The Slovenia Times

MPs Back Loan Guarantee for TEŠ


The bill, under which the state would provide guarantees for EUR 440m of the EUR 550m loan from the European Investment Bank (EIB), has been proposed by a group of deputies led by Srečko Meh of the opposition Social Democrats (SD).

The government announced in late February that it would back the guarantee, but made its support conditional on the management of costs. It also called on TEŠ to negotiate better terms with the contractor, France's Alstom.

TEŠ has already obtained a loan of EUR 200m from the European Bank for Reconstruction and Development, which however did not request a state guarantee.

The coalition People's Party (SLS), Pensioners' Party (DeSUS) and the SD expressed support for the motion, provided that these conditions are met, while New Slovenia (NSi) opposed it.

The ruling Democrats (SDS), opposition Positive Slovenia (PS) and the junior coalition Virant List were meanwhile sceptical.

"The guarantee is necessary or else the state will let go of almost EUR 1bn of its assets and be forced to provide some EUR 450m in capital increase for refurbishment of the existing fourth and fifth generators as well as allocate almost EUR 300m for the closing down of the Velenje coal mine," Meh said.

The bill needs to be passed before 20 May, because this is the deadline for the signing of a contract on the loan and the contract with Alstrom, Meh added.

According to Infrastructure and Spatial Planning Minister Zvonko Černač, MPs were today looking for the lesser evil. "The lesser evil seems the decision to carry on with this project with a focus on minimizing costs," he said.

The minister, who was tasked by the government in mid-February to draw up reports on the past management of the project, said these reports were in "a final phase".

Bojan Starman of the Virant List said his party was very sceptical about the bill, because "numerous questions remain open".

It was "very clumsy" of those who started the project not to obtain all the necessary approvals and not to close the financial construction of the project, he stated.

Andrej Šircelj of the SDS said the government would back the project if all the necessary audits were carried out.

He nevertheless stressed that this was a contingent liability for the state, while TEŠ will save EUR 11m a year by obtaining a loan from the EIB rather than on the market.

PS MP Jože Velikonja said his party was bothered by the fact that the audit they had demanded had not been carried out fully. "We do not want to take responsibility for this project," he said.

But all deputy groups also warned against the consequences of scrapping the project at this stage.

"Not finishing it would entail high costs and it would mean a social bomb for the region," DeSUS MP Ivan Hršak said.

Mirko Brulc of the SD and Janez Ribič of the SLS highlighted the need for energy self-sufficiency. "This is an area where we cannot rely on others or we will soon find ourselves in the dark," Ribič said.

Matej Tonin of the only party which openly opposes the bill, the NSi, said Slovenia should follow the example of the EU and focus on renewables.


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