Information

This is an official funding.

Contact

Richard Willis
EIB

Seychelles Water & Sanitation (EIB)

[ tags: Africa , Seychelles , Co-financing , Grant , Loan , Adaptation , Multilateral , Tourism , Waste Management , Water , Co-financing , Water , Co-financing , Waste Management , Grant , Water , Grant , Waste Management , Grant , Water ]
Snapshot
Financing Types Stakeholders Amount Share Sector
Co-financingEIB loan to Government on-lent to developer€26.7m49%Water
Co-financingAFD loan to Government on-lent to developer€10m18%Waste Management
GrantGovernment of Seychelles€14.1m26%Water
GrantEuropean Development Fund€2.4m4%Waste Management
GrantAfrican Water Facility€1.4m2%Water
Total:€54.6m
Project Summary

Seychelles is suffering from water scarcity due to the concentration of rainfall in a short period within each year, its variability across different years, little groundwater availability and limited opportunities to expand storage capacity necessary to transfer water resources from the wet to the dry season. Therefore, the water supply system is highly vulnerable to meteorological conditions, which may be aggravated by greater rainfall variability linked with global climate variations. The underinvestment in water supply infrastructure has generated a decline in water service quality and in the efficiency of their provision, with high water losses and energy consumption. Sewage collection and treatment facilities are also very limited, posing a high threat to both public health and the environment.

The project consists of four parts:

  1. Renewal and expansion of the water supply systems on the 3 main islands of Seychelles to cover water deficits, improve water and energy efficiency and increase resilience to climate variation;
  2. Upgrading of the existing sewerage system on Mahé island, and the creation of new sanitation facilities on La Digue island to reduce the risk of contamination of groundwater used for the production of potable water;
  3. Implementation of water demand and resource management programmes including environmental and natural disaster risk management;
  4. Capacity building of the promoter through technical assistance and the provision of tools to implement and operate efficiently the water and sanitation facilities.
Financing

The project was funded through a combination of debt financing via the European Investment Bank (EIB) and Agence Française de Développement (AFD), grants from the European Development Fund and the African Water Facility, and Government / Promoter own resources, as detailed above.

Lessons Learned

As this is an on-going project, lessons learned will be posted upon project completion.

The promoter will develop the project with an innovative approach focused on water and energy efficiency, thus contributing to climate change mitigation through significant energy savings in desalination plants and an energy audit of the overall water and electricity systems, adaptation to climate change and natural disasters, and water resource management.

Key soft project components such as water resources and demand management programmes, energy auditing of water and electricity infrastructure, systems to improve responses to natural disaster (tsunamis, floods and landslides) and promoter’s capacity building through technical assistance will provide an innovative and holistic project approach. The project is designed in two phases to take into consideration both the relative urgency of works and the need to set up a system that ensures the financial sustainability of the promoter before costly wastewater management investment is undertaken, whilst in parallel giving the promoter the opportunity to develop itself as an organisation.

Government of Seychelles has demonstrated its commitment to achieving cost coverage in the utilities sector through subsequent tariff increases following rises in fuel costs, and the recent completion of a comprehensive tariff study.

Public Utilities Company (PUC) will establish a project management team staffed by in-house skilled staff and support of external experts. The project management team will have the potential to develop itself into a fully-fledged asset management division as the project progresses.

The project will be implemented over the period 2011-16 and all the facilities are expected to be fully in operation in 2017.

The promoter, Public Utilities Company (PUC) is in charge of the provision of electricity, water and sanitation services to the whole country.

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