Bosnia and Herzegovina breaches Energy Community Treaty commitments, says official NGO complaint

Banja Luka – Bosnia and Herzegovina is failing on its Energy Community obligations by allowing Stanari lignite plant to pollute 2-3 times more than EU standards, shows an official complaint (1) submitted today by NGOs Center for Environment from Banja Luka and ClientEarth to the Vienna-based Energy Community Treaty secretariat.

The Energy Community serves as a bridge between the EU and aspiring countries, assisting the latter with implementing EU legislation related to energy and the environment and merging domestic markets with the European energy market.

According to the NGO complaint, pollution levels allowed for EFT’s 300 MW Stanari lignite power plant in Republika Srpska in its environmental permit are 2-3 times more than allowed by the EU’s Large Combustion Plants Directive (2001/80/EC) (2). Energy Community countries such as Bosnia and Herzegovina are bound to implement this Directive.

“This is not the first time that Bosnia is failing to meet its obligations under the Energy Community Treaty,” says Bankwatch’s Pippa Gallop. “At the end of last year, the Energy Community Ministerial Council said that Bosnia and Herzegovina was failing to implement required EU legislation in the gas sector (3). Such violations can have serious consequences for Bosnia and Herzegovina’s participation in the Energy Community.”

In today’s complaint, Center for Environment also argues that Bosnia and Herzegovina has breached its obligations relating to the environmental assessment of projects, since the changes in the project made since the Environmental Permit was issued are so large that they require a new Environmental Impact Assessment – and that never happened. Construction of the 300 MW Stanari power plant by Chinese contractor Dongfang started this year but the project has been under development for many years, and has undergone a capacity reduction from 410 MW to 300 MW and a change of technology (4) which results in an increase of SO2 emissions and significantly lower thermal efficiency.

“Bosnian authorities cannot afford to continue failing in implementation of EU Directives,” says Igor Kalaba of the Center for Environment. “Not only do we risk sanctions now, but, as pollution standards will be further tightened in the Energy Community in 2018, non-compliance even with today’s standards may mean that plants such as Stanari will be illegal by the time they even start to operate!” (5)

“Our authorities may think they can get away with such breaches, but this is wrong,” adds Kalaba. “They should be sure that both the EU and the NGO sector are keeping a close eye on projects such as Stanari and Ugljevik III (6). A Bosnia and Herzegovina fuelled by dirty coal and infringing the Energy Community Treaty cannot realistically aspire to join an EU that is by the day moving closer to decarbonisation.”

Contacts:

Igor Kalaba, Center for Environment, Banja Luka
igor.kalaba at czzs.org
Tel.: +387 65860796

Malgorzata Smolak, ClientEarth, Poland
msmolak at clientearth.org
Tel. +48 22 307 01 84

Pippa Gallop, CEE Bankwatch Network
pippa.gallop at bankwatch.org
Tel.: +385 99 755 9787

Notes for editors:

(1) The complaint is online at:
https://bankwatch.org/sites/default/files/complaint-ECS-Stanari-16Jan2014.pdf

(2) The Large Combustion Plants Directive (2001/80/EC) places limits on pollution from various installations including thermal power plants.

(3) For more information about the November 2013 Energy Community decision about Bosnia and Herzegovina’s failure to implement legislation in the gas sector see:
http://www.energy-community.org/portal/page/portal/ENC_HOME/AREAS_OF_WORK/Dispute_Settlement/2011/8_11

(4) After the first Stanari Environmental Permit was issued in 2008, the project was changed from 410 MWe to 300 MWe and from pulverised coal with supercritical steam parameters to subcritical steam parameters in a circulating fluidised boiler.

(5) The Industrial Emissions Directive (2010/75/EU) – will be binding for Bosnia and Herzegovina from 2018, including for the Stanari power plant.

(6) The 600 MW lignite power plant Ugljevik III, promoted by Russian billionaire Rashid Sardarov’s Comsar Energy and constructed by the China Power Engineering and Consulting Group Corporation (CPECC) is planned to be built near the site of the existing Ugljevik plant in the north-east of the Republika Srpska entity of Bosnia and Herzegovina. The plant has raised concerns as existing air pollution in the area is high, and it seems unlikely that the new plant will comply with the pollution limits stipulated in the EU Industrial Emissions Directive. Its net efficiency level is expected to be very low at only 34.1%.