Rijeka District Heating

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Translated version of this PSD: Croatian The EBRD is considering financing a new combined heat and power plant (“CHP”) with a planned capacity of 20 MWt and 3 MWe. The electricity produced in the CHP plant will be sold to the national grid operator and heating and/or cooling to the University of Rijeka Campus, the City of Rijeka General Hospital as well as a number of residential buildings. The transition impact of the proposed transaction will be achieved through: Energo d.o.o. Rijeka (the “Borrower” or the “Company”) is a utility company incorporated in Rijeka, Croatia, providing three types of public services: gas distribution, district heating and street lighting. The Company is majority (56.9 per cent) owned by the City of Rijeka, while the remainder of the ownership is split among Amga Udine (Italian utility company) with 34 per cent of ownership and Croplin (joint venture of German EoN and Croatian oil company INA) with 9.1 per cent. Senior loan of up to EUR 10 million to the Energo d.o.o. Rijeka. Up to EUR 10.7 million. The project has been categorised B in accordance with EBRD's 2008 Environmental and Social Policy. The priority investments into the rehabilitation and modernisation of the district heating infrastructure are expected to bring environmental and social benefits associated with the overall improvement in the quality of heating and hot water services, improved energy efficiency, reduction in fuel consumption and heat and water losses, and lower air emissions. Independent due diligence has been done by an international consultancy. It includes a review of the Company’s corporate environmental, health and safety and social management capabilities and procedures in relation to its own workforce and construction contractors, and an analysis of the environmental and social impacts and benefits of the proposed investment to establish the level of project's compliance with EBRD's Performance Requirements (PRs). Due diligence has identified a number of actions required to be addressed by the company to meet EBRD requirements and an action plan has been developed. The action plan includes items such as increase in capability and capacity to manage environmental and social issues and to develop management systems aligned with international standards - while maintaining local regulatory compliance. In addition, issues associated with occupational health and safety, contractor management, waste management and development of sustainable procurement policy are to be adopted by the company. The above action plan has been incorporated into an Environmental and Social Action Plan (ESAP) has been developed by the consultant and reviewed by EBRD, which includes corrective actions and mitigation measures for identified issues to ensure that the company meets the EBRD requirements. In addition, a Stakeholder Engagement Plan (SEP) has been developed and approved by the Client. The Client agreed to implement the ESAP and SEP and submit annual environmental and social reports to the Bank. The following technical co-operation (“TC”) assignments are a part of this project: Pre Loan Signing Post Loan signing