Moldova District Heating - Project Identification Study

Moldova District Heating - Project Identification Study

The European Bank for Reconstruction and Development ("EBRD" or the "Bank") is considering extending loan financing to rehabilitate components of the district heating system in several cities in Moldova. Other financial institutions ("FIs") may also be interested in implementing district heating projects in the country or in co-financing.

As a key legacy of the planned economy, the existing district heating system in Moldova is usually the primary source of space heating and domestic hot water service and has deteriorated significantly over the past decades. The EBRD is actively looking to identify one or a number of bankable district heating projects in Moldova, either as one or a number of stand-alone projects, or as a programme comprising demonstration projects in 2-3 cities.

The EBRD is now seeking to engage a qualified consultant (the "Consultant") to carry out a two-phased assignment. The first phase will focus on the identification of one or a number of cities where district heating is tentatively deemed as a least-cost solution for space and possibly domestic water heating in a part or parts of the cities. In a second phase, which shall commence only after approval by the Bank, the Consultant shall carry out a comprehensive technical, financial and environmental due diligence on the proposed projects. The assignment will comprise the following tasks.

Phase 1: the overall objective of the Phase 1 is to assess the current state of the district heating market in Moldova, taking into account the various heating options available and to assess the possibilities for the EBRD and other FIs to implement district heating projects in Moldova, where district heating is identified as a least-cost solution. The Consultant will aim to identify 1-3 cities where centralised district heating would be most appropriate as a least-cost solution and from an efficiency and demonstration perspective. Project proposals should be prepared for cities where district heating is still operational and where the investment projects can be based on system rehabilitation. Based on this assessment, the Consultant shall propose one or more project/s or a programme to be implemented by one or more FIs, whether the project/s should be stand-alone or part of a larger programme, and the approximate size and investment components to be included.

Phase 2: the overall objective of Phase 2 is to prepare comprehensive feasibility studies which can be used by the FIs to identify and structure bankable projects and justify their involvement. To this end, the Consultant shall inter alia:

- develop an affordable, least-cost and bankable strategic investment programme for the proposed project/s or programme in a long-term perspective (15-20 years);
- identify and assess a detailed priority investment programme ("PIP");
- for each project, undertake an environmental and social due diligence in accordance with the EBRD's "Environmental and Social Policy (2008)" and its "Performance Requirements", including an "Environmental, Health and Safety Audit" of existing district heating operations and facilities, and a review of environmental and social management systems in the proposed cities, as well as an "Environmental and Safety Analysis" of the proposed investment programme;
- prepare a detailed financial analysis of the district heating company/companies and cities, and financial projections, and propose an appropriate tariff system based on actual consumption and full cost recovery, and assess the loan:grant ratio needed for the proposed priority investments to be affordable to the affected population. The Consultant shall also prepare an affordability analysis of various consumer groups affected by the project/s or programme.

Assignment Start Date and Duration: the assignment is expected to start around October 2012 and last for 18 weeks (including both phases).

Cost Estimate for the Assignment: EUR 300,000; Exclusive of VAT.

The consultant must determine whether any VAT would be chargeable on the services and the basis for that determination, without taking into consideration the Bank's special status as an IFI and state this to the Bank in their response to the Invitation for Expressions of Interest. To the extent that a consultant incurs input VAT on goods and services purchased in connection with the provision of services (e.g. VAT on airline ticket) which is not otherwise recoverable by the consultant from the local tax authority, the gross cost to the consultant of such expenses shall be treated as a reimbursable expense.

Funding Source: It is anticipated that the contract will be financed through the EBRD's donor funded Technical Cooperation Funds Programme. Consultant shortlisting and selection will be subject to availability of appropriate funding.

Eligibility: there are no eligibility restrictions.

Consultant Profile: Corporate services are required. The Consultant should have extensive experience in the district heating sector in the EBRD's countries of operation and in working with FIs. The following categories of expertise are envisaged:

- team leader with comprehensive experience in similar assignments in eastern Europe with similar climatic conditions to those in Moldova and in working with FIs;
- technical specialists and engineers in district heating, demand side management and mechanical and energy engineering;
- financial analysts with experience of carrying out due diligence on former Soviet municipal companies with extensive experience in financial modelling;
- institutional and regulatory issues specialist;
- environmental and social specialists with experience of district heating projects and working with FIs.

It is recommended that a part of the consultancy input will be carried out by local consultants.

Submission Required: Interested firms are hereby invited to submit expressions of interest.
In order to determine the capability and experience of consulting firms seeking to be shortlisted, the information submitted should include the following:
- company profile, organisation and staffing;
- details of experience or similar assignments undertaken in the previous five years, including their locations;
- CVs of staff who could be available to work on the assignment.
The above information should not exceed 20 pages excluding CVs.
Expressions of Interest shall be submitted, in English, electronically through e-Selection, to reach the Bank not later than the closing date set out above.

EBRD Contact:
Angela Levitsky
European Bank for Reconstruction and Development
Tel: + 44 20 7338 6363

Fax: +44 20 7338 7451
e-mail: LevitskA@ebrd.com

The expression of interest must be accompanied by a completed Contact Sheet, the template for which is available from the following web-link:
http://www.ebrd.com/pages/workingwithus/procurement/notices/csu/contact_sheet.doc

Note: Following this invitation for expression of interest, a shortlist of qualified firms will be formally invited to submit proposals. Consultant shortlisting and selection is subject to availability of funding.

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