More than 160,000 household users from the municipality of Chisinau, connected to the centralized heating system, risk not being supplied with heat this winter if SA Termocom is liquidated at end-December, when the insolvency period expires. In a press club meeting, Abdoulaye Seck, director of the World Bank (WB) Representative Office in Moldova, said such a scenario can be avoided if Termocom merges with the thermoelectric plants CET-1 and CET-2 to create a new company, IPN reports.
The WB official said Termocom is in a serious situation. The company accumulated debts of about US$138 million to its suppliers - CET-1, CET-2 and Moldovagaz. It happened because the tariffs are under the cost recovery level. The lack of funds needed for modernizing the energy system of Chisinau municipality brought the thermoelectric plants in a deplorable state, while the number of leakages is ten times higher than in the neighboring states. The existing problems endanger the energy system and security of Moldova.
Abdoulaye Seck stated that WB experts worked out a project to improve the efficiency of the centralized heaing system. The project has three main components. At the first stage, the World Bank will lend US$34 million to Moldova for performing urgent works to repair and replace the old pipes and pumping systems. The individual central thermal points will be replaced and the dwellers will be able to monitor the heat consumption themselves. The economic effect of these investments will be the saving of about US$8 million a year.
The second component envisions investments of US$5 million for supporting the halt in the operational activity of CET-1. Within the third component, US$80 million will be allocated for refinancing the debt of US$138 million.
Shinya Nishimura, senior energy specialist of the World Bank Delegation in Moldova, said the investments in the rehabilitation of the heat pipes should have been made five years ago. Termocom is in a state of insolvency and if the Government and the Chisinau City Hall do not find a solution, the company will be liquidated. The liquidation will be a long-lasting process that will benefit no one.
According to Shinya Nishimura, many international financial institutions expressed interest in investing in the restructuring of Moldova’s energy system, but they want guarantees that the sector will be safe and the company will be sustainable from financial viewpoint. The WB experts asked the Government to immediately approve the Law on the Energy Sector so as to ensure transparency. Consultants of the World Bank are working on the structure of the new company’s corporate governance, and the executive will have to propose a candidate for the post of director. The foreign experts demanded that the director of the new company should be selected according to performance criteria, not based on political interests. The experts do not rule out that a foreign manager may be brought to administer the new company.
