Slovak Republic

Project number:


Business sector:

Power and energy

Notice type:


Environmental category:


Approval date:

18 Mar 2003



PSD disclosed:

27 Sep 2002

Project Description

Proposed equity investment of up to  66 million in ZSE in partnership with E.ON Energie AG. E.ON Energie are the winning bidder of an international competitive tender for a 49% stake in ZSE sold by the National Property Fund of Slovakia (FNM).
Project objectives: To enhance the privatisation process contributing to political risk mitigation, a transparent privatisation process as well as regulatory risk mitigation in an evolving electricity market.

Transition Impact

The Bank's participation supports the sector's liberalisation and privatisation process in Slovakia in line with the Bank’s Energy Policy and the Country Strategy for Slovakia. The government is actively moving to introduce private participation in the energy sector and the sale of a 49% stake in ZSE is a significant milestone. Privatisation of distribution is part of the Government's overall strategy for sector restructuring, aimed at increasing efficiency of the sector and meeting conditions for EU-accession. The impetus of the privatisation has led the regulator to issue clear foundations and formulae for the establishment of transparent cost recovery tariffs for the distribution sector. The introduction of experienced strategic investors to the sector should lead to increased efficiencies in the system.

The Client

Zapadoslovenska energetika, a.s. (ZSE), the western Slovakian electricity distribution company. It has 965,000 customers and is the largest Slovak distribution company.

EBRD Finance

Up to  66 million equity investment.

Project Cost


Environmental Impact

The project was screened C/1 requiring an Environmental Audit.
Slovak legislation moves to consistency with international legislation. The environmental legislation affecting the company includes four main acts: Air, Water, Waste disposal and Nature Protection Acts. The company expects to invest around US$ 12 million in environmental improvements by 2006.
An Environmental Audit was carried out by independent consultants who concluded that:
  • There are no significant environmental issues associated with ZSE'es current operations
  • There are no significant environmental liabilities associated with past operations or with ZSE's facilities
  • ZSE is in compliance with relevant national and EU legal requirements
  • ZSE's current environmental management system (close to certification under ISO 14000) is functioning successfully; the company is considered to be amongst a leader in environmental management.
  • The occupational, health and safety policy and management system and practises are functioning well; there was no incidence of non compliance with legal requirements over the past five years.
  • ZSE is planning to carry out significant environmental investments in the period up to the year 2005, mainly aimed to improve transformer stations. Planned investments exceed legal national and EU requirements.
  • Given the company's environmental and health and safety performance and taking the planned investments into account there is no need for an Environmental Action Plan.

Technical Cooperation

180, 000 funded by the UK and USTDA for legal due diligence and advisory work.

Company Contact


Business opportunities

For business opportunities or procurement, contact the client company.

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