EBRD AND VNESHECONOMBANK JOIN FORCES TO SUPPORT ARMENIA’S ENERGY NETWORK
The Financial
June 17 2009
Georgia
The FINANCIAL — The EBRD is providing a loan of up to â~B¬42 million
to the electricity distribution company Electric Networks of Armenia to
promote energy efficiency throughout the Caucasus republic. The project
is supported with â~B¬200,000 in technical assistance from Spain.
"The project will also be co-financed by Russia’s Vnesheconombank
which will provide â~B¬22.5 million to Electric Networks of Armenia
under an agreement signed today. The EBRD and Vnesheconombank signed
an intercreditor agreement. Both banks are joining forces in a third
country for the first time and the cooperation is seen as a milestone
in regional cooperation," EBRD informs.
The loan to Electric Networks of Armenia will finance energy efficiency
measures including an upgrade and modernisation of the low-voltage
infrastructure to reduce losses and the installation of meters to
improve the quality of supply.
These measures will increase the overall efficiency of the power
distribution system in Armenia, reduce network losses and improve
the quality of power supply through better frequency control and
reduction of power outages significantly.
Electric Networks of Armenia is owned by InterRAO UES of Russia. It
is the single supplier of electricity in the country. Third party
access to the distribution network is to be introduced by 2013.
Nandita Parshad, EBRD Director for Power and Energy, said "This project
provides us with an excellent opportunity to demonstrate what can be
achieved with improvements in energy efficiency. Reduced losses and
improved quality will benefit both the distribution company as well
as the consumer, be it businesses or private households. We expect
the successful implementation of the modernisation programme to have
a demonstration effect for the wider region."
Evgeniy Gladunchik, Chief Executive Officer of Electric Networks of
Armenia, added "This is the largest loan the EBRD has ever provided
to an Armenian company without a sovereign guarantee. It will help
ENA significantly to improve our operating and financial performance".
The EBRD has made the promotion of energy efficiency one of its core
activities. Under its Sustainable Energy Initiative I (SEI), started
in 2006, the Bank has financed over â~B¬2.7 billion in 166 projects
yielding 21 million tonnes of CO2 reductions. Building on the success
of the initiative the EBRD is now launching its Sustainable Energy
Initiative II.