EBRD in Serbia: Don't use floods to prop up coal

July 7, 2014

The EBRD should stick to its newly approved Energy Strategy and reject any investments in the Serbian coal sector, argue a group of 7 international NGOs [*] in a letter sent to the bank’s board of directors today. The groups were concerned with recent statements by the EBRD according to which the bank’s regional flood response in the Balkans could include “rehabilitation of (…) damaged power stations and transmission and distribution networks.”

Read the letter sent by NGOs to the EBRD here:

The tragic floods hitting Serbia in May had a serious impact on the country’s highly centralised energy system: the Kolubara mines, the biggest in Serbia and feeding power plants which produce about half the electricity used in the country, were all inundated. The country’s coal production was roughly halved soon after the floods, with the government being forced to resort to imports.

“The energy crisis that looms large today in Serbia has its roots in the faulty structuring of the energy system,” writes the NGO letter. “The highly centralized power sector is excessively reliant on electricity production by coal-burning plants that were built before 1990 and are supplied with lignite from local mines.” According to the document, debates in Serbia around a new energy strategy for the country to be valid 2015-2025 make it clear that the government plans to continue giving a central role to coal.

„It is possible that the government of Serbia, like others in the region, may have requested for EBRD financial help with reopening mines or rehabilitating coal plants,” says Bankwatch’s EBRD coordinator Findaka Bacheva-McGrath. „Yet the EBRD should have learnt by now that the perpetual crisis of the energy sector in Serbia is caused by overreliance on coal and hyper-centralisation which can no longer be justified with post-war and post-flood excuses.”

„If the EBRD really wants to help Serbia, it cannot keep contributing to keeping us prisoners of coal,” says Zvezdan Kalmar of Serbian NGO CEKOR. „Instead, the EBRD could give more support for energy efficiency measures in housing, where the potential for savings is huge, and invest in alternatives to fossil fuels. 20 to 30 percent of our energy needs could be met from biomass in no more than five years if proper investments were made.”

In their letter, the NGOs draw particular attention to communities living in the vicinity of the coal mines at Kolubara. In the village of Vreoci for instance, near the Kolubara Field D where mining has been intensified to make up for other mines not being used, people who have been asking for years to be relocated because they live too close to the mines are more worried than ever. Not only has potentially toxic mining waste has been brought by the floods in their villages but they also fear the impacts of intensified mining on their crumbling houses.

„The EBRD always claims that Serbian state company EPS is in charge of resettlements of people, but for so many years they have not bothered with the rights of people living close to the mines,” says Kalmar. „If the EBRD want to provide Serbia with humanitarian assistance, the best way to start is to create a fund for facilitating the resettlement of communities impacted by the Kolubara mines.”

Read the letter sent by NGOs to the EBRD here:

* CEE Bankwatch Network, CEKOR Serbia, Center for Environment Bosnia and Herzegovina, SEE ChangeNet, Sierra Club US, Both Ends Netherlands, 350.org