• Client

    Far Eastern Federal District Region

  • Background

    The 19 settlements in two municipalities existing communal infrastructure operation demanded a significant annual increase in regional subsidies. The infrastructure upgrade was hampered by the lack of funds in the state budget, and imperfection of regional legislation in the field of attracting private investment

  • Situation

    On the first stage the technical audit of the current state of the generation and transmission facilities for heat and electric energy, water in settlements, as well as problem areas have been identified with the participation of a specialized contractor. On the second stage SBS Consulting consultants developed scenarios for the modernization of housing and communal services based on energy-efficient solutions, including the use of renewable energy sources, considering the prospects for the socio-economic development of the region (assessing the demand for fuel and energy resources). The tariff and budgetary consequences of the implementation of various sets of measures model calculations helped to determine the optimal scenario in terms of the need for modernization of housing and communal services assets and the region's ability to provide tariff and non-tariff income to the investor in the long term. In parallel, SBS Consulting team determined the circle of potential investors, developed and approved the key parameters of their participation in projects

  • Results

    The developed scenarios for the modernization of housing and communal services formed the basis of the programs for the integrated development of the communal infrastructure of settlements, and also determined long-term targets for the operation of housing and communal services. The region attracted a strategic investor to conclude a concession agreement for heat and water supply in targeted settlements. Work is underway to structure the conditions for investor participation in order to conclude a concession agreement and to prepare documents for attracting co-financing from the Fund for Assistance to Housing and Utilities Reform In addition, a regional model for managing concessions in the housing and communal services sector was formed, which includes:
    (1) guidelines for authorities on working with communal concessions,
    (2) standard draft concession agreements, taking into account regional specifics,
    (3) a package of documentation for conducting an open competition for the right to conclude a concession