Tuzla Thermal Power Plant
|This article is part of the CoalSwarm coverage of Bosnia-Herzegovina and coal.|
Tuzla Thermal Power Plant is a 715-megawatt (MW) coal-fired power station in Bosnia-Herzegovina. Two additional units have been proposed. The expansion is also known as Tuzla B.
The undated satellite photo below shows the power station near Tuzla.
The plant is owned and operated by Elektroprivreda BiH, a publicly owned power utility. Construction of the plant commenced in 1959. Commissioning of two 32 MW generating units took place in 1963 and 1964. Both of these units -- units 1 and 2 -- have since been decommissioned. In 1966 the 100 MW Unit 3 was commissioned. This unit was rebuilt and modernised in the late 1990s after the Bosnian War. Two 200 MW units -- Unit 4 and Unit 5 -- were commissioned in 1971 and 1974 respectively. The 215 megawatt Unit 6 was commissioned in 1978.
The power station currently consumer approximately 3.3 million tons of brown coal and lignite a year. Elektroprivreda BiH states on its website that coal for the plant is sourced from "Kreka (Dubrave, Šikulje, Mramor and Bukinje) and Banovići for Units 1-6, and brown coal from coal mines Đurđevik and Banovići for Unit 7."
Elektroprivreda BiH has proposed a seventh and eighth unit of 450 MW each. On its website Elektroprivreda BiH states that the power station has received an environmental permit, and construction is scheduled to begin in 2014 and end in 2018.
In May 2011 EPBIH stated that China National Electric Engineering CO., Ltd (CNEEC) had expressed interest in Unit 7, a 450 MW expansion. However, Reuters noted that the Swiss energy firm Alpiq had also bid to become a "strategic investor" in the plant.
In April 2014 Hitachi decided to pull out of the process to build the $1.16 billion Tuzla unit, citing political unrest in Bosnia. A Chinese consortium, which includes China Gezhouba Group and Guandong Electric Power Design, is the sole bidder to build the 450 MW unit.
According to a long-range plan released in May 2014 by Elecktroprivreda BiH, the new units will begin construction in 2015 and 2023 respectively and go online in 2019 and 2027 respectively. The plan stated unit 8 will be 450 MW.
On August 30, 2014, China Gezhouba Group Co. (CGGC) signed the EPC contract to build the 450MW unit 7. The company is applying for permits. It was later found the plant would not be economically feasible, and in May 2016 an annex to the contract was signed, which brought the cost down to EUR 722 million. in November 2016 a framework agreement on financing the plant through the China Exim Bank was signed, but the actual financing contract was not signed.
After Tuzla 7’s initial environmental permit expired in November 2015, a new one was issued in July 2016. NGO Ekotim filed a court case challenging the permit in September 2016. In October 2016 Ekotim also submitted a complaint to the Energy Community since the environmental permit does not require the application of the Industrial Emissions Directive to the plant, as required of new plants.
In November 2017, the Bosnia government indicated a loan contract for the proposed unit 7 from the Export and Import Bank of China (China Eximbank) could be signed soon, provided the State Aid Council also gives its consent for loan guarantees. The plant is expected to be built by China Gezhouba Group and Guangdong Electric Power Design.
On November 27, 2017, Bosnia secured a 613 million euro (US$732 million) loan from China’s Exim bank for construction of unit 7. With the loan, Elektroprivreda then hired three Chinese companies - Gezhouba Group and Guandong Electric Power Design Institute (both of China Energy Engineering Corporation) and Dongfang Electric - to construct the plant. IJ Global also reported that JP Elektroprivreda BiH would be committing US$134.92 million in equity toward the project.
The loan guarantee was cleared by the the State Aid Council of Bosnia and Herzegovina in July 2018, but in September 2018, the Energy Community Secretariat requested the Federal Parliament not to approve the guarantee, after concluding that the guarantee would not be in line with EU law, given that it contains elements of State aid, or subsidies, which are not allowed under the EU Energy Community Treaty.
In September 2018, it was reported that Gezhouba Group, Guandong Electric Power Design Institute, and Dongfang Electric of China were pulling out of the project, after failing to get approval for the plant from the Federation of Bosnia and Herzegovina.
On March 7, 2019, the Bosnia-Herzegovina Federal House of Representatives approved a loan guarantee for EUR 614 million from the China Exim Bank loan for the Tuzla 7 coal power plant. The House of Peoples has still to vote on the final stage of approval. According to the NGO Bankwatch, the loan approval is illegal:
- "Under the Energy Community Treaty, Bosnia-Herzegovina must follow EU rules on subsidies in the energy sector. Among other things, in most cases state guarantees may only cover maximum 80 percent of the total loan amount. The proposed guarantee for Tuzla 7, however, covers 100 percent of the loan, plus interest and other associated costs. There are circumstances in which this is allowed, but, as a September 2018 complaint to the Energy Community by the Aarhus Resource Centre and Bankwatch argued, the relevant conditions are not fulfilled in this case."
On March 26, 2019, the Energy Community Secretariat announced that it was officially opening a dispute settlement procedure on the planned Federal guarantee for a EUR 614 million loan from the China Eximbank to build the Tuzla 7 coal plant. The procedure can potentially lead to temporary suspension of financing by EU banks.
In November 2019, a consortium comprising Slovenia's NLB Banka, Italy's Intesa Sanpaolo, and Russia's Sberbank bid to provide €74 million to Elektroprivreda Bosne i Hercegovine (EPBIH) to part-finance the Tuzla 7 coal plant. The consortium was the only bid received for the project. It was subsequently confirmed to NGOs that this loan was agreed by the banks, coming just before Intesa Sanpaulo announced in April 2020 that it would no longer provide financing to new coal power projects. NGOs also raised concerns that NLB Banka shareholder the European Bank for Reconstruction and Development, despite having ended its own financing for coal projects under its Energy Sector Strategy of 2013, failed to prevent NLB's financing for Tuzla 7.
Local communities have been impacted by coal operations in Tuzla for more than 50 years, during which time they have seen their homes and lands become gradually encircled by huge lakes filled with coal ash and slag – the byproducts of burning coal. Their crops began drying up and their water has become undrinkable. There is extensive local opposition to the Tuzla 7 expansion, backed up by environmental organisations.
In December 2020, the Center for Ecology and Energy released a report revealing the extent of local land and water contamination from toxic substances such as cadmium, lead, nickel and chromium. In the first drinking water analysis to be carried out since the Tuzla complex began burning coal in the 1960s, from March to August 2020 the Center for Ecology and Energy conducted testing of water and soil samples near slag and ash disposal sites in Tuzla – Plane, Divkovići I, Divkovići II, Drežnik and Jezero I – as well as wastewater samples from the active ash disposal site Jezero II and samples from six water wells. In total, 23 water samples and two soil samples were analysed.
The results show that the wastewater at the active Jezero II ash landfill is alkaline toxic water containing quantities of cadmium, lead, nickel and chromium which exceed the prescribed limit values. This type of wastewater should not be discharged into surface water without treatment or come into contact with underground water. Out of the six water wells tested during the analysed period, water from only two of them could be considered completely safe to drink according to Bosnian national standards. The analysis also discovered that the soil on the closed waste disposal sites of Plane and Drežnik, which is currently used for agriculture, contains concentrations of nickel between 6 and 12 times above the prescribed limits, and concentrations of chromium and cadmium between 1.6 and 4 times higher. These heavy metals, even in small quantities, tend to bioaccumulate over time, eventually leading to chronic, degenerative changes on important body organs: the liver, bones, spleen and brain.
Project Details for expansion
- Sponsor: Elektroprivreda BiH
- Parent company:
- Developer: China Gezhouba Group, Guangdong Electric Power Design
- Location: Tuzla, Federation of Bosnia and Herzegovina
- Coordinates: 44.52, 18.606111 (exact)
- Status: Unit 7: Permitted; Unit 8: Announced
- Capacity: 900 MW (Units 7&8: 450 MW)
- Type: Supercritical
- Start date:
- Coal Type: Lignite
- Coal Source:
- Source of financing: Unit 7: US$882 million loan from the Export-Import Bank of China; €74 million (US$90.5 million) loan from NLB Banka, Intesa Sanpaolo and Sberbank; US$134.92 million in equity from JP Elektroprivreda BiH
Resources and articles
- "Thermal-power plant Tuzla", Elektroprivreda BiH website, accessed September 2012.
- "Unit 8 TPP 'Kakanj,'” Elektroprivreda BiH, accessed May 2014.
- Maja Zuvela, "China's CNEEC eyes Bosnia's $584 mln coal-fired unit", Reuters, May 30, 2011.
- "Hitachi exit means consortium sole bidder for $1.16bn coal plant," Power Engineering, Apr 23, 2014.
- "Dugoročni plan razvoja Elektroprivrede BiH do 2030. sa Strategijskim planom," Electroprivreda Bosne i Hercegovine, 29 May 2014, p. 142
- "CGGC signs EPC contract for thermal power project," CGGC, Sep 10, 2014
- "Tuzla 7 lignite power plant, Bosnia and Herzegovina," Bankwatch, accessed May 2017
- "Critical economic analysis of the Tuzla thermal power plant unit 7 project," Bankwatch, December 16, 2014
- Ioana Ciuta, "Race to the bottom: dire air quality worsens as BiH government mulls new coal plant at Tuzla," Bankwatch, Nov 22, 2017
- "UPDATE 1-Bosnia secures $732 mln energy loan from China's Exim bank," Reuters, Nov 27, 2017
- "Chinese Pull out From Building Bosnian Power Plant," Balkan Insight, Sep 19, 2018
- "Preview of Tuzla Thermal Power Plant Unit 7 (450MW) | Transaction | IJGlobal". ijglobal.com. Retrieved 2020-10-01.
- "Bosnia-Herzegovina Federal parliament guarantees Chinese coal plant loan in contempt of EU law," Bankwatch, March 8, 2019
- "Energy Community opens infringement procedure against Bosnia-Herzegovina over illegal Tuzla 7 state aid," Bankwatch, March 26, 2019
- "European banks must not support a "new Šoštanj 6" in Bosnia-Herzegovina, warn NGOs". Bankwatch. 2 December 2019. Retrieved 2020-01-13.
- [https://corpwatchers.eu/IMG/pdf/6_coal.pdf "How the BRI and the availability of Chinese finance weakens the rule of law in the Western Balkans,"] European Network of Corporate Observatories, December 2020
- "Pollution of land, surface and groundwater near the slag and ash disposal site of Tuzla thermal power plant," Center for Ecology and Energy, December 2020
- "China's Global Energy Finance," Boston University, accessed October 2018
Related SourceWatch Resources
- "Critical economic analysis of the Tuzla thermal power plant unit 7 project," Bankwatch, December 16, 2014