Marko Milacic, director of Suez Vinca Operator d.o.o. – Landfill and incinerator plant in Belgrade biggest greenfield investment, building potential throughout Serbia

Source: eKapija Monday, 13.08.2018. 15:56
Marko Milacic, director of Suez Vinca OperatorMarko Milacic, director of Suez Vinca Operator
The preparations for the EUR 330 million investment in the municipal waste management system in Belgrade are in progress and, judging by the expectations of those in charge of the job, if the building permit is issued by late November or early December, the construction might start in early 2019.

Marko Milacic, the director of Suez Vinca Operator d.o.o, claims so in his interview with eKapija. The company was founded for one purpose only – to realize the job contracted in the autumn of 2017 between the City of Belgrade and the consortium of Beo Cista Energija, consisting of the French company Suez Groupe SAS and the Japanese Itochu I-Environment. This is the biggest public-private partnership project in Serbia, established for a period of 25 years.

The plan, Milacic adds, is for everything to be completed in 2021 or 2022 and for the facility to start working. The construction of the incineration plant – thermal power plant of 30 MW, fueled by waste instead of coal, requires about two years. Prior to that, the current landfill in Vinca will be closed and investors will start extracting landfill gas from it, as it is in their interest to start producing electrical energy as soon as possible, as this is their source of revenues. The facility for the production of electrical energy from landfill gas will have 3 MW of power.

eKapija: What precisely does Belgrade stand to get from this job?

– Belgrade gets a solution to a huge environmental problem, the Vinca landfill. The spreading of the smell, the fires, the infestation, all this will stop. There's not a lot more room in Vinca if it continues to be used this way. Professionals consider it dumping grounds rather than a landfill. A modern landfill requires higher technology, preventing waste matters from leaking into underground waters and preventing further pollution. None of this is regulated at Vinca. It is one of the world's biggest landfills or dumping grounds, with the largest one being in New Jersey.

We will, therefore, hermetically seal the old Vinca landfill and isolate it in order to prevent any further impact on the environment. The city is also obliged to have a dam constructed, a large wall which should stop the sliding of the waste into the Danube. In addition to the old one, a new landfill will open as well, with all the elements: cells, a pipeline for the collection of the seepage, waste water processing, separation, coverage. Biogas will be extracted from both the old landfill and the new one. Vinca now features a 60-70-m pile of garbage. The waste ferments and produces gas (the majority of which is methane), which is then used to produce electrical energy. This belongs to the category of green energy. We will apply for its purchase at a reduced price, which is implemented for all power produced from renewable sources: from wind farms, solar panels, biogas, landfill gas, from agricultural material fume hoods. Once we obtain the building permit, we will apply for this.

eKapija: Can the infamous pile be reduced by treating waste at the incineration plant?

– The old waste cannot be used that way. It is of problematic quality, as there are no data indicating what is located there and in which amounts. Our obligation is to close it down so that it is no longer an environmental hazard. The waste will remain there forever, or at least until a new technology is developed or an economic reason arises for the layers to be excavated. Only the new waste, then, will be suitable for incineration.

eKapija: Is recycling a part of the process to be carried out at your facility?

– No, we don't recycle. The state first has to secure waste separation and the conditions for a much larger part of it to be recycled. It has already started doing so, as it doesn't have a choice anyway. This is a long process and that's the case everywhere. Thanks to the new facilities, we will be able to reduce the volume of a part of the waste being disposed of. The global trend is for around 5% of the waste volume to be put into landfills, whereas, in some highly developed countries, such as Japan, only around 1% is disposed of. The Tokyo Narita Airport, for example, was built on a part of the sea covered with waste. Britain uses the ash from incinerator plants to pave streets. This is the so-called circular economy, which our company deals in. As you take, so you return to the nature. Just like with water treatment: you take water from the nature, process it so that it is drinkable, distribute it to the citizens, then collect it through the sewer system, process it and return it to the nature at the quality it had when you first took it. The same logic applies to waste.

eKapija: The usage of the ash from thermal power plants in road construction has been a topic in Serbia for a long time.

– The ash from the Thermal Power Plant in Obrenovac and the municipal waste are not the same. The latter is ideal for road construction.

eKapija: Belgrade is one of the rare large cities where waste waters are not treated at all before being put back into the nature. Is this another potential field in Serbia for Suez Groupe to get involved in?

– Yes, absolutely. Suez covers four fields: municipal waters, energy from waste, industrial waste materials and consulting. We are active in all these fields, and the Vinca job is currently the biggest one in the region for this company. After a long time, this is our comeback. Previously, our company worked on the construction of the Makis 1 water plant in Belgrade, but under a different name – Degremont.

In 2016, Serbia and China signed 23 bilateral agreements. One of these pertains to the construction of a waste water treatment plant in Veliko Selo near Belgrade. This is being carried out by CMEC – China Mechanical Engineering Company. They are obliged to start this project with the city within the next two years. There will be more and more such jobs in Serbia, not because we are getting closer to the European Union, but because it is simply a standard of living, which we are beginning to follow and catch up with. It is directly related to the economy, the gross domestic product of the country. As the GDP grows, so does the desire for an improved quality of life, environmental protection and opportunities. In the 1980s, we had many such project, which were never realized due to the downfall in the 1990s.

eKapija: It's nothing new to say that increased care for the environment means more job opportunities in Serbia?

– Without doubt. It should also be kept in mind that the bar raises as well. In its negotiations about the EU membership, Serbia needs to open Chapter 27, concerning ecology. Until this May, the EU proscribed that around 70% of all waste should be recycled, and the amount has now been raised to 90%. We recycle very little, an almost negligible amount of waste. This means great opportunities for projects. One of the resources is the material left over after the demolition of buildings. Vinca will handle this as well. We will be carrying out the selection, separating the waste that can be incinerated from the waste that can't be, with the latter, say, concrete, being granulated and used to even out the landfill layers.

eKapija: You realized a project similar to the one in Belgrade back in 2016 in Poznan, Poland. What are your experiences?

– The facility in Poznan is very similar to the one that will be built in Vinca, and even the team of experts is the same. In these two years, everything has been working properly. There are no problems or complaints from either the city authorities, or NGOs or the citizens. In fact, we haven't had any trouble anywhere in Europe. The technology is developed and there is no vagueness or improvisation.

In Europe, Suez manages around 40 facilities similar to the one to be built in VincaIn Europe, Suez manages around 40 facilities similar to the one to be built in Vinca
eKapija: Do you believe that the city of Belgrade might be able to realize such an investment on its own, without a PPP?

– Technologically, the city and its Utility Enterprise Gradska Cistoca have neither the knowledge nor the financial means to carry out such a project. The state is not capable of investing EUR 330 million alone. It realizes large infrastructural project by borrowing money abroad. This is in fact the largest greenfield investment. Also, how much does it cost to have someone who is only just learning be in charge of a complex job? On the other hand, there are people with experience, who already know the job, who are familiar with the potential problems and who know how to solve them. There's not one single incineration plant in the region and there's not enough knowledge about it.

eKapija: Among the subcontractors on the project of such a complex facility, how much room is there for local companies?

– Agreements with the main subcontractors have already been signed. Energoprojekt Niskogradnja is among them. The company will be in charge of the construction works on the landfill – the closing of the old landfill and the opening of the new one – as well as access roads. The French company CNIM will build the incineration plant. Furthermore, the subcontractors are also engaging related companies: Energoprojekt Oprema, Energoprojekt Entel, which is preparing the documentation, etc. Local companies and engineering are, then, quite involved in the project, except in the key parts, where it is us who have the necessary knowledge.

eKapija: How many workers do you expect to be hired during the construction and when the facility starts working at full capacity?

– Around 300-500 people at one point during the construction, I assume. Once it's completed, there will be around 110 to 115 employees. The degree of automation is great. We already have several common incineration plants with Itochu, and Suez alone manages around 40 such facilities in Europe. We are looking to make the standards uniform in order to be able to implement the experiences we've acquired. The project is very large and the equipment which will be used includes a wide range of electronic, mechanical devices, thermal installations...

eKapija: What kind of professions does this job require?

– We need people of various profiles: mechanical, electrical and civil engineers, economists, PR experts, HR experts. We also need people with higher education, but not just them. We plan to employ people who live and work at the Vinca landfill. Before the agreement was signed, the City made a list of 14 families, which will be taken care of. We intend to include some of those people in the system.

eKapija: The incineration plant in Vienna is practically located in the center of the city and is designed in line with post-modern aesthetics. Will the Vinca facility be attractive in terms of its architecture? Are such things being considered?

– Yes, the entire project is done in a modern spirit. The facility will feature a room for presentations and educational courses, as this is also a part of our mission and our obligations here. Numerous events will be held there.

The exterior of a Suez facilityThe exterior of a Suez facility
eKapija: Is there room in Serbia for more such projects?

– Considering the current prices in Serbia, there's no possibility of having a similar project be cost-effective to other local self-governments. One potential solution, however, is to establish regional landfills. We've signed an agreement with the city of Belgrade that we will take in 550,000 tons of waste annually, of which 380 tons will be incinerated. In the territory of Nis, the project would not be sustainable. The state would have to intervene and oblige the municipalities to connect within the region by law. In that case, in addition to Vinca, we could have two similar facilities in Vojvodina and at least one each in Western, Eastern and Southern Serbia. For the sake of comparison, Austria has six incinerators.

eKapija: Like Belgrade, Vojvodina is a large single area. Is it right to assume that they might be part of such a project?

– We believe that everyone can, but it's a long process, which requires law amendments, long-term stability and state strategy, but not for a period of two to three years, but 15-20. All of that then has to be realized as well.

Mirko Radonjic
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