The provision of a sovereign guaranteed loan of up to US$ 25 million to OJSC "Shabakahoi taksimoti bark" to finance development of advanced metering infrastructure and low- and medium-voltage grid enhancement in the cities of Dushanbe, Buston, Dangara, Panjakent, Konibodom, Isfara and Istaravshan in Tajikistan.
The Project's principal objectives are to: (i) address most urgent needs for the replacement of aged infrastructure, (ii) contribute towards the reduction of distribution network losses resulting in financial and CO2 emissions savings, and (iii) introduce modern billing and metering infrastructure, improve payment discipline and cash collection, supporting operational and financial efficiency and sustainability of the distribution sector.
- Resilient (primary): Under the Project, the Bank will continue to support regulatory reform in the energy sector with the overall purpose to introduce clear and transparent energy regulation in the country, ensuring the sustainable and market-based functioning of the energy sector of Tajikistan.
- Inclusive (secondary): The Project is expected to help address the key transition challenge of youth unemployment by creating dual learning opportunities, establishing more institutional routes for the school-to-work transition and delivering accredited certification of learning outcomes.
SHABAKAHOI TAKSIMOTI BARK OJSC
The sovereign guaranteed loan will be provided to OJSC "Shabakahoi taksimoti bark" established as part of Barqi Tojik unbundling.
EBRD Finance Summary
Total Project Cost
- Financing structure: Long-term financing for large infrastructure projects is currently unavailable from local commercial banks.
- Risk Mitigation, Policy and Regulatory Change and Knowledge, Innovation and Capacity Building: the Bank's technical and institutional expertise with the turnaround of utilities, policy dialogue work and TC.
- Standard-setting: helping projects and clients achieve higher standards: EBRD will introduce high standards beyond local requirements and practices on ESAP, procurement and gender mainstreaming activities.
Environmental and Social Summary
Categorised B (2014 ESP). The environmental and social impacts associated with the modernisation of the power distribution grid in seven large cities and their surroundings have been identified and will be managed by the implementation of an Environmental and Social Action Plan (ESAP), which has been agreed with the Client. The Bank's due diligence was carried out remotely by an independent consultant in accordance with ESD Covid19 guidelines; it included the review of an information package supplied by the client and information gathered during the Khatlon project.
The Project includes advanced metering infrastructure, low-voltage and medium-voltage enhancement. It is not subject to an environmental impact assessment under the legislation of Tajikistan or would be under the EU EIA Directive. An existing PIU (under BT) will help implement the Project. Support will be needed at the City Electricity Network Companies level (CENC). The ESAP includes overarching measures such as (i) the designation in each CENC of a person in charge of the implementation of the ESAP, (ii) the development and operation of an environmental and social management system, and (iii) the implementation of a stakeholder engagement plan.
The ESDD confirmed that the Project is structured to comply with the Bank's PRs and the Company has the institutional capacity to implement the Project with the help of the existing PIU, and with additional support through the implementation of the ESAP. Overall, the ESDD indicated that BT activities are currently driven by the obligation to comply with the applicable regulation of Tajikistan only. The main E&S risks are occupational health and safety (very poor practices observed on site), the demobilisation of the fee collectors (a retrenchment plan is required) and the stakeholder engagement associated with the introduction of new payment methods (advanced metering).
At BT level, the application of the labour code is done through a collective agreement that is specific to BT and covers all employees; it is accessible on BT intranet. BT has a formal workers' organization. The installation of advanced meters will result in a reduction of the work for fee collectors, and subsequently CENCs to reduce their staff because of the Project. The numbers of jobs to be cut (at least 10% of the number of workers in each establishment) is significant, and triggers the requirement for the preparation and implementation of a retrenchment plan in line with PR2 and EBRD template. The retrenchment plan will be prepared by the Company. It is estimated that 598 meter reader jobs will be cut, 125 of them are expected to be assigned other jobs within BT, and 473 would be definitely dismissed. The ESAP also requires the Company to develop and implement a non- discrimination, equal opportunity and sexual harassment policy.
The elimination of pollution sources within the premises of seven CENCs, essentially related to oil and oil waste management, as well as to the presence of asbestos, is also included in the ESAP. The annual reduction of GHG emissions due to the Project is estimated to 1,904 tCO2eq/year.
The Project includes the use of safer modern equipment (such as insulated cables), and the construction and operation will not generate any additional public health risks. As of today, the observations made on site showed a quasi-absence of adequate OHS measures on site. The Project implementation will be an opportunity to improve OHS conditions for BT workers, including an improvement of the OHS management system, the provision of the personal protection equipment and a refurbishment/reconstruction of the technical buildings (workshops, storages, substations facilities) in the seven CENCs. Before starting any construction activities, the contractor that will implement the project's construction/rehabilitation activities will have to prepare a Health, Safety and Environment Management Plan.
According to the Feasibility Study, no land acquisition or resettlement impacts are expected.
The ESAP includes measures to protect biodiversity at Project and Corporate level with measures to eliminate electrocution risks for birds, as some of the Project cities are located close to internationally recognized "Important Bird Areas" that host IUCN Red-listed bird species.
The primary objective of the Project is to reduce grid losses. These grid losses that will be reduced are of both technical and commercial origin. With the introduction of advanced metering and modernization of networks, the billing chain and the payment methods will change, and the disconnection of non-payers will be readily and remotely implemented. The overall change is expected to be positive for consumers, but there is a risk that some consumers will find it difficult to understand or adapt to the new system. The stakeholder engagement plan (SEP) that was prepared for the Project includes a commitment to disseminate information about the new system, and to implement a grievance mechanism. In addition, the ESAP requires a one-year transition period to be put in place, during which customers who have not paid their bill within the set 5 days limit will be contacted directly by the CENCs i with a main objective to identify vulnerable customers.
The ESAP also requires developing and implementing an environmental and social management system (ESMS) aligned to ISO14001 and ISO45001 standards at corporate level; and appointment of an EHSS manager at corporate level. The Bank will monitor implementation of the ESAP through review of Annual Environmental and Social Reports (AESR) and communications with the Company as necessary.
Technical Cooperation and Grant Financing
- Consultancy support for environmental due diligence of the Project to be financed by the SSF in the amount of EUR 20,000.
- Gender assessment to be financed by the SSF in the amount of up to EUR 75,000.
Company Contact Information
Shabakahoi taksimoti bark
PSD last updated
07 Dec 2020
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More information on the EBRD’s practices in this regard is set out in the ESP.
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Access to Information Policy (AIP)
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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).
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.
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