Environmental Assessment Report

Initial Environmental Examination Project Number: 40683 September 2010

People’s Republic of : Risk Mitigation and Strengthening of Endangered Reservoirs in Province Project

Prepared by the Shandong Province Government for the Asian Development Bank (ADB)

[City, Country]

ThPreparedis initial environmentalfor [Executing examination Agency] report is a document of the borrower. The views expressed herein do not necessarily represent[Implementing those of ADB’s Agency] Board of Directors, Management, or staff, and may be preliminary in nature.

CURRENCY EQUIVALENTS (As of 8 April 2010)

Currency Unit – Yuan (CNY) CNY1.00 = $0.1465 $1.00 = CNY6.826

ABBREVIATIONS

ADB – Asian Development Bank CNY – Chinese yuan COD – Chemical oxygen demand EIA – environmental impact assessment EIRR – economic internal rate of return EIRF – environmental impact registration form EIS – environmental impact statement EMC – environmental management consultant EMP – environmental management plan EMS – environmental monitoring station EPB – environmental protection bureau GDP – gross domestic product IA implementing agency IEE initial environmental examination IEM – independent environmental monitor LPMO – Local project management office MEP – Ministry of Environmental Protection PPMO – provincial project management office PRC – People’s Republic of China RP – resettlement plan SPEPD – Shandong provincial Environmental Protection Department SPG – Shandong provincial government SPS – Safeguard Policy Statement SS – suspended solids TEIAR – tabular environmental impact assessment report

WEIGHTS AND MEASURES

ha – hectare kg/d – kilogram per day km – kilometer km2 – square kilometer m – meter m2 – square meter m3 – cubic meter m3/d – cubic meters per day m3/s – cubic meters per second mg/m3 – milligrams per cubic meter mm – millimeter mu – unit of land area equal to 1/15 ha or 667 m2

NOTE

In the report, ―$‖ refers to US dollars.

CONTENTS

MAP I. INTRODUCTION 1 II. POLICY, LEGAL, AND ADMINISTRATION FRAMEWORK 2 A. National and Local Legal Framework 2 B. Aplicable International Environmental Agreements 4 III. DESCRIPTION OF THE PROJECT 4 IV. THE SUMMARY OF THE SUB-PROJECTS EIA REVIEW 7 V. DESCRIPTION OF ENVIRONMENT 8 A. Physical Enviroment 8 B. Ecological Environment 13 C. Environmental Quality 14 D. Social Environment 14 VI. ANTICIPATED ENVIRONMENTAL IMPACTS AND MITIGATION MEASURES 16 A. Incremental Environmental and Social Benefits 16 B. Potential Adverse Impact and Mitigation Measures during Construction Phase 17 C. General Mitigation Measures 20 D. Biodiversity Conservation and Sustainable Natural Resource Management 20 E. Pollution Prevention and Abatement 22 F. Land Acquisition and Resettlement 25 G. Cumulative Impacts 25 H. Cultural Relics and Physical Culture Resources 25 I. Potential Sdverse Impact and Mitigation Measures during Operation Phase 26 VII. ANALYSIS OF ALTERNATIVES 26 A. No Project Alternative 26 B. Discussion of Alternative Sollutions 26 VIII. ENVIRONMENTAL ECONOMIC ASSESSMENT 27 A. Overall Benefit 27 B. Environmental Protection Investments 27 C. Environmental Benefits 27 D. Economic Internal Rate of Return 28 IX. INFORMATION DISCLOSURE AND PUBLIC CONSULTATIONS 28 A. Information Disclosure and Public Consultations to Date 28 B. Consultation Results 29 C. Future Information Disclosure and Public Consultation Program 30 X. GRIEVANCE REDRESS MECHANISM 30 XI. ENVIRONMENTAL PLANNING AND MANAGEMENT 30 A. Mitigation Measures 30 B. Organizational Structures for Environmental Management 30 C. Inspection, Monitoring, and Reporting 31 D. Mechanism for Feedback and Adjustment 32 E. Environmental Management Capacity in the Subproject Municip[ality 32 XII. CONCLUSION AND RECOMMENDATION 32

APPENDIXES 1. Project Description 35 2. Environmental Management Plan 40

MAP OF RESERVOIR LOCATIONS, SHANDONG PROVINCE

MUYU ▼

RENHE ▼

SONGSHAN ▼

QIANGKUANG ▼ HUACUN ANJING ▼ ▼ LONGWANTAO▼ ▼ YANGZHUANG

SHIZUIZI ▼

ENDANGERED RESERVOIRS IN SHANDONG PROVINCE

LOCATION OF SUBPROJECTS

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I. INTRODUCTION

1. This initial environmental examination (IEE) presents the potential environmental impacts and appropriate mitigation and enhancement measures for the Risk Mitigation and Strengthening of Endangered Reservoirs in Shandong Province Project. The IEE has been prepared in accordance with the requirements of the Asian Development Bank (ADB) Safeguard Policy Statement (SPS) (2009) and the People’s Republic of China (PRC) Environmental Impact Assessment (EIA) Law (2003)1, and is based on separate EIA reports, site inspections, technical reports2, and community consultations.

2. Shandong province has some of the most serious reservoir safety issues in the PRC. Of the 5,820 reservoirs within the province, 4,114 are in the most unsafe Class III category, equivalent to 71% of the total, which is the highest in the PRC. Since 1966, 255 reservoirs collapses have been recorded in the Shandong province, resulting in 225 deaths. The reservoir collapse ratio in Shandong province is 4.38%, exceeding the national average of 4.02%/year.

3. Reservoirs in the PRC play a major role in flood control, irrigation, hydropower generation, and water supply. The design of many reservoirs was based on the hydrometeorology of the watershed and downstream water demand. Currently, however, many endangered reservoirs could not store water up to the designed level due to leakage, instability of water-retaining dams, and lack of adequate spillway capacity for emergency discharge of rapidly rising floodwaters. As a result, these endangered reservoirs are inadequate to control floods, supply irrigation water, generate hydropower, and provide year-round domestic water to the population. Strengthening the existing reservoirs will enhance their capacity to perform the above functions at a lower cost and with less adverse impact on the environment and people, compared with constructing new reservoirs.

4. The Shandong provincial government (SPG) recognized the urgent need for reservoir rehabilitation. A total of 137 class III reservoirs in Shandong province have been included in the National Reservoir Strengthening Program.3 SPG also formulated its original plan to rehabilitate unsafe reservoirs which are not included in the national program. 4 However, SPG is facing difficulties in terms of technologies and financing. SPG has also recognized importance of proper management of rehabilitated reservoirs for continuous safety and effective use. SPG needs sound methodology to efficiently and effectively rehabilitate a large number of unsafe reservoirs within the limited provincial budget. SPG also needs to properly manage rehabilitated reservoirs for their continuous safety and effective use. SPG has requested a loan from ADB to establish sustainable reservoir rehabilitation and management models, through rehabilitation, management, monitoring, and evaluation of model reservoirs. ADB's assistance will also enable Shandong province to access international expertise and experience in reservoir rehabilitation and management. The established models will be used in Shandong province and replicated throughout the PRC

5. This IEE provides an assessment of potential environmental impacts and risks associated with the proposed reservoir strengthening works at nine sites, and includes (i) a summary of the local, national, and international policies, standards, and guidelines; (ii) due diligence review of existing environmental impact assessment undertaken to meet local approval requirements;5 (iii) description of the project and anticipated environmental impacts and mitigations measures; (iv) environmental economic assessment;

1 PRC. 2003. EIA Law of the People’s Republic of China. People’s Congress, Beijing, PRC. 2 Feasibility study report and preliminary design report for each of the nine reservoirs which were approved by the Shandong Provincial Development Reform Committee. 3 The National Reservoir Strengthening Program was formulated by the Ministry of Water Resources in 2001 to advance reservoir strengthening with financial assistance from the government. 4 Notice for the Acceleration of Risk Mitigation and Strengthening of Endangered Reservoirs and River Improvement (issued by the Shandong Province People's Government, LUZHENGFA [2008] No.9.) 5 A due diligence report (DDR) was completed as part of the IEE for the project. The DDR aims to provide review of the nine subproject EIA reports prepared by local design institutes. The review has been undertaken to assess compliance with domestic laws, regulations, and policies, along with the APS and international good practice. The DDR is available at request.

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(v) information disclosure, consultation and participation, (vi) grievance redress mechanism, and (vii) a detailed environmental management plan, including implementation schedule and performance indicators.

6. The proposed reservoir strengthening works have been classified as Category B6 by ADB.

II. POLICY, LEGAL AND ADMINISTRATION FRAMEWORK

A. National and Local Legal Framework

7. This IEE has been undertaken within the PRC national and local legal and institutional framework, which includes the PRC laws, regulations and standards listed below along with applicable provincial and local ordinances.

(i) PRC Law on Environmental Impact Assessment, 2003 (ii) PRC Law on Environmental Pollution Prevention and Control of Solid Wastes, 1995, amended in 2005 (iii) PRC Water Law, 2002 (iv) PRC Law on Air Pollution Prevention and Control, 2000 (v) PRC Law on Protection of the Marine Environment, 1999. (vi) PRC Law on Ambient Noise Pollution Prevention and Control, 1997 (vii) PRC Law on Water Pollution Prevention and Control, 1984, amended in 1996 and 2008 (viii) PRC Law on Water and Soil Conservation, 1991 (ix) PRC Law on Environmental Protection, 1989 (x) PRC Law on Protection of Wild Fauna, 1989 (xi) Management Guideline on EIA Categories of Construction Projects, Ministry of Environmental Protection, 2008 (xii) Guideline on Jurisdictional Division of Review and Approval of EIAs for Construction Projects, State Environmental Protection Administration, 2003 (xiii) Guideline on Jurisdictional Division of Review and Approval of EIAs for Construction Projects, 2003 (xiv) Regulation on Implementation of the PRC Law on Water and Soil Conservation, State Council, 1993 (xv) Management Guideline on Preparation of Water and Soil Conservation Plans for Construction Projects, Ministry of Water Resources, State Planning Commission, National Environmental Protection Agency, 1994 (xvi) Management Guideline on Preparation, Submission, Review and Approval of Water and Soil Conservation Plans of Construction Projects, Ministry of Water Resources, 1995 (xvii) Regulation on Environmental Protection of Capital Construction Projects, State Council, 1998 (xviii) Guideline on Water and Soil Conservation for Highway Projects, Ministry of Water Resources and Ministry of Communications, 2001 (xix) Interim Guideline on Public Participation in EIA, State Environmental Protection Administration, 2006 (xx) Technical Guideline on EIA, State Environmental Protection Administration, 2003. (xxi) (HJ/T 2.1-93) Guideline on EIA Review and Approval Procedure for Construction Projects, State Environmental Protection Administration, 2006 (xxii) HJ/T2.-1-93: Technical Guideline for Environment Impact Assessment (General Provisions) (xxiii) HJ/T2.-2-93: Technical Guideline for Environment Impact Assessment (Air Quality).

6 Category B (OM 20): Projects judged to have some adverse environmental impacts, but of lesser degree and/or significance than those for category A projects. An initial environmental examination (IEE) is required to determine whether or not significant environmental impacts warranting an EIA are likely. If an EIA is not needed, the IEE is regarded as the final environmental assessment report. Category C (OM 20): Projects unlikely to have adverse environmental impacts. No EIA or IEE is required, although environmental implications are still reviewed.

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(xxiv) HJ/T2.-3-93: Technical Guideline for Environment Impact Assessment (Water Quality) (xxv) JTJ005-96: Guideline for Environmental Impact Assessment of Highway Construction Projects (xxvi) HJ/T19-97: Technical Guideline for Environmental Impact Assessment (Non-Polluting Ecological Impact) (xxvii) HJ/T2.-4-95: Technical Guideline for Environmental Impact Assessment (Acoustical Environment) (xxviii) HJ/T19-1997: Technical Guideline for Environmental Impact Assessment-ecological impact (xxix) HJ/T 19-1997: Technical Guideline for Environmental Impact Assessment – Hydropower and Water Resources Construction Project

8. The applicable national environmental standards include:

(i) Integrated Wastewater Discharge Standard (GB8978-1996), 1998 (ii) Integrated Emission Standards of Air Pollutants (GB16297-1996), 1997 (iii) Environmental Quality Standard for Surface Water (GB3838-2002), 2002 (iv) Ambient Air Quality Standard (GB3095-1996), 1996 (v) Standard of Environmental Noise of Urban Area (GB3096-93), 1994. (vi) Environmental Quality Standard for Soils (GB15618-1995), 1996. (vii) Technical Standards on Water and Soil Conservation Plans of Construction Projects (SL204-98), Ministry of Water Resources, 1998.

9. Article 16 of the PRC EIA Law (2003) stipulates that an environmental impact statement (EIS) is required for any capital construction project producing significant environmental impacts, so as to provide a comprehensive assessment of these potential environmental impacts. On 2 September 2008, the Ministry of Environmental Protection (MEP) released the Management Guideline on EIA Categories of Construction Projects, which came into effect on 1 October 2008. According to this guideline, a project is classified into one of the following three categories:

(i) Category A: Projects with significant adverse environmental impact, an EIS is required. (ii) Category B: Projects with adverse environmental impacts which are of lesser degree and/or significance than those of Category A; a tabular environmental impact assessment report (TEIAR) is required. (iii) Category C: Projects unlikely to have adverse environmental impact; an environmental impact registration form (EIRF) is required.

10. The EIS and TEIAR under PRC EIA regulations are similar to the IEE and the EIRF is equivalent to the ADB Category C under the ADB SPS. Under PRC EIA Law (2003), public consultations are not required for TEIARs and EIRFs.

11. The guideline is an amendment to the 2002 Management Guideline of Environmental Protection Categories of Construction Projects. The new Guideline provides detailed classifications of EIAs into 23 general categories and further into 198 subcategories, on the basis of nature of project (e.g., water resources development, agriculture, energy, waste management), scale of project (e.g., wastewater treatment plant with a capacity of 5,000 m3/d) and environmental sensitivity of the project site (e.g., protected nature and cultural areas). According to the Management Guideline of Environmental Protection Categories of Construction Projects (2002), the proposed project should be classified into the subcategories of agriculture, forest and water resources development project.

12. MEP's Guideline on Jurisdictional Division of Review and Approval of EIAs for Construction Projects, 2003, provide two prescribed lists of projects for which the EIAs will require review and approval. The responsibilities for review and approval of EIAs for construction projects not on the lists rest with provincial and municipal environmental protection bureaus (EPBs). The guideline was amended in 2009

3 4 to include a list of construction projects for which EIAs will require review and approval by the MEP, and a list of construction projects for which EIAs will be delegated to provincial EPBs.

13. EPBs controlling the nine subprojects consist of five sections and three institutions. The five sections cover EIA, pollution control and planning, regulatory affairs and public education, public information office, and general administration. The three institutions include the environmental monitoring station (fully government funded), inspection and enforcement brigade (fully government funded), and the environmental science research institute (partially government funded).

B. Applicable International Environmental Agreements

1. ADB Guidelines and Policies

14. The SPS provides a basis for this IEE. The SPS consists of three operational policies on the environment, indigenous peoples, and involuntary resettlement. With respect to environment, these policies are accompanied by ADB Operations Manual on Environmental Consideration on ADB Operations (2006). The policy promotes international good practice as reflected in internationally recognized standards such as the World Bank Group’s Environmental, Health and Safety Guidelines.

III. DESCRIPTION OF THE PROJECT

15. The proposed project will rehabilitate 9 reservoirs, as shown in the map of subproject locations and summarised in Table 1, to meet modern technical standards for safety. Among them are 2 large and 7 medium -sized reservoirs. Six of these reservoirs utilize clay-core earth-fill dams, 1 reservoir utilizes a homogeneous earth-fill dam, 1 reservoir utilizes a clay-core earth-fill dam combined with a homogeneous earth-fill dam, and 1 reservoir utilizes a masonry dam combined with a homogeneous earth-fill dam.

16. A detailed description of each reservoir and the proposed rehabilitation works for each reservoir is provided in Appendix 1.

17. The proposed project will contribute to integrated water resources management by restoring reservoirs’ functions originally designed for flood control, irrigation, and water supply; and therefore, is in line with the priorities of ADB’s water policy in promoting integrated water resources management. The proposed project is also in line with ADB's country partnership strategy for the PRC, which prioritizes environmental sustainability through more effective natural resources management, and supports the Government’s objectives in the water sector.

Table 1 - Summary Details of Nine Reservoirs

Reservoir City / Location County Size Category Total Catchm Reservoir ent Volume Area (million m3) (km2)

Qiangkuang Southeast of Qiangkuang Village, Reservoir Zhigou Town and in the upriver of Large 328.0 656 Weihe River Basin

Renhe Weifang Middle reaches of Renhe River, part Reservoir of the Zihe River, a tributary of the Medium 26.32 80 Xiaoqing River Water System Shizuizi 500m south of Shizuizi Village, Reservoir and upstream of the Medium 10.96 49.5 north tributary of the Shizi River

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Songshan Weifang 25 km southwest of , on Reservoir the tributary of Mihe River and upper Medium 56.28 151 reaches of Shihe River, Longwantao Upstream of Ji Rive, a tributary of Reservoir Xisi River, Nansi Lake System, Huai Medium 52.15 143 River River Basin Anjing 20 km east of Reservoir Medium 13.35 35.12 Yangzhung Linyi On the Ziqiu River, in the Northeast Reservoir mountain area of Pingyi County Medium 26.32 36 Huacun Jining Midstream on the Huanggouhe River, Reservoir a tributary of Sihe River in the Huaihe Medium 57.86 143 River Drainage Area, Muyu Midstream and downstream of Reservoir Xianhe River, a branch of Wulong Large 182.7 455 River

18. Based on the Comprehensive Evaluation Report of Safety Appraisal of the Nine Reservoirs and Decisions with Regard to the Safety Appraisal Results of Grade III of Reservoirs issued by Dam Safety Management Center of Ministry of Water Resources (dam file [2006] NO.2506), the major existing problems include: (i) Low capacity of flood control; the current core wall crest elevation is taken as the actual anti-seepage body. This does not meet the relevant requirements. The reservoir’s current flood control capacity is far lower than the normative value. (ii) Dam stability against sliding of the dam cannot meet the requirements. (iii) Spillway is far smaller than the safety discharge of the downstream river-way. When the flow exceeds the once-in-twenty-year floods, it will threaten the safety of people's lives and properties in villages on the two sides of the spillway; (iv) Drainage tunnel is buried under than the dam. The grouted stone masonry is ages-out. The tunnel has fractures and leaks. The inner lining steel tubes rust. The gate and hoist are simple and crude. It has potential safety hazard of contact seepage. (v) Engineering management. (vi) The dams have no observation facilities. The engineering management conditions are not appropriate. 19. The current flood control capacity of the reservoirs are far lower than the current abnormal-use flood standards of hydrological key projects’ danger removal and reinforcement promulgated by Ministry of Water Resources.

20. The project will rehabilitate, manage, monitor, and evaluate the nine reservoirs and, based on the results, establish sustainable reservoir rehabilitation and management models which will be used in Shandong province and replicated throughout the PRC. The major components of the rehabilitation of the nine reservoirs include civil works and procurement of equipment. The civil works and equipment procurement are to be conducted through 66 contracts, out of which 33 contracts are to be fully funded by governments and 33 are to be fully or partially funded by ADB (see Table 2 below).

Table 2 - Civil Works and Equipment Procurement under the Nine Subprojects Scheduled to Commence in 2010 Already Commenceda (To be funded by ADB Loan) (Financed by Governments) Qiangkuang (i) Road and connecting bridge for flood (i) West dam and spillway reinforcement, and

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Scheduled to Commence in 2010 Already Commenceda (To be funded by ADB Loan) (Financed by Governments) Reservoir control their connection pipelines digging work (ii) 2004 continuous auxiliary works for water (ii) New spillway gate and reinforcement of the saving improvement. Total 5102km of upstream spillway pipe lines. (iii) Downstream spillway reinforcement work (iii) 2005 continuous auxiliary works for water and other construction saving improvement. 1.5378 km of (iv) Section 0+000-0+300 of East dam and channel lining. east outlet rebuilding works (iv) 2006 continuous auxiliary works for water (v) Section 0+300 - 0+950 of east dam saving improvement. 3.248km of channel construction lining. (vi) Diaphragm wall of the east dam and (v) 2007 continuous auxiliary works for water management administration facilities saving improvement. 3.5 km of channel lining. (vi) 2008 Continuous auxiliary works for water saving improvement.

Renhe (i) Concrete cut-off works and others (i) Reinforced concrete dam construction Reservoir (ii) Earth dam reinforcement and others (ii) Reinforcement of gravity dam and outlet, and others

Shizuizi (i) Rock-fill dam reinforcement works (i) Earth dam reinforcement works Reservoir (ii) Spillway gate reinforcement works (ii) Spillway reinforcement Works (iii) Administration office building and others Songshan (i) Spillway reinforcement works (i) Dam reinforcement works Reservoir (ii) Metal structure (spillway gate) works and (ii) Earth dam cutting works electricity facilities and installation (for (iii) Outlet equipment spillway operation) (iii) Administration office building Longwantao (i) Spillway reinforcement works (i) Dam reinforcement works Reservoir (ii) Office construction, road improvement, (ii) Outlet reinforcement works and irrigation river channel improvement (iii) Temporary works (lands, temporary road (iii) Spillway gate houses0 (iv) Outlet and metal structure and equipment Anjing (i) Dam impervious construction, (i) Rock works for spillway (excluding the Reservoir administration facilities and flood control bridge) road (ii) Rock works for dam (excluding the dam (ii) Transportation for spillway anti-leakage work) (iii) Dam masonry construction (iv) Equipment for outlet of spillway (v) Administration office equipment Yangzhuang (i) Spillway, jet grouting, administration (i) Rock works for spillway (excluding the Reservoir facilities and flood control road bridge) (ii) Administration office equipment (ii) Rock works for dam (excluding grouting) (iii) Diaphragm wall cut off and dam masonry

Huacun (i) Spillway reinforcement works (i) Dam reinforcement works Reservoir (ii) Spillway gate, outlet, metal structure and (ii) Outlet reinforcement works equipment (iii) Temporary works (temporary road, land (iii) Administration office building and road use and houses) improvement Muyu Reservoir (i) Water supply and heating systems for (i) Dam cut-off works offices, and greening works (ii) Spillway gate construction (ii) Flood management roads, and protection (iii) Spillway excavation and roller bucket wall on both side of river channel (iv) Spillway gate and Metal structure (iii) Hydrology facility and computer control equipment procurement

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Scheduled to Commence in 2010 Already Commenceda (To be funded by ADB Loan) (Financed by Governments) system (v) West outlet, protection wall for dam, and computer monitoring equipment (vi) Dam reinforcement for 0+080-0+310 section, protection wall for upstream, and works for top of the dam. (vii) Protection wall for east outlet and downstream, and drainage system a The civil works and equipment procurement are to be conducted through 66 contracts, out of which 33 contracts are to be fully funded by governments and 33 are to be fully or partially funded by ADB. Not only the contracts to be funded by ADB but also the contracts to be fully funded by governments are/will be covered by ADB due diligence review.

IV. THE SUMMARY OF THE SUBPROJECTS EIA REVIEW

21. With respect to potential environmental impacts, each subproject was classified in consultation with the Shandong Environmental Protection Department (SPEPD) and municipal, city, and/or county EPBs and in accordance with the MEP Management Guideline on EIA Categories of Construction Projects (2009), as shown in Table 3. At the time of this report, all EIA reports had been completed, submitted and approved. In order to assess compliance with domestic laws, regulations, and policies, in accordance with the ADB SPS and international good practice, Due Diligence Report for Works Conducted by Government Using Separately from Project Funds was prepared to provide review of (i) the completeness of each domestic EIA report, and (ii) the civil works commenced being fully funded by governments (see footnote 5).

Table 3 - EIA Classification of Subprojects

Subproject Implementing Agency EIA Type of Review and Date Category EIA Report Approval of Approval Authority Qiangkuang Qiangkuang Reservoir C EIRF City November Reservoir Administration Office EPB 2007

Renhe Reservoir Renhe Reservoir Risk B TEIAR City June Mitigation and Strengthening EPB 2007 Project Office Shizuizi Reservoir Shizuizi Reservoir Risk C EIRF Zhaozhuang October Mitigation and Strengthening Municipal 2009 Project Office EPB Songshan Songshan Reservoir B TEIAR Weifan Municipal March Reservoir Administration Office EPB 2007

Longwantao Longwantao Reservoir C EIRF Sishui County October Reservoir Administration Office EPB 2009

Anjing Reservoir Anjing Reservoir C EIRF Pingyi County October 2009 Administration Office EPB Yangzhuang Yangzhuang Reservoir C EIRF Pingyi County October Reservoir Administration Office EPB 2009

Huacun Reservoir Huacun Reservoir C EIRF Sishui County October Administration Office EPB 2009 Muyu Reservoir Risk Mitigation and B TEIAR City EPB February Strengthening Project Office 2007 Notes: EIA = environmental impact assessment, EIRF = Environmental Impact Registration Form, EPB = Environmental Protection Bureau, TEIAR = tabular environmental impact assessment report

22. A due diligence review of each TEIAR or EIRF report was undertaken as a part of this IEE, including review of the completeness of each EIA report with respect to PRC laws, regulations, and

7 8 guidelines, international good practices, and ADB requirements as detailed in the SPS 2009, and comments on the implementation of the TEIAR or EIRF requirements during works which commenced being fully funded by governments (see Table 2).

23. The findings from the due diligence review indicate that there are four major gaps between the PRC's requirements for EIA reports and ADB's requirements for environmental safeguard. These are (i) limited detail on the proposed project works, (ii) no discussion of alternatives, including the no-project option, (iii) lack of public consultation and information disclosure; and (iv) absences of environmental economic analysis. Other minor omissions from the subproject EIA reports include a grievance redress mechanism and comments on green house gas emissions and mitigation measures. This IEE addresses these assessment and information gaps, and provides the required additional assessment and consultation in accordance with the SPS 2009.

24. Based on observations from site inspections conducted in September to November 2009, the following conclusions are made with regard to environmental management plan implementation by IAs and contractors for the construction activities which commenced being fully funded by governments (see Table 2). Future ADB project due diligence described in the IEE report and EMP will cover all project facilities including those fully funded by governments to the extent required to mitigate overall project impacts.

(i) The ongoing construction activities fully financed by governments have fulfilled the environmental protection and management obligations required by both the PRC and ADB. (ii) The implementing agencies (IAs) of all nine reservoirs and the contracts have largely fulfilled their obligations in implementing the mitigation measures in their construction contracts and schemes. (iii) Through the implementation of these measures, the negative impacts ascribed by the construction activities have been reduced to a minimum level and at temporary and construction site size. (iv) However, to a certain extent, there have still been unavoidable impacts on the environment, but these unavoidable impacts are within an acceptable level, are temporary, and are largely confined to the construction site. (v) At the time of this report, there has been no any environmental complaint from the local communities and local EPBs.

V. DESCRIPTION OF ENVIRONMENT

A. Physical Environment

1. Qiangkuang Reservoir

25. Geology and Geomorphology. Qiangkuang Reservoir, located in the upstream area of Weihe River, has rain collecting area of 656 km2. The east sub-reservoir blocks two branch tributaries of Weihe River, Gaoze River and Zhonggu River, with catchment area of 386 km2; while the west sub-reservoir blocks the main river channel of Weihe River, with catchment area of 270 km2. The east sub-reservoir catchment is 29.6 km long with mean main channel gradient of 0.262%; meanwhile, the west sub- reservoir catchment is 30.1 km long with mean main channel gradient of 0.22%.

26. The reservoir area is located in Yishu Fault Zone, the south east part of Sino-Korean Platform. The exposed strata in the Weihe River basin mainly consist of bedrocks including cretaceous terrestrial strata, lava and volcanic rock, and quaternary thick unconsolidated layers at the foot of mountain, or at the bottom land among hills, or at river channel and its both sides.

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27. The reservoir area, locating in the , Municipality, is the denudate hilly area of weak incision structure in the east Shandong. Totally, the area is high in the south and low in the north, consisting of low and round mountain-hilly area and wide U-shape river valley area.

28. Climatic, Hydrological and Flood Features. The whole basin experiences a warm, wet, and monsoon climate with features of rainless and drought spring, hot and rainy summer, drought and rainless autumn and cold and rainless winter. Mean annual temperature is 12.3 oC.

29. Average annual rainfall reaches 707.6mm based on measured data of rainfall from 1961 to 2005. However, seasonal and average annual rainfall is quite different. Rainfall mainly concentrates in flood season; the mean annual flood-season rainfall reaches 502.2 mm, 71.7% of mean annual rainfall. The annual maximum 24 hour rainfall reaches 100.7 mm, and the maximum 72h rainfall reaches 123.6 mm.

2. Renhe Reservoir

30. Geology and Geomorphology. Renhe Reservoir, with control area of 80 km2, is located in the middle reach of Renhe River, the tributary of Zihe River of Xiaoqinghe river system.

31. The reservoir area, locating in the Middle Platform of Shandong Province, has a simple geologic structure with a major faulted structure of Shangwujing Fault. The reservoir area has two comparatively large faults, one of which locates in the Juzi Valley, the west of Juzi Village, extending virtually from east to west with a slight wave shape; the other locates near the woodland, extending actually from east to west with two branches in its west, and vertical occurrence and fault angle of 40o.

32. The occurrence of stratum in the reservoir are pretty flat with exposed stratum of Gushan Group, Changshan Group and Fengshan Group of Upper Ordovician Section, and Yeli Group of Lower Ordovician Section, and Majiagou Group of Mid Ordovician Section, and Quaternary deposit. The stratum is mainly composed of calcium carbonate sedimentary rocks that range flatly or small aslant. The surface soil consists of loam and silt. The watershed of ground water is higher than the backwater line in the reservoir area. No large-scale water-conducting strata or seepage channels exists in the reservoir area.

33. The reservoir area is located at Taiyi mountain area, which has a rugged terrain with high mountains and narrow valleys. The river bottom elevation in the reservoir area is above 280.00m, and the maximum absolute elevation of the mountaintop reaches 954.00m. The banks of the valley are steep while the valley floor is relatively wide. However, the meander is not developed and belongs to the early U-shape valley. The area is high in south and low in north with a long and thin leave shape and average width about 5.5km. Five main tributaries are located in the upper stream of the dam and take on branch shape. The main stream is 15.6km long with mean slop of 2.54%. In the recent years, pretty good vegetations have been covering the most of the basin due to large scale forestation.

34. Climatic, Hydrological and Flood Features. Renhe Reservoir basin experiences a sub-humid monsoon climate of warm temperate zone with remarkable characteristics of continental climate, such as distinct seasons and abundant sunshine, dry even drought spring, hot and rainy summer, rainless and dry even drought autumn, and cold, dry and rainless, slow winter. The average annual temperature is 13oC, the highest temperature 42.1oC, and the lowest temperature -28.1oC. The average annual rainfall is 750 mm, in which the average annual rainfall in flood season (June to September) is 549 mm, covering 73% of average annual rainfall. The time for a flood process is commonly about 50-90 hours.

3. Shizuizi Reservoir

35. Geology and Geomorphology. Shizuizi Reservoir, with controlled basin area of 49.5 km2, is located in the north tributary of Shizi River.

36. Most areas in the Shizi River basin belong to bluestone mountainous area while some places are sandstone mountainous area. The basin, rounded by hills in east, north and west, ranges from high

9 10 landform in the north to low land in the south. The river system belongs to South-four-lake system of Huaihe River Basin, and its average width, mean gradient and length of trunk stream are 4.09 km, 0.464%, and 12.1 km respectively, with shape factor of 0.338.

37. Meteorological, Hydrological and Flood Features. Warm and monsoon climate covers the whole basin where the annual mean temperature range from 13oC to 14oC with maximum of 41oC and minimum of -17oC, non -frost period of 220 days, ice period of about 90 days. The prevailing winds in this basin are south-east winds in summer and north-west in winter while annual mean evaporation in this basin is 550 mm in land and 1,333 mm on water body.

38. Average annual rainfall reaches 850 mm with a main concentration from June to September (70% of the total annual rainfall). Therefore, a year with drought spring, rainy summer and drought autumn is very common.

39. The analysis on statistical rainstorm data of Shanting, Yanma and Xuzhuang hydro-stations indicates that (i) the annual maximum 24h rainfall is 361.7 mm occurred at Xuzhuang in 1999 while the minimum one is 51.5 mm occurred at Xuzhuang in 1982, with max./min. ratio of 7.0; (ii) the maximum annual 72 hours rainstorm is 362.2 mm occurred at Xuzhuang in 1999 while the minimum one is 65 mm occurred at Xuzhuang in 1982, with max./min. ratio of 5.6.

40. As mentioned above, rounded by hills from east, north and west direction, the concentrated flow in the basin is line-shape and the flood rises almost at the same time of rainstorm. Commonly, rainstorm starts in the upstream area first and moves gradually down to the mid-stream area; then a heavier flood will occur because floods in the upstream area flow down and join floods caused by rainstorms in the mid- downstream area.

4. Songshan Reservoir

41. Geology and Geomorphology. The Songshan Reservoir is located in the upstream of Shihe River, one tributary of Mihe River, the Mihe River system of the Yellow River. The distance from the reservoir to the Linqu County city is about 25 km. And the control basin area reaches 151 km2.

42. Originating from the Hulanding of in the north foot of Yimeng Mountain, the Shihe River mainly consists of three tributaries which come together near Sanchadian of Yiyuan, and flowing in to Linqu at the west side of Nuanshuihe Village, Wujing Town, Linqu; then, flows north east and into Mihe River at Wazi Village, Yangshan Town. The main stream is about 30 km long with average gradient of 1.23%.

43. Mountainous area covers about 70% of the total area while hilly area covers about 30%of the reservoir’s catchment whose average height ranges from 300m to 500m. The right bank area of the main stream is located in the area of igneous rocks, which belongs to impermeable layer and is abundant with orthophyres while the left bank area of the main stream is located in the area of limestone, which has features of karst area to different degree under influences of Wujing Default and joints and fractures in the stratum. There are mainly mid and upper Cambrian limestone, shale and Ordovician limestone in the basin. The watershed is covered with pretty good vegetations

44. Climatic, Hydrological and Flood Features. Warm and continental climate covers the whole basin where the seasons are quite distinct with windy and drought-prone spring, hot and rainy summer, hot and drought autumn and cold and rainless winter. Many hazard climates, such as hailstone, gale, dry- hot wind, and frost frozen, have heavy impacted on local agricultural production.

45. Average annual rainfall in the basin is 655.2mm. Rainfall is quite different at annual and seasonal. The rainfall from June to September accounts for 70.3% of that in one year. The statistics reveals that the maximum annual rainfall reached 1,089.4mm in 1990; minimum annual rainfall was only 345.3mm in 1981. The rainstorm in the basin results mainly from south-eastern warm and moist air stream, westerly circulation and typhoon with seasonal variation. It rains heavily and frequently in the flood season. The

10 11 reservoir is located in a mountain river whose runoff can be easily gathered. Rising stage of flood is commonly 622 hours and one flood generally lasts for 66 to 82 hours.

5. Longwantao Reservoir

46. Geology and Geomorphology. The reservoir area, situated in the upper of Jihe River, tributary of Sihe River, Longwantao Village, Sishui County, E117o24’ and N35o34’, has control area of 143 km2. This basin belongs to the Yuhe River system, Haihe River Basin.

47. The foundation rock in the reservoir area is mainly the intrusive rock of the later Archean and the metamorphic rock of the Lower Proterozoic. The materials of Quaternary period are mainly distributed along the mountain slopes, valleys or along the river bed and both banks.

48. The controlled river basin is almost in a square shape with an average width of 6.68 km and gradient of 0.00396 m/m.

49. Climatic, Hydrological and Flood Features. Longwantao Reservoir is one of the high rainfall areas of Jining. Average annual rainfall reaches 790 mm (1960-2003), varying greatly from 1,105 mm in 1964 to 386.6 mm in 1988 with max./min. ratio of 2.86. Moreover, rainfall is also highly seasonal and concentrates in flood season, 518 mm, 65.2% of average annual rainfall with frequent rainstorms in July and August. The statistical analysis reveals that the maximum 24 hours rainfall reaches 205.7 mm on 15 August, 1995 while the mean annual 24 hours rainfall is 89.9 mm. Floods, abrupt rising and steep dropping, mainly occur in flood season; commonly, a flood continues only 20~30 hours.

6. Anjing Reservoir

50. Geology and Geomorphology. Situated on the Jinxian River, a branch river of Junhe River under Yihe River system, Anjing Reservoir has a controlled area of 35.12 km2 . The upper area belongs to hill area.

51. On lower mountain regions of the middle-south of the Shandong Province, Anjing reservoir is generally higher at the north and lower at the south in elevation. The bank of the reservoir consists of flood plain on the mountain toe with the elevation between 155 to 185m. The elevation difference is 20 to 30m. The flood valleys are developed with U-shape river bed at the dam site. The bottom of the valley is relative flat with 20~30m in width and 3~5m in depth. The river valley inside the reservoir is 70~150m wide, with an average gradient of 2.18%. The deposit rocks mainly consist of coarse sand and gravel. The main river bed has a width of 100m at the elevation of 143.4m in average. The terrain on the left bank has the elevation of 148.5~150.5m, which is 5~7m higher than the river bed.

52. Climatic, Hydrological and Flood Features. Monsoon and semi-drought continental climate covers the whole catchment where the four seasons are quite clear, and season changes are pretty remarkable, dry and windy in spring, hot and rainy in summer, hot and drought in autumn and cold and snowless in winter. The statistics of Pingyi County and other 8 stations (Tangcun, Linjian, Baiyan, Yuezhuang, Yangzhuang, Gongjiazhuang, and Changli) reveals that average annual temperature is roughly 13oC. The average annual rainfall of 782mm; average annual evaporation on water surface of 1,100mm; average annual sunshine hours of 2,622.4 h; frost-free period of 212 d; average annual depth of ice soil of 0.39 m and the maximum wind velocity of 16 m/s.

53. The storms in this basin commonly last for only a very short time and the runoff in the river channel is same to the rainfall. The rainfalls mainly occur in the period from June to September, 70% of the annual rainfall, while storms occur in July and August.

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7. Yangzhuang Reservoir

54. Geology and Geomorphology. Situated on the Ziqiu River, a branch river of Suohe River under Yihe River system, Yangzhuang Reservoir has a controlled area of 36 km2. The river basin is 11 km long, 4.5m wide with an average slope gradient of 2.4%. 55. 73. The foundation rock in the reservoir area is mainly the intrusive rock of the later Archean and the metamorphic rock of the Lower Proterozoic. The materials of Quaternary period are distributed along the mountain slopes, valleys or along the river bed and both banks.

56. The reservoir area covers the south side of Monshan Mountain, which is higher on the north and lower on the south, with the surface elevation ranging from 147.5m to 442m. The relative altitude difference is about 300 m. The geomorphology of this area is controlled by its geological structures, which mainly appears as hills and valleys. The hill region has the elevation between 230m and 450m, and mainly spread from north to west. Rocks are general granite and diorite. The only river appears in the reservoir region is Ziqiu River originating from Mengyin County, 150 ~200m wide with a gradient of 1.41%. The river bed elevation at dam site is 147.5m. It is a typical mountain river with rapid water level increase in the flood season and little flow in the dry season. The river erosion can be found in the right bank. The terrace on the left bank is 200~350m wide with the elevation of 160~166m, about 12.5~18.5m higher than the river bed.

57. Climatic, Hydrological and Flood Features. Warm and monsoon climate covers the whole Ziqiu River Basin where the four seasons are quite clear, and seasonal changes are pretty remarkable. Rainfalls concentrate mainly on July to September while rainstorms concentrate on July to August. The rainfall in different years is also quite different. The average annual rainfall is 800 mm, with maximum of 1,063 mm in 1971 and minimum of 395 mm in 2002, max/min ratio of 2.7. The period for continuous wet years or dry years last a long time, for instance, it was wet from 1962 to 1965 with mean rainfall of 921 mm while it was dry from 1986 to 1989 with mean rainfall of only 537 mm. The discharge in the river course is similar to the change of rainfall. Small discharge is in the river course while floods usually occur in flood season. The average annual temperature is 13.4oC with the highest of 39.0oC and the lowest of - 18.3oC. And the average annual evaporation of water surface reaches 1,227 mm while that for land surface is 490 mm. The average annual maximum 24h rainfall is 107 mm with maximum of 213 mm in 1991 and minimum of 38 mm in 2002, max/min ratio of 5.6.

58. Ziqiu River, a river with only water source of rainfall in valleys, is one of the typical flash flood rivers, in which discharges vary with changes of rainfall. Floods concentrate in flood season but usually no flow in river channel in non-flood season. This basin has a pretty weak capacity to regulate flood due to its very limited area. The gradient of the main river channel is 2.4%. The statistics reveals the flood features in the basin, such as short time for flowing convergence, abrupt rising and steep dropping. Common floods usually last for a very limited time while large floods last for about 24 hours.

8. Huacun Reservoir

59. Geology and Geomorphology. The reservoir is located in middle reaches of Huanggou River, which belongs to the south four lakes of the Huaihe River Basin. The reservoir has a control area of 143 km2, with its location at eastern longitudinal 117o27’, and northern latitude 35o00’.

60. The foundation rock in the reservoir area is mainly the intrusive rock of the later Archean and the metamorphic rock of the Lower Proterozoic. The materials of Quaternary period are distributed along the mountain slopes, valleys or along the river bed and both banks, mainly in the City region. About 70% of the Quaternary materials are distributed on mountainous area and 30% on hilly area. The river basin is 6.7 km in width. The gradient of the river on the upstream of the dam site is 2.96 m/km. Rocks can be found on the mountain top. Soil mainly distributes on the valley and mountain edges with a thickness of 0.5~1.0m. Karst caves, faults and cracks area existing in the reservoir area with heavy leakages. About 50% of the area is covered with crop plants of potatoes, peanuts and fruit trees, 15% is covered with trees and grasses, and the rest is naked rock.

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61. Climatic, Hydrological and Flood Features. Warm and monsoon climate covers the whole Sihe River Basin where the four seasons are quite clear, windy and drought in spring, hot and rainy in summer, drought in autumn, cold and dry in winter. Drought occurs frequently in spring and late autumn while water logging occurs frequently in summer.

62. The statistics on the climate data from the meteorological station of Sishui County reveal that this basin is one of the high rainfall places in Jining Municipality with average annual rainfall of 742.6 mm, maximum rainfall of 1,237 mm in 1964, and minimum rainfall of 357 mm in 1988, the max/min ratio of 3.47. Moreover, the rainfall is also quite seasonal. About 70% of annual rainfall occurs from June to September (mean annual value reaches 521 mm). The annual maximum 24 hours rainfall is 206 mm occurred on 24 July, 1999 while the minimum one is 51 mm occurred at Xuzhuang in 1982, with max./min. ratio of 7.0. The annual mean temperature is 14.6oC with maximum of 4 0.3oC and minimum of -22.1oC. The maximum wind velocity reaches 24m/s.

63. Dahuanggou River, a river with water source of rainfall in valleys, is one of the main flash flood rivers in the upstream of Sihe River. In this river, the discharges vary with the change of rainfall, and have more inter-annual and annual changes. Floods concentrate in flood season. The statistics reveals that a common flood usually lasts for a short time, commonly, 20~30 hours; and the peak discharge lasts usually only for 6 hours.

9. Muyu Reservoir

64. Geology and Geomorphology. The reservoir area, situated in the mid and downstream area of Xianhe River, a tributary of Wulong River, has control area of 455 km2.

65. The exposed strata in the Xianhe River mainly consist of intruded rocks of late Archean Group, metamorphic rock of early Algonkian Group and quaternary stratum. The former two type of rocks covers mainly in low hill areas while the loose quaternary stratum covers in the most areas of hill front and both sides of rivers, or the intermountain low land around the foot of mountain in waistband shape.

66. This basin, in a long - narrow shape of denudation low hills of Ludong structure, ranges from its high north part, about 500 m high with highest mountain peak-Leishan of 500 m, to its low south part, about 300m, including low hills and river valleys. The river system above dam site consists of one main stream, extending from the terminal of backwater area to the northeast of upstream, with length of 42 km average gradient of 0.132%, and many tributaries. The downstream river of the reservoir passes through the east urban district of Laiyang City.

67. Climatic, Hydrological and Flood Features. Warm, wet, monsoon and continental climate, and maritime climate due to close to sea, covers the whole catchment. Storm floods occur mainly in mid- summer and early autumn with obvious seasonal feature. Annual rainfall varies greatly from 1,255 mm in 1964 to 407 mm in 1999 with max./min. ratio of 3.08. Moreover, the rainfall is also highly seasonal and concentrated in flood season, 74.6% of mean annual rainfall. The analysis on statistical data indicates that the annual maximum 24 hours rainfall is 95 mm.

68. As a creek river, the flow discharges in the Xianhe River vary with season. Floods, abrupt rising and steep dropping, mainly occur in flood season; commonly, a flood continues only 15~20h.

B. Ecological Environment

69. All 9 subprojects are located at eastern part of Shandong province and in continental climate of warm temperate zone monsoon area. Due to the same climate condition and similar landform, all of the 9 subprojects belong to same habitat. On the other hand, the long-term human activities have resulted in a low diversity of biological resources. The ecological feature surrounding the 9 subprojects is similar. In the project areas, no national or provincial level natural reserve zones exist.

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70. Flora. The vegetation of this project is temperate zone broad-leaf forest belt. Because of long- term human factors, the primitive natural vegetation has suffered great destruction. The extant natural vegetation is secondary vegetation, that is, temperate zone evergreen forest and temperate zone deciduous bush and underbrush and so on. The natural vegetation of reservoir area mainly has honeysuckle and grassy weed; the crops mainly have wheat, corn, sweet potato, peanut and so on; the forest cover is mainly artificial; cultivated warm temperate zone deciduous broad-leaf high forest and deciduous broad-leaf with needle forest, the main trees are poplar tree, cypress, apple tree, peach tree and so on. In the reservoir area and bottomland, there are reed, cattail stem, water chestnut and so on; natural and artificial underbrush have the dog fur rugs, red grass, Chinese sheep bushes, wormwood grass and so on. The grasses are mainly couch grasses which grow naturally at roadside and dike slope.

71. Crops in basin are mainly wheat, corn, millet, sorghum, soybean, peanut, and flue-cured tobacco. There is little vegetation in the reservoir area that the majority of bedrocks are bared, the peeling off of whose regolith leads to the formation of sand-like medium coarse sand that is easy to be washed away by the rain. Accordingly, it is critical to make effort for water and soil conservation and forestation.

72. Fauna. The remnant population is lack of forest habitant. Animal communities observed in the project area are dominated by species commonly associated with shrub-land and grassland communities. Mammalian species are mostly smaller rodents. The majority of the observed birds are migration species.

73. There are no known migratory, endangered fish species. No national rear and endangered animals or protected species, including aquatic species, are documented at the subproject areas.

C. Environmental Quality

74. The environmental quality in the 9 subprojects sites were maintained to excellent and good grades. All the ambient air, water and noise parameters and noise level met the national ambient environmental standards. Specially, air quality met the requirements of class II of the national air quality standards.

75. For more than 30 monitoring locations, the water quality parameters met the applicable national surface water quality standards for Class III as the back up urban potable water sources. At there closest area of 1000 m to the edge of the reservoirs, there are no found polluted water discharge point and air pollution emission point by the industrial activities.

76. The water quality protection objectives in the operation time is Environmental Quality Standard For Surface Water (GB3838-2002) category III.

77. The watercourse nearby the construction area should be maintained or be optimized better than the existing water quality. The construction area water quality is controlled according to Environmental Quality Standard for Surface Water (GB3838-2002) category V. The wastewater discharge should reach the standards to avoid pollution of water bodies.

78. The drinking water quality of construction workers should be in compliance with Sanitary Standard for Drinking Water-85 (GB5749-85); The drinking water quality of living area and resettlement area should be in compliance with Water Quality Standard for Drinking Water Sources (CJ3020-93).

D. Social Environment

79. Shandong province has a population of 94.17 million (2008) of which 62.2% and 37.8% are rural and urban respectively. In 2008, the gross domestic product (GDP) in Shandong was Chinese yuan (CNY) 3,107.2 billion, averaging CNY 33,083 per capita, which is about 146% of the national average (CNY 22,698). GDP composition ratios for primary, secondary and tertiary sections are 9.7%, 57.0%, and 33.4% respectively. About 6.91 million hectares is farmland. On average, each rural person has about 0.112 ha (1.67 mu) of farmland. The per capita income in rural areas was CNY 5,641 in 2008, which is

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118.4% of national average (CNY 4,761). For urban residents, the average income per capita was CNY 16,305, which was about 3.3% higher than that of PRC (CNY 15,781). Table 3 provides more detailed economic information for Shandong province. Shandong province, like all other provinces in PRC, has experienced a rapid economic growth in the past two decades. The annual GDP growth rate has reached 12.1% for Shandong province during the period of 2007 - 2008, which is higher than the national average or 9%.

80. According to official statistics in these 7 project counties,7 in 2007 there were 5.79 million people in the 7 project counties with 11,267 km2. The average population density was 514 persons/km2. About 2.62 million rural labours in the project counties, accounting for 54.2% of the total population in the project counties. Table 4 provides a basic demographic profile for the project counties in Shandong province.

Table 4 - Economic Performance in Project Counties (2007) (Billion CNY)

Urban Per Rural Per GDP Per Area Population % of % of % of Capita Capita billion Capita County Km2 ,000 1st second third Income Income CNY GDP CNY CNY CNY Laiyang 1732 872 23.6 7,048 11.4% 59.7% 28.9% 12,361 6,512 Linqu 1834 860 11.4 13,202 17.8% 52.2% 29.9% 12,801 5,355 Pingyi 1825 996 13.7 13,729 14.1% 49.4% 36.5% 10,050 4,670 Qingzhou 1569 903 26.3 29,166 9.7% 59.2% 31.1% 12,818 7,023 Sishui 1119 606 7.1 11,715 24.7% 46.0% 29.4% 9,348 4,748 Shanting 1019 491 5.7 11,514 16.3% 49.0% 34.7% 6,631 4,136 Zhucheng 2169 1063 30.3 28,470 11.0% 64.0% 25.0% 12,408 6,787 Total 11267 5790 118.0 20,373 12.9% 57.4% 29.7% 10,803 5,551 Shandong 2596.6 27,721 9.7% 57.1% 33.2% 14,625 4,985 CNY = Chinese yuan, GDP = gross domestic product Source: Shandong Provincial Statistical Yearbooks 2008; and relevant county or city statistical yearbooks 2008.

81. In the project counties, in 2007, there were 0.74 million students with 0.38 million of primary school students and 0.27 million of middle school students. In terms of basic health facilities, there are 15,803 beds and 19,057 medical staff in project counties, averaging 3.29 medical staff and 2.73 beds per 1,000 people, which is slightly lower than Shandong provincial average (3.6 medical staff and 2.80 beds per 1,000 people).

82. In the 7 counties, there are 4.84 million of rural populations and 2.62 million of rural labour force in 2007, which accounted for 54.2% of total rural population. Among them, 1.42 million of labours are working in agricultural sector, accounting for 54.3% of total labour force, which was higher than the provincial average in Shandong province (50.4%). The remaining 1.2 million labours or 45.7% are working in secondary and tertiary sectors, which was lower than provincial averages with 49.6%.

7 Including three county-level cities and one district.

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83. Among the 7 project counties, there are 4 poverty counties, (57%). Following the poverty line adopted for rural and urban residents, there are 430,275 poor people in the project counties or districts, with a poverty incidence ratio of 7.4%, of which 93% of the poor are from rural areas, and 7% of them are living in urban areas. The resulted rural poverty incidence rate is 8.2%, which is 4.7 points higher than the Shandong provincial average; and the urban poverty ratio is 3.3%, which is 1.4 points higher than the provincial average. The average rural per capita income in 2007 was CNY 5,662, which was 113.5% of the Shandong provincial average (CNY 4,985) in 2007.

VI. ANTICIPATED ENVIRONMENTAL IMPACTS AND MITIGATION MEASURES

A. Incremental Environmental and Social Benefits

84. The proposed project will have a direct positive impact downstream on poverty reduction and the environment since it will (i) mitigate potential failure risks of the reservoirs and protect the lives, property, and livelihoods of the poor, who usually are the majority of the population living downstream; (ii) provide more water for agriculture and household use to the poor living downstream of the reservoirs; and (iii) improve quantity of reservoir releases, especially in dry seasons, which can provide water to sustain wetlands and the health of flora and fauna, maintain fisheries, preserve water quality, and improve groundwater resources. The project will also have a positive impact upstream on poverty reduction and the environment through watershed management as part of the integrated water resources management.8

85. The project will develop sustainable reservoir rehabilitation and management models which may be replicated throughout the PRC. The rehabilitation model, which will be developed under the project being financed from ADB loan, will include (i) reservoir rehabilitation technical guidelines, (ii) a methodology for risk estimation of dam failure due to hydrological overloading, (iii) a risk-based methodology for reservoir rehabilitation planning, (iv) a provincial reservoir portfolio database, (v) watershed management measures, and (vi) a reservoir safety management model. The effective reservoir utilization model for integrated water resources management, which will be developed under a piggy-back technical assistance being financed from ADB grant and Water Financing Partnership Facility grant, will include model plans for (i) integrated water utilization, (ii) integrated flood management, and (iii) further increase of environmental benefits downstream.

86. Currently, the 9 reservoirs do not store water up to the design level due to water leakage, instability of water-retaining dams, and lack of adequate spillway capacity for emergency discharge of rapidly rising floodwaters. As a result, these reservoirs are inadequate to control floods, supply irrigation water, or provide year-round household water supply for users. The project will decrease threat of reservoir failures and mitigate flood damage for 1.04 million of population in 1,303 km2 of the downstream areas of the nine reservoirs. The project will also enhance the irrigation conditions in the project irrigation areas benefiting 587,523 persons in 584 villages. For these villages, they collectively own 64,280 ha of farmland, with 42% being irrigated by nine reservoirs at present. After projects, with increasing irrigation storage, the irrigation areas could be increased to 38,273 ha, increasing by 43%. Such improvement will benefit most people in 584 villages, including 33,209 rural poor in these villages. The increase water storage will also improve water supply condition for Laiyang City, benefiting 180,000 persons in the serviced areas including over 1% of urban and rural poor in the project areas.

87. Out of the 9 reservoirs, only Muyu Reservoir is supplying drinking water. The other 8 reservoirs have no plans for drinking water supply. With regard to Muyu Reservoirr, the designed drinking water supply volume and the population to receive water will not change after the rehabilitation, but the supply will be more stable and the actual supply volume will be closer to the designed supply volume since the reservoir will be able to store water up to the designed level. The maximum supply volume/day to each

8 The project will identify watershed management measures for the subproject reservoirs to improve reservoir water quality and reduce sedimentation.

16 17 household will not change, but reduction and suspension of water supply will be less frequently after the rehabilitation. The maximum waste water volume/day from each household will also not change and the waste water will continue to be treated by the existing facilities.

88. In addition, during the construction, the project will create employment opportunities for many local un-skill labours and reduce their poverty conditions. Based on amount of construction quantity, as many as 13,500 persons could be employed for at least 150 days during next two years.

89. By removing flood danger permanently from the project protected areas, it will create a safe environment for both urban and rural residents. With better protection, they will be able to sleep well during rainy season and not worry about their family members and their limited physical assets. More importantly, the better protection would allow farmers to invest high yield vegetable green house and not afraid of being washed away. For many state owned enterprises, better protection means more opportunities to attract outside investment so that more jobs could be created and more people could be employed.

90. The project is expected to provide significant environmental benefits. These include: strengthen integrated water resources management and allocation, provide and improve the regulation of environmental flows, adaptation to climate change (increase resilience to changing occurrences of droughts and floods), and reduce the risks of dam failure. The adverse environmental impacts of the proposed project are expected to be minimal and at short time of construction phase. Adequate mitigation measures can be applied to reduce the impacts to acceptable level.

91. Although there is no clear agreement on impacts of climate change, PRC scientific reports show that rainfall in Shandong province may decline with an average of 2.5% per decade. The project will contribute to the adaptation to climate change through increased resilience to changing occurrences of droughts and floods by increasing flood control and water storage capacity of the reservoirs.

92. For each subproject reservoir, changes in downstream flow regime after the project was assessed. It was confirmed that the rehabilitated reservoirs will mitigate flood downstream by storing flood water and increase flow in dry seasons by releasing the stored water. No downstream issues were identified.

B. Potential Adverse Impact and Mitigation Measures during Construction Phase

1. Construction Activities and Associated Adverse Impacts

93. The will rehabilitate the 9 reservoirs including dam strengthening, spillway reinforcement, and other civil works such as rehabilitation and/or construction of reservoir administration offices and roads. The important construction activities are concerned land clearance and land leveling, demolish of existing structures and facilities, and other standard civil engineering activities such as construction material loading, hauling, and unloading, concrete- mixing and filling, and new facilities installation. Construction activities and the associated adverse impacts were given in Table 5. Table 5 - Construction Activities and Potential Adverse Environmental Impacts

Major Construction Activities Potential Adverse Environmental Impacts Qiangkuang  East dam foundation strengthening  Demolish spoil, Reservoir  East dam core reinforcement noise, wastewater  East dam upstream dam shell reinforcement  Dust from earth  East dam crest and slopes reinforcement excavation  East dam drainage construction  Exhaust from vehicles and equipment  Low and/or restricted downstream flow

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Major Construction Activities Potential Adverse Environmental Impacts  West dam foundation reinforcement  Demolish spoil,  West dam body reinforcement noise, wastewater  West dam crest and slopes rehabilitation  Dust from earth  West dam drainage rehabilitation excavation  West dam spillway reconstruction  Exhaust from vehicles and equipment  Low and/or restricted downstream flow  Outlets reinforcement  Construction solid  Connecting channel reconstruction waste, noise,  Continuous auxiliary works for water saving improvement wastewater  Others: the flood control road reconstruction, electric facilities  Dust from earth installation excavation  Spillway reinforcement  Exhaust from vehicles and equipment  Sediment by dredging Renhe  Gravity dam reinforcement  Construction solid Reservoir  East Earth dam reinforcement waste  Concrete cut-off works and others  Demolish spoil,  Spillway and outlet strengthening, newly built apron noise, wastewater  Others, electric facilities installation or replaced  Dust from earth excavation  Exhaust from vehicles and equipment  Low and/or restricted downstream flow Shizuizi  Homogeneous earth dam Reinforcement  Construction solid Reservoir  Reconstruction of upstream slop waste  Maintenance of the downstream slop  Demolish spoil,  Reconstruction of drainage ditches and drainage mound at dam noise, wastewater toe  Dust from earth  Spillway gate reinforcement works excavation  Administration office building and others  Exhaust from  Installation of light facilities and electric facilities, vehicles and  Replacement of metal facilities and structures equipment  Sediment by dredging  Low and/or restricted downstream flow Songshan  Dam reinforcement  Construction solid Reservoir  Terrace section reinforcement:: concrete cutoff wall will be waste constructed, the maximum depth of the wall is 47.2m, with 5m  Demolish spoil, imbedded into the rock foundation noise, wastewater  Construction drainage ditch 440m  Dust from earth  A new wave wall on the dam crest will be constructed excavation  New spillway will be constructed with 5 gates. The total width of  Exhaust from the spillway chamber is 55.2m vehicles and  The original concrete outlet pipe will be lined with a fibreglass- equipment reinforced plastics pipe  Sediment by  Others. Installation of electric facilities dredging  Construction of Administration office building  Low and/or restricted downstream flow

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Major Construction Activities Potential Adverse Environmental Impacts Longwantao  Dam reinforcement; curtain grouting, construction cutoff wall,  Construction solid Reservoir reconstruction of the upstream slope waste  Repair the wave wall and road on the dam crest, trim the  Demolish spoil, downstream slope and plant grass noise, wastewater  Reconstruction of the drainage ditches and slope drainage body  Dust from earth  Spillway reinforcement; repair and strengthen the inlet channel, excavation control section, discharge section, dissipation section and the  Exhaust from outlet channel at downstream vehicles and  Reconstruction of the hoist chamber, the operation house and equipment trajectory structure  Sediment by  Reconstruction of drainage way; consist of inlet, shaft and gate dredging chamber, tunnel  Low and/or restricted  Office construction, road improvement, and irrigation river downstream flow channel improvement  Outlet and metal structure and equipment Anjing  Main dam reinforcement; construction 6 m width flood road on the  Construction solid reservoir dam crest, reconstruction of the slope with dry masonry rock waste blocks, the downstream slope will be maintained by covering a  Demolish spoil, layer of soil noise, wastewater  Reinforcement of dam foundation; high pressure jet grouting  Dust from earth method will be used excavation  Reconstruction of the auxiliary homogeneous dam.  Exhaust from  The displacement and seepage monitoring facilities will be vehicles and reconstructed equipment  reconstruction of spillway, demolish the existing structure  Sediment by  Reconstruction of outlet tunnel, including shaft, gate chamber, dredging operation bridge  Low and/or restricted  Installation of electric facilities downstream flow  Transportation for spillway  Administration office equipment Yangzhuang  Reinforcement of dam; upstream dam slope reinforcement,  Construction solid Reservoir downstream slope reinforcement, waste  Reconstruction of dam crest road and wave wall dam foundation  Demolish spoil, treatment and reinforcement to against seismic installation of the noise, wastewater suspended cement wall for seepage control and dam monitoring  Dust from earth facilities excavation  The spillway will be newly constructed with vertical guide wall and  Exhaust from reinforced concrete blanket, weir and traffic bridge vehicles and  Reconstruction of discharge channel equipment  Reinforcement of outlet tunnel; demolish the existing outlet tunnel  Sediment by and reconstruct it, reconstruction of the intake channel dredging  Reconstruction of the control room, the shaft, the sluice and  Low and/or restricted hoister downstream flow  Reconstruction of the gallery, outlet retaining wall and the energy dissipation pond  Installation of electric facilities  Rock works for spillway (excluding the bridge)  Rock works for dam (excluding the dam anti-leakage work)  Administration office equipment Huacun  Dam reinforcement; the cutoff wall made of cement-soil will be  Construction solid reservoir installed, waste  Dam foundation reinforcement, curtain grouting is adopted  Demolish spoil,  Reinforcement of homogeneous auxiliary dam with noise, wastewater  Reinforcement of crest road  Dust from earth  The spillway will be consolidated excavation  The outlet tunnel will be reconstructed  Exhaust from vehicles and

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Major Construction Activities Potential Adverse Environmental Impacts  Construction of management office equipment  Installation of electric facilities  Low and/or restricted  Administration office building and road improvement downstream flow

Muyu  Dam reinforcement including; seepage treatment by grouting and  Construction solid Reservoir cutoff wall on the foundation and dam body waste  Reconstruction of upstream slope protection layers  Demolish spoil,  Reconstruction of dam crest noise, wastewater  Reconstruction of spillway, blocking of original main spillway  Dust from earth  Reinforcement of east and west outlets excavation  Protection wall for east outlet and downstream, and drainage  Exhaust from system vehicles and  Flood management roads, and protection wall on both side of equipment river channel  Sediment by  Installation of monitoring facilities and electric facilities dredging  Low and/or restricted downstream flow

C. General Mitigation Measures

94. In the preparation of the EIA reports and feasibility study reports and during the ensuing preliminary design phase, the following mitigation measures have been and will be undertaken:

i) All the project sites are carefully selected to avoid or minimize potential adverse impacts on the environment and surrounding communities. ii) The facilities are located and designed to minimize resettlement impacts. iii) Adequate technical design and scheduling of construction activities for the components will provide for safety, sanitation, and environmental protection in compliance with government regulations and international practices. iv) All components have undergone the EIA process under the PRC laws and regulations. The EIA reports were prepared by qualified EIA institutes, reviewed by expert panels, and approved by the Local Environmental Protection authority or the respective municipal environmental protection bureaus. v) Appropriate environmental mitigation and monitoring measures are included in the environmental management plan (EMP). The proposed environmental mitigation measures will form part of the design documents for the components, and be included in the contracts for procurement of goods and services. All contractors and subcontractors will be required to comply with the EMP. vi) The environmental monitoring program has also incorporated into the overall project design to ensure that environmental impacts are closely monitored and the construction and operating activities are closely supervised against the approved EMP.

D. Biodiversity Conservation and Sustainable Natural Resource Management

1. Critical Habitats and Legally Protected Areas

95. Neither important historical and cultural sites nor rare and endangered species will be affected by the project. Construction areas will not be located in forests and grassland of ecological significance, natural reserves, or scenic areas. All the project sites have been carefully selected to avoid or minimize potential adverse impacts on the environment and surrounding communities.

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2. Potential Impact to Flora

96. Vegetation within the construction area will be cut and cleared for the nine construction sites. The mitigation measures proposed will be to immediately re-vegetate these areas and to replant trees, without waiting for the construction to be completed. In addition, the loss of trees owned by individuals and collectives and compensation for the loss was discussed with the affected people and included in the resettlement plans. In the EIA reports, impact on the flora and fauna was expressed as a change in biomass productivity, in the landscape quality index, and in habitat. But the change will be site-scale and minor and temporary. During construction, topsoil is to be stored separately whenever possible. Re- vegetation will begin as soon as work is completed. Using this method would make vegetation recovery become much faster. No significant adverse impacts will be imposed on the local ecological environment. There are no records of rare or endangered species living within the construction areas.

3. Inundated Reservoir Bed Clearance

97. Following rehabilitation works, the water level of reservoir running will reach a new higher level than present running water level. Water level rising will inundate some area directly around the reservoir and become reservoir bed. The newly permanent inundated areas are total of 1.22 square kilometres, include; 0.5 square kilometre of Renhe reservoir; 0.72 square kilometres of Songshan reservoir; and 0.05 square kilometres of Longwantao reservoir. At present, there are some structures and facilities in the newly permanent inundated land. The newly reservoir bed will be thoroughly cleared of all structures below the new normal storage level, including veterinary stations toilets, rubbish cans prior to inundation, to minimize the potential increase in waterborne infectious diseases and to eliminate the pollution source.

4. Temporary Impacts on Irrigation and Drinking Water Supply During Reservoir Strengthening Works

98. The irrigation and drinking water supply benefits would be interrupted during implementation of reservoir rehabilitation subprojects. According to project feasibility studies and preliminary design reports, most reservoirs subprojects would lower the reservoir water level considerably in order to ensure smooth construction. As a result, irrigations will be reduced or stopped from fall in 2009 to spring in 2010 for 3 reservoirs (Qiangkuang, Songshan, and Muyu Reservoirs), from fall in 2009 to spring in 2011 for 4 reservoirs (Renhe, Longwantao, Huacun, and Shizuizi Reservoirs), and from spring 2010 to spring in 2011 for 2 reservoirs (Yangzhuang and Anjing Reservoirs). Because of such schedule, the irrigation in fall 2009, spring in 2010, fall in 2010, and spring in 2011 will be affected. Since rainfall situation in summer is normal, and irrigation needs in fall in 2009 and 2010 will be limited. The main temporary impacts would be lack of irrigation in spring in 2010 and 2011. Drinking water supply from Muyu Reservoir (the only reservoir supplying drinking water, see para. 87) would be interrupted from fall in 2009 to spring in 2010 during implementation of the reservoir rehabilitation. Muyu Reservoir could store water again in May 2010.

99. Mitigation measures have been adopted to mitigate potential impacts from the temporary interruption of irrigation and drinking water supply in the downstream areas of the nine reservoirs, during reservoirs rehabilitation works. Consultations have taken place in the project areas with affected people for such interrupted/limited irrigation during the construction period. It was discussed that all affected villages have alternate water resources (existing wells, rivers, ponds,9 and other reservoirs), which have sufficient and adequate water for substitute for remaining irrigation needs during the construction period. The affected farmers in the villages fully agreed to use the above alternative water resources to cover the specified irrigation gaps during the reservoirs and dams rehabilitation. Under the project preparatory technical assistance, the above-mentioned use of existing wells, rivers, ponds (see footnote 8), and other reservoirs was evaluated. The total loss of irrigation water supply from the reservoirs is estimated to be 210 million m3, out of which 30.8%, 19.7%, 49.1%, and 0.4% will be supplemented from existing wells, rivers, ponds (see footnote 8), and other reservoirs, respectively. Since (i) water released from the

9 Water released from the reservoirs before the rehabilitation works will be stored in ponds downstream and be used for irrigation during the reservoir rehabilitation period when water is not released fro the reservoirs.

21 22 reservoirs before the rehabilitation will be stored in ponds downstream and used for irrigation during the rehabilitation as much as possible, and (ii) use of alternative water resources (existing wells, rivers, and other reservoirs) is limited in October in 2009, March, April, and October in 2010, and March and April in 2011, the temporary use of these alternate water resources will not have impacts on the environment. For drinking water supply interruption, Laiyang city government, the owner of Muyu Reservoir, agreed to provide financial subsidy to the Muyu Reservoir administration office at CNY210,000/month. Laiyang city government also agreed to purchase 20 million m3 of water from upstream reservoir to supplement water by Laiyang Water Company. With these mitigation measures, the impact of Muyu Reservoir rehabilitation on drinking water supply will be fully mitigated.

5. Noise Nuisance

100. In the construction period the noise mainly comes from construction machines such as excavators, scrapers, tractors, dump truck, the belt of gravel yard or car transport, screening, washing and pilings of construction material. The noise impact will happen at all of the nine reservoir rehabilitation construction sites. The noise of construction machine is generally between 80 ~ 110 dB, while the vehicle noise intensity is generally about 90 dB. As some of the construction areas are adjacent to the villages, the noise will have some adverse effects on nearby residents.

101. In the construction area, the noise should be controlled according to the Standard of Measurement Method for Noise From Construction Site (GB12523－90). In the project affected areas, the noise should be controlled according to Standard of Environmental Noise of Urban Area (GB3096-93); in the urban area and rural area impacted by the construction, we implement the standard category two and standard category 4 respectively.

102. The mitigation measures are: (i) noise source control by selecting low-noise technology and equipment and using vibration dampers for equipment (components) with large vibration; (ii) strengthening of equipment repair and maintenance so that construction machinery are maintained in good working condition; and (iii) reasonable arrangements for construction (for the construction area nearby the resident zone, the construction with high noise should avoid during the 22:00 to 6:00 at night and, when the vehicles pass noise-sensitive areas, the speed should be controlled to no more than 35km/h and whistle should not be permitted).

E. Pollution Prevention and Abatement

1. Atmospheric Emissions

a. Dust Generation

103. Potential sources of dust generation construction activities are similar at all subproject sites and include (i) dust generated from earth excavation, loading, hauling, and unloading; (ii) dust generated by the movement of vehicles and heavy machinery on unpaved access and haul roads; and (iii) dust from aggregate preparation, concrete-mixing, and haulage activities. These actions will be occurred at the all of the nine subproject construction sites. To limit dust generation during construction, water trucks will be used to wet the construction roads, according to a daily schedule and taking into consideration weather conditions. When construction takes places during dry and windy days, water will be sprayed on earth piles and exposed surfaces to suppress dust. Aggregate preparation and storage areas and concrete- mixing plants will be located more than 300 m from the nearest residential area, downwind by the prevailing wind, while asphalt plants will be located more than 500 m downwind. Dust suppression equipment will be installed in concrete-batching plants.

b. Greenhouse Gas Emissions

104. Potential sources of greenhouse gas emissions from subproject works include machinery and vehicle exhaust, and inundation of existing vegetation resulting in the decay and release of carbon dioxide. Proper maintenance of vehicles and diesel equipment, and avoidance of unnecessary running of

22 23 vehicle and equipment engines will reduce emissions. No vehicle that emits black smoke will be allowed to operate on-site. According to past similar water resource construction works, greenhouse gas emissions from vehicles and machinery are likely to be very low. Inundation as a result of reservoir strengthening works is likely to be minimal, and as a result project induced decay of existing vegetation is likely to be negligible resulting in negligible volumes of carbon dioxide release.

c. Odours

105. The process of dredging, sediment dewatering, and transportation may resulting in an odour nuisance, which has the potential to impact local / neighbouring residents and cause odour nuisance along any sludge transportation routes. The dredging activities will be located at the open field surface, and there is a safe distance between the dredge spots and adjacent human communities. Dewatered sludge will be transported and used for landscaping or landfill with soil covered at a safe distance to human settlements. The properties of the sludge are similar or same to the surrounding soils, which have shown that: i) the contents of the sediments are composed of little more organic matters than the surrounding soils; ii) they do not contain significant levels of toxic substances; and iii) other parameters can meet the corresponding national standard. Therefore, the use of dried sediment is safe for landscaping purposes.

2. Sediment Dredging

106. The sediment dredging activities are expected at the spillway rehabilitation engineering for the seven reservoirs, except Huacun reservoir and Renhe, for to last for more than 10 weeks. Total of about 5,000 to 10,000 m3 sediment will be dredged at the seven reservoirs spillway way rehabilitation sites. At Shizuizi reservoir, there is sediment dredging activity. The dredging activity may become the source of noise emissions. The noise emitted by the dredging machinery and perceived by the nearest sensitive receptors depends on the gradual attenuation of the original noise level by aspects like distance from the source. Considering the location of nearest village is more than 1 km from the construction site, the impact of noise from the dredging activities is considered to be negligible.

107. The dredging activities will cause the disturbance of sediments. This is expected to lead to short- term increase in concentrations of total suspended substances (SS) in the reservoir water body especially immediately around the dredging spots. Increased SS may affect the fish population, if any, in the water body away from the impacted area; but the impact will dissipate soon after the construction ends. The contractor will be required to have sound environmental management programs, including well- maintained dredging machinery, solid waste collection and disposal and wastewater handling. Water quality in the reservoir will be monitored during construction for SS, chemical oxygen demand (COD), and oils and grease to confirm the result of the impact assessment and effectiveness of mitigation measures adopted.

3. Construction Waste Water

108. The construction wastewater is mainly from foundation pit drainage; sand and gravel material washing wastewater; concrete mixing and conservation waste water. From these activities, the main pollutants are suspended solids washing and concrete, construction machinery and oily wastewater. Pit drainage, wash water aggregates, concrete and concrete mixing system, conservation of water washing., The activities on machinery and vehicle maintenance, washing, waste water, the main pollutants is oil in the higher levels.

109. According to previous data analysis, the foundation pit drainage is mainly the construction draining water which has relatively good quality and no influence to the downstream water. It will be discharged into the nearby landscaping water body or irrigation water body. It will be not allowed to discharge the waste water into the reservoir water body.

110. Washing and maintenance wastewater mainly include sand and gravel material washing wastewater, concrete mixing and concrete conservation wastewater. This action will be occurred at the all

23 24 of the nine subproject construction sites. According to previous construction experience, the general concrete production wastewater is alkaline with high percentage of suspended solids which is always out of limits. The main components of the suspended matter are inorganic substances such as soil particles and cement particles which are non-toxic and non-harmful. Because of the low intensity of wastewater discharge, the wastewater discharged into the nearby ditches has little impact on the water quality. The impact will be further mitigated after the wastewater being sediment accordance with the discharge standards. Concrete processing wastewater treatment: The concrete processing plants are situated at various locations throughout the construction sites. Each has a low production capacity. At each plant, there is a simple water collecting pool to contain the wastewater. The wastewater is settled before discharged into nearby landscape water body which belongs to class V water quality limitation. The treated water can meet such standard requirement. It will be not allowed to discharge the waste water into the reservoir water body.

111. In the construction phase, some of the machines take diesel as its power fuel, the vehicle washing and maintenance waste water has suspended solids and oil. The oily waste water which is discharged directly into water bodies will form an oil film on the water surface, resulting the hard recovery of dissolved oxygen in the water body and therefore affecting the water quality; the random dispose of oily waste water will also reduces soil fertility and change the soil structure. Thus, the oily waste water can not be discharged until reaching the treatment standard. The simple oil-water separate facility will be used to collect the oily waste water and treating it before discharge until the discharge meet the related standard. Setup the catch drain in the construction machinery repair and maintenance yard to collect the washing and maintenance oil-bearing wastewater. This project has a small amount of oily wastewater, thus the simple oil filtering pool in the construction zone will be used to separate the oil from water, before the wastewater discharged to nearby landscape water body which belongs to class V water quality limitation. The treated water can meet such standard requirement. It will be not allowed to discharge the waste water into the reservoir water body.

4. Solid spoil from construction activities and mitigation measures

112. Spoil materials will be produced at the facilities and equipment rehabilitation of the all of the nine subproject construction sites. Spoil materials will be a mixture of soil and stone and other construction solid waste. More than nine spoil disposal sites have been located throughout the project construction area for the disposal of excavated spoil. Principles for the siting and layout of spoil disposal areas were:

(i) Siting to minimize transportation and the need for temporary storage; (ii) Siting to avoid potential flood areas or flood way; (iii) Sites to be small, and have no encroachment on cultivated land or forestland; (iv) Sites to be concave land, gullies or gentle slopes.

113. The final height and shape of each disposal area will be determined by survey during the detailed design phase and will be based upon the resting stability of local spoil material and the surrounding topography.

114. At the some construction sites, such as at Qiangkuang reservoir and Muyu reservoir, fragmented sandstone, shale and mudstone will predominate. In order to facilitate rehabilitation of these sites, topsoil will be stripped, stored safely, and used to cover the surface of the dump on completion of activities at that site. Grass and shrub species will be planted. Where topsoil is poor or in short supply, it will be augmented by mulched vegetation removed from inundation areas and set aside for the purpose. Where rocky spoil predominates, the site will initially be planted with grasses only to be followed by shrub and tree plantings only after grasses have fully established. These measures have been incorporated into the EMP.

5. Waste discharge from construction camps

115. The discharge of wastewater from construction camps could create potential new pollution sources, and also could be sources of sludge, solid waste, and waste oil from machinery maintenance.

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Sewage and other wastewater from construction camps will be collected and treated at septic tanks before discharge to avoid contamination of the surrounding areas. Where possible, the treated wastewater will be discharged directly to the landscape water body which belongs to class V water quality limitation. The treated water can meet such standard requirement. It will be not allowed to discharge the construction camps waste water into the reservoir water body. The spoil sediment disposal sites should be clay-lined to minimize leaks. Temporary land occupation will be planned well in advance to minimize the effect of the disturbance, and land will be reinstated to its original condition upon completion of construction. Topsoil will be removed and stockpiled for use during land restoration. Pay attention to the epidemic prevention and quarantine work of the Construction workers and immigrants to avoid the outbreak and spread of epidemic diseases and to protect the public health in the construction area and immigrants’ resettlement areas.

6. Upstream watershed protection

116. Currently there are no reservoir protection zones in the upstream areas of the 9 reservoirs. Although only 1 out of the 9 reservoirs (Muyu Reserovoir) is supplying drinking water, the water quality of all 9 reservoirs meets the related standards Class III (drink water sources) or Class IV, without such reservoir protection zones. Considering changes of land utilization and activities in the upstream areas of the 9 reservoirs in future, the project will identify watershed management measures for the subproject reservoirs to improve reservoir water quality and reduce sedimentation.

F. Land Acquisition and Resettlement

117. According to the resettlement plans for 8 reservoir rehabilitation subprojects, the construction of these subprojects will involve permanent acquisition of 440 mu or 29 ha of land areas among 18 administrative villages from 6 counties or cities. According to the detailed impact survey, among total acquired land areas, 278 mu or 63% are farmland. Along with land acquisition, 2,204 m2 of houses would be demolished, relocating 12 households and 53 persons. In addition, a range of attachments would be removed or relocated, such as about 23,000 fruit and timber trees with different sizes, 81 tombs, and 3 wells.10 Following national law and local regulations, detailed resettlement plans have been prepared to deal with such impacts, which include detailed scope of impacts, and proposed resettlement policies, rehabilitation options, and compensation accepted by the affected people.11

118. The implementation of the project components will require of permanent land acquisition. Land acquisition and resettlement impacts have been identified; and resettlement plans (RPs) have been prepared in accordance with PRC laws and regulations and ADB’s Policy on Involuntary Resettlement. The RPs provide a socioeconomic profile of affected persons and scope of impacts, and they address issues related to compensation entitlement, the legal framework, public consultations, grievance procedures, environmental protection, rehabilitation measures, and budget and implementation milestones. Resettlement requirements have been carefully considered and incorporated into the project design.

G. Cumulative Impacts

119. No cumulative impacts have been identified during the environmental assessment. The subprojects will mainly bring benefits in terms of water availability and better water resources management. The construction impacts are localized and can be mitigated to acceptable levels.

H. Cultural Relics and Physical Cultural Resources

120. Within the direct impact areas of the proposed project, no cultural relics have been identified.

10 The project will not adversely affect the ground water levels in the project areas. 11 Includes compensation for the relocation of the 81 toms and 3 wells accepted by the affected people.

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I. Potential Adverse Impact and Mitigation Measures during Operation Phase

121. During operation of the project components, there is the potential for soil erosion to result from neglected maintenance of the erosion control structures in prone areas or the failure to maintain landscaping along the reservoir bank. To minimize this impact, regular inspections will be undertaken to ensure that the drainage structures and re-vegetated areas are maintained in accordance with the requirements of the soil erosion prevention plan. Maintenance of bank slopes, cuts, and embankments, such as stabilizing and replanting, if necessary—will be carried out regularly during bank operation. Maintenance of such areas will be budgeted as part of the regular erosion control infrastructure maintenance programs. The local water resource bureau and environmental monitoring station will undertake regular monitoring of erosion prevention and control measures during the operation phase. Numerous measures will be implemented during construction to minimize the potential for soil erosion, including retaining walls in disposal areas and drainage interception ditches near slopes. Once the construction/borrowing/disposal operation is completed, the disturbed areas will consist of permanent interception ditches, pavement, re-cultivation and landscaping with grass, shrub, and/or trees. The mitigation efficiency of soil erosion control can be reach at 70% in the first year of construction, if the measures have been adopted appropriately. Implementation of these measures will be monitored by an independent supervision body. Soil erosion intensity is expected to be reduced if these measures are appropriately implemented, but the incremental increase in soil erosion cannot be completely avoided. However, such an increase will be limited to the construction period and impact will be negligible a few years following completion of construction.

122. During the operating period, solid wastes and wastewater will be generated by the people who visit the reservoirs as well as any auxiliary facilities. This impact will happen at all of the nine reservoirs. Garbage bins will be placed in the some places, the collected solid waste will be sent to the landfill. Wastewater will be directed to the landscape water body which is belong to class ⅴ water quality limitation or to be used for greenbelt irrigation or garden vegetation irrigation.

123. The principal air quality impacts during operation will come from emissions of vehicles on the road along or nearby the reservoirs. According to the PRC regulations on vehicular emissions, all vehicles must now pass the Euro-III equivalent test as part of the annual vehicle safety and environmental protection inspection. Random spot checks are conducted in the subproject cities, and noncompliance will result in a fine and a deadline for repairs to meet the emissions standard.

VII. ANALYSIS OF ALTERNATIVES

A. No Project Alternative

124. The project will rehabilitate and strengthen nine reservoirs, currently classified in the most unsafe category of Class III and provide institutional and management strengthening to the implementing and executing agencies. The no action alternative would result in (i) continuation of the potential failure risks of the reservoirs, including the risk to down slope lives, property and livelihoods, (ii) no improvement to regulation of water flows from reservoirs, continuing the problems with downstream water supply for agricultural practices, house hold use and environmental flows, and (iii) delay in the implementation of sustainable reservoir practices and improved monitoring.

B. Discussion of Alternative Solutions

125. For each subproject, feasibility study and preliminary design reports were prepared by the county government and approved by the Shandong Provincial Development and Reform Committee. In a Feasibility Assessment Report for Subprojects prepared under the project preparatory technical assistance financed from ADB grant, the rehabilitation design of each subproject reservoir was appraised and its feasibility was confirmed in terms of technology, environment, and cost effectiveness.

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126. The design of each subproject was formulated based on an assessment of alternative solutions. Various alternatives were considered for routes of reservoir management roads and temporary construction roads, temporary stock yards, spillway gates, technologies and materials for dam and spillway rehabilitation, etc. The recommended sites and routes for the individual subprojects were selected from various alternatives so as to minimize adverse impacts on the environment and land resources. Engineering and technological alternatives were evaluated based on pre-defined environmental and economic criteria.

127. Potential environmental impacts resulting from project implementation are focused during the construction phase and result primarily from the impacts of construction works, as detailed above. Aside from the no action alternative, construction phase impacts are mitigated by strict adherence to thorough environmental management plan.

VIII. ENVIRONMENTAL ECONOMIC ASSESSMENT

A. Overall Benefit

128. The project's socio-economic benefits are (i) mitigation of threat of reservoir failures and flood damage for 1.04 million population in 1,303km2 of the downstream areas of the 9 reservoirs; and (ii) increase of irrigation water from 143.1 million m3/year to 183.5 million m3/year, and increase of irrigated area from 27,347 ha to 38,273 ha in the down stream areas of the 9 reservoirs. Other benefits include increase in aquaculture production in Huacun, Qiangkuang, Renhe, and Songshan Reservoirs, stabilized drinking water supply from Muyu Reservoir, enhanced power generation capacity of Qiangkuang and Songshan Reservoirs, and temporary employment created during the construction for local communities.

B. Environmental Protection Investments

129. The total incremental environmental protection investment (Table 6) is estimated at $330,700 (or CNY 2,249,000). They cover, among others, the costs of (i) preparing the EIAs, (ii) implementing the EMP, (iii) site monitoring and mitigation, (iv) environmental personnel training, and (v) environmental supervision and monitoring. Environmental costs have been listed as part of the project costs.

Table 6 - Environment Protection Investment

Total of Mitigation Environmental Environmental subproject Measures Monitoring Administration (CNY) (CNY) (CNY) (CNY) Qianghuang Reservoir 467,000 179,000 114,000 174,000 Renhe Reservoir 490,000 233,000 154,000 103,000 Shizuizi Reservoir 136,000 41,000 55,000 40,000 Songshan Reservoir 228,000 95,000 95,000 38,000 Longwantao Reservoir 82,000 39,000 29,000 14,000 Anjing Reservoir 97,000 35,000 29,000 33,400 Yangzhuang Reservoir 84,000 37,000 30,000 17,000 Huacun Reservoir 82,000 36,300 27,000 19,000 Muyu Reservoir 476,000 214,000 167,000 95,000

Total of the project 2,142,000 909,000 700,000 533,000 CNY = Chinese yuan

C. Environmental Benefits

130. The project is expected to provide significant environmental benefits such as strengthening of integrated water resources management and allocation, provision and improvement of environmental flows, adaptation to climate change (through increased resilience to changing occurrences of droughts

27 28 and floods), and reduction of dam failure risks. Improved quantity of reservoir releases, especially in the dry season, can provide water to sustain wetlands and the health of flora and fauna, maintain fisheries,12 preserve water quality, and improve groundwater resources. Adverse environmental impacts of the project will be mainly construction impacts, which are expected to be minimal and adequate mitigation measures will be implemented that can adequately reduce the impacts to acceptable levels.

D. Economic Internal Rate of Return

131. Economic analysis was undertaken for individual reservoirs and the project as whole. Primary economic benefits identified for the project are enhanced flood control. Considering future growing occurrence of extreme weathers as a result of climate change, flood control benefits cannot be overstated. Flood control benefits of reservoirs were estimated by respective reservoir design institutes based on extensive survey data and flood mapping. Secondary benefits include increased crop production as a result of increased irrigated land area, and increased aquaculture production stemming from increased water retention. Economic internal rate of return (EIRR) of the project is 16.2% and those of individual reservoirs are: 14.8% of Muyu reservoir; 14.9% of Renhe reservoir; 17.3% of Songshan reservoir; 15.0% of Qiangkuang reservoir; 17.3% of Shizuizi reservoir; 17.5% of Longwantao reservoir; 17.5% of Huacun reservoir; 20.8% of Yangzhuang reservoir; and 20.6% of Anjing reservoir. The EIRRs demonstrate that the project is economically viable at both individual reservoir level and project level. Sensitibity analysis further confirmed that economic viability is quite robust even under cost increases and/or benefit declines in the future.

IX. INFORMATION DISCLOSURE AND PUBLIC CONSULTATIONS

A. Information Disclosure and Public Consultations to Date

132. Consultations have been held with government agencies, including the National Development and Reform Commission, the Ministry of Finance, the Ministry of Water Resources, the Shandong Provincial Development and Reform Committee, the Shandong Provincial Finance Department, the Shandong Provincial Water Resources Department, and city and County governments responsible for the subprojects. A social and poverty analysis was conducted based on focus group discussions with key agencies, beneficiaries, and adversely affected communities, with emphasis on poverty villages and potential gender issues. For the preparation of resettlement plans, public consultations and information disclosures to the affected persons are being conducted. Public consultations are also being conducted for the environmental assessment.

133. Several rounds of public consultations with various stakeholders groups were conducted during the course of feasibility studies and the preparation of the EIAs and IEE reports (Table 7). The timing of public consultations was from February 2007 (Songshan Reservoir) to October 2009 (Longwantao and Huacun Reservoirs). The consultations included: (i) informal visits to communities and households in the project areas; (ii) questionnaire surveys; and (iii) a wider stakeholder meeting attended by representatives of the affected public and other concerned stakeholders. Those affected by land acquisition and resettlement were consulted throughout the process of resettlement planning and social and poverty impact studies, using a variety of public consultation techniques including questionnaire surveys, community meetings, focus group discussions, key informant interviews and household visits that were carried out by local design institutes, the project consultants, and ADB missions.

12 In Huacun, Qiangkuang, Renhe, and Songshan Reservoirs, the reservoir administration offices are conducting fish aquaculture. The reservoir administration offices buy and bring frys, breed them in the reservoirs, and sell them. Fish will be sold before the construction works. The aquaculture will be restarted after project infrastructure rehabilitation. The project will, therefore, not need to provide flows to sustain the aquaculture during the construction period. Improved water retention of these 4 reservoirs will increase aquaculture.

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Table 7 - Summary of Information Disclosure and Public Consultations

Government Agencies Stakeholder Groups Questionnaires Qiangkuang November 2007, November 2007, and June June 2009 Reservoir feasibility study 2009 EIA study EIA study Renhe Reservoir May 2005, feasibility study March 2006, EIA study, 62 March 2006, EIA study persons of stakeholders Shizuizi Reservoir November 2007, feasibility May 2008, EIA study, 83 May 2008, EIA study study persons of stakeholder Songshan June 2006, feasibility study March 2007, and June 2009 June 2009 EIA study Reservoir EIA study, 74 Persons of stakeholders Longwantao November 2008, feasibility September 2009, EIA study September 2009, EIA Reservoir study study Anjing Reservoir November 2008, feasibility June 2009, EIA study June 2009, EIA study study Yangzhuang June 2008, feasibility study June 2009, EIA study June 2009, EIA study Reservoir Huacun Reservoir December 2008, feasibility September 2009, EIA study September 2009, EIA study study Muyu Reservoir November 2007, feasibility February 2007 and June June 2009, EIA study study 2009, EIA study, 48 Persons EIA = environmental impact assessment

134. During the preparation of the domestic EIA reports, more than 600 questionnaires were distributed to people living in the project areas. The EIA institutes conducted informal interviews with local residents, totalling more than 60 times. The project consultants conducted consultations with relevant government agencies, particularly those with responsibilities for macroeconomic planning; environmental protection; soil erosion control; land resource management. Information about the project, the anticipated environmental impacts, and proposed mitigation measures ware disseminated through a variety of formats, including overhead presentations, prefaces in the questionnaires, and the internet. Wider stakeholder meetings were held in May, June and September, drawing over 300 participants from key municipal government agencies of the project cities, district government agencies, and local communities. The domestic EIA documents were also disclosed on the local medium. The purpose of these wider stakeholder consultations was to present the preliminary findings of the environmental impact assessment process to the general public, and solicit their comments and suggestions for reviewing the potential impacts and mitigation measures, and refining the EMP.

B. Consultation Results

135. The consultations revealed that 95%–98% of the consulted public are supportive of the project, with the rest being unsure. The expected benefits include promotion of sustained region development, protection of people from the threat of flooding, more irrigation water resources, better prospect for outside investment and better prospect for socioeconomic development. The anticipated negative impacts include possible noise pollution, air pollution from vehicles, and land acquisition and resettlement. The consulted public made several suggestions for mitigating the potential adverse environmental and social impacts: (i) construction activities close to residential areas should stop between 10:00 pm and 7:00 am; (ii) heavy construction equipment located in close proximity to schools and residential areas should be fitted with noise suppression apparatus; (iii) dust-generating construction vehicles should be covered and dusty construction areas sprayed with water; (iv) affected people should be properly compensated in accordance with PRC land compensation policies. The suggestions have been incorporated in the EIA and IEE reports. Concerns that are beyond the scope of the environmental assessment, such as a resettlement plan and protection of existing infrastructure during construction, have been conveyed to relevant authorities.

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136. All of the consulted relevant government agencies of the project cities express their strong support to the project and their willingness to undertake the corresponding responsibilities for the proposed component environmental administration.

C. Future Information Disclosure and Public Consultation Program

137. Information disclosure and public consultations to safeguard the environment and local communities from undue impacts will continue throughout construction and into the operation phase. During construction, the consultations will be undertaken regularly in the forms of formal questionnaire surveys and informal interviews by the on-site environmental engineers of the construction contractors, the environmental management consultant (EMC), and independent environmental monitor (IEM) of the local residents living in the project areas, especially those around the construction sites. The consultations will focus on public complaints about community annoyances from construction activities, such as construction solid waste and waste water, as well as public concerns about the ecological protection and resettlement. Immediate adjustments will be undertaken to address any public complaints and concerns.

138. During the first 2 years of operations, the EMC will continue with the regular public consultation program. Thereafter, public complaints and concerns will be channelled through the city EPB hotlines.

X. GRIEVANCE REDRESS MECHANISM

139. In order to settle unforeseen issues effectively, an effective and transparent channel for lodging complaints and grievances has been established. The grievance redress mechanism is detailed in the EMP in Appendix 2.

XI. ENVIRONMENTAL PLANNING AND MANAGEMENT

140. The objective of establishing an EMP is not only to propose appropriate mitigation measures, but also to recommend establishment of institutions or mechanisms to monitor and ensure compliance with environmental regulations and implementation of the proposed mitigation measures. Such institutions and mechanisms will seek to ensure continuously improving environmental protection activities during preconstruction, construction, and operation in order to prevent, reduce, or mitigate adverse impacts. The EMP draws on the individual EIA reports and on the project discussions and agreements with the relevant government agencies.

141. The EMP for the Risk Mitigation and Strengthening of Endangered Reservoir in Shandong Province Project is presented in Appendix 2. The EMP will be reviewed and updated at the end of the detailed design in order to be consistent with the final detailed design.

A. Mitigation Measures

142. The EMP contains measures to mitigate the potential environmental impacts. The responsibilities for implementing and supervising these measures are also assigned to different agencies. Details of the mitigation measures can be found in Appendix 2.

B. Organizational Structure for Environmental Management

143. The PPMO will be responsible for setting up the environmental management system, consisting of inspection, monitoring, reporting, and initiating corrective actions or measures. In the design stage. The PPMO and IAs will pass the EMP to the design institutes for incorporating mitigation measures into the detailed designs. The EMP will be updated at the end of the detail design, and finally be passed to the construction contractors. To ensure that contractors will comply with the EMP’s provisions, the PPMO and IAs will prepare and provide the following specification clauses for incorporation into the bidding

30 31 procedures: (i) a list of environmental management requirements to be budgeted by the bidders in their proposals; (ii) environmental clauses for contractual terms and conditions, and (iii) full EIAs and IEE for compliance. The PPMO, IAs, and contractors will each nominate dedicated, trained, and qualified environment specialists to undertake environmental management activities and ensure effective EMP implementation. Each IA will set up an environmental management unit (EMU). IEMs contracted by the IAs will be responsible for inspection, monitoring, and evaluating implementation of mitigation measures.

144. Environmental training will be essential for IAs and contractors to implement the EMP. The PPMO will be responsible for organizing training programs, which will cover (i) environmental laws, regulation and policies; (ii) implementing mitigation measures; (iii) environmental technologies and procurement; (iv) operating and maintaining environmental facility; (v) environmental monitoring, supervision; and (vi) documentation and reporting.

C. Inspection, Monitoring, and Reporting

145. The PPMO will nominate at least one qualified full-time environmental management staff member to undertake environmental management and monitoring activities. The PPMO will further recruit one EMC to assist itself and IAs including local project management offices (LPMOs) in carrying out internal environmental monitoring and inspections, reporting to ADB through quarterly project progress reports, semi-annual environmental monitoring reports, and a project completion report, and conducting necessary training. The PPMO, with assistance from the EMC, will submit to ADB quarterly project progress reports and semi-annual environmental monitoring reports on the progress of the EMP, information on project implementation, the environmental performance of the contractors, and environmental compliance. In addition, within 3 months of physical completion of the project, the PPMO will submit to ADB a project completion report that describes the achievements in relation to the project's expected impact, outcome, and outputs including environmental terms.

146. The local EPBs will delegate compliance monitoring to the local EMSs. The EMSs will conduct regular and random environmental monitoring activities before, during, and after construction, as well as in the event of emergencies. The compliance monitoring reports will include: (i) project background, (ii) construction and operation activities, (iii) environmental conditions, (iv) measurement or sampling taken during auditing and their locations, (v) analytical results, (vi) interpretation and implication of the monitoring results, (vii) determination of the compliance status with regard to applicable regulations and standards, and (viii) recommendations for improvement. These reports will be submitted to the IAs which will forward to SPEPD, city and county EPBs, and the PPMO.

147. Within 3 months after each subproject completion, or no later than 1 year with permission from the responsible environmental authorities, environmental acceptance monitoring and audit reports will be (i) prepared by qualified environmental institutes in accordance with the MEP Guideline on Project Completion Environmental Audit (2001), and (ii) reviewed for approval by the local EPBs. The reports will focus on the project compliance of environmental performance when it is put into the operation. The reports will be sent to environmental authorities for review and approval and also to the PPMO through the IAs.

148. Local environmental monitoring agencies and/or companies will be engaged by IAs as IEMs. Each IEM will include an environmental safeguard specialist to conduct independent environmental monitoring. The independent environmental monitoring will be conducted to ensure that contractors appropriately implement mitigation measures. IEMs will submit independent environmental monitoring reports on a semi annual basis to IAs which will forward to the PPMO, SPEPD, and city and county EPBs. The reports will emphasize: (i) progress made in implementing the EMP, (ii) implementation of mitigation measures, (iii) environmental compliance, (iv) institutional strengthening and training, (v) public consultations, and (vi) problems occurred and corrective actions taken. IEMs will also assist SPG including the PPMO to prepare quarterly project progress reports, semi-annual environmental monitoring reports, and a project completion report.

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149. Results of the all reports mentioned above will be used for assessing: (i) the extent and severity of the environmental impacts against the predicted impacts, (ii) performance or effectiveness of the environmental protection measures or compliance with pertinent rules and regulations, (iii) trends in impacts, (iv) overall effectiveness of the project EMP, and (v) the need for taking additional mitigation measures.

D. Mechanism for Feedback and Adjustment

150. The EMP and grievance redress mechanism will be refined during the detailed design phase of the project when more details will become available. The updated documents will be submitted to ADB.

151. Based on the inspection and monitoring reports, environmental authorities will decide whether: (i) further mitigation measures are required as corrective action, or (ii) improvement is required to environmental management practices. If it is found during the monitoring and inspection exercise that there has been substantial deviation from the EMP or any changes made to any of the subprojects, which may cause substantial adverse environmental impacts or an significant increase in the number of affected people, the PPMO should consult with the SPEPD and ADB immediately and form an EIA team to conduct additional environmental assessment and, if necessary, further public consultation. The revised EIA reports will be submitted to environmental authorities and to ADB for review and approval.

E. Environmental Management Capacity in the Subproject Municipality

152. City or county EPB consists of five sections and three institutions. The five sections cover EIA, pollution control and planning, regulatory affairs and public education, public information office, and general administration. The three institutions include the EMS (fully government funded), inspection and enforcement brigade (fully government funded), and the environmental science research institute (partially government funded). MEP issued the class B EIA certificate for the environmental science research institute.

153. The EMSs are certified on an annual basis by the national environmental monitoring network. Regular professional training is provided by the national, provincial, and local EPBs and monitoring centers for knowledge and skills upgrading. The EMSs are fully equipped for compliance monitoring (existing pollution sources and completion inspection and monitoring of new projects) and ambient air and water quality monitoring. In addition to conventional equipment, its laboratories have some advanced monitoring equipments. Each of the environmental monitoring stations provides more than 20,000 to 30,000 monitoring data items each year.

154. Ambient environmental monitoring is done regularly at several air monitoring points where automated continuous monitoring of SO2, NO2 , and PM10 is undertaken. According to MEP and SPEPD requirements, air quality, in the form of the air pollution index, is reported daily to the Shandong EPB.

155. The EMSs are provided with adequate capacity to conduct compliance and ambient monitoring. It will be able to provide adequate environmental monitoring support required by this project.

XII. CONCLUSION AND RECOMMENDATION

1. Project Benefits

156. The project is expected to provide significant environmental benefits such as strengthening of integrated water resources management and allocation, provision and improvement of environmental flows, adaptation to climate change (through increased resilience to changing occurrences of droughts and floods), and reduction of dam failure risks. Improved quality of reservoir releases, especially in the

32 33 dry season, can provide water to sustain wetlands and the health of flora and fauna, maintain fisheries, preserve water quality, and improve groundwater resources.

2. Environmental Safeguard Assurances

157. An EMP with a detailed environmental monitoring program and institutional strengthening and training program was developed as part of the IEE, on the basis of the domestic EIAs. The EMP proposes appropriate mitigation measures through the duration of the project cycle; and establishes mechanisms to monitor and ensure compliance with environmental regulations and implementation of the proposed mitigation measures. It seeks to ensure continuously improving environmental protection activities. This mechanism is carefully designed to fit into the PRC’s existing management system for environmental management.

158. The main project risk relates to the low institutional capacity of the IAs, including their lack of experience in working with international financing institutions, limited awareness of ADB requirements, and lack of environmental management staff. The following measures are proposed to mitigate these risks: (i) specific assurances to implement the mitigation measures in the EMP; (ii) capacity building for IAs, including staffing and training; (iii) appointment of project implementation and monitoring consultants/companies, including EMS and IEMs; (iv) clear definition of roles and responsibilities for EMP implementation, performance monitoring, and mechanisms for feedback and adjustment; (v) role of city and county EPBs and SPEPD in environmental inspection and supervision; and (v) project reviews and monitoring by ADB.

159. Assurances and covenants related to the environmental aspects of the project are required as follows:

(i) A Steering Committee, set up in SPG, led by Vice Governor of SPG, and comprising the key provincial authorities for Project implementation, such as Shandong provincial Finance Department, Development and Reform Committee, and Water Resources Department, shall provide overall guidance and coordination for Project implementation and resolve issues occurred during Project implementation which are outside of immediate Project control.

(ii) SPG through the PPMO shall cause each IA to construct, maintain, and operate the project facilities including those which are fully funded from counterpart funds in strict conformity to (i) all applicable national, provincial and local government environmental laws, regulations and procedures; (ii) ADB’s Safeguard Policy Statement (2009); and (iii) the environmental mitigation and monitoring measures set out in the Aggregate IEE, EMP and EIAs for the Project.

(iii) SPG through the PPMO shall ensure that (a) requirements for mitigation implementation are incorporated into all civil works contracts; and (b) environmental performance of the contractors and subprojects is reported and evaluated as part of quarterly project progress reports, semi-annual environmental monitoring reports, and a project completion report.

(iv) SPG through the PPMO shall ensure that the capacity-building program described in the EMP is provided to IAs and the contractors properly and on time.

(v) SPG through the PPMO will report to ADB the project progress on environmental issues through quarterly project progress reports and semi-annual environmental monitoring reports

(vi) SPG shall ensure that, if other water users appear in the same watershed in the future, the provision to present intended users will take precedence for the provision of the agreed upon quantity and quality of project water supply.

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(vii) SPG through the PPMO shall enable ADB's representatives to conduct due diligence reviews during Project implementation for woks under the Project including those which are fully funded from counterpart funds, to the extend required to mitigate overall Project impacts.

3. Overall Conclusion

160. The project will generate great socioeconomic benefits by promoting sustainable region development. The overall findings of the domestic EIAs and the IEE are that negative impacts on air, water, and acoustic environment are expected, especially during construction. In general these impacts will be temporary and localized. The proposed mitigation measures are prescribed conceptually in the IEE. These measures will be updated into the detailed EMPs during the design stage and continuously refined during construction. The EMPs will be implemented by the IAs and contractors; monitored and supervised by professional environmental management agencies and city environmental monitoring stations; and regularly reported to the PPMO, city EPBs, and ADB.

161. Adverse environmental impacts of the project will be mainly construction impacts, which are expected to be minimal and adequate mitigation measures will be implemented. Any adverse environmental impacts associated with the project will be prevented, eliminated, or minimized to an acceptable level if the EMPs proposed under the EIAs and IEE is effectively implemented, particularly through the mechanism for the continuous refinement and effective implementation of the environmental mitigation measures.

34 Appendix 1 35

Appendix 1 - Project Description

A. Qiangkuang Reservoir

1. The Qiangkuang Reservoir located in the southeast of Qiangkuang village, Zhigou town, Zhucheng city and in the upriver of Weihe River Basin, covers an area of 656 km2 and holds total reservoir storage of 328 million m3. The hydraulic structures are grade-II. Qiangkuang Reservoir is divided into two parts, the east reservoir and the west one, which are connected with each other by a connecting channel. The east reservoir, intercepting main tributaries of Weihe River—Gaoze River (Hongning River) and Zhonggu River, covers a basin area of 386 km2 and holds a maximum storage of 259.81 million m3. The available storage of the east reservoir is 74.75 million m3, the dead water level is 90.00m, and the dead storage is 8.984 million m3. The west reservoir, situated in the southeast in Dongnanling Village, Wanghu Town, Wulian County and intercepting the main course of Weihe River, covers an area of 270 km2 and holds a maximum storage of 68.39 million m3. The available storage of the west reservoir is 11.89 million m3, the dead water level is 93.00m, and the dead storage is 1.94 million m3. The population and assets in the downstream area include Wanghu Town, Wulian County, Zhucheng City, Zhigou Town, Lvbiao Town, Jiutai Town, Changcheng Town, Shunwang Town, Xiangzhou Town, Guojiatun Town, Shiqiaozi Town, and Jiayue Town of Zhucheng Municipality, with over 40 thousand people, 13 thousand ha of farmland, Zhucheng Airport, 206th National Highway, Yanggan provincial road, Xueguan provincial road, Tao-Wei Railway, Ji-Qing Express Way, and Binhai Industrial Zone. Qiangkuang Reservoir is used for flood control, irrigation, hydropower generation, and aquaculture. 2. The project works include: 1) reinforcement of the east reservoir dam; 2) reinforcement of the west reservoir dam; 3) reinforcement of the spillway; 4) reinforcement of the east drainage tunnel and west drainage tunnels; 5) connection channel project; 6) flood-prevention transportation project; 7) construction management establishment; and 8) resettlement, water protection, environment protection.

3. Based on the field survey for construction map design (CMD), the engineering risk mitigation and strengthening will not raise the normal storage level of the reservoir (98.5 m) nor the elevation of dam crest. Therefore, it will not increase the inundation-affected area of upstream reservoir area. However, flood control roads with the length of 3,469 m and a connecting channel with the length of 120 m will acquire 32.01 mu of land permanently, including 16.05 mu of arable land, 12.54 mu of forest land, 3.2 mu of country roads. In the permanently acquired land, there are 12.07 mu of collective land in 4 villages and 19.94 mu of farmer contracted land in 5 villages which affect 92 households with 324 persons. Temporary roads, facilities for construction, and disposal areas will temporarily acquire 113.3 mu of land, including arable land of 59.23 mu, forest land of 46.57 mu, and country road of 7.5 mu. The temporary land use will affect 45 households with 207 persons.

B. Renhe Reservoir

4. Renhe Reservoir is located at the middle reaches of Renhe River, which is part of the Zihe River tributary of Xiaoqing River water system. Covering a control catchment of 80 km2, the reservoir has a total storage capacity of 26.32 million m3. As a medium-sized reservoir with comprehensive functions, the reservoir is used for flood control, irrigation, and aquaculture. Currently, the upstream areas of the reservoir includes three villages (Tangzhuang, Shengyukou, and Juzi) with 1,000 people, 57 ha of

35 Appendix 1 36 farmland, 800 houses, and 6,000 m2 of buildings. The downstream areas include Jiao-Ji Railway, 309th National Road, Jiao-Wang Road, and Shengli Petrochemical General Plant. 5. The project works include: 1) reinforcement of the gravity dam (anti-seepage and reinforcement of the dam body and dam base, construction of drainage tunnels in the dam base); 2) reinforcement of the earth dam (anti-seepage and reinforcement of the dam body and dam base, and treatment of a joint between the gravity dam and the earth dam); 3) reinforcement of the spillways (construction of reinforced concrete aprons under the flip bucket of weir dam, construction or supporting of side walls of the spillways, and bottom protection of spillways); 4) reinforcement of drainage tunnels (reinforcement of the tunnels body, and replacement of the sluice gate, drainage valves, and other metal and electromechanical devices); 5) replacement of the electrical devices and management facilities for the dam and drainage tunnels. 6. Based on the field survey for CMD, the engineering risk mitigation and strengthening will raise the normal storage level of the reservoir and the elevation of dam crest only by 0.1 m cm to 336.1 m, which will increase the inundation-affected area of upstream reservoir area only by 0.01 km2 . However, the spillway construction will acquire 11.15 mu of land, involving Nanfuwang Village of Miaozi Town. According to land use, it includes 1.65 mu of bottomland, 1.5 mu of forest land, 6 mu of orchard, and 2 mu of breed livestock land. 7 households with 20 persons will be affected by permanent land acquisition. All land is farmer contracted land. Temporary road and facilities for construction will acquire 9.5 mu of land, involving Nanfuwang Village of Miaozi Town. According to land use, it includes 8 mu of arable land and 1.5 mu of breed livestock land. 9 households with 37 persons will be affected by permanent land acquisition. 2 households (120m2) with 10 people will be removed. In addition, some trees and some special facilities will be affected.

C. Shizuizi Reservoir

7. Shizuizi Reservoir is located about 500m away from the south of Shizuizi Village in Shanting District, Zaozhuang City and at the upstream north tributary of Shizi River, and covers a control basin area of 49.5 km2. Currently, the downstream areas include two towns (Shancheng, Xuzhuang) with over 200 thousand people, several large-scale coal mines (Chaoyang, Binhu), Jing-Fu Express Way, Jing-Hu Rail Way, 104th National Highway, and farmland of 2,800 ha. 8. Shizuizi Reservoir is a key medium-sized reservoir being used for flood control and irrigation. The main rehabilitation works are: 1) reinforcement of earth-filled dam body; 2) reinforcement of the masonry dam; 3) spillway excavation and consolidation; 4) reinforcement of the spillway gate; and 5) reconstruction of office building in management area and warehouse.

9. Based on the field survey for CMD, the project will not raise the normal storage level of the reservoir (119.74 m). Therefore, it will not increase the inundation-affected area of upstream reservoir area. No land will be acquired permanently or temporarily. All engineering works and construction activities will be implemented on unused land within the reservoir management area.

D. Songshan Reservoir

10. Songshan Reservoir is located at the tributary of Mihe River and upper reaches of Shihe River, 25 km southwest of Linqu County, controlling an area of 151 km2. It is a medium-sized reservoir that serves for flood control and irrigation as well as aquaculture and hydropower generation. Currently, the

36 Appendix 1 37 downstream areas include three counties (Linqu, Qingzhou and ) with over 320 thousand people, Jiao-Ji Railway, Ji-Qing Express Way, over 100 large and medium-sized enterprises, and 1,300 ha of farmland.

11. Main rehabilitation works are: 1) reinforcement of the dam (anti-seepage wall installation, upstream slope sand-shell pressure, dam foot stone compression, revetment demolition and reconstruction, core wall filling and grouting, and anti-wave wall demolition and reconstruction); 2) reinforcement of the spillway;; iii) removal and reinstallation of the spillway gate.

12. Based on the field survey for CMD, the engineering risk mitigation and strengthening will not raise the normal storage level (289 m) of the reservoir nor the elevation of dam crest. The rehabilitation works will require 235.5 mu of permanent farmland acquisition affecting 50 households with 148 people and will no require temporary land acquisition. 2 households with 331 m2 and 10 people will be relocated.

E. Longantao Reservoir

13. Longwantao Reservoir is located on the upstream of Ji River—tributary of Xisi River, Nansi Lake water system, Huai River basin, south of the Chengguan Town, Sishui County, Jining City. The catchment area is 143km2 and the total reservoir storage is 52.15 million m3. The downstream areas currently include over 250 thousand people of towns and cities of Sihui, , Yanzhou, Jining, 13,300 ha of farmland, Jin-Pu Railwa, Yanshi Railway, 327th National Road, Jing-Fu Express Way, and Yanzhou Mine. This reservoir is used for flood control, irrigation, and limited industrial water supply.

14. After the reinforcement of Longwantao reservoir, the normal water level will remain at 149.86m. Main rehabilitation works are: 1) reinforcement of the dam (concrete anti-percolation in the dam body, curtain grouting for anti-percolation in the dam base, reconstruction of the slope protection upstream, reinforcement of roads on the dam crest, reinforcement of anti-wave wall on the upstream dam shoulder, etc.); 2) reinforcement of the spillway and gate; 3) reinforcement of the outlet; and 4) office construction, road improvement, and irrigation river channel improvement.

15. This subproject will not require permanent land acquisition. All engineering works will be constructed on land within the reservoir management scope. The borrow area, spoil area and construction camps will temporarily use 69.3 mu of land, including dry land of 14.3 mu, orchard of 15 mu, and shrub land of 35 mu with 60 households and 220 people to be affected in Longwantao Village. 1 house with 200m2 and 5 people will be relocated from Longwantao Village. Some associated auxiliaries, basic infrastructure, and facilities will be affected. F. Anjing Reservoir Works

16. Anjing Reservoir is located 20 km east of Pingyi County. It is a medium-sized reservoir on Jinxianhe River, a tributary of Junhe River of Yihe River water system. The upstream areas of the reservoir are low mountains and hills. The control catchment area is 35.12 km2. The downstream areas currently include 40,000 people in Bianqiao Town and Difang Town, farmland of 2,000 ha, Wen-Si Road, Ri-Dong Express Way, Yan-Shi Railway, and 327th National Road. This reservoir is used for flood control and irrigation. 17. main rehabilitation works are: 1) reinforcement of dams (unti-seepage works, upstream slope protection, reconstruction of drainage facilities, rehabilitation of the downstream displacement hull, etc.); 2) reinforcement of the spillway and gate; and 3) improvement of the management facilities and add observation facilities.

37 Appendix 1 38

18. Based on the field survey for CMD, the engineering risk mitigation and strengthening will not raise the normal water level of the reservoir (154.0 m) nor the elevation of dam crest. Therefore, it will not increase the inundation-affected area of upstream reservoir area. However, the land requisition of the spillway construction will permanently acquire 4.2 mu of irrigable land, involving Liangjiaya Village of Bianqiao Town. 5 households with 29 persons will be affected by the permanent land acquisition. All land is farmer contracted land. Temporary roads and facilities for construction will temporarily acquire 110.8 mu of arable land, involving Liangjiaya Village of Bianqiao Town. 39 households with 120 persons will be affected by the temporary land acquisition. In addition, some trees and special facilities will be affected.

G. Yangzhuang Reservoir

19. Yangzhung Reservoir is located in northeast mountain area of Pingyi County and on Ziqiu River—tributary of Junhe River of the Yihe River water system. The control catchment area is 36 km2. It is a medium-sized reservoir being used for flood control and irrigation. The downstream areas currently include 50,000 people in Ziqiu Town and Difang Town, farmland of 5,666 ha, Wensi Road, 327th National Road, Yan-Shi Railway, Yan-Qing Road, Ri-Dong Express Way, and Lan-Yan Railway.

20. Main rehabilitation works are: 1) dam rehabilitation (dam slope protection, seismic safety works, cutoff in the dam body and foundation, etc.); 2) spillway rehabilitation; and 3) construction of an administration office and instalment of equipment

21. Based on the field survey for CMD, the engineering risk mitigation and strengthening will not raise the normal water level of the reservoir (165.0 m) nor the elevation of dam crest. Therefore, it will not increase the inundation-affected area of upstream reservoir area. However, the spillway construction will acquire 4.8 mu of irrigable land, involving Yangzhuang Village of Ziqiu Town. 4 households with 56 persons will be affected by the permanent land acquisition. All land is farmer contracted land. Temporary road and facilities for construction will temporarily acquire 28.42 mu of arable land, involving Yangzhuang Village of Ziqiu Town. 30 households with 93 persons will be affected by the temporary land acquisition. In addition, some trees will be cut.

H. Huacan Reservoir

22. Huacun Reservoir is located at the midstream of Huanggouhe River—tributary of Sihe River in Huaihe River drainage area, that is, north of Baijiawang Village, Dahuanggou Town, Sishui County. The control catchment area of the reservoir is 143 km2. The reservoir is a medium-sized reservoir that serves for flood control, irrigation, and aquaculture. The downstream areas currently include over 255 thousand people, 13,000 ha of farmland, cities of Sishui (22 km to the dam), Qufu (45 km to the dam), Yanzhou, and Jining, Jing-Hu Railway, Yanshi Railway, Jing-Fu Express Way, Ri-He Express Way, and the large enterprises of Yanzhou Mine and Jidong Coalfield. 23. Huacun Reservoir is a key medium-sized reservoir being used for flood control, irrigation, and aquaculture. Main rehabilitation works are: 1) dam rehabilitation works (cutoff in the dam body, curtain grounting in the foundation, dam slope protection, etc.); 2) improvement of the spillway and gate; 3) outlet reinforcement works; and 4) administration office building and road improvement.

Based on the field survey for CDM, this subproject will not raise the normal storage level of the reservoir (150.99 m) nor the elevation of dam crest. Therefore, it will not increase the inundation-affected area of upstream reservoir area. The subproject will have no permanent land acquisition. All engineering works

38 Appendix 1 39 will be constructed on land within the reservoir management scope. However, the borrow area, spoil area, and construction camps will use 68.6 mu of village land temporarily, including dry land of 22.2 mu, orchard of 12.6 mu, and shrub land of 33.8 mu with 41 households and 164 people to be affected in 3 villages, including Nanhua, Dongchen and Baijiawang Villages of Dahuanggou Township. I house with 405m2 and 6 people will be relocated from Nanhua Village. Some associated auxiliaries, and basic infrastructure and facilities will be affected.

I. Muyu Reservoir

24. Muyu Reservoir is located on the midstream and downstream of Xian River, a branch of Wulong River, 9 km northeast of Laiyang City, Shandong Province. It covers 455km2 of control catchment area, with a total capacity of 182.7 million m3 and engineering grade-II. The reservoir is a multipurpose reservoir that serves for flood control, irrigation, and water supply for domestic and industrial users. The geographical position is important and the social and economic profits are remarkable. The downstream areas currently include over 400,000 people in towns along the river and Laiyang City, 4,000 ha of farmland, Yan-Qing Road, and Lan-Yan Railway.

25. Aiming at the safety problems of Muyu Reservoir, the risk mitigation and strengthening project mainly includes: 1) dam rehabilitation (cutoff and grouting in the dam body and foundation, dam slope protection, dam crest reconstruction, etc.); 2) rehabilitation of the spillway and gate; 3) outlet rehabilitation; 4) construction of administration office and flood management roads; and 5) installation of hydrology facilistie and computer control system. Based on the field survey for CMD, the engineering risk mitigation and strengthening will not raise the normal water level of the reservoir (81.96 m) nor the elevation of dam crest. Therefore, it will not increase the inundation-affected area of upstream reservoir area. However, the land requisition of the flood control road with the length of 470m will acquire 15.2 mu of land permanently, including 2.6 mu of orchard and 12.6 mu of slope wasteland. The slope wasteland is the collective owned land of Muyu Village. The permanent land acquisition of 2.6 mu of orchard will affect 11 households with 41 persons. The subproject will not require temporary land acquisition nor house demolition. Some lotus trees owned by the Reservoir Administration Bureau will be affected.

39 Appendix 2 40

Appendix 2 – Environmental Management Plan

CONTENTS

A. Objectives 41 B. Summary of Potential Impacts and Mitigation Measures 41 C. Environmental Monitoring and Inspection 48 D. Public Consultation 50 E. Responsibilities and Authorities for Implementation 51 F. Institutional Strengthening and Training 53 G. Reporting and Supervision 55 H. Work Plan 57 I. Cost Estimates for Environmental Management 57 J. Mechanism for Feedback and Adjustment 58 K. Grievance Redress Mechanism 58

40 Appendix 2 41

ENVIRONMENTAL MANAGEMENT PLAN

A. Objectives

The objective of establishing an environmental management plan (EMP) is to propose appropriate mitigation measures, and recommend establishment of institutions or mechanisms to monitor and ensure compliance with environmental regulations and implementation of the proposed mitigation measures. Such institutions and mechanisms will seek to ensure continuously improving environmental protection activities during project preparation, construction, and operation in order to prevent, reduce, or eliminate adverse impacts.

The EMP includes: (i) objectives, (ii) summary of impacts and mitigation measures, (iii) environmental monitoring and inspection, (iv) public consultations, (v) responsibilities and authorities for implementation, (vi) institutional strengthening and training, (vii) reporting and supervision, (viii) work plan, (ix) cost estimates, and (x) mechanism for feedback and adjustment. The EMP will be reviewed and updated at the end of the detailed design in order to be consistent with the final detailed design.

B. Summary of Potential Impacts and Mitigation Measures

Potential environmental issues and impacts during the pre-construction, construction and operation phases, as identified by the individual domestic environmental impact assessments (EIAs), as well as corresponding mitigation measures designed to minimize the impacts are summarized in Table A2.1. The mitigation measures will be incorporated into the tendering documents (where appropriate), construction contracts and operational management plans, and will be undertaken by contractors, the implementing agencies (IAs) under the supervision of the provincial project management office (PPMO) and the city county environmental protection bureaus (EPBs), and the Shandong provincial Environmental Protection Department (SPEPD) when necessary. The effectiveness of these measures will be evaluated based on the results of the environmental monitoring to determine whether they should be continued or improvements should be made. Improvements need to be confirmed through stipulated environmental management procedures.

Resettlement plans have been prepared to ensure that the affected persons will be made better off or at least not worse off because of the project. Details of the required actions are given in the individual resettlement plans for the individual subprojects.

Table A2.1: Summary of Potential Impacts and Mitigation Measures Impact Factor/ Potential Mitigation Measures Project Supervising Stage Impacts and/or Implementing Agency Issues Company A. Pre-Construction 1. EIA and Feasibility Site/alignment  The recommended sites/ routes Design SPDRC, Study Stage selections for the individual subprojects were Institutes, EIA SWRD, city selected from various alternatives institutes, IAs and county so as to minimize adverse DRCs, city impacts on the environment and and county land resources. WRBs, city and county EPBs Engineering  Engineering and technological Design SPDRC, and alternatives were evaluated based Institutes, EIA SERD, city technological on pre-defined environmental and institutes, IAs and county alternatives economic criteria. DRCs, city and county WRBs, city and county EPBs

41 Appendix 2 42

Impact Factor/ Potential Mitigation Measures Project Supervising Stage Impacts and/or Implementing Agency Issues Company Public  Several rounds of wide public EIA institutes, PPMO, city consultations consultations have been PPTA and county conducted on environmental consultants, EPBs, ADB issues, poverty, and resettlement IAs during feasibility studies, and EIAs and IEE preparations.

2. Design Stage Updating EMP  Mitigation measures defined in EIA institutes, PPMO, city each individual EMP will be Design and county reviewed, updated and Institutes, EPBs incorporated into the detailed PPTA design to minimize adverse consultants, environmental impacts. IAs

3. Biding and Bidding  Environmental section and IAs, PPMO, ADB Construction documents and provisions will be included in the procurement Preparation contractors’ bidding documents. agency qualifications  Environmental clauses for contractors in reference to the EMP and monitoring plan will be included in the construction and supply contracts.  The domestic EIA report, IEE report, and EMP will be included in the contract documents

Environmental  Contractors will be required to Contractors IAs, PPMO, operation and prepare an environmental city and supervision operation and supervision county EPBs manual manual, for approval by the IA.

Complaint and  Establish a complaint and Contractors IAs, PPMO, information information office or appoint a city and office or responsible person before starting county EPBs appointed construction. person  Ensure that staff at the office is well trained to handle conflicts with residents from environmental impacts.

Environmental  Environmental specialists and/or SPEPD, SC protection officials from SPEPD will be PPMO, EMC training invited to provide training on implementation and supervision of environmental mitigation measures to relevant persons, especially construction engineers and managers.

Taking of land  Establish a resettlement office IAs PPMO and property comprising local government officials to manage the resettlement process.  Conduct information dissemination and community consultation programs in accordance with the PRC Land Administration Law and ADB

42 Appendix 2 43

Impact Factor/ Potential Mitigation Measures Project Supervising Stage Impacts and/or Implementing Agency Issues Company Policy on Involuntary Resettlement.  Ensure that all resettlement activities are reasonably completed before construction starts on any subproject.

Engagement of  Prior to start of construction, a PPMO, a SC, ADB EMC national environmental national management consultant will be procurement engaged. specialist

Engagement of  Prior to start of construction, IEMs IAs PPMO, city IEMs will be engaged. and county EPBs B. Construction Phase 1. Soil Erosion Excavation  Strip and stockpile topsoil, build Contractors IAs, OEEs, retaining walls where necessary IEMs, PPMO before dumping.  Provide temporary detention ponds or containment to control silt runoff.  Construct intercepting ditches and chutes to prevent outside runoff entering disposal sites, and divert runoff from sites to existing drainage or ponds.

Transport and  All soils will be used as refill and Contractors IAs, OEEs, disposal of soils landscaping materials on site. IEMs, PPMO  Settling ponds will be built in construction sites. Soils in settling ponds will be cleared for use as refill materials.

Construction  Straws or cloths will be laid at the Contractors IAs, OEEs, vehicles entry/exist of each construction IEMs, PPMO site.  Tires of construction vehicles will be cleansed regularly of soils.

Exposed  As soon as refill and land leveling Contractors IAs, OEEs, surfaces is done, re-vegetation with trees IEMs, PPMO and grasses will be undertaken. 2. Water Quality / Siltation in  If mitigation measures are Contractors IAs, OEEs, Dredging works water bodies effectively implemented, siltation IEM, PPMO due to dredging in water bodies will be minimal.

Wastewater  All construction camps are located Contractors IAs, OEEs, from in the urban area, and therefore IEMs, PPMO, construction wastewater from construction city and camps camps will be diverted to county EPBs municipal sewers.  Unauthorized dumping of wastewater will be prohibited.

43 Appendix 2 44

Impact Factor/ Potential Mitigation Measures Project Supervising Stage Impacts and/or Implementing Agency Issues Company Reduction in  Ensure communication of timing Contractors IAs, OEEs, water flows of works, and schedule works IEMs, PPMO, during during non-irrigation season city and construction where possible. county EPBs works

3. Air Quality Dust from  Vehicles delivering granular Contractors IAs, OEEs, material and/or fine materials to the sites IEMs, PPMO, delivery and must be covered. city anc construction county EPBs vehicles

Dust from  Materials storage sites must be Contractors IAs, OEEs, construction 300 m from residential areas and IEMs, PPMO, sites covered or sprayed with water. city and  Extra care will be paid during dry, county EPBs strong windy days.  Water will be sprayed on construction sites twice a day in the dry days.  Upon completion of civil works, all construction sites will be required to be re-vegetated with trees and grasses.

Dust from  All roads and pavements used by Contractors IAs, OEEs, construction vehicles of the contractors or IEMs, PPMO, roads suppliers will be kept clean and city and clear of all dust, mud, or county EPBs extraneous materials dropped by their construction vehicles. Such cleaning must be completed on a regular basis.  Water will be sprayed on access roads twice a day.

Emissions from  Vehicle emissions will comply with Contractors IAs, OEEs, vehicles and GB18352-2005, GB17691-2005, IEMs, PPMO, equipment GB 11340-2005, GB3847-2005, city anc and GB18285-2005. county EPBs  Equipment and machinery emissions must comply with GB16297-1996.  A regular inspection and certification system will be initiated.

4. Noise Noise from  Noise from equipment and Contractors IAs, OEEs, equipment and machinery will comply with IEMs, PPMO, vehicles GB12523-1990. city and  Provide adequate route for large county EPBs

44 Appendix 2 45

Impact Factor/ Potential Mitigation Measures Project Supervising Stage Impacts and/or Implementing Agency Issues Company trucks to keep away from residential areas.  At construction sites within 500 m of the nearest habitation, noisy construction work will be stopped between 22:00 and 06:00 hours.

Demolition  House demolition at construction Contractors IAs, OEEs, sites will be required to stop IEMs, PPMO, between 22:00 and 06:30. city and county EPBs Community  Interviews with residents living Contractors IAs, OEEs, complaints adjacent to construction sites will IEMs, PPMO, about noise be conducted on a weekly basis city and to identify community complaints county EPBs about noise, and seek suggestions from community members to reduce noise annoyance.  Community suggestions will be used to adjust work hours of noise-generating machinery.

5. Solid Wastes Domestic waste  Multi-compartment collection bins Contractors IAs, OEEs, from will be provided to facilitate reuse, IEMs, PPMO, construction recycling and composting of solid city and camps waste. county EPBs  Wastes will be stored away from water bodies and will be regularly collected by the city sanitation bureau and hauled to the municipal sanitary landfill.

Dredged sludge  Dredged sludge will be processed Contractors IAs, OEEs, at reservoir and used for local landscaping. IEMs, PPMO, city and county EPBs

Construction  Professional demolition Contractors IAs, OEEs, solid wastes companies will be contracted to IEMs, PPMO, carry out housing demolition. city and Reusable and recyclable county EPBs materials (such as bricks, windows and doors, steel bars) will be collected for reuse and recycle. Remaining construction wastes will be transported to the municipal landfill.

6. Impact on Flora Vegetation  Preserve existing vegetation Contractors IAs, OEEs, where no construction activity is IEMs, PPMO, planned or temporarily to preserve city and

45 Appendix 2 46

Impact Factor/ Potential Mitigation Measures Project Supervising Stage Impacts and/or Implementing Agency Issues Company vegetation where activity is county EPBs planned for a later date.  Rehabilitate disposal and borrow sites into grassland, woodland, or farmland after closing.

7. Social and Cultural Resettlement  All affected persons will be IAs Local SCs, Considerations compensated and resettled in a PPMO timely and adequate manner, in accordance with the resettlement plans.

Traffic jam or  Build interim roads. Contractors, OEEs, IEMs, block  Select transport routes to reduce IAs PPMO, city disturbance to regular traffic. and county  Divert traffic at peak traffic hours, traffic and reinstating the area to its bureaus original condition on completion of construction.

Cultural  Cultural heritage sites will be Contractors, OEEs, IEMs, heritage preserved where identified. In IAs PPMO, accordance with the PRC provincial regulations, no person shall Cultural destroy, damage, deface, Heritage conceal, or otherwise interfere Department, with a relic. city and  If an important site is unearthed, county work should be stopped cultural immediately and the matter heritage promptly referred to the County, bureaus municipal, provincial or state level agencies for evaluation and decision on appropriate actions.

C. Due Diligence of Ongoing Activities 1. Due Diligence Non-  Undertake due diligence reviews IAs, IEMs, PPMO, city compliance of EIA documents and field EMC and county with EMP and inspections of ongoing works. EPBs EIA requirements during construction works D. Operation Phase 1. Soil Erosion Rehabilitated  Regular inspections will be IAs City and sites undertaken to ensure proper county WRBs maintenance of drainage and EPBs structures and re-vegetated areas in accordance with requirements of soil erosion prevention plan.  Maintenance of road slopes, cuts and embankments—such as watering, fertilizing, pest control and re-planting—will be carried out regularly during road

46 Appendix 2 47

Impact Factor/ Potential Mitigation Measures Project Supervising Stage Impacts and/or Implementing Agency Issues Company operation.  Maintenance will be budgeted as part of regular infrastructure maintenance programs.  Regular monitoring of erosion prevention and control measures will be undertaken by city and county WRBs and EPBs.

2. Water Quality Wastewater  Wastewater from management IAs City and from offices will be directly discharged county EPBs management to municipal sewers that will go to and WRBs office the municipal WWTP (if possible) or to landscape water body.  In cases where connection with municipal sewers is not available, septic tank or on-site wastewater treatment facility will be installed for treating wastewater before being discharged into receiving water bodies.

Reservoir water  Under the project, (i) watershed International PPMO quality management measures to and national improve reservoir water quality consultants and reduce sedimentation will be identified, and (ii) feasibility of eco-compensation for watershed management will be assessed.

3. Water flows Reduced or  Ensure safe release of water to IAs, City and increased water avoid flooding downstream. international county EPBs flows during dry  Environmental flows and flood and national and WRBs, and rainy control requirements for a model consultants PPMO seasons river basin will be determined as part of the associated TA and, during dry season, environmental flows will be maintained at the same as or higher than current flows.

4. Flora Vegetation  All vegetation covers will be IAs City and properly maintained. county EPBs  All slope stabilization sites will be and WRBs inspected regularly.  If signs of failure are discovered, repair will be immediately initiated.

5. Environmental Insufficient  Conduct training for EMC, IAs PPMO management environmental environmental management. management  Refine and maintain a grievance capacity redress mechanism.

ADB = Asian Development Bank, DRC = development and reform committee, EIA = environmental impact assessment, EMC = environmental management consultant, EMP = environmental management plan, EPB = Environmental Protection Bureau, GB = Guo Biao (National Standards), IEM = independent environmental monitor, m = meter, OEE = onsite environmental engineer, IA = implementing agency, PPMO = provincial project management office, PPTA = project preparatory technical assistance, PRC = People’s Republic of China, IEE = initial environmental examination, SC = steering committee, SPDRC = Shandong provincial Development and Reform Committee, SPEPD = Shandong provincial

47 Appendix 2 48

Environmental Protection Department, SPWRD = Shandong provincial Water Resources Department, WRB = Water Resources Bureau, WWTP = wastewater treatment plant. Sources: Domestic EIA reports, and consultations with city and county EPBs.

C. Environmental Monitoring and Inspection

An environmental monitoring program is presented in Table A2.2. This program considers the scope of monitoring, environmental media, monitoring parameters, time and frequency, implementing and supervising agencies. The monitoring will follow the methodology provided in the national standard methods for monitoring pollutants. Other associated standards are national environmental quality standards and pollutant discharge/emission standards.

Internal Monitoring and Inspection. The PPMO will nominate at least one qualified full-time environmental management staff member to undertake environmental management and monitoring activities. The PPMO will further engage a national environmental management consultant (EMC) to assist itself and IAs including local project management offices (LPMOs) in carrying out internal monitoring and inspection, reporting to ADB through quarterly project progress reports, semi-annual environmental monitoring reports, and a project completion report, and conducting necessary training. The PPMO and IAs, with assistance from the EMC, will conduct internal monitoring and inspection on the progress of the EMP, information on project implementation, the environmental performance of the contractors, and environmental compliance, considering reports submitted by contractors, environmental monitoring stations (EMSs), environmental institutes, and independent environmental monitors (IEMs).

Compliance Monitoring and Inspection. EMS at the municipal level will be responsible to undertake regular and random compliance monitoring and inspection before, during, and after construction, as well as in the event of emergencies. If abnormalities are found, the EPB will impose a fine and issue a notice of rectification with a specific deadline.

Environmental Acceptance Monitoring and Audit. Moreover, within 3 months after each subproject completion, or no later than 1 year with permission from the responsible environmental authorities, environmental acceptance monitoring and audit reports will be (i) prepared by qualified environmental institutes in accordance with the Guideline on Project Completion Environmental Audit (2001) of the Ministry of Environmental Protection; (ii) reviewed for approval by environmental authorities who has given the approval to the same individual EIA, and (iii) finally reported to the Asian Development Bank (ADB) through quarterly project progress reports and/or project completion report.

Independent Environmental Monitoring. Local environmental monitoring agencies and/or companies will be engaged by IAs as IEMs. Each IEM will include an environmental safeguard specialist to conduct independent environmental monitoring. The independent environmental monitoring will be conducted to ensure that contractors appropriately implement mitigation measures. The results of the environmental monitoring will form part of quarterly project progress reports, semi-annual environmental monitoring reports, and a project completion report that will be submitted to the ADB. IEMs will assist SPG including the PPMO in reporting to ADB the project progress on environmental issues through quarterly project progress reports, semi-annual environmental monitoring reports, and a project completion report.

Results of the all monitoring mentioned above will be used to evaluate: (i) the extent and severity of environmental impacts compared with the predicted impacts, (ii) performance of the environmental protection measures or compliance with related rules and regulations, (iii) trends of impacts, and (iv) overall effectiveness of the EMP. Effectiveness of mitigation measures and monitoring plans will be evaluated through a feedback reporting system. Modification of measures required by the EMP will be performed, if necessary. The PPMO and city and county EPBs play critical roles in this feedback and adjustment mechanism as shown in Figure A1.

The environmental monitoring program is included in Table A2.2. The cost estimates for the environmental monitoring program are shown in Table A2.7. Before implementing the monitoring plan, responsible agencies will provide more accurate estimates of the costs and present a further detailed

48 Appendix 2 49 breakdown of the cost estimates. During project implementation, the costs will be adjusted based on actual requirements.

Table A2.2: Environmental Monitoring Program Item Parameters Location Time and Implementing Supervising Frequency Agency Agency A. Internal Monitoring and Inspection 1. Progress on Follow All sites Quarterly PPMO, IAs, SC, SPEPD, EMP parameters set EMC ADB 2. Project for compliance Implementation monitoring and 3. Environmental inspection, Performance of environmental Contractors acceptance monitoring and 4. Environmental audit, Compliance independent Monitoring environmental monitoring B. Compliance Monitoring

1. Surface Water pH, NH3-N, TN, For each component, 3 samples each EMSs IAs, city and TP, BOD, COD, minimum 2 locations time, at beginning of county EPBs oils on the river upstream construction and and downstream the quarterly thereafter construction site 2. Air TSP, PM10 2 monitoring locations 3 samples at each EMSs IAs, city and for each construction location each time, county EPBs site semi-annually

3. Noise Leq (dB(A)) 1 location at the Twice (day-time and EMSs IAs, city and border with night-time) each county EPBs settlements within time, monthly during 200 m of construction peak construction, site quarterly otherwise

C. Project Completion Environmental Audit

1. Surface Water pH, NH3-N, TN, For each component, 3 samples each Licensed IAs, city and TP, BOD, COD, minimum 2 locations time, at beginning of environmental county EPBs oils on the river upstream construction and Institutes (use and downstream the quarterly thereafter data from EMSs) construction site 2. Soil and Re-vegetation, All component sites Visual inspection Licensed IAs, city and Vegetation landscaping environmental county EPBs Institutes 3. Dredged Reuse of Sludge Reservoirs Visual inspection Licensed IAs, city and Sludge for Region environmental county EPBs Landscaping Institutes D. Independent Environmental Monitoring 1. Mitigation Mitigation All sites Semi-annually IEMs IAs, city and Measures by measures to be county EPBs Contractors implemented by contractors (listed in Table A2.1) BOD = biochemical oxygen demand, COD = chemical oxygen demand, dB(A) = A-weighted decibel, EMC = environmental management company/consultant, EMP = environmental management plan, EMS = Environmental Monitoring Station at the city level, EPB = Environmental Protection Bureau, IEM = independent environmental monitor, IA = implementing agency, Leq = equivalent continuous noise level, m = meter, NH3-N = ammonia nitrogen, pH = measure of acidity and alkalinity, PM10

49 Appendix 2 50

= particulate matter smaller than 10 micrometers, PPMO = provincial project management office, SPEPD = Shandon provincial Environmental Protection Department, TN = total nitrogen, TP = total phosphor, TSP = total suspended particulates. Source(s): Domestic EIAs, and consultations with PPMO, city and county EPBs, and IAs.

D. Public Consultation

1. Public Consultation during Project Preparation

Various public consultations were conducted in the course of the preparation of the feasibility study reports and EIAs. During the feasibility study reports preparation, the respective municipal governments were consulted to assist in site and process selections. During EIAs preparation and project preparatory technical assistance, public consultations with various groups of stakeholders were conducted. The main focuses of public consultations were to assess the environmental impacts of the proposed subprojects on nearby residents and mitigation measures, as well as resettlement issues. These activities were carried out in accordance with Interim Guidelines on Public Participation in Environmental Impact Assessment (2006) of the Ministry of Environmental Protection, and ADB Environmental Assessment Guideline (2003). Grievance redress mechanism has been also discussed with people who might be affected during project preparation, through several rounds of public consultations with various stake holders groups.

2. Future Public Consultation Plan

Future plans for public involvement during the design, construction, and operation phases were developed during the project preparation. These plans include public participation in (i) monitoring impacts and mitigation measures during the construction and operation stages, (ii) evaluating environmental and economic benefits and social impacts, and (iii) interviewing the public after the project is completed. They include several types of consultations, e.g., site visits, workshops, investigation of specific issues, interviews, and public hearings (Table A2.3).

Public participation plans are part of the project implementation and management plan. The IA is responsible for public participation during project implementation. The IA will also establish an environmental management unit (EMU) for supervising implementation, continuing public consultation, monitoring progress, and responding to grievances. The staff at the offices will be well trained to handle crisis situations or conflicts with residents due to distress from environmental impacts. Costs for public participation activities during project construction are included in the project funding. The costs are estimated as CNY3,000 for each expert workshop, CNY10,000 for each resettlement survey, CNY5,000 for each public workshop, and CNY6,000 for each press conference. Costs for public participation activities during operation will be covered by the IA. In addition, the established feedback mechanisms (Figure A1) will ensure timely feedback and measures to address any concerns raised by the project affected communities.

Table A2.3: Public Consultation Program Organizer Approach / Times Subjects Participants 1. Project Preparation PPMO, IAs, Design  EIA public opinion surveys: once Priority, design, PPMO, IAs, Design Institutes, EIA for each subproject environmental benefits and Institutes, EIA institutes, RP  Socioeconomic and AP surveys impacts, social benefits and institutes, RP institutes, city and  Public consultation meeting and impacts, mitigation institutes city and county EPBs questionnaire: once for overall measures, attitudes toward county EPBs, other project subproject project, and provincial, municipal,  Site visits: multiple times suggestions city, and county government stakeholders, community representatives

50 Appendix 2 51

Organizer Approach / Times Subjects Participants 2. Construction PPMO, IAs, EMC,  Public consultation and site visits: Adjusting mitigation Residents within IEMs at least once a year measures if necessary, construction construction impacts, area comments and suggestions  Public information session: at least Adjusting mitigation Representatives of once a year measures if necessary, residents and social construction impacts, sectors comments and suggestions  Survey on resettlement: as Comments and suggestions People affected by required per RPs land acquisition and resettlement 3. Test Operation PPMO, IAs, EMC,  Questionnaire survey: at least Comments and suggestions Local residents and IEMs once during test operation on operational impacts, social sectors, city  Site visits: multiple, depending on public suggestions on and county EPBs results of project completion corrective actions environmental audit 4. Operation PPMO, IAs  Site visits: once every 6 months by Plant operational Plant managers and IEMs and PPMO performance, informal workers, local interviews with local residents adjacent to residents plant

 Expert workshop or press Expert comments and Experts from conference: as needed based on suggestions on corrective residents, social public consultation and workshop measures sectors, media

AP = affected person, EIA = environmental impact assessment, EMC = environmental management consultant, EPB = environmental protection bureau, IEM = independent environmental monitor, IA = implementing agency, PPMO = provincial project management office, RP = resettlement plan.. SPEPD = Shandong Environmental Protection Department. Source(s): Domestic EIAs, and consultations with PPMO, SPEPD, city and county EPBs, and IAs.

E. Responsibilities and Authorities for Implementation

The Shandong Government is the executing agency (EA) and has established a steering committee(SC) headed by the Vice Governor. The PPMO is co-located in the Shandong provincial Water Resources Department (SPWRD) headed by the Director General of SPWRD. The PPMO draws its members from Shandong Provincial Development and Reform Committee (SPDRC), Shandong provincial Finance Department (SPFD), and SPWRD. Delegated by the EA, the PPMO will have overall responsibility for supervising the implementation of mitigation measures and reporting to ADB. The PPMO will be also responsible for replying to petitions and/or complaints from affected persons, if such petitions and/or complains are appealed to the PPMO.

The PPMO, IAs, and contractors will each nominate dedicated, trained, and qualified environment specialists to undertake environmental management activities and ensure effective EMP implementation. Project management consultants engaged by the PPMO including EMC will assist the EA/PPMO and IAs in preparing quarterly project progress reports and carrying out training programs. Table A2.4 shows the environmental responsibilities in different phases of the project.

The IAs will be largely responsible for environmental management and implementation of mitigation measures. The IAs will ensure that the EMP is carried out. The IAs will also engage design institutes, EAI institutes, and IEMs to help with environmental management at the preparation, design, construction, and operation phases. The IAs will be responsible for arranging environmental monitoring reviews and responding to any adverse impacts beyond those foreseen in the EIAs. The IAs will also address requests for mitigation measures from city and county EPBs and ADB. If affected persons appeal

51 Appendix 2 52 petitions and/or complains to an IA, the IA will reply within 30 days, based on consultations with the IEM and other relevant institutes and/or agencies as necessary.

Construction contractors will be responsible for implementing mitigation measures during construction, while the IAs will be responsible for implementing such measures during the operation.

In accordance with the EMP, each IA will set up an environmental management unit (EMU) that will generally require two employees. The EMU will be responsible for: (i) implementing the EMP and developing further implementation details; (ii) supervising contractors’ implementation of mitigation measures during construction; (iii) implementing training programs for contractors; (iv) incorporating environmental management, monitoring, and mitigation measures into construction and operation management plans; (v) developing and implementing internal routine environmental monitoring; (vi) reporting performance of the EMP to the PPMO and responsible agencies; and (vii) assisting the IA in replying to petitions and/or complaints appealed from affected persons, if such petitions and/or complains are appealed to the IA. The EMU will be supported and supervised respectively by the IA, EMC, IEM, and city or county EPB.

City and county EPBs, delegated by SPEPD, will ensure compliance with the PRC and local environmental regulations through regular and random environmental compliance monitoring and inspection during construction and operation. The EMS at the municipal level will conduct environmental compliance monitoring and inspection. On the basis of the environmental compliance monitoring and inspection, the EPB will impose fines and order corrective actions, if necessary.

52 Appendix 2 53

Table A2.4: Environmental Responsibility Matrix Phase Agencies Environmental Responsibilities Preparation Design Institutes Review and select alternatives (technological, design, location, etc.) EIA institutes Prepare EIAs and EMPs for subprojects, including public consultations City and county EPBs Review and approve EIAs, including the EMPs PPTA consultant Prepare IEE including EMP, including public consultations

PPMO Coordinate and supervise EIAs, IEE and public consultations IAs Review and endorse IEE, including the EMP, for posting at ADB website Design Design Institutes Update the EMPs in cooperation with EIA institutes, and incorporate mitigation measures in engineering detail designs and contracts PPMO, IAs Review and approve environmental measures Tendering and PPMO, IAs, Incorporate EMP clauses in bidding documents and contracts Contracting procurement agency Construction IAs Ensure implementation of mitigation measures, and public consultations Contractors Implement mitigation measures PPMO, city and county Advise and supervise implementation of mitigation measures EPBs EMC contracted by Conduct internal monitoring and inspection, and public consultations PPMO IEMs Conduct independent monitoring (including public consultations), and prepare periodic monitoring reports to IAs EMSs Conduct compliance monitoring Test Operation IAs Conduct project completion environmental audit, including sampling and lab tests, and prepare project completion environmental audit report City and county EPBs Review and approve project completion environmental audit report, and order corrective actions if necessary EMC, IEMs Assist IAs in conducting environmental audit and preparing progress reports to the PPMO Operation IAs Ensure proper operation of subproject facilities according to design standards, and implementation of mitigation measures and public consultations IAs, EMC Conduct internal environmental monitoring and inspection, supervise implementation of the EMP, and conduct public consultations IEMs Conduct independent monitoring (including public consultations), and prepare periodic monitoring reports to IAs EMSs on behalf of city Conduct regular and unannounced environmental compliance monitoring and and county EPBs inspection Grievance Contractors, project Tries to resolve a concern arose by affected persons during construction directly Redress managers with the affected persons Mechanism Village committees If petitions and/or complains are submitted to village committees from affected persons, reply to the affected persons within 2 weeks. Township governments, If petitions and/or complains are submitted to township governments and/or subdistrict offices subdistrict offices from affected persons, reply to the affected persons within 2 weeks. IAs If petitions and/or complains are submitted to IAs from affected persons, reply to the affected persons within 30 days PPMO Deal with petitions and/or complains, if such petitions and/or complains are appealed to the PPMO EIA = environmental impact assessment, EMC = environmental management consultant, EMP = environmental management plan, EPB = environmental protection bureaus, IA = implementing agency, IEE = initial environmental examination, IEM = independent environmental monitor, EMS = environmental monitoring station at city or county level, IA = project implementing agency, PPMO = provincial project management office, PPTA = project preparatory technical assistance. Source(s): Domestic EIAs, consultations with PPMO, SPEPD, city and county EPBs, and IAs.

F. Institutional Strengthening and Training

An assessment undertaken during the project preparatory technical assistance indicates that the PPMO has adequate technical and institutional capacities for project implementation. However, the IAs have weak capacity in environmental management and monitoring. For proper implementation of the EMP, it is necessary to strengthen the capacity of the IAs. The proposed training is shown in Table A2.5.

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It is considered that the three-tier implementation arrangement—SC, PPMO, and IAs provide a reasonable framework for project management and control. The definition of roles, responsibilities and relationships between the SC, PPMO, IAs, and other relevant agencies (e.g., SPEPD, city and county EPBs) is adequate to ensure the effective implementation of the project.

Environmental specialists in the PPMO, IAs, and contractors will receive training in environmental management, environmental monitoring and supervision, mitigation planning, emergency response, environmental policymaking, and other environmental management techniques. Funding of this training will be included in the project budget and in the operation and maintenance budget in the operation phase.

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Table A2.5: Institutional Strengthening and Training Activities Target Agencies/ Contents Timing Attendees Strengthening Institutional PPMO, IAs, SPEPD,  Defining institutional arrangements for During project Strengthening city and county environmental management, monitoring, and preparation EPBs supervision  Defining positions and responsibilities  Appointing and recruiting personnel

EMC  Recruiting and contracting EMC for internal Prior to project environmental management consultancy and implementation monitoring

IEMs  Recruiting and contracting IEMs to conduct Prior to project independent environmental monitoring for implementation subprojects

Environmental IAs, procurement  Developing environmental management clauses During project Management agency, EMC and incorporating them into construction and preparation Clauses and operational contracts Protocols  Developing/refining environmental monitoring protocols  Developing environmental emergency response procedures Training Environmental PPMO, IAs,  Environmental laws and regulations Prior to project Laws, contractors  Environmental policies and plans implementation Regulations and  Basic environmental management Policies  Environmental emergency response

EMP PPMO, IAs,  Responsibility and duties for project construction, Prior to and during Implementation contractors management and environmental protection project  Tasks of environmental protection in the project implementation construction  Key environmental protection contents in project construction  EMP improvement and corrective actions

Environmental IAs, contractors  Monitoring and inspection methods, data collection Prior to and during Monitoring, and processing, interpretation of data, reporting project Inspection and system implementation Reporting  Environmental reporting requirements

EMC = environmental management consultant, EMP = environmental management plan, EPB = environmental protection bureau, IA = implementing agency, IEM = independent environmental monitor, PPMO = provincial project management office, SPEPD = Shandong provincial Environmental Protection Department. Source(s): Domestic EIAs, and consultations with PPMO, SPEPD, city and county EPBs, and IAs.

G. Reporting and Supervision

Monthly Construction Reports. During the construction period, contractors will submit monthly construction reports to the IAs. The reports will summarize: (i) environmental issues during construction; (ii) mitigation measures taken, if any; and (iii) consequences of the impacts on the environment and/or surrounding communities.

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The contractors will be trained to take immediate actions to remedy unexpected adverse impacts or ineffective or inefficient mitigation measures, as required by the EMP. IAs will also respond to these reports in order to ensure that the contractors have taken appropriate and timely action. Additional measures may be taken, if needed, to ensure that all issues raised by the reports are appropriately addressed.

The reported environmental issues, mitigation measures, and the impacts will be reported to the PPMO quarterly, and SPEPD and city and county EPBs semi-annually. SPEPD and city and county EPBs may request that further environmental mitigation actions be taken, as they deem necessary, and may determine further mitigation measures for different stages, if necessary.

Compliance Monitoring Reports. On behalf of the IAs, the local EPBs will delegate compliance monitoring to the local EMSs. The EMSs will conduct regular and random environmental monitoring activities before, during, and after construction, as well as in the event of emergencies, according to the PRC environmental regulations. The compliance monitoring reports will include: (i) project background, (ii) construction and operation activities, (iii) environmental conditions, (iv) measurement or sampling taken during auditing and their locations, (v) analytical results, (vi) interpretation and implication of the monitoring results, (vii) determination of the compliance status with regard to applicable regulations and standards, and (viii) recommendations for improvement. These reports will be submitted to the IAs which will forward to SPEPD, city and county EPBs, and the PPMO.

Environmental Acceptance Monitoring and Audit Reports. Within 3 months after each suproject completion, or no later than 1 year with permission from the responsible environmental authorities, environmental acceptance monitoring and audit reports will be prepared by qualified environmental institutes in accordance with the Guideline on Project Completion Environmental Audit (2001) of the Ministry of Environmental Protection. The reports will focus on the project compliance of environmental performance when it is put into the operation. The reports will be sent to environmental authorities for review and approval and also to the PPMO through the IAs. If non-compliance is found, the project will be asked to be improved to the requirements before the official commencement of the operation.

Independent Environmental Monitoring Reports. IEMs will submit independent environmental monitoring reports on a semi annual basis to IAs which will forward to the PPMO, SPEPD, and city and county EPBs. The reports will emphasize: (i) progress made in implementing the EMP, (ii) implementation of mitigation measures, (iii) environmental compliance, (iv) institutional strengthening and training, (v) public consultations, and (vi) problems occurred and corrective actions taken.

Quarterly Project Progress Reports and Project Completion Report. Based on the monthly construction reports, compliance monitoring reports, environmental acceptance monitoring and audit reports, and independent environmental monitoring reports submitted to the PPMO, the PPMO, with assistance from the EMC, will report to ADB on a quarterly basis the progress of the EMP, information on project implementation, and the environmental performance of the contractors, through quarterly project progress reports. In addition, within 3 months of physical completion of the project, the PPMO will submit to ADB a project completion report that describes the achievements in relation to the project's expected impact, outcome, and outputs including environmental terms. ADB may request that further environmental mitigation actions be taken, as they deem necessary, and may determine further mitigation measures for different stages, if necessary.

The environmental reporting plan is presented in Table A2.6.

Table A2.6: Environmental Reporting Plan Reports From To Frequency Construction reports Contractors IAs Monthly

Compliance monitoring reports EMSs IAs (forwarded to As per the PRC regulation PPMO, SPEPD, and city and

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Reports From To Frequency county EPBs)

Independent environmental monitoring reports IEMs IAs (forwarded to Semi-annual PPMO, SPEPD, and city and county EPBs)

Environmental acceptance monitoring and Qualified IAs (forwarded to Within 3 months after each audit reports environmental PPMO, SPEPD, suproject completion, or no institutes and city and later than 1 year with county EPBs) permission from the responsible environmental authorities

Quarterly Project Progress Reports and PPMO, EMC ADB Quarterly and within 3 Project Completion Report months of physical completion of the project ADB = Asian Development Bank, EMC = environmental management consultant, EPB = environmental protection bureau, EMS = environmental monitoring station at city or county level, IEM = independent environmental monitor, IA = implementing agency, PPMO = provincial project management office, PRC = People’s Republic of China, SPEPD = Shandong provincial Environmental Protection Department. Source(s): Domestic EIAs, and consultations with SPMO, SEPD, EPBs and IAs.

H. Work Plan

Before construction, the PPMO and IAs will develop detailed responsibilities and requirements for contractors and will provide detailed cost estimates of mitigation measures and environmental monitoring in the construction contracts. The PPMO and IAs will also detail the responsibilities of their environmental management offices and prepare their work schedules.

Before operation, the IAs will develop detailed work plans for environmental management and monitoring during operation based on the EMP. These work plans will be submitted to city and county EPBs and SPEPD to help them to supervise implementation.

I. Cost Estimates for Environmental Management

The IAs with help from the PPMO will develop detailed plans for procurement of equipment and materials, and civil works for implementing mitigation measures and monitoring plans. Environmental considerations will be incorporated into the bidding documents and contracts to ensure environmentally responsive procurement.

Cost estimates for mitigation measures, environmental monitoring, and environmental administration are summarized in Table A2.7. Before implementing a monitoring plan, responsible agencies will present a more detailed breakdown of the estimated budget. During project implementation, the budgets will be adjusted based on actual requirements. Contractors will bear the costs for all mitigation measures during construction, which will be included in the bidding documents and contracts. The IAs will bear costs related to mitigation measures during operation. Costs related to environmental supervision during construction and operation will be borne by the IAs. Costs for capacity building will be borne by the project as a whole. During the operation phase, the training costs will be included in the operation and maintenance budget.

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Table A2.7: Cost Estimates for EMP Total of Mitigation Environmental Environmental subproject Measures Monitoring Administration (CNY) (CNY) (CNY) (CNY) Qianghuang Reservoir 467,000 179,000 114,000 174,000 Renhe Reservoir 490,000 233,000 154,000 103,000 Shizuizi Reservoir 136,000 41,000 55,000 40,000 Songshan Reservoir 228,000 95,000 95,000 38,000 Longwantao Reservoir 82,000 39,000 29,000 14,000 Anjing Reservoir 97,000 35,000 29,000 33,400 Yangzhuang Reservoir 84,000 37,000 30,000 17,000 Huacun Reservoir 82,000 36,300 27,000 19,000 Muyu Reservoir 476,000 214,000 167,000 95,000

Total of the project 2,142,000 909,000 700,000 533,000 CNY = Chinese yuan

J. Mechanism for Feedback and Adjustment

Based on environmental reports, environmental authorities will decide whether: (i) further mitigation measures are required as corrective action, or (ii) some improvement is required to environmental management practices. If it is found during inspection that there has been substantial deviation from the EMP or any changes made to the project or any subprojects which may cause substantial adverse environmental impacts or increase the number of affected people, then PPMO should consult with environmental authorities and ADB immediately and form an environmental assessment team to conduct additional environmental assessment and, if necessary, further public consultation. The revised EIA reports including EMPs should be submitted to the environmental authorities for approval, and finally report to ADB. The revised EMPs will be passed to the contractor(s) and IAs for implementation.

K. Grievance Redress Mechanism

Public participation, consultation and information disclosure undertaken as part of the local EIA process, assessment and development of resettlement plans, and consultations undertaken by the project consultants have discussed and addressed major community concerns. Continue public participation and consultation has been emphasised as a key component of successful project implementation. As a result of this public participation and safeguard assessment during the initial stages of the project, major issues of grievance are not expected. However, unforeseen issues may occur. In order to settle such issues effectively, an effective and transparent channel for lodging complaints and grievances has been established, in parallel with the mechanism developed under the resettlement planning process (refer to subproject resettlement plans).

In the event of a grievance issue, the basic stages established for redress are:

(i) Stage 1: If a concern arises during construction, the affected person tries to resolve the issue of concern directly with the contractor and the project manager. If successful, no further follow-up is required.

(ii) Stage 2: If not successful, the affected person can submit an oral or written petition/complaint to the village committee.13 For an oral complaint, the village committee must make written records properly. The village committee must give a clear reply within 2 weeks. The IEM will assist the village committee in replying to the affected person.

13 In the 7 project counties, there are 5,694 villages. The village committees are fully aware of their responsibilities and course of action.

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(iii) Stage 3: If the affected person is not satisfied with the reply in Stage 2, he/she can appeal to the township government14 after receiving the reply in Stage 1 and the township government must give a clear reply within 2 weeks. The IEM will assist the township government in replying to the affected person.

(iv) Stage 4: If the affected person is still not satisfied with the reply of township government, he can appeal to the IA. The IA, through the LPMO and PPMO, must report to the ADB project officer as soon as the complaint is recorded, by submitting relevant documents. The IA, through the EMU established in the IA, must prepare a clear reply in consultation with the EPB, EMC, and IEM, and give it to the affected person within 30 days.

(v) Stage 5: If the affected person is still not satisfied with the reply of the IA, he/she can appeal to the PPMO after receiving the reply of Stage 4. The PPMO must report to ADB as soon as the complaint is recorded by submitting relevant documents, and prepare a clear reply in consultation with ADB, SPERD, EMUs, EMC, and IEMs. The PPMO must give the reply to the affected person within 30 days. ADB project team will assess the situation, contact the affected people and Government project counterparts and design and implement the course of actions. Stages (ii)-(v) will be further refined during the detailed design stage.

In addition to the established project specific channel above, ADB's overall accountability mechanism (2003) applies15. The mechanism provide opportunities for people adversely affected by ADB-financed projects to express their grievances; seek solutions; and report alleged violations of ADB’s operational policies and procedures, including safeguard policies. ADB’s accountability mechanism comprises two separate, but related, functions: (i) consultation, led by ADB’s special project facilitator, to assist people adversely affected by ADB-assisted projects in finding solutions to their problems; and (ii) providing a process through which those affected by projects can file requests for compliance review by ADB’s Compliance Review Panel.

14 In the 7 project counties, there are 94 townships including 15 sub-districts and 7 towns. 15 The accountability mechanism replaced ADB’s Inspection Function (1995).

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Figure A1: Mechanism for Feedback and Adjustment

SC ADB

City and county PPMO EPBs/SPEPD

Consultants (DIs/EMC)

IAs

IEMs

EMSs Contractors (During Construction)

Implementation of Mitigation Measures, Monitoring Program and Public Reporting Consultation Plan

Supervision

Documentation of EMP Implementation and Performance/Information Flow

Action

ADB = Asian Development Bank, DI = design institute, EMC = environmental management consultant, EMS = Environmental Monitoring Station at the city and county level, EPB = Environmental Protection Bureau, IA = implementing agency, IEM = independent environmental monitor, PPMO = provincial project management office, SC = steering committee, SPEPD = Shandong provincial Environmental Protection Department Source(s): Feasibility study reports, domestic EIAs, and consultations with PPMO, SPEPD, city and county EPBs, and IAs.

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