Let's Deal With It Belsat investigates illegal money cuts by Belarusian power plants


After our last year’s publications on mismanagement and nepotism in the state concern ‘Belenergo’ it was subjected to a large-scale state audit. The Minister of Energy, the director of ‘Belenergo’ and a number of the lower functionaries of this organization were laid off. But we continued our investigation and found that, despite the punishment of certain persons responsible, the schemes for pumping money that we pay for communal services remain, perhaps, with no less scope than before. And the damage from them is greater than we could imagine.

Unlawful excess profits can be obtained in ‘Belenergo’ on many things. As our past investigations showed, this is done through falsified tenders and family ties with the leadership of individual departments of this state organization. Our new investigation revealed what big money can be put in your pocket also through illegal pollution of the environment.

Masut ‘theme’

As it is known, the Belarusian energy sector works mainly on natural gas. But several times a year, during the repair work, they switch to masut, which is also stored in large quantities at all energy centers as a strategic reserve — in case of gas wars or other disruptions with the main energy resource.

Masut is stored in huge tanks. On the territory of each heat and power plant there are several such containers with the volume ranging from 2,000 to 20,000 cubic meters. With time, the so-called bottom layers — mud and hydrocarbon sediments — accumulate in the tanks and need to be cleaned. In the whole system of ‘Belenergo’ — and this is hundreds or even thousands of containers — a monopoly for cleaning these tanks is held by one private company — ‘Belkotloochistka.’ Its status is confirmed by the annual letter of the top management of ‘Belenergo.’

Using its monopoly status, ‘Belkotloochistka’ dramatically drives up the prices for its work. Thus, in 2016, it cleaned one fuel oil tank at the Berezovskaya GRES for 142,000 BYN.

To find out the market price of such work, we conducted an alternative tender — indicating all the parameters specified in the act of work performed by ‘Belkotloochistka.’

The proposals we received cost at least half as much.

 

 

 

‘Belkotloochistka’ responds to this, that its work is expensive but also high quality. As a result, they say, it’s cheaper for ‘Belenergo’ to overpay it once than to have it redone after substandard contractors. But, according to insiders, the damage from the defects of ‘Belkotloochistka’ exceeds even the losses that it inflicts on the state budget with an inflated price tag on its work. An example here could be the Rahachou boiler house, where ‘Belkotloochistka’ last year cleared a masut tank with a volume of 5,000 cubic meters at a price that, according to market insiders, is several times higher than the average market fee.

 

The main cost in this work was to dispose of about 100 tons of bottom sediments. Such fuel oil is rendered harmless by mixing it with various reagents, primarily lime, in special containers designed for such processes. But, as eyewitnesses say, this firm decided to save money and made it even easier.

“They processed about 20-30 tons of masut — that’s the top layer. And they buried the bottom sediments in the ground. They put it in the ground under the tank. And now it all is coming out,” a former employee of the Rahachou boiler house told ‘Belsat’ on condition of anonymity. – I know that a ton of masut, which cost 9.5 million in the old money, went to recycling. They took it all for themselves.”

According to the estimate, for recycling and disposal of waste, ‘Belkotloochistka’ received 34,000 BYN — it turns out that it decided to put all of this money in its pocket.

“It was supervised directly by [Mikalai Mikalayevich] Byazmen, chief engineer of ‘Belkotloochistka.’ Valyantsina Siarheyeuna Zimenka knew what was going on, she was aware of all these problems. And from the side of the CHP, there was the head of the CHP and the supervising engineer,” added the boiler room worker.

What harm could these economizing measures do to the environment? An expert unfamiliar with the situation told us that the damage to nature depends on the specific parameters of the site — in particular, its hydrological structure. That is, how much groundwater is spreading pollution around and, among other things, along the Dnieper, which flows nearby.

“The plants deteriorate, the microflora deteriorates. Everything depends on the amount of oil products. Surely it can be said that there may be water pollution, if there is groundwater,” says Yauhen Labanau, head of the environmental safety program at the Environmental Solutions Center. “In other words, these are local ecosystem changes that can lead to health effects.”

At the same time, the expert emphasizes: the territory for the construction of the boiler room is selected with the possibility of an accidental spill of oil products in mind. Therefore, the damage to the environment is probably less than in the case when this fuel oil was simply spilled in the vicinity of Rahachou. The territory of the CHP plant is designed to accommodate for a broken hose or leak, but such volumes are unlikely to fall under the calculation of accidental hose collapse. Whatever the extent of the damage, the residents of Rahachou react to this with outrage and panic.

“This is outrageous. People must bear some kind of punishment for this. We, for some reason, get punished for leaving garbage in the workplace, and they put fuel oil into the ground. Just imagine how it affects the drinking water,” said one of the residents of Rahachou.

“I’m afraid for my grandchildren and for children — for the environment. Someone does it — and someone covers for it,” said another resident.

In the opinion of our insiders, in the same way ‘Belkottoochistka’ recycled wastes from a number of other heat and power plants throughout Belarus. How do they manage to hide it?

“Because it’s a closed territory. A regular person cannot get there. They did what they wanted on the territory of the CHP,” continues our anonymous source who worked at the boiler house.

On the territory of the boiler-house, the giant scale of pollution is observed by the employees of the executive organization and the district heating plant itself. As it turned out, at least one witness at the Rahachou boiler-house wrote about this to the Ministry of Natural Resources. The inspection of the Homiel Committee for Nature Protection arrived at the scene, but they did not find the buried masut.

In a letter dated November 2, 2017, the Ministry of Natural Resources writes that the Homiel Regional Committee for Natural Resources considered the appeal of Iosif Korman on the case of presence of fuel oil on the territory of the Rahachou branch of the Zhlobin Electric Networks of Gomelenergo and found no violation of the requirements of the legislation by OJSC Belkotloochistka in the management of waste.

So can all this be a false alarm and the result of slander from competitors? Our film crew decided to check it and went to Rahachou. At the scene, we managed to get a video of what the Rahachou boiler room looks like now. In the backyard of the power station, there is a masut marsh, covered with fresh sawdust, which can not be walked around even if you simply look at it from the window of the administrative building. Why did the Homiel Committee for Nature Protection not notice something that could not be overlooked?

They were taken to the restaurant, and that’s it. Nobody saw anything,” said a former boiler room worker.

The management of the Rahachou boiler house blankly denies all this. The head of the Rahachou district heating networks, Alyaksei Dzivakou, told Belsat that nothing had been buried in the territory of the boiler room.

“All this — about 68 tons of waste — were taken away from us for recycling,” said Dzivakou.

We submitted the bucket with a masut sample, which can be seen in the video, to the laboratory for analysis. In the laboratory, we were immediately told that it was masut, but at the time of the broadcast, the official letter had not yet been received.

Mafia state inside the state

But what kind of company is this ‘Belkotloochistka’? How did it reach its inviolable status and how did this situation become possible in the domestic energy sector?

‘Belkotloochistka’ was once a state organization, but in 2011 the state equity stake was sold to a private firm ‘Alizi’, owned by the new director of ‘Belkotloochistka’, Ukrainian citizen Valyantsina Zimenka. Part of the shares was sold directly, and another part — through ‘Otuva’ company, registered in Lithuania. But despite the fact that the company became private, it remained a part of ‘Belenergo.’ This is confirmed by the annual letter of the state concern management.

 

Yauhen Voranau, the CEO of ‘Belenergo,’ confirms that OJSC ‘Belkotloochistka’ is a member of the association and is the only organization in its structure that performs cleaning of boiler units and heat exchangers, as well as of fuel oil tanks.

‘Alizi’, which owns ‘Belkotloochistka’, according to the page of this organization, is part of the ‘Timior’ group, which also belongs to Valentina Zimenko and her relatives. Prior to the purchase of ‘Belkotloochistka’, ‘Timior’ mainly worked in Russia, where many former functionaries of the Belarusian energy sector are employed. The company also employs relatives of the operating management of ‘Belenergo’ branches. In particular, the son of the director of the Svetlahorsk CHP, Valyantsin Lipsky, who, with the political science background, received the position of a standardization engineer in the Belkotloochistka. As our investigation established, last year ‘Belkotloochistka’ cleaned masut oil tanks at Svetlahorsk CHP at a price that is one and a half times or $ 20,000 higher than the market price.

But cleaning boilers and tanks is just the tip of the iceberg. ‘Belenergo’ has a large number of organizations that are now privately owned, but nevertheless continue to be part of the state concern. This is in particular, ‘Tsentrenergomontazh’, ‘Belenergooborony’ and several others. This gives them the right to receive contracts not through an open tender, but through an internal procurement procedure in which only members of the concern take part.

‘Belenergo’ is forced to tender some of the works, as, according to the decree of Alyaksandr Lukashenka No. 72 and the resolution of the Council of Ministers of the Council of Ministers No. 229, works, including in the energy sector, are to be distributed through an open competition. But the management of the concern arranges manipulation of these tenders for the self-interest of its staff in several ways.

First, organizations are required to have mandatory experience in this ‘Belenergo’ system over the past few years. This is similar to the well-known anecdote that only a person with experience can become president.

For example, Slutsk mini-CHP was previously managed by the Ministry of Housing and Communal Services. But as soon as it passed under the supervision of ‘Belenergo,’ the monopoly for cleaning of its boilers was given to Belkotloochistka, which, as our investigation revealed, carries out works there at a much higher rate than other firms on the market, both public and private.

 

 

Another trick: the right organizations are applying with the clearly unrealistic low price and win the tender. This happened at the tender for cleaning boilers at Zhlobin CHP. ‘Belkotloochistka’ won it by price, but then claimed it had not take into account in its calculation some overhead. ‘Belenergo’ canceled the results of the tender, and then gave this contract to ‘Belkotloochistka’ at a real price in line with the internal procurement procedure of giving it to an organization that won the tender.

The main way to manipulate the tender is to classify the results. Unlike the departments of the Ministry of Architecture or the Housing Ministry, ‘Belenergo’ does not have to inform the participants of the competition about the contract winner and the reasons for it.

Representatives of dozens of specialized organizations with whom we spoke about this, both private and public, state that if ‘Belenergo’ had conducted its tenders in accordance with the rules that apply to all other organizations in Belarus, the cost price of servicing the energy infrastructure could have been reduce many-fold.

This money could, for example, be used for the modernization of Belarusian heating systems, which would lower the prices for heating and electricity in our payslips many-fold. Formally, they must hold open tenders now, but they fail to do it, and the authorities do not control it and. Moreover, they cover it.

Stanislau Ivashkevich

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