ESCO INTERNATIONAL S.A.

cancelled

The project aims to establish an Energy Service Company in Poland to be known as "ESCO International" to finance and implement small and medium-sized energy efficiency projects. The objective of the project is to promote small and medium-sized energy efficiency projects. With the proceeds of the Bank's financing, ESCO International will finance and install energy-saving equipment. It is expected that the project will have a significant impact on the transition by: (a) reducing the energy intensity in the Bank's countries of operations; (b) introducing specialised financial, technical and legal skills for further implementation of energy-saving projects; (c) demonstrating that energy performance contracting is feasible under present economic circumstances in the Bank's countries of operations; and (d) encouraging local and Western private sector investment in ESCO structures and more generally in energy efficiency. ESCO International, a joint-stock company to be incorporated in Poland, will develop its activities in all of the Bank's countries of operations. ESCO International will be established, majority owned and operated by Difko Energy A/S (a 100 per cent subsidiary of Difko A/S, a Danish financial investment group) together with its sister company LR Energi A/S, a leading Danish engineering company in the field of cogeneration (the exploitation of waste heat released in the generation of electric power). The proposed EBRD financing consists of an equity investment of US$ 2.12 million (ECU 1.90 million), a subordinated loan of the same amount and a US$ 11.37 million (ECU 10.22 million) loan to ESCO International. It is expected that the Investment Fund for Central and Eastern Europe (IØ Fund) will also participate in the ESCO International Project. Additional loans will be provided through commercial banks. It is intended that ESCO International will benefit from a framework agreement with the Danish Export Credit Agency (EKF), under which the payments of ESCO International clients will be partly guaranteed. US$ 55.72 million (ECU 50.06 million). The project has been classified C/0 and therefore does not require an Environmental Analysis or an Environmental Audit. By implementing energy-saving projects, the project will not only reduce energy wastage by introducing efficient technologies, but also reduce the generation and release of energy-related pollutants. None