Banovici power station

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Banovici power station is a shelved power station in Banovici, FBIH, Bosnia and Herzegovina.

Location

Table 1: Project-level location details

Plant name Location Coordinates (WGS 84)
Banovici power station Banovici, FBIH, Bosnia and Herzegovina 44.4, 18.5333 (approximate)

The map below shows the approximate location of the power station.

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Project Details

Table 2: Unit-level details

Unit name Status Fuel(s) Capacity (MW) Technology Start year Retired year
Unit 1 shelved coal - lignite 350 supercritical

Table 3: Unit-level ownership and operator details

Unit name Owner
Unit 1 RMU Banovici dd [100.0%]

Project-level coal details

  • Coal source(s): Banovici coal mine

Background

In 2013, the project reportedly had permits and approvals for construction and was planned for completion in 2018. The total estimated investment value was 584 million euros. It would include development of the Banovici coal mine. RMU Banovici was seeking a strategic partner.[1]

According to Bankwatch, the Bosnian Federal Minister of Environment and Tourism issued an environmental permit in 2012 for the power station which included no limits for air pollution emissions.[2]

In May 2014, Banovici selected 11 qualified bidders out of 13 companies to finance and build the new power plant. By February 2015 RMU Banovici selected four companies for the final round. Three of the bidders were Chinese companies Shanghai Electric Group Co., China Gezhouba Group and Dongfang Electric Corp., while the fourth one was a consortium led by Spain's Abengoa SA, which included China's Harbin Electric. The best offer would be chosen by the end of 2015. The power plant was expected to be connected to the grid in 2020.[3][4]

In October 2015, Bosnia said it had chosen China's Dongfang Electric Corp to finance and build the 350 MW coal plant. Construction was expected to begin in mid-2016.[5] Financing agreements for the project were also signed between Dongfang and the Industrial and Commercial Bank of China (ICBC).[6] Later reports stated that Chinese banks led by the Industrial and Commercial Bank of China (ICBC) had agreed to provide loans for 85% of the project financing (approximately US$ 363 million), while the remainder would come from a consortium of Bosnian banks led by the local unit of Italy's UniCredit.[7]

In February 2017, the EU Energy Community ruled that Banovici would be considered a new plant under the Industrial Emissions Directive (IED) Chapter III, and therefore had to comply with the stricter emission limit values for plants that enter operation after January 1, 2019, requiring amendments to the permit for the plant issued by the Ministry that did not specify this requirement. The decision came in response to a July 2016 complaint filed by the environmental NGO Ekotim.[8][9]

Permits denied

In December 2017 the Federal Ministry for Spatial Planning in Bosnia-Herzegovina denied Banovići a construction permit for the 350 MW lignite plant, saying key issues such as water supply, coal supply, wastewater, flue gases and ash disposal had not been resolved. A lawsuit challenging the plant's environmental permit from the Federal Ministry of Environment and Tourism, issued in January 2016, was ongoing.[10]

On May 21, 2019, it was reported that the Government of the Federation of Bosnia and Herzegovina (FBiH) had tasked the state-owned power utility EPBiH "to accelerate all activities related to the projects for the construction of new units at existing coal-fired thermal power plants Tuzla (unit 7) and Kakanj (unit 8), as well as the project for the construction of TPP Banovici near the coalmine of the same name."[11]

In September 2019, RMU Banovici was denied a water permit for the coal plant, on the grounds that the application did not meet the required conditions for a planned water reservoir.[12]

In March 2021, the UN Human Rights Council Special Rapporteur on the implications for (1) human rights of the environmentally sound management and disposal of hazardous substances and wastes and (2) human rights obligations relating to the enjoyment of a safe, clean, healthy and sustainable environment wrote a letter investigating the proposed power station.[13]

In April 2021, a federal letter stated: "RMU Banovici does not currently have an environmental permit for the project of the Thermal Power Plant Banovici with a capacity of 350 MW, because the expiration date has expired. The investor did not submit a new request for environmental impact assessment. Therefore, the Federal Ministry of Environment and Tourism implies that the project for the construction of TPP Banovici, as if it did not even exist."[14]

In April 2023, Bosnia and Herzegovina announced a draft national energy plan until 2030 that foresees no new coal-fired plants.[15]

Potential Just Transition plans

According to a January 2022 "Just Transition" blog, a recent series of happenings are forcing the town to turn on its heels and face a new, sustainable development model. Among these are the fact that most financiers – including Chinese banks – now see coal as a liability and refuse to finance new coal plants; the commitment to decarbonisation by 2050 of all Western Balkan countries, and the very concrete expiry of the proposed plant’s environmental permit and the developer’s lack of action in requesting a renewal. In 2021, under new leadership, the town joined the Clean Air Regions Initiative, led by the Energy Community Secretariat and also applied for the exchange programme within the Coal Regions in Transition Initiative for the Western Balkans. "The former commits the participating municipalities to develop, adopt and maintain Local Air Quality Action Plans with ambitious local air quality targets, policies and measures; while the latter aims to pair the town with another coal-dependent town either in the EU or in the USA and provide study visits, knowledge exchange, and expert support. 2022 starts with even more promising news in support of Banovići’s transition journey – it could become the host of Tuzla canton’s first solar farm."[16]

In November 2022, the national energy utility Elektroprivreda BiH was seeking bids for the development of a 8.36 MW solar park.[17]

2023 Status

The Bankwatch report stated that 'as of early 2023, it seemed highly 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. Financing was sought from the Industrial and Commercial Bank of China (ICBC), but was never signed. The project was 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.[18]

Another source from early 2023 referred to the project as a phantom one where nothing happened.[19]

The project's status was revised to Shelved in May 2023. There was no further news on the project as of January 2024.

Financing

Proposed in 2016: Dongfang Electric Corp[5] and Industrial and Commercial Bank of China (ICBC).[6] Later reports stated that Chinese banks led by the Industrial and Commercial Bank of China (ICBC) had agreed to provide loans for 85% of the project financing (approximately US$ 363 million), while the remainder would come from a consortium of Bosnian banks led by the local unit of Italy's UniCredit.[7]

Articles and Resources

References

  1. "Preparation of Construction of Thermal Power Plant Banovići," Sarajevo Times, December 1, 2013
  2. "Western Balkans: 'cheap' lignite plants built now will cost heavily later," Bankwatch, updated April 2014
  3. "Four bidders left in race to build 350 MW coal-fired plant in Bosnia," Reuters, February 20, 2015
  4. "New Coal Plant to be constructed in Banovici?," Sarajevo Times, February 22, 2015
  5. 5.0 5.1 "China's Dongfang to build 350 MW power plant in Bosnia," Reuters Africa, Oct 22, 2015
  6. 6.0 6.1 "Bosnia: Chinese Dongfang continues its European energy market development," ESIASEE, July 8, 2016
  7. 7.0 7.1 "Croatia's IGH to supervise construction of Bosnia's Banovici TPP under 7.15 mln euro deal," SeeNews, September 4, 2019
  8. "Campaigners claim legal win against Bosnian coal power push," Climate Home, February 16, 2017
  9. "New blow to Bosnia-Herzegovina coal plans as Energy Community requires changes to permit," esiasee, February 21, 2017
  10. "Construction permit denied for Banovići coal power plant in Bosnia and Herzegovina," Bankwatch, December 15, 2017
  11. "Bosnia and Herzegovina: FBiH Government to accelerate TPP Tuzla, Banovici projects," SEE Energy News, May 2019
  12. "Druga strana medalje: RMU nije ispunio uslove za Termoelektranu u Banovićima," klix, September 26, 2019
  13. "AL BIH 2/2021," UN Human Rights Council Special Rapporteur, March 17, 2021
  14. "EIA /IC /INFO /23, Banovici Thermal Power Plant, information," Federal Ministry of Environment and Tourism, April 22, 2021
  15. "BiH's NECP: coal power plants to be shut, 2 GW of renewables installed". balkangreenenergynews.com. April 28, 2023.{{cite web}}: CS1 maint: url-status (link)
  16. "Are the winds of change heralding a just transition for Bosnia and Herzegovina?," Just Transition, January 14, 2022
  17. "Bosnia's Elektroprivreda BiH seeks bids for construction of 8.36 MW solar park," SeeNews, November 14, 2022
  18. "Banovici lignite power plant, Bosnia and Herzegovina". /bankwatch.org. 2023.{{cite web}}: CS1 maint: url-status (link)
  19. "Phantom thermal power plant in Banovići". https://www.etrafika.net/. February 2023. {{cite web}}: External link in |website= (help)CS1 maint: url-status (link)

Additional data

To access additional data, including an interactive map of coal-fired power stations, a downloadable dataset, and summary data, please visit the Global Coal Plant Tracker on the Global Energy Monitor website.