Lipetsk Wastewater Treatment Plant

Location:

Russia

Project number:

41847

Business sector:

Municipal and environmental infrastructure

Notice type:

Public

Environmental category:

B

Target board date:

14 Dec 2010

Status:

Repaying

PSD disclosed:

27 Aug 2010

Translated version of this PSD: Russian

Project Description

The EBRD is considering providing a loan of up to RUB 300 million (~EUR 7.6 million) to Lipetsk Municipal Unitary Enterprise “Lipetsk Aeration Station” to finance the rehabilitation of the main wastewater treatment plant of the City of Lipetsk. The project will contribute significantly to improving the environmental and health situation in the Lipetsk region by decreasing the level of polluting discharges into the Voronezh river and the Volga-Don basin. The proposed investments will also reduce energy consumption and operating costs of the Company.

Transition Impact

The transition impact will be delivered through:

(i) A Public Service Contract establishing an arms length relationship between the Company and the City, regular tariff adjustments, incorporation of investment costs on a systematic basis and transparent tariff-setting process that will increase the financial and operational sustainability of the Company and allow medium to long-term investment financing.

(ii) Involvement of international consultants at the preparation and implementation phases through the technical cooperation initiatives that will allow relevant employees of the City and the Company to tap international financial, managerial, procurement and engineering expertise and result in significant knowledge and skills transfer.

(iii) Rehabilitation and modernisation of wastewater treatment plant that will result in energy efficiency improvement by reducing energy consumption for wastewater operations. The technical due diligence will assess and quantify projected energy efficiency gains.

(iv) Adoption of a Stakeholder Engagement Plan (SEP), as part of the Environmental and Social Action Plan, that will allow the Company to improve its business conduct and external communications.

The Client

Lipetsk Municipal Unitary Enterprise “Lipetsk Aeration Station” (the “Company”), a municipal company, wholly owned by the City of Lipetsk (the “City”).

EBRD Finance

Senior loan of up to RUB 300 million (~EUR 7.6 million) to the Company under the full municipal guarantee of the City of Lipetsk (the “City”).

Project Cost

RUB 360 million (~ EUR 9.2 million).

Environmental Impact

Categorised B in accordance with EBRD's Environmental and Social Policy. The project is expected to have environmental benefits by reducing polluting discharges from Lipetsk to the Voronezh river and the Volga-Don basin and by improving energy efficiency.

Environmental and social due diligence will be undertaken covering the WWTP networks, sludge management practises and any other associated facilities.

Based on the results of due diligence, an Environmental and Social Action Plan (ESAP) 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. A project-specific Stakeholder Engagement Plan (SEP) will need to be prepared. This PSD will be updated when the results of due diligence are known.

Technical Cooperation

Project preparation

  • Technical Due diligence of the proposed investments and preparation of the procurement plan (estimated at EUR 30,000 – to be funded from the Bank own funds);
  • Environmental Due Diligence of the Company (estimated at EUR 20,000 – to be funded from the Bank own funds);
  • Restatement of accounts in accordance with IFRS before Final Review (estimated at EUR 30,000 – to be funded from the Bank own funds).

Project implementation

  • PIU support and Project Engineer for procurement, design and contracts supervision (estimated up to EUR 400,000 – to be funded by an international donor);
  • FOPIP including preparation of Public Service Agreement, aimed at enhancing the Company’s commercial viability and institutional capacity (estimated up to EUR 150,000 – to be funded by an international donor).

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.