France-headed global waste and water management company SUEZ Groupe SAS and I-Environment Investments Ltd, a subsidiary of Japan-headed ITOCHU Corporation have announced that, following an international tender held by the City of Belgrade, Serbia, they were awarded a 25-year waste management and energy project. The project will allow the closure and remediation of one of Europe's largest active landfills with the construction of an 80 MW waste-fired combined heat and power (CHP) plant.
On 29 September 2017, Siniša Mali, Mayor of Belgrade and representatives of SUEZ and ITOCHU entered into the largest Public-Private Partnership (PPP) ever signed in Serbia. The PPP is for the remediation of the Belgrade municipal waste landfill and the financing, construction and long-term operation of modern waste management facilities for the Serbian capital.
The Belgrade Waste PPP is a landmark and pathfinder project for a region which has huge investment needs in infrastructure, in particular in the environment sector. We are convinced that Public-Private Partnerships are among the best solutions to combine technical, financial and contractual performance and we are proud that the City of Belgrade selected us to bring the model to this part of Europe, said Marie-Ange Debon, Senior Executive Vice-President of SUEZ in charge of International.
Under the agreement, Beo Čista Energija d.o.o (BCE), the 50/50 joint-venture vehicle company formed by SUEZ and ITOCHU’s wholly owned UK subsidiary I-Environment Investments, the newly established project company will raise over EUR 300 million in financing to build and operate an Energy-from-Waste (EfW) combined heat and power (CHP) plant.
The CHP will have an installed capacity of 56 MWth and 25 MWe to treat 340 000 tonnes of municipal waste annually, equivalent to around 66 percent of the total municipal waste generated in Belgrade. A heat off-take agreement is in place with Beoelektrane and a power purchase agreement with EPS Snabdevanje.
Landfill remediation
The project scope also includes the closure and remediation of the existing Vinča landfill. It has been in operation since 1977 and is one of the largest active landfill sites remaining in Europe.
There is a pressing need for its early closure and the introduction of an environmentally friendly waste management system in order to improve the environment of the surrounding area. In addition, Serbia is aiming to join the European Union (EU) and the project is in line with its policy of meeting the EU’s waste management standards by 2023.
Once the new CHP is available, the joint venture will undertake the remediation and long-term aftercare of the 60 ha landfill and undertake the construction and operation of a new leachate-controlled landfill. A dedicated facility for processing 200 000 tonnes per annum of construction and demolition (C&D) waste will also be built.
Experienced partners
The tender was organized by the City of Belgrade with the support of International Finance Corporation, the private finance institution of the World Bank Group. Originally launched in 2015, five consortia were shortlisted for the second tender round by the City from the 11 that had applied. In May 2017, the City published a call for submission of final bids.
During the pre-qualification process, it was announced that the original plan was to obtain all building permits by the end of 2017 in order to complete the works and start utilizing the new facility by the end of 2019. Construction is to be managed by CNIM and Energoprojekt with plant operations slated for 2021 after which the facilities will be operated by SUEZ for a 25-year term.
Both SUEZ and ITOCHU are well positioned to undertake this project. SUEZ has an extensive experience with 40 million tonnes of waste managed annually in Europe and overseas, of which 7 million are recovered in 56 waste-to-energy facilities. SUEZ has been the first company to deliver a fully project-financed waste-to-energy facility in Central Europe under a PPP scheme, a 210 000 tonne per annum plant in Poznań, Poland which started operations in 2016.
Together SUEZ and ITOCHU have an unrivalled track record of joint developments and investments in energy-from-waste projects in the UK, including the Merseyside, Cornwall, West London, and South Tyne Energy-from-Waste facilities, altogether processing approximately 1.3 million tonnes of waste annually. This is roughly 15 percent of the UK waste to energy market.
