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EBRD funding for controversial transmission line through Usatove may be suspended

The European Bank for Reconstruction and Development is calling for a halt to the construction of high voltage power lines in the Odessa region and has expressed strong concern over the unauthorized change in the route for the transmission line. The initial plan was agreed with EBRD and was the condition for the bank’s participation in the financing of the project. A press release, seen thus far only in Russian, states that EBRD is no less concerned by the conflict and instances of physical confrontation between police officers and residents of the village of Usatove linked with the construction of a transmission line by the National Energy Company Ukrenergo.

According to the press release, EBRD has sent a letter to Ukrenergo expressing concern over the conflict between Usatove residents and the company with regard to property rights in the construction zone, as well as over clashes between police and local residents opposed to the construction work.

The Bank is calling for Ukrenergo to immediately halt construction, take measures to smooth tension in the district, and also stop civil and criminal proceedings initiated in relation to the residents involved in the dispute.

In order to work out a solution which will be acceptable to all parties, EBRD is also offering Ukrenergo its knowledge and experience in resolving conflict linked with project implementation.

of projects.

EBRD has notified Ukrenergo that funding for the given project may be halted until the Bank has carried out an assessment of the environmental and social consequences of Ukrenergo’s decision to change the initial route for the transmission line and the latter has taken all necessary measures to properly resolve all environmental and social problems linked with this change.

The Bank is asking for a clear action plan for the elimination or amelioration of the adverse consequences which could occur as a result of changes to the initial project, as well as for the payment of compensation to the relevant parties in connection with the planned work.

The EBRD 25.8 million dollar loan was given to Ukrenergo to modernize high voltage power transmission lines and approved in 2005 on condition that the route did not pass through the village of Usatove.

In its letter, the Bank stresses the need to follow the Environmental and social policy of the Bank, according to which its clients must adhere to internationally accepted standards on publishing information, public consultation and review of complaints.

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