The Baltic Sea becomes a better place for life

The Southwest Wastewater Treatment Plant (SWTP) in St. Petersburg is now in operation.

Treatment plant

NIB’s loan of EUR 45 million was the largest individual contribution to the project. The inauguration was a top-level political event. Yet there is still much to be done in order to completely eliminate discharges of untreated sewage from the Baltic Sea region’s largest metropolis into open waters.

The completion of SWTP substantially reduces the effluent of untreated wastewater discharged into the Gulf of Finland and the Baltic Sea. Although the combined capacity of the wastewater treatment plants is now sufficient to treat all sewage, the city cleans only 85% of its wastewater, still plainly below the EU recommended 95%.

The remaining wastewater pours into the Gulf of Finland through hundreds of outlets in St. Petersburg’s well-worn sewerage network. Life in the Baltic Sea is still in danger, not to talk about the consequences of pollution in the city’s past-until 1977, the then Leningrad had been pouring all its mess directly into the sea.

“Yet, even at this level, the wastewater treatment carried out by the region’s largest point source polluter—St. Petersburg—is helping to make the Baltic Sea a better place for wildlife and humans,” says Johnny Åkerholm, NIB’s President and CEO.

Inauguration

President Halonen, President Putin and Prime-Minister Persson stressed the project’s historical importance as an outstanding example of cooperation in northern Europe. Governor Matviyenko was specific: “This international project has created an important precedent in that (…) different countries, European financial institutions and 856 private companies have all united their efforts to build this environmental facility, the biggest of its kind in recent years and the best in Europe.”
Revived project

A mouse click that started the huge sewage washing machine is a result of a EUR 194 million investment and five years of hard work. Construction work on SWTP started in 1987 but the project was suspended due to a lack of funds.

The project was revived in 2000, when NIB was invited by the municipal water supply utility Vodokanal St. Petersburg to coordinate a feasibility study on the completion of the treatment plant. The study was initiated and financed by the Finnish Ministry of the Environment and the Swedish Agency for International Development Cooperation-Sida.

On the basis of the study, NIB started tailor-making the financial structure of the project. The Bank invited major Nordic construction companies to consider a Public Private Partnership model for the completion and operation of the wastewater treatment plant. As a result, three Nordic companies-Swedish Skanska, NCC and Finnish YIT-together with the Nordic Environment Finance Corporation NEFCO and Vodokanal St. Petersburg established a special purpose enterprise, Nordvod.

The owners invested risk capital in the amount of EUR 15 million into Nordvod. The same owners have set up Ecovod, another special-purpose enterprise which will be operating the treatment plant for the coming 12 years.

In NDEP framework

The treatment plant is the first project finalised within the framework of the Northern Dimension Environmental Partnership (NDEP) investment programme. The costs of the project were covered by a combination of equity, credits, grants and local funding. Under this patronage, the project was able to attract EUR 50 million in donor funding from Finland, Sweden, the European Commission and the NDEP Support Fund.

The City of St. Petersburg and Vodokanal invested EUR 15 million in the influent infrastructure of the treatment plant.

The building work started in March 2003 and stretched to more than two years.

Aiming at 100%

St. Petersburg wants to treat 100% of its sewage. The city’s authorities are committed to the target.

“We will be the first city in the Baltic Sea region to treat all of its wastewater,” Governor Matviyenko promised on the SWTP inauguration day.

Within the programme called the Neva Direct Discharge Closure Programme, Vodokanal plans to complete sewage collection mains and connect them to the northern treatment plant.

A feasibility study to define the priority investments is to be finalised by the end of 2005. NIB has a lead agency role in this project. The estimated cost of this project is at EUR 300-350 million.