Environmental performance of Bank-financed coal-fired power plants in China

U~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~C ~~~~~~~~~~~~~~~~~C   Environmental Performance of Bank-Financed Coal-Fired Power Plants in China February 2000 Lanqing Jia Bernard Baratz Jack Fritz East Asia Environment and Social Development Unit   FOREWORD This report provides a comprehensive review of the environmental performance of Bank-financed coal-fired power plants in China since the mid-1980s. These results indicate that the Bank has played a catalytic role in improving the overall environmental performance of China's power sector. The report also identified issues associated with environmental assessments and implementing environmental management plans for these projects. Recommendations are provided at the end of the report. This report is a joint effort of the East Asia Environment and Social Development Sector Unit (EASES) and the East Asia Energy Sector Unit (EASEG) of the World Bank Group. The site visits were coordinated by the Bank's China Resident Mission and was well received by China State Power Corporation and its branch power companies. The team also consulted China State Environmental Protection Administration (SEPA) and related local environmental protection bureaus during site visits. The team thanks the Environmental Protection Office of the State Power Corporation, and in particular Mr. Wang Zhixuan, its Director, as well as each of the Provincial Power Corporations (Shandong, Shanghai, Zhejiang, Jiangsu and Henan) and staff of the individual plants for their hospitality and cooperation. In addition, the team thanks Nourredine Berrah, Principal Energy Specialist and Elaine Sun, Sector Coordinator for Energy in Beijing, for their support and continued encouragement. William Gillen provided editorial assistance for this report. Ms. Ma Rui arranged the site visits for the team. The team thanks them and many others for making this report possible. Zafer Ecevit Yoshihiko Sumi Sector Manager Sector Manager Environment and Social Development Energy & Mining Development Sector Sector Unit Unit East Asia and Pacific Region East Asia and Pacific Region The World Bank Group The World Bank Group . .  ABBREVIATIONS AND ACRONYMS BP Bank procedures CEM continuos environmental monitoring CO2 carbon dioxide EA environmental assessment EMP environmental monitoring (or management) plan EPBs environmental protection bureaus ESP eletrostatic precipitator FGD flue gas desulfurization GB guo biao (Chinese) meaning national standards gce gram of coal equivalent GP good practices GWh gigawatt-hour IGCC integrated gasification combined cycle kcal kilocalories kgce kilogram of coal equivalent kW kilowatt mg milligram mtce million tons of coal equivalent MW megawatt NEPRI Nanjing Environmental Protection Research Institute NM3 normal cubic meter NO, oxides of nitrogen OD operational directives OP operational policies PIC project implementation completion PM2.5 particulate whose diameter is no larger than 2.5*10-9 meters PM1o particulate whose diameter no larger than 10*10-9 meters SAR Staff Appraisal Report SDPC State Development Planning Commission of China SEPA State Environmental Protection Administration of China S sulfur SO2 sulfur dioxide SPC State Power Corporation of China tec tons of coal equivalent TSP total suspended particulate ii.i  TABLE OF CONTENTS Executive Summary .......................................................... v 1. Introduction .......................................................... 1 2. Evolution of Environmental Requirements for Thermal Power Plants ........... 7 3. Environmental Performance of World Bank-Financed Thermal Power Plants .......................................................... 14 4. Diagnosis and Recommendations ........................................................ 27 Appendices A. Overall Power Sector Performance Statistics ......................................... 34 B. Performance Summary of Bank-Financed Power Plants in China ............... 35 C. Provincial Power Survey Form Sample ................................................ 36 D. Power Plant Survey From .......................................................... 37 E. World Bank: Thermal Power Guidelines for New Power Plants ................. 43 F. World Bank: Thermal Power - Rehabilitation of Existing Plants ............... 57 G. Flue Gas Emissions Standards for Coal-Fired Power Plants (Chinese) ......... 60 iv   EXECUTIVE SUMMARY Background environmental management programs as an integral part of all project designs. Since the mid-1980s, the World Bank has assisted China in developing Objective its electric power industry, financing not only large, new thermal and hydropower The objective of this study was to plants, but also transmission and assess environmental compliance of distribution systems and renewable Bank financed coal-fired power plants in resources, as well as supporting policy China to agreed Chinese and Bank initiatives to make the energy sector environmental processes and standards. financially viable and environmentally These requirements are articulated in the sustainable. Since 1986, the Bank has Environmental Management Plans financed approximately 9,000 MW of (EMPs) which were included in the coal-fired power generation with an environmental assessments which were investment cost of approximately $ 9.4 prepared during project preparation. The billion, of which the Bank contribution team visited Beilungang, Wujing, was $ 2.9 billion. These plants were Zouxian, Yanshi, Yangzhou and Wai built to modem standards of operation Gao Qiao power plants, spending and pollution control. Over this period, approximately one to two days at each an evolution of enviromnental standards, site. guidelines and enforcement institutions has taken place both at the World Bank Overall Impressions and in China. EASES reviewed these investments from a compliance The team was well received at perspective to determine if the Bank's most plants by well prepared investments in East Asia are environmental staffs. The team felt that environmentally sound. environmental management was institutionally sustainable, supported Coal will continue to be the financially by the local power company, commercial fuel of choice in China for and supported by the local community. some time to come, with current use in The following general impressions the range of 1,100 Megatons annually, of describe the overall situation. which the power sector consumes roughly 25 percent. Based on this heavy COMPLIANCE WITH STANDARDS use of coal by the power sector it has often been thought that much of China's Most plants visited were in urban air pollution comes from local compliance with Bank environment power plants. However, research has standards as applied at the time of shown most ground level air pollution construction and initial operation. The comes from local sources. Nevertheless, more recent investments would be in over the last ten years, both China and compliance with most of the new Bank the World Bank have enacted stricter guidelines as well, primarily because performance requirements for the power they used high efficiency precipitators, sector, and modified their environmental low sulfur coals and improved design assessment procedures to require v  and operation of effluent treatment facilities (see Figure A and B). Figure A Compliance of Particulate Emissions 450.0 406.5 400.0 0 E aPM Emissions (calculated), mg/Nm3 (o 300.0 i; 0 PM Emissions g3 250.0 -0 3 0(reported), mgNrm3 L 50.0 3630 201i