EBRD Lends US$30m to ICS Premier Energy Distribution
ICS Premier Energy Distribution S.A., Moldova's biggest private operator of electricity distribution systems, is set to receive a loan of US$ 30 million from the European Bank for Reconstruction and Development (EBRD) for its investment programme until 2025.
The loan will aid the company in upgrading and modernising the power grid in the central and southern regions of the country, including Chisinau, the capital, as well as digitalising its operations.
Promoting energy resilience is a crucial component of the EBRD's investment strategy for Moldova between 2023-2028. This latest loan comes after Chisinau, the Moldovan capital, became the first city in the country to participate in the EBRD Green Cities programme, a flagship initiative worth €5 billion that aims to enhance urban sustainability. In 2020, Chisinau created a "Green City Action Plan" that prioritised air pollution and climate change mitigation as key environmental concerns.
The EBRD's second Green Cities project in energy, and the first in Europe, will aid in the modernisation of the regional grid, addressing both issues by replacing older, less energy-efficient equipment with new ones, resulting in an annual reduction of over 2,500 tonnes of carbon dioxide emissions and a 21% decrease in losses. The investment programme will concentrate on Chisinau and the surrounding region, with more than half of it directed towards the city.
The loan provided to Premier Energy Distribution aims to convert a traditional distribution grid into a digital smart grid, ensuring a secure supply of electricity and improved services for customers. It is divided into two tranches, with US$ 22 million allocated for the company's investment programme until 2024 and an additional US$ 8 million for its 2025 programme.
The European Investment Bank (EIB) will co-finance the project by lending an additional US$30 million. Premier Energy Distribution is an existing client of the EBRD and is mostly owned by Emma Capital Limited, a Cyprus-based limited liability company. The company is responsible for the majority of electricity distribution in Moldova, covering around 70% of the country's territory.
As a significant institutional investor in Moldova, the EBRD prioritises enhancing the country's energy resilience, establishing a business-friendly atmosphere, enforcing European standards across various sectors, promoting regional integration to connect local producers to their target markets, and developing public utilities that are both sustainable and efficient, and that can improve the daily lives of citizens.