All agreed loans

Russia. Petrozavodsk Communal Utilities Systems

Date of agreement: 9 Jul 2012
Country: Russia
Customer: Petrozavodsk Communal Utilities Systems
Amount in RUB: RUB 280 million
Amount in EUR: EUR 6.9 million
Maturity: 10 years
NACE sector / loan type: Collection, purification and distribution of water

This loan contributes to climate change mitigation: 50%
This loan has a positive effect on maritime environments: 50%


The EUR 7 million loan totalling has been provided for the rehabilitation and improvements of facilities for water supply and wastewater treatment in the city of Petrozavodsk, northwest Russia. The existing wastewater treatment facility will be expanded by a sludge recycling/dewatering plant and a chemical precipitation unit to remove phosphorus from the city’s wastewater.

The investment programme is being carried out by Petrozavodsk Communal Utilities Systems (PKS). In financing the programme, NIB joins a group of international financial institutions led by the Nordic Environmental Finance Corporation NEFCO.

PKS is a full subsidiary of the privately owned Russian Communal Utilities Systems. The company has operated the water and wastewater systems of Petrozavodsk since 2006, when the municipality decided to outsource its water utility services.

Fulfilment of NIB's mandate

The city of Petrozavodsk has long suffered from a deficient treatment of its sewage, and several attempts have been made in the past to implement investments in this sector in Petrozavodsk. The proposed investments will facilitate the reduction of the emissions phosphorus and nitrogen, which would enable the plant to meet the requirements, set by the Baltic Marine Environmental Protection Commission HELCOM.

Sustainability summary

Due to the insufficient treatment of its wastewater into Lake Onega, the city of Petrozavodsk has been identified by the Barents Euro-Arctic Council (BEAC) as one of the environmental hot spots in the region. Lake Onega belongs to the Baltic Sea catchment area.

The launch of a chemical precipitation unit for the removal of phosphorus from wastewater is a significant improvement from the recipient point of view. Phosphorus is the nutrient in the Petrozavodsk Bay controlling algal growth and eutrophication. Currently, the overall anthropogenic load of phosphorus is approximately 224 tonnes a year, of which 60% comes from the wastewater treatment plant. The estimated phosphorus load reduction is approximately 115 tonnes a year.

The other macronutrient which controls eutrophication in the lake is nitrogen. The implementation of a denitrification phase in the wastewater treatment process is estimated to reduce nitrogen load by approximately 222 tonnes a year, around 13% of the total nitrogen load.

The improvement of the secondary sedimentation phase will decrease the amount of suspended solids by 345 tonnes a year, which will improve the recipient conditions by reducing the oxygen consumption and the fouling of waterfronts and fishnets.

The main environmental risk is the sludge disposal from the wastewater treatment plant. The sludge is contaminated with heavy metals and is not being stabilised. Currently, the sludge is being disposed of in the municipal land fill, which is an unsatisfactory solution but in line with the local requirements.

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