An EBRD loan will help modernise Warsaw's tram system, injecting fresh investment in its trams, tracks, stations and other infrastructure. The planned refurbishment will reduce the city's carbon footprint and facilitate commuting.
As regular commuters in any major city will know: speed is of the essence. Since Warsaw commuters can currently expect to travel at an average speed of only 18 km/h on the tram (over 24 km/h is considered good quality) it is hardly surprising that most commuters still choose the car, leaving the city with major congestion problems.
The EBRD is supporting the modernisation of Warsaw’s tram system with a loan of up to PLN 200 million (about €49.2 million) to Warsaw Tramways, which is wholly owned by the city of Warsaw. It will help finance a major investment programme, including the acquisition of 186 energy efficient modern trams, the modernisation of 29 kilometres of tram tracks and refurbishment of tram stops and related infrastructure.
Structured under the EBRD’s A/B loan scheme, the Bank is retaining PLN 100 million on its own account with the rest being syndicated to commercial banks. With a total cost of PLN 1.9 billion, the project is co-financed by EU Cohesion Funds and the European Investment Bank.
Reducing the city's carbon footprint
“The current low quality of service results mainly from very old trams, a limited number of low-floor trams (which affects the boarding and alighting times of passengers at tram stops) and a lack of modern traffic control at junctions,” explains Witek Szpak from the EBRD’s Municipal and Environmental Infrastructure team. “This investment should lead to the improvement of the quality and reliability of tram services, which should in turn persuade commuters to use the tram for an easier, quicker and greener commute.”
The introduction of new energy efficient trams that apply regenerative braking technology, a form of energy recovery mechanism which substantially reduces energy consumption, will also contribute to reducing emissions. “This new technology is not yet widely used by other tram operators in the country,” says Agnieszka Szymczyk from the EBRD’s Resident Office in Warsaw. “The successful introduction of this green technology is therefore expected to provide a positive demonstration effect.”
The project is part of Warsaw’s Sustainable Urban Transport Strategy, which aims to improve the quality of clean public transport services by a modal switch from private cars to public transport, thus reducing the city’s carbon footprint. Other efforts include the modernisation of the bus fleet and extension of the metro with the construction of a second line.
EBRD studies estimate that the switch from car to tram should lead to considerable reduction in CO2 emissions of 30,000 tonnes annually. Together with the other projects under the strategy the city could cut emissions by about 200,000 tonnes per annum according to initial calculations.
The majority of new tram cars are scheduled to be delivered between 2010 and 2012, when Warsaw will host the UEFA football championship. The very first tram, produced by Polish manufacturer PESA, was inaugurated in June by Hanna Gronkiewicz-Waltz, mayor of Warsaw and former vice president of the EBRD.
A new role model
The EBRD will try to help Polish authorities capitalise on these huge CO2 emission savings by developing a framework to monetise carbon emission reductions in urban transport via the sale of carbon credits. In order to do so, the Bank has attracted €35,000 in technical assistance funds from the Central European Initiative.
“Similar studies have already been undertaken in Latin America and Asia, but this would be the first time a European city tries to monetise emission reduction,” says Szpak. “When successfully verified, this methodology is expected to be applied in several urban transport projects in Poland as well as other countries in the region.”
The project is just one of a series of investments in energy efficient and sustainable transport planned throughout Poland in the next 2-3 years. Kraków and Warsaw are the most advanced with their investments but other cities such as Gdańsk, Poznań, Wrocław, Szczecin, Łódź or Lublin are contemplating replacements of the old trams or trolleybuses, sometimes with parallel extension of the lines.
“The current project with Warsaw Tramways is very much a pilot project with hopefully a positive demonstration effect,” says Szymczyk. “There is definitely potential for replication in other Polish cities who wish to invest in clean urban transport in the near future.”