Armenia receives grant from EBRD to light up city of Gyumri

The European Bank for Reconstruction and Development (EBRD), the Ministry of Finance of Armenia and the Municipality of Gyumri have signed an agreement to allocate a grant of €2 million to support an ongoing EBRD investment in modernizing roads and street lighting in the city of Gyumri.

In May 2016, the EBRD committed €22 million to finance a road and pavement rehabilitation programme in Gyumri, the second-largest city in Armenia. The financing funded the rehabilitation of the city’s major streets, as well as the modernization of its street lighting system, which was achieved by introducing new energy-efficient technologies.

The E5P grant will support the EBRD loan of €4 million to make the lighting system in Gyumri more energy efficient and environmentally friendly. The refurbishment will introduce new energy-efficient LED lighting, a control and monitoring system, new poles and power cables.

This will reduce energy consumption and minimize operating and maintenance costs, resulting in better service quality and improved environmental standards. The new LED lighting is expected to cut the cost of energy consumption significantly and will result in annual electricity cost savings for the municipality.

Gyumri, located some 125 kilometers north-west of Yerevan, suffered a major earthquake in 1988 which left the city in ruins. Gyumri has since been rebuilt and is an important economic center of commercial significance and touristic appeal, which will be further enhanced by an improved urban infrastructure. The project will create jobs and help the 146,000 inhabitants of Gyumri and visitors enjoy better, safer streets.

Dimitri Gvindadze, EBRD Head of Yerevan Resident Office, said: “This project will improve safety and quality of life in Gyumri. We are grateful to our partners, the EU and all contributors to E5P fund, for supporting us in this important project”

The E5P supports Armenia with a pool of grants of €23 million. The European Union (EU) is the largest contributor to the Armenian window of the E5P fund, with a contribution of €10 million.  Other contributors include: the Czech Republic, Denmark, Germany, Lithuania, Norway, Poland, Sweden and the Taiwan Business – EBRD Technical Cooperation Fund. Armenia is both a beneficiary and a contributor, having contributed €1 million.

The grants help Armenia improve energy efficiency, contributing to energy security and economic competitiveness, while having a positive impact on the environment. The Head of the EU Delegation to Armenia, Ambassador Andrea Wiktorin, commented that “energy efficiency and renewable energy are the EU’s priorities in Armenia; the EU’s contribution to this programme shows its willingness to help Armenians foster their energy independence”.   

The E5P is a €220 million multi-donor fund initiated during the Swedish Presidency of the European Union in 2009. The main objective of the E5P Fund is to use grants to leverage loans dedicated to municipal infrastructure projects, for example the rehabilitation of water and wastewater systems, solid waste management, street lighting and the insulation of public buildings, combining a strong commitment to reforms and policy dialogue.

Transport, energy and the environment are areas covered by the EU-Armenia Comprehensive and Enhanced Partnership Agreement (CEPA). As part of the CEPA implementation, the country has the ambitious goal to align its legal framework with the EU energy law.

The E5P Fund in Armenia has been recently extended until the end of 2029. Moreover, in 2019 the EU launched the High Level Energy Efficiency Initiative so that the EU and international finance institutions can step up cooperation for large-scale energy efficiency measures.

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