Burgas Integrated Urban Transport Project

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The Bank is considering providing a loan of up to € 11.1 million to the City of Burgas as part of the Bank’s co-financing of the City’s Integrated Urban Transport Project, It is expected to be jointly funded with EU grant under Operating Programme ‘Regional Development’ on a blended basis. The project’s total cost amount to € 67 million of which up to € 47 million will be provided by the EU Cohesion Fund on a grant basis. The project components to include: The physical investments will be supported by extensive project management from the EU Cohesion Funds, as well as Bank-funded TC grants. It is expected to achieve the following transition impact: Improved contractual framework for markets through introduction of a long term Public Service Contract. The new multi-year contractual arrangement between the City and the operators will establish sound and transparent relationship which will enable a solid framework for service delivery and regulation of a key public service, and will facilitate improved service quality, corporate development and will help achieving cost efficiency over time. Burgas will be one of the first cites in Bulgaria to implement a PSC which follows the guidance of the EU Regulation 1370/2007, which came into effect on December 2009. The PSC approach ensures a long-term sound and transparent contractual relationship which: BRT demonstration leading to fuel consumption savings and emissions reductions: Replacement of the obsolete and inefficient rolling stock with the new, clean diesel and CNG buses will produce significant fuel savings, as well as lowering emissions due to cleaner engine technology and greater efficiencies. According to the Project’s Feasibility Study prepared by JASPERS, replacement of the old rolling stock itself should result in a reduction of 50 per cent for CO2, and 90 per cent for NOx, NMHC and PM10. In addition, the higher commercial operating speeds on the BRT corridor will allow for a 15-20 per cent reduction in fleet sizes, thus saving even greater fuel consumption. Finally, the development of BRT will demonstrate the benefits of this high-capacity, yet relatively low-cost solution in the Bank’s countries of operations, and should produce a moderate modal shifts from private cars to public transport, thus reducing emissions even further. The City of Burgas. Loan of up to € 11.1 million. € 67 million. The project has been categorised B in accordance with EBRD's 2008 Environmental and Social Policy. The priority investments are expected to provide significant improvements to quality, safety, accessibility and energy efficiency of public transport system, contribute to improve ambient air quality and pedestrian safety in the City of Burgas, as well as promote environment-friendly and sustainable modes of transport. The project has been subject to Initial Environmental and Social Examination, which showed that the potential adverse future environmental and social impacts have been assessed as part of EIA screening procedure, concluding that the proposed investments are not likely to have significant adverse impacts, providing that appropriate mitigation measures are/will be implemented. The due diligence includes a corporate review of the Client's current environmental and social management systems, the past and current performance against EBRD's Performance Requirements (PRs), and environmental and social analysis of any potential environmental and social impacts and benefits of the priority investment programme. The due diligence also includes a review of the reports prepared by the JASPERS consultants as part of the project preparation for EU Cohesion Fund financing. An Environmental and Social Action Plan 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. The Client will also develop a Stakeholder Engagement Plan, including a grievance mechanism. This PSD will be updated when the results of due diligence are known.