Chinese wind power plant in BiH without work permit

The twenty windmills of the Ivovik Wind Power Plant on the hill between Livno and Tomislavgrad in western Bosnia have been spinning "idle" for months.

The wind power plant (VE) has not yet received a license to produce electricity, and it does not have a license for international trade that would enable Ivovik to sell electricity on the foreign market, the competent institutions confirmed for Radio Free Europe (RSE).
The only direct Chinese investment in Bosnia and Herzegovina, the value of which is estimated at more than 130 million euros provided by China's Belt and Road Initiative, was supposed to start operating last year.
The power plant should annually produce about 259 gigawatt hours, which, for the sake of comparison, is about a quarter of the electricity produced in the whole of Bosnia and Herzegovina in June 2024.
The project was started by local owners, among whom was businessman Ivan Matković. They founded the company Ivovik d.o.o. for about 1,000 euros. in 2006.
The government of Livanjska canton, in which Ivan's brother Stjepan sat, sold the concession for 30 years to that company two years later for about 20 thousand euros.
This term begins to run from the date of commissioning, which makes it impossible for another potential investor to obtain a concession for the same location.
Ivan Matković transferred the ownership to Stjepan, whose ministerial mandate ended, and the share was inherited by his children after his death. The local owners sold the majority stake in the company to the Chinese company CNTIC Capital Co. Limited and Sinohydro for an undisclosed amount, including a wind farm concession.
Chinese investors and workers started work in December 2021, and with the beginning of the construction of the wind farm, the dispute before the court in Livno began.
A group of locals claim that the local government illegally took their land and gave it to Chinese investors for use.

What permissions are missing?
Elektroprijenos BiH confirmed to RSE that the wind power plants did not issue approval for connection, because Ivovik did not submit all the necessary documentation.

"The user, along with the request for a connection permit, did not submit a use permit for the Ivovik hydropower plant facility, which also includes the high-voltage plant belonging to the user," the state-owned company that manages electricity transmission told RSE on August 29.
The use permit for such facilities is issued by the Entity Ministry for Spatial Planning. Without this permit, the building cannot be used, that is, the wind power plant cannot be put into operation.
The Ministry, according to the procedure, appoints an expert commission consisting of one engineer for each of the works - architectural, construction, mechanical, electrical, occupational safety and the like - which goes out to the field and performs a technical inspection.
The investor, in addition to other documentation, must also attach a construction permit and a copy of the cadastral plan with the location of the building.
From the Ministry of Spatial Planning of the Federation of BiH, one of the two BiH entity, stated in a written response to RSE that on August 30 of this year, they issued a use permit for the Ivovik hydropower plant, with access roads, plateaus and accompanying facilities.
When asked by RFE/RL whether the issue of the permit was hindered by the dispute initiated by the locals against VE Ivovik, who claim that their land was taken from them, the Ministry stated that in the previous procedure of obtaining the building permit, the investor "provided evidence of resolved property-legal relations, i.e. the right of construction on the plots that are included in the mentioned building, which was noted by the commission during the technical inspection".
Members of the Ivković family claim that the local government illegally confiscated their land on the Ivovik hill and gave it to Chinese investors.
"They sued VE Ivovik for trespassing. The first hearing was held last fall. Now we are in the stage of expert evidence. We expect the court's decision in the tenth month of this year," Perica Babić, a lawyer representing members of the Ivković family who sued Ivovik, told RSE .
Whatever the court's decision, both parties have the right to appeal before the cantonal and higher courts, which could drag on for several years.
The lawsuit came about after the Cadastre Office of the city of Livno, which is responsible for keeping land records and overseeing the registration of ownership, announced in 2018 an invitation to real estate owners to register their properties.
The invitation was published on the bulletin board in the municipality building and on local radio stations, and it also included private properties on the Ivovik hill. The invitation was not seen, as they say, nor heard by some landowners, including those who live abroad.

"Tell me who goes to read what is written on the bulletin board in the municipality? I only go to the municipality when I need a birth or death certificate," said Ante Ivković, one of the residents who filed the lawsuit, to RSE last year.

What are the Chinese planning with electricity?
The produced electricity can be sold by the Chinese owners of the Ivovik Wind Power Plant to local electricity companies in BiH or exported abroad.
For this, in addition to contracts with customers, i.e. electricity companies, they need permits from the competent regulators.
"VE Ivovik did not apply for the issuance of a license to carry out international electricity trade activities, nor did it previously address the State Regulatory Commission for Electricity (SERK) on any basis," they told RSE on August 29 from SERC, whose jurisdiction is issuing that license.
The Regulatory Commission for Energy in the Federation of Bosnia and Herzegovina (FERK), which is responsible for issuing licenses for the production of electricity in this entity, told RSE that VE Ivovik did not receive the necessary license from this institution either.
"VE Ivovik does not have a license for the activity of electricity production, nor has it submitted a request to FERC for the issuance of one," said FERK on August 29 for RSE.
When asked why the power plant did not start operating within the stipulated time, VE Ivovik told RSE that "the physical construction of the power plant has been completed" and that they are now "going through a complex and often lengthy bureaucratic process" of obtaining permits and licenses for the production of electricity .
"This includes extensive paperwork, inspections, technical receptions and permits from several institutions, which can lead to delays," VE Ivovik stated in a written response to RSE, not wanting to comment on the dispute with the locals.

VE Ivovik: Trial operation coming soon
The Ivovik Wind Power Plant (VE) announced to RSE on September 19, after the publication of the article, that in the meantime they had received approval for the connection from Elektroprijenos BiH, and "other permits that are needed in order to start with testing, and soon with the trial drive, which we are working on 'full steam'".

For other necessary permits, they stated that "it is still too early to apply for them" and that VE Ivovik did not apply for the sale of electricity on the international market "because we intend to sell the electricity we produce on the BiH market, not trade it".
They stated that "it is a standard procedure that every similar project must go through" and that it is necessary to carry out tests under the supervision of the regulator to ensure that the power plant is safe and ready for production, "and this may take several months".

Owner of Ivovik is the  Chinese state
In September 2022, Sinohydro's company, registered in Bosnia and Herzegovina, transferred its 51 percent stake in Bosnia and Herzegovina. company VE Ivovik to the newly founded company Ivovik Wind Power registered in the "tax haven" Luxembourg.
China National Technical Import and Export Corporation (CNTIC) still owns a 39 percent stake in Bosnia and Herzegovina. company VE Ivovik, and Ekrem Nanić, a citizen of Bosnia and Herzegovina, has a ten percent share. Little is known about his affairs, and Nanić did not respond to RSE's request for comment sent to his email.
The transfer of ownership from the Chinese company Sinohydro in Bosnia and Herzegovina to the Chinese company Ivovik Wind Power in Luxembourg was preceded by a series of transactions between companies in Luxembourg, all of which are also owned by the Chinese state.
According to the contracts from the registry, which RSE had access to, the Hong Kong-based Sinohydro company established PCR Energy in Luxembourg in August 2021.

In October 2021, PCR Energy founded Ivovik Wind Power.
Both are registered at the same address and are represented by local lawyers.
The Sinohydro company is an overseas subsidiary of Power China, a large Chinese company that is fully state-owned.
That company is managed by the State Council, China's highest administrative body that manages state assets, and is under the control of the Chinese executive and the National People's Congress, or Communist Party.
Ivovik's other co-owner, CNTIC, is a state-owned Chinese engineering firm with alleged ties to China's Ministry of State Security, the main civilian foreign intelligence agency.

Sinohydro entered business in Bosnia and Herzegovina in 2019 when, as part of a consortium, it signed a contract worth more than 30 million euros for the construction of the Počitelj bridge in Herzegovina with the public company Autoceste of the Federation of Bosnia and Herzegovina.
The largest bridge on the pan-European corridor Vc, the highway that leads from Hungary through Croatia and BiH to the Adriatic port of Ploče, was supposed to be opened in March 2022.
"Due to the negative experience of breach of contract and unapproved overage", the Highways Company of the Federation of Bosnia and Herzegovina put Sinohydro and its partners on the "black list" in May 2023.
In August 2023, it was announced that the Počitelj bridge was cracked, which led to a new delay, and it was opened on September 5 of this year.
The Ivovik wind farm was presented at the China-Central and Eastern Europe (CEEC) Summit in 2021 as a "fruit of cooperation" within the Chinese initiative called the Belt and Road, through which Chinese state-owned banks were financed worldwide.
In other parts of BiH, there is a list of projects that Chinese companies are working on or are interested in, which are financed or could be financed by Chinese banks, above all the Chinese Export-Import Bank (EXIM).
Most of them are projects in Republika Srpska, whose anti-Western president Milorad Dodik and other top officials are under sanctions from the United States of America, while Western investors are withdrawing their investments.
For example, the Prime Minister of Republika Srpska, Radovan Višković, from Dodik's Alliance of Independent Social Democrats, met in April 2023 in Beijing with the director of Power China, the parent company of Sinohydro, which is owned by VE Ivovik. They discussed, as reported, the solar power plant project that the Entity Electric Power Company of the RS intends to launch.
Chinese state banks approved loans for the construction of highways, such as the section of the highway through Republika Srpska near Brčko and between Banja Luka and Prijedor, or hydroelectric power plants such as Dabar near Trebinje in Herzegovina.
The Republika Srpska government has not released the financial details of the contract, citing "commercial interests of the Chinese partners".