KC Pihlaka Solar PV

Overview
Project Summary Document
Environmental and Social Documentation
Procurement
Complaints

Overview

The Project consists of a senior secured limited recourse project financing loan of up to EUR 22 million in favor of KC Solar2 OÜ (the "Borrower"), a special purpose vehicle incorporated in Estonia established to develop, construct and operate a portfolio of two solar PV power plants with a total capacity of 51.43MW located near Tallinn (the "Project"), in Estonia. EBRD loan is approved under EBRD InvestEU Framework for Sustainable Transition (54197).

Project ID 54611

Status Disbursing

Location

Estonia

Business Sector

Energy

Notice Type

Private

Project timeline

Exploratory
Passed Concept Review
Passed Structure Review
Passed Final Review
Board Approved
Signed
Implementing
Completed

Company Contact Information

Mart Peling
mart.peling@kaamos.ee
https://kaamos.ee/?lang=en
Kaamos Group OÜ Veskiposti 2a, 11624 Tallinn

Project ID 54611

Status Disbursing

Location

Estonia

Business Sector

Energy

Notice Type

Private

Environmental Category

Approval Date

20 Feb 2024

Disclosure date

19 Feb 2024

As per section 1.4.2 (iii) of the Directive on Access to Information: "For Projects approved by Bank management where the Board of Directors has delegated the approval authority, the PSD shall be disclosed at the start of the relevant no-objection notification period to a member country of the Bank in accordance with Article 13 (iii) of the Agreement Establishing the EBRD."

Project description

Project objectives

The operation will enable the Borrower to develop, construct and operate the Project by financing the second solar PV power plant of 44 MW installed capacity

Transition impact

ETI Score:69

ected transition impact of the Project stems from Green and Competitive qualities as the operation will (i) generate 41,230 MWh annually of electricity, contributing approx. 36,902 tonnes of CO2 savings annually and (ii) deepen both competition and liquidity within the Estonian electricity market. The operation will be 100% GET.

Client information

KC SOLAR 2 OÜ

The Borrower is KC Solar2 OÜ, a special purpose vehicle incorporated in Estonia, established for the sole purpose of carrying out the Project. The Borrower is fully (100%) owned by the Sponsor, KC ENERGY OU, an Estonian renewable developer owning a portfolio of solar PV in Estonia. The Sponsor is a 50/50 joint venture between (i) Kaamos Group, an Estonian business Group operating in the real estate, construction and energy industries, and (ii) Combiwood Invest OU, an Estonian wood processing company.

EBRD Finance Summary

EUR 22,000,000.00

Total project cost

EUR 34,976,000.00

Additionality

The project demonstrates strong additionality by supporting an innovative project structure in the renewable energy sector in Estonia, which will be implemented on the basis of a fully merchant exposure. In addition, the Borrower seeks use of EBRD expertise on higher environmental standards, above 'business as usual'

Environmental & Social Summary

The Project is Categorised B in line with the EBRD's 2019 Environmental and Social Policy (ESP) and due diligence has focused on risks and impacts associated with the construction and operation of a 44 MW PV plant and an underground-line connection (approximately 4 km). ESDD was carried out by a third-party consultant and included a visit of the Project site and the preparation of an E&S assessment report, Non-Technical Summary (NTS) and Stakeholder Engagement Plan (SEP).

Results of ESDD have identified that key risks and impacts are expected to be concentrated at the construction phase and include occupational and community health & safety, traffic management, labour and working conditions, as well as dust and noise. Enhanced Supply chain due diligence is on-going for the solar components to be supplied for this Project. The satisfactory completion of the due diligence will be required prior to commencement of EBRD's disbursement of the loan to the Project.

The Sponsor already has some ISO-certified Environmental Management System in place for its construction business. It will be required to develop a complete Environmental and Social Management System at corporate level and corresponding Environmental and Social Management Plan (ESMPs) for the Project. The management plans shall be fed by the impact mitigation measures outlined in the E&S assessment will be implemented by the Borrower, contractor and subcontractors. The Sponsor will be required to appoint dedicated E&S resources for the Project and maintain adequate capacity to implement and monitor the Management Plans during construction and operations. The HR policy, already in place at corporate level, will be cascaded to the whole Project workforce, including contractors and subcontractors. The Sponsor will be required to develop a Health & Safety policy covering both workers and communities, and an Occupational and Community Health and Safety Plan. A traffic management plan and emergency procedures will also be prepared. No EIA was required for the Project, and relevant permits have been obtained prior to construction.

The Project will use low levels of resources. There will be no emissions to air and limited wastewater generation and water use (welfare and hygiene only) during the operation of the plant, and specific procedures for handling, storage and disposal of hazardous and non-hazardous wastes will be including in the management plans. A decommissioning plan will also be prepared, setting out basic commitments for safe decommissioning of the site and site restoration to satisfactory state as required by relevant local legislation, permit conditions, and good international practice.

All of the required land parcels in Pihlaka for the solar park were acquired through willing buyer-seller agreements. Part of the site is currently under agricultural production on the basis on a rental agreement, which will be terminated before the start of the construction. No other housing or economic activity, formal or informal, are present on site nor along the cable routes and as such, no Livelihood Restoration Plan is needed for the Project. As the land has already been altered for agricultural purposes, impacts on biodiversity are low. Specific measures will be however implemented through the ESMPs to further mitigate residual risks of disrupting non-critical biodiversity. While no evidence of cultural heritage has been identified, a chance procedure will be developed on site on a precautionary basis.

While early engagement with the authorities and adjacent communities has been provided by the Sponsor, the Stakeholder Engagement Plan including a functional grievance mechanism will be further implemented by the Sponsor through dedicated resources in the Project Implementation Unit.

The Project has undergone sustainability proofing assessment in line with the requirements for the InvestEU programme, as specified in the technical guidance on sustainability proofing for the InvestEU Fund.
An ESAP has been developed for the Project and including the actions noted above and will be agreed with the Sponsor. The Stakeholder Engagement Plan and Non-Technical Summary will be disclosed by the Sponsor in English and Estonian. Kaamos Energy will be required to report annually to the Bank on E&S performance of the Project and ESAP progress and the Bank will monitor the Project through review of these reports and site visits if required.

Technical Cooperation and Grant Financing

The project is expected to benefit from a first loss guarantee provided by the European Union under the InvestEU Programme, specifically under the EBRD General Debt Product and the Sustainable Infrastructure Window.

Company Contact Information

Mart Peling
mart.peling@kaamos.ee
https://kaamos.ee/?lang=en
Kaamos Group OÜ Veskiposti 2a, 11624 Tallinn

PSD last updated

19 Feb 2024

Understanding transition

Further information regarding the EBRD’s approach to measuring transition impact is available here.

Business opportunities

For business opportunities or procurement, contact the client company.

For business opportunities with the EBRD (not related to procurement) contact:

Tel: +44 20 7338 7168
Email: projectenquiries@ebrd.com

For state-sector projects, visit EBRD Procurement:

Tel: +44 20 7338 6794
Email: procurement@ebrd.com

General enquiries

Specific enquiries can be made using the EBRD Enquiries form.

Environmental and Social Policy (ESP)

The ESP and its associated Environmental and Social Requirements (ESRs) set out the ways in which the EBRD implements its commitment to promoting “environmentally sound and sustainable development”. The ESP and the ESRs include specific provisions for clients to comply with the applicable requirements of national laws on public information and consultation, and to establish a grievance mechanism to receive and facilitate resolution of stakeholders’ concerns and grievances, in particular, about the environmental and social (E&S) performance of the client and the project. Proportionate to the nature and scale of a project’s environmental and social risks and impacts, the EBRD also requires its clients to disclose information, as appropriate, about the risks and impacts of projects or to undertake meaningful consultation with stakeholders and consider and respond to their feedback.

More information on the EBRD’s practices in this regard is set out in the ESP.

Integrity and compliance

The EBRD's Office of the Chief Compliance Officer (OCCO) promotes good governance and ensures that the highest standards of integrity are applied to all of the Bank's activities in accordance with international best practice. Integrity due diligence is conducted on all Bank clients to ensure that projects do not present unacceptable integrity or reputational risks to the Bank. The EBRD believes that identifying and resolving issues in the project assessment and approval stages is the most effective means of ensuring the integrity of Bank transactions. OCCO plays a key role in these protective efforts andhelps to monitor integrity risks in projects post-investment.

OCCO is further responsible for investigating allegations of fraud, corruption and misconduct in EBRD-financed projects. Anyone, either within or outside the Bank, who suspects fraud or corruption should submit a written report to the Chief Compliance Officer by email to compliance@ebrd.com. OCCO will follow-up all matters reported. It will review all matters reported. Reports can be made in any language of the Bank or of the Bank's countries of operation. The information provided must be made in good faith.

Access to Information Policy (AIP)

The AIP, which entered into force on 1 January 2025, sets out how the EBRD discloses information and consults with its stakeholders to promote better awareness and understanding of its strategies, policies and operations. Please visit the Access to Information Policy page to find out what information is available from the EBRD website.

Specific requests for information can be made using the EBRD enquiries form.

Independent Project Accountability Mechanism (IPAM)

If efforts to address environmental, social or public disclosure concerns with the Client or the Bank are unsuccessful (for example, through the client’s project-level grievance mechanism or through direct engagement with Bank management), individuals and organisations may seek to address their concerns through the EBRD’s Independent Project Accountability Mechanism (IPAM).

IPAM independently reviews project issues that are believed to have caused (or to be likely to cause) harm. The purpose of the mechanism is: to support dialogue between project stakeholders to resolve environmental, social and public disclosure issues; to determine whether the Bank has complied with its Environmental and Social Policy or the project-specific provisions of its Access to Information Policy; and where applicable, to address any existing non-compliance with these policies, while preventing future non-compliance by the Bank.

Please visit the Independent Project Accountability Mechanism webpage to find out more about IPAM and its mandate and how to submit a Request for review. Alternatively, contact IPAM by email at ipam@ebrd.com for guidance and more information on IPAM and how to submit a request.

Environmental and Social Documentation is not available for this project.

Selected procurement notices related to this project may be shown below. Further procurement opportunities related to this and other projects, if available, maybe be viewed in the EBRD Procurement Portal.

The EBRD's Environmental and Social Policy (ESP), Access to Information policy (AIP) and Project Accountability Policy (PAP) enable sound and sustainable development in its projects. The Independent Project Accountability Mechanism (IPAM) deals with complaints about environmental, social and disclosure matters related to the Bank’s investments.

No complaints about this project have been made so far.

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KC Pihlaka Solar PV

Overview

Project timeline

Company Contact Information

Project description

Project objectives

Transition impact

Client information

EBRD Finance Summary

Total project cost

Additionality

Environmental & Social Summary

Technical Cooperation and Grant Financing

Company Contact Information

PSD last updated

Understanding transition

Business opportunities

General enquiries

Environmental and Social Policy (ESP)

Integrity and compliance

Access to Information Policy (AIP)

Independent Project Accountability Mechanism (IPAM)