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The merger of Termocom with Combined Heat and Power Plants (CHPs) into one company should occur before the end of 2013, and this issue should be a priority on the political agenda of the Government, the Mayor’s office and all stakeholders. Otherwise there is a risk for thousands of Chisinau residents to be affected, believe Ms Ingrid Tersman, Ambassador of Sweden in Moldova, and Mr. Abdoulaye Seck, World Bank Country Manager for Moldova.
At the Press Club meeting organized by the IJC on November25, Ms Ingrid Tersman said that 160 thousand residents of the capital, who have no alternative sources of heating, are at risk to remain without heating due to an outdated and inefficient heating system. “It is true, the price for heating will not decrease in the future, but we need to reduce the inefficiency of energy consumption, which primarily affects ordinary people,” said the Ambassador of Sweden in Moldova, Ingrid Tersman.
Referring to the current situation with the central heating system, Abdoulaye Seck, World Bank Country Manager, said that the financial situation of Termocom is very difficult, with its debt of USD 138 million to CHP-1, CHP-2 and Moldovagaz and inability to attract investment. For this reason the old and inefficient heating system of Chisinau has a rupture rate 10 times higher than modern systems.
To reform the Chisinau central heating system, international community representatives proposed solutions based on analytical studies, the best being merger of CHPs and Termocom into one company in order to increase the efficiency of production and consumption of heating and to ensure the company’s financial viability. The company’s future financial viability will be discussed by the Government, Mayor’s office and all parties involved in the process.
In this context, Dumitru Budianschi, program director of the analytical center “Expert Group”, explained that the problem lies in the process, which is focused on the manufacturer rather than the consumer. For this reason, the expert recommended reforming the system through a partnership between consumers, the Government and municipality.
The World Bank’s Country Partnership Strategy provides total funding in the amount of USD 570 million over the next 4 years. The proposed project of improving the CHS efficiency includes a planned investment of USD 40 million for the modernization of equipment and networks, transition from central to individual heating points and a Partial Credit Guarantee amounting to USD 80 million intended for debt restructuring. “However, it will happen only when the Government demonstrates political will and commitment to fight corruption,” concluded Abdoulaye Seck, World Bank Country Manager.
The issues of the central heating system have been covered in an opinion article by Ingrid Tersman, Ambassador of Sweden in Moldova, and Mr. Abdoulaye Seck, World Bank Country Manager, available here.
The Press Club was organized by the IJC at the initiative of the World Bank and the Swedish Embassy in Moldova.
