Power and energy utilities showcase

Project Summary Documents

Project Summary Documents (PSDs) are disclosed for each project prior to Board consideration. They contain project descriptions, financial details, client information, environmental issues, tender guidelines, and contact details. PSDs for private sector projects are disclosed at least 30 days prior to Board consideration and for state sector projects, at least 60 days.

Project Summary Documents

Signed projects

Board approval is the final stage in the project approval process. After Board approval, the EBRD and the client sign the deal and it becomes legally binding. Signed project lists reflect year-end data.

Signed projects  (0.1Mb) 

Case studies

Improving the efficiency of Azerbaijan’s largest power plant - 2008

AzDRES thermal power plant, with a capacity of 2,400 MW, is benefiting from EBRD finance of US$ 92 million. The loan is improving the plant’s reliability, efficiency, health and safety conditions and helping to reduce carbon dioxide emissions. The AzDRES thermal power plant has eight dual fuel, gas and heavy fuel oil units of 300 MW each. The plant is currently operating below its possible capacity and efficiency levels.

The EBRD investment complements an earlier US$ 115 million loan by the Bank signed in November 2006. The sovereign-guaranteed new loan addresses the reform of the energy sector to which Azerbaijan has committed itself in close cooperation with international financial institutions.

The EBRD finance pursues a number of challenging objectives such as tariff regulation, financial reporting and qualification under the Kyoto Protocol’s Clean Development Mechanism. It is estimated that AzDRES’s CO2 emissions can be reduced by 8.2 million tonnes by 2012 thus allowing the company to qualify for carbon credits and providing an additional source of income. When coupled with the anticipated increased output of AzDRES after the implementation of the rehabilitation programme, Azerbaijan will significantly improve its energy security and reduce CO2 emissions.

Reforming the energy sector in Poland -Annual Report 2008
Poland is a key energy market in central and eastern Europe because of its size, location and solid economic performance over the past decade. Although the energy sector accounts for about 5 per cent of Poland’s GDP, the country’s ageing energy infrastructure is badly in need of investments to upgrade and reach its full potential. After previous unsuccessful attempts, the Polish government worked in 2008 with the EBRD – an experienced investor in the country – to privatise the state-owned energy supplier ENEA.
ENEA is the leading power supplier in west and north-west Poland and the second-largest electricity supply company in the country, servicing 2.3 million customers or 14 per cent of the market. The company – one of four state-owned power groups created in 2003 during the integration of the sector – includes power generation, electricity distribution and electricity supply in its operations.

In November 2008 the EBRD bought a 2.5 per cent stake in the ENEA power group at the Company's Initial Public Offering (IPO). The deal is a landmark for the privatisation of the Polish energy sector and the finance will help enable long-awaited improvements towards greater capacity and efficiency.

ENEA's listing on the Warsaw Stock Exchange was the first IPO ever made by a state-owned Polish power company. The listing is the first step in the privatisation of the company and the EBRD’s participation is crucial in inspiring confidence and encouraging other investors to enter the Polish energy market.

The funds raised through the shares sale will be invested in modernising ENEA’s electricity distribution network to cut energy losses. The money will also fund the construction of new power units at the Kozienice power plant in central Poland and will be invested in renewable energy projects.

Charging up Russia’s power sector

One of the most ambitious elements in Russia’s project to dismantle old state controls of its economy is the reform of a once-centralised state electricity business, splitting it into separate generation, transmission and distribution companies and turning yesterday’s unwieldy monolith into tomorrow’s multi-player market.

As the Russian economy grows, and electricity consumption rises by more than 5 per cent a year (making it ever more important to rebuild the nation’s outdated energy infrastructure), RAO UES, Russia’s largest power utility, is being split into separate generation, transmission and distribution companies.

The EBRD’s pivotal role in this giant reform is confirmed as the first shares in one of the new generation companies are sold to private investors. In November 2006 the EBRD threw its weight behind a landmark first initial public offering by one of Russia’s six wholesale generating thermal companies by acquiring a minority stake in OGK-5.

This investment is part of the strategy of OGK-5’s controlling shareholder, RAO UES, to raise private funding on the open capital market for the investment programme. The Bank’s decision to take about 7.5 per cent of the equity publicly reaffirms the EBRD’s support for the latest phase of Russia’s power sector reform.

The Bank has been involved in the multiple-stage reform since 2001, when Russia’s electricity supremo, Anatoly Chubais, the Chief Executive Officer of RAO UES, asked the EBRD for help in dismantling Russia’s electricity monopoly. Now the programme has reached its third stage, in which the state prepares to bow out and investors step in to take strategic stakes in newly separated electrical entities unbundled from RAO UES.

The strategy of the Russian government and RAO UES is to attract investors to participate in capital increases that will finance urgent refurbishment and new capacity needs. OGK-5, with two of its four plants in the fast-growing central Russian Ural region, has high investment needs. Proceeds from the November public offering of 5.1 billion shares will be ploughed back into modernisation and developing new capacity.

The equity sale brought RAO UES’s stake in OGK-5 down from 87 per cent to about 75 per cent. A second equity sale to a strategic investor, this time of 25 per cent plus one share, is planned for 2007.

The EBRD’s Strategy for Russia, approved in 2006, commits the Bank to pursuing equity investments in generating companies. “The interest of private investors in the sector will, from now on, be one of the determining factors of the overall success of the reforms,” said the CEO of OGK-5, Anatoly Bushin. “The Bank’s involvement sends supportive signals that private capital can successfully be attracted in the Russian power sector.”

The EBRD participation in OGK-5 was conditional on the company agreeing to improve environmental performance and corporate governance. A Memorandum of Understanding was signed incorporating these requirements.