EPBiH Gracanica SPP

Overview
Project Summary Document
Environmental and Social Documentation
Procurement
Complaints

Overview

EBRD secured senior loan of EUR 25.1 million to public electricity generation utility JP Elektroprivreda Bosne i Hercegovine d.d. Sarajevo ("EPBiH" or the "Company") for the development, construction, and operation of two adjacent solar photovoltaic plants (50 MWp in total) located at Gracanica, Municipality of Bugojno, on top of a rehabilitated mine site previously used for coal exploitation (the "Project"). The total loan will be sized to cover the estimated EUR 38.5 million capex of the project as well as the costs of lenders' advisors and is co-financed by EBRD and Unicredit Bank d.d. via a parallel loan.

Project ID 53198

Status Signed

Location

Bosnia and Herzegovina

Business Sector

Energy

Notice Type

State

Project timeline

Exploratory
Passed Concept Review
Passed Structure Review
Passed Final Review
Board Approved
Signed
Implementing
Completed

Company Contact Information

Nadzida Hamza
n.hamza@epbih.ba
+38733751035
+38733751033
www.epbih.ba
Vilsonovo setaliste 15, 71000 Sarajevo, Bosnia and Herzegovina

Project ID 53198

Status Signed

Location

Bosnia and Herzegovina

Business Sector

Energy

Notice Type

State

Environmental Category

Approval Date

24 Jul 2024

Disclosure date

01 Feb 2023

EPBiH Gracanica SPP (Bosnian) (PDF, 0.23MB)

Project description

Project objectives

This will be one of the first solar power projects to be developed by EPBiH as the Company shifts towards renewable energy investments as part of its decarbonisation agenda. The Project would significantly add to EPBiH's renewable energy portfolio (excluding large hydro power plants) and also create opportunities for employment in Bosnian regions heavily reliant on coal mining during construction. The Project is expected to reduce total greenhouse gas ("GHG") emissions by 60,600 tons of CO2 per annum in addition to providing increased electricity generation for summer peaks and greater availability of water for climate change adaptation. This will assist the country in its low-carbon transition and commitment to the goal of the Paris Alignment.

Transition impact

ETI Score:73

ject's transition impact is based on the Green TI quality as the Project will add up to 0.3% of yearly national electricity generation to the Bosnia and Herzegovina power system.

Client information

JP ELEKTROPRIVREDA BIH DD

JP ELEKTROPRIVREDA BIH DD EPBiH is a public electricity generation utility company serving around 50 per cent of the population of Bosnia and Herzegovina. The Company generates around 20 per cent of its electricity production from large hydro power plants and the rest from thermal power plants. The Company is a Joint Stock Company listed on the Sarajevo Stock Exchange (SASE), majority owned and controlled by the Federation of Bosnia and Hercegovina (90 per cent).

EBRD Finance Summary

EUR 25,100,000.00

Additionality

The Bank is providing a non-sovereign corporate financing structure not typically available from local banks on reasonable terms and conditions for projects of this nature. The project also mobilises commercial funding provided by a commercial co-lender on a parallel loan basis. Additionally, EBRD has a breadth of experience investing in solar power plant projects and can offer the Company expertise and knowledge in this area.

Environmental & Social Summary

Categorised B (Environmental and Social Policy, 2019). Due diligence confirmed that the environmental and social (E&S) impacts associated with two mid-sized, adjacent solar photo voltaic (PV) plants in brownfield, heavily modified areas are site specific and can be readily mitigated through the implementation of a targeted E&S action plan. Independent Environmental and Social Due Diligence (ESDD) has been undertaken on the Project and an Environmental and Social Action Plan (ESAP) has been developed and agreed with the Client.

The E&S risks and impacts of the project are to a large extent mitigated by the site selection, utilising a brownfield site within a former lignite mine provides rehabilitation and beneficial re-use of this currently unused land. ESDD was supplemented with a land quality assessment, supported by the Bank, which indicated low potential for the presence of pre-existing contamination and no associated remedial work prior to construction is required. The site is located in close proximity to an existing sub-station with only a short cable connection required.

The project represents the opportunity to demonstrate the effectiveness of a new type of renewable energy by the public electricity generation utility and will assist with further diversifying the energy mix in the country which is currently dependent on non-renewable sources. Successful implementation of this project could mean it becomes one of several more PV plants to be developed as part of mine closure and rehabilitation, delivering renewable energy at the location of a former carbon intensive energy producer.

The ESDD focused on reviewing the Client's E&S institutional capacity and management systems to ensure the Project's compliance with EBRD Performance Requirements (PR), supported the site selection and also included analysis of specific environmental and social issues. No site specific sensitivities, environmental or social, have been identified on site which is consistent with expectations considering its former use. Visual impacts are not considered to be significant due to the existing modified nature of the landscape and distance to nearest residential receptors. The project has prepared an EIA Elaborate report in accordance with national legislation which has been approved by the Ministry of Environment and Physical Planning.

The Client will need to establish a team to implement the Project, including specialist environmental and social resources and further develop their Environmental and Social Management System including an environmental and social management plan, community and employee grievance mechanisms. Relevant construction phase mitigations, including those related to occupational and community health and safety will need to be included in the Engineering Procurement and Construction (EPC) contract and their implementation monitored by the Client.

As a public sector project the Management Approach to Solar Supply Chain has been implemented which includes adherence to EBRD's public procurement rules (PPR) which stipulate that the supplier of solar PV panels, unknown at the time of the project approval, will be required to provide full traceability of a supply chain map and auditability rights of the supply chain in the event that the intended manufacturing facilities are located in areas of high risk. This is consistent with previous public sector solar projects and allows sufficient safeguarding to mitigate the worst forms of forced labour in the solar supply chain. These requirements between the borrower and the supplier are also reflected in the financing agreement between the bank and the borrower.

To ensure compliance with the Bank's PRs and to address the gaps identified at the ESDD, the ESAP has been agreed with the Client. A non-technical summary (NTS) and a stakeholder engagement plan (SEP) have also been prepared by the independent consultant and have been disclosed by EBRD as part of the Project Summary Document. The documents can be assessed via the following links:

https://www.epbih.ba/stranica/okolina#projekti-i-javnost

https://www.epbih.ba/eng/page/environment#projects-your-voice.

The Bank will monitor the implementation of the Project via annual E&S reports review and monitoring site visits as required.

Technical Cooperation and Grant Financing

The Bank has mobilized EUR 720k of non-reimbursable technical assistance funds from Austrian Municipal Infrastructure Fund to assist with a comprehensive feasibility study covering the development of PV plants at two potential project sites, as well as with project implementation, including the preparation of technical specifications and tender dossiers, assisting the client tender evaluation and the signing of contracts.

The Bank has also mobilized EUR 450k of non-reimbursable technical assistance from the Austrian High Impact Partnership on Climate Action ("HIPCA") for the development and implementation of the "Decarbonisation Assessment and 2050 Decarbonisation Plan." This plan will support EPBiH to enhance its corporate planning capacity and governance to implement and operationalise a decarbonisation plan aligned with the Paris Agreement.

The Bank has mobilized EUR 250,000 of non-reimbursable funds via HIPCA and its own Special Shareholder Funds for EPBIH to hire an Owner's Engineer/Supervision Engineer to ensure the successful implementation of the Project.

A further EUR 75,000 assignment funded by HIPCA will be launched to help support the Company during the implementation of its strategic workforce management activities as well as to commence a policy dialogue engagement with the Ministries of Education of BiH for the introduction of new education standard(s).

Company Contact Information

Nadzida Hamza
n.hamza@epbih.ba
+38733751035
+38733751033
www.epbih.ba
Vilsonovo setaliste 15, 71000 Sarajevo, Bosnia and Herzegovina

Implementation summary

PSD last updated

14 Aug 2024

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 the 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 its associated Environmental and Social Requirements (ESRs) set out the ways in which the EBRD implements its commitment to promoting “environmentally sound and sustainable development”. The ESP and the ESRs include specific provisions for clients to comply with the applicable requirements of national laws on public information and consultation, and to establish a grievance mechanism to receive and facilitate resolution of stakeholders’ concerns and grievances, in particular, about the environmental and social (E&S) 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 also requires its clients to disclose information, as appropriate, about the risks and impacts of 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 of the Bank's activities 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 EBRD believes that identifying and resolving issues in the project assessment and approval stages is the most effective means of ensuring the integrity of Bank transactions. OCCO plays a key role in these protective efforts andhelps to monitor integrity risks in projects post-investment.

OCCO is further responsible for investigating allegations of fraud, corruption and misconduct in EBRD-financed projects. Anyone, either 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. OCCO will follow-up all matters reported. It will review all matters reported. 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, which entered into force on 1 January 2025, sets out how the EBRD discloses information and consults with its stakeholders to promote better awareness and understanding of its strategies, policies and operations. 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 (for example, 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 the 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 and how to submit a Request for review. Alternatively, contact IPAM by email at ipam@ebrd.com for guidance and more information on IPAM and how to submit a request.

Environmental and Social Documentation is not available for this project.

Selected procurement notices related to this project may be shown below. Further procurement opportunities related to this and other projects, if available, maybe be viewed in the EBRD Procurement Portal.

The EBRD's Environmental and Social Policy (ESP), Access to Information policy (AIP) and Project Accountability Policy (PAP) enable sound and sustainable development in its projects. The Independent Project Accountability Mechanism (IPAM) deals with complaints about environmental, social and disclosure matters related to the Bank’s investments.

No complaints about this project have been made so far.

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EPBiH Gracanica SPP

Overview

Project timeline

Company Contact Information

Project description

Project objectives

Transition impact

Client information

EBRD Finance Summary

Additionality

Environmental & Social Summary

Technical Cooperation and Grant Financing

Company Contact Information

Implementation summary

PSD last updated

Understanding transition

Business opportunities

General enquiries

Environmental and Social Policy (ESP)

Integrity and compliance

Access to Information Policy (AIP)

Independent Project Accountability Mechanism (IPAM)