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Detail of GEF Project #130

GEF Project ID130
IBRD PO ID45573
Funding SourceGEF Trust Fund
Project NameRenewable Energy and Regional Development Project - Szekesfehervar Biomass-Gas CHP Project
CountryHungary
RegionEurope and Central Asia
Focal AreaClimate Change
Operational ProgramSTRM
PDF-B Approval Date1997-11-01
Approval Date1997-11-01
Project Cancellation Date2001-02-28
Project StatusCancelled
GEF AgencyWorld Bank
Executing AgencyMinistry of Industry and Trade; City of Szekesfehervar
DescriptionThis project would decrease greenhouse gas emissions while providing heat and competitively priced electricity to the residents of Szekesfehervar by substituting straw and natural gas for fuel oil in the local district heating plant. Secondary benefits to Hungary include increased rural employment and incomes through collection and utilization of agricultural waste straw, and reduced reliance on imported oil. The project will demonstrate the potential in central Europe for biomass- and natural gas-powered integrated district heating/combined cycle cogeneration technology applications.
Implementation StatusThe project was approved for inclusion into GEF work program at Council Meeting in November 1997. The project has been stalled because the local utility and the regional utility involved have been caught up in legal battles. Since this situation is not showing any sign of resolution in the near future, the Bank is now recommending dropping this project from the GEF pipeline. A mission to Hungary in October, 2000 will convey this message to the government and stakeholder parties. It was finally agreed NOT to continue with the preparation of this project for two major reasons: First one is a project specific reason 'the loss of the counterpart", which is rather unique for Szekesfehervar case, and the second one is a problem facing almost all renewable energy projects in the region "the liberalization of the European Electricity Market'. More detailed information can be found in the final report prepared by the Task Manager. Project was finally dropped for the following reasons: (i) a lawsuit between the City of Szekesfehervar and the electric distribution company EDASZ resulting in delays, tensions, and eventual lack of a strategic investor; (ii) reluctance of the City to resort to debt financing in the absence of a strategic investor; (iii) the City's stated desire to proceed with an alternative project design at its own pace and excluding the biomass component while utilizing some results of the Bank's feasibility study. There are no outstanding commitments under this project.
PDF B Amount
250,000 USD
GEF Project Grant
5,800,000 USD
GEF Grant
6,050,000 USD
Cofinancing Total
54,200,000 USD
Project Cost
60,250,000 USD
Project Documents

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