wr Report and Recommendation of the President to the Board of Directors Project Number: 51077-003 July 2020 Proposed Loan, Grant, Technical Assistance Grant, and Administration of Loan and Grant Republic of Maldives: Greater Malé Waste-to-Energy Project Distribution of this document is restricted until it has been approved by the Board of Directors. Following such approval, ADB will disclose the document to the public in accordance with ADB’s Access to Information Policy. CURRENCY EQUIVALENTS (as of 7 July 2020) Currency unit – Rufiyaa (Rf) Rf1.00 = $0.06 $1.00 = Rf15.40 ABBREVIATIONS 3R – reduce-reuse-recycle ADB – Asian Development Bank AIIB – Asian Infrastructure Investment Bank COVID-19 – coronavirus disease DBO – design–build–operate EIA – environmental impact assessment EIRR – economic internal rate of return EMP – environmental management plan EPA – Environmental Protection Agency FMA – financial management assessment ha – hectare JFJCM Japan Fund for the Joint Crediting Mechanism MOE – Ministry of Environment MOF – Ministry of Finance MW – megawatt O&M – operation and maintenance PAM – project administration manual PMU – project management unit SWM – solid waste management TA – technical assistance tpd – tons per day TRTA – transaction technical assistance WTE – waste-to-energy NOTE In this report, "$" refers to United States dollars. Vice-President Shixin Chen, Operations 1 Director General Kenichi Yokoyama, South Asia Department (SARD) Director Norio Saito, Urban Development and Water Division (SAUW), SARD Team leader Luca Di Mario, Urban Development Specialist, SAUW, SARD Team members Mikael Andersson, Financial Management Specialist, Portfolio, Results and Quality Control Unit, SARD Saswati Belliappa, Safeguards Specialist, SAUW, SARD Dharmesh Dawda, Procurement Specialist, Procurement Division 1, Procurement, Portfolio and Financial Management Department Shintaro Fujii, Environment and Climate Change Specialist, Climate Change and Disaster Risk Management Division (SDCD), Sustainable Development and Climate Change Department (SDCC) Steven Goldfinch, Disaster Risk Management Specialist, SDCD, SDCC Jaimes Kolantharaj, Energy Specialist, Energy Division (SAEN), SARD Emma Marsden, Senior Environment Specialist, SAEN, SARD Masato Nakane, Senior Economist, Regional Cooperation and Operations Coordination Division, SARD Roshan Ouseph, Senior Counsel, Office of the General Counsel Ninette Pajarillaga, Environment Specialist (Safeguards), Portfolio, Results, Safeguards and Gender Unit, Central and West Asia Department Santosh Pokharel, Urban Economist, SAUW, SARD Erwin Salaveria, Associate Partnerships Officer, Strategic Partnerships Division, Strategy, Policy and Partnerships Department Maria Angelica Zosa, Operations Assistant, SAUW, SARD Peer reviewer Satoshi Ishii, Principal Urban Development Specialist, Urban Development and Water Division, Southeast Asia Department 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. CONTENTS Page PROJECT AT A GLANCE MAP I. THE PROPOSAL 1 II. THE PROJECT 1 A. Rationale 1 B. Project Description 4 C. Value Added by ADB 5 D. Summary Cost Estimates and Financing Plan 5 E. Implementation Arrangements 7 III. ATTACHED TECHNICAL ASSISTANCE 8 IV. DUE DILIGENCE 8 A. Technical 8 B. Economic and Financial Viability 9 C. Sustainability 10 D. Governance 10 E. Poverty, Social, and Gender 11 F. Safeguards 11 G. Summary of Risk Assessment and Risk Management Plan 12 V. ASSURANCES 13 VI. RECOMMENDATION 13 APPENDIXES 1. Design and Monitoring Framework 14 2. List of Linked Documents 17 Project Classification Information Status: Complete PROJECT AT A GLANCE 1. Basic Data Project Number: 51077-003 Project Name Greater Male Waste-to-Energy Project Department/Division SARD/SAUW Country Maldives Executing Agency Ministry of Finance Borrower Government of Maldives (formerly Ministry of Finance and Treasury) Country Economic https://www.adb.org/Documents/LinkedDocs/ Indicators ?id=51077-003-CEI Portfolio at a Glance https://www.adb.org/Documents/LinkedDocs/ ?id=51077-003-PortAtaGlance 2. Sector Subsector(s) ADB Financing ($ million) Water and other urban Urban policy, institutional and capacity development 4.50 infrastructure and services Urban solid waste management 60.89 Energy Renewable energy generation - biomass and waste 8.00 Total 73.39 3. Operational Priorities Climate Change Information Addressing remaining poverty and reducing inequalities GHG reductions (tons per annum) 40,000 Accelerating progress in gender equality Climate Change impact on the High Tackling climate change, building climate and disaster resilience, and Project enhancing environmental sustainability Making cities more livable ADB Financing Strengthening governance and institutional capacity Adaptation ($ million) 7.11 Mitigation ($ million) 59.89 Cofinancing Adaptation ($ million) 0.00 Mitigation ($ million) 49.50 Sustainable Development Goals Gender Equity and Mainstreaming SDG 6.3 Some gender elements (SGE) SDG 11.6 SDG 12.5 Poverty Targeting SDG 13.a Geographic Targeting 4. Risk Categorization: Complex . 5. Safeguard Categorization Environment: A Involuntary Resettlement: C Indigenous Peoples: C . 6. Financing Modality and Sources Amount ($ million) ADB 73.39 Sovereign Project grant: Asian Development Fund 35.18 Sovereign Project (Concessional Loan): Ordinary capital resources 38.21 Cofinancing 50.00 Asian Infrastructure Investment Bank - Project loan (Partial ADB 40.00 Administration) Japan Fund for the Joint Crediting Mechanism - Grant projects (Full ADB 10.00 Administration) Counterpart 27.74 Government 27.74 Total 151.13 Note: An attached technical assistance will be financed on a grant basis by the Technical Assistance Special Fund (TASF-6) in the amount of $500,000. Currency of ADB Financing: US Dollar Source: Asian Development Bank This document must only be generated in eOps. 11032020100910994603 Generated Date: 01-Jul-2020 15:52:11 PM o o MALDIVES 72 00'E 74 00'E GREATER MALÉ THILADHUNMATHEE UTHURUBURI WASTE-TO-ENERGY PROJECT (Haa Alifu Atoll) Gallandhoo Channel THILADHUNMATHEE DHEKUNUBURI (Haa Dhaalu Atoll) ZONE 1 MILADHUNMADULU UTHURUBURI (Shaviyani Atoll) Moresby Channel MILADHUNMADULU DHEKUNUBURI (Noonu Atoll) o MAALHOSMADULU UTHURUBURI o 6 00'N (Raa Atoll) 6 00'N N FAADHIPPOLHU 0 50 100 ZONE 2 (Lhaviyani Atoll) Kilometers MAALHOSMADULU DHEKUNUBURI (Baa Atoll) Outer Islands National Capital Atoll Administrative Boundary Boundaries are not necessarily authoritative. ZONE 3 ARI ATHOLHU UTHURUBURI (Alifu Alifu Atoll) This map was produced by the cartography unit of the Asian Development ( project area ) Bank. The boundaries, colors, denominations, and any other information MALE’ ATHOLHU shown on this map do not imply, on the part of the Asian Development Bank, Outer Islands Vaadhoo (Kaafu Atoll) any judgment on the legal status of any territory, or any endorsement or Channel GREATER MALÉ acceptance of such boundaries, colors, denominations, or information. ARI ATHOLHU DHEKUNUBURI Outer Islands (Alifu Dhaalu Atoll) Kanduoih-giri Fulidu Channel GREATER MALÉ Gaagandu Furanafushi FELIDHE ATHOLHU Ariadhoo Channel (Vaavu Atoll) Aramh Thilafushi Outer Islands Location for proposed NILANDHE ATHOLHU UTHURUBURI waste-to-energy plant Vihamanaafushi (Faafu Atoll) Vattaru Channel Hulhumalé Giraavaru Feydhoofinolhu MULAKU ATHOLHU ZONE 4 (Meemu Atoll) Gulhi Falhu NILANDHE ATHOLHU DHEKUNUBURI Malé Villingili (Dhaalu Atoll) Kudahuvadhoo Channel KOLHUMADULU ZONE 2 ZONE 3 (Thaa Atoll) (project area) HADHDHUNMATHI (Laamu Atoll) ZONE 5 MAALHOSMADULU DHEKUNUBURI Veymandoo Channel (Baa Atoll) MALE’ATHOLHU ARI ATHOLHU UTHURUBURI (Kaafu Atoll) (Alifu Alifu Atoll) Outer One and Half Degree Channel Islands HUVADHU ATHOLHU UTHURUBURI (Gaafu Alifu Atoll) Outer ZONE 6 Islands Vaadhoo GREATER Channel MALÉ Outer (Gaafu Dhaalu Atoll) Islands HUVADHU ATHOLHU DHEKUNUBURI o 0 o 00'N 0 00'N Equatorial Channel ARI ATHOLHU DHEKUNUBURI Fulidu Channel FUVAHMULAH (Alifu Dhaalu Atoll) FELIDHEATHOLHU (Gnaviyani Atoll) (Vaavu Atoll) ZONE 7 Outer ZONE 4 Ariadhoo Channel Islands ADDU ATHOLHU NILANDHEATHOLHU UTHURUBURI (Seenu Atoll) (Faafu Atoll) o Vattaru Channel 72 00'E 74 o 00'E 200089 19MLD ABV I. THE PROPOSAL 1. I submit for your approval the following report and recommendation on (i) a proposed loan; and (ii) a proposed grant, both to the Republic of Maldives for the Greater Malé Waste-to-Energy Project.1 The report also describes (i) the proposed partial administration of a loan to be provided by the Asian Infrastructure Investment Bank (AIIB) for the project; (ii) the proposed administration of a grant to be provided by the Japan Fund for the Joint Crediting Mechanism (JFJCM); and (iii) proposed technical assistance (TA) for Supporting Capacity for Sustainable Waste-to-Energy Service Delivery, and if the Board approves the proposed loan and grant, I, acting under the authority delegated to me by the Board, approve the TA and administration of the loan and grant. 2. The project will establish a sustainable regional solid waste management (SWM) system for the Greater Malé region and its neighboring outer islands by (i) developing treatment (proven waste-to-energy [WTE] technology), recycling, and disposal infrastructure; (ii) strengthening institutional capacities for sustainable solid waste services delivery