Technical Assistance Consultant’s Report Project Number: 43357 October 2011 Mongolia: Ulaanbaatar Low Carbon Energy Supply Project Using a Public-Private Partnership Model (Financed by the Japan Special Fund) Feasibility Report Appendix 4: Environmental Impact Assessment Report Prepared by: HJI Group Corporation in Association with MonEnergy Consult Co. Ltd. For: Ministry of Mineral Resources and Energy, Mongolia This report does not necessarily reflect the views of ADB or the Government concerned, and ADB and the Government cannot be held liable for its contents. (For project preparatory technical assistance: All the views expressed herein may not be incorporated into the proposed project’s design. ENVIRONMENTAL IMPACT ASSESSMENT REPORT Project Number: 7502-MON June 2011 Ulaanbaatar Low Carbon Energy Supply Project Using Public-Private Partnership Model (CHP5 Project) Ulaanbaatar Low Carbon Energy Supply Project Final Report Using Public-Private Partnership Model (TA No. 7502-MON) Appendix 4 CURRENCY EQUIVALENTS (As of 1 May 2011) Currency Unit - Togrog (MNT) 1.00 MNT = $ 0.0008 $1.00 = 1,255 MNT ABBREVIATIONS ACM – Asbestos-Containing Material ADB – Asian Development Bank BOD – Biological Oxygen Demand CBD – Convention on Biological Diversity CCPs – Coal Combustion Products CITES – Convention on International Trade in Endangered Species CES – Central Energy System CFB – Circulating Fluidized Bed CHP – Combined Heat and Power CO – Carbon Monoxide CO2 – Carbon Dioxide COD – Chemical Oxygen Demand CSCs – Construction Supervision Companies ED – Environmental Department EES – Eastern Energy System EHS – Environmental Health and Safety EIA – Environmental Impact Assessment EID – Environmental Inspection Department EIRR – Economic Internal Rate of Return EML – Environmental Monitoring Laboratory EMP – Environmental Management Plan EPA – Environmental Protection Agency ESP – Electrostatic Precipitator FBC – Fluidized-bed Combustion FF – Fabric Filter FGD – Flue Gas Desulphurization FGR – Flue Gas Recycling FS – Feasibility Study Appendix 4-i Ulaanbaatar Low Carbon Energy Supply Project Final Report Using Public-Private Partnership Model (TA No. 7502-MON) Appendix 4 GDP – Gross Domestic Product GHG – Greenhouse Gases GIIP – Good International Industry Practice GRM – Grievance Redress Mechanism GSA – Gas Suspension Absorber HES – Heat Exchange Stations HOB – Heat Only Boilers IA – Implementation Agency ID – Induced Draft IEE – Initial Environmental Examination IGCC – Integrated Gasification Combined Cycle JICA – Japan International Cooperation Agency L&FS – Life and Fire Safety LOI – Loss on Ignition MMRE – Ministry of Mineral Resources and Energy MNET – Ministry of Nature, Environment and Tourism NOx – Nitrogen Oxides OM – Operation Manual OSH – Occupational Safety and Health PC – Pulverized Coal PC – Public Consultation PFBC – Pressurized Fluidized Bed Combustion PIU – Project Implementation Unit PM – Particulate Matters POPs – Persistent Organic Pollutants PPCU – Project Public Complaints Unit PPE – Personal Protective Equipment RPM – Respirable Particulate Matter SCR – Selective Catalytic Reduction SHE – Safety, Health and Environment SNCR – Selective Non-catalytic Reduction SO2 – Sulfur Dioxide SPA – Specially Protected Area SPS – Safeguard Policy Statement SR – Stoichiometric Ratio TA – Technical Assistance TSP – Total Suspended Particulates Appendix 4-ii Ulaanbaatar Low Carbon Energy Supply Project Final Report Using Public-Private Partnership Model (TA No. 7502-MON) Appendix 4 UB – Ulaanbaatar UNCCD – UN Convention on Combating Desertification UNFCCC – UN Framework Convention on Climate Change WES – Western Energy System WEIGHTS AND MEASURES GW (giga watt) – 1,000,000,000 watts kVA (kilovolt-ampere) – 1,000 volt-amperes kW (kilowatt) – 1,000 watts kWh (kilowatt-hour) – 1,000 watts-hour MW (megawatt) – 1,000,000 watts W (watt) – unit of active power Cal (Calorie) – unit of energy Gcal/h (giga calorie/hr) – 1,000,000,000 calorie/hr NOTE In this report, “$” refers to U.S. dollar. Appendix 4-iii Ulaanbaatar Low Carbon Energy Supply Project Final Report Using Public-Private Partnership Model (TA No. 7502-MON) Appendix 4 TABLE OF CONTENTS I. EXECUTIVE SUMMARY ...........................................................................................................................1 A. INTRODUCTION........................................................................................................................................1 B. BACKGROUND .........................................................................................................................................1 C. ASSESSMENT OF HEATING AND POWER DEMAND ............................................................................................2 D. ANALYSIS OF ALTERNATIVES AND SITE SELECTION ............................................................................................2 E. PROPOSED CHP5 PLANT ...........................................................................................................................3 F. EXPECTED ENVIRONMENTAL BENEFITS ..........................................................................................................3 G. ANTICIPATED ENVIRONMENTAL IMPACTS AND PROPOSED MITIGATION MEASURES.................................................4 H. ENVIRONMENTAL MITIGATION COSTS...........................................................................................................5 I. PUBLIC CONSULTATION AND ENVIRONMENTAL MANAGEMENT PLAN...................................................................5 J. CONCLUSION...........................................................................................................................................6 II. POLICY, LEGAL, AND ADMINISTRITIVE FRAMWORK ................................................................................7 A. DOMESTIC ENVIRONMENTAL LAWS, POLICIES AND STANDARDS ..........................................................................7 B. ENVIRONMENTAL IMPACT ASSESSMENT REQUIREMENTS...................................................................................8 C. ADMINISTRATIVE FRAMEWORK .................................................................................................................10 D. APPLICABLE INTERNATIONAL ENVIRONMENTAL AGREEMENTS...........................................................................13 III. DESCRIPTION OF THE PROJECT .............................................................................................................15 A. PROPOSED CAPACITY AND KEY PARAMETERS OF CHP5...................................................................................15 B. DESCRIPTION OF THE SITE FOR THE CHP5......................................................................................................2 C. LAYOUT AND CONSTRUCTION SEQUENCE OF THE CHP5 PLANT...........................................................................2 D. MAIN EQUIPMENT AND FACILITIES TO BE INSTALLED ........................................................................................6 E. AUTOMATIC ENVIRONMENTAL MONITORING INSTRUMENT .............................................................................13 F. CIVIL ENGINEERING.................................................................................................................................13 G. PROPOSED HEATING PIPELINE SYSTEM AND OPERATION PARAMETERS...............................................................14 H. STAFFING PLAN......................................................................................................................................15 I. COAL SUPPLY AND TRANSPORTATION .........................................................................................................15 J. JUSTIFICATION AND RATIONALE .................................................................................................................22 IV. DESCRIPTION OF ENVIRONMENT..........................................................................................................28 A. PHYSICAL ENVIRONMENT .........................................................................................................................28 B. ECOLOGICAL ENVIRONMENT .....................................................................................................................31 C. CULTURAL HERITAGE ..............................................................................................................................31 D. TRANSPORTATION ..................................................................................................................................32 E. SOCIOECONOMIC CONDITIONS ..................................................................................................................32 F. ENVIRONMENTAL BASELINE......................................................................................................................33 F. PROJECT IMPACT AREA AND ENVIRONMENTAL PROTECTION SITES ....................................................................47 V. ALTERNATIVE ANALYSIS .......................................................................................................................51 Appendix 4-iv Ulaanbaatar Low Carbon Energy Supply Project Final Report Using Public-Private Partnership Model (TA No. 7502-MON) Appendix 4 A. WITH AND WITHOUT THE CHP5 PROJECT ...................................................................................................51 B. ALTERNATIVES OF THE CHP5 LOCATION......................................................................................................51