Kosovo C Power Station

Kosovo C Power Station is a proposed 400 to 600 MW coal-fired station planned for Kosovo by Kosovo Energy Corporation (KEK), the sole power corporation in the Republic of Kosovo.

History
Plans to update Kosovo's power system began in the early 2000s and originally envisioned a 2,000-MW lignite plant that would allow the country to export energy to its neighbors. Political and investment setbacks caused the plant to be scaled back in size.

A 2010 EU report stated that plans for the development of a new Kosovo power plant (using lignite coal) had been reconfigured: "The initial installed capacity will be two units of 200-300 MW, the Sibovc lignite field will be developed immediately and participation in the Kosovo B power plant will be included in the package to be offered to investors with a view to refurbishment. The legal unbundling of the distribution and supply functions of the Kosovo Energy Corporation (KEK) is due at the end of 2010 with a view to privatisation. Until completion of the new Kosovo power plant project, the other functions will remain integrated in KEK."

A five-part U.S. State Department strategy for Kosovo obtained by ClimateWire suggested closing Kosovo A, rehabilitating Kosovo B to meet E.U. standards, developing a new 600-MW lignite-fired power plant, and privatizing the country's electricity distribution system.

Role of World Bank
The World Bank is considering supporting the Lignite Power Technical Assistance Project with a World Bank grant of US$10.5 million and a European Commission grant of Euros 2 million, as well as providing "advisory services" for the inclusion of private capital in the new lignite mine and power plant.

In a July 2011 statement to ClimateWire, a World Bank spokesman said the institution had not taken a decision on financing Kosovo B, and that an independent panel of experts was being tasked to determine if the project meets the bank's coal guidelines. The World Bank asked for and received written support from the Obama Administration for the World Bank to approve the loan for the new coal plant and privatize the country's electricity distribution system.

In January 2012 a World Bank analysis concluded that building a lignite coal plant in Kosovo could cost nearly twice as much money as previously estimated.

The study also acknowledged about 400 megawatts of hydro, wind and other clean energy capacity in Kosovo -- something the World Bank had previously dismissed as virtually non-existent. Yet despite newly recognized financial challenges to coal and the existence of cleaner alternatives, the World Bank ultimately concluded that a new 600 MW coal power station remained the "best and cheapest option" for replacing Kosovo's long-neglected power plants and establishing reliable power supply in the country.

Citizen opposition
Environmental groups have urged the World Bank to allow Dan Kammen, the bank's chief technical specialist for renewable energy, to do a special assessment of Kosovo's options. Kammen did an assessment in Malaysia, which then canceled a proposed coal-fired power plant in favor of alternative energy options. There is a standoff among members of the World Bank's board of directors over a proposal to eliminate coal financing for all middle-income countries. The Obama administration and World Bank officials argue that under the proposed energy strategy, coal lending is permitted for the poorest countries, and Kosovo fits into that category. Environmentalists argue that while the coal plant might meet the letter of the energy strategy, it does not meet the spirit of it, which is to develop cleaner energy sources for developing nations.

Following a World Bank report released in January 2012 that supported the construction the the proposed coal-fired power plant in Kosovo, environmental groups maintained that entrenched support for the coal project within the US State Department had obscured thinking about new, cleaner possibilities. The Sierra Club and others argued that the World Bank's analysis showed no near-term need for additional baseload capacity and noted that analysts had not actually calculated all of the costs involved in the plant or addressed Kosovo's needs for peaking power.

Estimated cost of electricity
The Sierra Club analyzed the “Terms of Reference” provided to the Kosovo Strategic Framework for Development and Climate Change Expert Panel on whether the proposed plant meets World Bank policy and determined that it does not, as "the cost of electricity that would be provided by the Kosovo plant is grossly underestimated" because "the predicted cost of electricity is based on the assumption that all four surviving Kosovo units will operate 85 per cent of the time" yet "overall demand would [likely] be 20 percent, not 85 percent, thus tripling the cost of generation for this plant." The report concluded that the plant will likely cost 2-3 times what project proponents claim, and that the country does not have enough base load demand to justify such a large power project.

The World Bank countered in a report stating that the coal plant will cost twice as much as first estimated, but still advocated its construction.

Related SourceWatch articles

 * Global use and production of coal
 * International Information on Coal
 * Kosovo and coal
 * Europe and coal