The Bank is considering providing a loan of up to € 11.1 million to the City of Burgas as part of the Bank’s co-financing of the City’s Integrated Urban Transport Project, It is expected to be jointly funded with EU grant under Operating Programme ‘Regional Development’ on a blended basis. The project’s total cost amount to € 67 million of which up to € 47 million will be provided by the EU Cohesion Fund on a grant basis. The project components to include:
- Construction of a 15 km Bus Rapid Transit (BRT) corridor – a new segregated bus lane corridor will be constructed with robust road sub-base techniques to handle high-frequency bus services. This corridor will provide quick, reliable travel for users, essentially replicating an urban LRT service but at reduced cost. A new bus route network will be also introduced to complement the BRT service.
- Associated traffic management and public transport prioritisation to meet the needs for the BRT corridor - To enhance the reliability of the services and provide users improved quality, a series of investments will be made in traffic management techniques along the corridor, with real-time passenger information systems at BRT stops and in-vehicle systems, and fleet management systems.
- Bus depot extension, bus shelters and new multi-modal Central Bus Station and Bus Terminal construction –The new services will be accompanied by bus terminal designed to link passengers to other public transport services, including regular bus services and rail. These investments also include new bus shelters and depot improvements, for both urban and inter-city services. The investment in the depot expansion is necessitated by the City’s decision to introduce larger buses (CNG and diesel) to operate over the enhanced infrastructure, based around the BRT concept.
- New CNG and clean diesel fleet acquisition – This will involve the introduction of some 60 new CNG and diesel buses to operate over the improved infrastructure. The new vehicles will replace Burgas Bus’ oldest buses and will contribute to a greatly improved and reliable service, with reduced emissions as well as reduced maintenance costs and more attractive public transport. The new vehicles will be a mix of standard (12 metre) and articulated (18 metre) buses, which will be operated over the new BRT segregated corridor.
- CNG bus service infrastructure – The investment will focus on the construction of a new CNG filling station to serve the expanded CNG bus fleet. This will be located at the Burgas Bus facilities, and will be an expansion of the current CNG filling station already in use.
- Integrated ticketing system – The new system will allow users to make seamless transfers from all major modes of public parking.
- Non-motorised transport – This will involve key investments in a cycling network and pedestrian facilities to improve safety. As an important component contributing to urban sustainability, the cycling paths will be designed to allow both residents and tourists to circulate conveniently and safely throughout the downtown and beach areas of Burgas.
The physical investments will be supported by extensive project management from the EU Cohesion Funds, as well as Bank-funded TC grants.
It is expected to achieve the following transition impact:
Improved contractual framework for markets through introduction of a long term Public Service Contract. The new multi-year contractual arrangement between the City and the operators will establish sound and transparent relationship which will enable a solid framework for service delivery and regulation of a key public service, and will facilitate improved service quality, corporate development and will help achieving cost efficiency over time. Burgas will be one of the first cites in Bulgaria to implement a PSC which follows the guidance of the EU Regulation 1370/2007, which came into effect on December 2009. The PSC approach ensures a long-term sound and transparent contractual relationship which:
- allows introducing sustainable business conditions for operator, by setting the initial service volume, level of standard and rate per service unit
- makes the operator creditworthy and enables long-term financing;
- creates natural incentives for a city to increase tariffs on regular basis and for an operator to seek cost efficiency, thus reducing any public support levels;
- establishes improved sector regulation, whereby the City is able to hold the operator accountable for delivering a high-quality service in exchange for public support payments paid for operating low-volume routes and transporting any passengers at discounted rates due to social policy.
- Although the revision of the PSC is partially driven by EU requirements, the Bank will support the City which wishes to contract its ‘internal’ (i.e. municipal) operator, Burgas Bus.
BRT demonstration leading to fuel consumption savings and emissions reductions: Replacement of the obsolete and inefficient rolling stock with the new, clean diesel and CNG buses will produce significant fuel savings, as well as lowering emissions due to cleaner engine technology and greater efficiencies. According to the Project’s Feasibility Study prepared by JASPERS, replacement of the old rolling stock itself should result in a reduction of 50 per cent for CO2, and 90 per cent for NOx, NMHC and PM10. In addition, the higher commercial operating speeds on the BRT corridor will allow for a 15-20 per cent reduction in fleet sizes, thus saving even greater fuel consumption. Finally, the development of BRT will demonstrate the benefits of this high-capacity, yet relatively low-cost solution in the Bank’s countries of operations, and should produce a moderate modal shifts from private cars to public transport, thus reducing emissions even further.
The City of Burgas.
Loan of up to € 11.1 million.
€ 67 million.
The project has been categorised B in accordance with EBRD's 2008 Environmental and Social Policy. The priority investments are expected to provide significant improvements to quality, safety, accessibility and energy efficiency of public transport system, contribute to improve ambient air quality and pedestrian safety in the City of Burgas, as well as promote environment-friendly and sustainable modes of transport. The project has been subject to Initial Environmental and Social Examination, which showed that the potential adverse future environmental and social impacts have been assessed as part of EIA screening procedure, concluding that the proposed investments are not likely to have significant adverse impacts, providing that appropriate mitigation measures are/will be implemented.
The due diligence includes a corporate review of the Client's current environmental and social management systems, the past and current performance against EBRD's Performance Requirements (PRs), and environmental and social analysis of any potential environmental and social impacts and benefits of the priority investment programme. The due diligence also includes a review of the reports prepared by the JASPERS consultants as part of the project preparation for EU Cohesion Fund financing.
An Environmental and Social Action Plan will be prepared and agreed with the Company to address any environmental and social issues identified during the due diligence to achieve and maintain compliance with the Bank's PRs within a reasonable time-frame. The Client will also develop a Stakeholder Engagement Plan, including a grievance mechanism. This PSD will be updated when the results of due diligence are known.
For business opportunities or procurement, contact the client company.
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