Highway Tolling

Location:

North Macedonia

Project number:

50769

Business sector:

Transport

Notice type:

Public

Environmental category:

B

Target board date:

05 Jun 2019

Status:

Signed

PSD disclosed:

15 Feb 2019

Translated version of this PSD: Macedonian

Project Description

Provision of a sovereign-guaranteed loan to Public Enterprise for State Roads (PESR) to finance the improvement and modernisation of the existing toll system on Corridor VIII as well as the installation of new electronic toll stations on new highway sections that are being built in FYR Macedonia.

The Project is a follow-on operation of the previous Bank's project for the construction and upgrade of eight toll stations along Corridor X, including installation of electronic toll collection ("ETC") equipment that is currently under implementation.

The EBRD's financing will be used for the following:

(i) Upgrade and modernization of five toll stations on the FYR Macedonia's Corridor VIII as well as construction of three new toll stations to operate with the ETC system;

(ii) Installation of equipment to link the upgraded and new toll stations to the toll operations centre in Skopje;

(iii) Construction of an additional lane to increase the capacity of the Miladinovci toll stations on Corridor VIII;

(iv) Installation of solar panels on all 15 existing and new toll stations.

Project Objectives

Support the operation of a unified and fully interoperable toll system on the motorway network of FYR Macedonia, which will improve the current situation which consists of two different toll systems with different user interfaces.

Promote green economy through the generation of renewable energy from photo voltaic solar panels to be installed on all 15 existing and new toll stations which is estimated to provide around 45 per cent of the electrical power consumed by these toll stations and reduce PESR's electricity costs.

Transition Impact

Moderate Good

The Project will support resilience of the motorway sector through the increase of toll revenue ensuring sustainable funding and enhancement of operational efficiency of the motorway networks in the country.

In line with the Green Economy Transition (GET) approach, the Project will promote green economy through the generation of renewable energy by photovoltaic solar panels on the toll stations on the highway network in the country.

Client Information

PUBLIC ENTERPRISE FOR STATE ROADS
The client and the borrower is PESR. The Guarantor is FYR Macedonia.

EBRD Finance Summary

EUR 13,000,000.00

A sovereign-guaranteed loan of up to EUR 13 million.

Total Project Cost

EUR 14,400,000.00

Environmental and Social Summary

Categorised B (2014 ESP). The loan to Public Enterprise for State Roads (PESR) of N. Macedonia will be used for (i) the upgrade and modernisation of existing toll stations on Corridor VIII as well as the construction of three toll stations on new highway sections that are being built in N. Macedonia; (ii) the installation of equipment to link the upgraded and new toll stations to the toll operation centre in Skopje; (iii) the construction of an additional lane to increase the capacity of the Miladinovci toll station on Corridor VIII; and (iv) the installation of photo voltaic solar panels on all the existing and new toll stations that are being built on the entire motorway network in the country (the Project). The Project is expected to provide E&S benefits that include establishing a single, more efficient tolling system thus improving connectivity and use of renewable energy sources.

Environmental and social due diligence (ESDD) was carried out by an independent consultant and included a site visit, interviews with relevant PESR personnel and an E&S assessment of the Project and audit of PESR’s operations against Performance Requirements (PRs). An Environmental and Social Action Plan (ESAP) has been prepared to address the identified gaps and structure the Project in line with PRs. A Non-Technical Summary (NTS) covering all components of the Project, Stakeholder Engagement Plan (SEP) and Land Acquisition Framework (LAF) have been prepared and will be disclosed on the Client website.

PESR does not currently have a corporate E&S and OHS policy, formal E&S and OHS management system nor management plans and procedure documents. A Corporate EHSS ESAP (agreed in 2014 between PESR & EBRD) has been developed as part of the National Roads Project. The ESAP includes a specific action aimed at developing a clear and usable set of internal policies and guidance to cover identification, appraisal and management of key E&S and OHS risks. PESR is now working on its implementation with EBRD appointed TC consultants.

The national requirements for environmental assessment and permitting for the construction and reconstruction of tolling stations have been met through the provision of EIAs for the respective motorway sections on Corridors VIII and X. In addition the project component that relates to construction of an additional lane to increase the capacity of the toll station Miladinovci is expected to undergo the national environmental assessment and permitting procedure soon. No material issues are expected to be raised. PESR will also be required to obtain relevant permits for the instalment and operation of solar panels.

The Project will implement pollution prevention and control measures in line with national and EU standards. Six TS are located along the borders of several significant biodiversity areas, and two TS are in an IBA and one of them is also in an Emerald site, and an appropriate assessment has not been conducted as part of national environmental assessment. Therefore, an additional biodiversity survey will be conducted by an independent expert prior to construction to establish whether any priority biodiversity features may be at risk from the Project, and to determine and provide additional site specific measures and a Biodiversity Management Plan if necessary.

For the additional lane needed for the Miladinovci TS, it will be necessary  to acquire approx. 0.04 ha of land along the existing motorway corridor which is predominantly agricultural and or pasture, but not used. A LARF has been developed in line with EBRD PR 5 requirements and will be disclosed. The land acquisition process for this component is not progressed enough to develop a Land Acquisition Plan, so this needs to be prepared ahead of actual implementation of the construction activities for the Project. The Project will also require some temporary land take for construction laydown areas, temporary storage of excavated materials, cut trees and these will be agreed by Contractors through negotiation and amicable agreement with land owners.

The ESAP includes requirements to prepare Environmental and Social Management Plans for construction and operation and will include defined requirements for monitoring, near-water works, waste management, spoil disposal, borrow sites, spill response and groundwater protection, traffic management and community and OHS safety; development of a project grievance mechanism; development of a chance-finds procedure; and monitoring of contractors’ labour performance.
 
The Bank will evaluate the Project's environmental and social performance in accordance with the Bank's PRs through review of reports and monitoring visits as required.  ESD to sign off on Board document prior to submission.

Technical Cooperation

The Project will be complemented by a Technical Cooperation ("TC") assignment for project implementation support and works supervision.tation.

Company Contact Information

Misko Arsov, Project Documentation Preparation and monitoring Adviser
arsovm@roads.org.mk
+389 (0) 2 3118-044
+389 (0) 2 3220-535
www.roads.org.mk
Dame Gruev 14 1000 Skopje

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