Rousse Water Investment Project

Location:

Bulgaria

Project number:

36142

Business sector:

Municipal and environmental infrastructure

Notice type:

Public

Environmental category:

B

Target board date:

21 Feb 2006

Status:

Repaying

PSD disclosed:

08 Dec 2005

Project Description

The proposed project provides finance to upgrade and expand water and wastewater infrastructure of the Rousse Regional Water Company and improves its financial and operational performance. The project is designed to complement significant ISPA grant investment finance. The Bank will focus on renovation of the water transmission main, while ISPA grant funds will be used for water and wastewater infrastructure investments, including a construction of a new wastewater treatment plant. The proposed project would be the second ISPA co-financing of a local water utility following the financial close of the Bourgas Water and Wastewater project in June 2005.

Transition Impact

This transaction has a significant transition impact set in the context of the overall Bulgaria Water and Waster Facility (BWWF) for EUR 60 million. The sources of Transition Impact are threefold:

(i) establishing an effective legal and regulatory framework for municipal finance;

(ii) commercialisation of the operating company as a model for future cities under the BWWF and

(iii) tariff reform.

Support for the commercialisation of the Company and for institutional improvements
Technical co-operation mobilised by the Bank will promote the commercialisation of the Company and improve its financial and operational performance. Milestones and targets agreed with the Company will be included as covenants in the Loan Agreement. Additional technical cooperation is planned to establish and support a Project Implementation Unit

Demonstration effect
The Operation would be the second transaction in Bulgaria where the Bank would lend directly to a state owned regional water company without a sovereign or municipal guarantee

Improved financial planning and management for the City of Rousse.
In order to help the City to improve its creditworthiness a Creditworthiness Enhancement Programme is planned to assist the City in defining and managing its budget, including its capital investment plans.

 

The Client

Rousse Water Company is a regional water supply and wastewater treatment company, 51 per cent owned by the State through the Ministry of Regional Development and Public Works, 32 per cent by the Municipality of Rousse and the remaining 17 per cent are shared among other smaller municipalities.

EBRD Finance

  • EBRD loan to the Company: EUR 8.0 million

  • Co-finance: EUR 35.1 million ISPA Grant

  • Other sources; EUR 3.7 million

  • EBRD TC Donor grant; EUR 0.7 million

 

 

Project Cost

Total project cost is estimated to EUR 47.5 million.

Environmental Impact

The project was screened B/1.

The renovation of water transmission main (the part of the project which will be financed by EBRD) is associated with limited environmental impacts and will result in significant environmental benefits. Potential environmental impacts of this operation will be mitigated applying internationally recognised good management practices.

Technical Cooperation

Associated TC programmes are:

  • Establishment of Project Implementation Unit (PIU) and assistance with tendering and project procurement: EUR 250,000 to be identified
     
  • Creditworthiness Enhancement Program for Rousse Municipality EUR 200,000 to be identified
     
  • Development of Financial and Operational Performance Improvement Plan: EUR 250,000 to be identified
     
  • Creditworthiness Enhancement Program for Rousse Municipality EUR 200,000 to be identified
     
  • Development of Financial and Operational Performance Improvement Plan: EUR 250,000 to be identified
 

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)

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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.