Ivano-Frankivsk District Heating Project

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The EBRD is considering providing a senior loan to Ivano-Frankivsk TeploKomunenergo, a district heating company wholly-owned by the City of Ivano-Frankivsk, to finance priority capital expenditure programmes aimed at reducing energy losses, reduce gas and electricity consumption and improving quality of service of heat and hot-water supply system in certain areas in the City. Key reform elements include a shift to a modern demand driven district heating system based on individual substations with metered consumption, meter-based billing and a cost and consumption reflective tariff methodology (elimination of subsidies). The district heating company Ivano-Frankivsk “TeploKomunenergo”, a municipal utility wholly-owned by the City of Ivano-Frankivsk. The City will provide a financial guarantee in support of the project. EUR 11.2 million. EUR 15.45 million (funds not provided by EBRD are expected to be funded by donors under technical cooperation funds and local contributions) Screened B/1 requiring an environmental analysis of the proposed investment and an environmental, health and safety audit of the existing operations and facilities of the Client. An environmental due diligence for this project has not been completed yet. However, the following issues might be associated with the project. Environmental issues: rehabilitation of the district heating system should mainly result in environmental benefits associated with reduction of heat and hot water losses. However, there might be some issues related to the disposal of construction waste, increased noise and dust levels at the construction stage. Health and safety issues: the project involves a decommissioning of several old boilers and replacement of pipes, where asbestos might be present in the form of boiler coating and pipes lagging for thermo-insulation purposes. An asbestos survey would need to be conducted and appropriate procedures for asbestos removal and handling developed and strictly adhered to by demolition/construction subcontractors in order to prevent the asbestos contamination. The Project will need to comply with Ukrainian environmental, health, safety and labour regulations and standards and with pertinent EU standards. A total of EUR 845,000 of TC assistance is required to prepare, design and implement the Project. It will include: Donors for the design and implementation phase assignments are yet to be identified.