Project description
and objectives:
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The proposed project involves a loan to the Municipal District Heating Company
“Teplopostachannya Mista Odesi” (the “Company” or the ”Borrower”), a municipal
enterprise, wholly owned by the City of Odessa (the “City” or the “Guarantor”)
in Ukraine. The loan will finance the rehabilitation and modernisation of
existing boiler houses, replacement of pipes, introduction of new, compact
individual heating sub-stations in residential apartment buildings in the City
equipped with meters as well as energy efficiency investments in residential
buildings and installation of small co-generation plants. The investments and
institutional reforms are expected to achieve significant cost savings and
greater efficiency.
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Transition
impact:
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The proposed project will have an impact on the transition process through:
(i) corporatisation and commercialisation of the Company;
(ii) billing according to actual consumption;
(iii) transfer of skills during the implementation phase including the
procurement, design, installation and contracts supervision in accordance to
the best available international engineering practice.
(iv) Demonstration effect as the project is expected to be developed with the
assistance of the Ukrainian government and will demonstrate efficient way to
finance energy saving investments in buildings.
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The client:
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The borrower is the “Teplopostachannya Mista Odesi”. The City of Odessa acts
as guarantor.
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EBRD
finance:
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Senior loan of EUR 20 million to the Company.
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Total project cost:
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EUR 24.9 million.
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Environmental impact:
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The rehabilitation and modernisation of existing district heating
infrastructure is associated with limited environmental impacts; therefore,
the project was screened B/1. An environmental audit and analysis as well as
an environmental management plan (EMP) will be prepared as part of the project
feasibility study. The project will result in substantial environmental
benefits, including significant energy efficiency improvements as follows:
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The decreased heat consumption and a rational prioritisation of further
upgrades and renovations of the district heating system will reduce fuel
consumption and emissions from the heat production plants.
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The change towards a demand-driven business strategy, adoption of a least cost
district heating strategy, shift to alternative fuels, recovery of waste heat,
introduction of heat pumps etc. will further increase efficiency and reduce
emissions. The Bank will explore with the Client the possibility for Carbon
Finance through Multilateral Carbon Credit Fund.
The implementation of the proposed EMP for bringing the Company’s operations
into compliance with Ukrainian and EU standards will be covenanted in the Loan
and Guarantee Agreements. The Company will disclose locally a summary of the
Project and the associated environmental issues, in accordance with the
provisions for public information for the Bank’s “B” category projects.
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Technical
cooperation:
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Technical Feasibility Study. To be financed by the Government of the United
Kingdom under Sustainable Energy Initiative.
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IFRS Audit. To be financed by the Government of the United Kingdom under
Sustainable Energy Initiative.
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Corporate Development Support Programme for the Company. Funding to be
identified.
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Project designer and engineer, implementation support consultant for
procurement and contracts supervision. Funding to be identified.
For consultant opportunities for projects financed by technical cooperation
funds, visit procurement
of consultants.
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EBRD contact:
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Grzegorz Gajda, Operation Leader: gajdag@ebrd.com
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Procurement or tendering
opportunities:
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Visit EBRD Procurement
Enquiries: Tel: +44 20 7338 6794; Fax: +44 20 7338 7472, Email: procurement@ebrd.com
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General
enquiries:
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EBRD project enquiries not related to procurement:
Tel: +44 20 7338 7168; Fax: +44 20 7338 7380
Email: projectenquiries@ebrd.com
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