Initial Environmental Examination August 2019 Tuvalu: Increasing Access to Renewable Energy Prepared by Tuvalu Electricity Corporation for the Asian Development Bank This initial environmental examination is a document of the borrower. The views expressed herein do not necessarily represent those of the ADB’s Board of Directors, Management, or staff, and may be preliminary in nature. 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 ABBREVIATIONS v 1. INTRODUCTION 1 A. Project Background 1 B. Objectives and Scope of IEE 3 2. LEGAL AND POLICY FRAMEWORK 4 A. Legal and Policy Framework of Tuvalu 4 B. ADB Safeguard Policy Statement 7 3. PROJECT DESCRIPTION 8 A. Rationale 8 B. Proposed Works and Activities 9 4. BASELINE INFORMATION 22 A. Physical Resources 22 B. Terrestrial Biological Resources 34 C. Marine Biological Resources of Nukufetau 51 D. Socio-economic Resources 66 5. ANTICIPATED IMPACTS AND MITIGATION MEASURES 79 A. Overview 79 B. Design and Pre-construction Impacts 79 C. Construction Impacts on Physical Resources 82 D. Construction Impacts on Biological Resources 85 E. Construction Impacts on Socio-economic Resources 86 F. Operation Impacts 89 G. Decommissioning impacts 90 6. ANALYSIS OF ALTERNATIVES 91 7. CONSULTATION AND INFORMATION DISCLOSURE 92 A. Consultation 92 B. Information Disclosure 94 8. GRIEVANCE REDRESS MECHANISM 95 9. ENVIRONMENTAL MANAGEMENT PLAN 97 A. Introduction 97 B. Implementation arrangement and responsibilities 97 C. Mitigation Measures 99 D. Monitoring and reporting 100 10. CONCLUSIONS 122 ANNEX 1: INDIGENOUS OR POSSIBLY INDIGENOUS PLANT SPECIES OF TUVALU 123 i ANNEX 2: PLANTS OF POSSIBLE ABORIGINAL ORIGIN 127 ANNEX 3: LIST OF STAKEHOLDERS/COMMUNITIES CONSULTED 128 ANNEX 4: TEMPLATE FOR DOCUMENTATION OF PUBLIC CONSULTATIONS 132 ii Figures Figure 1.1: Map showing the location of Tuvalu its islands 2 Figure 3.1: Proposed project sites in Tuvalu 10 Figure 3.2: Location of project site in Nukulaelae 11 Figure 3.3: Nukulaelae site overview 11 Figure 3.4: Location of project site in Nukufetau 12 Figure 3.5: Nukufetau site overview 13 Figure 3.6: Location of project site in Nui 14 Figure 3.7: Nui site overview 14 Figure 3.8: Rooftop solar and BESS locations 16 Figure 4.1: Satellite (Google Earth) images of Nui, Nukufetau, Nukulaelae and Funafuti 24 Figure 4.2: Mean annual cycle of wave height (grey) and wave direction (blue) at Funafuti. (Source: Australian Government (2015) Current and Future Climate of Tuvalu. Report for the Pacific-Australia Climate Change Science and Adaptation Planning Program). 26 Figure 4.3: Cross-section of an atoll in Tuvalu showing common coastal erosional processes (Source: Ministry of Natural Resources, Environment, Agriculture and Lands (2007) Tuvalu’s National Adaptation Programme of Action). 27 Figure 4.4: Seasonal rainfall and temperature in Funafuti 29 Figure 4.5: Average positions of major climate features during Tuvalu’s wet season (November to April) (Source: Australian Government (2015) Current and Future Climate of Tuvalu. Report for the Pacific-Australia Climate Change Science and Adaptation Planning Program) 29 Figure 4.6: Occurrence of tropical cyclones that developed within or crossed the Tuvalu Exclusive Economic Zone per season between 1969 - 2010. A 11-year moving average is shown by the blue line. 30 Figure 4.7: Location of protected areas (red line) on Nui, Nukufetau, Nukulaelae and Funafuti (Source: UNEP-WCMC (2019). Protected Area Profile for Tuvalu from the World Database of Protected Areas, February 2019. Available at: www.protectedplanet.net.) 51 Figure 4.8: Marine habitat types of Nukufetau42 53 Figure 18: Flow chart of the GRM 96 iii Tables Table 2.1: International Conventions and Treaties 6 Table 3.1: Solar expansion on Nukulaelae, Nukufetau and Nui (subprojects 1a to 1c) 9 Table 3.2: Estimated contractor team size and timeframe for each site 18 Table 3.3: Proposed project schedule for implementation of projects for Outer Islands and Funafuti 19 Table 4.1: Tidal Range (2019) for Funafuti, Tuvalu 25 Table 4.2: Changes in land area from 1971-2014 for Nui, Nukufetau, Nukulaelae and Funafuti18 28 Table 4.3: Estimated areas of different land use/land cover types present in Tuvalu 36 Table 4.4: Approximate number (and % of total) of native and introduced flora species in Tuvalu 37 Table 4.5: Known and potential invasive weed species in Tuvalu 38 Table 4.6: Culturally important plant categories in Tuvalu 39 Table 4.7: Known invasive fauna species in Tuvalu 41 Table 4.8: Migratory, non-migratory breeding birds and threatened birds of Tuvalu (source: Birdlife International, IUCN, Watling 2001), 45 Table 4.9: Threatened and endemic reptiles of Tuvalu (source: IUCN) 47 Table 4.10: Endemic invertebrates of Tuvalu (source: IUCN)39 48 Table 4.11: Protected areas of Tuvalu as of 2011 49 Table 4.12: Reef habitat of Nukufetau42 52 Table 4.13: Threatened marine species of Tuvalu and their potential to occur at the proposed Nukufetau Solar PV project site (source: IUCN) 57 Table 4.14: Population of Tuvalu by Island 66 Table 4.15 Resident population of villages >100 residents on Nui, Nukufetau, Nukulaelae and Funafuti 67 Table 4.16: Household income sources in Tuvalu 70 Table 4.17: Household expenditure in Tuvalu 70 Table 4.18: Level of Unemployment in 2012 72 Table 4.19: Electricity generation and diesel fuel consumption for Funafuti and Outer islands in 2015 74 Table 4.20: Examples of tangible cultural heritage sites on Tuvalu 77 Table 7.1: Summary of stakeholder meetings 92 Table9.1: Organisational environmental responsibilities 97 Table 9.2: Environmental Management and Monitoring Plan 102 iv ABBREVIATIONS AC Alternating current ADB Asian Development Bank BSAP Biodiversity Strategy and Action Plan BESS Battery Energy Storage System CCP Communications and consultation plan (for the project) CEMP Construction Environmental Management Plan CITES Convention on International Trade in Endangered Species of Wild Fauna and Flora DC Direct current DoE Department of Environment DDR Due diligence report EEZ Exclusive Economic Zone EHSG Environmental, Health, and Safety Guidelines (of the World Bank Group) EIA Environmental Impact Assessment EMP Environmental Management Plan ENSO El Niño Southern Oscillation EPA Environmental Protection Authority ESCR Environmental and Social Complaints Register GDP Gross Domestic Product GFP Grievance Focal Point GHG Greenhouse gas GoT Government of Tuvalu GRC Grievance Redress Committee GRM Grievance Redress Mechanism ha Hectare IBA Important Bird and Biodiversity Areas IEE Initial Environmental Examination IUCN International Union for Conservation of Nature kW Kilowatt kWp Kilowatt peak MFED Ministry of Finance and Economic Development (Executing Agency) MPUI Ministry of Public Utilities and Infrastructure MW Megawatt MWp Megawatt peak OHS Occupational health and safety PPE Personal Protective Equipment PREIF Pacific Renewable Energy Investment Facility PV Photovoltaic SPS Safeguard Policy Statement 2009 (of ADB) SPREP Secretariat of the Pacific Regional Environment Programme TEC Tuvalu Electricity Corporation (Implementing Agency) UNESCO United Nations Educational, Scientific and Cultural Organization CURRENCY EQUIVALENTS Tuvalu uses the Australia dollar (AUD$) - as at January 2019 AU$1.00 = US$0.716 v US$1.00 = AU$1.397 vi EXECUTIVE SUMMARY The project. The Pacific Renewable Energy Investment Facility (PREIF) will administer a grant from the Asian Development Bank (ADB) for Tuvalu: Increasing Access to Renewable Energy (the project). The project will include subprojects on Nukulaelae, Nukufetau, Nui and Funafuti to continue the PREIF’s aim of transitioning electricity generation from diesel to sustainable renewable energy generation sources. Hybrid power systems were installed on Nukulaelae, Nukufetau and Nui in 2015 via a European Union (EU) funded project. The subprojects identified as part of this project will expand the existing hybrid power stations by installing additional solar capacity, thereby increasing the renewable energy contribution from approximately 60 - 70% to more than 90%. The subprojects will also increase flood resilience by replacing the existing diesel powerhouse on Nukulaelae and upgrading distribution system pillar boxes on all outer islands as well as improving power system monitoring and communication. The subprojects on Funafuti will install additional solar and a new battery energy storage system (BESS) to increase the renewable energy contribution. The renewable energy contribution is expected to increase from approximately 16% to 32% as a result of these subprojects. The Funafuti subprojects also include a control system to better manage power system and allow greater renewable energy penetration as well as improved communications between distributed generation sources. The subprojects will assist Tuvalu meet the objectives of its National Energy Policy (2009) as well as its goal of achieving 100% renewable energy by 2025 as articulated in the "Enetise Tutumau" - the Master Plan for Renewable Electricity and Energy Efficiency in Tuvalu. Implementation arrangements. The Ministry of Finance and Economic Development (MFED) will be the executing agency for the project and the Tuvalu Electricity Corporation (TEC) will be the implementing agency