AFRICAN DEVELOPMENT BANK EXECUTIVE SUMMARY Of SOUTH AFRICA: ENVIRONMENTAL IMPACT ASSESSMENT FOR THE MEDUPI POWER PLANT PROJECT OF ESKOM 1 July 2009 Table of Contents Page No. 1. Introduction 3 2. Project description 3 3. Policy legal and administrative framework 4 4. The need and justification of the project 5 5. Project Alternatives 6 6. Description of the Project Environment 7 7. Potential Impacts and Mitigation Measures 10 8. Public Consultations and Disclosure 15 9. Environmental management and monitoring plans 16 10. Environmental enhancement & Complementary Initiatives 18 11. Conclusion 20 12. References 20 2 1. Introduction In order to meet the objectives as set out in the South African Energy Policy as well as to meet developmental and socio-economic objectives in South Africa, the country needs to optimally use the available energy resources. Eskom is required to respond to the longer term growing electricity demand of approximately 3% per annum. The construction of a Medupi coal-fired power station in the Lephalale (previously Ellisras) area was identified as the most favored feasible option for the first new power station, that is proposed to operate at an installed capacity of approximately 4,800 MW. The following presents a summary of the ESIA of the MEDUPI power station project. Its contents include: i) Project Description, (ii) Policy Legal and Administrative framework, (iii) The need and justification of the Project, (iv) Project Alternatives, (v) Description of the Project Environment, (vi) Potential Impacts and Mitigation, (vii) Public Consultations and Disclosure, (viii) Environmental & Social Management and Monitoring plans (ix) Environmental Enhancement & Complementary Initiatives, (x) Conclusion and (xi) References. 2. Project Description The Power Station is proposed to ultimately have a maximum installed capacity of up to 4800 MW (6 x 800 MW units). The power plant and associated plant (terrace area) would require an area of approximately 700 ha, and an additional estimated 500 - 1000 ha would be required for ancillary services, including ash disposal facilities (alternate ash disposal options are, however, currently being investigated). The proposed power station will utilize a range of technologies pertaining to cooling, combustion and pollution abatement. The proposed power station will be a dry-cooled station. The use of dry-cooled technology is necessitated as a result of South Africa being a water scarce country and limited water availability in the area. The power station would be a zero liquid effluent discharge station, particulate emissions will be less than 50mg/Sm3 and due to the relatively low sulphur content of the coal and local air quality sulfur dioxide emissions will not have a significant impact on health. The plant will be Flue Gas Desulphurization (FGD) ready, a decision and timing for retrofitting the power station with FGD will be based on ambient air quality monitoring results, South African regulations including proposed emission limits and water availability. The power station will source coal from the local coalfields, and it would be delivered to the power station via conveyor belts. The coal to Medupi will be supplied through a brownfields expansion of Grootegeluk mine with mining from the existing opencast pit continuing at an accelerated rate. The coal beneficiation process will be handled via two new dense medium facilities (Grootegeluk 7 and Grootegeluk 8 beneficiation plants) which will be constructed at the mine. The Environmental Impact Assessment for the coal mine and transmission lines have been completed in separate EIA processes1. 1 The ESIA for the Transmission lines (not part of the project) is a separate process and has been completed and received the approval of the Department of Environment and Tourism (DEAT). 3 All Eskom's existing operational coal-fired power stations utilize pulverized fuel technology (PF). The specific technology employed in the Medupi power plant would be super critical boilers which would heat water to produce steam within a pressure and temperature range of 24-30 MPa and 5380C – 6000C respectively. The plant will be dry cooled and installed with low NOx burners and pulse jet fabric filters. The proposed power station would be similar to the existing Matimba Power Station in terms of operation, design and dimensions. The power station structure would be approximately 130 m high and approximately 500 m wide. The required stacks would be approximately 220 m in height. Direct-cooling technology will be applied; hence no cooling towers will be constructed. Other related infrastructure would include a coal stockpile, conveyor belts, and an ash dump, with infrastructure such as transmission lines being planned to integrate the station into the national electricity grid. Annex 1 illustrates the plant location while Annex 2 shows the plant layout. 3. Policy, legal and administrative framework According to AfDB environmental and social assessment procedures, this project is assigned Category 1. The ESIA conforms to the Environmental and Social Assessment Procedures (ESAP, 2001) of the African Development Bank and the World Bank 1998 Pollution Prevention and Abatement Handbook (PPAH, 1998). In terms of the Environmental and Social Impact Assessment (ESIA) Regulations published in terms of the Environment Conservation Act (No 73 of 1989), Eskom Holdings Limited requires authorization from the National Department of Environmental Affairs and Tourism (DEAT) in consultation with the Limpopo Department of Economic Development, Environment and Tourism (LDEDET) for the undertaking of the proposed project. In order to obtain authorization for this project, comprehensive, independent environmental studies have been undertaken in accordance with the ESIA Regulations. An ESIA process for the proposed coal-fired power station and ancillary infrastructure has been undertaken in accordance with the requirements of all relevant South African legislation including inter alia, those of: • Environment Conservation Act (No 73 of 1989); • National Environmental Management Act (No 107 of 1998); • National Water Act (No 36 of 1998); • National Heritage Resources Act (No 25 of 1999); • Occupational Health and Safety Act (No 85 of 93); • Atmospheric Pollution Prevention Act (No 45 of 1965); • National Environmental Management: Air Quality Act 39 of 2004; • White Paper on Energy Policy, GN 3007, 17/12/1998; • South Africa had its Long Term Mitigation Strategy (LTMS) on Climate Change approved by the South African cabinet in 2008; • The March 2009 Climate Change Summit laid the foundation for a participatory process to shape the way South Africans respond to climate change following; • The South African government has started drafting its policy framework for climate change; 4 • White Paper on Integrated Pollution and Waste Management for South Africa (January 2000); and • National Waste Management Strategy documents (October 1999). It is noted that Provisional ambient air quality limits for South Africa were published in Schedule 2 of the National Environmental Management: Air Quality Act. Draft ambient air quality standards which will replace the provisional limits were published for public comment in March 2009, and should be legislated later in 2009. South African ambient air quality limits are similar to those in the EU and the WHO Guidelines The environmental studies (Ref 1,2, and 3)followed a two-phased approach in accordance with the ESIA Regulations published in terms of the Environment Conservation Act (No 73 of 1989) i.e.: • Phase 1: Environmental Scoping Study • Phase 2: Environmental Impact Assessment (EIA) No fatal flaws were identified since the impacts can be mitigated to acceptable levels. The DEAT has granted to Eskom the Record of Decision (ROD) which is like an environmental permit. 4. The Need and Justification for the Proposed Project Policy Considerations and Strategic Planning The South African Energy Policy, published in December 1998 by the Department of Minerals and Energy (DME) identifies five key objectives, namely: • Increasing access to affordable energy services; • Improving energy sector governance; • Stimulating economic development; • Managing energy-related environmental impacts; and • Securing supply through diversity. In order to meet these objectives and the developmental and socio-economic objectives in South Africa, the country needs to optimally use the available energy resources. The South African Government, through the Department of Minerals and Energy (DME), the National Electricity Regulator (NER) and Eskom are required to address what can be done to meet these electricity needs both in the short- and long- term. Growth in electricity demand and reduction in surplus capacity The demand for electricity in South Africa has grown, on average, at more than 4% up until 2008, with a concomitant reduction in the surplus generating capacity. The DME, NERSA and Eskom planning processes all indicate that South Africa will require an additional 5 000 MW of electricity within the next 5 years, with this consisting of both base load electricity generating capacity and peaking electricity generating capacity. The processes also indicate that new base load capacity will be required by approximately 2010. In 2004, the South African Cabinet took the decision that Eskom will build approximately 70% of the new capacity required in South Africa. The balance is expected to come from Independent Power Producers (IPPs). 5 For base load capacity,