Intro Sustainable Resources

Location:

Egypt

Project number:

51369

Business sector:

Energy

Notice type:

Private

Environmental category:

B

Approval date:

09 Mar 2022

Status:

Signed

PSD disclosed:

23 Nov 2021

As permitted by paragraph 2.6 of Section III of the Access to Information Policy, disclosure of this PSD was deferred in accordance with paragraph 1.4.4 of the Directive on Access to Information.

Project Description

Provision of a senior secured loan of up to USD 4,830,000 to Intro Sustainable Resources & Intro Solar S.A.E. (the "Borrowers") to finance a pipeline of green projects the most advanced of which includes the expansion of a plastic bottle recycling facility, replacing an inefficient diesel steam energy generation with combined heat and power plant ("CHP"), and refinancing a solar project developed under round 1 of the Egyptian Feed-in-tariff ("FiT") program (the "Projects").

Project Objectives

The Projects will support: i) the company's expansion of resource recovery facilities; ii) its ambitions to expand its long-term low-carbon energy transition strategy; and iii) the expansion of private-to-private utility projects in Egypt.

Transition Impact

ETI score: 66

The Transition Impact arises from the Green and Inclusive qualities:

Green - The Projects entail the financing of green projects, specifically the production capacity expansion of a plastic bottle recycling facility, the replacement of inefficient diesel steam energy generation units for a food-processing company with a best-of-class industrial use CHP plant, the refinancing of the solar project, and other investments. Excluding the refinancing, other components of the project will result in GHG emissions savings and higher energy efficiency. The preliminary Green Economy Transition ("GET") share of the use of proceeds is 93% with the potential to increase following add-on investments.

Competitive i The Projects will be developed on a private to private basis, which will increase the role of private developers in an electricity market that to date is largely dominated and catered to by the public sector. The recycled PET facility will demonstrate how private sector driven industrial waste recycling projects can be economically viable.

Client Information

INTRO SUSTAINABLE RESOURCES

Intro Sustainable Resource was recently established in 2020 to develop alternative energy, energy efficiency, waste management, RDF, material recovery and recycling projects via two fully owned subsidiaries: (i) Intro Power & Utilities, and (ii) Intro Waste Management and Material Recovery. Intro Sustainable Resources is ultimately 100% owned by Intro Investments Holding Ltd.

Intro Solar is an Egyptian-domiciled SPV operating a 5 MW solar PV plant developed under round 1 of the FiT program. Intro Solar is currently 75% owned by the Abbas family through their 100% owned entity, Intro Storage LLP.

EBRD Finance Summary

USD 4,830,000.00

Total Project Cost

USD 9,100,000.00

Additionality

Financing structure - USD financing from commercial banks is limited in Egypt and EBRD offers financing that is not available in the market from commercial sources on reasonable terms and conditions.

Environmental and Social Summary

Categorised B (2014 ESP).  The Bank's confirmed use of proceeds, refinancing an existing 5MW PV plant, a small scale gas fired CHP plant at a commercial food production facility and the installation of equipment to increase the capacity of a plastic bottle recycling plant, are expected to result in reduced and avoided GHG emissions and a reduction in plastic waste through recycling. A future pipeline of projects, which includes renewable energy (RE), electricity distribution, alternative energy applications and waste management projects are further expected to reduce GHG emissions. Despite the benefits of these projects, the development and operation thereof may be associated with various E&S impacts, although these have been assessed to be limited and readily managed through mitigation measures. An Environmental and Social Action Plan ("ESAP") has been developed and will be agreed with the Company before Board.

E&S due diligence (ESDD) was conducted by a consultant with support from ESD and included a review of Company E&S management provisions and capacity, existing Company assets as well as potential E&S risks associated with individual projects, both defined and future projects. The ESDD also included the development of a procedure for the Company to guide the identification and assessment of impacts and the management, monitoring and reporting of future projects in line with EBRD's E&S requirements. Future projects are expected to be category B and will require sign off by EBRD. While E&S provisions have been included in projects developed to date, the Company will be required to formalise its own E&S management system and cascade this down to individual projects. This will include the need for adequate E&S resources, contractor E&S requirements, management plans, procedures and monitoring provisions. The procedure developed as part of the ESDD will complement the management system. Further provisions will be required to consider and mitigate risks in supply chains, specifically potential forced labour risks in future solar PV projects

E&S impacts associated with the use of proceeds are assessed to be limited as these will take place within the boundaries of existing commercial sites and will have a limited footprint. Projects will be required to undergo appropriate E&S assessments and permitting where required. HR provisions comply with national labour law and are generally aligned with PR2 requirements although the Company will need to develop a formal HR policy and grievance mechanism and apply such provisions to contractors. The CHP plant will be required to meet the emission limits of the EU Medium Combustion Plant directive.  Provisions will be put in place to manage potential issues associated with water use and waste generation.  Further provisions are required to ensure potential H&S risks associated with the projects are suitably assessed and managed including risks to workers, off takers and communities.  This will include fire and building safety and emergency preparedness and response planning. The ESDD included consideration of potential risks at existing projects, and existing and planned off takers, and the ESAP includes actions for the Company address such risks, and liaise with off takers where necessary. These include health and safety and waste management, including waste supply chains, risks. No land acquisition, biodiversity or cultural heritage issues have been identified.  Future projects may be associated with such issues and these will need to be considered as part of the respective assessments. A stakeholder engagement framework has been developed for the project as has a Non-Technical Summary (to be disclosed with the PSD). The framework will serve as the basis for project specific Stakeholder Engagement Plans (SEPs) to ensure information disclosure, stakeholder engagement and a grievance mechanism.

Technical Cooperation and Grant Financing

N/A

Company Contact Information

Omar El Maarry
omar.elmaarry@introgroup.org
+201003472944
2 Wadi El Nile st., Mohandiseen, Giza, Egypt

PSD last updated

17 Feb 2022

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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