A senior loan of up to EUR 25 million to the Communal Enterprise "Dniprovska Municipalna Energoservisna Kompanya", the municipal energy management company, owned by the city of Dnipro. The loan is expected to be co-financed by up to EUR 5.5 million investment grant from the Eastern Europe Energy Efficiency and Environment Partnership (E5P), subject to grant approval by the E5P Assembly of Contributors. The local contribution of up to EUR 2.5 million will cover additional energy conservation measures and capital repairs.
The project proceeds will finance a pipeline of works contracts with elements of an Energy Performance Contract (EnPC") for energy efficiency investments in 98 public buildings, including 67 kindergartens, 27 schools and 4 outpatient clinics.
The loan will be a sub-project under the Public Sector Energy Efficiency Financing Framework, consisting of municipal-guaranteed loans to municipal energy management companies in Ukraine to facilitate critical improvements in energy efficiency measures in public buildings in a number of cities across Ukraine.
The proposed investment will enable the city to finance energy efficiency measures through EnPCs implemented by private contractors selected by competitive tender. The investments are expected to result in strong improvement of buildings' condition through renovation of facilities and meeting heating requirements, improved comfort level and reliability of services at kindergartens, schools and clinics, as well as reduction of energy and maintenance costs of the buildings and decrease of CO2 emissions.
ETI score: 64
Green through support of energy savings and reduction of CO2 emissions and support of further development of Ukraine's ESCO market through an EnPC and associated policy dialogue and legal reform.
Competitive through enabling the involvement of private sector resources to design and implement energy saving projects taking part of the risk of achieving energy savings.
ENERGY EFFICIENCY COMPANY OF THE CITY OF DNIPRO
Communal Enterprise Dniprovska Municipalna Energoservisna Kompanya is the municipal energy management company, which develops, tenders and finances EnPC sub-projects on behalf of the city.
EBRD Finance Summary
A senior loan to the company of up to EUR 25 million to be provided in euro.
Loan maturity: Up to 13 years, including up to 3 years grace, with 20 equal semi-annual repayments.
The loan will be secured by a full municipal guarantee from the city.
Total Project Cost
EBRD loan to be complemented by up to EUR 5.5 million of investment grant and the local contribution of up to EUR 2.5 million.
Terms: The market for long-term borrowing for municipal energy efficiency projects in Ukraine is very limited; local bond and loan markets offer short maturities, other IFI facilities require sovereign backing.
Attributes: The Bank is uniquely positioned for the dialogue with the government and the local authorities aimed at improvement of legal and business environment for increasing private sector participation.
Conditionalities: EBRD conditionalities significantly exceed commercial banks' requirements.
Environmental and Social Summary
Categorised B (2019 ESP). Environmental and social due diligence (ESDD) of the proposed investment was undertaken by independent consultants as part of a feasibility study. The ESDD showed that the energy efficiency measures including insulation of internal and external walls, roofs and basements, installation of new windows, ventilation systems and LED lighting, lagging of heating pipes and the introduction of automated temperature controls will bring substantial environmental and social benefits. The ESDD confirmed that the project is structured to meet the EBRD's Performance Requirements (PRs) and that the city has the institutional capacity to implement in compliance with the Bank's PRs and with national legislation. ESDD also concluded that any adverse environmental and social impacts of the project will be site-specific, mainly restricted to the construction phase. These include occupational health and safety risks, waste management and temporary loss of access to parts of public buildings, and they will be addressed through appropriate mitigation measures.
An Environmental and Social Action Plan (ESAP) has been developed and agreed with the client. ESAP includes requirements to appoint environmental and safety managers and develop Environmental, Health and Safety (EHS) and waste management plans. Information on sub-projects will be disclosed at sites and online and will include grievances mechanism. For buildings where asbestos is identified, an asbestos management plan will be developed and implemented as part of the project. Monitoring of the project and ESAP implementation will be carried out via annual environmental and social reports provided by the client.
Technical Cooperation and Grant Financing
Feasibility study covering technical, environmental and social due diligence of the company and the city.
Project implementation support to the company and the city to prepare and procure EnPCs, monitor implementation of energy efficiency measures and verify achievement of guaranteed energy savings.
Company Contact Information
Golovakha Tymur Anatoliiovych
+380 56 778 63 17
75 Dmytra Iavornytskogo Avenue Dnipro, 49000, Ukraine
PSD last updated
06 Oct 2020
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Independent Project Accountability Mechanism (IPAM)
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