SWIFT Dolj sub-project

Location:

Romania

Project number:

50802

Business sector:

Municipal and environmental infrastructure

Notice type:

Public

Environmental category:

B

Approval date:

01 Oct 2019

Status:

Signed

PSD disclosed:

23 Sep 2019

Translated version of this PSD: Romanian

Project Description

Loan of up to EUR 25 million RON equivalent to Compania de Apa Oltenia SA (CAO), a regional water operator in the Romanian counties of Dolj and Gorj.

The proceeds of the loan will be used to co-finance, alongside EU Cohesion Funds, an extension and modernisation of the company's water and wastewater infrastructure and services. The EU investment grants are being made available under the EU Large Infrastructure Operational Programme.

Project Objectives

The project aims to enable CAO and the counties of Dolj and Gorj to bring their water and wastewater services in line with EU environmental standards by co-financing the extension and rehabilitation of the company's water and wastewater network alongside the EU.

Transition Impact

Good.

The project is proposed for financing under the Sustainable Water Infrastructure Facility Framework (SWIFT). In line with SWIFT, the transition impact of the project will be achieved through:

  • The development of a long term asset management approach and the involvement of the private sector in reducing the company's non-revenue water.
     
  • The support of environmental improvements and continued regionalisation of water and wastewater services in the counties of Dolj and Gorj.

Client Information

WATER COMPANY OF OLTENIA

Compania de Apa Oltenia SA
https://www.apaoltenia.ro/

EBRD Finance Summary

EUR 25,000,000.00

RON equivalent

Total Project Cost

EUR 374,615,604.00

Environmental and Social Summary

Categorised B (EBRD's E&S Policy 2014).  The Environmental and Social Due Diligence (ESDD) for the project under the "Sustainable Water Infrastructure Facility" (SWIFT) was carried out as part of the Project Feasibility Study by independent consultants and included a review of environmental and social management capacity and performance of S.C. Compania de Apa Oltenia S.A (CAO) and an assessment of the project's potential environmental and social (E&S) impacts. 

The ESDD established that the company's existing integrated E&S management systems are well developed and are certified to ISO14001/2015 and OHSAS18001 to be replaced by ISO45001.  The company's Human Resources systems are in line with the requirements of the EBRD's Performance Requirement 2.

The project was subject to a single Environmental Impact Assessment (EIA) screening procedure. A competent authority issued the screening decision that no EIA was required due to the project being unlikely to have a significant impact and this will be local, short-term and relate chiefly to the construction period. A limited part of the project will be conducted within or in close proximity to Natura 2000 sites (ROSCI0045, ROSPA0023, ROSCI0288, ROSPA0154, ROSCI0039 and ROSPA0013, ROSCI0129, ROSPA0074 and ROSCI0299). A full-scale appropriate assessment has not been required by the competent authority. Measures for the protection of the Natura 2000 sites are included in the various environmental approvals and plans for the project. It is assessed that the project is in full compliance with Directive 79/409/EEC on the protection of wild birds and Directive 92/43/EEC on the conservation of natural habitats and of wild fauna and flora. Relevant authorities have issued their endorsements for the works inside and nearby the sites in their capacity as managers of the sites.  Overall, the project is assessed to have a positive impact on the Natura 2000 sites through the reduction of unplanned wastewater discharges into aquatic ecosystems.  The ESDD has concluded that the environmental impacts of the project have been assessed in full compliance with the new EU EIA Directive.

CAO currently supplies potable water for 390 thousand people and wastewater treatment services for 244 thousand people. With the project an additional 120,000 people will be connected to the water supply and wastewater collection system.  Upgrades to existing infrastructure will reduce leakages by the order of 3.2 million m3 per year. The project will bring the company operations into compliance with the service provision obligations of the EU Directive no. 98/83/EC on the quality of drinking water and Directive no. 91/271/EEC on wastewater collection and treatment by 2021. The project will include a Sludge Management Strategy based on an in-depth option analysis resulting in 70 per cent of the wastewater treatment sludge being re-used in agriculture, and 30per cent in land improvement which is in compliance with the Directive as transposed into national legislation.

For the investment subcomponent 'Rehabilitation and extension of the water supply pipeline Izvarna-Craiova II', the land needed for the water supply pipeline will be subject to expropriation in areas where land is not public, to ensure the minimum safety zone of 25 meters distance from the pipeline, along the 221 km pipeline. The land is free of settlements or any constructions, but some is used for agriculture. The route, technical details and potential impacts were made public through the EIA Screening procedure as well as through the publication of the FS in the approval process from each administrative unit. No comments or complaints were received from landowners or potential owners of land during the approval process, which is now completed. After the pipeline has been rehabilitated, the land owners can continue to use their land, except for the 25 meters safety zone. The expropriation process has started; the lists of affected landowners have been made public and they are yet to receive personal official notices on the expropriation decision and will have the opportunity to further participate in the mediation meetings. The expropriation process includes compensation at full replacement value for all owners, in accordance with the legal procedure. Mediation and access to justice are granted in the legal expropriation procedure compliant with EU standards and legal requirements.  There will be no involuntary resettlement of formal settlements related to project activities.

Other adverse environmental and social impacts of the project, which can be mitigated by good construction practices will be of a short-term nature and relate to the construction stage and localised within construction sites. These impacts include noise generated by equipment, local short-term increases in traffic intensity and corresponding air pollution, and soil and landscape disturbances during excavation works.  The ESAP includes provisions for Environment, Health and Safety (EHS) management of contractors and for monitoring and reporting by the client. The Environmental and Social Action Plan (ESAP) also requires contractors to implement biodiversity management plans for Natura 2000 locations.

A Stakeholder Engagement Plan (SEP) has been agreed for project implementation that includes a public grievance mechanism.  The project and implementation of the SEP and ESAP will be monitored through annual reports provided by the client.

Technical Cooperation

The EBRD will mobilise funds from donors to support technical cooperation.

The Project benefited from pre-signing assignments included under SWIFT: technical and procurement review, environmental and social gap analysis, operational and financial due diligence of CAO, legal and institutional due diligence on regionalisation. The amount of these assignments was EUR 87,000 and has been financed by the Bank's Infrastructure Project Preparation Facility.

In addition, the Project will benefit from the following post-signing assignment under SWIFT:

  • Operational and regulatory support to prepare a corporate asset management plan; review options for cost-efficiency improvements; promote private sector involvement; and review the current Delegation Contract to ensure that appropriate regulatory arrangements are in place to facilitate the sustainability of the proposed investments


The estimated amount for that assignment is EUR 50,000 and is proposed to be financed from the EU Structural Instruments, and from the Bank's Shareholders' Special Fund.

For consultant opportunities for projects financed by technical cooperation funds, visit EBRD Procurement: Consultancy Services at http://www.ebrd.com/work-with-us/procurement/consultancyservices.html

Company Contact Information

Compania de Apa Oltenia
https://www.apaoltenia.ro/

Business opportunities

For business opportunities or procurement, contact the client company.

For state-sector projects, visit EBRD Procurement: Tel: +44 20 7338 6794
Email: procurement@ebrd.com

General enquiries

EBRD project enquiries not related to procurement:
Tel: +44 20 7338 7168
Email: projectenquiries@ebrd.com

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