News Column

Sabac District Heating Upgrade

September 4, 2014

Business sector:Municipal and environmental infrastructure


Environmental category:B

Target Board date:11 Nov 2014

Status:Passed concept review, Pending final review

PSD disclosed: 3 Sept 2014

Project Cost : Total project costs to be determined during due diligence.

Project Description : The EBRD is considering providing a senior loan of up to 7 million to the City of Sabac (the City ), located in western Serbia, to support the upgrade of the City s district heating ( DH ) system. The loan will be on-lent to Sabac District Heating Company (the Company ), entirely owned by the City.

The technical due diligence, currently ongoing, will determine the least cost and most energy efficient technical solution to upgrade the DH system. The upgrade will focus on the introduction of local biomass, as partial replacement for natural gas, for heat generation. The due diligence will consider the installation of new biomass-fired boilers or a small-scale combined heat and power plant ( CHP ) for simultaneous generation of heat and electricity. The Project will be implemented by a Project Implementation Unit supported by external experienced consultants financed from technical assistance funds.

The success of the Project will be measured by the following benchmarks:

Total population benefiting from improved district heating.

Annual reduction in tonnes of CO2 equivalent in Project area.

Transition Impact : The transition impact potential of the Project arises from:

Establishment of a Public Service Agreement between the City and the Company;

Improved financial sustainability within the Company through improved cost recovery and operating efficiencies introduced by a financial and operational performance improvement programme ( FOPIP ); and

Potential CO2 savings.

The Client : Sabac District Heating Company. It is wholly owned by the City of Sabac and it is responsible for operating the DH system in Sabac. The Company owns two district heating plants (installed capacity of 66.6 MW) and two small capacity boilers (installed capacity of 6.8 MW). It provides heating services to 7,514 households and, in 2012, it produced and sold 70,175 MWh of heating energy.

EBRD Finance : Up to 7 million loan to the City of Sabac to be on-lent to the Company, co-financed with a capital grant of up to 2 million from an international bilateral or multilateral donor.

Environmental Impact : The project has been Categorised B in line with the Bank s 2008 Environmental and Social Policy. The independent environmental and social due diligence ( ESDD ) of the Company and the project consisted of an E&S audit of the Companys management systems and practices, the existing facilities and operations, and an E&S analysis of the impacts and benefits of the Project.

The ESDD identified that the implementation of the Project will result in increased reliability and efficiency of district heating services, and reducti

Project completion date : 2015-12-31 12:00:00


Address : Sabac

Financier : European Bank for Reconstruction and Development (EBRD),

Financier address : European Bank for Reconstruction and Development (EBRD)

One Exchange Square

London EC2A 2JN

United Kingdom

Website :

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Source: TendersInfo (India)

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