ATHENS –  Environmental groups have called on the European Bank for Reconstruction and Development (EBRD) to withdraw a planned loan for a Greece-North Macedonia gas pipeline, arguing that it will lead to increased pollution.

The Prague-based CEE Bankwatch Network and North Macedonia’s Eko-svest stated that the project violates European Union and national laws, as well as the bank’s environmental and social policies, as reported by Balkan Insight.

The pipeline aims to transport an additional 1.5 billion cubic meters of gas per year into North Macedonia, tripling its 2021 consumption and significantly increasing its reliance on fossil fuel imports, the groups asserted.

They pointed out that the environmental impact of greenhouse gas emissions resulting from increased gas burning was not evaluated in the project’s environmental impact assessment, nor was there a mandatory public consultation held in North Macedonia.

“Eko-svest chief Ana Colovic emphasized, “Instead of insisting on meaningful public consultation, the EBRD has turned a blind eye. A European bank must adhere to EU standards – which are mandatory for a candidate country like ours.”

The Greek gas network operator DESFA and its North Macedonian counterpart, NOMAGAS, inked a deal in September 2023, following a previous bilateral agreement between the governments to construct the pipeline.

While a loan for the project has already been approved by the European Investment Bank and a grant from the EU’s Western Balkans Investment Framework, most people in North Macedonia remain unaware, according to the report.

The proposed EBRD loan, totaling up to €98.6 million ($107.06 million), would finance the construction of the 66-kilometer (41-mile) pipeline and two gas transmission lines within North Macedonia for distribution.

EBRD stated that this initiative would facilitate North Macedonia’s “accelerated transition away from coal and towards renewable energy by decommissioning existing coal-fired Thermal Power Plants (TPPs) by 2030.”

The new gas pipeline from Greece is expected to be fully capable of transporting hydrogen in the future, serving as a potentially more environmentally friendly energy source than natural gas, as noted by the news site.

However, the environmentalists remain unconvinced by the bank’s argument. Pippa Gallop, Southeast Europe Energy Policy Officer at CEE Bankwatch Network, criticized the EU and its banks for applying double standards, advocating for a rapid phase-out of gas.

Gallop emphasized, “The EU must stop acting as a broker for the gas industry and push for a rapid phase-out; pushing eco policies for the European Union while endorsing different standards for North Macedonia and the Balkans.”

The government of North Macedonia stated that the pipeline would reduce its dependency on Russian gas, as the gas from Greece would be delivered through the Trans-Adriatic Pipeline (TAP) and LMG terminals in Greece.