A series of at least five new lignite power plants planned in Western Balkan countries which aspire to European Union membership risk violating Energy Community pollution legislation before they even start generating electricity, warns a new legal briefing by EU-based legal organisation Frank Bold, published today.
As a result of commitments made under the Energy Community Treaty in October 2013, new power plants in the Western Balkans, Moldova and Ukraine will have to comply with the latest EU pollution control legislation – Chapter III of the Industrial Emissions Directive – by 2018.
Due to the fact that it takes around four years to construct a power plant, any plants that have not started construction yet will enter operation only after 2018, and need to have the appropriate pollution control technology built into the planning and permitting process in order to avoid unexpected extra costs to retrofit the plants later.
The Frank Bold expert analysis shows, however, that at least five plants across the Western Balkans — notably in Bosnia and Herzegovina, Serbia and Montenegro – may not be in line with the relevant parts of the EU Industrial Emissions Directive if constructed as planned today.
“What this means in practice is that there is a high risk of unforeseen additional costs to the investors in these plants as well as consumers of electricity, as developers may have to scramble to make last minute technological adaptations to ensure compliance with the IED as we get closer to 2018,” commented Kristina Sabova of Frank Bold.
“What governments in the region need to understand is that there is no option of going around the IED requirements for new plants after 2018, and that failure to plan ahead now may cost heavily later.”
The most stark example of non-compliance with the IED is EFT’s Stanari lignite power plant in Bosnia and Herzegovina – currently under construction – whose environmental permit allows it to emit 2-3 times more SO2, NOx and dust than even the currently binding legislation adopted by the Energy Community (the IED implies a tightening of current standards).
This led to an official complaint being submitted to the Energy Community Secretariat by Banja-Luka-based Center for Environment in January this year. The complaint is currently under examination.
Pippa Gallop of CEE Bankwatch Network commented:“Despite the clear European trend of moving away from coal, Balkan governments still have big plans in this sector. If these projects go ahead, compliance with the Industrial Emissions Directive is now the legal minimum condition that needs to be adhered to for anyone still considering coal investments.”
“Balkan authorities had better be advised that the IED is not the end of the story: countries wanting to join the EU can expect further environmental and climate legislation changes which will almost certainly affect their coal investment,” adds Gallop. “In this region too, governments and investors need to understand that building new coal plants is no longer a good investment option, considering the climate and health costs and the high failure rate of such projects.”