Europe’s most polluted country is beset by energy poverty, yet rich in toxic lignite. Is there a viable alternative to coal?
by Harriet Salem
At the end of a dirt road, in the central Kosovan municipality of Obilić, lies Plemetina, a labyrinth of hastily constructed houses. Home to about 2,500 people, it is nestled below Kosovo B, a 600-megawatt, lignite-fuelled thermal power plant that belches black toxic fumes day and night.
“I have woken up and cursed that power plant a million times,” says Driton Berisa, a Roma civil rights activist, sipping an espresso. “The air is always thick with smoke and dust, no matter how fresh the morning is.”
He is sitting in a cafe in Prishtina, the capital of Kosovo – Europe’s most polluted country (pdf) – but even here, in a city choked with car fumes, the air is much cleaner than in his village.
Like many in Plemetina, Berisa and his family arrived as refugees during the war. His mother, 55, has just undergone surgery for cancer, an illness he believes is the result of living less than half a kilometre from the power plant. “Everybody I know here has someone in the family with cancer,” he explains. “It’s one of the reasons I want to get out. I don’t want my children growing up breathing this air.”
It has not been easy to find a balance between Kosovo’s urgent need for energy security and the poisonous effects of lignite, its cheapest naturally available resource. The country sits on the world’s fifth-largest reserve of lignite, which produces 97% of its energy. Worth an estimated $1tn, at current consumption levels the supply will last another 1,500 years. Yet Kosovo faces frequent power cuts and exceptionally high levels of energy poverty.
“Kosovo has difficult and complicated energy needs,” says Jan-Peter Olters, World Bank’s Kosovo manager. “Three things have to be done at the same time: secure a supply of energy that it still does not have; ensure energy is affordable for people and enterprises operating here; and minimise the social and environmental impacts as much as possible.”
The Bank is providing technical support to help the government develop and implement its energy strategy. At the core of the plan are two projects: one is to rehabilitate technology at Kosovo B to meet European Union environmental standards; the other is to replace the outdated Yugoslav-era Kosovo A power plant – which generates 2.5 tons of dust hourly – with a 600-megawatt facility, Kosovo C. If this plan goes ahead, the new unit will be built next to Kosovo B – further increasing pollution in the vicinity of Obilić.
These projects are progressing slowly but surely. Tender bids for private investment are scheduled for completion in April 2014, after which the World Bank – which has begun an environmental and social impact assessment – will determine the extent of its future financial involvement. The likeliest outcome is that it will at least act as a partial financial guarantor.
This year the bank imposed stringent conditions on coal investments. But as an International Development Association country – financially and energy poor – Kosovo meets the exceptional circumstances clause that permits lignite lending, according to the Bank.
That claim has triggered outrage among environmental lobbyists, who see Kosovo as a litmus test of the bank’s commitment to withdraw from coal borrowing. “Kosovo has high losses in its energy grid, around 30-40%,” says Visar Azemi, co-ordinator of the Kosovo Civil Society Consortium for Sustainable Development (Kosid). “We should not be talking about increasing capacity before efficiency.”
Azemi believes investment in Kosovo C will do little to reduce energy poverty. “Building this kind of facility is expensive and the companies will need to recoup their investment; ultimately, these costs are passed on to the end consumer,” he says. “It will lock Kosovo into a future of dependency [on] lignite. World Bank should explore other alternatives first.”
Kosid cites research produced by the University of Berkley that shows potential for Kosovo to incorporate a significantly larger proportion of renewables into its energy mix than the existing 2%. The World Bank, however, says its experts are unable to find an economically viable solution that does not require substantial further investment in coal.
“For better or worse, Kosovo sits on 14bn tons of lignite, its comparative advantage in renewables is not really evident,” says Olters. “We would like to be position to say an energy mix is doable, but that is not the case. If this [investment] doesn’t happen, then the default option is that Kosovo A will remain open.”
Scott Morris, policy fellow at the Centre for Global Development, says the evidence is inconclusive. He belives it would be wrong for the Bank to rule out coal lending. “There have to be options available to poor countries to meet their development needs,” says Morris. “The bank should not be looking to have a large coal agenda. But it should be noted that Kosovo B is the only coal project they have in the pipeline.”
The importance of energy security is not lost on the residents of Plemetina, who experience regular power shortages. Locals, however, say more open dialogue is needed. “I am not against the power plant,” Berisa says. “But I have never heard of any representative from the Kosovo government or World Bank visiting Plemetina to discuss these issues.”
Asked about the potential need for resettlements, Olters said a plan for the mine was being worked on by the Kosovo government with World Bank support, but that those living near the Kosovo B power plant do not need to be relocated.
The difficulties of overseeing resettlements in developing countries are well known. The European Bank for Development and Reconstruction is reeling from a series of corruption scandals surrounding the rehousing of residents near Kolubara mines in neighbouring Serbia.
“In the end,” Berisa says, “it seems we pay the highest price for coal, with our health and our lives, but we get nothing in return.”