ASA LIVORNO WATER INVESTMENTS GREEN LOAN

The project will finance the 2025-2030 water investment programme of ASA Livorno. It will encompass a range of investments in water and wastewater infrastructure across the promoter's service area, primarily within the province of Livorno and parts of the provinces of Pisa and Siena, in the region of Tuscany.

The project objectives are to strengthen the promoter's capacity to deliver resilient, efficient and environmentally sustainable water services across the 32 municipalities of ATO 5 in the Toscana Costa area. The project will support targeted investments that contribute to reducing water losses, enhancing water security, improving resilience to flooding and safeguarding environmental quality.

The Project is in line with the InvestEU objective of Environment. It supports investments in water and wastewater infrastructure by a local utility providing Integrated Water Services in the Tuscany Region, Italy. It ensures compliance with key European regulations in the water sector and improves the reliability and quality of water and wastewater services, by improving local water sources and potabilization processes, reducing network losses, investing in digitalisation and smart metering, and augmenting water supply to the islands located in the service area through desalination. The Project contributes to the Bank's policy objectives of Sustainable Energy and Natural Resources as well as Climate Action and Environmental Sustainability and is aligned with the Bank's Water Resilience Programme. It addresses a number of market failures by generating positive externalities in the form of environmental and public health benefits, notably through improved potabilization of water sources (affected by heavy metals, such as arsenic, iron, and manganese), improved quality of recipient waters, along with recovery of materials (sands) from wastewater treatment. These benefits are not entirely reflected in water tariffs and would not be realised to the same extent without public intervention.

The Project helps address Italy's persistent investment gap in water services by providing long-term financing on terms more favourable than those available from commercial banks. As an anchor investor, the EIB is expected to strengthen the utility's financial position and attract additional investors, while diversifying its funding base. By lowering funding costs and offering extended maturities, the EIB provides tangible financial value while supporting timely and effective implementation of the investment programme. The project would not have been carried out (to the same extent) by the EIB without the InvestEU support.

The upgrade of drinking water and sanitation infrastructure will result in positive environmental impacts. The operation will contribute to the continuous alignment with the requirements of the applicable EU Directives in the water sector, notably the Drinking Water Directive (2020/2184/EU), the applicable Urban Wastewater Treatment Directive (91/271/EEC or 2024/3019/EU, as applicable) and the Water Framework Directive (WFD) (2000/60/EC). Where and if applicable, the requirements of the Environmental Impact Assessment (EIA) Directive 2011/92/EU as amended by Directive 2014/52/EU, the Strategic Environmental Assessment (SEA) Directive 2001/42/EC, the Birds Directive 2009/147/EC and the Habitats Directive 92/43/EEC will be respected. The project is expected to contribute to EIB's climate action and environmental sustainability objectives, in particular to climate adaptation and sustainable use and protection of water resources. Negative environmental and social impacts are expected to be temporary (e.g. occupation of public and private space, safety hazards during construction, traffic disruption, and noise) and will be addressed as part of the planning for the implementation of each scheme. With regard to social matters, the promoter will also be required to comply with all relevant applicable legislation.

The promoter has to ensure that contracts for the implementation of the project have been or will be tendered in accordance with the relevant applicable EU procurement legislation, Directives 2014/23/EU and/or 2014/24/EU 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 EU Official Journal, as and where required.