REPUBLIKA SRPSKA TO ADOPT NEW RENEWABLES INCENTIVE SCHEMES BY END-2019 / BOSNIA AND HERZEGOVINA / AUTHOR: VLADIMIR SPASIĆ / BGEN
Republika Srpska plans to introduce auctions for the construction of hydropower and solar power plants, as well as to continue using its power generation resources, including small and large hydropower plants and lignite-fired power plants. In an interview with Balkan Green Energy News, Petar Đokić, Minister of Energy and Mining of Republika Srpska, says that he is aware of the Energy Community Secretariat’s warnings and global intentions to curb fossil fuel power plants, but that he is convinced that the application of state-of-the-art technologies at coal power plants will ensure environmental protection standards are observed.
The Banja Luka District Court recently canceled the environmental permit for the construction of HPP Buk Bijela. Objections have been raised over the environmental impact assessment study. How do you comment?
It is of special significance for us that we have made the important decision to carry out the construction of hydropower plants on the Upper Drina together with Serbia. It had previously been planned for these projects to be carried out within Republika Srpska, by its power utility Elektroprivreda Republike Srpske (ERS). It is important to note that the preliminary design for HPPs Buk Bijela and Foča was produced in 2012 and later revised, and that certain corrections were made following the revision. Experts at Serbia’s power utility Elektroprivreda Srbije (EPS) are now reviewing the project, to be followed by determining the pace of implementation.
Elektroprivreda Srbije (EPS) is currently reviewing the project for HPPs Buk Bijela and Foča, to be followed by determining the pace of implementation
When it comes to approvals and permits for the construction of these hydropower plants, it should be noted that the environmental permit was issued in an earlier period and that the extension procedure, i.e. the issuance of a new environmental permit, will either be extended or a new request will have to be filed for a new environmental permit and the complete issuance procedure carried out. I do not expect any new problems and delays concerning this matter. I believe that all standards required when planning the construction of such energy facilities will be observed under the preliminary design and as such meet all environmental norms. I, therefore, see no reason why this matter should stall the project’s realization and the construction of these hydropower plants.
When could construction begin?
The project has practically been prepared. Of course, all relations that need to be regulated within the concession company need to be defined in detail. It should be noted that the Government of Republika Srpska had earlier awarded the concession for the construction of HPP Buk Bijela to ERS, however given that the governments of Republika Srpska and Serbia have decided to jointly work on these projects on the Upper Drina, the plan is for Serbia to have a 51% stake and Republika Srpska a 49% holding in the concession company for the construction of the power plants.
HPPs Buk Bijela and Foča will be built under the EPC plus financing model
Of course, many other important issues need to be defined, including the selection of a partner on the projects. It is planned for these projects to be implemented under the turnkey Engineering, Procurement and Construction (EPC) plus financing model. Over the past two years, discussions were held in Republika Srpska with a number of companies that expressed interest in the construction of these HPPs. These companies continue to express readiness to participate in the process to select the company to carry out the project under the model I mentioned. We hope that this phase too, once we reach it in the fall of this year, will be successfully completed and that we will select the company capable of carrying out the works as well as offering financing for the project.
I believe that it will be particularly important for Republika Srpska and the project as a whole that our partner be a company that can offer the most favorable terms for the realization and construction of these HPPs, i.e. offer us complete financing, provide guarantees it can carry out the works, the most favorable deadline terms, and, of course, provide guarantees of the quality of executed works. Given the discussions we have had, we expect that these power plants can be built within four years at the most, possibly a shorter period, counting from the day the contractor can start construction.