ESIF: Stara Zagora Water Subproject

Location:

Bulgaria

Project number:

51100

Business sector:

Municipal and environmental infrastructure

Notice type:

Public

Environmental category:

B

Approval date:

21 Jul 2020

Status:

Approved

PSD disclosed:

29 Jul 2019

Project Description

Provision of a loan of up to EUR 7 million to Stara Zagora Water Supply and Sanitation Company ("Company"), a water utility serving the region of Stara Zagora. The Company is 100 per cent stateowned through the Ministry of Regional Development and Public Works.

The loan will be funded by EBRD capital resources and the European Structural and Investment Funds and the national budget of the Republic of Bulgaria (jointly referred as "ESIF contributions").

The ESIF contributions are earmarked to be used in the form of repayable financial instruments.

The proceeds of the loan will finance the rehabilitation of the water supply system and wastewater collection infrastructure serving the region of Stara Zagora, jointly with investment grants from the EU
"Operational Programme Environment" 2014-2020 (the "Project").

Project Objectives

The main objectives of the Project are: (a) to help the Company achieve compliance with the EU Urban Waste Water Treatment Directive in all agglomerations of more than 10,000 people serviced by the Company and (b) to improve the efficiency of water supply services, reduce the share of nonrevenue water and fulfil the requirements of the EU Drinking Water Directive.

Transition Impact

Good

The Transition Impact stems from the Project's strong environmental benefits (reducing water losses, connecting more people to centralised sewage and waste water treatment, and introducing wastewater treatment in compliance with EU Directives), the reduced dependence on full grantbased financing of investments as well as the strengthening of the Company's financial and operational performance through technical cooperation (TC).

Client Information

WATER AND SEWAGE COMPANY OF THECITY OF STARA ZAGORA

Stara Zagora Water Supply and Sanitation Company is a state-owned utility that provides water and sanitation services to 12 municipalities in the region of Stara Zagora with approximately 300 thousand inhabitants.

EBRD Finance Summary

EUR 4,100,000.00

The loan will amount to EUR 7 million, of which EUR 4.1 million will be funded by EBRD's ordinary capital resources (the "EBRD Tranche") and EUR 2.9 million in ESIF contributions from the EBRDEU Special Fund (the "ESIF Tranche").

The ESIF financial resources are being managed by the Bank and the Fund Manager of Financial Instruments in Bulgaria ("FMFIB") signed in October 2018.

Total Project Cost

EUR 50,500,000.00

The total project costs will be majority-financed with EU investment grants and co-financed with the proceeds of the loan.

Environmental and Social Summary

The Project is categorised B in accordance with the 2014 Environmental and Social Policy. The key environmental and social ("E&S") risks and impacts will be mainly construction related: particularly health and safety of workers and public during excavation activities; temporary restrictions of access; increased noise, dust and vibration levels; and contractor management. The environmental and social due diligence will be undertaken by TC funded consultants and will include a review of compliance with national legislation, EU standards, including the drinking water directive, and the Bank's PRs. It will also review the potential for permanent or temporary resettlement and appropriate mitigation.

Depending on the results of E&S due diligence and resulting recommended mitigation measures the EBRD may need to agree additional requirements with Stara Zagora WSSO. A Non-Technical Summary (NTS), Stakeholder Engagement Plan (SEP) and ESAP will be developed.

This section will be revised with the results of the environmental and social due diligence.

Technical Cooperation

EBRD has envisaged the following donor-financed technical cooperation (TC) for the Project and the Company:

  • TC that cover the following activities: (1) technical and operational review of the Project; (2) analysis of the key contractual arrangements; (3) financial modelling and analysis; (4) environmental and social due diligence and gap analysis; (5) procurement review and (6) and Green Economy Transition ("GET") confirmation. This TC will be funded by EBRD's Sustainable Infrastructure Advisory.
     
  • TC for preparation of a diagnostic analysis of the Company and development of a financial and operational performance improvement programme aimed to strengthen the Company's operations and improve its long-term creditworthiness. This TC will be potentially financed with funding from the Operational Programme Environment 2014-2020.

Company Contact Information

Rumen Ralkov
secretary@wik-stz.com
00359 42 651 345
00359 42 651 345
http://wik-stz.com/bg/
62 Hristo Botev Street 6000 Stara Zagora

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

Public Information Policy (PIP)

The PIP 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. Please visit the Public Information Policy page below to find out how to request a Public Sector Board Report.
Text of the PIP

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 how to submit a Request for review through our confidential online form, by email, mail or telephone. IPAM is available to discuss your concerns and answer any questions you may have about the submission or handling of Requests, which follow the Project Accountability Policy and Guidance. Requestors’ identities may be kept confidential, upon request.

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