GrCF2 W2 Medias Infrastructure Loan

Location:

Romania

Project number:

52456

Business sector:

Municipal and environmental infrastructure

Notice type:

State

Environmental category:

B

Approval date:

08 Sep 2021

Status:

Approved

PSD disclosed:

29 Jun 2021

Project Description

A senior loan of up to EUR 7.7 million in local currency (RON 38 million) to the City of Medias to co-finance critical investments in the City's infrastructure alongside EU grants under the relevant EU Regional Operational Programme for 2014-2020. The loan proceeds will fund the implementation of energy efficiency measures in four public buildings and in urban roads (including bridges), as well as help modernise, rehabilitate and extend the City's electric public transport infrastructure.

Project Objectives

The Project is designed to promote energy savings and to reduce  of CO2 emissions in public buildings and to improve urban mobility. This will be achieved through energy-efficient rehabilitation of a pool of public buildings (schools, multi-functional and educational centre and social i medical centre) that includes insulation, LED lighting to replace incandescent bulbs, improved utility connection (water, sewerage, electricity, gas), indoor rehabilitation of electrical, plumbing, heating and ventilation installations and other works. In addition, the Project will improve the City's trolleybus network by acquiring three trolleybuses, improving facilities at bus stops, improving the e-ticketing system and rehabilitating the City's electric transport infrastructure. The City's priority investment programme also includes rehabilitation of several local city streets (including provision of LED lighting and safe pedestrian sidewalks and modernisation of underlying utility networks for sewerage).

Transition Impact

ETI score: 70

ETI 70

The Green Cities Framework II (GrCF2) represents a strategic and multi-project approach seeking to help identify and address environmental challenges in selected large cities in our countries of operation. The primary goal is to achieve significant environmental improvements and to promote the Green transition quality within the relevant cities. In addition to the environmental objective, the GrCF2 also promotes sustainable cities through inclusive, resilient, well-governed and smart urban development. Depending on which area can generate the strongest and most relevant transition impact, either Well-governed, Inclusive, Resilient or Competitive will be pursued and presented as the secondary transition quality for each sub-project under the framework. These transition objectives are supported by the development and implementation of a city-specific Green City Action Plan (GCAP) aiming to identify environmental challenges, facilitate better coordination and buy-in among stakeholders and help to prioritise and develop the best ways to address the environmental challenges through targeted investments, services and policy instruments.

The Project will primarily help to promote the Green transition quality by bringing significant energy and CO2 savings to the City's buildings and urban transport fleet. It is expected that the Project will achieve a total CO2 eq. emissions reduction of 4,760 tonnes/year (saving 22% of the current use), and energy savings of 2,050 GJ/year (29% saving). In addition, the Project will benefit the City's entire population of over 56,400 inhabitants, as the City's transport network extends across the city and is widely used by its residents

The Project will also support the Resilient objective through the introduction of long term asset management practices and crisis resilience planning in the municipal system, so as to ensure continuity of public services and sustainability of public infrastructure.

Client Information

CITY OF MEDIAS

 Primaria Medias

primaria@primariamedias.ro

 

0745.108.036

0269.841.198

http://www.primariamedias.ro

Piata Corneliu Coposu nr.3, cod 551017 Medias, jud. Sibiu

EBRD Finance Summary

RON 38,000,000.00

Total Project Cost

RON 138,406,400.00

Additionality

The Bank is additional because of its:

  • Terms: The Bank will provide necessary long-term financing for energy efficiency measures in public infrastructure. Due to the existing market inefficiencies, such financing is not readily available from commercial banks.
  • EBRD attributes: EBRD's extensive energy efficiency knowledge and long-standing relationship (including policy dialogue) with the City and ability, through the Green Cities Action Plan process, to pursue the green agenda and gender and inclusion considerations.

Environmental and Social Summary

Categorised B (ESP 2019). The Project involves continued support to EU-funded projects of energy efficiency improvements in urban infrastructure through an existing client, the City of Medias. Their past E&S reporting and ESAP implementation under the Medias Urban Infrastructure Rehabilitation project was satisfactory. The new project is part of a broader programme aiming to improve the City's sustainability and serves as a trigger project under EBRD Green Cities that will support the development of a Green City Action Plan (GCAP) for Medias.

The City's priority investment programme includes co-financing of several priority investments already approved under the EU Regional Operational Programme. This involves rehabilitation of several local city streets (including provision of LED lighting and safe pedestrian sidewalks and modernisation of underlying utility networks for sewerage), rehabilitation and modernization of several public buildings (including thermal insulation and LED lighting), and modernisation and extension of electric public transport infrastructure. The E&S risks and impacts associated with all components of the proposed project will be temporary and mostly construction-related, site-specific, easily assessed and manageable through relevant mitigation measures in the contract requirements.

Environmental and Social Due Diligence (ESDD) for the new project was undertaken in line with the ESD ESDD response to COVID 19, initially through ESDD questionnaire and review of the EU Grant applications and other available documentation, which was thereafter supplemented by the project due diligence exercise from the independent consultant. ESDD confirmed that the project would not involve any land acquisition, involuntary resettlement or significant economic displacement. The project will not affect any sensitive locations, protected areas or cultural heritage sites. Most of the rehabilitation works will be taking place along the already existing roads. For the construction phase of the street rehabilitation works in the historical city centre, a chance finds procedure will be adopted and implemented by the contractors.

The proposed EU-EBRD investments have already undergone the corresponding screening procedure by the competent environmental authority Environmental Protection Agency (EPA) Medias in line with the EU EIA Directive requirements, and it concluded that no EIA is required for the project components. EPA has imposed some additional measures for carrying out the works and taking additional precautions in the respective permitting documents. Project impacts on soil, water bodies and biodiversity from construction have been assessed to be not significant.

The City of Medias has an established environmental policy and procedures, which are part of its existing Quality Management System. The City will further ensure that there is an integrated Environmental and Social Management System (ESMS) in place in line with the best international practice, including ISO 14001 for environmental, ISO 45001 for occupational health and safety, and ISO 39001 for road traffic safety management. This requirement is included in the project ESAP. The City's HR policies and procedures for their workforce fully comply with PR2 requirements related to labour and working conditions, including the national laws, international labour standards and gender equality. Majority of employees are women, including many in management positions. Staff are represented by own trade union that is proactively handling any health and safety, labour and working conditions issues and grievances. The collective work agreement covers all contractual direct employees, and the staff grievance mechanism is adequate.

The Project will provide GHG emissions reduction by 4,760 t/year of CO2 equivalent due to significant energy savings and improved energy efficiency of the public buildings and rehabilitation of electric transport infrastructure. Other air emission reduction will include NOx by 3.5 t/year and PM by 24 kg/year.

The City has developed overall occupational health and safety (OHS) procedures and work instructions which are monitored to assess OHS performance in relation to national legal requirements. Adequate OHS requirements will be included within the tenders and contract packages, and the contractor must develop site-specific safety plans upon contract award. The contractors will follow adequate management of hazardous materials and wastes, including asbestos waste management procedures. Contractor management plans will also include electrical safety, earthworks and trench safety procedures among others. Traffic management procedures and road safety requirements will also be included with the tenders and contract packages. The City will supervise and monitor the OHS performance of the works contractors. The City already has emergency plans in place, including for fire, flooding, storms and heavy snowfall, and these emergency plans will be further updated to cover project investments.

ESAP includes further requirements for the City to pay attention to further gender-specific inclusion opportunities, road safety management and COVID 19 crisis related response plans including labour, worker and community health and safety issues and stakeholder engagement. Adequate ESAP provisions included for management of E&S issues during construction works. Contractors will be required to develop and implement project-specific Construction EHSS management plans, asbestos management plans and provisions for building rehabilitation, adequate waste management, noise/vibration and dust mitigation procedures for all works. Site-Specific H&S Plans are also developed and subject to approval and supervision by the City's H&S manager.

Stakeholder Engagement Plan (SEP) including a grievance mechanism has been prepared for implementation during the project. The City publishes all information on its website regarding the City's activities with particular emphasis on the status of implementing ongoing projects, including information regarding environmental, social and safety aspects. Grievance mechanism for external stakeholders is deemed adequate.

Company will provide the Bank with annual environmental and social reports, including updates on the implementation of the ESAP. The Bank may also conduct monitoring visits, as required.

Technical Cooperation and Grant Financing

Pre-signing TC: EUR 74,900 for technical, economic and environmental due diligence;

Post-signing TC: EUR 275,000 for GCAP preparation;

Non-TC: None.

The two TC assignments are non-reimbursable transactional TCs, required to assist the City in its project preparation and implementation.

Company Contact Information

Primaria Medias
primaria@primariamedias.ro
0745.108.036
0269.841.198
http://www.primariamedias.ro
Piata Corneliu Coposu nr.3, cod 551017 Medias, jud. Sibiu

PSD last updated

29 Jun 2021

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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