Loan guarantee for Bosnia’s Tuzla 7 coal plant confirmed as illegal, 30 November 2021

A public loan guarantee for the planned Tuzla 7 coal power plant in Bosnia and Herzegovina is illegal under the Energy Community Treaty, the Ministerial Council of the Energy Community has confirmed...If realized, the project would aggravate Tuzla’s air pollution and prevent Bosnia and Herzegovina decarbonising its economy for decades to come.

A guarantee for a EUR 614 million loan from China Eximbank to build the 450 MW Tuzla 7 coal plant was cleared by the State Aid Council of Bosnia and Herzegovina in July 2018. 

Following a complaint submitted by the Aarhus Center Sarajevo and Bankwatch in September 2018, the Energy Community Secretariat twice advised the Federation of Bosnia and Herzegovina (FBIH) Parliament not to approve the guarantee, after its examination of the case indicated that it would be in breach of EU law.

However, the FBIH parliament’s House of Representatives and House of Peoples defied the warnings and approved the guarantee on 7 March and 1 April 2019...

Bosnia and Herzegovina’s independent transmission system operator has confirmed...that even if Tuzla 7 is not built, the electricity supply will not be endangered until at least 2030, and even then only if electricity consumption is at the higher end of what is expected...