KAZREF - Zheruyik Wind Power Plant

Location:

Kazakhstan

Project number:

50026

Business sector:

Power and energy

Notice type:

Private

Environmental category:

B

Status:

Cancelled

PSD disclosed:

05 Oct 2018

Translated version of this PSD: Russian

Project Description

Provision of financing for the construction of a 50 MW wind power plant in the Almaty region of Southern Kazakhstan (the "Project") in the form of an up to EUR 46.3 million senior loan.

Project Objectives

Located in the electricity-constrained southern part of the country, the Project will help reduce dependence on electricity import from other regions (mostly coal fired plants in the North) and reduce
associated transmission losses.

Transition Impact

This will be the third involvement of the Project's sponsors (Total EREN SA and Access Infra Central Asia Ltd) in the Kazakh market along with two ongoing solar projects in the south of Kazakhstan that the sponsors have been contemplating with EBRD participation. The Project is expected to be the first private wind project in Kazakhstan and will act as a flagship example for unlocking the country's huge wind energy potential. Furthermore, the Project will demonstrate the viability of project finance structures that are still scarce in the Kazakh market. The Project could result in carbon savings estimated at around 37,500 tonnes of CO2 for the country in a sector which is dominated by aged coal-fired plants.

Client Information

ZHERUYIK ENERGO LLP

Zheruyik Energo LLP, a special purpose entity established in the Republic of Kazakhstan to implement the Project, will act as a borrower. The borrower will be jointly owned and operated by Total EREN SA (France) (majority) and Access Infra Central Asia Ltd. (UAE).

EBRD Finance Summary

KZT 16,020,000,000.00

Up to EUR 46.3 million senior loan to Zheruyik Energo LLP with no recourse to the Sponsors.

Total Project Cost

KZT 36,841,702,410.00

KZT 38 billion (equivalent to EUR 93 million)

Environmental and Social Summary

Categorized B. Environmental and social issues associated with the development of a greenfield 50 MW wind power plant, located 37 km east Shelek town in Enbekshikazakh district, Almaty region, are expected to be site-specific and readily assessed based on Environmental and Social Due Diligence (ESDD) and can be mitigated via ESAP implementation and provision of adequate management resources to address identified E&S risks. The Project is consistent with GET approach and its share is expected to be 100%, subject to confirmation by ESDD

An independent ESDD has been undertaken to confirm the proposed site settings and ascertain the environmental and social risks, considering cumulative impacts and associated auxiliary facilities for HV grid connections. Particular focus has been on the site location and sensitivity, notably in terms of birds, bats and flora, which required thorough baseline biodiversity assessment, as well as overall land acquisition and use for the wind turbines and the associated infrastructure (transmission lines and roads).  The proposed WPP site is not located near sensitive receptors and the ESDD confirmed that the Project will have limited impacts on flora and fauna.

The ESDD revised the proposed 110 kV Overhead Transmission Line (OHL) with several alternative routes analysed. Limited Critical Habitat Assessment has been performed on the preferred power line route and it has been confirmed that critical habitat requirements will not be triggered. Project's potential collision and electrocution impacts from the turbines and power lines are not likely to be very significant as long as mitigation measures for collision and electrocution impacts are incorporated in the project design.

Community and livelihood impacts were also analysed and it has been identified that they are mainly associated with increased traffic during construction and some visual impacts, which are considered negligible.  Social, labour and safety aspects during construction and operation, were analysed and number of recommendations were presented to the EPC contractor in order to strengthen its institutional capacity to manage E&S risks during the construction and operational phases and deliver the Project in line with Bank's Performance Requirements (PRs). The Client will prepare a Social Compliance Audit (SCA), which will assess the compliance of the potential land acquisition process, potential impacts on ethnic groups, labor and gender considerations with relevant national laws, Lenders' and other social requirements. If there are any gaps identified under the SCA, corrective actions will have to be identified and implemented. The client will additionally undertake the contractor risk assessment to review the compliance of contractor's labor management practices, including the workers' working conditions and temporary accommodation. 

A comprehensive ESAP has been developed for the Project, which includes, in addition to the above mentioned mitigation measures, such actions as: enhancement of the EHS management system, contractor and supply chain management, construction safety, Stakeholder Engagement Plan and grievance mechanism, biodiversity protection measures and others. As part of implementing the ESAP requirements, the Company will implement a Corporate Social Responsibility Program (CSRP) aimed at community development and outreach, including local social infrastructure, and increasing awareness of the Project. The ESAP has been agreed with the Client.

Overall the ESDD confirmed that the Company has the institutional capacity to implement the Banks' Performance Requirements.

Based on the ESDD a site specific Non-Technical Summary (NTS), Stakeholder Engagement Plan (SEP) and were developed and agreed with the client.  The NTS and SEP have been published by the client in local languages and English.

Technical Cooperation

TC funding will be sought to co-finance due diligence costs under the existing Kazakhstan Renewables Framework Programme (KAZREF) designed to support renewable energy projects in Kazakhstan or the GET Project Preparation and Implementation Support Programme.

Company Contact Information

Community Liaison Officer (CLO) Mrs. Yuliya Allakhverdiyeva
ayulena@gmail.com
+77052929251

Business opportunities

For business opportunities or procurement, contact the client company.

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Email: procurement@ebrd.com

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