Translated version of this PSD: Romanian
The EBRD is considering providing a loan of up to EUR 13.6 million to Compania de Apa Oltenia S.A. (the Company) for water and wastewater infrastructure improvements in Dolj county, in southern Romania.
The EBRD loan will co-finance a EUR 150.3 million regional investment programme supported by significant grant funding from the European Union, the Government of Romania and the local governments under Romania’s Cohesion Fund Programme.
The project will enable the Company to extend and rehabilitate its network in the County as well as to improve water and wastewater services in the towns of Craiova, Calafat, Bailesti, Filiasi, Segarcea, Dabuleni, Bechet and 4 rural localities (Ciupercenii Vechi, Poiana Mare, Tunarii Vechi and Calarasi). Investments are expected to significantly reduce water losses, optimise operating costs and expand water supply and wastewater collection and treatment services in Dolj County in line with relevant EU directives.
Upon implementation of the project, the Company is expected to achieve the following physical indicators:
- Water losses from water supply systems will decrease from 17 million m3/year to 9 million m3/year;
- Amount of untreated sewage will decrease from 38 million m3/year to 26 million m3/year.
The EUR 13.6 million loan project is a sub-project of the EUR 130 million extension of the Regional EU Cohesion Fund Water Co-Financing framework (the R2CF Framework) approved by the Bank to co-finance projects in Romania’s water and wastewater sector alongside EU Cohesion Funds. The project summary document for the Framework was published on 23 September 2010.
R2CF Dolj together with other sub-projects under the Framework will support environmental improvements, efficiency gains from continued regionalisation of water and wastewater services and transfer of commercial and managerial skills in water and wastewater operations to less-developed localities. Compliance with the European Union relevant water legislation is also envisaged.
Under the Framework extension, the transition impact is also sought by building energy efficiency components into the existing water projects.
Compania de Apa Oltenia S.A, a regional operating company providing water and wastewater services in the County of Dolj, located in southern Romania.
EUR 13.6 million to Compania de Apa Oltenia S.A.
EUR 150.3 million.
Categorised B. The potential E&S impacts of construction/rehabilitation of wastewater treatment plants and extension and rehabilitation of water distribution and sewerage networks are likely to be site-specific and can be readily identified and addressed through adequate mitigation measures. The competent environmental authorities undertook EIA screening procedure for individual project components in accordance with applicable Romanian EIA legislation that is harmonized with the EU EIA Directive. Following the screening and public consultations, the authorities decided that EIAs were not required for any of the sub-projects. None of the sub-projects fall under category A in accordance with the Bank's Environmental and Social Policy.
Environmental and social due diligence (ESDD) has been carried out by independent consultants. The ESDD included a site visit, review of the Company's existing E&S management systems, available technical and environmental documentation prepared in accordance with Romanian permitting requirements and the project appraisal documents prepared for the EU Cohesion Fund application as well as assessment of the project against EU environmental requirements and the EBRD PRs.
The ESDD concluded that the implementation of the sub-projects for water supply and wastewater discharge and treatment will ensure compliance with national and EU requirements within the transition period agreed for meeting requirements of Directive No. 98/83/EC on drinking water quality (by 2015) and Directive 91/271/EC on urban wastewater (from 2013 to 2018 depending on the agglomeration size). The project is not expected to require any land acquisition or cause any significant displacement or resettlement impacts. However, some temporary disturbance may occur during the construction phase. There is a provision within the ESAP to develop a process to address any such disturbance and or displacement that may occur, in accordance with the Bank’s policy. No other potential significant adverse impacts or non-compliances with the EBRD PRs have been identified. The construction works will have limited, localised and short-term adverse impacts, which can be mitigated or prevented by adhering to good construction practice.
The ESDD showed that the project will result in significant environmental benefits and improve the quality of the local environment and mitigate public health risks by extending the drinking water supply and wastewater collection networks, improving drinking water treatment and quality, improve sewage collection and wastewater treatment systems. 55 per cent of the Dolj county population (around 390,000 people) will benefit from improved water and wastewater services. The project will increase wastewater collection from 61.2 per cent current to 93.7 per cent in 2014 and improve water supply connection rate from 81.4 per cent current to 97.8 per cent in 2014.
Part of the project components will be implemented within NATURA 2000 sites. This involves rehabilitation works at Calafat WWTP which is located within N2000 sites (ROSCI-0039 and ROSPA-0013); part wastewater discharge pipe from Ciupercenii Vechi to Calafat WWTP (3,300 m) crossing the N2000 site (ROSCI-0039) along the county road; and rehabilitation of water supply station (reservoir, chlorination station, pumping station) which is located in N2000 site (ROSCI-0039) but in an urbanized area. The environmental authorities concluded that these project components are not likely to have significant impacts on Nature 2000 sites and that no appropriate assessment was required of the project. The screening decision and environmental notification present measures for the minimization of the impact on the sites during the construction period, respectively operation period. The Natura 2000 declaration has been issued conditional to the implementation of these specific measures.
The ESDD established that the Company’s existing environmental management system is well developed and it has an integrated ISO 14001 and ISO 9001management system in place. ESAP requires the Company to also develop a health and safety management system. An Environmental and Social Action Plan (ESAP) has been developed for mitigation of identified E&S issues and impacts during preparation, construction and operation of the project, and to bring the Company's operations into compliance with the EBRD's PRs.
The Company will provide the Bank with annual environmental and social reports, including updates on the implementation of the ESAP. The Bank will commission a completion audit and may also conduct monitoring visits, as required.
The project will benefit from TC under the original Framework and its extension, including:
- Analysis of the environmental and social impacts, issues and risks and a gap analysis. (EUR 125,000 under the original Framework and extended by EUR 100,000 to support sub-projects under the Framework extension), financed by the Government of Spain.
- Financial due diligence (EUR 75,000 under the original Framework and extended by EUR 91,000 to support sub-projects under the Framework extension), financed from the Bank’s own resources.
- Benchmarking and FOPIP programme (EUR 750,000 under the original Framework and extended by EUR 257,301 to support sub-projects under the Framework extension), financed by the EBRD Shareholder Special Fund.
- Sector-Wide Pilot Project to Enhance Transition through Procurement Benchmarking and Certification (EUR 180,000 under the Framework extension), financed by the EBRD Shareholder Special Fund.
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