EBRD and multi-donor E5P fund to finance electric “green” buses for Batumi

By Loretta  Martikian

EBRD and multi-donor E5P fund to finance electric “green” buses for Batumi

First EBRD & E5P project to introduce electric buses in a country of operations

The European Bank for Reconstruction and Development (EBRD) is introducing new low-floor buses to Batumi, Georgia’s third-largest city, to improve and modernise public transport. This is the first ever project by the Bank to introduce in one of its countries of operations the use of electric buses in a municipal fleet. The project benefits from the support of the EBRD-managed multi-donor Eastern Europe Energy Efficiency and Environment Partnership (E5P) Fund, of which the European Union is the largest contributor.

The Bank is extending a €5.5 million sovereign loan to Georgia to be on-lent to the City of Batumi for the benefit of the Batumi Autotransport LLC, a municipal bus company, to acquire 10 battery-electric buses, the first ones in Georgia and 20 new buses with Euro V engines to ensure improved environmental and operational performance. The vehicles will improve the service for the city’s local population and its tourists by increasing the reliability, safety and efficiency of public transport while benefiting the environment by reducing emissions. The low-floor buses will facilitate easier access for passengers including those with limited movement, the elderly and disabled, as well as for parents with pushchairs.

An E5P grant of over GEL 4 million (€1.5 million) will be used to purchase 10 new electric buses. The European Commission along with EU member states: Czech Republic, Denmark, Estonia, Germany, Lithuania, Poland and Sweden, are the largest contributors to the Fund for Georgia. Other donors include Norway, TaiwanBusiness-EBRD Technical Cooperation Fund and the USA. Georgia is also a contributor to the E5P fund with €1 million.

Speaking at the signing ceremony in Batumi, European Commission Vice President Šefčovič said: "The EU is committed to the global transition to clean energy and these electric buses are an excellent example of that. Energy transition in transport is already under way and I am glad to see that Batumi is a pioneer for it not only in Georgia, but in the whole region."

“Transportation is one aspect we cannot do without in this day and age and therefore the movement towards clean and green transportation is very important. This is the first time electric buses will be introduced in the Caucasus and I am pleased that we will have them in Batumi. We are reducing air pollution while giving our bus users — local population and growing numbers of daily visitors and tourists — cleaner and at the same time quieter rides. Thanks to the EBRD for supporting this project, which will have a significant demonstration effect for such technology and potential for multiplication in Georgia and the whole region,” said Dimitry Kumsishvili, Minister of Finance of Georgia.

Francis Malige, EBRD Managing Director for Eastern Europe & Caucasus said: “This is the first electric bus project supported by the EBRD and the first time such buses will be used in the Caucasus. We aim, based on the successful implementation of this project, to do more to improve the environment and the lives of the citizens of Georgia. This is an important milestone.”

"Batumi has compelling ambitions towards climate change mitigation and is taking significant actions to fulfil them. By implementing the project, Batumi will be the first city in the south Caucasus where electric buses are introduced. I am confident that the project will make a significant contribution to the accomplishment of the strategic goal of the city – to become an attractive city with decent living conditions for its population and a major tourist destination of the region," said Giorgi Ermakov, the Mayor of Batumi.

The project is part of the EBRD’s Green Cities Framework, which is a programme supporting municipal “green” investments and available across all of the Bank’s countries of operations. As part of the project, the EBRD will also provide €0.8 million in technical cooperation funds to assist the development of a Green Cities Action Plan for Batumi, the corporate development and stakeholder participation programmes.

This will be the EBRD’s second initiative to modernise public transport in Batumi. In 2008 the EBRD financed the purchase of 76 mid-size diesel buses including the maintenance equipment.

The EBRD is a leading institutional investor in Georgia. Since the start of its operations in the country, the Bank has invested over €2.9 billion in 205 projects in the financial, corporate, infrastructure and energy sectors, with 91 per cent of these investments in the private sector.

Background information on E5P

The E5P is a €180 million multi-donor fund operating in the Eastern Partnership countries of Armenia, Georgia, Moldova and Ukraine. The European Union is the largest overall contributor to E5P with committed funds of €70 million. For E5P in Georgia the EU has pledged €10 million which is boosted by additional commitments from the Czech Republic, Denmark, Estonia, Georgia, Germany, Lithuania, Norway, Poland, Sweden, TaiwanBusiness EBRD Technical Cooperation Fund and the USA. The pledged funds are to help Georgia improve energy efficiency, contributing to energy security and economic competitiveness and policy dialogue, while having a positive impact on the environment.

The main objective of the E5P initiative is to use grants to leverage loans dedicated to municipal energy efficiency and environmental projects, for example the rehabilitation of water and wastewater systems, solid waste management, street lighting, local transport and the insulation of public buildings.