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Ukraine: Poltava District Heating Project – Corporate Development Support Programme

Procurement ref:




Business sector:

Municipal and environmental infrastructure

Funding source:

Sida-EBRD Ukraine Energy Efficiency and Environment Consultant Cooperation Fund.

Contract type:

Consultancy Services

Notice type:

Invitation for expressions of interest (CSU)

Issue date:

09 Jan 2015

Closing date:

29 Jan 2015   at  23:59   Poltava

Assignment Description: 
The district heating (“DH”) company Poltava Oblast Communal District Heating Enterprise “Poltavateploenergo” (the “Company” or “PTE”), a communal district heating utility wholly-owned by the Poltava Oblast (the “Oblast”), has approached the EBRD requesting a loan to support its energy efficiency priority investment programme (“PIP”) in the DH infrastructure.
The City of Poltava (“Poltava” or the “City”) is the administrative centre of the Oblast. Poltava is one of the wealthier cities in Ukraine due to its relatively diversified and extensive industrial base that spans across oil and gas, manufacturing and the food processing sectors.  The oil and gas sector is particularly important as close to 20 per cent of Ukrainian domestic oil production and 40 per cent of Ukrainian natural gas production is concentrated in the Poltava oblast.
The Company operates in the Oblast (covering several towns and villages with a total population of 40 thousand) and the City with a population of about 300 thousand. The Company operates heat generating capacities and networks in the City and is the major distributor of district heating services, supplying heat and hot water to approximately 1300 residential apartment buildings in the City or 95 per cent of the connected City population.
The objectives of the priority investments are in line with the long-term strategy for Poltava DH system and focus on significantly improving energy efficiency, reducing energy losses, gas and electricity consumption and improving the quality of heat and hot water supply services in the City, thereby helping the Company to retain its customer base. The PIP is expected to result in significant efficiency improvements along with energy (corresponding to a reduction of gas consumption by 30 per cent in the Project area) and water savings as a consequence of customer controlled heat supply, improved efficiency of generation and distribution and reduced losses in the distribution network.
As part of the Project, the Company will need to improve its corporate governance and financial and operational performance, maintain financial ratios and other covenants, establish two-tier tariffs based on actual heat consumption and ensure that tariffs are reviewed periodically in order to ensure full cost recovery. The Company will also sign a Public Service Agreement with the City, which will clarify the responsibilities of the City, the Company and the customers regarding the provision of heating services.
The overall objective of this assignment is to improve the commercial standing of the Company and enable it to implement the Project, as well as ensure that the services are equitably provided to the end-consumers and are of a high quality. Specific objectives are to assist the Company to, inter alia:
  • identify, discuss with the Company and with the City, and implement the necessary corporate, financial and operational improvements to meet the related covenants included in the EBRD finance documents. This will be achieved via the development and implementation of a Financial and Operational Performance Improvement Programme (“FOPIP”) which will include development and implementation of Tariff Setting Guidelines;
  • develop, negotiate with the City and adopt a Public Service Contract (“PSC”);
  • develop and implement a medium to long term Corporate Development Plan (“CDP”) and corporate planning process, so it may continue its transition towards an entirely commercial entity;
  • analyse the impact of planned tariff increases on the end-consumers, with a particular focus on vulnerable groups, and develop guidelines for the municipality for the mitigation of any negative impacts;
  • develop and implement policies which promote equal opportunities and non-discrimination;
  • develop alternative fuel strategy for the Company and analyse alternative fuel supply sources; and
  • assist the Company in preparation of tariff filings.
Status of Selection Process: Interested firms or group of firms are hereby invited to submit expressions of interest.
Assignment Start Date and Duration: The assignment is expected to start in Q1 2015 and has an estimated overall duration of 24 months.
Maximum Budget available for the Assignment: EUR 200,000 (exclusive of VAT).
The Consultant must determine whether any indirect taxes/VAT are chargeable on the proposed services and state the basis for such. If any indirect taxes/VAT are payable, the Client will have to pay indirect taxes/VAT element to the services directly to the Consultant unless otherwise agreed.
Funding Source: Sida-EBRD Ukraine Energy Efficiency and Environment Consultant Cooperation Fund.
Eligibility: No restrictions.
Consultant Profile: Corporate services are required. The selected consultant (the “Consultant”) will be a firm or a group of firms with extensive project experience in district heating engineering and service provision.
The Consultant’s team should consist of at least the following key experts:
  • Team Leader/District Heating Expert;
  • District Heating Institutional and Regulatory Expert;
  • Financial Specialist;
  • Environmental and Social Specialist;
  • Legal Expert;
  • Local Experts (including, inter alia, an expert with experience in local tariff regulation in the DH sector).
The key experts shall have an extensive experience and expertise enabling them to successfully perform their respective tasks during the assignment. The Local Experts shall  be fluent in Russian or Ukrainian. 
Submission Requirements: In order to determine the capability and experience of consultants seeking to be selected, the information submitted shall include the following:
(a) brief overview of the firm/group of firms including company profile, organisation and staffing;
(b) details of similar experience of firm or group of firms and related assignments undertaken in the previous five years, including information on contract value, contracting entity/client, project location/country, duration (mm/yy to mm/yy), expert months provided, assignment budget, percentage carried out by consultant in case of association of firms or subcontracting, main activities, objectives;
(c) CVs of key experts who could carry out the Assignment detailing qualifications, experience in similar assignments, particularly assignments undertaken in the previous five years, including information on contracting entity/client, project location/country, duration (mm/yy to mm/yy), expert months provided, assignment budget, main activities, objectives.
(d) Completed Consultant Declaration and Contact Sheet, the template for which is available from the following web-link:
Failure to provide the duly completed and signed Consultant Declaration may result in the applicant being disqualified from the selection process.
The expression of interest shall not exceed 20 pages (excluding CVs and contact sheet).
One original and two copies of the expression of interest, each original/copy in (a) English and (b) Ukrainian or Russian, shall be submitted to the Client in an envelope marked “EXPRESSION OF INTEREST for Poltava District Heating Project – Corporate Development Support Programme”, to reach the Client not later than the above referenced closing date and time. The expression of interest shall also be submitted by e-mail to the Client’s contact person indicated below by the same closing date and time.
In addition, the expression of interest shall be submitted by e-mail to the EBRD’s contact person indicated below by the same closing date and time.
The complete expression of interest (including CVs, Consultant Declaration and Contact Sheet) must be submitted in one file (pdf or Word). The EBRD and the Client reserve the right to reject the expressions of interest submitted in more than one file. Only if the permissible size is exceeded, the applicant may split the expression of interest into further files.
Executing Agency (Client):
Poltava Oblast Communal District Heating Enterprise “Poltavateploenergo”
The Client Contact Person:
Alexander Oleksenko 
Deputy Director
Poltava Oblast Communal District Heating Enterprise “Poltavateploenergo”
Poltava, 36008 Ukraine, Komarova 2-A
Phone: +380532510404
Fax: +380532510402
The EBRD Contact Person:
Marina Matushina
Technical Cooperation
European Bank for Reconstruction and Development
One Exchange Square
London EC2A 2JN
Tel: + 44 20 7338 6577
Fax: +44 20 7338 7451
Important Notes:
1. The selection will normally be made from responses to this notification only. Consultants will not be asked to submit proposals. The highest-ranked Consultant will be selected from a shortlist and will be invited to negotiate the contract, subject to availability of funding.
2. Shortlisting criteria and respective weightings are:
  1. Firm’s experience in similar assignments, preferably in the district heating sector  - 35%;
  2. Firm’s experience of working in the region - 15%;
  3. Key experts’ experience relevant to their respective tasks - 50%.
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