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Project: Strategic Environmental and Social Assessment (Sesa) for the Development of Geothermal Resources in Mbeya and Songwe Regions, Tanzania

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Project: Strategic Environmental and Social Assessment (Sesa) for the Development of Geothermal Resources in Mbeya and Songwe Regions, Tanzania Language: English Original: English PROJECT: STRATEGIC ENVIRONMENTAL AND SOCIAL ASSESSMENT (SESA) FOR THE DEVELOPMENT OF GEOTHERMAL RESOURCES IN MBEYA AND SONGWE REGIONS, TANZANIA COUNTRY: UNITED REPUBLIC OF TANZANIA STRATEGIC ENVIRONMENTAL AND SOCIAL IMPACT ASSESSMENT SUMMARY Date: JUNE 2017 Team Leader: Stella Mandago, Senior Energy Specialist, RDGE1 Team Members: F. Oku, Senior Environmental Specialist, SNDI.1 RDGE E. Auer, Senior Social Development Specialist SNDI.1 RDGE Appraisal Team Divisional Manager: Negash Habtemichael, Engedasew Regional Director: Gabriel Negatu STRATEGIC ENVIRONMENTAL AND SOCIAL ASSESSMENT [SESA] SUMMARY Project Title: TANZANIA GEOTHERMAL Project Number: P-TZ-FZ0-001 Country: TANZANIA Department: RDGE Division: RDGE1 Project Category: 1 1. INTRODUCTION Tanzania has traditionally depended on hydropower and fossil fuel for power generation until the recent past when the use of Natural Gas for power generation took a lead in the power generation mix1. The current generation mix is unsustainable largely due to persistent and frequent droughts and unpredictable fossil fuel price variations which have adversely resulted in severe power supply shortages in the country with detrimental effect oN the country’s economy. Due to this challenge, the government has decided to improve the generation mix by using other locally available sources of energy including Geothermal which is independent of the influence of weather cycles and fossil fuel price variations2. In order to fast-track the Geothermal development in Tanzania, the Government of Tanzania (GOT) established the Tanzania Geothermal Development Company Limited (TGDC) in December 2013 as a subsidiary Company of TANESCO with institutional mandate for facilitating and expediting realization of geothermal energy development in the country. The proposed programme is aimed at assessment of geothermal resources, confirmation of the potential reservoirs by integrating the data from geophysical, geochemical and geological information of the identified reservoirs. Currently about 50 geothermal potential sites have been identified in the country by using an analog method, with an estimated geothermal potential of more than 5,000MW. Four of the most promising sites for geothermal energy include: 1) Lake Natron in Arusha Region-1000 MW; 2) Lake Ngozi and Songwe River basin in Mbeya and Songwe Regions, respectively - 800 MW; 3) Luhoi Spring site, with potential of 50 – 100MW located in Lower Rufiji Valley, Utete District; and 4) Kisaki in Morogoro 600 MW. Tanzania plans to focus on geothermal potentials in the Mbeya and Songwe Regions, specifically at Ngozi, Songwe, Kiejo/Mbaka and Mampulo/Kasumulo for the development of geothermal energy. These sites were selected as first candidate sites as they appeared to have high subsurface temperatures compared to the other sites. 1 As of February, 2017, the total power installed capacity in the country (grid and off grid) is 1,445MW where, 615MW (43%) is from Natural Gas, 567MW (39%) from hydropower, 252MW (17%) from Fossil (HFO, GO, and Diesel) and 11MW (<1%) from Renewables Energies 2 PSMP (2016), Power Sector Master Plan of 2016 (PSMP 2016) SESA Summary Page 1 of 33 Tanzania Geothermal Development Project, Tanzania A Strategic Environmental Social Assessment (SESA) has been developed by TGDC in compliance with national and international development partners E&S policy requirements. This SESA summary highlights the mechanisms within the SESA to identify potential environmental and social impacts associated with the upstream initial exploration phase of the programme and propose appropriate mitigation and monitoring measures within a robust ESMP embedded within the SESA to avoid, minimise and/or compensate for any residual environmental and social impacts associated with the works. 2. POLICY LEGAL AND ADMINISTRATIVE FRAMEWORK The SESA has been carried out in accordance with applicable environmental, social and power sector policies, standards, regulations and legislation in Tanzania as well as relevant international ratified conventions. Environmental Regulations in Tanzania are vested in two main Institutions; the Division of Environment (DoE) under the Vice President Office (VPO) and the National Environmental Management Council (NEMC). The Division of Environment provides policy and technical backup and executes the overall mandate of the Ministry responsible for environment while the NEMC undertakes monitoring and compliance enforcement duties following clearance of EIA/ESIAs. The Programme requires environmental and social compliance with both primary and secondary national legislative requirements and applicable international development partner’s E&S policies such as the AfDB’s Integrated Safeguard Systems (ISS, 2014), the International Finance Corporation’s Sustainability Framework, 2012 and Equator Principles III. The applicable national primary legislation include; National Environmental Policy (1997), The Environmental Management Act 2004, Strategic Environmental Assessment Regulations 2008, National Environmental Standards Compendium (NESC) 2009, Land Acquisition Act 1967, Land Act & Village Land Act 1999, Forestry Act 2002, The Wildlife Conservation Act 2009, the Water Resources Management Act, 2009 and the Employment and Labor Relation Act, 2004. The applicable national secondary legislation include National Energy Policy, 2015, Electricity Act, 2008, Energy and Water Utilities Regulatory Authority Act, 2003, Industrial and Consumers Chemicals (Management and Control) Act, 2003, Sustainable Industrial Development Policy, 1996, The Small and Medium Enterprises Development Policy, 2003, The Community Development Policy, 1996, National Gender Policy 2002, The National Transport Policy, The Livestock Policy, The Agriculture Policy of Tanzania and Agriculture Sector Development Programme (ASDP), Mineral Policy, 2009, National Tourism Policy, 1999, Human Settlement and Development Policy of 2000, and The National Investment Promotion Policy, 1996. The Scoping report for the SESA was registered with the NEMC in January 2016 and the final draft of the SESA has been registered with the DoE of VPO accordingly in June 2017. AfDB’s Operational Safeguard Review The project has been assigned a category 1 by the African Development bank in line with the guidelines within the bank’s ISS because the cumulative potential environmental and social impacts associated with the Exploration phase of the works (for prioritized sites 1, 3 and 5) which the Bank intends providing funding for, could be significant and irreversible. Furthermore some of the project works (provision of access roads and temporary water pipelines) could potentially result in the displacement of more than 200 people. SESA Summary Page 2 of 33 Tanzania Geothermal Development Project, Tanzania Consequently Operational Safeguards (OS) 1 on Environmental Assessment have been triggered because the component activities have the potential to generate significant environmental and social impacts to identified receptors within its area of influence. Operational Safeguard (OS2) has also been triggered because it could displace about 445 persons. OS 4 on Pollution Prevention and Hazardous Substances is triggered since construction will involve use of fuels and possibly some hazardous materials. OS 5 on Labor, Working Conditions, Occupational Health and Safety is applicable since the construction will involve a significant number of construction workers. It is worth mentioning however, that the potential environmental and social impacts associated with the proposed works of the exploration phase in isolation are mostly site specific, limited in scope and could be managed via a robust ESMP. Site specific ESMP has therefore been developed to manage the exploratory phase works on the first three prioritised candidate sites (1, 3 & 5) to comply with the triggered applicable International Lenders’ and national policies. A Resettlement Action Plan (RAP) is being prepared to address the potential impacts associated with displacement of Project Affected Persons (PAPs; about 427 PAPs will have economic impacts –farms- and about 18 PAPs will have physical impacts -houses and graves). 3. PROGRAM DESCRIPTION AND JUSTIFICATION Geological, geochemical and geophysical surface studies within Mbeya and Songwe regions, suggest that the Ngozi Geothermal prospect could be favorable for power generation. The proposed programme is aimed at assessment of the geothermal resources, confirmation of the potential reservoirs by integrating the geophysical, geochemical, geological and drilling techniques. Studies show that resources with reservoir temperature above 150°C can be utilized for power generation if sufficient volumes of water is available and resources with reservoir temperature lower than 150°C can be used directly for various purposes such as tourism including swimming pools, fish farms, agricultural activities such as drying of crops are recommended projects. TGDC proposes to drill exploration wells as a part of the geothermal development programme to confirm the amount and nature of the Ngozi geothermal resource and to improve/validate the existing geoscientific model. Measured and calculated subsurface temperature, observed fluid composition and well test results, revised volumetric assessment and construction of preliminary numerical model will enable further scoping of a possible geothermal power utilization projects and geothermal direct uses in case temperature is not viable
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