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Created on: 2019-11-19 11:05:41
Last update: 2022-03-15 00:00:00 BankTrack & CAN Europe
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|Sector||Coal Electric Power Generation|
About Çayırhan-B coal power plant
The Çayırhan-B coal power plant is a planned 800MW extension to the existing 620MW Çayırhan coal power plant. Like the existing plant, it would be fueled by the Çayırhan II lignite mine. It is expected to cost USD 1.1 billion.
As of October 2021, however, the construction of the power plant has been cancelled due to insufficient invester follow through.
Why this profile?
The planned extension of the Çayırhan coal power plant will have adverse impacts on both people and the planet. The power plant will emit more than 4 million tonnes of CO2 into the air, worsening climate change and negatively impacting public health.
What must happen
The Paris Climate Agreement goals require a managed decline of fossil fuel production. The construction of new coal power plants is not compatible with this goal. Banks must immediately stop financing new coal power plant developments anywhere in the world. As such, banks should steer clear of financing this project.
Social and human rights impacts
Effects on farm land According to the EIA report, the Çayırhan B coal plant will be constructed on 740 hectares of land, of which 65% is productive farming land. Since the plant area has no overground water supply available, it will have to use 40 tonnes of underground water per day. Use of this water resource is expected to have devastating effects on farming.
Environmental and climate impacts
Climate and air pollution impacts Electricity demand in Turkey is rapidly increasing, and the power industry is the largest source of greenhouse gas emissions. The Çayırhan-B coal power plant is expected to produce 4 million tonnes of CO2 each year, increasing the negative effects on the environment and climate change. The plant will produce 1 million tonnes of ash per year, and because of the winds in the area, this ash will be spread over a wide area. The Çayırhan plant, which has been in existence since 1978, has a track record of polluting the water and soil with heavy metals.
Local bird sanctuary under threat The Çayırhan coal power plant is only 5.9 kilometres away from a bird sanctuary at Davutoğlan in the Nallıhan district. This sanctuary has more than 200 bird species, and is located in a bird migratory route. This area falls under the Ramsar Agreement, an international treaty on the protection of wetlands. The sanctuary is protected under two different statuses: one is 'natural preserve', given in 1994, and the second is 'wildlife cultivation area', given in 2005.
Cumulative health effects For decades, coal power plants in Turkey have fuelled climate change and polluted the air. This has created an unacceptable health burden, leading to people dying early and causing and worsening of diseases such as asthma, chronic bronchitis or heart disease.
Applicable norms and standards
$100 million collateral returned to Kaylon-Kolin
The Kaylon-Kolin partnership, who oversaw the project development of the Çayirhan-B Coal Power Plant, could not honour their commitment and the guarantee of 100 million dollars for the project was returned.
After Çelikler Holding - an energy conglomerate - withdrawed from the project, further negotiations with Chinese investors did not yield any results. Thus, no progress has been made over several years and the construction phase of the coal power plant could not be reached.
Electricity Market Regulatory Authority cancels license of Cayirhan B project
The Turkish Electricity Market Regulatory Authority (EMRA) has cancelled the license of Cayirhan B project. It was the first project to be privatised under a new law aimed at offering developers off-the-shelf sites, a strategy that places responsibility for securing permits and vital checks and balances, such as environmental impact assessments, land expropriation, and building permissions in the hands of state-owned company EÜAŞ, before offering them up to tender at private auctions (Europe Beyond Coal).
Garanti BBVA may become involved in financing the Çayırhan-B coal power plant as it listed the project as an investment opportunity in its January 2017 Outlook.
As of 26 March 2021, however, the bank reaffirmed its commitment against climate change and accounced to stop financing coal-related activities by 2040.
Following the July 2019 withdrawal of Çelikler Holding from the project, Kolin and Kalyon Group are the remaining project developers.
Garanti BBVA and IIF discuss the post-COP26 sustainable agenda
Kalyon-Kolin'e 100 milyon dolar teminatı iade edildi
Çevrecilerin karşı çıktığı proje için 'acele kamulaştırma' kararı
CHP'den Çayırhan-B Termik Santrali İçin Araştırma İstemi
In March 2016 EÜAŞ (Electricity Generation I.C.) announced a tender for a second coal power plant in Çayırhan. In June 2016, EÜAŞ applied for the EIA with a combined EIA report for a 800MW coal power plant, a coal mine, a laundry facility, a lime-quarry pit and a shattering and sieving facility.
In 2017 the Turkish government started a privatisation program under which the Çayırhan power plant and mine were put up for tender. A consortium consisting of Kolin, Kalyon Energy and Çelikler Holding won the tender in February 2017 at the price of USD 60.4 per Megawatt Hour.
In April 2019 a presidential decree was issued to expedite the extraction of coal from the Çayırhan II lignite mine for use in the project. In July 2019, Çelikler Holding withdrew from the project and the Chinese company Harbin Electric signed an agreement with Kolin and Kanyon for the plant's construction.