project „removing barriers to promote and support the...

Министарство рударства и енергетике

Project „Removing Barriers to Promote and Support

the Energy Management System in Municipalities in

Serbia “

Professor Miloš Banjac, Ph.D.

Assistant Minster and the National Project Director

Ministry of Mining and Energy

Inception workshopThe Serbian Chamber of Commerce

14 December 2015


Contents

1. Basic Project Information

2. Project background

• Reasons for delay in Project implementation

3. Project financial model

• Co-financing by the Republic of Serbia

• Participation of other partners

4. Project management

5. Key goals of the Project

6. Project components

• Component 1

• Component 2

• Component 3

• Component 4

7. Proposed changes in the Project document

8. Conclusion


Basic Project information

• Title: „Removing Barriers to Promote and Support the Energy Management System in

Municipalities in Serbia“

• Project objective: Energy management system introduced and increased investment

in energy efficiency of public buildings and utility services.

• Total value of the Project: USD 21,900,000

– The Global Environmental Fund (GEF): USD 2,300,000

– UNDP: USD 200,000

– Other Project participants: USD 19,400,000

• Project implemented by:

– UNDP (4 components) and

– The Ministry of Mining and Energy: sub-component 3.1 relevant to award of grants

for implementation of investment projects in 10 municipalities

• Project duration: 2015 – 2020


Project background

• May 2013 – Funds intended for Serbia identified in the GEF STAR 5 allocation. The

deadline for their implementation was expiring in 2013.

• May 2013 – the then Ministry of Energy, Development and Environment, as the then GEF

CC FP, under urgent procedure, signed the letter approving the project proposal titled

“Removing Barriers to Promote and Support the Energy Management System in

Municipalities in Serbia” and authorized the UNDP to develop as soon as possible the

project concept – the so-called Project Identification Form as application to GEF

(PIF).

• June 2013 – the PIF was submitted in time for the meeting of the GEF Board of Directors

(GEF Council)

• August 2013 – The GEF Technical Committee approved the PIF and proposed it to the

Board of Directors to provide financing for preparations.

• January 2014 - The GEF Secretariat approved the grant for project preparation

amounting to USD 100,000 based on the decision by the Board of Directors of December

2013.


Project background

• February 2014 – meeting was held of the Local Project Appraisal Committee (LPAC),

marking the beginning of Project preparation.

• The beginning of project preparation was lagging behind due to elections.

• May 2014 – April 2015: Project preparation.

• Project preparation was carried out by the UNDP with the engagement of a

consulting company GFA.

• The Project was supported by:

– The Ministry of Mining and Energy of the RS;

– The German Development Bank - KfW;

– The Japanese International Cooperation Agency – JICA;

– The Standing Conference of Towns and Municipalities – SCTM.

• May 2015 – the Project proposal for the first time submitted to GEF Secretariat

for approval


Project background

• 23 June 2014 – Project Document approved by GEF Secretariat.

• 18 February 2014 Local Project Appraisal Committee Meeting held.

• Decision by the Government of the RS was requested for the purpose of signing of the

Project Document.

• September 2015 – October 2015, opinions collected from 9 relevant ministries and

institutions.

• October 2015 – by the decision of the Government of the RS, the Minister of Mining and

Energy, Aleksandar Antić, was authorized to sign the Project Document and the

Letter of Agreement on Joint Implementation of the Project.

• 22 October 2015 - the Minister of Mining and Energy, Aleksandar Antić, signed the

Project Document and the Letter of Agreement on Joint Implementation of the

Project with the UNDP.

• 14 December 2015 – the Inception Workshop was held, marking the official beginning of

the Project implementation.


Difficulties encountered during Project implementation

• Project preparation, including elaboration of the project concept, was done very

quickly and efficiently, thanks to the engagement and dedication of the staff from

the Department for Energy Efficiency of the Ministry of Mining and Energy and thanks

to the support by the UNDP Energy Team.

• The cooperation with the GFA consulting team was very good.

• A short stay in the preparation happened due to elections in 2014.

• The institutional framework of the Project was changed only once:

– From May 2012 to May 2014

• The Ministry of Energy, Development and Environment

– Since May 2014.

• The Ministry of Mining and Energy


Reason for delay in beginning with project implementation

• The delays in the beginning of project implementation occured due to the request that

the Government of the RS should approve the Project, requiring nine relevant ministries

and institutions to provide their positive opinions regarding the Project. The opinions

were requested due to the co-financing obligations for demonstration projects stated in

the Letter of Agreement on Joint Project Implementation which is to be provided from

the budget for 2016.

• Positive opinions have been given by:

1. The Legislative Secretariat,

2. The Ministry of Agriculture and Environmental Protection (GEF Focal Point),

3. The Ministry of Finance,

4. The Ministry of Foreign Affairs,

5. The Ministry of Public Administration and Local Self-Government,

6. The Ministry of Economy,

7. The Ministry of Construction,

8. The Ministry of Education, Science and Technological Development,

9. The Government Office for EU Integrations (SEIO).


The financial model – Cofinancing of the Project by the Republic

of Serbia and other partners

Approved Project – June 2015

1 The Ministry of Mining and Energy In-kind 1.5 m USD

3 Municipalities Cash 1.6 m USD

4 Standing Conference of Towns and

Municipalities

In-kind 0.4 m USD

5 JICA Cash 1.0 m USD

6 KfW Cash 9.0 m USD

7 UNDP Cash 0.2 m USD

8 UNDP In-kind 0.3 m USD

Total Cash 17.4 m USD

Total In-kind 2.2 m USD

TOTAL 19.6 m USD


Project management

Project approved – June 2014

Project Implementation Unit within the MMEProject team in the UNDP

Coordinator, assistant, IT associate, lawyer, other support staff of the MME

Project Committee

Senior beneficiary: The Government of the

Republic of Serbia

Implementing body: The Ministry of Mining and Energy

Senior service provider: UNDP

Assurance of Project functionsProject Manager,

UNDP Authorized Programme Officer

Project organizational structure

Other tehcnical support(technical, financial, legal experts, etc.)

Project Implementation Unit

Project National Director

Project partnersSCTM, JICA, KfW


Project goal

Increased investments in energy efficiency in public buildings and utility services under the

competence of municipalities in order to increase their energy and cost efficiency.

Indicators

1. Reduced emissions of equivalent CО2 expressed as direct result of project activities in an amount

of 150 kt during 15 years of the life-cycle of investments into energy efficiency measures.

2. Incremental savings of energy of at least 94 ТЈ/year, or 1,400 ТЈ during the 15 years of the life-

cycle of investments into energy efficiency measures and other measures contributing to the

Project.

3. Value of investments in energy efficiency in public buildings and utility services within the

competence of municipalities which are directly supported by the project amount to 15 mil USD

by the end of the Project.

4. The number of peple benefiting from improved public services.

Source of verification

1. Verified energy savings and reduced emissions of greenhouse gasses.

2. Summary financial reports by Project partners.

3. Final Project evaluation


Project components

1. Incentive legal and regulatory framework supporting the introduction and efficient

operation of the energy management system in local governments and relevant energy

efficiency measures – Implemented by UNDP in cooperation with MME and other

partners.

2. Functional central and municipal units for support to the energy management

system with built capacities for implementation of the Energy Management Information

System and implementation of energy efficiency projects – Implemented by UNDP in

cooperation with MME and other partners.

3. At least 10 demonstration energy efficiency projects identified and implemented

within the activities of the energy management system with the use of Energy

Management Information System – Implemented by the MME and UNDP in

cooperation with other partners.

4. Energy Efficiency Charters of towns and municipalities signed by 80% of local

governments in Serbia in order to raise public awareness and increase capacities to

implement the energy management system and increase investments in energy

efficiency – Implemented by UNDP in cooperation with MME and other partners.


Component 1 – Expected results

• Develop new and review existing laws/regulations regulating energy efficiency.

• Enhance the overall legal and regulatory framework related to energy efficiency.

• Monitor the implementation of regulations in place, identify barriers to their

implementation and formulate recommendations for removal of identified barriers.

• Develop and supported the adoption of voluntary norms and initiatives for the public

sector (ex. „Green public procurements“ etc.).



• A central Project Support Unit established within the existing structure of the MME.

• At least 30 local self-governments have established offices (units) to support energy

management.

• A National Network of Municipal Energy Managers is established.

• A series of training courses delivered related to different aspects of energy management

for energy managers and local government staff;

• Energy efficiency programs developed in 30 local governments.

• Regularly produced annual reports on implementation of energy efficiency programs in 30

local governments.

• Established and regularly updated national data base with data on public buildings.



• Operational and regularly updated web presentation of energy management at local

level and the Energy Management Information System.

• Improved Energy Management Information System in terms of adding modules for

different utility services.

• Improved awareness of local level decision makers and the general public regarding the

energy management system and the need to utilize Energy Management Information

System in local governments.

• Information and promotional activities related to energy management.



• At least 10 demonstration projects of energy efficiency in public buildings /

utility services co-financed on the basis of Public Call to local governments.

• Technical assistance provided for implementation of selected projects.

• Documented and published results of demonstration projects and monitoring and

verification of energy savings and reduced emissions of greenhouse gasses.

• Support to identification and preparation of energy efficiency projects in other

local governments (preparation of energy balances, cost-benefit analyses, project

optimization from the point of view of technical and financial criteria, and criteria of

available funding).

• The manner of implementation of Component 3 is specifically defined in the

Letter of Agreement on Joint Implementation of Projects with the UNDP (Letter

of Agreement – LoA). The Agreement sets forth the so-called National

Implementation Modality – NIM.


Component 3 – Implementation method

• This will be the first instance of combining donor funds and funds of the Budget Fund for

Energy Efficiency.

• The obligations of the Ministry of Mining and Energy will, among other, include the

following:

o Preparation and conducting of the public call to local governments in 2016;

o Implementation of the co-financing model in the public call for each municipality:

Grant by GEF/UNDP: up to 50% of the project cost (not including VAT) as stated in the

application to the public call and calculated in US$ using the UNORE exchange rate (the

UN monthly official exchange rate) valid for the month of closing of the public call;

Local governments: at least 30% of the project cost (not including VAT) as stated in the

application to the public call and calculated in US$ using the UNORE exchange rate (the

UN monthly official exchange rate) valid for the month of closing of the public call plus the

added VAT;

Payment of remaining funds shall be made from the Budget Fund for Energy

Efficiency and shall be defined in the relevant provisions of the public call.


Component 3 – Implementation method

• Obligations of the Ministry of Mining and Energy:

o To carry out selection of projects based on technical evaluation of project proposals

in terms of reducing emissions of greenhouse gasses and reducing the operational

costs of public buildings;

o To undertake subsequent technical assessment of achieved reduction of GHG

emissions and reduction of operating costs of public buildings.

• Obligations of the UNDP:

o Among other things, the UNDP shall provide technical assistance to the Ministry

with respect to technical evaluation of the Project and subsequent verification of

achieved reductions of GHG emissions and reduction of operating costs of public

buildings. The evaluation shall include the making of energy audits of a relevant level

of detail.



• Programme is developed for the establishment of energy management offices (units)

in other local governments on the basis of experiences in the 30 municipalities.

• Energy efficiency charters for towns and municipalities signed by 80% of local

governments in Serbia in order to increase public awareness and raise capacities for

implementation of the energy management system and increase investments in energy

efficiency.

• Educational curricula and textbooks developed covering the field of energy efficiency

and use of renewable energy sources for at least 3 technical occupations (electrical,

mechanical and construction) and introduced in use in at least 10 different occupational

secondary schools.

• Regularly updated Manual for Municipal Energy Managers and instructions for use of

the Energy Management Information System.

• Awareness raising campaigns implemented on the significance of energy efficiency and

energy management.

• Exist Strategy developed in order to achieve sustainability of Project results.


Proposed changes in the Project Document

• Involvement of the Serbian Chamber of Commerce as a Project partner for

activities within all four Project components, especially awareness raising

activities on the significance of energy efficiency and energy management.

• The Serbian Chamber of Commerce is expected to contribute to inclusion of

public and private companies active in the field of energy in order to support

certain Project activities, particularly those related to demonstration projects in

the field of energy efficiency and equipping the technical classrooms in secondary

occupational schools.

• The Serbian Chamber of Commerce is also expected to demonstrate through its

own buildings, with the technical assistance of the GEF Project, the monitoring

of energy and water consumption in real time, by using the Energy

Management Information System.


Proposed new activities within the Project

• The web presentation of energy management, with the technical assistance of the

GEF project, to be integrated in the web portal “Green Energy” hosted and

maintained by the Serbian Chamber of Commerce and Industry, covering energy

efficiency and renewable energy sources and which is partly funded from the current

GEF Project relevant to the biomass market in Serbia.

• To focus awareness raising activities on implementation of demonstration projects

which are to monitor energy and water consumption in real time through the use of

the Energy Management Information System and the so-called EE Panel along with

parallel web presentations. The installation of such systems should aim at

representative and widely visited public buildings.

• UNDP to initiate cooperation with company “EPS Snabdevanje” (Power Provider) in

order to integrate remote reading of meters in public buildings and the Energy

Management Information System. It is necessary also to consider similar cooperation

and possibly establish such functions with major water supply, gas and heat

suppliers.

• Support, through awareness raising activities, national companies engaged in

providing services integrating the use of information technologies and

measurements (the so-called „smart metering“).


Conclusion 1/2

• Although the period from Project document approval to beginning of implementation was

not long, it is necessary through the Inception report to review individual activities

and their results, in terms of amending certain activities and adding the new Project

partner.

• The Project is complex, demanding and long-term which requires good cooperation

and ongoing coordination among implementation partners – the MME and the UNDP.

Therefore, the National Project Director, the Project Manager and the Project

Coordinators have a critical role.

• It is expected from the UNDP and other Project partners to achieve the following:

o Good cooperation and coordination of all activities in different projects;

o To achieve maximum synergy among different projects and avoid duplication and overlapping of

activities;

o Whenever possible, to implement jointly similar activities in order to make most efficient use of

funds available.

• The Ministry of Mining and Energy shall extend the necessary assistance in coordination

and adjusting project activities among all project partners.


Conclusion 2/2

• The Ministry of Mining and Energy encourages other international actors in the

field of energy efficiency to cooperate with the GEF Project and avoid as much as

possible duplication and overlapping of their own activities with the activities planned

under the GEF Project.

• UNDP is expected:

o In accordance with the Letter of Agreement on Joint Implementation of the Project, to

regularly report to and consult with the Ministry of Mining and Energy and, where

necessary, with other partners, on all relevant Project related issues;

o To ensure full transparency in implementing Project activities. This refers especially to

issues related to the time schedule, the budget and selection of staff/consultants for the

Project.

• The Ministry of Mining and Energy supports and encourages the UNDP to

continue to work towards involving new donors in the Project in order to

increase the Project scope, meaning to increase the number of local governments

covered by the Project.


Thank you for your attention!

Miloš Banjac, Assistant Minister and NPD

Ministry of Mining and Energy of the

Repubic of Serbia

[email protected]


mailto:[email protected]

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