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Power Transmission and Distribution Efficiency Enhancement Project (RRP NEP 50059)

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Power Transmission and Distribution Efficiency Enhancement Project (RRP NEP 50059) Power Transmission and Distribution Efficiency Enhancement Project (RRP NEP 50059) Initial Environmental Examination Document Stage: Draft Project Number: 50059-002 May 2017 Nepal: Power Transmission and Distribution Efficiency Enhancement Project Prepared by Nepal Electricity Authority for the Asian Development Bank. CURRENCY EQUIVALENTS (as of 05/02/2017) Currency unit – Nepali rupees (NRs) NRs1.00 = $ 0.0091 $1.00 = NRs109.53 ABBREVIATIONS ADB Asian Development Bank AP Affected Persons CDO Chief District Officer CFC Compensation Fixation Committee DDC District Development Committee EA Executing Agency EE Energy Efficiency EMP Environmental Management Plan EPR Environment Protection Rules GIS Gas insulated substation GoN Government of Nepal GRC Grievance Redress Committee (GRC) GWh Gigawatt-hour kV Kilovolt IEE Initial Environmental Examination MOE Ministry of Energy MoPE Ministry of Population and Environment MVA Megavolt-amperes NEA Nepal Electricity Authority NEPAP Nepal Environmental Policy and Action Plan ODL Over Ground Distribution Line PMD Project Implementation Unit PMU Project Management Unit RE Renewable energy RoW Right of Way SF6 Sulfur hexafluoride SPS ADB Safeguard Policy Statement 2009 SS Substation UDL Underground Distribution Line VDC Village Development Committee This initial environmental examination 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. Your attention is directed to the “terms of use” section on ADB’s website. In preparing any country program or strategy, financing any project, or by making any designation of or reference to a particular territory or geographic area in this document, the Asian Development Bank does not intend to make any judgments as to the legal or other status of any territory or area. TABLE OF CONTENTS EXECUTIVE SUMMARY 1 A. Introduction 1 B. Summary of Findings 2 C. Report Organization 3 I. POLICY, LEGAL, AND ADMINISTRATIVE FRAMEWORK 4 II. DESCRIPTION OF THE PROJECT 8 A. Project Components 8 B. Rationale and Need for the Project 10 C. Alternatives to the Proposed Project 11 III. DESCRIPTION OF THE ENVIRONMENT 13 A. Project Area 13 B. Geography, Geology, and Soils 14 C. Climatic and Meteorological Conditions 17 D. Air Quality 18 E. Water Resources 20 F. Cultural Resources 21 G. Biological Resources 23 H. Socio-Economic Conditions 23 I. Proposed Project Sites 24 IV. ANTICIPATED ENVIRONMENTAL IMPACTS AND MITIGATION MEASURES 31 A. Design Principles and Construction Methods 32 B. Potential Impacts 34 C. Mitigation Measures 42 D. Cumulative and Induced Impacts 44 V. INFORMATION DISCLOSURE, CONSULTATION, AND PARTICIPATION 45 VI. ENVIRONMENTAL MANAGEMENT PLAN 49 A. Proposed Monitoring Plan 49 B. Proposed Management and Mitigation Measures 50 C. Work Program 57 D. Responsibilities for Mitigation, Monitoring, Reporting, and Review 58 E. Environmental Management Plan Cost Estimates 59 F. Provision for Initial Environment Examination / Environmental Management Plan Update 60 VII. CONCLUSIONS AND RECOMMENDATIONS 61 Key Findings 61 List of Tables Table 1: Relevant National and International Environmental Regulatory Frameworks Relevant to Energy Development ............................................................................................................................. 5 Table 2: Environmental Classification According to SPS 2009 ............................................................. 6 Table 3: Environmental Performance Indicators .................................................................................. 13 Table 4: World Heritage Sites and Proximity to Substations ............................................................... 22 Table 5: Demographic Status of Project Area ...................................................................................... 23 Table 6: Project Footprint ..................................................................................................................... 32 Table 7: Potential Impacts and Mitigation Measures for Overall Project ............................................. 39 Table 8: Minimum Provisions for Environmental Monitoring................................................................ 50 Table 9: Preliminary Environmental Management Plan ....................................................................... 51 Table 10: Environmental Management Plan Work Plan ...................................................................... 57 Table 11: Preliminary Environmental Management Plan Cost Estimates ........................................... 60 List of Figures Figure 1: Project Outputs ....................................................................................................................... 9 Figure 2: Project Organization ............................................................................................................... 9 Figure 3a: Earthquakes in Nepal ......................................................................................................... 15 Figure 3b: Project Location in Relation to 2015 Earthquake Epicenter and Number of Household Destroyed in Figures for District of May 22, 2015 ............................................................................... 16 Figure 3c: Project Location Relative to Major Rivers and Highways................................................... 16 Figure 4: Temperature Variation at Project Area .................................................................................. 17 Figure 5: Precipitation at Project Area ................................................................................................. 17 Figure 6: Wind Speed at Project Area ................................................................................................. 18 Figure 7: Sources of PM10 Emissions in Kathmandu Valley .............................................................. 19 Figure 8: Monthly PM10 Levels in Kathmandu Valley November 2002 – December 2006 ................ 19 Figure 9: Daily PM10 Levels at 3 Stations in KTM Valley October 2013 – March 2014 ..................... 20 Figure 10a: Project Locations Relative to World Heritage Sites ......................................................... 21 Figure 10b: Project Locations .............................................................................................................. 22 Figure 11: Lapsiphedi Substation Site ................................................................................................. 25 Figure 12: Changunarayan Substation Site ......................................................................................... 25 Figure 13: Phutung Substation Site ..................................................................................................... 26 Figure 14: Moolpani Substation Site .................................................................................................... 26 Figure 15: Moolpani Substation Site .................................................................................................... 27 Figure 16: Chapagaun Substation Site ................................................................................................ 27 Figure 17: Chapagaun Substation Site Access Road ......................................................................... 28 Figure 20: Existing Conditions to be Improved by the Project ............................................................ 30 Figure 21: Schematic of Pollutant Sources, Pathways, and Receptors .............................................. 31 Figure 20: Locations of Consultations ................................................................................................. 45 Figure 21: Grievance Redress Mechanism Complaint Flow ............................................................... 48 Figure 22: Roles and Responsibilities for Environmental Management Plan Implementation ........... 58 EXECUTIVE SUMMARY A. Introduction i. The proposed Nepal Power Transmission and Distribution Efficiency Enhancement Project (the Project) will enhance the transmission and distribution system (also referred to as “the grid”) to improve reliability and quality of electric supply in the Kathmandu Valley by reducing system overloads, and technical, non-technical, and commercial losses. The project will support system efficiency upgrades and energy efficiency measures such as advanced grid operations software, system automation, and advanced metering. System efficiency improvements and loss reductions will improve the Nepal Electricity Authority’s (NEA) financial health, improve electricity supply and reliability, and reduce dependence on petroleum-fueled generators. Operational upgrades will also facilitate improved system planning and operational efficiency, and provide sufficient distribution network capacity to absorb new generation output scheduled to come on-line during the next several years. The project will demonstrate the potential for energy efficiency achievements in the distribution systems which can be replicated in other cities of Nepal such as Biratnagar, Birgunj, Pokhara, Bhairahwa, and Butwal where distribution system upgrades are critical. ii. Beginning in March 2016, reconnaissance was conducted at several candidate substation sites around the Kathmandu Valley and confirmed the need for overhauling the distribution network. The current transmission and distribution system of Kathmandu Valley is characterized with
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