SUSTAINABLE WATER SUPPLY BRABANT WATER

This is part of the 2022-2026 investment programme into the production and distribution facilities of Brabant Water NV, the Netherlands' second-largest water supply company, operating in the province of North Brabant. The programme consists mainly of upgrading groundwater treatment facilities and the rehabilitation and extension of distribution pipes.

The project consists of a 4-year (2022-2026) investment programme that aims at upgrading drinking water supply and distribution networks in the service area of the Promoter. The project consists mainly of the replacement and upgrading of water production infrastructure, transmission mains and distribution network.

The project concerns the 2022-2026 investment programme in the production and distribution facilities of Brabant Water, the second largest drinking water company in the Netherlands. The programme consists mainly of renewal and extension of water treatment plants and distribution networks and it will be to the benefit of over 2.5m inhabitants in the service area of the company. The project aims to maintain supply security in the context of climate change and maintain service quality at current high standards, and be implemented by a promoter who has very good capacity. In particular, the investments will enable the promoter to reduce energy consumption and increase water efficiency over the overall supply system and to better cope with more frequent and prolonged drought periods, a foreseen climate change impact within the service area.The project will contribute to mitigating market failures in the water supply sector by financing infrastructure, which generates positive environmental, public health and climate externalities that are not fully reflected in the applicable water tariffs in the Netherlands.

EIB is a cornerstone lender to Brabant Water NV. The new EIB financing will fund a project that is part of this substantial capital expenditure program. The Bank's lending offers a longer tenor and a longer grace period than commercial banks, which accommodate the long implementation horizon and align with the economic life of the asset financed. In addition to a modest financial advantage, the Bank's lending also offers flexibility in disbursement (dates and fixed or floating interest rates). With a financing of not more than 50% of the projects costs, the EIB loan is expected to crowd-in other lenders.  

The investment is geared toward securing a sustainable management of water supply and distribution, bringing about positive environmental impacts. The upgrading of the water distribution pipelines, pumping stations, production infrastructure and other network and process optimisation measures are examples of components with environmental/resource efficiency impacts. The Promoter also has the intention to enhance water supply infrastructure resilience and address adaptation to climate change through this project. Compliance with the EU Water Framework Directive (2000/60/EC), Drinking Water Directive (98/83/EC), and EU and national environmental legislation will be verified during appraisal.

The Bank will require the Promoter to ensure that contracts for the implementation of the project will be tendered in accordance with the relevant applicable EU procurement legislation (Directive 2014/25/EU or 2004/17/EC, where applicable, as well as Directive 92/13/EEC) as interpreted by the Court of Justice of the EU, with publication of tender notices in the Official Journal of the EU (OJEU), as and where required.