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Art installation at Berlaymont denounces banking on coal


Photos from the installation are below. More images (and higher resolutions) are available on the photographers Flickr profile.

Brussels – With an art installation that symbolizes EU citizens locked in a polluted environment, the Slovenian artist Marko Kumer Murč and Slovene environmentalists from Focus protest against European public and private banks pouring hundreds of millions of euros into a new lignite plant in their country, at Sostanj. Many Slovenians oppose this project and the Slovenian parliament has just refused to support a state guarantee for the banks’ loans. The action is supported by the international NGOs Banktrack and CEE Bankwatch Network, which are campaigning against the project.

The installation consists of a metal cube filled with smoke inside which several mannequins are trapped, with no way of escaping, representing an environment in which people are trapped in pollution. Outside of the cube, several volunteers dressed up in suits represent the bankers and politicians that support and invest in this project, thus keeping the people stuck in an unhealthy environment.

“We, the people who do not want this plant near our homes, who will inhale its fumes for decades, have tried in many ways to say we do not want it,” explains Murč. “No one really listens and this makes us angry. Finally, my art installation represents this anger and sadness crystallized. We must be heard.”

A new 600 MW lignite plant is planned to be built at Sostanj, in north-west Slovenia. The costs of the plant are estimated at 1.3 billion Euros, and 750 million Euros out of this amount are to be covered with loans from the European Investment Bank (the largest amount), the European Bank for Reconstruction and Development, and several private Western banks, including KA Finanz AG (Austria), Landesbank Hessen-Thuringen Girozentrale (Germany), Societe Generale (France), Caja de Ahorros y Monde de Piedad de Madrid (Spain), and Unicredit (Italy).

By 2050, together with all other EU members, Slovenia will have to reduce its overall CO2 emissions by at least 80 percent. The new block at Sostanj alone would take up almost all of the country’s emissions allowance if the required reduction is achieved. [1] In practice, this means that either Slovenia gives up the idea of building this plant or it will have to break its emissions reduction commitments as an EU member.

The Sostanj project is controversial not only for environmental reasons. Earlier this year, the Slovenian government issued a report in which it raised serious questions over the economic viability of this project. Additionally, the report brought allegations of corruption against the management at Sostanj. The Slovenian police are currently conducting an investigation into the corruption claims.

The Slovenian government failed to provide a state guarantee for the EIB loan before it had to step away in September, which motivated a group of parliamentarians to trigger a procedure for adopting a law on state guarantee for the EIB loan. This month, however, the Slovenian parliament refused to pass the proposed law on state guarantee for the EIB loan for this plant. This gave a clear signal that now is a time for the European public and private banks to reevaluate their involvement in a project that is marred by corruption, economic and environmental concerns.

“Many Slovenians oppose having a new lignite plant in our country and would prefer investments in energy efficiency and renewables,” says FOCUS’ Lidija Zivcic. “The European Union is committed to reducing its carbon emissions and some Western European countries are taking measures to limit fossil fuels use. It is deeply wrong that, while Western European countries are starting to clean up the mess in their own backyards, their private banks and EU-sponsored public banks try to make a profit out of building a new coal plant that would choke us Slovenians for decades. We want these banks to get out of this project and the time to pull out is now!”

For more information, contact:

Lidija Zivcic
Senior expert, FOCUS association for sustainable development
Tel: +386 15154080
lidija AT focus.si

Mel Denes
European Coal Finance Campaign Coordinator, Banktrack
Tel: +32 (0)488 697756
mel.denes AT netwerkvlaanderen.be

Notes for the editors:

1. Information about the new plant and how much environmental damage it would produce can be found at:
https://bankwatch.org/our-work/projects/sostanj-lignite-thermal-power-plant-unit-6-slovenia


Photos by: Pieter Delputte

Three new Czech incinerators to burn EU regional funds

Prague- CEE Bankwatch Network has learnt that the Czech Republic is planning to use 80% of regional funds dedicated to big waste projects for 2007-2013 [1] for the construction of new incinerators, which are three times more expensive than alternative waste management solutions.

The Czech Republic plans to build three new incinerators with EU regional funds available for big waste management projects in the current EU budget (2007-2013). According to information provided to CEE Bankwatch Network by the Czech State Environmental Fund, a mechanical-biological waste treatment plant (MBT, the more ecological alternative for waste disposal) would be three times cheaper per installed ton capacity to build than incinerators. This difference will eventually be passed on to the households in price for waste management.

180 million Euros of the incinerators’ cost are to be subsidized from EU regional funds, if the Czech application is accepted. By comparison, six new MBTs that the country plans to build as well, and which represent a much more ecological option, will require only 43 million Euros in EU subsidies. [2]

Incinerators are not only three times more expensive but they also produce toxic waste and they are significant sources of air pollution. Furthermore, because they burn waste without any previous sorting, they destroy valuable resources contained in waste. Mechanical-biological treatment plants, on the other hand, enable the recovery of materials contained within the mixed waste and facilitate the stabilisation of the biodegradable component of the material.

“Incinerators are extremely expensive facilities,” says Bankwatch waste campaigner Ivo Kropacek. “Support for such overpriced projects from taxpayer money is not clever. This is thrice true in the case of incinerators, which are three times more expensive than other methods of dealing with municipal waste.”

Bankwatch calls on the European Commission not to allow the Czech Republic to use EU money in such a counter-productive way, which additionally goes against EU waste legislation [3]. Cheaper and more sustainable solutions clearly exist and they must be promoted. [4]

Furthermore, considering that the new Cohesion Policy regulations published last month by the Commission do not exclude the use of EU regional funds for harmful projects in the next EU budget 2014-2020 [5], Bankwatch encourages the European Parliament and Council to amend the regulation texts so that incinerators are explicitly excluded from the types of projects that can be financed with EU money after 2014.

For more information, contact:

Ivo Kropacek
CEE Bankwatch Network waste campaigner
ivo.kropacek AT hnutiduha.cz
Tel: +420 604 207 302

Notes for the editors:

1. Member States are at the moment allowed to submit applications for major waste projects continuously, based on the so-called XVth call under operational programme environment (OP Environment), lasting
from January 4, 2010, until June 30, 2011. This call has been opened specifically for big waste projects such as incinerators or
mechanical-biological treatment plants.

2. A table of the projects can be downloaded at https://bankwatch.org/documents/incineratorsCZtable.pdf

3. The EU waste hierarchy, included by the European Commission in all its legislative proposals this year, from the Cohesion Policy regulations to the Resource Efficiency Roadmap published earlier this year, asks for prevention of waste production first and foremost, reuse and recycle as much as possible, and only if no other solutions are found, allows for the disposal of waste.

4. CEE Bankwatch Network encourages the application of the EU waste hierarchy. However, when no alternative to waste disposal exists, we argue that small MBTs are preferable to incinerators.

5. For a better understanding of the Cohesion Policy regulation texts, see: https://bankwatch.org/checklist-eu-cohesion-policy

Managers of EBRD-funded Kolubara mines in Serbia arrested for embezzlement

Belgrade -16 current and former members of the management of Serbian state-owned energy company Elektroprivreda Srbija (EPS) were arrested today and yesterday across the country over allegations of embezzlement of company funds. Some of these are people that the European Bank for Reconstruction and Development (EBRD) has entrusted this summer with managing an 80 million Euros loan for the development of the Kolubara lignite fields near Belgrade.

Among those arrested are: Dragan Tomic, EPS general director between 2004-2008 and currently an advisor in the Directorate for Strategy and Investments at EPS; Vladan Radovanovic, current deputy director of Kolubara mining complex and former director of Barosevac-Kolubara field; Zivojin Jovanovic, current director of all four mine fields at Kolubara; Milutin Bobic, current director of West Tamnava Field; Milan Petrovic, current director of Kolubara Field D. Tomic, who had apparently been informed about the possible arrest, was caught at the border with Macedonia, while trying to escape to Greece.

In August this year, the EBRD approved an 80 million Euros loan for “environmental improvements” at Kolubara lignite fields [1], in spite of receiving repeated warnings from NGOs CEE Bankwatch and CEKOR [2] that the management of EPS, which would oversee the developments, should not be entrusted with this money unless the police investigation – already begun at that time – clears them of all corruption allegations.

“Rather than wait for the results of the police investigation, the EBRD chose to rush into this loan rubbing its hands at the prospects of making profit from expanding lignite production in Serbia,” comments Zvezdan Kalmar, Bankwatch Serbian national coordinator. “Funnily enough, the Serbian media is writing that the amount syphoned off EPS in the past decade amounts to almost 130 million Euros. If this management that the EBRD chose to give money to had been honest, Serbia would not have needed to indebt itself to the EBRD in the first place!”

For more information, contact

Zvezdan Kalmar
Bankwatch Serbian national coordinator
zvezdan AT bankwatch.org
+381655523191

Notes for the editors:

1. Bankwatch and CEKOR argue that this money would in fact support the expansion of lignite power generation in Serbia to the tune of 700 MW.

2. See earlier Bankwatch press releases here or here.

Resource Efficiency Roadmap must come with money from EU Budget

Brussels – The Resource Efficiency Roadmap published today by the European Commission envisages all kinds of right recommendations for Europe to become a renewable based, resource efficient economy but the actual value of this document depends largely on the EU budget.

“We were pleased to see in this text so many positive signals from the Commission, all under the framework goal of moving towards an economy based on reuse and recycling, with residual waste close to zero,” says Marijan Galovic, waste campaigner at CEE Bankwatch Network. “This roadmap does set us in the right direction.”

“But what we are waiting to see now is whether the spending priorities for the next one trillion euro EU budget (2014-2020), to be announced in October, are really in line with the Resource Efficiency Roadmap,” Galovic added. “If the Commission actually puts money next to the goals set out in the Resource Efficiency Roadmap, then this will be a strong proof of political will for greening our economy. Otherwise, the goals in the Roadmap run the risk of not being implemented in useful time for meeting the Europe 2020 climate objectives and, fundamentally, for staying away from runaway climate change.”

According to Bankwatch, a fundamental weakness of the Roadmap is its overarching pro-market orientation, seen in the prominent role given to investment banks and innovative financial instruments in resource efficiency measures. One example is the core role envisaged by the Commission for public-private partnerships (PPPs) and to the European Investment Bank (EIB) in the financing of resource efficiency measures. The history of PPPs shows they are unlikely to be a useful instrument for ecosystem and natural resource conservation [1]. Previous Bankwatch research into PPP projects in central and eastern Europe [2] has shown these to be associated with high costs, low risk transfer to the private sector, difficulties in contract enforcement, and lack of transparency. Additionally, the NGO doubts the ability of the EIB, a bank specialized in large, mainly infrastructural projects of over 25 million euros, to be an appropriate promoter of ecosystem services.

For more information, contact:

Marijan Galovic
Waste campaigner, CEE Bankwatch Network
marijan AT zelena-akcija.hr
+38598849982

Anelia Stefanova
Campaign coordinator, CEE Bankwatch Network
anelias AT bankwatch.org
+ 393338092492

Notes for the editor:

1. Read more about the UK experience with PPPs: https://bankwatch.org/news-media/blog/times-crisis-polands-take-emperors-new-clothes

2.Read the Bankwatch study Nevermind the balance sheet. The dangers posed by public-private partnerships in central and castern Europe: https://bankwatch.org/documents/never_mind_the_balance_sheet.pdf

EU funds for transport used overwhelmingly for polluting roads in central and eastern Europe

Brussels – CEE Bankwatch Network publishes today a study showing that central and eastern European governments have been using EU funds overwhelmingly for road over rail development, ignoring EU calls for decarbonisation of the transport sector. The Commission can make sure that this pattern is not replicated with the next EU Budget (2013-2020) by introducing strict conditionalities in the new Cohesion Policy regulation next month.

“Transport is the only sector of the European economy where GHG emissions are increasing, and rapidly,” says Pavel Pribyl, Bankwatch transport coordinator. “EU member states have committed themselves to gradually decarbonising the sector. But the newest members do not seem to get it: ever since most of them joined the EU in 2007, they have used the bulk of funds available for them for the development of road and air transport, at the expense of the cleaner rail. The EU, holding the purse strings on the expenses, has to do more to prevent this attitude.”

The Bankwatch study [1] analyses how EU regional funds allocated for transport for the period 2007-2013 have been used in four member states: Bulgaria, Estonia, Poland and the Czech Republic. In all countries, expenditures for roads take up the majority of available EU funds for transport: 1.3 billion out of 2 billion Euros for transport have been allocated for roads in Bulgaria; in Poland, 10 out of 19.4 billion Euros go to roads. In both Poland and the Czech Republic, in spite of disproportionately large initial allocations for roads, national governments have additionally attempted to further reallocate rail moneys to roads.

In the Czech Republic and Bulgaria, insufficiently transparent tender procedures, faulty environmental impact assessments for various projects, and the marginalization of civil society in the process of deciding over allocations have also been documented, to the level that makes it plausible that “business and political interests have succeeded in privatizing the public interest,” as the Bankwatch report says.

“In January this year, the Commission called on member states to use regional funds more effectively to promote sustainable transport, even indicating concrete measures national authorities could take in this direction,” explains Pribyl. “But we doubt such a ‘soft’ call, coming past the half of the seven-year budget period, could make any difference. The Commission should act preemptively instead and introduce enough safeguards in the Cohesion Policy regulation to be published this October to make sure that it can punish bad spenders with immediate withdrawal of funds and reward good spenders instead. We fear only a strong stick and carrot approach from the EU can make a difference in our region.”

For more information, contact:

Pavel Pribyl
CEE Bankwatch Network transport coordinator
pavel.pribyl AT hnutiduha.cz
+420 603 207 249

Notes for the editors

1.
Bankwatch study “Transport cohesion on the right track?”:
https://bankwatch.org/sites/default/files/OP-transport-in-four-countries.pdf

European Commission communication “Regional Policy Contributing to Sustainable Growth in Europe 2020”: http://ec.europa.eu/regional_policy/sources/docoffic/official/communic/sustainable/comm2011_17_en.pdf

EBRD Board of Directors must face responsibility for long-term partner EPS’ wrongdoings


Belgrade – Today, over 70 protesters from the Vreoci community is gathering in front of the Belgrade EBRD offices to protest abusive practices by state-owned Elektroprivreda Srbija (EPS) (1), in London, the bank’s Board of Directors is congratulating itself for another profitable deal with the energy company. The EBRD cannot continue to brush off responsibility for corruption acts and human rights abuses committed by their long-term business partner.

On Tuesday, the EBRD is deciding whether to invest 80 million euros in the Kolubara „environmental improvement” project in Serbia (2). With this money, EPS will expand lignite production at Kolubara at the cost of forcefully resettling local communities. Hundreds of families in Vreoci oppose resettlement to the proposed location, which is threatened by landslides. Nevertheless, EPS has for more than two weeks started digging out the local cemetery under the protection of a massive police presence. The EBRD is satisfied that its money will be used on a coal field neighbouring the one where the violent resettlements are taking place.

This year, EPS is under investigation by both the police and the national anti-corruption body: allegedly, Kolubara management has been implicated in a number of different schemes involving equipment procurement and leasing and the sale of coal (3). Accusations of mismanagement surround also one of the four previous EPS-managed projects sponsored by the EBRD, dating back from 2003 (4). The EBRD again declares itself satisfied with the fact that EPS has responded correctly to the corruption accusations, by changing the management of Kolubara at both corporate and mine level.

„Instead of always being satisfied with damage-control by EPS, the EBRD Board would be better advised to withhold these precious tens of millions of euros from the coal-burning behemoth at least until the company proves itself to be an ethical business in front of Serbian authorities and public,” comments Zvezdan Kalmar, Bankwatch Serbian national coordinator. „Meanwhile, the EBRD could use the money to encourage renewables and energy efficiency projects by smaller Serbian companies, who so much need the market access.”

For more information, contact:

Zvezdan Kalmar
Bankwatch Serbian national coordinator
zvezdan AT bankwatch.org
+381655523191

Piotr Trzaskowski
Bankwatch energy coordinator
piotrt AT bankwatch.org
+48509162988

Notes for the editors:

1. Images from the protest can be found at http://bit.ly/qYI2WS ; a protest letter signed by 27 Serbian and international NGOs is available in pdf.

2. Project Summary Document: http://www.ebrd.com/english/pages/project/psd/2002/27005.shtml

3. National television channel B92 aired a series of documentary films exploring the nature and extent of the misuse of financial and other resources at the Kolubara complex and the financial and political repercussions. Links available via: https://bankwatch.org/sites/default/files/Briefing-KolubaraLignite-20Jun2011.pdf

4. http://www.ebrd.com/english/pages/project/psd/2002/27005.shtml