MOLDOVA ENERGY AND BIOMASS PROJECT Project Phase II (EaPic top-up) 214.2097 Annex 1: Description of the Action Implemented by: United Nations Development Programme_X1 Title Moldova Energy and Biomass Project I X.2Beneliciary Country ‘The Republic Moldova 4 Contracting Authority ‘The Eurepean Union represented by the Delegation ofthe European Union to the Republic of Moldova 1X5 Costof the Action Toial Elgiie Cost of the [Amount requested om The | or ota etgibo cost of acti ation Contracting Authority eee eee en Project Phase 1'810,703.50 | 840,708.60 00% 1. BRIEF DESCRIPTION “The Moldove Eneray and Blomass Project alms to contibute to 8 more secure, competitive and otainable energy production in the Republic of Moldova through targeted support to the most ‘able and reac avalable local source of renewable energy, namely blomass from agricultural Wastes. consists of 4 inferelated. outputs: 1: Municipal biomass heating and fuel ‘Suppiviechnoloay markets established, 2: Foundations [ad for establishment of efficient biomass: Based household heating and heat supply markets estabisnes and private sector demand promoted: 3 Capacty fr local growth of biomass markets at regional and local eves is bul; and Te the opportunities and benefits of biomass energy for Moldova are well known locally, ond Viol of project results promoted. End 2014, after 4 years of project implementation, based on highly satisfactory project performance, lessons Teamed and cleat identified gaps and adeltonal needs to support futher Frarket consolation the project entered @ second phase unt end 2017 with aditonal funing of 91410,703 50 millon EUR allocated by the European Union in the framework of the Eastem Parinershig Inlogration and Cooperation (EaPIC) programme, “The second phase will foous on development of local biomass market and general market onsabdtion ofthe bomase-elated business through continued suppor to solid biofuel producers ‘Shu suppor to local biomass boler production and extension of Public Private Parinrships for Sctabising. sustainable biomass based heating services. Support to installation of biomass heating systems wil be further provided and extended to small and medium-sized towns, ATU Guysutio’end Taraclia cltnct and Traneniata region. To provide intarated energy saving and Gffcteney souttons fo project sites, combined technology solarfbiomass in puble buildings wil be veloped and piloted.TABLE OF CONTENT 1 sar orscmeTion, - sia a NARRATIVE SUIIARY OF OBIECTHES AND OUTPUTS en = 4 (Onuscnves ano OUTPUTS o= MEBP Prk a ~ oes, IL STUATION ANAL, ee os "Thame EER HOM HOURS ACTA WATE) a : 6 usteaTecy i a 2 ‘OUTPUT: MUNCIPAL BONS HATING AND Fuk SPP./FECHLOGYMaTS STABLERED (WORK PChACE I] a5 ‘Acti 1.480 eating stems ond 20s0ar hot wate ater noble balgn salen ra ‘Aetnty 1.2: Fel ec focitated though lesing/irepurchore mechani or cl fuel apy 18 ‘Aci 13: Maret enronment enhanced to supper qual, efeny ond efetivenes ond furthered onaldetion supported nn = ao a) ‘ur Fomoxnon 0 Fonsi cE MRED EATING AND Wn SePt mas TaD se sicronesuan nOwOTE (one rseas 2). Soon: -Actity 2.1: Market solutions for high efficiency affordable ruol biomass household heating identified and piloted : = oe coos ‘Actty 22: Market solitons or iomas based het supply enc: n pb bling developed 2s ‘Act 23 fen’ and sustinabie biomes burning feces fo production paces pleted onde ote of rousehod eve reir expoed eae ‘urrr3. canner sexs rn enn or Dons i tn SN LOCA Ls woe oes 3) ‘Actity 34 Copacty of municipal leaders to manage Homes spsters ean 28 ‘Acti 32: Capcty fo sound operation of tama uring bas developed. os ‘Act 33: Comprebensve baring modes fer commer fuel supe prded a0, ‘Act 34 Commit understening and acceptance of ames energy enhanced ough shoal cdicatonl ‘Acti 35: VET for rnewobie nergy scr pfonal odced aon QuTPaT 4: THEOPFORTUNTES AN BENEFITS OF BOMASS ENERGY FOR MOLDOVA AE WANG, VILY OF POI EATS MMOH WORPAASE Aon enonnrieennrne 3 “ct 1: Meda campaign. Bi ~ 3 ‘Activty42: Annual nator owas = ws ‘Aetity 43: Communication an silty of roe akan = as NRESULTS AND RESOURCES FRAMEWORK ae ee V.ANNUAL WORKPLAN... - . a \VuMANAGEMENT ARRANGEMENTS, so eo 2 eee. ‘Avs A~ Dart SELECTION CRTDRA TOBE APPLED UNDER CTI Ise a ae ‘amot8~CAcduron or Bout eATNGSTEMCOS cacao ax -Roc Are, ~ ern ee ‘ae 0 ~ Ds Tms or Rn ot PRONG Sa = = ena!Narrative summary of objectives and outputs ‘The Moldova Energy and Biomass Project, funded by the European Commission and implemented By UNDP aims to contbute fo a more secure, compelive and sustainable eneray production in the Republe of Moldova through targeted support to the most viable and readly avalible local Source ofrenewable energy. namely Biomass fom agricultural wastes, Brief overview of MEBP Phase I: ‘The project purpose wes lo Increase the use of renewable energy technology signfcanty through {al ewitering and energy efcleney. The project primary focused on improving heating comfort levels inural publi sector bullings including schools and community centres by using readly ‘valable waste straw supplied from local agricaltural enterprises. The phase | also stimulate local markets for mproved household heating, industal cogeneration, and biomass-based Brgueting, [3 well s raise local eapacty in te biomass sector, and promoe the benefits of biomass energy andthe project. Phase If the project consisted of fur interrelated outpus (work packages) as flows: © Output 1: Municipal biomass heating and fuel supply markets established (work package 1) aimed to improve muniipal heating of publc Buldings in rural areas and estabish Fated uel supply markets. Under this oUfput over 140 thermal heating systems were installs {or the provision of heating for pubic buildings in rural communities in Moldova (indicative faclvly 11), Supporting this, market mechanisms were used to support the involvement of toca! Ue suppbers to prepare, store and supply the fuel needed for the installed heating plants {actvty 1.2) Very focused low-cost actions on policy, regulation, and contracting to Support the market environment made a trd output under output 1 (activ 1.3), «Output 2: Foundations lad for establishment of efficient household heating, industrial Cogeneration and biomass briquetting markets (work package 2) focussed on three Gmerging technology oplone for biomass energy in Mokdova, which were assessed, ‘Sovebped, nd plotes, Actty 2.1 focused on domestic heating in rural areas, adsressing the ‘need for improved effeleney of heating and possibly cooking. Activiy 22 supported the ‘Seplyment of ndustal co-generation based on foodstocks from agrtindusiry, and acviy 2.3 piloted and demonstrated PPPs for heating service provision. = Output 3: Capacity for growth of biomass markets at regional and local evots is bult in Moldova. (work package 3) slmed to ensure that the benefis of biomass eneray ‘Semonstvaled and deployed under outputs 1 and 2 are delivered ina lasting and long-term ‘nay and that local capacities for further replicaion Is ensured. For each stakehokier typo to be Feached under output 3, the fret step was the development of training materias, placed inthe pubis domain, These materials, updated and improved each year, provide an accessible Feposion of Key Information, and are used ether in the training to be deivered under outputs $Ta'2 or in sub-actvties under oulput 3, The stakeholders targeted include: municipal nanegement including mayere, cv servants, and teachers; saw-red boler operators; fuel ‘super: and school ciren, © Output 4: The opportunities and benefits of biomass energy for Moldova are well known focaly, and visibility of project results promoted (work package 4) facitated widespread Sseeinaton on the general and specific advantages and impacts of using biomass energy in Molcove. A communseaton and vsibity plan was elaborated and agreed between the EUD ‘Sad NDP and implemented in view of promotion of the vsiilty of project results and positive Impacts of the parnership.Objectives and outputs of MEBP Phase I In 2014 the project entered a second phase in the framework of the Easter Partnership Integration and Cooperation (EaPIC) programme, based on ts continued high relevance, excellt Performance and the clearly identified need to further support the consoldation af the emerging Biomass merket in the country, The timeframe for the second phase is until end 2017 with ‘adaltional EU-funding of 9,410,703,50 EUR. ‘The main objective of the project's second phase isto scale up the successful actives and {xond them to so far not covered or underrepresented regions, specticaly Transnistia, Gagauia ‘and Taracia, and to suppor the further consokdation af the biomass marke To achieve these objectives the focus of EaPIC top-up actviies under the existing project outputs, willbe the folowing: ‘+ Output 1. Municipal biomass heating and fuel supply markets established This component will aim at instaling at least 80 addtional biomass-based municipal heating systems in Moldove, with focus on Transnistria, ATU Gagauzia, Taracla disct ang emall tue {An inezeased focus wil be on the further development of the domestic biomass ual market in view s, ceifcation of preducts and end-consumer protection. Integrated renewable, energy and energy efficiency solutions willbe pbted to demonstrate the eultabily of modeen biomass, based heating systems for small owns ‘+ Output. 2. Foundations laid for establishment of efficient household heating, Industrial cogenoration and biomass briquetting markets Under output 2, a least 100 households andlor small businesses wil be supported to procure and instal modem and effeient biomass bolers under preferential condlons, Fechrical and fnanclal ‘suppor il be provided forthe creation of 7 new PPPs throughout the country fo fosor PPPs for {establishing sustainable biomass-based heating services and efficient operation and maintenance ofthe systems, * Output 3. Capacity built for growth of biomass markets at regional and local lavels ‘The capecity development activities will continue to be a key element of the component being tailormade and extended to cover Transnistria, Gagausia and Taracla distiet ae wel as einal towns and include solar energy as new element LPAS, faclity managers and boiler operator il Continue to receive technical training on management of biomass heating systems, The vocational ‘2ducation and training (VET) sector wil be addressed in view ofa consolidated efor Io equip the \Modovan labour force in support of the emerging markets and technelogies. The school education ctvties on renewable energy and energy efiiency, especialy the Bioenergy Summer Camps, wil be extended to smal towns from Moldova, Tarala district, Gagauzia and wherever fasibie “Transnitia, ‘+ Output 4, The opportunities and benefits of biomass energy for Moldova are well known, visibility of project results is promoted Wide-sproad awareness raising activities onthe opportunites and benefits of biomass energy wi be further fecitates, with a specific focus on increasing the uptake of renewable, onergy technologies in ATU Gagauzia and Taracia cisvct, and Transnistia Region, and wy of toe Partnership and impact of the acon wil be effectively promoted.(i N._ SITUATION ANALYSIS “The Republic of Mokova is highly dependent on energy imports. About 97% of Moldova's eneray reeds (oss fuels and electaaly) are imported, all from Russia and in adsiton there are lege ‘cumulated debts. Whereas petal and coal sources have been sighiy diversified in recent years (Russia, Utraine, central Asia). natural gas, the main source for heating, is almost 100% imported {fom Russa. According to the Natlonal Bureau of Stalstcs, in 2007 the county hes imported 1922 0001 carbon equivalent of natural gas, as compared to 122,000t of own sources fuels. import prices ale sing steadily. towards world levels, imposing a severe burden on tho popuation and the economy, The eneray sector ts Key to the Moldovan economy and thus is vital to the tuccoeell Implementation ofthe national ecanemy development programme. “Thermal Energy fom biomass agicutural wastes) “The total population 8s of January 2008, was around 3.5 milion, of which 2.1 milion (69%) Ived in Turel areas” There are. 1.680 rural setlements In Mokiova (eluding Transnistia region and ‘Gagauzb), administered through G58 local administrations. Planned reforms wil resuit in the ‘edvetion of te numberof public administrations (Primaria), with devolution of fiscal responsisty {o local bvel. with conral responsibilty for ifrasbucture and national services including health and ‘educaten. Rural sattements, vilages and towns, are broadly similar in structure. Public buildings and partment blocks’ (ary) are located in the town or vilage centre surrounded by prvato Fousehels. Each household usualy has surrounding land / kitchen garden averaging in size Ground D.2iHa, Most householders (85%) also have a land entlement in the egrcutural and Surrounding a vilage (the former solace), on average 1.8Ha. Communal and reserve lands are Feld bye focal authority as are public and nor-prvatsed land, ponds and buiings Publ buicings (kindergarten, school, town hall, health ceive, bray, house of culture) are mainly peated by coal or gas. Surrounding prvaely eld houses mainly use biomass (wood as well a5 vrastes such as maize husks accounting fr Upto 70% of fuel used) and coal for heating and aor ‘8 for ooking, Households mainly use primitive and ineficient stoves, Many vilages in Moldova are conneced toa natural gas main, where buildings in thse areas can, at be cwmer’s expense, be connected to @ natural gas supply. Sine the rapid increase ir go prices connections have slowed very significant “The forest and woodland coverage in Moldova is low, with less than 10% of total land area The fationa arable sown area fs approximately 1Smillon hectares, accounting for 75% of land use. Jorculural lands surounding vilages average 1200Ha. Agricultural enterprises and individual {amiles culivate agricultural lands, for Rortcuture operations but predominantly for arable oroulure: cereals grains and olseeds are elements of annual arable rotations in every fettement, including winter wheat ‘On average 200Ka of winter wheat per settoment is grown annually generating up to 460tons {ratonsty 700,000 tons) of @ mainly unwanted wheat stam with an energy content of around $3000 (nationally 8.20073, equating fo about 8% of current national energy consumption) The tnwand saw is ener Chopped and incorporated during ploughing or, more frequenty burt in the fil (contrary to rogulation). “The avalabity of this straw biomass Is the basis of the renewable energy source underyna the (Joneratn of thermal energy for puble buldings. The average energy requirement for public Belsige in rral villages 1s the 50-5OOKWEh range, reauiin an average of 276tons of straw fuel, 2 quantty readily available fom surrounding fields. “hiss the main sloment of the rol-out ofthe Moldova energy and biomass project.In adation there are important considerations regarding domestic and agrLindustrial energy. Rural households use a considerable amount of firewood for heating, Households use wood and coal ‘heating, mainly from radiant stoves that also provide for cooking but do not provide hot water ot entra heating. {n overall terms wood use for domestic heating, national, i tkely to bein the region of 2 milion cubic metres per year (around 600,000 tonnes), @ proportion of which may be Hegally logged Moldova's forest resources are limited and the problem of legal logging ie considered a party of the forestry sector given negative environmental impacts of such logging, efforts are cumerly underway to understand and address legal logging in Moldova as part of the EC funded ENPI FLEG programme, The ENPI FLEG programme in Mokdova fs implemented by the Word Bank ang IUCN, To address pressure on forests from the domestic use of ea, and the environmental impacts of coal use, two strategies may be followed: 1) improving the efficiency of household stoves that Burn 800d or coal, and 2) providing alteraive fuels for household heating, such as briquettes made from straw, “The agro-indusrial sectors thus the core ofthe Moldovan economy and this industy and holds significant potential for future added value and growth. The food industry of Moldova comprises _about 280 enteroises providing employment for more than 26,000 people Since there's @ ‘ianificant need for energy, and arg-processing is eo mnportant tothe Moldovan economy, there should be significant potential for biomass based co-generation of heat and power basad on sod fue combustion or biogas using agr-processing wastes such as those from the wine indus, fut Processing, as well as husks, Kemels, dust, shelling, berk and timings. ‘Situation Analysis ~ update 3.5 years after start of project phase | In January 2013 the Government of Moldova approved the Energy Strategy until 2030, which envisages conerate steps forthe development of the energy sector In Moldove. It del with bjectves, measures and activities oriented towards a more efficent, competiive. and reliable national energy industry whilst ensuring the country’s energy security, the upgrading of eneray- ‘elated infrastructure, improves energy efficiency and use of renewable energy sources, and ts Integration ito the European energy market During the last 3 years, the structure of energy consumption in Moldova has changed. The residential sector has a slighty decreasing tnd, while the energy consumption in instr Is fogistering # growing tendency, In tis context, the agrosndustial sector remains the biggest ‘economic sector whichis also one ofthe major suppliers of raw material for biomass production, ‘There is consensus that agricultural residues are the Republic of Moldova's renewable energy source with the biggest short. to medium-term potent. According to experts’ estimations 21,092 ‘TJ can be produced from locally avaliable biomass, This mostly unused resource epresenis an ‘avaiable, substantsl and reliable source of renewable energy. Comparing the igure of biomass Potential with the domestic consumption of energy resourees in Repu of Moldova, which was, equal to 90.044 Ty in 2012, 29.3% of toal energy resouroes needs can be Covered by biomass: ‘uel. This fact is essential given that Republic of Moldova fs dependent an energy imports an the identified potontia may cover approximately 52% of natural gas import, BrainFe #: Src of energy coneumein by sare of sony, 2010-2012 Source Energy Bates of Moora ‘hto 2012 Natonl eo of Sotcn onesie) ‘The renewable energy. and specifically biomass-based eneray market hes seen a rapid owelopment over the past year, incl. through the targeted combination of supply and demand ‘Slo measures promoted by the Moldova Energy and Biomass Project. Over the fst 34 years of MEBP implementation (2011-2014), significant changes occurred on the [bcal biomass market. Along with implementation of over 140 biomass heating systems at public buikings having 2 toll installed capacity of = 30 MW, the private sector reacted wih a constantly Inoressng supply of required biomass fue. During the last 3.5 years, the numberof operational biomass businesses increased by = 10 tmes reaching a total number of over 120 (based on proect evidence). Ths postive dynamic was possible also due to the support of MEBP granted {hough 8 Revolving Fund establahed to offer local entrepreneurs adventageous conditions for launching sndior extending businesses In the feld. As the market for sold biomass fuels is ‘Gevelopng fast, this brings along an increased need for quality assurance based on standards fegulating qualiy requirements for different types of biofuels - a crucial step for an efficent ‘Sovelogment of the Moldovan biomass fuol Market. While the quantiy of supply is steadily \neveasing, the qualty ofthe fuel remains one of the issues of high importance being partially improved during this pried In this tense, The Ministy of Economy in cose collaboration with the National Instute for Standardisation and with MEBP euppor elaborated Solid Biomass Fuel Standards, vansposing 37 EU standards, and @ Technical Regulation, logaly adopted in 2013. These legal framework Changes produced the inal expected effects and started boosting the quality of supplied biomass, Infortaton requests about modes and modalities of determining the quay of procured fue, ot. Geaity nowover atl romaine an latus and firthee assistance Is requited to operationalize the {echnical regulon. In order to ensure enforcement and complance withthe new standards, 8 ‘qually contol and cerbfieation mechanism has to be put in place, requifng an authorized body Shkiled and equipped to test locally produced solid biofuels, as well = complementary capacty ‘eveiopment for fuel producers Being the biggest energy consumer in the total county balance, the residential sector has been {ected agamnet the opportunty of swatching to biomass heating systems through an incentive mechanism launched by MEBP. The registered feedback indicated a slower inital acceptance, of Serative sources of energy by local households. Combined wih a targeted awareness raising fort ‘nd simplification of he offered fnancial incentives, the demand started to significantly increase towards the end of 2074, proving for large potenti! fo futher upscaling ofthe started init.Staring 2012 the market was also tested for openness to a new development mode, whichis based on heating service provision using biomass heating eystems. The service, orgaized ab 2 Public Prvato Parnership, enables a private company to provide heating services to the public ‘sector. Being the main recommendation of a dedicated feasibly study, tne model is expected to be an example and offer @ solution for increasing the sustainably of investments ino modern Biomass healing systems, create premises for balanced market, Gevelopment trough Goatly Services, reduce risks of inappropriate systems management and consequently erease the Visibility and crecbilty of biomass as a susiainableallarative to foi fuels. A sound interes rom Local Public Adminisvations was rogisared in line with the proposed energy generation and ‘supply services to public sector, which provides clear indication of high repization potent ot the activity, While identiying ths fist PPP demonstration pilot under the ongoing MEBP, already 42 Raions hed submited Expressions of Interest to establish @ PPP in collaboration with a lool entrepreneur. Based on this the viability of PPPs as model for incwased sflectveness and sustainability wil be fuer demonstrated, contributing tothe overall biomass market development in Moldova. The pilot activiy however revealed limited practical understanding of the PEP mechanism and is value added, another limitation thst wil be addressed by the sotond phase of the project. The PPP approach also responds to another identiied gap, namely the, Emted vallabilly of maintenance and operations support and specialised consultancy services the Regions, While commercial briquette production je already well established, polting techniques are sti ‘only scarcely applied in sold biomass production. This goes hand In hand with repily growing domestic demand and export potential, pointing to the need for increasing supply to ensure ompetiion and avoid unfavourable price developments, The strategy adopted for phase therefore focusses on creating a transparent, welinformed market ~ both on consumer and Producer side, e.g. trough the development of comprehensive web platform connecing produoors ‘ith clients, systematcaly monitoring price developments and providing information to business (on latest technologies and business opportunites. Access to stuctured fnancing fr investments in fuel production equipment wil continue to be provided via Revolving Fund which was established during the fist project phase. Wile no new capital wil be added tothe Fund dung hase Il of the project, the Fund will remain operational and continue t0 stimulate business ‘evelopment inthe biol market. Further the market development approach wil expand to stimulate demand not only trom the pubic sector and private households, but increasingly foous on the commercial sector as Consumer of sold biofuels and biomass technologies, The application of biomass mil be pled in sectors with large replication potential and economic impact in rural areas, specticaly agroulture. ‘To ensure sustainabilly ofall project interventions, the welltested and comprehensive capacity development approach for municipal leaders, bulding managers, boler operators and fue! ‘supplies shouls continue inthe newly Hentiied tonne and target regions. More emphasis has {0 be placed on building the managerial capacities of bioluel producers and technology providers to fencure their continued competitiveness under changing market conditions. Specie allenion has to be given to the need for continuous training of baler operators and insttutionalzaton of a Aualiy canto framework in tie raga. Im aston, based on lessons learned from the wrk in beneficiary communities, more emphasis ‘shouldbe placed on integrated solutions and Energy Efficiency measures in buidings. Cureny, ‘most ofthe publc bulgings MEBP was working in do not have provision of hot water orf Oa limited to the kitchen area (in these cases mostly based on electricity). Most ofthe ullings are ot equipped with a dual piping system. While the Biomass heating systems could be expanded with heat exchangers and accumulation tanks to provide for hat water, complementing the bole with solar hot water systems is assessed to be the more suitable and cost efcent solution, The demand of hot water supply e.g. in an average Kindergarten in Mokdova (estimated. at 15 lires/personfsay) can be produced and covered with solar collectors. This wil pot only bing directsavings to the energy budget of the institution, but will also increase the comfort. heath and Senitary conditons for chidren and pupils in schools and kindergartens. ‘Based on the successful piloting of the educational inative in over 360 schools throughout Moldova (approx. 23,000 chien reached), and the high academic standards ofthe Manual and Teacher's guide developed wihin the project, stating with September 2013, the subject “Renewable Energy Sources" has been introduced inthe National Curiculum for 2013-2014 as an ‘optional subject. In such a way, In the coming years, any student from 8" to 8° grades troughout oldova wil be abe to elect the respective optional course, and the teachers choosing to teach it wil be doing 80 ageinet pay’. Such educatonalIntatives as the one designed and pilotod by MEBP enebles children to decame promoters of sustainable energy and new technolosis, Sharing their knowledge about how alternative energy sources can benefit the community and County they hve i with heifers, are ens, [A positive shit in perospion towards renewables and energy efiiency can be clearly witnessed fea resultof contnuovs and nation-wide communication and promotion activites undertaken by the project One major highght of the awareness rasing activites is the frst National Awards Competition “Moldova. Eco-Energetica’, organized at MEBP infiatve showcasing the best ‘achieverents in the area of energy effcieney and renewable energy sources. The key national implementation partners of the respective contest are the Ministy of Economy ané Energy Efficiency Agency which already assumed the ownership ofthe acy, thus ensuring its continuity fnd sustahesiy beyond the ife of the project. This Intatve succeeded to atract the donor Community and privto sponsors In acknaweding and promating te outstanding developments in the respective sector. {n relation to the geographic focus of the intervention, the experience accumulated during the frst 25 yeas of project implementation poins to the need to expand actives beyond rural areas ‘nd to place specie attention to regions so far nat covered or reached to a lesser extent. While the MEBP’s focus to date was on rural areas and communities, the feedback received from beneficiris and experts, revealed a high lavl of interest of small towns to install iomass-based heating systems within selected publ buldings. Small towns are facing similar challenges related {o securing affordable heat supply and technologies based on briquettes and pelts are equally Sutabl f urban environments, which however remains to be demonstrated in Moldovs. With a toll of ~2.169 TJ, the potential for biomass energy in ATU Gagauzia and Taracia is Significant both in regional and national comparison. A large and reliable source of raw materials Inthe regon ts futher one ofthe biggest surlower processing factories in Moldova, producing ‘ignicantquaniies of sunflower husk residues which are currently used onl in small quantities ‘or pelets production, Despite tvs high-potental, the MEBP saw a lower uptake of esssianco as {Compared fo other regions and increased efforis were required to reach out to communities and tnirepreneurs, To explot the ful potent further targeted awareness raising, demonstration and cthedty covelopment a required: neluding sth Involvement of Ci Society Organisations. The Stategte us wil contrbute to further advancing the socio-economic development of minority regions, and target women entrepreneurship. ‘Another osjecive of EaPIC project top-up is fo ncroase the use of renewable energy technologies ‘ond facie the development of a local market of eneray production based on locally available Sources through fuel switching and energy fcioncy in the Transnistrian region, the eastern reoion of Republic of Moldova stuated on the left bank of the Nistu River. EU engagement with Moldova end the Transnistria issue has also grown in recent years, The EaPIC project top-up is ‘also aiming at facitatng setlement of the Transnisrian issue through ensuring economic and * ovement gocsbna po. 679 0 of 7 Jy 209 rag. te Acyl or primary, secondary and hgh-schoot gatcaen fore ped 2018~2014 5 Chee an opona eet om te curcuamisslced by teacher each Ris emunesad a coe Se.‘0cial development of local communities, together with technical approximation inthe event of a signicant rapprochement between Chisinau and Tirespol, “Transnistria region faces numerous similar economic opportunities and challenges to those faced by the right Bank of the river. The main challenges include: an underdeveloped susiness Infrastructure; low competiiveness of products; defct in skilled labour, poor diversifalion of Industy: and high regional competion in attracting foreign investment. Fransnisblan desacto uthoriles are interested in addressing these economic challenges and supporting actvlse which Contribute tothe economic stably inthe region. Although, key economic ctors in the reson may be the most inlerested stakeholders in using the opportunities to partlpate in EePIC top-up 2ctivties in the region. It is therefore critcal that economic sector. particulary SMES in the “Transnistria region have access to information about new opportunites and ae supported by Poect activities which contribute to sustainable economic development. According te the date {allable ‘wih MEBP, there are no biomass processing enterprises in the region, However, ‘Transniste-based enirepreneurs exprossed thet Inlereat to start biomass provessing businesses with assistance from MEBP. Differences in the francal and custome systems between the to banks can pose some diffcutes inthe successful plementation of the activites, ‘The promotion of biomass-based heating In Transristia region will need to take into account the intense gasification of the region, on one hand, and the Russia-subsidsed price forthe natural ‘388, onthe other hand, Ways to simulate the intert lowards blomase need 10 include a lagoled promotion ofthe proect especialy the remote areas ofthe region nol yet connected fo the ges etwork, a8 wel asthe promoton of integrated biomass and hot water soler solutions, Based on the information provided by the Ministry of Education of the Republic of Motiova, 8 ‘schools from Transnistria region are unde th jusdton of the Moldovan educational auras Provided some of these schools would be selected to benef fom MESP assistance dung th Projects second phase, the same approach uth regards to te implementation of the educational Initatve on RES and EE applied during the fst MEBP phase wil be applied. ‘The schools ‘subordinated to the deacto educational authors from Twaspol have a distinct curicubm and demonstrate a limited openness towarts new ideas and educational approaches. The respectve set-up can pose challenges in implementing educational and awareness acini in the schools similar tothe ones implemented inthe first MEBP phase in target communites ftom Moliova, A way to motivate the schools to partcipale will be the jint Bioenergy Summer Camps where ehldren from both banks, including Gagauzla region wl join together to learn about the benefits ‘of renewable energy forthe communities they ve and the environment as whole Continuous dialogue with the Transnistian counterparts across all project actives wil be crucial for the successful deployment of any intatves envisages forthe respective region ‘The transition to new biomass heating systems implies changes in altitudes and behaviours. In ‘rder to be successful in replacing fossi fuels with renewable sources in Transnistria rogn, there is @ need to cary out a local meta campaign focused on actions and massages sultable fr the target audience needs and expectations. Gen the fact thal the media rom Transnistria reton ae Controlled by local authori, the journalists can demonstrate @ limited openness to promote the benefits of the renewable energy and the resuls ofthe project actives on the region. The projec. wil address these risks by maintaining an open dialogue with relevant stakeholders and mecia, ‘and working closely with local media, Rationale for UNDP involvement LUNDP is well placed to implement the Moldova energy and biomass project due to several factors that give assurance that the project wil be successfull Implemented: over the past yoars of work at local levels, UNDP has gained wide expertise, resources. and knowledge related to the ‘substantive and managerial aspects as well as regarding colaboration with Local Buble Authorities: * Since 1982, through numerous projects, UNDP Moldova has reached wide presence and has developed considerable knawiedge on the stustion and expertise in working at the "local and regional level, Welkestabshed partnerships are in place together with the Capacity and mechniams fo effesenty deliver assistance atthe local evel + nthe framework ofits environment and energy pregramme, UNDP Moldova is supporting the county's tansiton to low carbon and climate resilent economies and ecosystems: \thich involves the promotion of energy efficiency and renewable energy sources, both at the level of policies and the lvel of concrete interventions on the ground. ‘+ From the project management perspoctve, UNDP Moldova has effective structures and provedures.{o ensure resuts-based management and delvery, eluding extensive Cxperonce with implementing local development, sal-govemment and partcpstory projects = In terms of capactias, within UNDP and specifically within the Joint integrated Local Development Programme (JILDP), the tgam includes wellexperienced management and professional community mabilzation experts and engineers. The team so brings along Extensive knowledge and experience acquired through strong involvement in different ‘Stages of implementation of the fist biomass plot projects in Moldova, ‘+ UNDP has very good working level relations with consultants and experts from throughout Moldova and experts within JILDP with experience in appraissl and implementation of biomass projects in Modava. This also provides enry points for exchanges of experience, best practioas and lessons learned from previous pilot projets. “+ The UNDP country office, including is operations unit is highly experienced with large scale procurement and recutment at national and international level + Addtonaly, UNOP Moldova brings to this proposed project nat ony its own expertise and opacity, but also the experise, knowiedge and best practices from the region, made Svallble trough the Regional advisors and service centre and collaboration with other UNDP offices from Cantal and Easter Europe and CIS countries. In the 3.5 years from the start of project phase | implementation in 2011 to end 2014, UNDP proved. to be very. instrumental In successfully implementing, the MEBP activities. All Implementation mechanisms are well functioning and this made the MEBP a wel-known brand in the whole country. The MEBP has very good interaction withthe main national stakeholders and Intemational donor agencies active in energy sector. Also, there is close cooperation wih local and ‘eginal authores, community based orgarizatons, entrepreneur ccles and other community leaders, whe play a rue oe inal community initiatives, 2WL Stearecy [Ata corporate inal, UNDP's goal i to strengthon national capacities to manage the suviuenient in a sustainable manner while ensuring adequate protecton of the poor. Spoctc focus le glven Oa biting locel capacity to better manage the environment and deliver services, especially water ‘and energy. Over the past 15 years, UNDP assistance in environment and energy nes evolved from supporting technology demonstration projects to promoting market “development for ‘envronment-endly technologie. Expanding access to environmental and energy services for the poor is a key target, recognizing that those are essential for poverty reduction and economic growth, UNDP's eetviies Pluss Insttuional capacity development to scale up energy service celvery to ensure nationwide overage. This is especialy important at the local level since service delvery is increasingly ‘decentralized to local publc authorities. UNDP assists local authors in bulding the capacity of local agents including communities, non-governmental organizations, micre, small and medium Sized enterprises, financial institutions and other private sector actors to manage and stimulate business an development benefits rom environmental and energy service Gelvery ‘The projec i inline with UNDP. Moldova county programme which sets “Regional and Local evelopment” and “Energy and Environment’ as key areas of UNDP-Government cooperation ‘The United Nations = Republic of Moldova Partnership Framework 2013-2017 (UNPF) and the associated Action Plan voice the collective determination of te United Nations to support Moldova: in tacking environment, climate change and disaster risk management isues. In these flde, the work of the UN suppers central and local authorities in promoting low emission econome evelopment end susiainable consumption, specifically n using renewable energy sources and Increasing energy efcency. Inline with this, already ongoing UNDP work promotes eustainable eoonomic and environments {development and improved living conditions atthe community level aiming at reduced Income poverty by promoting income, employment creation and improving the local Business envinenert and as well as at reduced negative ecological impact by promoting energy efficency. and improving enviconmental cnditone. Bioeneray requires special support mechanisms that go beyond those for other renewable ‘energies because: © White the combustion technology presents some challenges to market evelopment, the creation of a sustainable biomass fuel supply infrasbucture bighiy complex and especialy challenging 1° Blomass fuel supply chains are essential fo eustainable biomass energy use © Fuel supply touches on multiple sectors ~ forestry, agricufture,industy, public sectoriservices (district heating), environment, and energy ~ and tis adds to the ‘complexity of arranging fuel supply (© There are competing uses for raw materials that are developing parallel to those of biomass fuels, © Smal fuel supply markets are highly volatio, and this increases inal risks for investors, unl the markets have matured © Market tees, such a8 places were one can ind and compare offers from mutiple ‘suppliers, ar lacking In Biomass fuel supply © Biomass heat is a signficant opportunty, and can offer substantial benefits, but ‘most renewable energy polices have focused exclusively on electricity (wth heat a8 a by-product, occasional). 1 Project objectives ‘The overall objective is to contribute to @ more secure, competiive and sustainable energy Production in the Republc of Moldova through a targeted support tothe most viable and ready Avalable local source of renewable energy, namely bomass rom agricultural wastes,“The project purpose isto signicanty increase the use of renewable energy technology through uel smitching ahd energy efficiency, This wil primarly lead to improved heating comfort levels In fural pubis sector buildings Including schools and community centres by using readily avaliable “west stan supplied fom local agricultural enterprises. ‘The second phase of the project has the main purpose of further supporting the development of tha local Bomass market and emerging ndusty and extending activites related to improving heat ‘Somfort in puble buildings, by using local readily available biomass from agricultural wastes, “The project wil lead to the consolidation of the emerging biomass industy and marke, including through creasing supply and ensuring reable qual assurance mechanisms fer biomass ful ‘The second phase wil also increase the uptake of biomass technologies in Transnisre Region, in the Autonomous Terttoral Unt (ATU) Gagauz Yer and in Taracla district, contributing to the Socio-economic development of the regions. as well as cross-ver economic and expertise ‘Sxchanges and thus secloal confidence building and promotion of local entrepreneurship in ‘Transnstia in partnership with Moldovan counterparts. ‘til alse demonstrate the sultabilty of modern biomess-based heating systems for smal towns ‘and the eicieney of integrated renewable energy and energy efficiency soutions, However, the specific emphasis of the project phase Il on supporting market development and ‘Consobdaion is achieved by a comprehensive regulatory 28 well as supply and demand side fpproach which spans overall 4 project components. To ensure the quality of sold biomass fuel, ich i easental for te development ofa sustainable and compete biomass fuel market, 8 ‘Quaity Assurance Center wil be established. The blomass-boler database and the montering System tobe setup wil also contribute to qualy assurance ofthe market. ‘Aiming. at further stimulating local market for biomass boller productonlassembly, thethe Revolving Funds established during the frst phase of the project wil remain under operation Tmonaged by the local parners, the project having @ monitoring and oversight function and prowling assistance in targeting the leasing scheme, contibuting to further simulation of focal fmarket fer biomass boler producton/assembly. Other tools, lke performance grants, could be ‘pple, el. for companies performing well under the curentsubsidy programme for household- ‘Sze boilers run by the projet Uwough the EEA. Support io PPPs wil be enhanced to ensure Sustainable biomass-based heating eerviees and efficient operation and maintenance of the systems. 'A strong emphasis wil be put on continuous training of the emerging biomass boilers operators {nd instttonalizaton of euch 9 function which fs susiined beyond the project ife-cycle.Projet component: cuputs and indeatve atvites ‘The Moldova Energy and Biomass Project consist of four intrelted outpus (work packages) as flows: + Output 1: Municipal biomass heating and fuel supply markets established (work package 1) * Output 2: Foundations laid for establishment of efficient household esting, industrial Cogeneration and biomass briqueting markets (work package 2) * Output 3: Capacity for local growth of biomass markets at reglonal and local levels is built (work package 3) ‘+ Output 4: The opportunites and benefis of biomass energy for Moldova are well known locally. and visit of project results promoted. (work package 4), ‘The outputs and indicative scviies are described below. (Cuput Municipal blomass hosting and fuel suppytechnology markets established (work package 1) As part of the EaPIC project top-up this component aims at instaling atleast 80 biomass-based ‘municipal heating systems and establishing related fuel supply markets (together with Component 2), a8 such contributing to sustainable income generation and value-added chains st the local level. Speci emphasis wil be placed on the target regions ATU Gagauzia and Taracia dstict Transnistria region, small towns, 3s well as on puting in place adequate mechanisms and services {o ensure the sustainably of investments. In support of the other actives under this component, in Tronsnistia activity 1.3 wil be focused on low-cost actions on poly, regulation, and contacting to support the market environment in te region, During phase I of the project this component also has an increased focus on the futher evelopment of the domestic biomass fuel market in view of ensurng sustainable. supply, ‘enhanced competiion between producers, application end verfication of quality standards, cerification of products and end-consumer protection. The biomass-boisr database, and ‘monitoring system tobe setup as pat of activi 1.3 wil further contribute to qualty assurance of the market, Besides fuel supply the project wil put specie emphasis on further stimulating the local market for biomass boiler productonlacsembly. A comprehensive market development and consolidation package will be implemented, The wal-ectabished Revolving Funds will coninus their operation under close guidance and monitoring by the MEBP. Indicative Actviti ‘Acti 1.1: 80 heating systems ad 20 sla hot water syst in publ bangs insta ‘As part of up-scaling the inate in the framework of the EaPIC top-up, specific emphasis wil be placed on the target regions ATU Gagauzia and Taracia distil, Transnistia region, small tune, {8 wel as on putting in place adequate mechanisms and senices to ensure the sustamabily of investments, ‘The alm is to install at least 80 new biomass-based municipal heating systems with a specific f@ajonel focus on Transnistria region, ATU Gagausia and Taracia, and emphasis on sal ours ‘The target for Iransnisina region's 16 puble buildings (3 pe cstict on average), Especaly nthe case of school, it is important to mention that both, schools under the Moldovan Educational Authorities and those under the de-faco Tiaspol administration wil be equally ented to recaive biomass boiler. In a least 20 selected sites the biomass heating systems wil be complement with solar systoms for hot water provision, raising signficant synergies and demonstrating complete renewable-eneray besed solutions. Kindergartens and medica facies are proposed ae target sites for solar systems due to the Immediate impact of the proposed instalation on the health and wel-being ofthe final beneficiaries. In adion, kindergarten (as compared lo schools)and medial facies are operating twroughout the year, as such providing the ides! demand profile ‘Ghd prerequisites forthe proposed technical solutions. ‘The acy will be implemented through the well-tested participatory community mebilzaton Approach with involvement of dlrect Beneficiaries, representatives of local administrations, ‘ecpientinstttions and other relevant stakeholders. Information end awareness raising actives ‘il be cated ou both a cstict level and at municipal lavel. As Inthe curent MEBP phase, equal patipaion ef ren and. women in all decision making processes in communitestowns. Sssocated wit te implementation of biomass projects wil be sought Expressions of interest received from intersted small towns and communities from focus regions wil undergo a comprehensive and parblpatory appraisal procedure, including: technical Teasibiy, energy performance assessment, community capacity assessment in view of system maintenance and ensuring sustainable Tel supply, environmental impacts, fe protection, cost ‘and ecenomic evaliston, Following the esiablshed practice, the rural communttes wil be requitod to contrbute with 15% and toame with 20% tothe overall cost ofthe community project |The conrbuston wil bein cash and in-kind, and wil be assessed and agreed during the appraisal stage. During the inception phase of phase II and prior to starting the activites atthe district lel, a partnership mechanism with the Energy Efficiency Fund wil be designed and establshed that ‘fould alow Tor @ coordinated spproach in investing jointly atthe same sites for demonstration purposes tobe further scaled-up and replicated. ‘The Energy Efficiency Fund (EE Fund) supports projects in the Republic of Moldova aimirg at promoting eneray efcency (EE) and vtlzation of renewable energy sources (RES) that reduce Chergy consumpln from conventional imported energy sources and greenhouse ges emis ons ‘The fnencal support from the EE Fund is provided mainly for measures that result in direct and ‘Bgnificant energy savings Ineuding: improvements in the bulking envelope: EE improverrents ‘Sd use of RES (including use of biomass) fn public hoating and hot water systems and ether fmeasures, Measures fo disconnect rom the Disct Heating system are not eligible fr suppor. For private sector projects, the EE Fund developed a Join Financing Scheme (in form of MOUs) wth oer local financial nsttuions, The same approach might be adopted for a Partnership \Rgreoment between UNDP and EE Fund, Such a partnership between UNDP and EE Fune can be mace operational in a ined timeframe (2-3 months, during the inception phase) through Joctions ofthe EE Fund Administrative Board and the MEBP Project Board and does not rue ‘ny amendment othe enating regulations of both pares. For the establishment and formalization of the parnership, the following indicative stops and procedural aspect wl be flowed and futher developed during the Inception phase: 1) Formal commitment of UNDP and EE Fund management on establishing © co- financing partnership 2) Development ofa Joint Financing Partnership Agreement (PA) between MEBP project ‘ond E& Fund by adjusting existing templates tothe needs of MEBP end Public Sector Projects '3) Approval ofthe JFPA by the Administrative Board of the EE Fund and by the NEBP Project Board 4) The EE Fund already launched a Call for Proposals for the Pubic Sector for 2014 which willbe operational on an on-going basis, based on a“Frst Come ~ First Saved" ‘modality. 5) The EE Fund wil share with MEBP the st of potent projects to be approved ky the EE Fund for financing. MEBP wil share with the EE Fund the Ist of projects that are ‘consilered for mplementatior/approval within actly 1.1 18) Upon approval of projects tobe financed by the EE Fund, preference wil be given to tHove wih secured co-fnancing (pata of fl) from MEBP or other sources for the: Implementation of heating ystems based on biomass bolls. However, the community 6‘cofnancing requirements of both EEF and MEBP will be applied. More specficaly, ‘any contibutions coming from EEF cannot be considered aa local controuion/ce financing for the MEBP and vice-versa, 7) Upon approval of projects to be financed by MEP, preference will be given to those. that have secured co-inancing (paral or ful) from EE Fund or ether sources for the Implementation of EE measures in buildings. For euch project proposals EE Fund al aso share with MEBP the developed Energy Audit Reports on the evaluated bung which wil exclude duplication of investments in organization of energy audits which wil lead to more ecient use of project money. '8) The implementation/supervisioninl acceptance processes related to jointly supported Projects willbe accomplished based on internal procedures ofboth financing partners ‘with exchanges of relevant documentation as per the PA provisions During the phase Il inception phase MEBP project wil also continue collaboration with Regional Development Agencies (RDA) inorder to ensure coordination of actives and avold dupiction of similar work in the regions. Since the beginning of the project @ demand driven collaboration Strategy is applied between MEBP and RDAs, in particular organization of meetings during Promotional and awareness raising actives, exchange of evidence and information on the Projects implemented in the different regions By both pare, common presentation to, potential beneficiaries atthe regional workshops, technical meetings, et For the design end instalation ofthe additonal 80 biomass heating systems, including about 15 systems in Transnistia region, the Design-Bid-Bulld procurement approach is proposed to be ‘applied. This wl nvalve the following stops ‘8. During the project phase Il inception phase one or more exnerienced design companyies) will be contracted based on a Long Term Agreement (LTA), The companytes) wil develop the technical designs (drawings and technical specicatons for constlucion/insialaton {and puting the heating systems into operation). eatimation of costs and bill of quantves, forming the basis for subsequently tendering the implementation and construction works. . In parallel to the selection of the design company(es). the PMT with support of International expertise wil develop the tender documentation and ceria for selecting the companies for the construcion of the heating systems. In. addon the Intemational consistan(s) wil check the Bill of Quantities (BOs) elaborated by the design company and perform overall quality contol of the winning bids, Note: Different procurement approaches (Design-Buld_ vs. Design-Bid-Buld) have ciferent ‘vantages and disadvantages, The Design-Bull procurement approach was applied inthe ft ‘hase ofthe project because ofthe ight schedule of activities, ary defined costs, and having & Single Point of Responsibly. For the new phase of the Project, the Design-Bié Build procurement ‘approach is proposed. Although this approach raquires more time for plementation as compared to Design-Build (approximately 12 months vs. 8 months), the costs are generally lower, gies better control over the final cost of works and additonal leverage n controling the Costs already at the design stage. These factors are of significant importance corsidering the reduced budget pet project ste (please soe also Annex 8) For selection of kindergartens where both biomass and solar ho! water systems wil be installed the folowing indicative Selection crtera wil be Used: 1. Local authority and community demonstrate song matvaton and wilingness to implement ‘combined solar and biomass-based technologies for healirg and hol water provision; 2, Community has sufcient institutional capacity to mabiiz Ical human and fneneal ‘resources, to cover 15% ofthe overall eating and solar het water project cost 3. Existence of a suitable facity that meets the technical requirements for switching o both biomass heating and solar hot water eystems: 4. Number of children attending the kindergarten; preference here wil be given to villages and smal towns with kindergartens with a larger number of atoning children, 5. Baistence ofa functional and sullable hot water distrbuton network (or co-financing ‘secured for is istallaton), ”6. Possibility to instal the required equipment (not water dstributon node or nodes) within an ‘optimal radi: 7. Bhistence ofa continuous water supply source (connection of the kindergarten to central water supply networks) For the combined biomass heating and solar hot water systems, the well-tested, community ‘mobilzation approach wil be applied. Information and awareness raising actives wil be caried Sut by Project Management Team (PMT) at both cistict and municipal level. As result of Swarenese raising actives target communities will submit Exoressions of Interest (Eol) to estict futhorty, which subsequently wil be tranefered to MEBP Offce or can be also submitted directly {o MEBP Office, Incase communes would Ike to install in indergarians or healthcare fecities both bromase and solor systems, they wil have to express the inlorest for both and ater the pre- selection procedure submit project proposal for combined systems, biomass on ur hase of Monitoring and post implementation eupenision of 141 biomass heating systems installed in pubic Dulkings wil continue during EaPIC top-up phase, in order to ensure sustainabill of biomass heating projects in rural communities implemented during the frst phase of the project “These activites mainly alm at organization of unannounced visto implemented projects sites in Communities. with the purpose to: (a) supervise how communities full their commitments for ‘Srouring sustainailty of implemented projects and (b) provce necessary technical assistance to beneficries, when seen needed. In particular, during these vis project consultants wil cary out the folowing actives: communicate with project beneficiaries and representatives of local pubic futhorties and get Information on the practical operation end performance of biomass heating Systems during the last heating eeacon: verfy and monitor how biomass heating systems were Served: maintained and prepared forthe new heating seasor, how bolle operators are ready to ‘parato with the systems: how the systems are supplied with biofuel, type, cost and quality of Durchased biofuel and other tssues related to sustainability of stale biomass heating systems. uring monitoring ane supervision vilts administrators of public buildings and biomass boler ‘operators wil also get technical assistance regarding lypieal measures for preparation of heating Systeme fr the new healing season, regular measures for technical maintenance of boiler plants uring the year, options for taining of Boller operators end procurement of quality biofuel, and ther tops. ‘Such visits wil be carried out atthe beginning of new heating season andlor by the end of each heating season fo collect performance indicalors, District loa authori, rayon energy managers ‘and other relevant departments, by case, wil be also insted (0 participate at the meetings ‘rganized ih communities. The findings ofthe visits wl further inform the capacty cevelopment ‘ond awareness raising eclvtes underiken by the project, as such allowing the project to immediately buid in the lessons leemed and disseminating them to the new generation of project Deneficiaies. Each project ete wil be visited at least once pe year of phase I ofthe project ‘Act 12: Funes atts trough singe purctase mechan ool fe spp During Phase | ofthe project, Actvty 1.2 aimed to support the development ofa private sector market for contractors wishing fo act ae fuel suppliers tothe heating plants installed under Activity {its The Revolving Funds putin place for this purpose during the frst phase of the project wil Temain operational during the second phase, mneged by the national partners inline with the Responsible Party Agreement egned between them and the Ministy of Econony. ‘The project will not allocate futher seed copital to the Fund but will remain responsible for ‘mentoring the Revolving Fund operation and in parallel work with all partners on an exit strategy. {o be implemented by the end of the EaPIC second phase. As such the Revolving Fund ‘Suceessfuly eslabished under the ongoing project wil remain and asset futher stimulating the. private sector market for Biofuel production with focus on pllting, ensuring 9 sustainable fuel [Uppy tothe heating plant installed within the project framework and beyond. MEBP wil ensure that ie Revolving Fund instrument wil continue fo respond o emerging needs and technologies ~of the fuel production sector. leasing equipment required forthe production of high quabty soli biomass fuel (including effctency Improvements at all stages of biofuel production” most important drying) and potential for biomass technology provider, inc. boter manufacturers oF Producers of biomass processing equipment. MEGP together with tne Energy Effileney Agency {and relevant authorities wil also explore the possibities for enlrepreneuss fom the Traneseug region to access the leasing instruments under the two Revolving Funds and faciate tie Process. This will involve an assessment of potential legalcustoms Darers, financial risks, Palitcal risks and absorption capacity of the private sactor on the left bank 2 Funds 0 Lexi During the second phase of the project a thorough manitring mechanism of the Revolving Funds willbe set up to oer sufcent evidence that the alocted resources are used according ts nally signed agreements and forthe overall benefit of the local biomass market The toom used to ‘ensure the successful monitoring ofthe Funds used to lease the biomass processing equipment local producers wil include, but wal not be limited to: ‘+ quarery narrative and fnencal reporting, ‘+ regular spot checks undertaken by project staff (at least 12 per responsible party during 36 ‘months, meaning 24 otal, + field vit (at least 2 per year and party, meaning 12 total) + annual tid party aus (3 in total por responsible party, meaning 6 in otal, commissioned by MEBP and conducted by an independent audt compsny)) Based on the experience of the fist phase of MEAP implementation, the EEA end 2KR wil provide {quarter financial nd narrative reports, accompanied by banking documents providing delald financial information on the accounts’ balance and onthe purpose othe fund usage, [MEBP will provide aggregated reports to EUD about the progress ofthe Revoving Funds, results ofthe spot checks, in-the field verifications and aus ae pat of the regular naralve monring to the EUD. n edition f needed, detailed separate reports wil be made avalable at request. In paral, during the second phase the project wll work with all stakeholders, most Importantly Ministry of Economy, Ministry of Agriculture and Food industry and the EUD to Voldova, ona clear 4nd jointy egreed exit strategy, determining the further use af recollected funds andor continuous ‘manegement of the Revolving Fund after the closure of MEBP's second phat elaborate a Government Decision, in combination witha de Rovelving Fund operation is discontinued after project closure, utining al egal, administrative and technical aspects of continued Revolving Fund operation or use of accumulated funds, As {uch assurance is given that the seed capital ial invested In the Revolving Fund during the first phase ofthe project will utimately be invested inthe futher development el the local biomass market. The draft Goverment Decision, and if applicable the spending programme, wil be ‘elaborated ina timely manner and presented for consuitatlon and approval bythe Project Board at least 12 months prior to project closure. Actty 1.3: Mal environment emhnced 10 support quay, ecincy and efecbvneis and futher matt ‘anslitao spate Ongoing engagement by the PMT with national authorities wil be pursued so as to address poly, legislation and bylaw development to facta the local biomass markets. Th engagement vl include regular meetings with relevant government stakeholders to address ke) factors and adopt best EU practee, and small studies 36 required to idently best practice for other factors The studios and recommendations / stakeholder dalogue wil sim to target very spectc issues reload to tis project's success, and wil thus avoid overap withthe significant budge support provided by the EC and other donars inthe Moldovan energy sectr. During project phase il, Actvly 1.3 will follow a comprehensive strategy in support of further biomass market development and consoldation. The project's interventions wil target supply of both biomass uel and technologies, improved quality, improved market transperence and aeuese to information for evidence-based policy and decision making, and continue lo suppor the cation ‘of an enabling market environmentIn summary, the follwing sub-actvies are foreseen: + Establishment of @biomase-boller database and monitoring system + Quality assurance of solid bofues in view of enhancing the market environment + Stimulating biomass market development through access to information + Systematic assessment of biomass potential + Designing a support mechanism for biomass market development + Trade missions and study tours + Demand-riven expert facity ‘Based on the lessons learned from the fist phase, this approach wil alow for @ certain degree of flexibity fo responding fo emerging needs and challenges and as such for the project to remain highly relevant troughout implementation si i omass-bol 'As pat of project phase Ilan addtional sub-activty wil support the Energy Eflency Agency in ‘xercising s mentoring and conto funclon by supporting the setup of a database on installed biomass boilers and palling a comprehensive monvoring system based on Sensors for remote data collection. For testing purposes, 14 sensor systems wore installod with MEBP support on exiting biomass pollere sare ready to provide the require Information. The ful system functionally is however eelenaured by the onetonce of a remote harduare aarver ready to process colected dats ‘dsiionaly a desktop accese polnt may be required to access data by users as well 9s software for data storing and processing, The project wil support requlaloy changes to facta the Inendateey region of al Domass bolers under this system with subsequent installaton of ‘onvor equipment This activity Is planned as plat In establishing @ one-source database for al baler operating in Moldova, “The devebpment of such a systom wil: "Provide systematic and relabe information on heat production and fel consumation: “Thermal comfort in buildings, COs and ather relevant emissions, operation indicators and court parameter. “The evidence and fealtime information collected and integrated in a comprehensive database maintained by the Energy Effcleney Agency wil alow for fast corrective actons, improvement of the overal sector performance and conbute to sustainabiity of investments. Field supervision of completed projec wil be continuously organized by MEBP and EEA apert from bionase-boller database and monitoring system. As oulined under activ 1.1 iis planned that EEA and NESP representatives wil conduct raguarjont (unannounced) visits among all the ‘Completed bomass project sites, exerising supervision and control ofthe quality of functioning of tomas neating systems, as well as, dentfying any emerging issues and providing necessary technical assistance to beneficiaries, ‘Sub-Acti 2 of os envi ‘The issue of assuring the quality of biomass fuel is critcal in the current stage of market ovelopment in Moldove, While afew years ago only several demonstration producion sites were fn place. curently more than 120 companies are operational and produce biomass fuel in Moldova, However the qualty of ther end-products Is nat uniform and in many cases does not meet ful quality standards and expeciations. This situation has serous implications for the ‘onthuiny postive development ofthe market which has been voiced by euthortes,pracitonors land end-sonsumers the tke. ‘Ageinst his background, the Ministry of Economy together with the relevant bodies and MEBP Support has alteady undertaken deesve steps towards puting in place the required regulatory fremowotk, In 2012, 37 fuel qualty slandords were adopted and a technical reguaton was ‘approvec by the Government 2013, The provisions ofthe technical regulation are mandatory for Siiocal preducrs, inc. minimum phyeieal end chemical cherectrstis of the products to be [abolod ee pelts and briquettes The currently missing decisive bulding block in enforcing boththe standands ond te tectncal regulation is a certnes boty equipped with the necessary laboratory equipment to test and erty the products placed on fhe Moldovan market ‘A part ofthe project phase il his activity wil support, eventually co-finance, the establishment for fan authorized laboratory (Quali Assurance Center) for verying and cerfying the quay of sol biomass fue, essential forthe development of high-qualy Biomass fuel market and ensuring fa ‘competion Between producers and protecting the fnal consumer. In close collaboration wit the National instute for Standardization, the Agency for Energy Efficiency end the Misty of Economy, the project wil facta through targeted capacty assessments and a compettive process the identfeaton of the most sultable host or the Quality Assurance Center exercising the functions introduced by national legislation, The laboratory's capacity wil be strengthened with technical trainings and laboratory equipment fr fue qualty testi, In case adaltonal standards wil be required for the eecter, MEB? wil participate together with the relevant authori in the elaboration of these standards, it joe development tough ‘As outined under the Situation Analysis the local biomass fuel narket developed rapidly over the last 4 years. Some positive signals can be easly spotied on the market, incl. the Increasing hhumber of enirepreneurs, the steadly growing number of consumers ready to switch to biomass, {or household heating, the growing numberof institutions ready to adopt other sources of eneray {or heating, etc. Nevertheless, a major botleneck remains the acvese to retable information on both consumer end producer side. If not addressed, the risk of sawing down the postive dynamics of sector development i high, AS part of the EaPIC top-up the project therefore inlends to focus on increasing access to information by developing an integrated (Businesso-Business 828 and Business-fo-Coneumers 20) electronic platform ready to deliver relable, multidimensional information ebout bromase a8 fut, Being the frst dedicated resource of ths type, itis expoced that the platform wil have a Central role in feciltaing sales of biomass fuel, biomass bolers and equipment I wil provide ‘suppor for those undecided in taking the decision of switching from fossi fuels to & valid and locally avalable atemative. The platform wil provide information or 1) Matchmaking between biofuel consumers and producers. This wil include @ producer Fegistraion providing detailed information sbout products an prices to facltate matchmaking between suppliers of biomass fuel and potential buyers, 2) Householdsibusinesses interested in instaling boilers, providing information on avalable technologies, their characteristics and performance, and producers ane retailers available on the market. This is complemented by information on available incentive. schemes. fy. ‘subsidy and grant schemes or preferential loan products from commercial banks, ee) 3) Information for fuel producers, boiler assemblersiproducsrs and equipment. producers, including information on latest technologies and inventions, iterational market development ‘and trends, including through connectons with Intemational and regional knowledge and trading platforms in the sector. 4) Policy and decision makers and market stakeholders in form of market analysis. This wil include data on biofue! prices, quality, and quantity and their development, based on a systematic and regular market monitoring. Markel tends for bollers and fuel production ‘equipment willbe enother Important par. Technically, @ web portal deployed fo respond to the needs cf iferent stakeholders will be ‘created wih the project's technical and financial support. More special. ‘A modular approach will be folowed, ensuring that each ofthe modules described above Fesponds to the needs of the target group and thet postproect ownership. and 4 Tis indues tetng te fue apa ts pyscal (ameter, lang, bk dary, tes, mee crt, a ona ‘na etre vue) and cereal eu, nitope, ceria re, earn, omic, Sopar Mea) ede "eke and adres conn) apostate ete roo, amaintenance is ensured. The platform and ts modules will be developed with project Suppor and wal be gradually traneferrd to a national partner. A number of local institutions having 2 market development mandate have already expressed interest continuing this (fort The selection ofthe partner(e) hosting the Patform or selected modules wil be done in elose consultation with all market stakeholders, Based an a neces and faasblity assessment. interactive to's for producers to ell an for ‘consumers fo buy biomass fuel, bolls, auilary equipment, ete. may be introduced as part ofthe porta syst mn rial “The decision of an entrepreneur whether to become active inthe biofuel or biomass technologies sector crea depends on reliable and readly avalable information on the avaliablity ofthe raw ‘mater, incl. estimations of curent and future biomass potential. The projections have to be broken down by type of raw material and region In the fist phase of the project. a study estimating the potential of biomass for business was Carried out While assessments like this have to be updated periodically, there remain underying bottlenecks wich also have tobe adéressed, namely Currently no national methodology isn place for estimating biomass potential nor official ‘Statistical data This leads to large diecrepancies in the figures being published, uttmately ‘creating unceriaint for entrepreneurs and impacting investment decisions. = Lack of statistical evidence and systematic data collection for agricultural and wooden bomass, not allowing for coherent, regular and sufcienty disaggregated estimations and forecasts of biomass potential, ‘To remove tis critical market development barter he project wil simultaneously provide support ‘on methodology, inieators and data colection and updating biomass potential estimates, More Spectcaly, the following stop are envisaged 4) Undertake a review of studies on biomass potential developed unt now, to aggregate and Valldate prosenied data and ‘dently the biggest discrepancies and inaccuracies. This will provide « clear picture on the weaknesses of data collection per ype of biomass and wil set {he baseline for the work on improving data collection and assessment methodology. 1) Support the elaboration of a methodology for estimating the biomass potential in close ‘olaboraton with the Ministy of Ezanomy. National Bureau of Statistics, Ministry of Agriulture fand Food Indust, and Energy Efficiency Agency. Its expected that the adoption of the ‘methodology wil provide for coherent data as basis for decision and policy making, ©) Support the improvement of primary data collection and creation of offtcial statistical evidence fon agricultural and wooden biomass in ine withthe elaborated methodology. I is expected {hat is wll be based on EU experience in he fel of statistical evidence of biomass resisues ‘and fuels and requie 2 subsequent transposition of nomatve acts (0 the national lensiaton ‘The role of the project wil ba limited to Increasing awareness of the problem 2s well as colaboration, In the mi ofthe project's mandate, with local and intematonal partners working to support National Bureau of Statstis In aligning local statistics to EU practices. Update the study on biomass potential in ine with the new methodology and, as much as possible, improved primary data ¢ ‘Sub jon ms 28 make nent \While the biomass market was developing woll vor the last fw years, there remains a need for Continued support in view of eonsoldaing the market and helping it adapt fo a changing market rvronment incl changing quality requirements. AL the same time the market of biofuels and biomass burning and processing technologies Is of strategie Importance fo the country and pubic sponding programmes, e.g va the Energy Efficiency Fund, are being putin place. Private sector Support mechanisms, be they publey of donor funded, have to be carefuly designed in order to veld any market distortion, comply witn stato aid legislation and principles, while providing the fight incentives to private sector agents. ‘Against this background the project wil undertake @ study siming at identifying all potenti! ‘pranclal scl, conan, legislative intruments for market stimulation and review ther feasbitycond ouitablity, end recommend apis for the most promising package of interventions. The ‘study, undertaken wih suppor of inlemaional expertise, wil ~ Start from a review of assessments undertaken in this domain, 9, @ recent study on ‘bromoting eco technology uptake = Design instruments in close collaboration with the partners foreseen to adopt and Implement them subsequent, most importantly Minsty of Economy, Ministry of Fiance, ‘and Energy Efficiency Fund. Be based on lessons leamed of successfull applied market development models inthe Sector in ther European countries ~ Provide clear and practical guidelines for each of the instruments or set of instruments roposed, describe in deta the level of fort needed and steps in implementation such as, ‘esponsbie institution, expected timetrame, necessary adstonal resources, expected impact, et, Based on the recommendations of the study, the project will provide tinted targeted support to operationalize those instruments selected by national partners for immediate implementation, Ths \echnical assistance can for example involve rafting of legislation or spencing programmes, bio h jon ‘eed to suppor further market consolidation, in parsle tothe market development activites outlines above, during ts second phase the project wil continus to directly work with ‘enirepreneurs inthe secior focusing both on local fuel production and boller producton/assomty, Compered to the biomass fuel market, the biomass boiler producton/ascembly, segment 1 Considerably more underdeveloped nd needs addtional simulation. While the demand side ‘measures in the frst phase of the project have already contrbuted to hick-strting national Production, further suppor is required fo increase domestic supply of bioenergy technologies. The Support can also be extended to domestic production of biomass processing and soll iatuet Production equipment. The private sector development and consolidation approach adopted by the Project ultimately wil support the socior to rapidly adapt and remain compellveInterally’ and cextemally despite changing markst condtions caused by new qualty requirements and creasing trade iberalization specifica with the EU and Turkey. “The speci objectives are to: = Build the capscty of Moldovan companies alang the whole chain of sold biofuel reduction, marketing and trading. This objective is aleo pursued by Activity 3.3. ~ _Feciltate knowledge and information exchange, promating state-of-the-art technologies ‘andthe assimilation of extemal experiance and best n-clas examples, Ths objective is ‘also pursued by the wab-patform descrbed above. = Facitate business relationships with foreign companies, ‘The market development intrventon package wil include the folowing activities: 4) One study tour for entrepreneurs with participation of selocted poley makers wit the purpose of Providing examples of state-of-the-art production technologies, practical solutions te ferent Issues alongside the value chain of biomass fue, logistics, marketing and trading fools — folowing the principe of “learning from the experience of the bestin-case”. The targel counties to be sited wil be selected based on ther silty with local production condone, ) One trade mission for biomass bol assemblers andlor producers and one trade missions for biofuel producers with the objective of establishing businees relationships wih foreign compar In view of local production under foreign licences and procurement of equipment ahd providing ‘:eportuniy to explore new efficient technologies. Pariipants wil be selecied on @ compelive basis emong the most active local bolor producers/assemblers, The missions wil cover selected EU counties and where feasible wil be combined with participation at relevant specialised Intemational exhibtione/trade-fair,FFor all study tours and trade missions, the project wil make an eft to include people and ‘Gntepreneurs from both banks ofthe NSU, a5 a paricular step for bulcing confidence as well as ‘Sharing good experience, The projects aiming at supporting the develoxment of cooperation hat emai afer the end ofthe project ‘Sub.Actviv: Demand-criven expert acl ‘Targeted European expertise in form Individual experts or consulting services wil be made {vallable to actors ofthe local blomass marke, providing access to specialized knowledge in production and consumption of Biomass, latest technologies and invenions, Intemational market Sovelopment and trends, policy and regulatory frameworks, support mechanisms and incentive schemes. ‘Based on the demand identified by the project team or project stakehclders from the publis and pivate sector. interational experts wil be contracted for specialized assignments responding to Cmorging needs and clea Iues and barriers identfed as part of poject implementation, The {echnical assistance ean range from traning provision, workshops fer practitoners, inputs for poly and regulatory framework development, methodological guidance, etc. The experts! work ‘hil alco be used to populate the web-platform wih latest information. Other low-cost activites will address emerging policy, legislation and bylaw development issues {or further enhancement ofthe local biomass markets, This wil intude round-table, workshops land dacussions on topes relevant lo production, qually, trade, marketing, etc, wth patipation (of intemational and national experts as required, In Transnistria region, based on the ongoing engagement ofthe Project Management Team with the defacto regional authors, low-cost activites will be proposed tote implemented to adress poly and regulatory gaps idetied during project implementation on the let bank of Nisin Erder to ensure the applicability of the technologies and the functioning of local biomass markets. ‘This engagement wil incde regular meetings wih relevant local administration stakeholders and onefelares to adress Key factors and adopt best practices, also bulding onthe lessons learned luring the implementation ofthe Moldova Energy and Blomass project onthe right bank. ‘Outpt 2: Foundation lad for establishment of efficient housshold heating and heat supply markets ‘established and private sector demand promoted (work-package 2) ‘As part of the ectivtes under the EaPIC top-up, this component will up-scale Activity 2-1. promoting biomass technologies atthe level of ndvidual households and small businesses. Based fn the resuits and lessons leamt from the previous period, at least 300 households and smal Businesses wil be supported o procure modem and ecient biomass boilers under preferential ‘conditons. For fostering PPPs for establishing sustainable biomassbased heating services and ficient fperaion end maintenance of the systems supporied under Actvly 1.1, the project will provide {Gonnsal and final support to up-seale Activ 2.2 with eatin of 7 new PPPs throughout the County tis expected tht successful PPP models wil be further repicated, biggering private Sector investment in biomass-based technologies, By piloting the use of biomass in ealected economic sectors with high replication potential, Activity sea aa both simulate private sector demand for domestic biofuels and potentially biomass burning technologies as well as demonsiate the efciency and costeffectveness of biomass technologies In production processes. The pilots will be undertaken in coloration wih Agricultural Coleges land Professional Schoos with production process with high replication potential. Further, at the so far untapped potential of housenold wastes and residues a raw material for biofuel production wall be demonstrated in the framework ofan inter-municipal cooperation plot project. Indicative Activities Py‘Achy 2.4: Mate solsion igh etcienyafodale ral Bass household eat iene and ped ‘This project actvty wil aim to stimulate the market for high efficiency biomass-based domestic, heating systems. I follows a classic commercial markel creation / markel baer model consisting of four Key interelated components: a) information, knowedga and outreach, 6) svalegie Partnerships and allances, c) infrastructure support. ) market stimulation ‘As part of the EaPIC top-up, this activity will ge addifonal stimulus to the market for high: efficiency household-size biomass heating systems sultable for rural areas and smal tons Prior to continuing the Incentive scheme during phase I, a study wil be commissioned to analyse the existing subsidy mechanism, aiming ata bettor targeted and differentiated approach, both In the residential sector and for micro-nterpises. It's expected that this wil rut In an adjusted level ofthe subsidy further broken dowm by typeof technology an boil performance, househoid Income, type and sizeof business and fuol used. Adeional selection cera wil be proposed and Introduced after Project Board approval, aiming to improve the effeciveness of the incentve Scheme local households ant husinasees Al least 250 addtional heating systems will be installed in private houses with the financlat incentive provided by the project in partnership wan the Energy efiiercy Agency, inl. Up 12 20 units in Transnistria region. Under this sub-actviy. women -led households and women home ‘owners wil be given preference when applying forthe subsidized howsehold boiler programm, A Selection criterion in this regard wil be developed, discussed with the Project Board. and Introduced inthe regulation. n the second phase, mors emphasis wil be placed on promoting te scheme among mioto-enterrises, spectcaly in rural areas, via a targeted communication and information campaign in close collaboration with relevant pariners Me the Energy Efficiency ‘Agency or Chamber of Commerce, At least 50 busineseas wil have eficient stoves installed by the end ofthe project All boilers eligi for participation inthe programme wil use biomass brquettes andlor pelts os ‘uel end wil be partially or ull assembled / manufactured in Moldova, ‘Activity 22: Market slurs biomass tase eal sup sens np bugs veloped ‘As pat of project phase I. his activity wil upscale the plot activity on eetablshment of PPPs for rowsion of sustainable heating services based on sokd biomase ful to all regions of Moldova, {contrbuting to the everal biomass markel development. Partnering of public and private sectors {or providing heating service to public bulings wi = tPorease the heat comfort by providing professional contracted vesting service to target buldings ~ _Tranafer the responsibitty for boiler operation to the private partner (uel type, quantity and ual, hiring and raining operators, maintonance of bole room, dally operation, tc) ~ Add value tothe overall service quality by involving professionals inthe process ~ IPorease the sustainailty of the overall existing investment though use of high quality ‘uel, provision of professional operational and maintenance serie, a8 well as expansion Of the network of biomass boilers through commercialy viable Investment projects; Up to7 PRPs willbe established in all Rgions of Moldova, wth atleast i PPP in ATU Gagauzia, ‘Taracia andlor Bassrabeasca districts respectively. The selection of PPS wil be based on & Competiive process, collecting Expressions of Interest from DistidiLocal Authorities “and subsequent competitive tendering by the Local/Regional Pubke Authortes for the identiication of the prvata sector partners, ‘Tho establishment of the PPPs wil be coordinated with and guided by the Agency for Public Property, whichis the relevant state athorty inthe field. The project wil make sure that synergies ‘are created with the current Twinning Project targeting the Agency for Publc Property and that any potential overaps are excluded, ‘Tho MEBP support wil cover the cost of the PPP feasibly studies es well az provide a grant incentive forthe investments envisaged under the PPP,_Acvity 23 fice! and sustainable amas uring technologies fr pradutnpoceses ped andthe potent of hovsohod ive asides explored During ts fist phase, the project successfully stimulated demand for sold biofuels from the public land prvate residential sector. In support of @ sustainable solid biofuel market and technology providers market itis however also necessary to create demand from the commercial sector and Stele with s0 far unrealized potential, as municipal services. The project wal herefore as part of the sezond phase support plotng the uso of biomass for selected sectors and production processes with high replication potential and dect avalabilty of relevant residues, The project wil Rave a1 htegfated epproach towards contrbutig fo achieving the overall goal of demonstrating the suainebity of using biomass in economic sectors and generating private sector demans. ‘Switching to biomass fuel 's advantageous due to cost and price considerations. Energy as an Important element of producton cost influences the price of end-products and as such the ompelveness of the private sector. Therefore the incentives ars high to invest In changing producion technologies, energy ficiency and alternative energy resources in_producton Prooesses. Further pres predictably fs higher compare to fssi fuels where price formation is Pot transparent and dependent, inl on extemel goo-poliical factors. And closed eyce systems, 2g where an enterprises uses ts own residues for energy generation, bring afficiency gains. AL the regional level, Interemunicipal cooperation (IMC) is being piloted In Moléava as a promising tmedel of effeent and sustainable service delvery at the local level. At the same time the {atimaied potential of household residues 9s raw material for biomass fuel producton Is high, Specialy in rural areas and smaller towns. Indicatve sub-acivtes include: = Identficaion of economic sectore with high replication potential of using biomass in production processes: This assessment is potenaly undertaken as par of the analysis on Support mechanism and biomass potential cartied out as part of actly 1.3. A prospective prorty sector is agreuture and agro-processing as one of the major sectors of Moldovan conomy, with for example the frutlgrain crying having a high estimated potential of sing Bomase for energy. Inrocuction of state-of-the-art technologies inthe field of biomass buming has the potential to decrease energy costs ofthe sub-sectors. Such models, when ‘ented, ploted and tested, have a significant replication potential. «Piloting the use of biomass for heat generation for production processes in the framework Of Agicutural Colleagues and Professional Schools: As a starting poirt, an analysis of af Soleges and schools wil be undertaken, Wentiying avaliable raw merials, production processes, heat energy demand and heat lead, and potentials for tegrating biomass fechnologies. Based on the recut, two Insttutions wil be selected fer the realisation of pilot projects with the sim of demonstrating the application of biomass technologies in Production processes, Preference wil be given to insitutons with own avaiable raw Fterais (to demonstrate a closed cycle system) and producton processes which have Fgh repicaton potential inthe private sector. The scope of the pilots encompasses both the production of biomass fuel, Le, for example estabishment of a briqueting ne, and instalation of biomase bor for heat provision. Based onthe pilots, replication gudstines willbe produce and further repicaton promoted, incl. in partnership wih MeSEFF or other parners offeing financing and aselstanco for tho realisation of such projects, Close Synergies wil be established with tho VET activties under component 3 (Actviy 3.5), tlher having the VET partner insttuton selected as pot sie andlor by linking the VET {clivtes wth the pilot sehools and colleges for hands-on exposure for raring purposes. «Piloting IMC for biofuel production and supply: Currently INC madels n form of municipal or prvate enterprises providing services to @ group of municipalies are being piloted throughout the ‘county. The services cover for examples water supply, sold waste management street igntening and others. Among the 10 plot IMCs curently working, 5 focus among othr things on waste collection. A considerable share of household wastes, if Colecied separately, can be further used as raw material for sol bie! production. The project wil conduct a feasiblity study and an analysis emong all relevant IMCs and [ecaltis with te alm of kentfying one piot ste. The plot project wil focus on establishing ‘Seystom of separate collection of household wastes of organic origin, which wil ‘subsequently be processed and briqueted by the enterprise. The produced briquettes wil be delvored back to the households based on a welkdefined supply scheme. The pilot Eyproject wil cofnance the investment cost related to instaling a briquette production line ‘nd a biomass bor forthe premises ofthe enterprise, and wil cover the costs related to {an awareness raising and education campaign among the households benefiting fram the Services. In addon, small scale equipment or low cost colection bins, intel incentive ‘or households, will be provided on cost sharing boss ~ _Promation and replication: in order to stimulate ital replication, the successful pots wil bbe widely promoted and lessons leamed wil be codified in brief case studios and replication guides. The project wil osely collaborate with intitaons and programmes providing tiancing or support for repicaton, mluding MOSEFF and Energy Efiloncy Fund. Based on the study on appropriate market support mechanisms and msiruments Undertaken as part of Actvly 1.3, the project will promote the adoption of relavant instruments for furtnerrepicaton. AS 9 result of project Implementation tis expected that ‘he private sector wil increasingly uptake biomass technologes, creating intemal demand hile ultimately reducing production cost and proes fr end-products. ‘Output: Capecty bul fo growth of biomass mart at regional and local levels (work package 3) Ouiput 3 alms to ensure thatthe benefis of biomass energy demonstrated and deployed under ‘outputs 1 and 2 are delivered in lasting and long-term way and that local capacty for further replication is ensured, For each slakeholder type to be reached under outpat 3 the ft sop wil be the development of taining materials, o be placed inthe public domain, These materials, o be updated and improved each year, wil provide an accessible repostoy of Key information, an wi be used ether in the training to be delvered under outputs 1 & 2 or in sub-actvites under ouput 3. The stakeholders 10 be targeted include: municipal management incising mayors, ch Servants, and teachers; strawsfred boiler operators: fuel supplier: and school children a detaled below. Given the significant budget support and cooperation between the EC (and other donors), {and the national authortes in the energy sector, Incuding in policy and legislation for renewable energy, this project wil not seek fo address renewable energy policy and related apacties iocty, apart from the very specific and targeted actviles that have been described under Actisly 13 above. ‘As pat of the EaPIC project phase Il, this component aims at adapting andior updating of training materats, as required, and tallor-made trainings for each stakeholder type to be reached by the project. The main target groups include: representatives of local puotc administrations, chil ‘servants, managers of puble institutions, teachers, biomass-red boler operators, agr-businesses {and eniepreneurs intending to produce biomass fel, curent biomass fuel suppliers, school children and women enieprenours from ATU Gagauzia region as delaied below. Local Public euthortes and bulging managers from the target regions will receive technical lining regarding the effective management of combined solar and biomass-based Insalafone Drovided with MEBP support (Activity 3.1.). The operators ensuring tho functionally and ‘maintenance of biomass-based and combined biomass and solar isiallaione. wil reosve technical hands-on training from the installesfproviders. of respective egupment. and. wil Participate in national study visits to successfull operated sites. In paral, in ordr to eneure the Continuity of biomass boller operators (existing and newly hired) training beyond the ifecycle of MEBP. the insttutonalisation of the training funstion for biomass bole operators willbe pareved ‘uring the second phase of MEBP (Actvly 32). Private entrepreneurs wil be trained to produce, slore and supply sod biofuels in ful compiance with the newly inroduced standards. and {echnical reguations. A comprehensive taining module on improving their managerial skils and knowiedge regarding production of high qually sold biofuels using modem technologies wil be Provided. Folowing the establishment of th biomass fuel-testing laboratory, a handbook on “Sol Bouts Quality Assurance" wil bo developed and provided to biomass fel supplors on a eel. ‘studyleference basis (Actvly 3.3). The School education activites on renewsbl energy and energy efficiency, especially the Bioenergy Summer Camps, wil be extended to smal own from Moldova, Taraca dsiret, Gagauzia and wherever feasibio in Tranenistia. Educational malate il be updated, transiated into Russian and provided to all schools from sites selected during MEBP phase il. Teachers will receive taining and on-going mentaring far tha organisation of ‘edveation and awareness ectiviies In schools (Acti 3:4) As part of MEBP topsup. the joint‘efforts to equip the Moldovan labour force with skils that best address the needs ofthe emeraing markets and technologies, will be addressed through the vocational education and taining (VET) Sector (Acy 3.5). Indicative Activities ‘Activity 31 Capac of munca eadrs fo marap biomass syste enhanced Municipal leaders including mayors, local councilors, and chil servants such as teachers need Informaion in how to manage the operation of biomass-burning bolers in ther local autores, ‘Topics 1o be nckuded in the training wil eluding general principles of operation, necessary ‘manterance routines, optimum bulging heating system operation (Induding such issues a6 ‘verheating and underheating of various fleas ofthe buldng), regular and sustained performance monitorng (eluding standard forms and reports), and sound management of fue suppliers (including competitve tendering (standard tender formats), contracting (standard contacts), ‘aly central (ehecking quality and condition of supplied ful), end storage). During project phase I the aches on capacity development for Local Public Autores and Social balty managers wil be contnued. Traning materials wil be adapted to address the Speatics of small towne and Transnisira region, and translated into Russian for audiences in Franenetia, ATU Gagawza and Taracla distict Additonal training materials relied to the Speration and maintenance of combined blomass end solar systems wil be developed and IMeorporated as pat of the taining package provided forthe respective target group. Training ‘workshops wil dress both theoretical and practeal aspects related to diversification of energy Source and production of energy rom local renewable energy sources, specifically biomass, In adetion to the technical training provided, the LPAS at community and town level where blomase-buring Boils wil be Installed, wil be provided with the @-Steps Roadmap fr Effective Biomass Heating’ (avaiable in Ro, Ru) developed under the current MEBP phase that outines ‘raphicaly the erileal steps (purchase of quaitatve fuel, preparstory works in the bor plant puting It into operation, ensuring proper functoning of the heating system, boller plant Eonseration, boter plant servicing, curentrepai works and training of operators) © be taken by focal outhoriies throughout the calendar year in order to ensure a smooth operation and fonctonlty of the biomass heating systems Installed with MEBP support. A similar roadmap fasting the key steps in the operation of solar colleciors wil be developed for display at project locations ‘Specie activi fortis target group wil include “Regional Technical Tralring Workshops on Effecive Management of Biomass Heating Systems in Puble Buildings and Eneray Effcieney Measures (at least one each in ‘Gagauza, “Tranenistia region, Taracia, and ‘wo for target sites from small towns in Mokiova) For local leaders and facity managers receiving Integrated biomass and solar ystems as part of MEBP top-up, the taining wil addrass the operation and maintenance Of such instalatons, As far ae the Transnictia region is concerned, depending on the ature ofthe project sies supported duing MEBP phase Il, the trainings wil be focused on Improving the energy ficiency and energy performance of existing pubic buildings (possibly supported witin other projects, incusing EU-funded ones). “+ Study Visits for municipal and central authortes from ATU Gagauzia, Tansnistia region, {Taratia and selcted small owns from MoKdova fo already funcional biomass heating Zyetome and fuel producton sites estabished with MEBP suppor, to raise awareness, Showcase best practices and deliver hands-on experience on operation and mintenance: of biomass heating systems, «+ Following the successful practice from the frst MEBP phase, a group of LPAS from the: Fegions targeted dung MEBP phase I, wil be selected to participate in an lemational ‘Study vst fo an European county where the use of RES-derived energy, esgecally from ‘lomass anu implementation of Inegruied solutions for clean energy production hove,