Provision of up to EUR 40 million-debt financing on sovereign basis to the state-owned utility company Public Enterprise Elektroprivreda, Serbia ("EPS") to support the first phase of roll-out of electricity smart meters in the Serbian distribution system.
Total project cost is estimated at EUR 80 million and EBRD's loan will be co-financed with the EIB (the "project").
The project will support the introduction of Advanced Metering Infrastructure ("AMI"), including modern meters together with related infrastructure, software, communications equipment, installation and integration systems. The roll-out of smart metering in Serbia will make a significant contribution to a wider grid modernisation programme aimied at the development of a smart grid and the reduction of technical and commercial losses as well as the better integration of distributed renewable generation sources in the system. Furthermore, the enhanced functionality of smart meters will improve demand side management and lead to more efficient energy consumption.
ETI score: 60
The transition impact arises from the Resilient and Green TI qualities. The introduction of AMI is expected to lead to a wide range of quantitative (financial) and qualitative benefits.
These include (i) a reduction in network losses, (ii) an increase in bill collection rates, (iii) savings on meter readings, (iv) optimised power usage and a reduction of peak power, (v) better detection of fraud and estimation of billing, and (vi) an improved environment for prosumers to engage with the Serbian power system.
Associated reductions in CO2 emissions is estimated to be approximately 5,000 tonnes per annum for the part of the project financed by EBRD.
JP EPS BEOGRAD
EPS is a vertically integrated power and mining utility, 100% owned by the Republic of Serbia. EPS operations comprise of electricity generation, management of the electricity distribution network throughout Serbia and supply of electricity consisting of more than 97% of total electricity supply in the country.
EBRD Finance Summary
Up to EUR 40 million sovereign guaranteed loan to be provided to EPS.
Total Project Cost
The EBRD is additional due to the financing structure provided. The Bank offers financing terms that are not available on the market but necessary to structure the project. The EBRD's financing fills the funding gap while also complementing funding from other sources including from the EIB.
Furthermore, through its best practice international procurement standards, the Bank will provide expertise that will strengthen the procurement capacity of the client.
Environmental and Social Summary
Categorised B (2019 ESP). The environmental and social impacts associated with the installation of smart meters are limited and can be readily managed. Due diligence for this Project was undertaken by the ESD specialist and included a review of the technical due diligence report and recent EPS environmental reporting provided for other projects.
The Project involves the installation of smart electricity meters, with the potential for coverage of up to 80% of households when the entire programme is fully implemented. The meters will reduce commercial and technical losses and help to improve the efficiency of electricity supply in Serbia. The first phase to be financed by EBRD is expected to result in a CO2 saving of around 5,000 tonnes per year, and the full programme could save around 68,000 tonnes per year. The installation and operation of the meters should not be associated with significant environmental or social impacts if managed in line with good practice. An ESAP will be agreed with the client requiring them to ensure that customers are aware of the installation programme, are contacted in good time and are able to have faults or grievances rectified quickly. The Bank will be providing TC support for consultants to help EPS in developing an awareness-raising plan and designing communications material. The ESAP will also require that contractors be competent in installing electrical equipment safely and that EPS develop a waste management plan for re-use, recycling or safe disposal of old equipment.
EPS is a long-standing client of the EBRD. The EBRD has provided support to help EPS with it stakeholder engagement, grievance management and occupation safety performance and there have been improvements in these areas. EPS is likely to remain a carbon-intensive energy provider for as long as it is dependent on an inefficient coal-fired generating fleet, but this investment in smart metering will make a meaningful contribution towards modernising the electricity sector in Serbia. The Bank will monitor the Project through environmental and social reports.
Technical Cooperation and Grant Financing
Total amount of EUR 135,000 TC was funded by the Bank's Shareholder Special Fund ("SSF") for the preparation of the update of the Feasibility Study of the Project and for the implementation of consumer awareness campaign in targeted towns in Serbia about the benefits of Smart Metering
Company Contact Information
PSD last updated
16 Sep 2020
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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).
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