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European Parliament wants green energy, not coal, as part of Kosovo integration


The European Parliament yesterday blasted the European Bank for Reconstruction and Development (EBRD) for considering financing of the planned USD 2 billion Kosova e Re lignite power plant near Pristina.[1]

In an amendment to the report on Kosovo’s European integration process [2], the Parliament chastised the bank for prioritising the 600 MW lignite plant over energy efficiency measures and renewable energy projects. The amendment comes in advance of the EBRD approving on 1 May its first country strategy for Kosovo as the newest member of the bank. The Parliament is instead urging the European Commission to take action and contest the EBRD’s strategy because of its contradiction with EU climate targets.

“This resolution sends a strong reminder to the EBRD that it is bound by EU legislation and must not finance these kinds of environmental time bombs,” said Ionut Apostol, Bankwatch EBRD energy campaigner. “The Kosova e Re is more expensive than the alternatives and would lock Kosovo into high levels of lignite power production for decades, crowding out more sustainable energy sources and jeopardising Kosovo’s ability to meet EU requirements on energy and climate.”

Agron Demi from the Kosovo Civil Society Consortium for Sustainable Development said: “The EBRD is off to a terrible start in Kosovo. The business as usual approach to coal in the country strategy is unacceptable, because coal already costs Kosovo hundreds of millions of euros every year in health related costs, causing premature deaths and children to suffer from respiratory diseases.”

Kosovo and international civil society organisations have expressed disappointment that the most concrete feature of the strategy is support for Kosova e Re lignite plant, which is set to replace the existing Kosovo A plant. Plans to support much-needed energy efficiency and savings measures and renewable energy in Kosovo [3] are ill-defined in the country strategy.

For more information contact:

Ionut Apostol
CEE Bankwatch Network energy campaigner
Mobile: +40721 251 207
Email: ionut at bankwatch.org

Agron Demi
Kosovo Civil Society Consortium for Sustainable Development
Mobile: +377 44 417 634
Email: agron at institutigap.org

Notes for editors:

[1] More information about Kosovo’s energy sector and the EBRD Kosovo strategy is available at:
https://bankwatch.org/news-media/blog/ebrd-disastrous-start-kosovo-european-parliament-not-amused

[2] The full text of the amendment reads:

61. Calls on Kosovo to work on developing renewable energy and diversifying energy sources with a view to closing down Kosova A and rehabilitating Kosova B in accordance with its obligations under the Energy Community Treaty; underlines the necessity of devoting more of the financial aid provided by the EU and the EBRD to energy saving, energy efficiency and renewable energy projects; regrets that the EBRD is planning to support new lignite capacity (Kosova e Re) in its draft country strategy, and calls on the Commission to take action to contest plans such as this that run counter to EU climate commitments.

The final version of the approved text will be available at:
http://www.europarl.europa.eu/sides/getDoc.do?type=MOTION&reference=B7-2013-0089&format=XML&language=EN

A provisional version is at:
http://www.europarl.europa.eu/sides/getDoc.do?pubRef=-%2f%2fEP%2f%2fTEXT%2bTA%2b20130418%2bTOC%2bDOC%2bXML%2bV0%2f%2fEN

[3] Daniel Kammen, Professor at the University of California in Berkeley and former World Bank ‘Clean Energy Czar’, has shown 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.

http://coolclimate.berkeley.edu/sites/all/files/Kosovo20May2012.pdf

New report: Funding sustainable development in European regions – recommendations for the programming of EU funds in 10 CEE Countries

Today, CEE Bankwatch Network is launching a compilation of position papers which describe in detail how environmental NGOs across Central and Eastern Europe see the contribution of the next EU Budget (post 2014) to overcoming Europe’s high energy and material consumption and to protecting our nature.

The position papers offer detailed recommendations on how 10 countries across Central and Eastern Europe could spend EU funds in areas such as transport, energy and waste management. The countries covered by the Bankwatch study are: Poland, Hungary, the Czech Republic, Slovakia, Bulgaria, Latvia, Estonia, Macedonia, Albania, and Croatia.

The entire compilation can be downloaded on the Bankwatch site.

The compilation is published at a time when governments of member states are coming up with national strategies for the use of the future EU Budget (the so-called “national programming” process). Even though at EU level there is a wide consensus on the need to decarbonise the European economy, use natural resources more sparingly and focus on environmental measures, national priorities often end up being different.

Our position papers indicate possible areas of concern in the national programming stage (i.e., areas where each of the governments has been known to mis-allocate funds in the past and appears likely to do that in the next budgeting period). Furthermore, we are showing that there is an alternative to the mantra of ‘development achieved via heavy infrastructure investments primarily’.

We have calculated how EU funds can be used to increase energy efficiency of all buildings and thus put an end to energy waste. We are proposing a clear prioritisation of public transport and pedestrian and biking infrastructure in order to reduce pollution and noise from roads and airports and make our cities more liveable. In some of the countries, we even propose alternative sets of indicators to measure well-being and the impact of human life on the environment, in order to inspire our governments to focus on research for new green technologies.

Our compilation strongly makes the point that it is possible to use the next EU Budget in order to transition towards resilience in Central and Eastern Europe. Citizens in our countries want to see such developments. And our national authorities have a unique opportunity to use this programming period to listen to their citizens’ voices and make wise use of valuable EU resources.

New CEE Bankwatch Network Study: “No Time to Waste: Cohesion Funds programming for a resource-efficient Europe”

Find the study here >>

The EU Resource Efficiency Flagship Initiative, the strategic framework setting out how the waste sector should look like in Europe by 2020, envisages that by the end of this decade waste in Europe will be managed as a resource we have to care for, hence landfilling has to be eliminated, incineration limited to non recyclable materials, and recycling turned into a truly economically viable option.

The new budget of the European Union, that will cover a period of seven years after 2014, especially through its regional funds component, can and should provide the main financial means for transforming the European waste sector along the lines expounded by the Resource Efficiency Flagship Initiative.

Considering the configuration of the next EU Budget emerging from the current negotiations, regional funds can be used for this goal, as long as member states of the EU are able to plan the use of this money in an intelligent way when it comes to waste management.

In order to assist national governments and regional authorities to conduct such planning in the upcoming period (member states are at the moment setting out to construct the operational programmes according to which they will spend EU funds over the next seven years), CEE Bankwatch Network has today published a set of guidelines for waste spending in the OPs. The study illustrates examples of good practices and gives advice to decision-makers over what programming pitfalls may appear and should be avoided.

“The European Union budget will provide significant resources for the member states for the next seven years and these resources must be used to implement European objectives, such as those from the Resource Efficiency Flagship Initiative, especially those that promote sustainability in Europe,” comments CEE Bankwatch’s Marijan Galovic, one of the authors of the study. “Producing less waste, and reusing and recycling the waste we produce is one of the main means through which we can turn into a more resilient society; we are still in time to make this crucial transformation in our treatment of waste.”

Find the study here >>

Never again Sostanj, NGOs warn European public banks after Slovenia debacle

After the EIB and the EBRD disbursed a promised 650 million euros for Slovenian lignite plant TES 6 on March 8, Focus Slovenia, CEE Bankwatch Network, and 96 other NGOs are today sending a letter to the two banks calling on them to never commit to such a misguided loan again.

“In the last two years, we have seen the EIB and the EBRD, which had committed to covering approximately half the costs of the unit, become increasingly embarrassed by this project, but at the same time seemingly not managing to find a legal way to extricate themselves out of it,” comments Lidija Zivcic from Focus in Slovenia. “With this letter, we want to impress upon the banks that there are steps that they can and must take today in order to avoid financing more of such controversial projects in the future.”

The signatories of the letter note the main reasons why Sostanj was undeserving of public loans from the EIB and the EBRD:

  • Slovenia will now have to choose between failing to reduce its emissions by 80-95 percent by 2050 and closing Sostanj 6 before the intended date;
  • No alternatives to a lignite or coal unit were seriously examined. Having invested so much public money in a new lignite plant, the development of energy efficiency and renewables in the country will be crowded out;
  • Health impacts from the project were not taken into consideration and it was left to civil society to find out that Unit 6 would annually (from 2016 on) cause between 33 and 48 deaths and create between EUR 168 million and EUR 242 million in damage to the national economy;
  • Corruption allegations about the project were public knowledge when the EIB approved the second tranche of its loan and the EBRD approved its loan in 2010. Even now OLAF, the European Anti-Fraud Office, has not yet concluded its investigation into the case, which still threatens to cause further problems for the project;
  • When the project originally went to the EIB for financing consideration, most people in Slovenia did not even know it existed. This failure to ensure adequate public consultation seriously back-fired later when the project became highly controversial to an extent that threatened its continuation.

The 98 organisations signing the letter to the EIB and EBRD presidents are recommending a set of measures that need to be taken by the banks immediately in order to avoid such mistakes from being repeated in the future:

  • Ensure that the new Energy Policies of the two banks (both of them being updated this year) finance energy efficiency and sustainable renewable energy rather than fossil fuels, especially coal, in order to contribute to global greenhouse gas reductions of 50-70% by 2050 and the EU’s decarbonisation agenda;
  • Examine more carefully project alternatives instead of accepting project sponsors’ claims that none of them are viable;
  • Ensure that wide public participation on large and potentially high-impact projects takes place at a stage when all options are open, and includes all relevant stakeholders. Most importantly, the banks need to seriously listen to the concerns raised;
  • Write into financing contracts a clause stating that funds will not be disbursed in case of ongoing national or European level fraud or corruption investigations.

“The EBRD is preparing to finance other coal projects across Central and Eastern Europe, the most notorious being the new lignite plant Kosovo C close to Prishtina, in which the EBRD has expressed an interest recently,” comments Pippa Gallop from CEE Bankwatch Network. “Kosovo C looks strikingly similar to Sostanj 6 in that it would prevent Kosovo from making a transition towards a more energy-efficient and renewables-based economy and the EBRD must wake up to realise this before it turns itself into the bankroller of disastrous energy projects across the Balkans.”

Read the NGO letter here:
https://bankwatch.org/publications/open-letter-eib-ebrd-sostanj-must-never-happen-again

Read more on the energy lending of both banks here:
https://bankwatch.org/campaign/energy-lending

EBRD finances lifetime expansion of Ukrainian nukes, but gets defensive about it

Kiev – The European Bank for Reconstruction and Development approved yesterday a 300 million euros loan for the so-called “Safety Upgrade Programme” of Ukraine. In reality, the beneficiary company, state-owned Energoatom, will use the money to prolong the lifetime of 12 old nuclear reactors.

“We consider this loan to be one of the biggest mistakes committed by the EBRD lately,” comments Ionut Apostol, Bankwatch EBRD coordinator. “Despite the bank denying that this money will be used for lifetime expansion, just very recently the technical director of Energoatom stated publicly that, without the safety upgrade programme, one should forget about lifetime extension of the old nukes.”

“This is an extreme case of ‘Newspeak’ from the EBRD,” adds Apostol. “They call it safety upgrade, when in fact it means more years of unsafe nuclear power, with no money going to decommissioning of expired reactors and spent fuel treatment, which should be core to any nuclear safety package.”

“It is outrageous that the EBRD is helping Ukraine run their old nuclear power plants longer under the disguise of safety upgrades and it is equally outrageous that a country like Germany, a member of the EBRD decision-making board which is implementing a nuclear phase out at home, did not strongly oppose this decision,” comments Regine Richter from German green NGO urgewald.

Together with a European Commission loan under the Euratom Treaty (which is expected to be approved in the following months), the EBRD is covering up to 40 percent of the project costs, which have been estimated at 1.45 billion euros according to the most recent calculations.

Particularly worrisome is that the Safety Upgrade Programme to be funded by the EBRD does not guarantee the safe operation of Ukrainian nuclear units after the expiration of the original design lifetime. The 12 reactors whose lifetime will be expanded should all be taken out of operation by 2020 at the latest, but they will function at least a decade more instead. For example, the South Ukrainian Reactor 1, which had been stopped already, will be restarted again using financing approved by the EBRD today.

“In the main ecological assessment report prepared for the Safety Upgrade Programme, only impacts within the design lifetime were analysed,” explains Iryna Holovko, Bankwatch coordinator for Ukraine. “To take the specific case of the South Ukrainian Unit 1 that expires this year, its potential environmental impacts beyond the closure date have been deemed by Energoatom to be ‘non-significant’ because ‘in previous years of operation no significant impacts were observed’. This is a highly irresponsible approach to nuclear safety and one that the EBRD, if it is a responsible public lender, should not be buying into.”

The EC is expected to approve a parallel loan to Ukraine under the Euratom loan facility in the next few months. The conditionalities for both loans remain unknown to date, but if the EC and the EBRD are serious about nuclear safety, then the preparation of decommissioning plans for the reactors should be part of any loan to the Ukrainian nuclear sector.

In an unprecedented move caused by the strong opposition generated by this investment plan in Ukraine and Europe-wide, the EBRD has posted on its website a Q&A with the main points raised by opponents of this loan to which it responds. The Q&A and an accompanying promo video produced especially for the occasion of the announcement of the loan is available here: http://www.ebrd.com/pages/news/features/ukraine-nuclear-safety-upgrade.shtml.

Notes for the editors:

Read more details about the risks of this Safety Upgrade Programme in a recent Bankwatch Mail article:
https://bankwatch.org/bwmail/55/new-nuclear-risks-ukraine-ebrd-urged-not-back-lifetime-extensions-under-guise-safety

and see the basic facts of this case on the Bankwatch website:
https://bankwatch.org/our-work/projects/nuclear-power-plant-safety-upgrades-ukraine

Photos from a Greenpeace + Bankwatch action in Kiev against the prolongation of nukes’ lifetime are available here:
https://bankwatch.org/news-media/blog/public-action-ukraine-reminding-ebrd-meaning-nuclear-safety (Can be reprinted with due credit)

See EBRD Safety Upgrade Programme project page:
http://www.ebrd.com/pages/project/psd/2011/42086.shtml

For more information, contact:

Iryna Holovko,
CEE Bankwatch Network, National campaigner for Ukraine
iryna at bankwatch.org
mob: +38050 647 67 00

Regine Richter
urgewald Berlin
mob: 0170-2930725
regine at urgewald.de

Europe’s public banks disburse EUR 650 million to Sostanj coal plant despite ongoing corruption charges

Ljubljana – The European Investment Bank announced today [1] that it would pay the remaining EUR 440 million out of a EUR 550 million loan [2] for the construction of a new 600 megawatt lignite unit at Sostanj [3] in Slovenia, and that the European Bank for Reconstruction and Development would follow suite with its parallel EUR 100 million loan.

The news comes in spite of assurances from EIB President Werner Hoyer during a press conference last week in Brussels that corruption allegations would be scrutinised before any further payments to the project are made. Despite Hoyer’s commitments, the money will be paid before the European Anti-Fraud Office (OLAF) [4] has completed its investigation into allegations of corruption about the awarding of the constructing contract for the new plant to Alstom, the French infrastructure conglomerate. Additionally, the public has yet to be informed about the outcomes of similar internal investigations at the EIB and EBRD [5].

“This is all really bad news for Slovenia,” comments Barbara Kvac from Slovenian NGO Focus. “This plant alone will take up almost all of the allowed emissions for our country if we align to the EU 2050 climate goals. It is ironic that the bank of the European Union is lending Slovenia money that will make reaching EU objectives more difficult, and it is sad that in Slovenia we cannot count on coherent, positive cues from our country for Brussels.”

“Since the EIB approved its loan in 2007 and the EBRD followed in 2010, Sostanj has become a huge scandal that has followed the banks. Despite the damaging climate impact, the embarrassing corruption scandal and the questionable economic viability of the project, the EIB and EBRD signed the deal with the Slovenians and couldn’t see itself pulling out,” said CEE Bankwatch Network’s Pippa Gallop. “But the EIB and EBRD are the first institutions that should be courageous enough to pull out if a deal is deficient: they are public banks, meant to uphold European goals. Last time I checked, pollution, corruption and dubious economics were not EU objectives.”

Coincidentally the disbursement follows the release of a new report by the Health and Environment Alliance “The unpaid health bill – how coal power plants make us sick,” which provides the first-ever calculations of the effects of coal-fired power generation on chronic lung disease and some heart conditions.

“The findings of the report come as no surprise, since Greenpeace issued a report with similar findings already in June 2012. HEAL’s report confirms the worst. The TES 6 project will lock Slovenia into a fossil-fuel intensive future for the next 40 years, and this could eat up around 9 billion euros of taxpayers money in the form of health costs associated with air pollution from coal power plants. If we add the possible risks that this project brings with its bad economics and vulneribility, this number could be even much higher,” said Nina Štros, head of Greenpeace CEE in Slovenia. „It is outrageous that the EIB would rather protects its own interests and the interests of the investor rather than working towards what it was established for: creating a better and safer future for all Europe’s people.”

Notes for the editors:

1. http://www.eib.org/infocentre/press/news/all/eib-and-ebrd-to-support-completion-of-tes-thermal-power-plant-sostanj-project.htm

2. 110 million euros have already allegedly been paid out by the EIB in 2011 according to media reports. http://www.eib.org/projects/pipeline/2006/20060319.htm

3. https://bankwatch.org/our-work/projects/sostanj-lignite-thermal-power-plant-unit-6-slovenia

4. https://bankwatch.org/publications/olaf-decision-investigate-corruption-tes-6

5. https://bankwatch.org/sites/default/files/StateCommissionReport-corruption-TES6-23Feb2012.pdf

For more information contact:

Lidija Zivcic,
Focus Slovenia
Email: lidija at focus.si
Mobile: +386 41 291091

Nina Stros, Head of Greenpeace CEE in Slovenia
Email: nina.stros at greenpeace.si
Mobile +386 40 871 530