The European Bank for Reconstruction and Development is mulling a EUR 10 million loan to the district heating utility municipally owned enterprise Chernivtsiteplokomunenergo, operating in the city of Chernivtsi, the EBRD said in a statement.

The funds will be used to finance the installation of individual heating sub-stations, biofuel boilers, network replacement with pre-insulated pipes, modernization of boilers and control systems, and the installation of monitoring and dispatching system in the city, the EBRD said.

The EBRD finance includes EUR 7 million in an EBRD loan to the company, and EUR 3 million from the Clean Technology Fund (CTF), both secured by a municipal guarantee of the city.

The project is expected to be co-financed by a grant of up to EUR 4 million from the Eastern Europe Energy Efficiency and Environment Partnership (E5P).

The project is to be co-financed by a local contribution of up to EUR 2 million.

The total cost for the feasibility study assignment was EUR 180,000 financed under the Ukraine District Heating Project Preparation Framework by the government of Sweden. The estimated total cost for the IFRS audit assignment is EUR 20,000, proposed to be financed by the EBRD's own resources.

What is more, the company's corporate development program to improve financial and operational performance of the company. The estimated total cost for the assignment is EUR 250,000, proposed to be financed by a bilateral or multilateral donor or the EBRD Shareholder Special Fund (SSF).

The estimated total cost for project implementation support covering procurement advisory services, implementation support and contract supervision is EUR 450,000, proposed to be financed by a bilateral or multilateral donor or the SSF.