China - Heat Reform and Building Energy Efficiency (GEF) Project

INTEGRATED SAFEGUARDS DATA SHEET CONCEPT STAGE Report No.: AC614 Date ISDS Prepared/Updated: I. BASIC INFORMATION A. Basic Project Data 0 Counltry: China | Project ID: P072721 Project Name: CN-GEF-Heat Reform & Task Team Leader: Robert P. Taylor GEF Focal Area: 1 11 Global Supplemental ID: Estimated Appraisal Date: November 30, Estimated Board Date: March 8, 2005 2004 Managing Unit: EASEG Lending Instrument: GEF Grant Sector: District heating and energy Theme: Climate change (P);Small and efficiency services (100%) medium enterprise support (S) Safeguard Policies Specialists in the task team: Youxuan Zhu, Bekir Onursal Loan/Credit amount ($m.): Other financing amounts by source: ($m) GLOBAL ENVIRONMENT FACILITY 18 B. Project Objectives [from section 3 of PCNJ The objective of the proposed project is to achieve sustained and growing increases in energy efficiency in residential buildings in China's cold and severe cold regions and in the heating systems which supply them. C. Project Description [from section 4 of PCNJ The proposed GEF project is the focal point of a broader heat reform and building energy efficiency program involving World Bank assistance. The other main part of this program is a series of World Bank policy studies, primarily on implementation options for heat reform. The program could also involve additional donor support and is coordinated with ongoing international assistance mobilized by the Government to support its heat reforrm and building energy efficiency program. The proposed project is a national-level project, including three components: (a) a large demonstration project in Tianjin Municipality, integrating development of modern, variable flow heat supply systems. construction of highly energy efficient residential buildings, and implementation of comprehensive heat billing and pricing reforms; (b) national-level coordination and policy support; and (c) phased-in heating system and building energy efficiency investments and reform activities in other northern Chinese cities, to be identified and developed as project preparation and implementation for the first two components proceed.  D. Project location (if known) The focus of the project is to implement comprehensive programs in 4-7 northem Chinese cities. Tianjin municipality, where a large, integrated demonstration project is being prepared, is a city of provincial rank located 150 km southeast of Beijing. The demonstration project involves partial financing of energy efficiency equipment to be incorporated within two housing developments, and associated heating facilities within the Municipality. E. Borrower's Institutional Capacity for Safeguard Policies [from PCNJ Since all project sites are not known, the borrower will prepare, with Bank assistance, a framework for screening projects for safeguard policies that may apply. The Tianjin component is being coordinated by a project management office which is managing other Bank projects and has gained experience in resettlement and environmental analysis. II. SAFEGUARD POLICIES THAT MIGHT APPLY Applicable? Safeguard Policy pp ______e. If Applicable, How Might It Apply? [ Y] Environmental Assessment (OP/PB 4.01) The GEF will finance a portion of the incremental costs of energy efficiency measures and equipment in housing developments and their associated heating plants and systems. These housing complexes and heating systems, which involve investments of about 100 times the level of GEF incremental cost financing, have been planned and will proceed regardless of Bank and GEF involvement following Chinese environmental protection regulations. Strictly speaking, such GEF-financed parts of the project are not linked to the broader housing development projects, as defined under the safeguards policies. For subprojects where GEF project financing is proposed only in support for incremental energy efficiency equipment and installation investments, EIAs based on Bank regulations for the full housing development projects and associated heating infrastructure will not be required. However, environmental impact reports on these broader investments must be submitted by the project developers to the Bank for due- diligence review and approval. These reports must include definition of the main environmental impacts, evidence that all applicable Chinese regulations have been followed, and description of, and mitigation measures taken against, any potential environmental risks. In addition, simple environmental impact analysis should be completed for the energy efficiency investments to be financed by the project, as part of the above subproject impact reporting. Finally, a Project Environmental Policy Framework will be prepared by the Grant Recipient, and should be approved by the Bank before the completion of project appraisal. This Framework will present a screening procedure to determine if Bank EA policies apply to given future subprojects, the nature of EIAs to be prepared for any possible investments for which EA policies are triggered, and the nature of environmental impact reports for the Bank's due diligence review for investments which are not directly linked, as defined under the safeguards policies of the Bank, to the project-financed investments. I NJ Natural Habitats (OP/HP 4.04) The project will not finance activities that would significantly convert or degrade any protected areas, known natural habitats, or established or proposed critical natural habitats as defined under the safeguards policy. The project EIA and subproject .___.__L_ screening mechanisms will ensure that subprojects that impact natural habitats are  identified. No subprojects that adversely affect critical natural habitats will be supported under the project. [NI Pest Management (OP 4.09) The project will not procure any pesticides nor will an increased use of pesticides result from the project. [VI Y Involuntary Resettlement (QP/BP 4.12) The GEF will finance a portion of the incremental costs of energy efficiency measures and equipment in housing developments and their associated heating plants and systems. These housing complexes and heating systems, which involve investments of about 100 times the level of GEF incremental cost financing, have been planned and will proceed regardless of Bank and GEF involvement following Chinese environmental protection regulations. Strictly speaking, such GEF-financed parts of the project are not linked to the broader housing development projects, as defined under the safeguards policies. For subprojects where GEF project financing is proposed only in support for incremental energy efficiency equipment and installation investments, RAPs based on Bank regulations for the full housing development projects and associated heating infrastructure will not be required. However, social impact reports on these broader investments must be submitted by the project developers to the Bank for due-diligence review and approval. These reports must include definition of the main social impacts of any associated resettlement or land acquisition, evidence that all applicable Chinese regulations have been followed, and description of, and mitigation measures taken against, any potential risks. Finally, a Project Social Safeguard Framework will be prepared by the Grant Recipient, and should be approved by the Bank before the completion of project appraisal. This Framework will present a screening procedure to determine if Bank resettlement or indigenous peoples' policies apply to given future subprojects, the nature of RAPs and/or I's to be prepared for any possible investments for which social safeguard policies are triggered, and the nature of social impact reports for the Bank's due diligence review for investments which are not directly linked, as defined under the safeguards policies of the Bank, to the project-financed investments. [NJ Indi2enous Peoples (OD 4.20) There are no Indigenous Peoples (IP) communities, as defined in the policies, located in the Tianjin Component project area. Under the Other Northern Cities Component, the Social Impact Reports descriped above would evaluate whether the subprojects affect Indigenous Peoples as defined under the policy. In the event that IPs are present at these sites, appropriate IP plans will need to be developed, and must be reviewed and approved by the Bank. [ Nl Forests (OP/BP 4.36) The project will not finance activities that would involve significant conversion or degradation of critical forest areas or related critical natural habitats as defined under the policy. [ NJ Safety of Dams (OP/BP 4.37) The project will not finance construction or rehabilitation of any large dams as defined under this policy. [ NI Cultural Property (draft OP 4.11 - OPN 11.03) .___________ It is highly unlikely that the land under the Tianjin Component will contain sites having  archeological, paleontological, historical, religious or unique natural values as defined under the OPN. Under the Other Northem Cities Component, a screening mechanism will be incorporated into the Social Safeguards Framework to include the identification of culturally significant sites, as defined under the OPN, and determine if project activities will adversely affect them. Discussions in all subproject areas with local antiquities bureaus will be held and appropriate clauses will be included in construction contracts regarding procedures to be followed in the event of chance finds of culturally significant sites. [ NJ Projects in Disputed Areas (OPIBP/GP 7.60) The project is not located in any known disputed areas as defined under the policy. [ NJ Projects on International Waterwavs (OPBP/GP 7.50) There are no known project components involving international waterways as defined under the policy. Environmental Assessment Category: [ ] A [ X] B [] C [ J FI [ ] TBD (to be deterrnined) III. SAFEGUARI) PREPARATION PLAN For this simple project, which twill not require a QER, the target date for preparing the PAD- stage ISDS is November 18, 2004. The environment and social impact reports for the subprojects to be appraised before board presentation, and project environment and social safeguards frameworks also will be completed by then. Unless there are changes in the project scope or design, the EASEG Sector Manager will issue the safeguards compliance note, following review of the above documentation and following the project Decision Meeting planned for about November 25. IV. APPROVALS Signed and submitted by: qe ?AQCLJ Task Team Leader: Robert P. Taylor \AYV. &