The City of Novi Pazar has given up on signing an agreement to buy bankrupt textile firm Raška’s assets, including a wastewater treatment plant, a boiler facility, and other facilities, on a location designated for the construction of a new biomass heating plant, it has been confirmed for local radio broadcaster Sto Plus.

In early December, the city had won an RSD 84 million bid for the assets in (around EUR 710,000) in an auction, offering nearly six times the starting price.

Now that the local government has pulled out of the acquisition, the bankruptcy manager will offer the assets to the second-ranked bidder, local entrepreneur Amer Hadžifejzović, who bid RSD 78 million (some EUR 660,000).

Biomass heating plant project worth EUR 3.6 million

Following an earlier delay in the EUR 3.6 million project to build the biomass heating plant in Novi Pazar, as part of a wider plan for 10 district heating operators in Serbia to switch from fossil fuels to renewable energy sources, the plant was expected to be built in 2019.

A study has shown that the biomass-fired plant could provide heating to some 170,000 new users in Novi Pazar, given that a large number of public institutions in the center of the town, newly-built residential properties, and industrial facilities are not yet connected to the district heating network, assistant mayor Faruk Suljević said earlier.

The wider project to build 10 biomass heating plants in Serbia is worth EUR 27 million, EUR 20 million of which is financed with a EUR 20 million loan from German development bank KfW, which is also providing a EUR 2 million grant, and a EUR 5 million grant from the government of Switzerland.

The municipalities in question include Mali Zvornik, Nova Varoš, Prijepolje, Bajina Bašta, Valjevo, Priboj, Kladovo, and Majdanpek.

KfW has offered the 2nd tranche of credit for an additional 15-20 district heating operators in Serbia to convert from fossil fuel to biomass. The Development of a Sustainable Bioenergy Market in Serbia program is implemented jointly by the German development organization GIZ and KfW.