Moldova Power Distribution Equity Investment



Project number:


Business sector:

Power and energy

Notice type:


Environmental category:


Approval date:

04 Apr 2000



PSD disclosed:

23 Mar 2000

Project Description

The project consists of a minority equity investment alongside Union Fenosa Internacional of Spain (UFISA), a strategic investor, in three power distribution companies located in Chisinau and the central and southern regions of Moldova. Purchase from UFISA minority interests in three power distribution companies. EBRD involvement has been requested by UFISA to help mitigate political risk.

Transition Impact

The project supports the continuing privatisation of the electricity sector in Moldova and the development of management know-how and technology, which should lead to collection and performance improvements.

The Client

UFISA. (Spain), the sponsor, is a wholly owned subsidiary of Union Electrica Fenosa S.A., a major private Spanish utility with electricity distribution experience in emerging markets. In February 2000, UFISA purchased a 100 per cent stake in three Moldovan power distribution companies (RED Chisinau, RED Centru and RED Sud). UFISA has requested that the EBRD becomes a minority co-investor in these three companies.

EBRD Finance

The EBRD has purchase from UFISA shares in the three power distribution companies for an aggregate price of US$ 5 million (€5.16 million) for an equity stake of up to 18.6 per cent in each of the companies.

Project Cost

US$ 5 million (€5.16 million).

Environmental Impact

The project was screened C/1, requiring an environmental audit of the three regional electricity distribution companies (REDs). The audit, carried out by independent consultants, did not reveal any major environmental, health and safety concerns. The issues identified included possible PCB use, safety upgrades of the sites, improvements to fuel storage areas, hazardous waste handling and "housekeeping". Measures have been included in Environmental Action Plans (EAPs) for the REDs to address these issues. In addition, recommendations were made regarding general environmental management at the REDs. The EAPs will be agreed with UFACEX in the Share Purchase and Shareholders’ Agreement.


The project offers the opportunity to steer the companies towards environmental management practices in line with Western standards. This includes, over and above compliance issues, improved resource use, energy efficiency at facilities, reduction of distribution losses and improved materials and waste management.


The implementation of the project would result in the reduction of carbon dioxide emissions by approximately 30,000 tons per annum after 2005.

Technical Cooperation

Legal due diligence (€149,130 from Japan; €50,000 from Canada); financial and technical due diligence (€133,621 from Greece; €57,940 from Japan).


Business opportunities

For business opportunities or procurement, contact the client company.

For state-sector projects, visit EBRD Procurement: Tel: +44 20 7338 6794

General enquiries

EBRD project enquiries not related to procurement:
Tel: +44 20 7338 7168

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

Independent Project Accountability Mechanism (IPAM)

If efforts to address environmental, social or public disclosure concerns with the Client or the Bank are unsuccessful (e.g. through the Client’s Project-level grievance mechanism or through direct engagement with Bank management), individuals and organisations may seek to address their concerns through the EBRD’s Independent Project Accountability Mechanism (IPAM).

IPAM independently reviews Project issues that are believed to have caused (or to be likely to cause) harm. The purpose of the Mechanism is: to support dialogue between Project stakeholders to resolve environmental, social and public disclosure issues; to determine whether the Bank has complied with its Environmental and Social Policy or Project-specific provisions of its Access to Information Policy; and where applicable, to address any existing non-compliance with these policies, while preventing future non-compliance by the Bank.

Please visit the Independent Project Accountability Mechanism webpage to find out how to submit a Request for review through our confidential online form, by email, mail or telephone. IPAM is available to discuss your concerns and answer any questions you may have about the submission or handling of Requests, which follow the Project Accountability Policy and Guidance. Requestors’ identities may be kept confidential, upon request.

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