Initial Environmental Examination Document stage: Final Project Number: 42229-016 May 2019 BHU: Secondary Towns Urban Development Project – Rangjung Water Supply Subproject Prepared by the Ministry of Works and Human Settlements of the Kingdom of Bhutan for the Asian Development Bank. This is a final version of the draft originally posted in March 2018 available on https://www.adb.org/sites/default/files/project-documents/42229/42229-016-iee- en.pdf This final 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. Final Initial Environmental Examination Document Stage: Final Project Number: May 2019 BHU: Secondary Towns Urban Development Project —Rangjung Water Supply Subproject Prepared by the Ministry of Works and Human Settlements of the Kingdom of Bhutan for the Asian Development Bank. CURRENCY EQUIVALENTS as of 8 May 2018) Currency unit – ngultrum (Nu) Nu1.00 = $ 0.015 $1.00 = Nu 67.147 ABBREVIATIONS ADB Asian Development Bank BDWQS Bhutan Drinking Water Quality Standards BHU Basic Health Unit BHU Bhutan CEMP Contractor Environmental Management Plan CIA Cumulative Impact Assessment DES Department of Engineering Services DHMS Department of Hydro-Meteorological Services EIA Environmental Impact Assessment EHS Environment, Health and Safety EMP Environmental Management Plan FNCA Forest and Nature Conservation Act FNCR Forest and Nature Conservation Rules FNCRR Forest and Nature Conservation Rules and Regulations GIS Geographic Information System GRC Grievance Redress Committee GRM Grievance Redress Mechanism HDPE High Density Polyethylene IEE Initial Environmental Examination IWRM Integrated Water Resource Management LAP Local Area Plan MLD Million Liters per Day MOHCA Ministry of Home and Cultural Affairs MOWHS Ministry of Works and Human Settlements Masl mean sea level MW Mega Watt NAV Notice of Alleged Violation NEC National Environmental Commission NEPA National Environment Protection Act NGOs Non-governmental Organizations NLC National Land Commission NLCS National Land Commission Secretariat NSB National Statistics Bureau OHS Occupational Health and Safety O&M Operation and Maintenance PIU Project Implementation Unit PMU Project Management Unit PMSC Project Management & Supervision Consultants PPE Personal Protective Equipment PPTA Project Preparatory Technical Assistance PSA Poverty and Social Analysis REA Rapid Environmental Assessment RCC Reinforced Cement Concrete RWSS Rural Water Supply Schemes SASEC South Asia Subregional Economic Cooperation SEMP Site-specific Environmental Management Plan SPS Safeguard Policy Statement SRF State Reserved Forest SSF Slow Sand Filter STUDP Secondary Towns Urban Development Project TA Technical Assistance ToR Terms of Reference UNFCCC United Nations Framework Convention on Climate Change VCs Valued Components WTP Water Treatment Plant WEIGHTS AND MEASURES ha – Hectare HP – Horsepower km – Kilometer lpcd – liters per capita per day lps – liter per second m – Meter m2 – square meter m3 – cubic meter mg/L – milligrams per liter mm – Millimeter MPN – most probable number NTU nephelometric turbidity unit TCU – true color unit ug/N cm – microgram per normal cubic meter NOTE In this report, "$" refers to United States dollars. 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 maybe 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. Contents Page EXECUTIVE SUMMARY I. INTRODUCTION 6 II. POLICY, LEGAL AND ADMINISTRATIVE FRAMEWORK 7 A. ADB Policy 7 B. Environmental Related Acts and Regulations of Bhutan 10 C. International Environmental Agreements 14 III. DESCRIPTION OF THE PROJECT 15 A. Location of Subproject 17 B. Components 17 IV. DESCRIPTION OF THE ENVIRONMENT 21 A. Methodology Used for the Baseline Study 21 B. Physical Resources 21 C. Geology and Geomorphology 22 D. Seismology 23 E. Soil 23 F. Topography 23 G. Hydrology 24 H. Climate 24 I. Ecological Resources 27 J. Economic Development of the Subproject Sites 30 K. Socio and Cultural Resources 34 V. ANTICIPATED IMPACTS AND MITIGATION MEASURES 36 A. Design/Pre-Construction Phase Considerations 38 B. Construction Phase Environmental Impacts 39 C. Operation Phase Environmental Impacts 43 D. Cumulative Impact Assessment 46 VI. INFORMATION DISCLOSURE, CONSULTATION, AND PARTICIPATION 48 VII. GRIEVANCE REDRESS MECHANISM 49 VIII. ENVIRONMENTAL MANAGEMENT PLAN 52 A. Environmental Mitigation 53 B. Environmental Monitoring 59 C. Implementation Arrangement 64 D. Capacity Development Program 70 IX. CONCLUSIONS AND RECOMMENDATIONS 71 List of Appendixes 1. Rapid Environmental Assessment (REA) Checklist - Trashigang 72 2. A Checklist for Preliminary Climate Risk Screening - Trashigang 76 3. Minutes of the Public Consultation for Social and Environment Safeguards and Assessment in Rangjung 77 4. Rangjung Public Clearance 79 5. List of Participants to the Rangjung Public Consultation 80 6. Photograph of Rangjung, Trashigang Public Consultation 82 7. Grievance Redress Mechanism and Grievance Redress Committee Notification 83 8. Sample Grievance Redress Form 86 9. Terms of Reference PMU Environmental Specialists 87 10. Template for Semi-Annual Environmental Monitoring Report 90 EXECUTIVE SUMMARY 1. An environmental assessment was made for the proposed water supply subprojects as part of the Secondary Towns Urban Development Project (STUDP) for three selected secondary towns in Bhutan. The water supply subprojects are located in Dewathang and Samdrup Jongkhar; Schechamthang (Ranibagan) and Sarpang Tar (Sarpang); and Trashigang, and Rangjung. This environmental assessment was accomplished through ADB TA 8551-BHU.1 2. An initial environmental examination (IEE) was carried out for the water intake and water treatment plant (WTP) rehabilitation subproject of STUDP for Rangjung. In accordance with ADB Safeguard Policy Statement (SPS), 2009, an initial screening was conducted using ADB’s rapid environmental assessment checklist for water supply. Result of the screening and assessment reveal that the subproject is unlikely to cause significant adverse environmental impact. Thus, the subproject is categorized as category B for environment as per ADB SPS, 2009.The assessment was also carried out within the policy, legal, and administrative frameworks relevant to water supply projects in Bhutan. 3. Subproject scope and description. This IEE covers the Rangjung intake and WTP rehabilitation subproject, which comprises the following components: (i) construction of one permanent reinforced cement concrete (RCC) intake; (ii) construction of grit chamber near existing collection tank; (iii) construction of ductile iron transmission main with total length of 8.16 kilometers (km); (iv) construction of eight break pressure tanks (BPTs) of which six are in current locations of exiting BPTs which will be decommissioned; (v) construction of one reservoir with capacity of 200 cubic meters (m3); (vi) installation of water supply meters; and (vii) landslide protection works. This subproject will complement another water supply subproject (Trashigang water distribution network improvement subproject) which is covered by a separate IEE. These subprojects will eventually serve the target communities in Trashigang urban area. 4. Environmental and socioeconomic conditions. Project implementation will not pose significant problems to the environment since the proposed routes of the pipelines are along the main roads parallel to the existing pipelines. Proposed sites of the intake and reservoir are in vacant lots owned by the government. Most areas immediately adjacent to the road where pipelines and transmission mains are to be laid are already occupied by residential and other structures, while areas beyond the road corridors are basically agricultural land. The sites are not within undisturbed landscapes or protected areas, but areas already inhabited by local people whose activities over the years resulted to their present residential, institutional, commercial, and agricultural land uses. 5. Environmental impacts and environmental management plan. Screening for environmental impacts is made through a review of the parameters associated with projects for water supply system against the components of the proposed subproject. An important consideration in analyzing the environmental impacts of the proposed subproject is the fact that these are improvements and expansion of existing water supply systems in an already altered environment. The issue on impacts and risks to biodiversity conservation is not applicable to the subproject since the components will not be located in areas