Initial Environmental Examination October 2012 MFF 0021-PAK: Power Distribution Enhancement Investment Program – Proposed Tranche 3 Prepared by the Multan Electric Power Company for the Asian Development Bank. Draft Initial Environmental Examination (IEE) Report Loan-Pak {October-2012} Islamic Republic of Pakistan: Power Distribution Enhancement Investment Program (Multi Tranche Financing Facility) Tranche-III: Augmentation of MEPCO Sub-Projects Prepared by: Multan Electric Power Company (MEPCO) Government of Pakistan The Initial Environmental Examination (IEE) Report is a document of the borrower. The views expressed herein do not necessarily represent those of ADB‟s Board of Directors, management, or staff, and may be preliminary in nature. TABLE OF CONTENTS 1. INTRODUCTION 1 1.1 Overview 1 1.2 Requirements for Environmental Assessment 1 1.3 Scope of the IEE Study and Personnel 4 1.4 Policy and Statutory Requirements in Pakistan 4 1.5 National Environmental Quality Standards 5 1.6 Structure of Report 5 2. DESCRIPTION OF THE PROJECT 6 2.1 Type of Project 6 2.2 Categorization of the Project 7 2.3 Need for the Project 7 2.4 Location and Scale of Project 7 2.5 MEPCO Subprojects 7 3. DESCRIPTION OF THE ENVIRONMENT 11 3.1 Sub-project Areas 11 3.2 Physical Resources 11 3.2.1 Topography, Geography, Geology, and Soils 11 3.2.2 Climate and Hydrology 11 3.2.3 Groundwater and Water Supply Resources 11 3.2.4 Surface Water Resources 12 3.2.5 Air Quality 12 3.2.6 Noise and Vibration 13 3.3 Ecological Resources 13 3.4 Economic Development 13 3.5 Social and Cultural Resources 14 3.5.1 Administrative Setup 14 3.5.2 Population and Communities 14 3.5.3 Education and Literacy 15 3.5.4 Health Facilities 15 4. SCREENING OF POTENTIAL ENVIRONMENTAL IMPACTS AND MITIGATION MEASURES 16 4.1 Project Location 16 4.2 General Approach to Mitigation 16 4.3 Prevention of Ground Contamination 16 ii 4.4 Cultural Heritage, Temples, Religious Sites & Social Infrastructure 17 4.5 Potential Environmental Impacts in Construction 17 4.5.1 Encroachment, Landscape and Physical Disfiguration 17 4.5.2 Cut and Fill and Waste Disposal 17 4.5.3 Trees, Ecology and Protected Areas 18 4.5.4 Hydrology, Sedimentation, Soil Erosion 18 4.5.5 Air Pollution from Rock Crushing, Cut, Fill, & Asphalt 19 4.5.6 Noise, Vibration and Blasting 19 4.5.7 Sanitation, Solid Waste Disposal, Communicable Diseases 20 4.6 Potential Environmental Impacts in the Operational Stage 21 4.6.1 Air Pollution and Noise from the Enhanced Operations 21 4.6.1 Pollution from Oily Run-off, Fuel Spills and Dangerous Goods 21 4.7 Enhancement 21 5. INSTITUTIONAL REQUIREMENTS & ENVIRONMENTAL MANAGEMENT PLAN 22 5.1 Institutional Requirements 22 5.2 Pakistan Electric Power Company (PEPCO) 22 5.2.1 Distribution Companies (DISCOs) 22 5.2.2 Technical Assistance (Consultants) 22 5.3 Distribution Companies (DISCOs) 24 5.3.1 Planning & Engineering Directorate 24 5.3.2 Chief Engineer Development 24 5.3.3 Project Director (GSC) 24 5.4 Responsibility for Internal and External Monitoring 24 5.5 Environmental Management Plan 25 5.6 Environmental Monitoring Plan 27 6. PUBLIC CONSULTATION AND INFORMATION DISCLOSURE 1 7. FINDINGS RECOMMENDATIONS AND CONCLUSIONS 4 7.1 Findings and Recommendations 4 7.2 Conclusion 4 Figures Figure 1.1 Pakistan EIA Process Figure 1.2 Letter from Pakistan Federal EPA on EIA Process Figure 2.1 Jurisdiction of MEPCO Figure 2.2 Existing and Proposed Map of Grid Stations & Transmission Lines in MEPCO Figure 5.1 Organizational Set-up for Implementation of Tranche-III Sub-Projects iii Annexures Annex-A Location of Sub-Projects Annex-B Coordinates and Description of the DGS locations Annex-C Environmental Management Plan (Matrix) Annex-D Environmental Monitoring Plan iv ABBREVIATIONS ADB Asian Development Bank BTM Burewala Textile Mills DGS Distribution Grid Substation DISCO Distribution Companies EA Executing Agency EARF Environment Assessment Review Framework EIA Environment Impact Assessment EMP Environmental Management Plan EPA Environmental Protection Agency ESC Environmental & Social Cells ESIC Environmental and Social Impact Cell FEA Framework of Environment Assessment FEPA Federal Environmental Protection Agency GoP Government of Pakistan GSC Grid System Construction GSO Grid System Operation IA Implementation Agency IEE Initial Environment Examination ITC Increase transformer capacity km Kilometer Kv Kilo Volts LAR Land Acquisition & Resettlement MVA Mega Volt Ampere MW Mega Watt MEPCO Multan Electric Power Company Limited MFF Multi-Tranche Finance Facility NEQS National Environmental Quality Standards NGO Non-Governmental Organization NTDC National Transmission and Despatch Company Pak-EPA Pakistan Environmental Protection Agency PA Systems Public Announcement System PC Planning Commission PFR Project Financing Requests PDE Power Distribution Enhancement PDEMFF Power Distribution and Enhancement Multi-tranche Finance Facility PEPCO Pakistan Electric Power Company Private Limited PEPA Pakistan Environmental Protection Act PMU Project Management Unit PIU Project Implementation Unit PIC Project Implementation Consultants REA Rapid Environmental Assessment RP Resettlement Plan S-P Sub-Project SR Sensitive Receivers SPS Safeguard Policy Statement SF6 Sulphur hexafluoride SIEE Summary Initial Environmental Examination TSP Total Suspended particles TSG Technical Services Group TOR Terms of Reference WHO World Health Organization v IEE for Transformer Extension and Augmentation Subprojects, Tranche-III MEPCO 1. INTRODUCTION 1.1 Overview 1. This document is the Initial Environmental Examination (IEE) for the Tranche-III augmentation sub-projects of Multan Electric Power Company (MEPCO). This IEE was prepared under TA Loan 2178-PAK of the Asian Development Bank (ADB) for Power Distribution and Enhancement Multi-Tranche Finance Facility (PDEMFF). The substation and distribution line are taken to be one project. 2. Government of Pakistan (GoP) has requested ADB to provide the PDEMFF to facilitate investments in power distribution and development of electric Infrastructures of eight independent distribution companies (DISCOs) that distribute electric supply (power) to end user consumers. The funding from ADB is expected to be released in stages (tranches). 3. The Power Distribution Enhancement (PDE) Investment Program is part of the GoP long term energy security strategy. The proposed ADB intervention will finance new investments in PDE and assist capacity building of sector related agencies. The investment program will cover necessary PDE development activities in secondary transmission/distribution networks of DISCOs. The PDEMFF activities include construction of new grid stations, extension (additional transformers) and augmentation (replacement of transformers with higher capacity), distribution line extensions, new and replacement distribution lines, additional sub-stations, transformer protection and other non network activities. 4. This IEE presents the results and conclusions of environmental assessment for ten (10) Augmentation Sub-projects proposed by MEPCO and has been submitted by Pakistan Electric Power Company (PEPCO) on behalf of MEPCO. PEPCO has been nominated by Ministry of Water and Power to act as the Executing Agency (EA) with each DISCO (MEPCO) being the Implementing Agency (IA) for work in its own area. PEPCO‟s role in the processing and implementation of the investment program is that of a coordinator of such activities as preparation of PC-1s and Project Financing Requests (PFRs), monitoring implementation activities; that includes submission of environmental assessments for all sub-projects in all tranches of the PDEMFF under ADB operating procedures. An IEE has been carried out to fulfill the requirements of ADB Safeguards Policy Statement 2009. 5. Requirements for Environmental Assessment 6. Under the Multi Finance Facility (MFF) loan procedures of ADB, implementation of safeguards is to be achieved under ADB Guidelines. The project that have some adverse environmental impacts but of lesser degree or significance such as Construction of new 132Kv Grid Station is categorized as Category “B” project. Pak-EPA emphases that proponent must follow the Section 12 of the Pakistan Environmental Protection Act (PEPA) 1997 for all subprojects. Pak-EPA has also assumed that all proponents will consult with the relevant provincial EPAs and follow their advice. With 18th Amendment in Constitution, more power regarding environment are delegated to the provinces. Therefore, this IEE finalized will be submitted to provincial Environmental Protection Department (EPD), Punjab for Approval/No Objection Certificate (NOC) for proposed subproject. 7. Under GoP regulations, the Pakistan Environmental Protection Agency (Pak-EPA) Review of Initial Environmental Examination and Environmental Impact Assessment Regulations (2000) categorizes development projects into two schedules according to their potential environmental impact. The proponents of projects that have reasonably foreseeable impacts are required to submit an IEE for their respective projects (Schedule I). Projects that have more adverse environmental impact (Schedule II) are required to submit an environmental impact assessment (EIA) to the respective provincial Environmental Protection Agency (EPA). According to the Pak-EPA Regulations 2000 for Review of IEE and EIA, Distribution lines and sub-stations are included under energy projects and IEE is required for Transmission lines less than 11Kv, and large distribution projects (Schedule I).