The project, which foresees regionalization of the selected water utilities by expanding their operations into neighboring localities, is designed to become a pilot scheme with demonstration effects. The NIF grant contribution to the project was critical for its successful implementation considering the severe local affordability constraints of the country. Signed in 2010, project implementation has been notably delayed due to the difficulties setting up the Project Management Unit (PMU), which started operating in early August 2011. The first disbursement under the project towards the compliant utilities was made in October 2012 and since then disbursements have been processed on an ongoing basis. As of end of 2012 nearly € 3m have been disbursed (i.e. nearly € 1m from each of the EU NIF, EBRD, and EIB). Physical progress of the project differs from municipality to municipality and works continue.