Armenia: Warmer Winters for Students and Poor Families

Published: Wed, 09 Sep 2009 18:48:52 GMT

After the devastating effects of the 1988 earthquake, newly independent Armenia abruptly fell into a severe energy crisis. Heating in residential and public buildings was cut. This was devastating, because the average lows from December through March are far below zero degrees Celsius—even the average high in January is -2 degrees Celsius. Severe winters—and much suffering—ensued. People installed old-style chimney ovens in homes, which defied safety rules; and anything, from household waste to wood from illegal logging, was being burned. The result was massive deforestation, indoor and outdoor air pollution, and serious health consequences. Since the mid-1990s, following some energy reforms, households switched to electric or natural gas heat. However, this was not easily affordable for the poor, nor was it installed in most schools.


The IDA-financed Armenia Urban Heating Project was launched in 2005 to provide efficient, safe, and affordable heating technologies in urban schools and multi-apartment buildings. It mobilized communities and the private sector to develop a better enabling environment for heating services. It increased financing options, including loans to homeowner associations and municipalities, as well as grants for the poorest households. Furthermore, the project installed gas-based heating systems and basic thermal rehabilitation in urban schools.


The project reached 56,000 students in 97 schools in 47 towns as well as 5,000 households in multi-apartment buildings with new, safe heating.


Highlights:
- Safe sources increased. Use of safe, clean, and affordable gas-based heating solutions substantially increased among households in urban multi-apartment buildings—from 11 percent in 2004 to more than 45 percent in 2009.

- Missed schooldays decreased. Urban schools with rehabilitated heating systems restored comfortable indoor temperatures. As a result, there were no idle classroom-days during the 2008-09 heating season.

- Private sector galvanized. The number of private entities engaged in the heating business more than tripled—from 20 in 2004 to 73 in 2008.- Access expanded for the poor. 4,600 of the poorest households living in urban multi-apartment buildings received grants to gain access to improved gas and heating services. This led to tangible improvements in their living standards.

- Loans improved access. The availability of heating loans enabled middle-income households to obtain gas-based heat which they could not have otherwise afforded. Increasing use of safe and clean heating technologies brings significant benefits to the society at large by reducing negative externalities (fires, explosions of buildings, deterioration of building stock due to inadequate and uneven heating, deforestation and outdoor pollution).

- A new system established. Heating loans have become a standard financial product for financial institutions—even those that did not participate in the project.

IDA contributed US$15 million. (The project’s total cost is US$21.95 million.)


The project attracted US$2.9 million from the UN Development Program’s Global Ecological Fund. The Global Partnership for Output-Based Aid, a multi-donor trust fund administered by the World Bank Group, was instrumental in contributing US$3.1 million to provide capital grants to 4,600 of the poorest households.


The project is expected to reach completion by mid-2010. To ensure sustained progress, the government will need to involve schools in maintaining and operating their new heating systems. This will ensure ownership for the long term.


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