USAID Project Assistance in Attracting Investments
As stated above, the Catalogue of investment projects (hereinafter – the Catalogue) was developed to ensure effective implementation of the Kramatorsk SEAP measures. Information in the Catalogue is broken down by municipal sectors:
1) residential buildings;
2) public buildings;
3) heat supply;
4) water supply and sewage;
5) street lighting;
6) public transport;
7) power supply, etc.
Price forecast for energy resources and energy services was used for assessment of financial flows. Each project proposal contains a scope of investments and economic performance indicators.
Several funding sources are proposed for the implementation of Kramatorsk SEAP, including regional and state budgets, international banking institutions, private investors, etc. A chart below shows distribution of financing by sector. Total project investments for 2015-2030 is 8 371.3 mln UAH.
Funding of SEAP Projects and Programs for 2015-2030 (UAH mln)
HEAT SUPPLY
Total funding envisaged for three proposed projects is UAH 341.8 mln, average payback period – 5.1 years.
Three largest heat supplying companies in the city are “Kramatorskmizhrayteplomerezha” Regional Heating Company that operates six boiler houses; Kramatorsk Municipal Heating Enterprise, which has 14 boiler houses on its books; and JSC “Kramatorskteploenergo” that is based at the Kramatorsk Heat and Power Plant and covers 68% of the total heating needs of the city. Coal and natural gas are primary fuel sources in the city heating system. In 2013, Kramatorsk city consumed total of 583,000 Gcal of heat energy, including 543,000 Gcal for heating and 40,000 Gcal for hot water supply. Between 2007 and 2013, the city nearly halved its energy consumption for hot water supply from 73,000 to 40,000 Gcal/year. Such decrease in consumption was due to the installation of water meters by consumers, transition to autonomous water heating systems (water heaters installed), and decline in city population by nearly 6%.
The USAID Project experts are working out a pre-feasibility study on partial substitution of natural gas by biomass in the city heating system.
The investment projects for the sector provide for upgrading heating systems and peaking boiler plants (connecting all consumers to basic heat supply of Kramatorsk HPP, constructing new pre-insulated pipes); adjusting thermal and hydraulic operating regimes of the district heating network (energy inspection of district heating system, assessment and necessary works); upgrading thermal inputs of buildings (reconstruction of individual heat points (IHPs) with installation of plate heat exchangers and automatic heat meters).
The implementation of project activities will not reduce СО2 emissions since the replacement of natural gas with coal, as envisaged by one of the projects, would inevitably increase СО2 emissions. However, connecting most buildings of district heating system to the Kramatorsk Heat and Power Plant, which has much higher efficiency compared to local boiler houses, will reduce the annual energy consumption by 20,800 thousand m3 of natural gas, but will increase coal use by 18,000 t / year and СО2 emissions by 4,700 t / year (0.6% of baseline).
In 2016, the city is completing the Project “Reconstruction of Lazurniy Boiler House at 85, Balyayev Street, Kramatorsk with the installation of КВ-ГМ-10 Boiler”. It has been approved by 2015-2018 Kramatorsk Housing Reform and Development Program (Resolution of the City Council No. 44/VI-266 dated 10.12.2014). In 2015, the project activities were partially covered (60%) by the State Fund for Regional Development (SFRD) and from the local budget. This year, the State Fund for Regional Development will be allocating necessary funding to implement the Capital Upgrades Project for III Main Heat Supply Area in Kramatorsk City.
WATER SUPPLY AND SEWAGE
Total funding envisaged for the proposed project is UAH 69.5 mln, average payback period – 4.9 years.
Water is supplied to the city by the Donbas Water Utility Company so all-necessary amount of water is purchased. It is supplied through water pipelines with diameters of 1,000 mm and 1,200 mm (for drinking needs) and the Siversky Donets – Donbas pipeline for technical needs. The average annual amount of water purchased is 19,241 thousand m3 with 9,299 thousand m3 being sold. Sewerage and water supply services are rendered by the local “Kramatorsk Vodokanal” Water Supply Company, which serves 60,500 customers in multi-apartment buildings, 26,500 customers in private sector and 2,050 companies, organizations and institutions. Purified water is supplied by six pumping stations through 611.8 km of water pipelines. The sewerage system consists of 238.9 km of gravity sewers with wastewater being further purified at a biological treatment plant. Average energy consumption for water supply is 0.457 kWh / m3 and for sewage - 0.552 kWh / m3. In 2013, actual per capita consumption of drinking water was 130 liters / day.
Pursuant to the Catalogue, the investment project includes upgrading pumping equipment at the water purification plant (installing new pump units with nominal performance characteristic value that corresponds to actual parameters of water supply), and improving compressor performance (it is proposed to use the block method for water aeration, which would allow to maintain bubbling tubes without stopping and emptying the tanks).
The proposed measures for water supply and sewage sector will allow reducing СО2 emissions by 3,200 t / year or 0.41% of the baseline. Total reduction of energy consumption would be 2,900 MWh / year.
In 2016, Kramatorsk has completed the reconstruction of the 2nd lift pump station that supplies water to remotely located houses and companies of the city. They have replaced a pump and launched an additional one, installed valves and piping and a water flow control system, replaced a transformer and power unit, run a new water line, replaced liquid chlorine with safe sodium hypochlorite for water purification. Replacement of equipment and installation of additional treatment units was funded by the United Nations Development Project (UNDP) and the Government of Japan. Modern equipment ensures an accident-free operation and twenty-four-hour water supply. In 2016, total of eight projects will be implementedin the water supply and sewage sector.
PUBLIC TRANSPORT
Total funding envisaged for the proposed project is UAH 4.1 mln, average payback period – 7.9 years.
The city transport network includes bus, trolleybus and tram routes with a total length of 390.2 km. There are three passenger transportation companies operating in the city: “Kramatorsk Tram and Trolleybus Department” utility company and two private companies “Kramatorsk ATP-11410” and “Yumvosa”. The public transport network has 38 routes, including three tram routes, three trolleybus routes and 32 bus routes. In 2012, the passenger rolling stock included 186 transport modes: 162 small and medium capacity buses, six tramcars and 18 trolleybuses.
The investment project provides for the reconstruction of city electric traction substations of the “Kramatorsk Tram and Trolleybus Department” by upgrading electric equipment at three facilities.
The proposed measures for public transport sector will allow reducing СО2 emissions by 400 t / year or 0.05% of the baseline. Total reduction of energy consumption would be 400 MWh / y.
The USAID project experts conducted an energy audit at the traction substation to evaluate the condition of public electric transport system and determine power consumption. The document was used to prepare the terms of reference for procurement of equipment.
With the help of these documents, in late May 2015, Kramatorsk won a grant from the EU Regional Program in the Neighborhood for Sustainable Urban Demonstration Projects (SUDeP) for the Project “Modernization of Municipal Electric Traction Substation”. The Project is one of the key elements of the SEAP for municipal transport sector. The total project budget is over € 1.2 mln with over € 985.6 thousand being covered by the EU grant.
STREET LIGHTING
Total funding envisaged for 2 proposed project is UAH 62.1 mln, average payback period – 8.3 years.
The “Misksvitlo” Utility Company is responsible for management, maintenance, overhaul and ongoing repairs of power supply lines of city street lighting. The total length of power lines is 474.5 km, including 406.3 km of overhead lines and 68.2 km of cable lines. There are 8,554 street lighting fixtures in the city and 977 of them are out of service. In 2013, the power consumption for outdoor lighting was 2.3 GWh / year. The largest amount of electricity is consumed when night rates apply and that is on average 65% of total power consumption. Cost of electricity consumed by off-the-meter light fixtures is 54%.
The investment proposals include upgrading of city streetlights using LED light fixtures and solar power station (two sub-projects that can be implemented separately, but are integral parts of one project). The Project focuses on generating and selling green tariff electricity, thus reimbursing the cost of nighttime energy consumption.
The proposed measures for outdoor lighting sector will allow reducing СО2 emissions by 3,800 t / year or 0.48% of the baseline. Total reduction of energy consumption would be about 3,500 MWh / year.
POWER SUPPLY
Total funding envisaged for the project is UAH 4,332 mln, average payback period – 9.3 years.
The generation, transmission and distribution of electricity in the city are vested with the Kramatorsk Electric Power Utility Company. The company’s electricity generation system includes 45 power substations with an installed transformer capacity of 693 megavolt-amperes, 979 high-voltage power lines, 50 distribution points, 2,033 transformer substations and 10,013 circuit kilometers of power lines. Between 2007 and 2013, industrial companies were the main consumers of electricity, using approximately 60% of the power supplied to the city. In 2013, the electricity consumption, excluding industry needs, was 267,100 MW.
The investment project is aimed at constructing the Kramatorsk Wind Farm with the total energy capacity of 150 MW, which will produce green tariff electricity and sell it to the Ukrainian unified electricity system.
The proposed measures for power supply sector will allow reducing СО2 emissions by 284,300 t / year or 36% of the baseline. Total reduction of energy consumption would be about 260,800 MWh / year.
PUBLIC BUILDINGS
Total funding envisaged for two projects is UAH 405 mln, average payback period – 9.2 years.
The public sector facilities are managed by the City Council and include 35 kindergartens and 33 schools, 16 health care facilities, community centers, recreation centers, art schools, museums, 15 libraries, a folk theater, municipal recreation and entertainment facilities. The total heated floor area of the municipal building stock is more than 270,000 m2, and, in 2013, power consumption of public buildings was 48,100 MWh. All public buildings that were constructed during the Soviet times amount to large energy loss due to poor insulation in building envelopes and require a considerable amount of heat. Average energy consumption for heating is 80-145 kWh / m2 per year, which exceeds the European energy performance standards (15-45 kWh / m2) and regulatory limit values (45-70 kWh / m2), specified in State Construction Standards В.2.6-31:2006 for Thermal Insulation of Buildings with amendment No. 1.
Project proposals for public buildings provide for thermal insulation of public buildings by upgrading internal heat supply system, installing modern radiators, improving walls, facades and basement ceilings (114 buildings); switching all public buildings to solid fuel and heat pump heating systems (111 buildings).
The proposed efficiency measures for public buildings will allow reducing СО2 emissions by 17,500 t/year or 2.22% of the baseline. Total reduction of energy consumption would be about 4,900 thousand m3 of natural gas and 4,100 t of coal per year.
In 2016, the city is implementing 18 projects aimed at improving thermal insulation of municipal buildings. The Project “Major Capital Works. Replacement of windows and doors, heat insulation of facades and roof of the Kramatorsk Ukrainian High School” is funded by over UAH 10.5 million of NEFCP grant.
RESIDENTIAL BUILDINGS
Total funding envisaged for the proposed project is UAH 3,143.7 mln, average payback period – 10.1 years.
The city housing stock has a total area of 2,423.6 thousand m2 in 876 buildings that are serviced by six private companies, including JSC “Krambudresurs”, JSC “MK-2010 Utility Company”, “Alatyr” privately-owned company, “Ladis” privately-owned company, “SIV” private company, and JSC “Kuibyshev Steel Plant”. Two and four story buildings account for 53% of multi-family housing stock. The majority (52%) of houses were built before 1960. A significant amount of heat is lost through the building envelope and it takes much energy to heat these buildings. Average energy consumption for heating residential buildings is 85-156 kWh / m2 per year, which exceeds the European energy performance standards (15-45 kWh / m2) and regulatory limit values (45-70 kWh / m2), specified in State Construction Standards В.2.6-31:2006 for Thermal Insulation of Buildings with amendment No. 1.
The investment proposal for residential buildings provides for thermal insulation of residential buildings by upgrading internal heat supply system, installing modern radiators, improving walls, facades and basement ceilings (for 487 apartment buildings over four stories high).
The overall reduction of СО2 emissions in the residential sector regarding heat consumption is 167,400 t/year or 21.2% of the baseline. Total reduction of energy consumption would make 31,500 thousand m3 of natural gas and 25,600 t of coal per year.
In 2016, the city is implementing four projects aimed at improving thermal insulation of multi-apartment buildings located at: 53, Yaroslav Mudryy St.; 70, Akademichna St.; 10, Parkova St.; 10, Myru Avenue.
