PJSC “Ukrhydroenergo” (UHE) Performance improvement Project “Improving Power System Resilience for European Power Grid Integration” ENERGY SECURITY PROJECT (ESP) Environmental and Social Management Plan (ESMP) ACRONYMS BMS Battery management system BoS Balance of system CAPEX Capital expenditures CH Critical habitat CMU Cabinet Ministers of Ukraine CSR Corporate social responsibility EES Battery energy storage system EHS Environmental, health and safety EMS Energy management system ENTSO-E European Network of Transmission System Operators for Electricity ESA Environmental and Social Assessment EIA Environmental Impact Assessment EPC Engineering, Procurement and Construction ESF Environmental and Social Framework ESIA Environmental and Social Impact Assessment ESMP Environmental and Social Management Plan ESS Environmental and Social Standards EU European Union EVA Ethylene Vinyl Acetate FCR Frequency Containment Reserve (a/m)FRR (automatic/manual) Frequency Restoration Reserve GDP Gross Domestic Product GIIP Good International Industry Practice GRM Grievance Redress Mechanism H&S Health and Safety HDG Hot-dip galvanized HPP Hydropower generation plant HV High Voltage IA Implementing Agency IBA Important Bird Area IFC International Finance Corporation ILO International Labour Organization IEC International electrotechnical commission IPS Integrated Power System of Ukraine IRENA International renewable energy agency IRR Internal rate of return IUCN International Union for Conservation of Nature KBA Key Biodiversity Area LMP Labour Management Procedures MW Megawatt MWh Megawatt hour MWp Megawatt-peak NEURC National Commission for State Regulation of Energy and Public Utility Services PAP Project Affected Person PPE Personal Protective Equipment PSP [Hydropower] Pump Storage Plant PFS Pre-feasibility Study PV Photovoltaic PVC Polyvinyl Chloride O&M Operation and maintenance OHS Occupational Health and Safety OVD Ukraine EIA RE Renewable energy 1 SEP Stakeholder Engagement Plan SESA Strategic Environmental and Social Assessment SMS Storage management system TSO Transmission System Operator UHE PJSC “Ukrhydroenergo” UE National Power Company (NPC) UkrEnergo, PrJSC USAID United States Agency for International Development USD United Stated Dollar VDC Voltage direct current VAC Voltage alternating current WB The World Bank WBG World Bank Group Wp Watt-peak 2 TABLE OF CONTENTS ACRONYMS 1 EXECUTIVE SUMMARY 5 BACKGROUND 5 ENVIRONMENTAL AND SOCIAL MANAGEMENT PLAN 6 PROJECT LOCATION AND DESCRIPTION 6 POTENTIAL KEY IMPACTS 6 CONCLUSIONS AND RECOMMENDATIONS 7 INTRODUCTION 8 PROJECT DESCRIPTION 8 PROJECT GOALS AND OBJECTIVES 9 THE PROJECT GOALS AND OBJECTIVES INCLUDE THE FOLLOWING: 9 ASSOCIATED FACILITIES 9 ENVIRONMENTAL AND SOCIAL FRAMEWORK 9 ESMP METHODOLOGY 11 PROJECT TECHNOLOGY AND CONFIGURATION 12 PROJECT TECHNOLOGY 12 PROJECT CONFIGURATION 14 LOCATION CONSIDERATIONS 16 PEST CONTROL 18 SITE LOCATION AND LAYOUTS 18 ENVIRONMENTAL AND SOCIAL IMPACTS AND MITIGATION 25 PREAMBLE 25 ASSESSMENT AND MANAGEMENT OF ENVIRONMENTAL AND SOCIAL RISKS AND IMPACTS (ESS1) 25 LABOUR AND WORKING CONDITIONS (ESS2) 26 RESOURCE EFFICIENCE AND POLLUTION PREVENTION AND MANAGEMENT (ESS3) 35 COMMUNITY HEALTH AND SAFETY (ESS4) 46 BIODIVERSITY CONSERVATION AND SUSTAINABLE MANAGEMENT OF LIVING NATURAL RESOURCES (ESS6) 53 CULTURAL HERITAGE (ESS8) 62 STAKEHOLDER ENGAGEMENT AND INFORMATION DISCLOSURE (ESS10) 65 MONITORING AND REPORTING 66 INCIDENT RESPONSE 74 IMPLEMENTATION, CAPACITY DEVELOPMENT AND TRAINING 76 BID AND CONTRACT DOCUMENTS 76 ESMP IMPLEMENTATION RESPONSIBILITIES 76 IMPLEMENTATION SCHEDULE 79 CAPACITY DEVELOPMENT AND TRAINING 80 GRIEVANCE MECHANISM 82 DEFINITIONS OF THE GRM 82 GRM SCOPE AND USE 82 GRM OVERVIEW AND STRUCTURE, COMMUNICATION AND PROCESS 82 ANONYMOUS COMPLIANTS 83 CONFIDENTIALITY AND CONFLICT OF INTEREST 83 RECEIPT AND RECORDING OF COMPLAINTS 83 3 INVESTIGATION 83 RESPONSE TO COMPLAINANT 84 REPORTING 84 FURTHER ACTIONS 84 WORLD BANK GRIEVANCE REDRESS SYSTEM 85 APPENDIX A - IMPACT ASSESSMENT METHODOLOGY 86 APPENDIX B - CORRESPONDANCE 93 APPENDIX C - POLICY, LEGAL AND REGULATORY FRAMEWORK94 APPENDIX D – COVID-19 GUIDELINES FOR EPC CONTRACTOR 109 APPENDIX E – ENVIRONMENTAL AND SOCIAL INCIDENT RESPONSE 117 APPENDIX F – CRITICAL HABITAT ASSESSMENT 125 4 EXECUTIVE SUMMARY BACKGROUND PJSC “Ukrhydroenergo’s (UHE’s) operations are critical for providing balancing power in the Integrated Power System of Ukraine (IPS). UHE has significant hydropower and pumped storage resources that are used to provide load-supply balance at short notice, due to the large reliance on inflexible nuclear power generation. Despite UHE’s balancing role being complemented by less maneuverable thermal power generation, Ukraine’s IPS continues to rely on the Russian power system for needed flexibility, especially for rapid response requirements. Further, due to the penetration of large volumes of renewable energy the need for rapid response is made even more acute. The Project will support the integration of the IPS to the European Network of Transmission System Operators for Electricity (ENTSO-E), which requires significant increase in the flexibility of the system, both during its isolated operation prior to full synchronization, when Ukraine disconnects from the Russian grid, as well as for post-synchronization operations, when Ukraine is finally connected to and becomes a part of the European grid. To help address the issues and challenges identified above the project “Improving Power Sector Resilience and Competitiveness in Preparation for Integration with the European Power Grid” (hereinafter – the “Project”) will add utility-scale battery storage facilities (hereinafter – the “batteries”) at three proposed hydropower generation plants (HPPs) and one hydropower pump storage plant (PSP) of UHE. At each of the selected sites, the batteries will be integrated with the HPP/PSP units thus forming hybrid units, the operation of which will be managed by an advanced energy management system (EMS). Limited solar photovoltaic (PV) generation facilities will be added at each site for building resilience. As a result the Project will extend the range of ancillary services - Frequency Containment Reserve (FCR), Frequency Restoration Reserve (FRR), reactive power/voltage regulation, “black start”, etc. - that UHE provides on the Ukrainian wholesale electricity market and improve their quality (including faster response and ramp-up rate). It will also help to extend the lifetime of HPP/PSP turbines and decrease repair and maintenance costs by reducing the stress on power generation equipment in the process of start-up and in the conditions of highly volatile operation. A significant environmental benefit of the Project is increasing maneuverability of hydropower generation through the compatibility with storage batteries to address system flexibility needs resulting from renewable energy penetration and thereby mitigating the negative effect of “green-coal paradox”, a situation where increasing renewable energy power output needs to be balanced by the outdated and worn-out coal-fired power generation with high minimal loads, leading to higher air emissions which have impacts in terms of climate change and to human health. Each of the hydropower plants proposed for the installation of battery storage facility and solar PV arrays includes a different storage system composition and different solar arrays , determined by the size and number of the hydropower plant units and the consumption of the plant auxiliaries. The four proposed plants are: • Kyiv PSP (46 MW storage facility and 10.6 MW Photovoltaic (PV) plant); • Kaniv HPP (3 x 22 MW storage facility and 13.5 MW PV plant); • Kremenchuck HPP (60 MW storage facility and 6.5 MW PV plant); and • Seredniodniprovska HPP (25 MW storage facility and 5.3 MW PV plant). 5 Thus, the total capacity of the installed battery storage facilities is 197 MW and the total capacity of the solar PV arrays is 35.9 MW. A social responsibility sub-project (CSR project) at Dnistrovska HPP includes 15 MW 6six-hour Zinc Air Battery and 28 MW PV plant). The battery storage facility will be partially charged by the PV plant and will be used to provide electricity for electric vehicles (EVs at a special low rate1 thus supporting a decrease in vehicle emissions. The rationale for choosing this site for the CSR component is due to it having adequate interconnection capacity and population close enough for power distribution with minimum losses. The CSR component does not include the construction of charging points and will not result in any increase the volumes of traffic on the streets, its aim is to simply provide low cost renewable electricity for electric vehicles. ENVIRONMENTAL AND SOCIAL MANAGEMENT PLAN As part of the Projects compliance with the World Banks Environmental and Social Framework (ESF, 2018), an Environmental and Social Management Plan (ESMP) has been prepared to detail: a) The measures to be taken during the implementation and operation of a project to eliminate or offset adverse environmental and social impacts, or to reduce them to acceptable levels; and b) The actions needed to implement these measures. PROJECT LOCATION AND DESCRIPTION All sites are within the boundaries of the lands assigned for UHE use along the dam/reservoirs, and do not encroach on grown forests, main customary walkways, customary recreation areas, waterfront accesses, sidewalks, roads, power lines or other infrastructure. The Project will make use of fully mature and