CENN Daily Digest – 04/30/2004

Table of Contents:
1. NGOs Remains Final Opposition to Water Take-over
2. First case of human anthrax reported in Armenia
3. Design and Installation of Solar Photovoltaic Power Station
4. World Bank to Decide on Oil Investing by July


Source: The Messenger, April 29, 2004

After reassuring detractors by inviting a delegation from Tbilisi to its
headquarters in France, the French Compagnie Generale des Eaux (CGE) is
all but finally at the helm of the Tbilisi Water Supply Company
(Tbiltskal- kanali). Only a few non-governmental organizations and
analysts are fighting the company’s takeover of Tbilisi water’s
management. As they maintain, Tbiltskalkanali’s problems will remain
unsolved and the people of Tbilisi will be deceived.

The Tbilisi water supply system has long been in need of extensive
repairs. For this purpose, the World Bank allotted a EURO 25 million
credit, though it stipulated that the right to manage this sum be
granted to a company with experience in serving a city with over one
million residents and with assets worth over USD 50 million. The
tender’s results became known shortly after the Fall 2002 tender- the
French CGE prevailed.

The events that developed in Georgia at the end of last year stalled the
French company’s entrance into Tbiltskalkanali as did objections
launched by the Labor Party who claimed the company would jack up water
prices. But a recent visit of Tbilisi Sakrebulo (City Hall)
representatives to the company’s head office in Paris in April put an
end to the reservations of the city’s government.

According to Sakrebulo Head Zaza Begashvili, who was a member of the
delegation, the “French company does not plan to raise the tariff on
water consumption.” He also claims that if the French company receives
the management rights, the Tbilisi budget has the potential to save the
GEL 15 million annually that it spends on Tbiltskalkanali.

Begashvili said the government demands that the French company meet a
number of conditions after assuming management. Specifically it should
supply the capital’s population with 24-hour water and maintain the
minimal tariff on water consumption. If the Sakrebulo approves the
tender awarded to CGE in Georgia, the company will be obligated to
repair the capital’s water infrastructure, including, first of all,
changing the water pipes.

Now, the only voice protesting CGE’s takeover of Tbilisi water is the
NGO “Mental Development of Vake District” which claims that the
conditions of the tender will prove damaging to the Tbilisi population.
They recall when the American company AES came to town and managed the
local electricity distribution company Telasi. Such a comparison causes
concern among the population, as under AES electricity rates increased
quickly and electricity supply problems remained unresolved.

Opponents of CGE claim that the company’s plan will not improve the
quality of water, will not ensure 24-hour water supply and will not
repair the city’s water pipe network. Supporters of the French company,
however, disagree and point out that the total rehabilitation of the
Tbilisi water supply system will require a total of USD 300 million. The
company, meanwhile, will do the best it can with the funds allotted to
it by the World Bank.

In accordance with the terms of the tender, CGE will manage
Tbiltskalkanali for ten years. Of the WB’s EURO 25 million, 22 million
is foreseen for the rehabilitation of, the city’s water system. CGE
itself has said it will invest another USD 8 million of its own money in
the system. During the fIrst three years, the water rate will not change
and water consumption meters will be installed throughout the city,
though in apartment buildings a single common consumption meter will be
installed. Later on the rate will be gradually increased and reach GEL 2
per person per month (approximately 20 tetri per cubic meter of water
consumed) by the tenth year of CGE’s contract.

CGE management explains that they have proposed an operator tariff to
the Tbilisi government to compensate the water company for the new
operation, the investments, and improvements forecasted The Tbilisi
government should decide on the consumer’s tariff and then pay m receive
the difference As of now, the rate on water consumption is 90 tetri and
12 lari per person per month Furthermore, collection is less than 40
percent Not only individuals, but also businesses and organizations fail
to pay for their water. Total debts to the Tbilisi Water Supply Company
exceed GEL 40 million When the French company Generale des Eaux assumes
the management contract for the company, it will be responsible for
registration and fee collection This no easy task.

The issue of signing a contract with CGE is practically settled A draft
of the contract has been prepared and will be discussed by the NGO
sector, society at large and Sakrebulo commissions If their verdict is
positive, the contract will be signed by the city government,
Tbiltskalkanali and Generale des Eaux representatives.


The American University of Armenia commenced implementation of the
project entitled Design and Installation of the Solar Photovoltaic Power
Station in Spring 2003. This project was brought into being due to close
cooperation of two leading entities in this field, namely the
Heliotechnics Laboratory of the State Engineering University of Armenia
(SEUA) and Viasphere Technopark -Transistor Plus.

The project was realized through generous funding by Mr. James
Turpanjian, Armenian benefactor living in USA. He is known in Armenia
for a number of financed projects.

This station has the highest capacity among similar systems functioning
in Armenia and the only one that is integrated into a solar driven
heating and cooling system. Since Spring 2002 the American University of
Armenia has been using solar water-heating panels for heating,
ventilation and cooling purposes of one of its large auditoriums through
the operation of special equipment. However, the electric portion of the
power supply of this equipment was taken from the electric grid. The new
solar electric power station will allow extracting the necessary power
for the above mentioned equipment also from solar radiation, thus making
the whole system independent of the external power supply.

The system is comprised of solar photovoltaic panels field, a solar
battery bank, and a three-phase DC/AC inverter.

The 72 solar photovoltaic panels are installed on a special seismic
isolated structure on the roof of the University. Each panel has
approximately 0.7 square meters of surface and has been produced at
Heliotechnics Laboratory of SEUA. Total surface of the panels is around
50 square meters with total peak power of 5 kilowatt. The photovoltaic
converter cells used in the solar panels were made by Krasnoye Znamye,

The three phases DC/AC inverter has been designed and manufactured
specifically for this project by Transistor Plus thata is a part of
ViaSphere Technopark.

This project aims at demonstrating the feasibility of using the solar
energy as an alternative power source in Armenia.

Dr. Artak Hambarian,
Associate Director
Engineering Research Center
College of Engineering
American University of Armenia (AUA)
40 Marshall Bagramian Av., Yerevan, 375019, Armenia
fax: +(3741) 512 512
phone: +(3741) 512 631, 512 638 (AUA), 395 477 (home)


Source: Moscow Time, Apr 29, 2004

The first case of human anthrax has been registered in a village in the
Shirakskaya region of Armenia. As reported to a Rosbalt correspondent by
the Armenian Health Ministry, the infection originated in cattle, and
health workers do not exclude the possibility that the case will not be
the only one.

As of April 17, tens of cases of anthrax in cattle have been reported in
the region. The cause of the epidemic has been attributed to substandard
vaccine. The area has been quarantined, and health workers have reported
that the epicenter of the contamination has been localized.


Source: planetar, April 29, 2004

The World Bank will decide by July whether to keep investing in oil, gas
and mining projects, World Bank President James Wolfensohn said this
week, a subject of concern to environmental groups.

Wolfensohn commissioned an independent report in July 2001 to review the
bank’s role in so-called extractive industries.

Questions have been raised by environmental and global nongovernmental
groups whether the bank’s backing of such projects contributes to
development and lowering poverty in poor countries.

The Extractive Industries Review, led by former Indonesian environment
minister Emil Salim, recommended the bank cease funding oil and coal
projects because of environmental concerns.

In a draft response to the report in February, the bank said its absence
from these projects could result in lower quality projects and weaker

The bank’s most controversial oil projects, the Chad-Cameroon and
Caspian oil pipelines, were approved by the lender’s shareholders amid
fierce opposition by development groups, which said the projects would
do more harm than good.

But Wolfensohn said this week the bank first wanted to complete
consultations with industry and governments on the matter before it made
a final decision.

“I would guess you’re looking at a June or July date for something
definitive,” Wolfensohn told a Washington conference on energy sponsored
by the Center for Strategic and International Studies.

“In the meantime, dialogue is going along constructively,” he added.

Wolfensohn also said the oil and gas industry should pay attention to
the needs of the developing world, where demand for energy is set to
increase as populations grow.

In China energy demand is expected to triple in the next 20 years,
Wolfensohn said, adding: “And my guess is that’s a conservative

Magda Stoczkiewicz
Policy coordinator
CEE Bankwatch Network
c/o Friends of the Earth International
PO Box 19199
1000 GD Amsterdam, Netherlands
phone: +31 20 622 13 69, fax: +31 20 639 21 81
email: [email protected]

Caucasus Environmental NGO Network (CENN)

Tel: ++995 32 92 39 46
Fax: ++995 32 92 39 47
E-mail: [email protected]