KRAKOW PUBLIC TRANSPORT COMMERCIALISATION& FINANCING PROJECT

Location:

Poland

Project number:

34554

Business sector:

Municipal and environmental infrastructure

Notice type:

Public

Environmental category:

B

Approval date:

30 Nov 2004

Status:

Complete

PSD disclosed:

20 Sep 2004

Project Description

The proposed project comprises investments in public transport infrastructure (tram/busway) and rolling stock (trams) to be implemented by the City of Krakow and its public transport company (MPK).  
Project objectives are to improve public transport services; improve the framework of public transport regulation in the city; enable private sector participation in bus services; and demonstrate feasibility and best practices in public transport financing with EU Structure Funds.  
The project is expected to be one of the first public transport projects co-financed with EU Structural Funds.

Transition Impact

  • Public transport services will become more commercially organised through a long-term Public Service Contract, moving away from annual negotiated subsidies to transparent multi-year payments for service against defined targets.
  • Through the Project the City will separate the regulatory, operations and infrastructure management functions currently carried out by overlapping institutions, and establish a Public Transport Authority to regulate public and private sector transport operators in the City.
  • Through the Project, the City will tender out a substantial portion of the bus network to the private sector for the first time, increasing competition in the sector.
  • As one of the first projects in Poland anticipated for support by EU Structural Funds, it should set an example for project preparation and appraisal to international standards.  Lessons learned during the project are also likely to be widely disseminated given the public transport company’s active engagement in the Polish Chamber of Transport Companies and the International Association for Public Transport (UITP).

The Client

  • Miejskie Przedsiebiorstwo Komunikacyjne S.A. (Krakow Public Transport Company, MPK) a joint stock company fully owned by the City providing bus and tram services in Krakow.
  • The City of Krakow, Poland’s third largest city with a population of 740,000.

EBRD Finance

The project is expected to comprise two syndicated loans from the Bank, of which EBRD portion would be:
  • Up to EUR 17 million (or PLN equivalent) senior loan to the public transport company (MPK)
  • Up to EUR 3.5 million (or PLN equivalent) loan to the City.
 

Project Cost

EUR 62 million (or PLN equivalent).

Environmental Impact

Environmental classification and rationale 
The EBRD has classified the project B/0. Environmental impacts of the project are mainly positive. Any adverse impacts can be readily identified, assessed and mitigated and appropriately addressed in an Environmental Analysis. The project does not involve existing facilities and, therefore, no environmental audit is needed.
Information reviewed during the environmental appraisal 
The environmental appraisal has been based on the review of the following information:
Assessment of the environmental impact for the feasibility study of the project “The Integrated Public Transport in the Krakow Agglomeration”, Ekologia I Zdrowie, Krakow, July 2004
Environmental issues 
The environmental investigations showed that the project would result in some environmental improvements and that any adverse environmental impacts would be limited. The project has been structured to meet Polish and EU environmental standards and adequate mitigation measures have been incorporated in the project design. Construction-related impacts, such as additional noise, vibration and exhaust gas emissions from construction machines, have been assessed to be localised and short term in nature. They will be efficiently prevented or mitigated by applying international construction practices and planning. The trams to be purchased will comply with Polish and EU standards and make use of best available technology.
Environmental opportunities 
The Project will improve public transport reliability, safety and efficiency, and help maintain the share of public transport in total transport, with associated air quality benefits. The introduction of a new tram fleet will help develop public transport alternatives as well as reduce traffic congestion, noise and air pollution in Krakow. The relocation of the bus terminal will reduce the need for transporting empty buses and result in annual fuel savings of more than 50,000 litres and associated emission reductions. The purchase of “silent trams”, along with the means to damp the noise and vibration caused by the tramway, will contribute to reducing noise emissions into the environment and therefore it will also improve the living standard of the persons who live in the nearest houses.
Summary of mitigation measures 
The project design and investment plans incorporate a number of measures to protect the environment, including:
  • the construction of a tight pavement in order to protect surface waters, groundwater and land;
  • reconstruction of the draining system of the tramway;
  • the construction of a rainwater drainage system including a settling tank and a separator upstream of the wastewater discharge into the wastewater collection system at the new bus terminal;
  • the protection of the existing greenery for the duration of the construction works; and
  • in order to limit the noise and vibration-related annoyance caused by the operation of tram carriages, technical means such as an elastic and flexible technology to fix the tramway to the concrete foundation will be applied.
Disclosure of Information and consultation 
Environmental information on the project has been disclosed in accordance with the planning and construction procedures of Polish law at the municipal office of Krakow. No environmental impact report was required for the planned scope of the project. MPK will continue carrying out the permitting process and disclosure of environmental information on the project in accordance with the Polish law. In the context of EBRD’s participation in the project, this environmental summary has been disclosed locally at MPK and City of Krakow’s offices as well as in English on EBRD website at www.ebrd.com.
Monitoring and reporting 
MPK will report to EBRD annually on the measured environmental impacts and on the implementation of the mitigation measures. The Bank will evaluate the project's compliance with the applicable environmental and social standards during the lifetime of the project by reviewing these reports. EBRD environmental specialist may also conduct monitoring visits to the project when and if deemed appropriate.
 

Technical Cooperation

EUR 93,000 call-off from EU-Phare Bangkok facility-funded framework contract to support economic, environmental and institutional appraisal of the project. 
 

Business opportunities

For business opportunities or procurement, contact the client company.

For state-sector projects, visit EBRD Procurement: Tel: +44 20 7338 6794
Email: procurement@ebrd.com

General enquiries

EBRD project enquiries not related to procurement:
Tel: +44 20 7338 7168
Email: projectenquiries@ebrd.com

Public Information Policy (PIP)

The PIP sets out how the EBRD discloses information and consults with its stakeholders so as to promote better awareness and understanding of its strategies, policies and operations. Please visit the Public Information Policy page below to find out how to request a Public Sector Board Report.
Text of the PIP

Project Complaint Mechanism (PCM)

The Project Complaint Mechanism (PCM) is the EBRD's accountability mechanism. It provides an opportunity for an independent review of complaints from individuals and organisations concerning EBRD-financed projects which are alleged to have caused, or are likely to cause, environmental and/or social harm.

Please visit the Project Complaint Mechanism page to find information about how to submit a complaint. The PCM Officer (pcm@ebrd.com) is available to answer any questions you may have regarding the submission of a complaint and criteria for registration and eligibility, in accordance with the PCM Rules of Procedure.