Moldova Buildings Energy Efficiency

Location:

Moldova

Project number:

50601

Business sector:

Municipal and environmental infrastructure

Notice type:

State

Environmental category:

B

Approval date:

08 Dec 2021

Status:

Passed Final Review, Pending Approval

PSD disclosed:

15 Sep 2020

Project Description

A sovereign loan of up to EUR 30 million to the Republic of Moldova to finance energy and resource efficiency upgrades and rehabilitation of public buildings across the country (the "Project"). The financed measures will include but will not be limited to thermal insulation, associated structural works, replacement of doors and windows, installation of high-efficiency lighting and heating, cooling and ventilating upgrades including replacement of inefficient boilers, installation of thermostatic valves, renewable energy systems and energy management systems  as well as related energy audits, design and construction supervision.

Project Objectives

The Project aims to improve energy efficiency at the building level prioritising public buildings, both municipal and state-owned, across the country, which will result in significant environmental benefits through energy savings and reduction of carbon emissions.

Transition Impact

ETI score: 63

Transition Impact derives from (i) the Green quality through comprehensive EE investments in public buildings, aiming to achieve at least 30 per cent energy savings; and (ii) the Competitive quality by supporting the market development for buildings' EE through developing building energy performance criteria and providing for a transparent tendering process to attract the private sector expertise.

The Project is 100 per cent Green Economy Transition ("GET") compliant.

Client Information

MOLDOVA SOVEREIGN

Moldova sovereign. The Borrower is the Republic of Moldova, represented by the Ministry of Finance. The Project will be implemented by the Ministry of Infrastructure and Regional Development (MoIRD). A Project Implementation Unit (PIU) will be established based on the staff from the Moldovan Energy Efficiency Agency (EEA) and Moldova Energy Projects Implementation Unit ("MEPIU").

EBRD Finance Summary

EUR 30,000,000.00

A sovereign loan of up to EUR 30 million to the Republic of Moldova.

The EBRD Loan will consist of Tranche I of up to EUR 20 million and Tranche II of up to EUR 10 million.

 

Total Project Cost

EUR 72,400,000.00

The total capital expenditure is EUR 72.4 million. The EBRD loan will be co-financed by a EUR 30 million loan from the European Investment Bank ("EIB") and an investment grant of about EUR 12.4 million from the EU's Neighbourhood Investment Platform ("NIP").

Additionality

The additionality sources for the Project stem from:

- Financing structure;

- Standard-setting: helping projects and clients achieve higher standards.

Environmental and Social Summary

Categorised B (2019 Environmental and Social Policy). The Project will have significant benefits related to high quality EE measures, including improvement to building insulation and replacement of old heating sources, resulting in improved EE and reduced emissions in public buildings across the country. Environmental and social due diligence ("ESDD") was an audit carried out by an independent consultant and included a site visit to 18 buildings. The findings were that the client has some elements of environmental and social management in place and is generally in compliance with national legislation. The Environmental and Social Action Plan ("ESAP") has been prepared and has agreed with the client.

The Project consists of implementing EE, structural and comfort measures in circa 105 public buildings, both municipal and state owned. The EE measures will generate around 30 per cent annual energy savings, equivalent of 11,500 tonnes of CO2 emission avoided per year.

The Project will be implemented by a dedicated PIU, yet to be established by the Ministry of Infrastructure and Regional Development, comprising staff of EEA and MEPIU. The ESAP includes requirements in relation to Environmental and Social ("E&S") positions to be included within the dedicated PIU. The ESDD focused on the current operation of the EEA and the MEPIU. No Environmental, Health, Safety and Social ("EHSS") management systems are in place, but the necessary E&S processes are developed on a project-by-project basis. No National Environmental and Social Impact Assessment is required for the Project. For each building, a site-specific Construction Phase Environmental, Health, Safety and Social Management Plan ("CESMP") will be developed and implemented by the contractor, and approved by the PIU prior to start of construction. An Environmental and Social Management Plan has been developed during ESDD; it outlines the E&S mitigation measures to be followed during the construction phase of the Project and will be included in the construction contractors' contract. The responsibility for construction supervision rests with independent Supervising Engineers who will act on behalf of the PIU.

The Project also includes replacement of inefficient boilers; the ESAP requires the PIU and design engineer(s) to ensure that new boilers supplied are aligned to EU specifications on air emissions. The possible presence of Asbestos Containing Materials in the fabric of the buildings for refurbishment (dating back to the 1970s) cannot be discounted. Asbestos surveys will be conducted together with the Energy Audits in each Project building, and the implementation of an Asbestos Management Plan will be covenanted. The ESAP also requires the PIU to prepare an Occupational Health and Safety ("OHS") Policy, to be reflected in the contractors' OHS Plan. The thermal insulation of walls and roofs will be suitably fire-rated by the Supplier, as prescribed in national standards. The ESAP requires that the Design engineer submit a fire safety report to the PIU.

No land acquisition or permanent resettlement and/or economic displacement will be caused by the retrofitting of existing buildings. The PIU will support the building staff during the transitional period and ensure that more disruptive construction works are carried out during suitable times of day and seasons, both for the benefit of building users and nearby businesses. The ESDD found that HR related arrangements mostly align with all PR2 requirements; the ESAP requires the PIU to develop a Project-specific Labour Management Plan ("LMP") compliant with national labour legislation, EBRD PR2. Each contractor must also comply with the Project-specific LMP as part of their contract. All contractor workers will be required to sign a Code of Conduct that will include specific behavioural requirements, including forbidding any gender-based violence and harassment. No retrenchment will be caused by the Project activities. A Stakeholder Engagement Plan ("SEP") has been developed during the ESDD. Both EEA and MEPIU maintain their own official webpage (on which the SEP and Non-Technical Summary were published), and an online grievance mechanism is already in place.

A number of protected buildings and trees could be affected by the construction works under the Project. The design engineer(s) should submit a report, alongside the designs, stating which (if any) buildings and trees are protected under the national legislation. Should selected buildings be on the list of protected buildings of Moldova, contractors working on these buildings will gain the necessary approval and permits from the relevant national Authority and apply associated mitigation measures, as confirmed in the ESAP.

The Bank will monitor the Project through annual environmental and social reports provided by the client, and site visits if necessary.

Technical Cooperation and Grant Financing

Pre-signing:

  • Environmental and social due diligence.

Company Contact Information

Constantin BOROSAN, State Secretary for Energy; Ministry of Infrastructure and Regional Development
constantin.borosan@midr.gov.md
+373 22 250 600
www.midr.gov.md
Piata Marii Adunari Nationale 1, MD-2033, Chisinau, Republic of Moldova

PSD last updated

18 Nov 2021

Understanding Transition

Further information regarding the EBRD’s approach to measuring transition impact is available here.

Business opportunities

For business opportunities or procurement, contact the client company.

For business opportunities with EBRD (not related to procurement) contact:

Tel: +44 20 7338 7168
Email: projectenquiries@ebrd.com

For state-sector projects, visit EBRD Procurement:

Tel: +44 20 7338 6794
Email: procurement@ebrd.com

General enquiries

Specific enquiries can be made using the EBRD Enquiries form.

Environmental and Social Policy (ESP)

The ESP and the associated Performance Requirements (PRs) set out the ways in which the EBRD implements its commitment to promoting “environmentally sound and sustainable development”.  The ESP and the PRs include specific provisions for clients to comply with the applicable requirements of national laws on public information and consultation as well as to establish a grievance mechanism to receive and facilitate resolution of stakeholders’ concerns and grievances, in particular, about environmental and social performance of the client and the project. Proportionate to the nature and scale of a project’s environmental and social risks and impacts, the EBRD additionally requires its clients to disclose information, as appropriate, about the risks and impacts arising from projects or to undertake meaningful consultation with stakeholders and consider and respond to their feedback.

More information on the EBRD’s practices in this regard is set out in the ESP.

Integrity and Compliance

The EBRD's Office of the Chief Compliance Officer (OCCO) promotes good governance and ensures that the highest standards of integrity are applied to all activities of the Bank in accordance with international best practice. Integrity due diligence is conducted on all Bank clients to ensure that projects do not present unacceptable integrity or reputational risks to the Bank. The Bank believes that identifying and resolving issues at the project assessment approval stages is the most effective means of ensuring the integrity of Bank transactions. OCCO plays a key role in these protective efforts, and also helps to monitor integrity risks in projects post-investment.

OCCO is also responsible for investigating allegations of fraud, corruption and misconduct in EBRD-financed projects. Anyone, both within or outside the Bank, who suspects fraud or corruption should submit a written report to the Chief Compliance Officer by email to compliance@ebrd.com. All matters reported will be handled by OCCO for follow-up. All reports, including anonymous ones, will be reviewed. Reports can be made in any language of the Bank or of the Bank's countries of operation. The information provided must be made in good faith.

Access to Information Policy (AIP)

The AIP sets out how the EBRD discloses information and consults with its stakeholders so as to promote better awareness and understanding of its strategies, policies and operations following its entry into force on 1 January 2020. Please visit the Access to Information Policy page to find out what information is available from the EBRD website.

Specific requests for information can be made using the EBRD Enquiries form.

Independent Project Accountability Mechanism (IPAM)

If efforts to address environmental, social or public disclosure concerns with the Client or the Bank are unsuccessful (e.g. through the Client’s Project-level grievance mechanism or through direct engagement with Bank management), individuals and organisations may seek to address their concerns through the EBRD’s Independent Project Accountability Mechanism (IPAM).

IPAM independently reviews Project issues that are believed to have caused (or to be likely to cause) harm. The purpose of the Mechanism is: to support dialogue between Project stakeholders to resolve environmental, social and public disclosure issues; to determine whether the Bank has complied with its Environmental and Social Policy or Project-specific provisions of its Access to Information Policy; and where applicable, to address any existing non-compliance with these policies, while preventing future non-compliance by the Bank.

Please visit the Independent Project Accountability Mechanism webpage to find out more about IPAM and its mandate; how to submit a Request for review; or contact IPAM  via email ipam@ebrd.com to get guidance and more information on IPAM and how to submit a request.

 

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