Banovici lignite power plant, Bosnia and Herzegovina
The 350 MW Banovići coal power plant project is being developed alongside the existing Banovići mine just a few kilometres away from Tuzla by the predominantly state-owned RMU Banovići (Banovići Brown Coal Mines).
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The 350 MW Banovići coal power plant project is being developed alongside the existing Banovići mine just a few kilometres away from Tuzla by the predominantly state-owned RMU Banovići (Banovići Brown Coal Mines). In 2015, a construction contract was signed with China’s Dongfang, the same company which built the Stanari plant. As of early 2022 it seems unlikely that the plant will go ahead, but it has not been officially cancelled.
The project’s economics have been kept under wraps and no feasibility study is publicly available. Banovići’s Director stated in a July 2016 interview that the generation cost would be EUR 50/MWh. However, former EPBIH Director Amer Jerlagić cast doubt on this figure and stated that neither the Banovići nor the Tuzla 7 plants appear feasible given the low prices on the European electricity wholesale market.
Financing has not been confirmed but is being sought from the Industrial and Commercial Bank of China (ICBC). The project is supposed to cost EUR 405 million. It also appears that a guarantee by the Federation of BiH government would be required, raising questions about compliance with State aid rules under the Energy Community Treaty.
'Hostages of coal'
An AlJazeera report on the situation of people affected by the coal infrastructure in Tuzla and Banovici.
Local language only.
The environmental permit for the Banovići power plant was renewed in early 2016, but failed to cover numerous issues and prescribe precise mitigation measures. NGO Ekotim therefore filed a court case seeking to annul the permit in April 2016. The court case was rejected in late 2019 on the spurious grounds that a Sarajevo-based NGO cannot complain about a project sited near Tuzla – a verdict now being appealed at the Federal Supreme Court, as well as being subject to a complaint to the Aarhus Convention.
Likewise, no transboundary consultation was carried out for the plant’s environmental assessment, even though this is required under the Espoo Convention. After a complaint was made to the Convention’s Implementation Committee, Bosnia and Herzegovina pledged to carry out transboundary consultations for any renewal of the plant’s environmental permit.
Scarce water resources
In order to obtain water for the Banovići plant, the small existing Ramići lake would be expanded into a larger reservoir. However it is not clear that the runoff from the surrounding hills could provide enough water. Another issue is the structural soundness of the earth dam which is planned to hold back the water at Ramići.
Initial proposals included using water from the Turija river to fill the reservoir during dry periods, however this would then deprive Modrac, and thus the Tuzla power plant and the people of Tuzla, of a significant source of water. More recent proposals have focused on taking water from Lake Breštica which is located in the Spreča river basin, but this would have the same result. The issue remains unsolved. For this reason Ekotim filed a court complaint against the environmental permit for the reservoir in April 2016, which was also rejected in late 2019 and is being appealed to the Federal Supreme Court.
In September 2019 it was reported that RMU Banovići had failed to obtain a water consent for the Ramići reservoir from the Tuzla cantonal authorities, as it had tried to extend the validity of a previous one which had already expired.
Construction permit refused
The project has received on-and-off high level support from the Federal authorities in Bosnia-Herzegovina. However in December 2017, it was announced that the project had been refused a preliminary construction permit due to unresolved issues around water consumption, coal supply, flue gases, ash disposal and other issues. In January 2021 the project’s environmental permit expired and as of early January 2022 no new one has been issued.