In the middle of the summer, on July 28th, the Ministry of Energy announced a public call for the selection of a “strategic partner” that should build solar power plants with a capacity of 1 GW, in as yet unknown locations, and hand them over to EPS for ownership.
It is a huge investment, which according to government projections will cost 1.4 billion euros, but it is realistic to expect that in the end it will turn out to be significantly more, perhaps even over 2 billion euros.
At first glance, it is not disputed that a renowned company is being hired for the construction of solar power plants, which are currently a “hit” in the energy sector – if it is not a question of brutally cheating both public procurement and the rules that Serbia agreed to when it signed the Stabilization Agreement and accession and started negotiations on EU membership.
What is it really about?
The special Law on the use of renewable energy options, passed in 2021, provides that the Public Procurement Law can be suspended for the construction of solar and wind power plants by choosing a “strategic partner” in a special procedure.
All the elements of protection of bidders that are valid during regular public procurements are excluded from that strangely conceived procedure, starting with the fact that there is no right of appeal against the decision and selection of a “strategic partner”.
There is no obligation to announce the public procurement in a timely manner, as stipulated by the law on public procurement, so that interested bidders can prepare. That’s why it’s not surprising that the public invitation was published on July 28, in the middle of summer, so that “the Vlasi wouldn’t reach out”, that is, so that someone undesirable wouldn’t think of signing up and possibly spoiling the previously announced “deal”.
In the public invitation, extremely strict conditions are prescribed: the bidder is required that the “strategic partner” has at least 5,000 employees (which is completely meaningless, because the construction of solar panels does not require a large number of workers), that in the past three years it had a turnover of over 4.5 billion euros, that in the past period “he had significant works” on the construction of energy facilities with a capacity of 25,000 MW (but not on the construction of solar panels!). Only at the end is it shyly stated that the bidder must have executed at least one contract of a similar nature for solar power plants with a capacity of 300 MW.
In other words, it is assumed that the bidder is qualified even if he has not yet built even a third of the capacity that he should build in Serbia – instead of requiring that he has built at least 3,000 MW in solar power plants, which would be appropriate for a “strategic partner”.
The term “strategic partner” was introduced into our legislation a few years ago, by the Law on Special Procedures for the Implementation of Construction and Reconstruction Projects of Line Infrastructure Facilities of Special Importance for the Republic of Serbia.
That law was used to award the construction of the 110 km long Pojate-Preljina highway to the American company Bechtel, which has special connections at the top of the American administration.
The contracted value of that work was 800 million euros, but there was a large cost overrun, so the bill will certainly be significantly higher than one billion euros.
That law was repealed at the July session of the Assembly. It is interesting what the Government of Serbia wrote in the explanation to the MPs:
Bearing in mind that the European Commission has drawn the attention of the Republic of Serbia several times, both in writing and through direct contacts, that the provisions of the Law on Special Procedures for the Implementation of Projects for the Construction and Reconstruction of Line Infrastructure Facilities of Special Importance for the Republic of Serbia are not in accordance with the legal acquis of the European Union, especially in the part related to public procurement and the selection of the so-called strategic partner, a decision was made at the Government level to repeal this law… What is particularly important to note is the fact that by repealing the Law on Special Procedures for the Implementation of Construction and Reconstruction Projects of Line Infrastructure Facilities of Special Importance for the Republic of Serbia, to be “closed” Chapter 5 and Cluster 1, which are very important in the negotiations for the accession of the Republic of Serbia to the European Union.
And now the question arises: who is the Government of Serbia making crazy when it repeals this law due to “closing Chapter 5 and Cluster 1” and then the very next day announces a new public call for a “strategic partner” in a procedure that is identical to the one from the repealed law?
By the way, it should be said that both laws were adopted at the proposal of the department headed by Zorana Mihajlović in the previous government. Bechtel was then selected as a “strategic partner” and Zorana became an American favorite in the Serbian government. Does that happy fate now await her successor, because Bechtel should once again be our “strategic partner”?
Bechtel again?
It is certain that such a bizarre public invitation would not be announced if the “strategic partner” was not already known in advance.
Our government did not overly hide the fact that “big projects” in the field of energy were being discussed with the Americans. It was also mentioned several times that American Ambassador Christopher Hill was also present at various meetings regarding “renewable energy sources”. He also publicly announced after the meeting with Bechtel, held on November 15th last year, that they discussed “strategic partnership in the field of energy“.
It should be mentioned that a large number of solar power plants are being built in Europe today, which have become very attractive due to the drastic drop in the price of solar panels. It is certain that, if Serbia were to implement a regular public procurement procedure, it would fare incomparably better.
It is easy to see what the government’s intention is. By “honoring” Bechtel, the US administration should generate some goodwill (or at least additional time) in some of the issues where the US expects Serbia to change its position: sanctions against Russia, the implementation of the Ohrid Agreement on Kosovo, the release of Milorad Dodik and his policies.
It is hard to believe that something can really be gained that way. And that “satisfaction” will certainly cost us at least 50% more than if the contractor were to be chosen in a regular way – or, to give a figure, at least half a billion euros more.
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