Tag: Energesman; waste crisis; Algirdas Blazgys; Vilnius

It was not our financial position but the changed position of the Vilnius City Municipality towards participants in the waste management market that was the main cause of the waste crisis. The municipality’s position began to change in the spring, when the Mayor of Vilnius met with an Icor shareholder, and municipal officials began corresponding with representatives of the group.

The plan – to terminate the contracts

“It is like a marriage – love ends when someone else comes along. The existing partner suddenly becomes bad and unsuitable, and there is no longer any willingness to make the relationship work. In our view, the new head of VAATC took office with the aim of implementing a plan that had already been prepared – to take over the operation of the sorting plant and its reconstruction,” says Algirdas Blazgys, CEO of Energesman.

The head of VAATC wrote on social media that he had taken office to implement changes.

“After taking up his position, the first thing he did was visit the Vilnius Cogeneration Power Plant, whose head has publicly admitted that he already knew in advance that our contracts would be terminated,” says Algirdas Blazgys, CEO of Energesman.

Adomas Bužinskas, Director of the Vilnius City Municipal Administration, is not telling the truth when speaking about the suspended payment for the reconstruction of the plant and claiming that “we were happy to agree to transfer [the money] directly to the manufacturer.”

VAATC refused to make direct payments to equipment manufacturers, even though all tripartite agreements had been submitted by Energesman. VAATC nevertheless deliberately failed to make the payments.

“The Mayor and his team are now simply trying to justify their actions, which have made the situation worse for the residents of the Vilnius region. Their waste is now being handled at two to three times the cost, by companies that do not have the necessary permits and at sites that are not designed for this purpose. It is only a matter of time before this increase in costs is reflected in the bills received by residents,” says A. Blazgys.

Payments suspended

Before VAATC suspended payments, Energesman was already experiencing a shortage of working capital. However, VAATC’s decision to suspend contractual payments turned the situation into a critical one and restricted the company’s ability to continue waste management operations and reconstruct the plant.

To date, VAATC owes Energesman EUR 6.13 million.

“In the second half of June, VAATC suspended all payments and has still not settled its outstanding payments for services provided in May, June and July, as well as for the modernisation of the plant. It should be understood that the newly appointed head of VAATC could not have stopped the scheduled payments within his first few days in office – the payments are made by a separate VAATC department. It took some time to stop the mechanism, but eventually that is what happened,” says A. Blazgys.

VAATC is also misleading residents and journalists by using the term “advances” instead of “payments”, even though this does not accurately describe the situation.

“VAATC has not paid us for services that have already been provided – these are payments, not advances. An advance is paid before the services are provided. We have never received any advances; we were waiting for payment for services that had already been provided,” A. Blazgys stresses.

The Department cannot substantiate its claims

The claims made by the Environmental Protection Department that the plant site allegedly contained “unsorted mixed municipal waste that had been brought there before the fire in April 2025” are defamatory.

There is no official document substantiating this claim. The company asked the Department to provide such a document, but it has never been provided.

“In our view, the Environmental Protection Department was part of this non-transparent plan. Its assessments are unreliable and selective – we are penalised for placing a container outside the fence because it allegedly does not comply with the requirements of the IPPC permit, while other companies have been storing waste outside their sites for twenty years, handling waste without any permits at all, and receiving no penalties. Until the appointment of the new head, the work of this department reminded us very much of the activities of the State Plant Service,” A. Blazgys stresses.

“Orders” placed with the fire service?

The Fire and Rescue Department played an important role in this story too. In July, it received a complaint, on the basis of which it carried out an unscheduled inspection. Its findings were issued precisely on the day the contracts were terminated.

“We have never heard that the Department has an ‘order window’ for unscheduled inspections, but apparently it is available to certain people,” A. Blazgys says.

Even before the fire, Energesman had approached VAATC and the Vilnius City Municipality requesting an additional plot of land where waste prepared for incineration could be stored. However, no such plot had been provided by this summer, and without it, it is impossible to ensure compliance with fire safety requirements. VAATC and the municipality were aware of this.

“Two months after the fire, the firefighters issued instructions requiring permanent fire detection and suppression systems to be installed throughout the building. But we all understand that this cannot be done until the building has been reconstructed,” A. Blazgys stresses.

They did not want the crisis to be avoided

Following the fire in April 2025, VAATC was extremely slow in coordinating the contracts for the reconstruction of the plant. More than a year passed before a settlement agreement was reached and a public procurement procedure for the plant’s reconstruction was completed. Nevertheless, this was finally done in the spring, and the contracts were signed.

Around the same time, however, the Mayor of Vilnius met with an Icor shareholder, who expressed an interest in returning to the waste management business.

“Already in June and July, we were saying that we could clear all the waste at the plant within a few weeks if only the contractual payments were made. There would have been no crisis. But VAATC and the Mayor of Vilnius did not want that, because the plan was different – to take over waste management,” A. Blazgys stresses.

Energesman has now initiated five legal proceedings against VAATC and the Vilnius City Municipality, and the company has also appealed to the prosecutor’s office. Until the courts issue final decisions, Energesman maintains that both the contracts for the operation and the modernisation of the Vilnius waste plant remain valid.

According to preliminary estimates, Energesman’s losses will amount to approximately EUR 20 million. The losses may increase further the longer VAATC remains in control of the plant.

The operator of the Vilnius waste sorting plant, Energesman, confirms that shortly after VAATC initiated the termination of the contracts, a shareholder of the company met with VAATC CEO Marius Švaikauskas. The meeting was arranged by a third party. During the meeting, the head of VAATC proposed a compromise: Energesman would be allowed to continue carrying out the modernisation contract if it agreed not to challenge the termination of the operating contract. The offer was rejected.

The meeting took place at 7 p.m. on 14 July at a cigar club in Vilnius. On 16 August, Skirmantas Malinauskas reported on the meeting in his podcast, saying that he had been told about it by Vilnius Mayor Valdas Benkunskas. However, the Mayor incorrectly described both the location and the content of the meeting.

“First of all, we want to make it clear that Skirmantas Malinauskas was not discussed at the meeting. We have no influence whatsoever over the content produced by the blogger. The account of the meeting allegedly relayed to him by the Mayor of Vilnius also does not correspond to reality. We believe this was a deliberate attempt to spread false information and discredit our company,” says Algirdas Blazgys, CEO of Energesman.

During the meeting with Energesman’s shareholder, VAATC CEO Marius Švaikauskas proposed a compromise: if Energesman did not challenge the termination of the operating contract, VAATC would allow the company to continue carrying out the modernisation contract, which Energesman had secured after winning an international public procurement tender. The company won the tender with the lowest bid.

“We rejected the offer because this is not a marketplace where a municipal company can terminate contracts whenever it chooses and pressure suppliers into giving up activities to which they are legally entitled. Our contract remains valid for another ten years, and we are prepared to continue carrying it out once we prove that it was terminated unlawfully,” says A. Blazgys.

During the meeting, M. Švaikauskas also acknowledged that VAATC would be prepared to enter into a settlement agreement with Energesman if the court granted interim measures concerning the termination of the contract.

The decision of the Vilnius Regional Court not to grant interim measures has now been appealed to a higher court.

“The conduct of the VAATC CEO clearly indicates that the termination of the contracts is part of a process aimed at redistributing the market, being carried out by VAATC and the Vilnius City Municipality through what appears to be unlawful coordination of their actions. Offers based on pressure further confirm that VAATC has no right to terminate the contracts and is using the terminations as an unlawful means of putting pressure on Energesman. We have no information indicating that the VAATC CEO had formal authorisation from the board to make the offers in question,” says attorney Dr Paulius Miliauskas, partner at the law firm Miliauskas ir Lauraitytė.

According to the attorney, questions also arise as to why M. Švaikauskas discussed the content of the meeting with the Mayor of Vilnius.

“M. Švaikauskas is not subordinate to the Mayor of Vilnius – he reports to the VAATC board, on which the Vilnius City Municipality is represented by municipal employee Dalius Krinickas. This communication raises serious questions about a possible abuse of the VAATC CEO’s authority and the Mayor’s abuse of office,” says P. Miliauskas.

The Vilnius Regional Court has already accepted two claims filed by Energesman challenging the termination of both contracts – the operating contract and the modernisation contract. The court has also granted interim measures prohibiting VAATC from demanding, and the insurance company from paying out, the contract performance guarantees, which are worth EUR 1.3 million.

Pending a final court ruling, Energesman maintains that both the operating and modernisation contracts for the Vilnius waste sorting plant remain valid. The company bases its position on the provision of the operating contract that termination is possible only if two conditions are met: there must be significant grounds for termination and 20 working days’ notice must be given.

In Energesman’s view, the grounds cited by VAATC are not significant because the decisions of the Vilnius Emergency Operations Centre (ESOC) and its head (ESOV) deliberately discriminated against the company, while the accumulation of waste at the plant resulted from the Vilnius combined heat and power plant being unable to accept waste for incineration, rather than from any fault on the part of the operator.

At the same time, VAATC itself failed to perform its obligations under the modernisation contract by failing to make the EUR 4.4 million initial payment to Energesman within the contractual deadline.

According to preliminary estimates, Energesman’s losses will amount to approximately EUR 20 million. These losses may increase further the longer VAATC remains in control of the plant.

Mixed municipal waste in the Vilnius region is being handled by companies that do not have the permits required for such activities – namely, “Ekobazė”, “Ekonovus” and VAATC. Another company, “Ecoservice”, is storing more waste than permitted. Under the contracts signed with these companies, EUR 7.2 million in fees collected from residents for waste management will be paid to companies allegedly operating in violation of the applicable requirements.

The operator of the Vilnius waste sorting plant, “Energesman”, has referred VAATC’s operation without a Pollution Prevention and Control (IPPC) permit to the Prosecutor’s Office.

“All companies currently handling mixed municipal waste in the Vilnius region are violating the law, yet so far everyone seems to accept these double standards. We hope that the principles of the rule of law will be restored, because at present companies favoured by the Vilnius authorities can commit offences with impunity while receiving millions of euros collected from residents,” says Algirdas Blazgys, CEO of “Energesman”.

Permitted to handle plastic – but not household waste

“Ekobazė” handles mixed municipal waste at Lentvario g. 13A, Vilnius. Under the pollution permit issued for this site (TL-V.7-49/2016), the company is authorised to handle only non-hazardous waste intended for recycling – separately collected plastic, paper, metals, glass and similar materials. This permit does not authorise the company to handle household waste.

Under the signed contract, the company will be paid EUR 2.1 million for such waste management without the required permit.

“Ecoservice” exceeds the permitted limit

“Ecoservice” handles mixed municipal waste at its site at Gariūnų g. 71, Vilnius. The pollution permit issued to the company (TL-V.7-86/2018) allows it to store no more than 800 tonnes of mixed municipal waste at this site.

“It is visually apparent that this limit is being exceeded, and the amount will increase further once the “Ekonovus” waste stream is taken over. Currently, around 250 tonnes of waste are delivered to the site every day; next week this will increase to 350 tonnes, while only a few dozen tonnes are transported for incineration. It is therefore clear that the amount of waste accumulated on the site exceeds the maximum permitted under the permit,” says A. Blazgys.

By the end of the year, “Ecoservice” is expected to receive EUR 3 million for waste management carried out in violation of the applicable requirements.

“Ekonovus” is not authorised to handle waste at all

“Ekonovus” continues to handle waste at Pramonės g. 141 in Naujoji Vilnia, despite strong opposition from local residents.

The site belongs to UAB “Šatruva”, which holds a permit to handle construction waste there (TL-V.7-52/2016). Mixed municipal waste cannot be handled at this site.

Moreover, “Ekonovus” itself has no pollution permit authorising waste management activities at Pramonės g. 141 and therefore cannot legally handle any waste there.

“Ekonovus” would also be unable to handle waste at the planned site at Sandėlių g. 12 in Vilnius, near Gariūnai. No pollution permit has been issued to the company for this address, meaning that, under the law, no waste may be handled at this location.

Moreover, the site is not equipped for waste management. It is essentially an undeveloped area without a hard surface or fencing, and no wastewater collection system is visible. A road is currently being constructed on the site to allow waste collection vehicles weighing several tonnes to access the area without getting stuck in the ground.

Under the signed contract, the company would receive EUR 2.1 million in public funds for such waste management without the required permit.

VAATC has been operating the plant without a permit for more than a month

VAATC, which took over the Vilnius mixed waste sorting plant on 24 July, has been handling waste there for more than a month without the required pollution permit (IPPC permit).

The permit is still issued in the name of “Energesman”, and the company does not agree to its transfer to VAATC while legal disputes over the lawfulness of the contract termination remain unresolved.

“We have referred the matter to the Prosecutor’s Office over potentially criminal activity, because operating without the required waste management permit is a criminalised offence in Lithuania. It is difficult to understand why no exceptions were made in our case – we were subject to extremely strict scrutiny to ensure compliance with all permit requirements. Although the emergency situation should apply equally to everyone, it is clear that this is not the case,” says A. Blazgys.

Earlier, in mid-August, the Environmental Protection Department also referred the matter to the Prosecutor’s Office, asking it to assess whether VAATC, “Ekonovus”, “Ecoservice” and “Ekobazė” are legally handling mixed municipal waste without the necessary permits.

Contract terminations are being challenged in court

Pending a final court ruling, “Energesman” maintains that both the operating and modernisation agreements for the Vilnius waste plant remain valid. The company bases its position on the terms of the operating agreement, which provides that it may be terminated only if two conditions are met – there are significant grounds for termination and 20 working days’ notice is given.

In “Energesman’s” view, the reasons cited by VAATC do not constitute significant grounds because decisions by the Vilnius Emergency Operations Centre (ESOC) and its head (ESOV) deliberately discriminated against the company, while the accumulation of waste at the plant resulted from the Vilnius combined heat and power plant being unable to accept waste for incineration, rather than from any fault on the part of the operator.

“If other companies are allowed to store more waste than their permits allow, or to handle waste without permits altogether, our contract cannot be terminated on such grounds,” A. Blazgys emphasises.

VAATC itself failed to perform the modernisation agreement and did not pay “Energesman” the EUR 4.4 million initial payment within the deadlines stipulated in the contract.

According to preliminary estimates, “Energesman’s” losses will amount to approximately EUR 20 million. These losses may increase further the longer VAATC remains in control of the plant.

The Vilnius Regional Court has granted the requests of Energesman, operator of the Vilnius waste treatment plant, and imposed interim protective measures in two separate cases. The court has prohibited VAATC from claiming, and the Lithuanian branch of BTA Baltic Insurance Company from paying, the contract performance guarantees. The total value of the guarantees under the operation and modernization contracts is approximately EUR 1.3 million.

The payments are prohibited until final and binding court decisions are issued in the two cases concerning the legality of the termination of the Vilnius waste treatment plant’s operation and modernization contracts. VAATC had already approached the insurance company and requested payment of the guarantees.

“The interim protective measures imposed by the court demonstrate that the issue of the contract terminations has not yet been resolved. It will take proceedings through at least two levels of court before a final and binding decision is reached. The question is whether, by then, the people who made these decisions and caused all this turmoil will still be leading VAATC and the Vilnius City Municipality,” says Algirdas Blazgys, CEO of Energesman.

Last week, the Vilnius Regional Court accepted for consideration two separate claims filed by Energesman challenging the termination of the plant’s operation and modernization contracts. Energesman is asking the court to order VAATC to continue performing both contracts in kind, effectively restoring the situation that existed before their termination.

In parallel, the Regional Administrative Court has begun examining Energesman’s complaint concerning decisions by the Vilnius City Municipality’s Emergency Operations Centre (ESOC) and its head (ESOC Head). The defendant in this case is the administration of the Vilnius City Municipality.

“The Vilnius City Municipality and the mayor personally played an important role in this redistribution of the waste management market. We hope the court will annul the decisions of the ESOC Head and the ESOC, as they clearly exceeded the powers granted to municipal officials under the Law on Civil Protection following the declaration of a municipal-level emergency,” emphasizes Dr Paulius Miliauskas, partner at the law firm Miliauskas ir Lauraitytė.

The head of the Vilnius City Municipality Administration, Adomas Bužinskas, still has the status of a special witness in another law-enforcement investigation into alleged abuse of office and failure to perform official duties in connection with street-narrowing projects. In the spring, searches were carried out at A. Bužinskas’ home and workplace.

Until a final court decision is issued, Energesman maintains that both the operation and modernization contracts for the Vilnius waste treatment plant remain valid. The company bases its position on the operation contract, which provides that it may be terminated only if two conditions are met: there are material grounds for termination and the other party is given 20 working days’ notice.

According to Energesman, the reasons cited by VAATC are not material, while the decisions of the ESOC Head and the ESOC deliberately discriminated against the company. The company also maintains that the accumulation of waste at the plant resulted from the Vilnius cogeneration plant being unable to accept waste for incineration, rather than from any fault on the part of the operator.

Meanwhile, VAATC itself failed to perform its obligations under the modernization contract by not paying Energesman the EUR 4.4 million initial payment within the contractual deadline.

According to preliminary estimates, Energesman’s losses will amount to approximately EUR 20 million. The losses may increase further for as long as VAATC remains in control of the plant.

„Pixabay“ photo

The operator of the Vilnius waste treatment plant, Energesman, has filed two separate claims with the Vilnius Regional Court challenging the unlawful termination of the plant’s operation and modernization contracts. Energesman is asking the court to order VAATC to continue performing both contracts – effectively restoring the situation that existed before their termination.

Energesman is also asking the court to prohibit VAATC from claiming payments under the contract performance guarantees from the insurance company. The guarantees amount to approximately EUR 1.3 million, and VAATC has already requested that the insurer pay these amounts to VAATC.

“We are seeking to restore justice so that we can continue treating mixed municipal waste from the Vilnius region and modernize the plant as originally provided for in the contracts. This is the only way to prevent waste management costs for residents from increasing. Otherwise, waste management could cost residents two to three times more, as VAATC will not be able to operate the plant as efficiently – something we can already see in other regions, where municipalities manage waste at twice the cost,” says Algirdas Blazgys, CEO of Energesman.

With these claims, Energesman is challenging the termination of the contracts in court for the first time. Until now, the company had only applied to the court for interim protective measures.

“We hope that the court will examine the situation on its merits, assess all the circumstances and take into account the facts we have presented. They show that the actions of the Vilnius City Municipality and VAATC were coordinated unlawfully. For example, VAATC refers in its documents to decisions by the Vilnius City Emergency Operations Centre (ESOC) and its head that had not yet been officially adopted at the time. How could VAATC have known the contents of a document that did not yet exist?” asks Dr Paulius Miliauskas, partner at the law firm Miliauskas ir Lauraitytė.

The Vilnius City ESOC is currently headed by Dalius Krinickas, who is also a member of the VAATC Board. As the ESOC is expected to regulate relations between all market participants impartially, this raises legitimate questions about a potential conflict of interest.

“The takeover of the plant was carried out specifically on the basis of unilateral decisions by the Vilnius ESOC and its head. However, in this case, Vilnius municipal officials exceeded their powers. If the court confirms this, the entire takeover of the waste treatment plant will collapse, and those responsible should face the consequences through law enforcement,” emphasizes P. Miliauskas.

Energesman has already appealed the ESOC decisions to the Regional Administrative Court.

Until a final court ruling is issued, Energesman maintains that both the operation and modernization contracts for the Vilnius waste treatment plant remain valid. The company bases its position on the terms of the operation contract, which provide that the contract can only be terminated if two conditions are met: there are material grounds for termination and the other party is given 20 working days’ notice.

According to Energesman, the reasons cited by VAATC are not material, while the ESOC decisions deliberately discriminated against the company. The company also maintains that the accumulation of waste at the plant resulted from the Vilnius cogeneration plant being unable to accept waste for incineration, rather than from any fault on the part of the operator.

Meanwhile, VAATC itself failed to perform its obligations under the modernization contract by not paying Energesman the EUR 4.4 million initial payment within the contractual deadline.

VAATC has also not yet returned Energesman’s property located on the plant premises. The value of this property is approximately EUR 3 million. Some of Energesman’s property has been removed from the plant premises by VAATC without notifying the company.

According to preliminary estimates, Energesman’s losses will amount to approximately EUR 20 million. The losses may increase further for as long as VAATC remains in control of the plant.

The court has not yet ruled on the legality of the termination of the Vilnius waste treatment plant contracts. The plant operator, Energesman, maintains that both the operating and modernization contracts remain valid and that their termination is unlawful, as there are no substantial grounds for doing so. Separate legal actions will be filed challenging the termination of these contracts.

The decision of the Vilnius Regional Court not to apply interim measures regarding the contract termination is based on decisions adopted by the Emergency Operations Centre (ESOC) and its Head (ESOV), an institution subordinate to the Vilnius City Municipality. Those decisions have already been appealed before the Regional Administrative Court.

“The courts are being misled because the ESOC and ESOV decisions present distorted information. This is a political institution currently headed by Dalius Krinickas, who is the mayor’s right-hand man in this market redistribution process. They adopt whatever decisions they wish, and those decisions immediately acquire legal force,” says Algirdas Blazgys, CEO of Energesman.

The decisions adopted by the Vilnius ESOC and ESOV are, in Energesman’s view, non-objective and discriminatory toward other regions and market participants that are not politically favoured. Recently, the Vilnius ESOC decided that the Vilnius cogeneration plant should not accept waste from the Alytus and Utena regions for incineration, a decision to which both regions have already expressed opposition. The Elektrėnai Municipality, where the Kazokiškės landfill is located, has also objected to the Vilnius ESOC decisions.

“The Vilnius ESOC and ESOV are exceeding their powers, because under the Law on Civil Protection a municipal-level emergency situation does not give the centre the authority to alter contractual relations. Nevertheless, courts must rely on these decisions until they are annulled, because they have been issued by an official public authority. This is precisely why we are simultaneously challenging all ESOC and ESOV decisions in court, as they currently form the basis for the entire situation,” says Dr Paulius Miliauskas, attorney-at-law and partner at the law firm Miliauskas ir Lauraitytė.

Under the waste treatment plant operating agreement, the contract may be terminated only if two conditions are met: there must be substantial grounds for termination and the other party must be given at least 20 working days’ notice.

“In our assessment, VAATC has failed to identify substantial grounds that would justify unilateral termination of the contract. We therefore consider the operating agreement to remain in force. The final decision on this matter will be made by the court,” says Dr Miliauskas.

If the court determines that one or both contracts with Energesman—the plant operating agreement and the modernization agreement—were terminated unlawfully, VAATC will be obliged to compensate the losses incurred. According to preliminary estimates, those losses amount to approximately EUR 20 million. The losses may continue to increase as the period during which VAATC has taken over the plant becomes longer.

During a podcast with Algis Ramanauskas on Thursday, Vilnius Mayor Valdas Benkunskas resorted to “dirty tactics” by claiming that the operator of the Vilnius waste treatment plant, Energesman, had allegedly “deliberately started withdrawing money from the company” in spring. The operator stresses that such statements do not reflect reality. This can easily be verified by law enforcement authorities by examining the company’s bank statements.

Spreading unfounded conspiracy theories

“The mayor has sunk very low – to the level of Eastern propaganda methods, using dirty tactics and spreading conspiracy theories. His statements are defamatory. This is extremely inappropriate for a politician of such a high rank and appears desperate,” says Algirdas Blazgys, CEO of Energesman.

After the fire, Energesman continued managing waste at the damaged plant. As a result, operating costs increased significantly due to the need to rent additional equipment, comply with instructions from the Vilnius City Municipality’s Emergency Operations Centre (ESOC), and restore the plant building.

The company’s annual financial report shows that Energesman recorded a loss of EUR 0.56 million last year.

“What money could you possibly ‘take out’ of a company operating at a loss? Nothing. We were putting money into the company to pay employee salaries, electricity bills, and fuel costs for loaders. After the fire, we financed regional waste management from our own funds to ensure that operations did not stop,” says A. Blazgys.

Municipality covered 0.4% of costs – yet calls it significant support

Since the fire, the Vilnius City Municipality has provided EUR 15,980 to cover additional costs. The other seven municipalities in the region and VAATC provided not a single euro. The mayor of Vilnius has not visited the plant even once since the fire.

During the podcast, the mayor described this support as a major effort:

“After the fire, we really made significant efforts to help the same company get back on its feet. We provided a lot of assistance and signed agreements for the restoration.”

“The mayor’s support amounted to 0.4% of the increased costs – a drop in the ocean. We were left to cover all additional expenses ourselves because we received no support from VAATC or the municipalities,” says A. Blazgys.

However, he draws attention to another aspect of the mayor’s statements:

“The mayor speaks as if he personally, rather than VAATC, made all decisions regarding contracts – their signing and termination. This clearly undermines the principle of institutional independence. Is VAATC merely a tool controlled by the mayor for redistributing the waste management market?”

VAATC debt exceeds EUR 6 million

VAATC’s debt to Energesman currently amounts to EUR 6.12 million. This includes EUR 1.23 million unpaid for services provided in May and June, and EUR 0.49 million for services provided in July. An additional EUR 4.4 million is owed under the plant modernization agreement.

“VAATC is seriously failing to fulfil its obligations under both the operating and modernization agreements. Its debt to us continues to grow, as we are already calculating late payment interest,” says A. Blazgys.

Funds were needed for equipment and ESOC decisions

Throughout the period following the fire, Energesman rented additional mobile equipment because two stationary sorting lines had been destroyed. The company paid EUR 100,000 per month for this equipment rental. In total, EUR 1.4 million (including VAT) was spent on renting mobile equipment. These costs were covered solely by Energesman.

As the emergency situation continued for an extended period, Energesman requested that VAATC, as the plant owner, rent the necessary equipment itself and provide it for the operator’s use. However, VAATC rejected this request.

Energesman also incurred approximately EUR 1 million (including VAT) in additional costs while implementing various ESOC instructions, including transporting waste to other regions, using more expensive incineration facilities, and managing additional waste streams.

Another EUR 0.3 million (including VAT) invoice was issued to Energesman by VAATC itself for the storage of 14,000 tonnes of unsorted waste at the Kazokiškės landfill. The decision to transport waste to the landfill was also made by ESOC.

Energesman has already invested approximately EUR 1 million in restoring the building and purchasing construction materials. The company has also spent additional funds on initial orders for new sorting equipment to modernise the plant.

Meanwhile, VAATC has not provided Energesman with any payment deferrals or discounts that could have helped stabilise disrupted cash flows.

VAATC and the Vilnius City Municipality frequently claim that waste carriers had to wait in long queues while the Vilnius waste treatment plant was operated by Energesman. What they fail to mention is that, in June, VAATC refused to launch the electronic queue management system installed this spring. The system would have regulated traffic flows and carriers arriving according to schedule would not have had to wait. The launch of the system was halted after a change in VAATC’s management.

The implemented solution is being omitted

“An extraordinary degree of cynicism is required to stand up at a meeting of the Committee on Environment and City Services and blame someone else when you yourself deliberately refused to improve the situation. Employees had already been trained to use the queue management system, but VAATC intentionally refused to launch it so that the queue problem would remain,” says Algirdas Blazgys, CEO of Energesman.

On 18 March this year, VAATC signed a contract with UAB Teracode, operating under the Logifly brand, to install an electronic queue management system at the Vilnius waste treatment plant for use by waste carriers. The contract value amounted to EUR 8,800.

Public procurement contract: https://viespirkiai.org/sutartis/2008048337

Project halted after the appointment of a new VAATC CEO

The system was scheduled to become operational on 1 June. Display columns had already been installed at the plant entrance and connected to the network. Energesman had ordered and connected the modems and internet service, and the system had been fully tested.

Employees of both VAATC and Energesman, including the logistics manager and weighbridge operators, had been trained to use the system. The only remaining step was to provide training for the carriers, and the queue issue could have been resolved in June.

However, after Marius Švaikauskas became CEO of VAATC on 28 May, the project was suddenly suspended and has never been launched.

“This can only happen in one situation: when you arrive with the goal of removing the operator rather than working together with it. There is no other explanation for such actions,” Mr Blazgys emphasizes.

Priority for carriers arriving according to schedule

Under the installed system, carriers arriving at the waste sorting plant would scan a QR code. The system would automatically create two separate queues. The first queue would be for carriers arriving at their designated time according to a pre-agreed schedule. The second queue would be for carriers arriving earlier or later than their allocated time.

Priority for unloading waste would be given to carriers arriving on time. As a result, they would not have had to wait in the general queue.

“This would have solved the core problem: some carriers arrive not according to the agreed schedule but at a time convenient for them, which creates congestion and leads to waiting times,” Mr Blazgys explains.

Records show that in the period following the fire, 50% of carriers arrived outside their allocated time slot—meaning every second waste collection vehicle. This disadvantaged carriers that arrived on time, as they still had to wait in the common queue.

Energesman, for its part, consistently complied with the schedule established by the Emergency Operations Centre, which required the plant to receive at least six waste collection vehicles per hour. This meant that each vehicle was allocated ten minutes for weighing and unloading waste.

No violations by Energesman related to non-compliance with this schedule have been recorded.

Among the carriers was a company seeking to acquire the operator

It is important to note that the majority of waste from the Vilnius region is collected and transported by Ecoservice and Ekonovus.

It was Ecoservice that, through one of its executives and via a third party, submitted an offer to Energesman’s shareholder to purchase the company’s shares. The offer was made just a few days before VAATC announced a warning of its intention to terminate its contracts with Energesman.

The operator of the Vilnius waste sorting plant, “Energesman”, has appealed to the Regional Administrative Court, seeking to annul the decisions of the Vilnius Municipal Emergency Operations Centre (ESOC) and the Head of Emergency Operations (ESOV), which allowed the company’s activities to be completely suspended and taken over by other market participants.

“Energesman” filed the complaint with the Vilnius Chamber of the Regional Administrative Court on Monday, 3 August.

In July, ESOC and ESOV adopted decisions that effectively reorganised the waste management system in the Vilnius region – reallocating responsibilities among market participants and establishing waste incineration priorities that prevented “Energesman” from sending sorted waste for incineration.

The complaint emphasises that ESOC and ESOV had no authority to interfere in commercial activities or make such decisions. In the event of a municipality-level emergency, neither the centre nor its head has the authority to intervene in commercial relations. However, this is precisely what happened. Intervention in commercial relations is permitted only in the event of a state-level emergency.

“The disputed decisions artificially halted all activities carried out by ‘Energesman’ and effectively set the stage for waste to accumulate at the MBA facility. For example, the Vilnius cogeneration plant was instructed to give priority to waste delivered by ‘Ecoservice’ and ‘Ekonovus’. At the same time, ‘Energesman’ was still required to accept and sort waste but could no longer send all of it for incineration, as the plant was occupied with waste from the companies given priority, as well as waste brought in from other regions. This created artificial obstacles to clearing the accumulated waste from the MBA facility,” says Algirdas Blazgys, Director of “Energesman”.

Overall, around 55% of the waste stream delivered to the MBA facility consists of combustible waste, which was previously sent to the Vilnius cogeneration plant for incineration. Once this option was blocked, “Energesman” was forced to accumulate waste at the MBA facility.

A. Blazgys also points out that the ESOC and ESOV decisions were adopted without the participation of the MBA operator, “Energesman”, in the meetings:

“We asked to participate, present the actual situation, share our insights and propose solutions, but our requests were not taken into account.”

“Energesman” and the MBA facility it operated are an important link in the waste management system of the Vilnius region. Under its MBA operating contract, “Energesman” accepted mixed municipal waste from all eight municipalities in Vilnius County and sorted it at the MBA facility. Metals, paper, plastics, glass and other recyclable materials were separated from the waste, along with waste unsuitable for recycling. Some of the processed waste is used to generate energy, with combustible waste being sent to the Vilnius cogeneration plant for incineration.

The companies that took over waste acceptance, processing and the transfer of waste for incineration from “Energesman” – “Ekonovus”, “Ekobazė” and VAATC – still do not hold the permits required for these activities.

“Pixabay” photo

The operator of the Vilnius waste sorting plant, “Energesman”, has appealed to the Vilnius Regional Court, asking it to overturn a lower court ruling that the Vilnius Regional Waste Management Centre (VAATC) interpreted as authorisation to take over the MBA facility.

On 24 July, the Vilnius City District Court imposed interim protective measures. Their purpose was to prevent “Energesman” from obstructing VAATC representatives from entering the plant premises and disposing of its property. Relying on this ruling, VAATC took control of the MBA facility, even though the ruling did not grant it such authority.

“VAATC interpreted the interim protective measures imposed by the Vilnius City District Court as authorisation to take full control of the MBA facility, even though it had not actually requested such measures. VAATC’s application for interim protective measures contained neither a request to prohibit ‘Energesman’ from carrying out its activities nor a request to prevent our employees from entering the Vilnius waste MBA facility and performing their work. We therefore appealed to the higher court, asking it to overturn the ruling that prompted VAATC’s unilateral actions and to resolve the situation on its merits,” says Algirdas Blazgys, Director of “Energesman”.

A. Blazgys also points out that VAATC is now attempting to carry out “Energesman’s” activities at the plant despite being completely unprepared to do so: it does not have the required number of employees or the mandatory Pollution Prevention and Control (TIPK) permit issued by the Environmental Protection Agency.

On 24 July, just a few hours after the disputed ruling was issued, VAATC representatives arrived at the MBA facility and handed “Energesman” employees present there an order from the VAATC director instructing them to remove their belongings and leave the premises. Since the evening of 24 July, “Energesman” has had no control over the MBA facility.

“Energesman” filed its appeal seeking to overturn the ruling with the Vilnius Regional Court on 31 July.

“Pixabay” photo