European Bank for Reconstruction and Development. The EBRD is considering providing a loan of to €7.6 million to S.C. Gospodarie Comunala S.A for water and wastewater infrastructure improvements. The financing is a sub-project of the €200 million Framework for Romania EU Cohesion Fund Co-Financing for regionalised water companies (the “Framework”).
The project will be cofinanced by a regional investment programme of up to of €78.9 million, which will include significant grant funding from the European Union, the Government of Romania and the local governments under Romania’s Cohesion Fund Programme. The investments are expected to significantly reduce water losses, optimise operating costs and expand the water supply and wastewater collection and treatment services in Covasna County, in line with relevant EU directives.
Transition Impact
The sub-project will support environmental improvements as well as the continued regionalisation of water and wastewater services in Covasna County, which will result in efficiency gains as well as the transfer of commercial and managerial skills to less-developed localities in the county. The Company will participate in a benchmarking programme alongside other borrowers under the Framework, which was approved by the Bank to co-finance projects in Romania’s water and wastewater sector alongside EU Cohesion Funds.
The project will also inlcude tariff adjustments to achieve financial and operational sustainability.
In addition, the transition impact potential for this Project will be further enhanced based on the fact that the Company is expanding to smaller and less developed communities, resulting in a greater scope for institutional capacity building.
The Client
S.C. Gospodarie Comunala S.A. (Apa Canal Covasna).
EBRD Finance
Senior loan of up to €7.6 million.
Project Cost
Up to €86.5 million.
Country: Romania.Project number:42570.Business sector: Municipal and environmental infrastructure.Public/Private: Public.Environmental category:
IEE.Board date: Status:Passed concept review, Pending final review.PSD disclosed: 2 Dec 2011
