ALFA WATER INVESTMENTS

Investments in water and wastewater infrastructure in the Province of Varese (Lombardy Region).

The project aims at supporting investments in water and wastewater infrastructure in order to improve the coverage, quality and resilience of integrated water services in the Lombardy Region. The underlying investments will bring operational efficiency improvements (e.g. reduction of water losses, increased energy efficiency, better resilience to extreme weather events) and generate substantial social benefits by improving the environment and public health in the Province as well as increasing employment opportunities.

The project will support investments in water and wastewater infrastructure in the Lombardy Region in Italy. In doing so, it will ensure compliance with key European regulations in the water sector, and improve the quality and resilience of water and wastewater water services. The project will contribute to the Bank's policy objectives of Sustainable Energy and Natural Resources as well as Climate Action and Environmental Sustainability. It will also address a number of market failures through positive externalities in the form of environmental and public health benefits, notably improved quality of recipient waters, reduced emissions of greenhouse gas of wastewater infrastructure and stronger resilience towards extreme weather events. These benefits are not reflected in market prices and would not be realised to the same extent without public intervention. In addition, the project will address a chronic investment gap in water services in Italy. The EIB financing will allow the Borrower to lengthen the tenor of its debt, benefit from financial flexibility in the disbursement, and to contain its cost of funding at the same time. In addition, the EIB presence is expected to attract other potential lenders willing to support the Borrower's investment plan, being the Bank's loan unsecured.

The investments are expected to have positive net environmental and social impacts, considering their focus on compliance with, amongst others, the Urban Waste Water Treatment Directive 91/271/EC, the Water Framework Directive 2000/60/EC, and their contributions to resource efficiency from efficiency improvements. Where and if applicable, the requirements of the Environmental Impact Assessment Directive 2014/52/EU amending the Directive 2011/92/EU, Birds Directive 2009/147/EC and Habitats Directive 92/43/EEC will be verified during appraisal.

The Bank will require the Promoter to ensure that contracts for implementation of the project have been or will be tendered in accordance with the applicable EU procurement legislation, Directive 2014/23/EU where applicable and/or 2014/24/EU where applicable and/or 2014/25/EU where applicable, as well as Directive 92/13/EEC and Directive 89/665/EEC, as interpreted by the Court of Justice of the EU, with publication of tender notices in the Official Journal of the EU, as and where required.