial routing of this section of the Pan-European transport corridor.

We call upon you to ensure that European laws for the protection of nature are respected and the pristine valley of Kresna Gorge in Bulgaria is saved from destruction.

The decision by the Bulgarian government to extend the southbound routing of the motorway through the Kresna gorge alongside the existing E79 route has been called a compromise to enable a speedier and more economic completion of the motorway.

Yet according to our analyses, the costs of construction of this ‘version’ will be the same – if not more – than if the motorway was constructed entirely outside the gorge. This is because our calculations include more than just the construction costs of the project, but also the economic opportunities resulting from lost livelihoods of local farmers whose lands in the area of Kresna will be appropriated and destroyed, and as well as costs to tourism like rafting, which is a key contributor to the economic activity of Kresna.

struma motorway cost estimates - kresna gorge

1. The calculation for the cost of route slected by government is based on official tender documents: http://www.aop.bg/ng/form.php?class=F02_2014&id=864986&mode=view
2. The calculation of the alternative route is based on JASPERS, Struma Motorway Lots 1, 2 and 4 Application Form – Supporting, Document Capital costs estimate 6417, Draft 9, November 2011

Furthermore, the construction of the last and most technically challenging section of the motorway – the area of the Kresna gorge – is now planned to be contracted to at least four different construction companies in the territory of NATURA 2000 site, which increases further the risks of negative impacts. Tenders are ongoing for two sections in the northbound direction of the motorway, passing east of the gorge, one for the rehabilitation of the current E79 road and one for a tunnel, all of which are happening at the same time.

The Bern Conevntion field visit to the Kresna gorge in 2002 was instrumental in shedding some light on the impacts of the Motorway construction on the gorge. The Convention’s recommendations for the Kresna gorge to be bypassed and the existing route to be used just for touristic purposes are still not implemented.

See what is happening in the gorge with this new video, and take action to help #SaveKresna.

Lessons learned from Germany’s 20-year experiment in energy transformation

First steps

As early as 2000, Germany introduced the Renewable energy act, which envisioned extra financial support to those who produced decentralised energy and fed it into the common network, thus receiving a special component of the tariff.

Energy intensive industries were exempted from this feed-in tariff, in order to not harm the economy. But every other electricity consumer paid a certain amount for the renewable electricity with this slightly elevated feed-in tariff. Currently consumers pay extra 6.79 euro cents for each consumed kWh (from 2019 – 6.405 cents/kWh).

The introduction of this support scheme for renewable energy resulted in, first of all, a rapid increase in the number of renewable energy producers and the proportion of renewables in the overall energy mix – from both bigger producers and prosumers. Second, the expanding renewable technology sector created new businesses and jobs.

As the costs of renewable technologies went down, the proportion of produced renewable energy went up, and energy got cheaper. Thus, around 2008 the feed-in tariffs were reduced: first, for solar installation, and a few years later – for wind and biomass cogeneration stations.

The Energiewende’s main achievement is that the proportion of renewable energy in the overall consumed electricity rose from 3.4 % in the 1990s to almost 40 % today. The rest of the electricity is mostly produced from coal and gas.

“It was carried out by people. Everybody could be part of the Energiewende by installing their own renewable energy sources. This really made up the success of the Energy transformation and brought acceptance that we are still relying on”, told Frank Peter, Deputy Executive Director of Agora Energiewende.

It was not a road without pitfalls. Energiewende has been heavily criticised for inducing a significant increase in electricity prices. Initially, no one forecasted such a rapid expansion of renewable energy production, which burdened electricity consumers during these years.

However, German environmental organisations and state institutions do not view this as a failure. It was unavoidable and necessary, and the investment will definitely pay off. The threats of uncontrolled climate change would be a lot more expensive in the long term.

And the public seems to be on board: Energiewende still enjoys public support. As many as 85-90 % of German citizens support transition towards cleaner energy.

Other support mechanisms and alternatives

Besides the feed-in tariff for renewable energy, other support measures include:

Auction mechanisms for larger projects, such as wind park construction;
Support for installing decentralised renewable energy sources;
Possibility to install renewable energy source in one’s property without initial investment by signing a long-term contract with a state agency that covers the initial investment, provides maintenance and gradually recoups their investment.

The feed-in tariff is not necessarily the best way to support renewables. The most fair and sustainable solution would be the introduction of CO₂ tax for all commodities and services, across all sectors. It would be an actual implementation of the ‘polluters pay’ principle, which would automatically make polluting activities financially disadvantageous. Currently, this matter is not on the national agenda in Germany, as it would require radical changes in the tax system as a whole. However, in the future Germany could follow the example of France and the Netherlands, which have introduced such principle in one way or another.

Going beyond green energy production

Despite the early successes of Energiewende, Germany’s greenhouse gas (GHG) emissions have increased, putting it below the GHG reduction target for 2020.

Partly, it is due to the economic growth, increasing population and intensifying transportation sector, which is reducing emissions too slow. But it is also due to insufficient energy efficiency promotion. The goal was to renovate and insulate at least 2 % of residential buildings each year, yet currently the figure is at 0.8 %.

There is no shortage of financial support. It is effective and available for individuals and companies; for multi-apartment residential buildings, private housing, and industries; for construction of new buildings, as well as renovating the existing ones.

However, current implementation of insulation projects is slowed down by the fact that half of all dwellings are being rented out, which hinders the insulation activities in these apartments and props up rent prices by approximately 11 %. At the same time, the savings on heating bills do not cover the increase of the rent price.

For Germany, it is crucial to continue phasing out coal, which requires not only developing renewable energy sources, but also addressing the issue of employment of whole regions. At present the government views natural gas as a bridge from coal and nuclear energy to renewables. Thus, the Nordstream 2 project will most likely be implemented despite its obvious flaws. Projects of this scale operate for at least 30 years, effectively eliminating the possibility of reaching the 2050 zero GHG emission target. If we wish to achieve the climate and energy targets, natural gas must be abandoned now.

As Germany makes its way forward, we can learn by observing. Energiewende gives away the wealth of knowledge accumulated over the past 20 years to create shortcuts for other countries that are just starting their energy transformation journeys.

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