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Home › Dodgy Deals ›
Dodgy Deal
Tuzla 7 coal power plantBosnia and Herzegovina

Project – On record

This profile is no longer actively maintained, with the information now possibly out of date
Profile by:
BankTrack
Contact:

Pippa Gallop, CEE BankWatch
Research coordinator
Tel: +385 99 755 97 87

Last update: 2020-04-14 14:57:07
Tuzla Thermal Power Plant. Photo: Steffen Emrich via Creative Commons (CC BY-ND 2.0)

Project – On record

This profile is no longer actively maintained, with the information now possibly out of date
Profile by:
BankTrack
Contact:

Pippa Gallop, CEE BankWatch
Research coordinator
Tel: +385 99 755 97 87

Last update: 2020-04-14 14:57:07
Why this profile?

Why this profile?

The planned Tuzla 7 lignite-fired power plant in Bosnia and Herzegovina would provide additional coal capacity to the already existing units in Tuzla, with adverse consequences for climate change, air pollution and human health for decades to come.

What must happen

China Exim Bank should withdraw from financing this project. No other financial institution should get involved in this dodgy deal. Banks should publicly commit to end support for new coal power stations, and produce a robust plan for phasing out support for fossil fuel projects and companies.

About
Sectors Coal Electric Power Generation
Location
Status
Planning
Design
Agreement
Construction
Operation
Closure
Decommission
Website https://www.epbih.ba/eng/page/unit-7-tpp-tuzla

Tuzla 7 is a new unit planned at the Tuzla Thermal Power Plant in Bosnia and Herzegovina. The plant is owned by Elektroprivreda Bosne i Hercegovine (Public Enterprise Electric Utility of Bosnia and Herzegovina, or Elektroprivreda BiH), a majority state-owned company.

Tuzla 7 is a 450 MW power plant that would produce 2756 GWh per year if in operation. The project backer claims the plant will replace existing units at the Tuzla Thermal Power Plant. However, the company plans to close only the existing 100 MW unit 3 before 2027 while units 4, 5 and 6 would continue to operate. As such the establishment of Tuzla 7 would create additional coal capacity.

China Gezhouba Group is the company that will construct Tuzla 7 when agreement about the project's financing is achieved. The project secured a loan of USD 732 million from the China Exim Bank, which will cover the biggest part of the project. The loan has been guaranteed by the Bosnian government, but still awaits approval from Parliament.

Impacts

Social and human rights impacts

Human health WHO reports that the power plants in Tuzla have caused the loss of 4,900 years of life, 131,000 working days and 170 hospitalizations for cardiac and respiratory diseases until 2013. Expanding the power plant with another unit - causing an increase in the plant's coal capacity - will worsen these impacts.

Misleading job promises The Federation of Bosnia-Herzegovina guaranteed to preserve 3,500 jobs in the mines through constructing Tuzla 7. However, as reported by CEE Bankwatch, the number of workers has not been at this level for years. The BiH mines are the least labour efficient in the region, and hardly any are economically feasible. For these reasons, the Federation of Bosnia-Herzegovina will not be able to maintain the current number of jobs.


Environmental and climate impacts

Climate change Lignite-fired plants generate an enormous amount of CO2 emissions and thereby directly contribute to climate change. The emissions of Tuzla 7 are calculated to be at least 2,308,000 tonnes of CO2 per year. Expansion of the fossil fuel industry is not compatible with reaching the goals of the Paris Agreement.

Pollution Tuzla 7 is not designed in line with EU pollution standards. Tuzla 7 is not in line with the 2017 LCP BREF standards (Best Available Techniques Reference Document for Large Combustion Plants), which are obligatory in the EU for new plants. This means that even before the construction of Tuzla 7 has begun, the unit can already be said to be outdated.

New ash landfill site The planned construction of the Šićki Brod ash landfill facility was not included in the environmental permit that was acquired for the project. Ash dumps will contaminate water and soil, and can also be a hazard for local communities. The people living around the proposed landfill site are heavily against the plan.

Financiers

The construction of the Tuzla 7 coal power plant will be financed through debt. In 2017, China Exim Bank provided the project with a loan of EUR 614 million, which covers 85% of the construction costs. In December, 2019, a banking consortium led by Slovenia's NLB Banka, including Intesa Sanpaolo and Sberbank, offered to provide a loan financing the remaining 15%.

Institution type
Finance type
Year
Companies

China Gezhouba Group

China
Website

Elektroprivreda Bosne i Hercegovine

Bosnia and Herzegovina
Website

Guangdong Electric Power Design Institute

China
Website
No companies
Governance
Norms & standards

Applicable norms and standards

Energy Community Treaty
News
BankTrack
Partners
Blog
External
BankTrack news BankTrack blog Partner news Partner blog

Bosnia’s planned Tuzla 7 lignite plant on the rocks after state aid U-turn

2022-07-06 | CEE Bankwatch Network, Aarhus Centre in Bosnia and Herzegovina, Just Finance International
Blog
BankTrack news BankTrack blog Partner news Partner blog

Intesa Sanpaolo adopts a disappointing new policy on coal and unconventional oil & gas

Last Tuesday, Italia's largest bank released its updated policy on fossil fuel financing, Greenpeace Italy and ReCommon react with disappointment
2021-07-28 | Rome | Greenpeace Italy, ReCommon
BankTrack news BankTrack blog Partner news Partner blog

Premature Adult Mortality and Years of Life Lost Attributed to Long-Term Exposure to Ambient Particulate Matter Pollution and Potential for Mitigating Adverse Health Effects in Tuzla and Lukavac, Bosnia and Herzegovina

2020-10-26 | Health & Environment Alliance (HEAL)
BankTrack news BankTrack blog Partner news Partner blog

Bosnia, la società civile insorge contro la centrale a carbone targata Intesa

(article in Italian)
2020-04-02 | Valori.it
BankTrack news BankTrack blog Partner news Partner blog

Energy Community Treaty violations dig Western Balkan countries deeper into coal hole

2020-01-20 | CEE Bankwatch Network
BankTrack news BankTrack blog Partner news Partner blog

New China-backed coal plants on EU’s borders could saddle states with massive carbon costs

2020-01-14 | Unearthed
BankTrack news BankTrack blog Partner news Partner blog

European banks must not support a “new Šoštanj 6” in Bosnia-Herzegovina, warn NGOs

2019-12-02 | Bankwatch
BankTrack news BankTrack blog Partner news Partner blog

NGOs reaction to preparatory works kicking off at Tuzla 7 coal unit in Bosnia-Herzegovina: “This plant is not ready for construction”

2019-10-31 | CEE Bankwatch network
BankTrack news BankTrack blog Partner news Partner blog

Šljakom će se puniti praznine u rudniku?

(text in Bosnian)
2019-10-08 | Oslobodenje
BankTrack news BankTrack blog Partner news Partner blog

Belt and Road summit puts spotlight on Chinese coal funding

2019-04-25 | The Guardian
BankTrack news BankTrack blog Partner news Partner blog

Secretariat questions compliance of state guarantee for the Tuzla 7 project with the State aid acquis

2019-03-26 | Energy Community
BankTrack news BankTrack blog Partner news Partner blog

Bosnian energy project ‘surprises’ EU enlargement chief

2019-03-13 | Euractiv.com
BankTrack news BankTrack blog Partner news Partner blog

Chinese investors affirm support for Bosnia's Tuzla TPP project

2018-10-24 | SeeNews
BankTrack news BankTrack blog Partner news Partner blog

EU energy watchdog urges Bosnian lawmakers not to back Chinese energy loan

2018-09-27 | Sarajevo | Reuters
BankTrack news BankTrack blog Partner news Partner blog

Bosnia to guarantee $700 mln Chinese loan to power utility EPBiH

2018-08-17 | Sarajevo | Reuters
BankTrack news BankTrack blog Partner news Partner blog

Bosnia secures $732 mln energy loan from China's Exim bank

2017-11-27 | Sarajevo | Reuters
Resources
Documents
Links
2020-12-18 00:00:00

Pollution of land, surface and groundwater near the slag and ash disposal site of Tuzla thermal power plant

NGO document
2020-12-18 00:00:00 | CEE Bankwatch Network and Europe Beyond Coal
2019-10-24 00:00:00

Report of the Implementation Committee on its forty-fifth session

Meeting of the Parties to the Convention on Environmental Impact Assessment in a Transboundary Context
Other document
2019-10-24 00:00:00 | Economic and Social Council - Espoo Convention
2017-11-30 00:00:00

Best Available Techniques Reference Document for Large Combustion Plants

Other document
2017-11-30 00:00:00 | European IPCC Bureau
2015-11-01 00:00:00

Draft National Emission Reduction Plan for Bosnia and Herzegovina

Other document
2015-11-01 00:00:00 | United States Agency for International Development
2017-06-14 00:00:00

Planned coal power plants in the Western Balkans versus EU pollution standards

NGO document
2017-06-14 00:00:00 | CEE Bankwatch Network
2013-11-01 00:00:00

Health Impacts of Coal Fired Power Generation in Tuzla

NGO document
2013-11-01 00:00:00 | Centar za ekologiju i energiju
2016-06-10 00:00:00

Europe's Dark Cloud

How Coal-Burning Countries Are Making Their Neighbours Sick
NGO document
2016-06-10 00:00:00 | Sandbag, Health and Environment Alliance, Greenpeace, Climate Action Network, WWF European Policy Office

Sourcewatch profile of Tuzla coal power plant

Bankwatch profile Tuzla 7 coal power plant

Updates

2019

2019-12-02 00:00:00 | Banking consortium offers a loan for the construction of the Tuzla 7 coal power plant

CEE Bankwatch Network has reported that a banking consortium had been the only bidder to provide a EUR 74 million loan to Elektroprivreda Bosne i Hercegovine (EPBIH) to part-finance the Tuzla 7 coal plant. The consortium, led by Slovenia's NLB Banka, also includes Intesa Sanpaolo (Italy) and Sberbank (Russia). The EUR 74 million loan would cover 15% of the costs for the construction of the coal plant. The other 85% is to be provided by the China Exim Bank (Read Bankwatch Network's press release here).

2019-10-31 00:00:00 | NGOs reaction to preparatory works at Tuzla 7 coal power plant: “This plant is not ready for construction”

Preparatory works for the construction of a new 450 MW coal unit Tuzla 7 are set to start, even as numerous controversies accompany the project, including an infringement case under the Energy Community Treaty. “Tuzla 7 would sentence Bosnia and Herzegovina and its neighbours to several more decades of pollution and greenhouse gas emissions. This project reminds me of a Hans Christian Andersen’s story, The Emperor’s New Clothes. It’s high time that we finally acknowledge that the emperor is naked,”  Denis Žisko of the Centre for Ecology and Energy from Tuzla said. “Europe is moving away from coal – Montenegro just recently announced it was dropping a new coal unit at Pljevlja. This is not only because of coal’s climate and health impacts but because it no longer makes economic sense.” (CEE Bankwatch network).

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