C2CF Porec water and wastewater sub-project

Project number:

45770

PSD disclosed:

06 Aug 2014

Translated version of this PSD: Croatian

Project Description

The Bank is contemplating an additional senior loan of up to EUR 6 million to Odvodnja Porec d.o.o., a municipal company based in the City of Porec, providing wastewater collection and treatment services in the City of Porec and in the surrounding municipalities.

Project Objectives

The additional financing will enable the completion of C2CF Porec water and wastewater sub-project, approved by the Board in November 2015, which consisted of a EUR 4 million EBRD loan alongside EU structural funds for an investment to fund (i) the extension and reconstruction of the wastewater network and (ii) construction of 4 new wastewater treatment facilities, as well as a sludge treatment facility in the Porec area.

Transition Impact

The main transition objectives remain focused on (i) the support for efficiency gains and enhanced capacity of the water utility; (ii) contribution to improved productivity at the sector level. In addition, the loan increase was confirmed as Green Economy Transition - eligible, with the expected 3.2 million m3/yr wastewater treated.

The Client

Odvodnja Porec d.o.o. is a municipal company, based in Porec, Croatia, responsible for providing wastewater collection and treatment services in the City of Porec and surrounding municipalities.

EBRD Finance

EUR 10,000,000

EUR 6 million senior loan, complementing the Bank's existing EUR 4 million loan approved by the Board in 2015.

Project Cost

 EUR  58,960,624

Investment programme for (i) the extension and reconstruction of the sewage network and (ii) the construction of 4 new wastewater treatment facilities, as well as a sludge treatment facility in the Porec area.

Environmental Impact

Categorised B (2014 ESP). The Loan increase will not involve new investment components or material changes to the original project which was approved under 2008 ESP as part of the C2CF framework and is jointly funded by the Bank and the EU. The Loan covers the reduction of the EU funding from 73% to 62% of overall investment cost, to ensure timely and successful implementation of the Project.

The existing wastewater collection and treatment facilities are characterised by outdated equipment, high water losses and low wastewater collection network connection. Total capacity of the 4 wastewater treatment plants included in the project is 137,500 PE. The WWTPs will provide tertiary treatment of wastewater in line with the EU requirements and the project is also in line with the EU Water Framework Directive due to improving overall water management system and reducing pollution of the Adriatic by bringing the effluent standard discharges to the level designed for sensitive waters. As a result of this project, connection rate to improved wastewater services will increase from 67% to 93%.

The E&S due diligence for the loan increase was carried out by the Bank's environmental and social specialists and consisted of a site visit and meetings with the Company, as well as a review of the latest Project Implementation Progress Report, annual E&S reporting and ESAP implementation progress. The project is currently under construction at 4 WWTP sites and at the sludge drying and composting site and is overall implemented well. However, the Company needs to improve site supervision for better public safety and occupational health and safety at the construction sites. Further mitigation measures are required to ensure the Project complies with the Bank's PRs, and the ESAP has been updated to include a stronger emphasis on H&S aspects during construction, including better contractor management and further guidance on construction site safety best practices, permanent presence of site security personnel on project sites, improving temporary materials storage areas, and exercising more rigorous and frequent site health and safety audits to prevent accidents. Furthermore, the Company will need to update their SEP including external grievance mechanism. The Bank will monitor the implementation of the Project and the ESAP by reviewing their annual environmental and social reports and undertaking monitoring visits as needed.

Technical Cooperation

None.

Company Contact Information

info@odvodnjaporec.hr
+38552431003
+38575805698
odvodnjaporec.hr
Mlinska 1, 52440, Porec, Croatia

 

 

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