Uzbekistan - Tashkent Municipal Solid Waste Rehabilitation Project

Report No. PIC5014 Project Name Uzbekisatn-Tashkent Municipal Solid (+) WasteRehabilitation Project Region Europe and Central Asia Sector Environment Project ID UZPE49582 Borrower Government of Uzbekistan Implementing Agency Hokimiyat of Tashkent, Public Services Board 11 Movarounnahr St., Tashkent 700000 Tel: 7 (3712) 33-18-14 Fax: 7 (3712) 47-94-95 Environment Category B Date This PID Prepared 04/11/97 Projected Appraisal Date 10/97 Projected Board Date 12/97 Country and Sector Background 1. Objectives: The Project's overall objectives are to: (a) return the existing Municipal Solid Waste Management (MSWM) system to a satisfactory level of service; and (b) provide the technical, economic and institutional basis for its future operation and development. The Project's specific objectives are to: (a) ensure that there is adequate collection infrastructure (that is, collection bins and vehicles) to provide basic MSWM services to the residential, commercial, institutional, and industrial sectors; (b) improve the accessibility and safety of public and residential collection points; (c) upgrade existing landfill practices and operations to improve efficiency, reduce environmental risks, and mitigate land use conflicts with adjacent land uses; (d) create environmental and monitoring evaluation capacity for existing solid waste disposal facilities; (e) initiate actions to ultimately place the system on a stable financial footing to ensure full cost recovery for ongoing operations and to finance equipment replacement; (f) upgrade institutional capacity to manage the system as an independent, self-financing utility permitting privatization in the medium term; (g) investigate viability of high impact waste recovery and recycle options; and (h) develop a strategic plan for the system's future development, including identification of major capital facility requirements and business structure options for the system's financing and operation. Description 2. The project is aimed at restoring basic municipal solid waste (MSW) collection and disposal capacity in the Hokimiyat (Municipality) of Tashkent. While well operated, the MSW management (MSWM) system has deteriorated in recent years due to lack of  financing with an associated decline in service. The project's investment component covers: acquisition of collection infrastructure in the form of communal bins; upgrading of collection points; renewal of the collection vehicle fleet; re- equipping of vehicle service capacity; upgrading of landfill equipment and operating practices; and establishment of environmental monitoring and evaluation capacity. In addition, the project provides for the preparation of a Strategic MSWM Plan to address the future needs of the system once it is restored to a basic level of service. The plan will address waste recovery and recycling, hazardous and biomedical waste management options, future waste processing and disposal alternatives, institutional development, and ongoing improvement in collection capacity. Finally, the project includes a technical assistance component that addresses the development of institutional capacity in the management, organization, and regulation of the system; training in modern landfill operations; and development of community awareness and consultation capacity. Financing 3. The overall project cost is estimated to be US$48 million. Funds will be provided by loans from IBRD and EBRD in equal amounts of US$18 million, and a Government contribution of US$12 million. The debt financing from IBRD is being proposed on the following terms: single currency, LIBOR-based, 5 year grace period, and 20 years maturity. On-lending arrangements will be made with the Hokimiyat of Tashkent and are proposed to involve a combination of equity contribution and loan on a shorter term than the Bank's loan. Implementation 4. The present MSWM system is operated by the Hokimiyat (City) of Tashkent through the Public Services Board (PBS) which supervises a Hokimiyat-owned collection enterprise (Spetstrans) and eleven district collection enterprises. Project implementation will be overseen by PSB, which will provide three new staff positions within PSB's present financial administration unit for purposes of administering the procurement and disbursement functions. Each component and sub-component will be implemented by Spetstrans and the district collection enterprises. Sustainability 5. Project sustainability is principally dependent on the establishment and maintenance of a stable financial and institutional structure for the operation of the MSWM system. This is being addressed in the Project's preparation by obtaining Borrower commitments to implementing substantial domestic tariff increases (already initiated), transferring existing revenues to the operation of the MSWM system and initial restructuring prior to appraisal. Project design addresses this issue by providing directed technical assistance, institutional strengthening and training within the Project such that ultimately a fully self- -2 -  financing system will evolve. The main emphasis of this assistance will be directed at ensuring the enactment of a tariff policy geared to achieving full cost recovery and institutional change toward a fully corporatized structure with possible private sector participation. In outlining a tariff policy, care will be given to achieving equity in the tariff structure by incorporating the results of the social assessment related to willingness-to-pay, affordability, and public support. It will also ensure that there is an appropriate balance of tariff levels and revenue dependence across the various waste generating sectors, and that reliable mechanisms for ensuring timely payment for services are in place. Lessons learned from past operations in the country/sector 6. Based on experience from past operations in Uzbekistan and the solid waste sector, the key factors influencing project success are anticipated to be: (a) strong local counterparts; (b) early establishment of effective implementation capacity; (c) local involvement and input; (d) clear institutional structure and responsibility; (e) selection of appropriate technology; and (f) development of sustainable cost recovery mechanisms. The project design addresses these in the following ways. The Bank's counterparts have a proven track record in the sector, clear authority for project implementation, and existing technical and administrative capacity. This capacity, however, will expanded and enhanced with respect to procurement and disbursement through early training, development of bidding documents by appraisal, and ongoing advisory assistance. Local technical and social assessment experts have provided key inputs to project design, the latter having been particularly important in ensuring that public concerns are incorporated. The key issue of the MSWM system's financial sustainability is being addressed by requiring action on tariff increases, revenue transfers, and institutional reform in advance of project appraisal, as well as providing technical assistance resources to improve financial management capacity and develop a self-financing utility structure. Technical risks will be limited due to the utilization of conventional MSW technology with which the beneficiaries are familiar. At the same time, the development of a strategic MSWM plan will establish the basic for the long-term development of the system plan. Poverty Category 7. Not Applicable Environmental Aspects 8. The Project itself does not have any major environmental issues associated with its implementation. Nonetheless, it will improve the environmental performance of the existing MSWM system. Specific environmental issues to be addressed are: (a) environmental risks associated with existing landfill operations; (b) co-disposal of hazardous and biomedical waste with MSW; (c) poor health conditions at collection points in the city; (d) local burning of MSW in residential areas; and (e) hydrocarbon - 3 -  contamination at vehicle service operations. The project provides for the development of environmental monitoring capacity for application in existing landfill operations and vehicle service facilities. The project also will support improved landfill operating and closure practices to improve environmental performance at existing landfills as well as assist in mitigating land use conflicts between the landfill and neighboring residential development. Finally, the project also will improve local environmental and sanitary conditions by providing for substantial improvements in the utility and accessibility of collection points. Program Objective Categories 9. The Project would support the transition process through policy reforms and institutional restructuring of entities involved in solid waste collection and disposal in the major urban area of Uzbekistan. The current structure for the financing, management and operation of the MSWM system is recognized as being deficient and Government strategy is directed to its evolution into an independent, self-financing utility with long term potential for privatization opportunities. This is evidenced by initiation of the corporatization of two district collection organization on a trial basis by May 1997. The ability to complete this will be dependent on the restoration of service capacity and financial stability over the transition period. The inability of the present MSWM system to sustain itself is reflective of tariff structures and revenue transfer mechanisms that do not cover the cost of operation and normal replacement of equipment and infrastructure necessary to maintain service levels. In addition, the high level of accounts receivable indicates inadequacy of collection mechanisms. Recent initiatives by the Hokimiyat to raise residential tariffs and dedicate user oriented taxes represent overdue actions for putting the system on a more secure financial basis, which would make it suitable for private sector participation. Contact Point: Roger Batstone, Task Manager The World Bank 1818 H Street N.W. Washington, D.C. 20433 Telephone No.: (202) 473-3116 Fax No.: (202) 477-3285 Note: This is information on an evolving project. Certain components may not necessarily be included in the final project. Processed by the Public Information Center week ending April 25, 1997. - 4 -  ANNEX ENVIRONMENTAL ASSESSMENT BACKGROUND 1. The Tashkent municipal solid waste management (MSWM) system encompasses the collection and disposal of MSW from residential, commercial, institutional, and industrial sources; street cleaning; and collection and disposal of landscaping waste. MSW is collected at a large variety of points, either in pre-positioned bins or, in their absence, at open waste piles. A variety of collection vehicles are used, with compactor trucks and open dump trucks predominating. Each district collection enterpriseoperates truck parks and maintenance facilities. Disposal occurs at three landfills: one on the north side of the city (Xansanbay Landfill), one on the south west side of the city (Zangiata Landfill), and one approximately 30 kilometers south of the city (Achangaranskoe Highway Landfill). In addition, there is an inactive bio-thermal and incineration waste processing facility adjacent to the Zangiata Landfill. 2. The actual volumes handled by the system in 1996 was estimated to be 1.5 million tons, of which 750,000 tons were generated by residential and commercial sources, 400,000 tons were generated by institutional (budget organizations) sources, and 350,000 tons were generated by industrial sources. Of the industrial and institutional waste, 710,000 tons were collected by Spetstrans and 40,000 tons were collected by private carriers for disposal in the municipal landfills. A seasonal variation in waste volumes of approximately 25 percent occurs between summer and winter. While evidence of illegal or random dumping is limited, this activity is increasing. 3. The basic collection system is functional but rapidly deteriorating. Collection points are poorly maintained; often lack serviceable bins; and have limited accessibility to users, particularly children who often are responsible for taking out household garbage. A shortage of bins is resulting in uncontained waste being left for collection. Collection frequency is also declining due to limited vehicle availability. Consequently, public confidence in the system has dropped, resulting in increased random dumping and local burning of uncollected waste. 4. The system's three landfill facilities are estimated to have the following remaining life at the present rate of utilization: (a) Xansanbay Landfill - 6 to 7 years, (b) Zangiata Landfill - 3 years, and (c) Achangaranskoe Highway Landfill - 20 years. Operationally, all require upgrading, in terms of both equipment and operating practices. None utilize appropriate covering practices or maintain long high open tipping faces. Compaction is limited to that achieved by bulldozer leveling activities. While all have secure, controlled access and record incoming material by load, there is no scaling or regular inspection of incoming loads. In addition, they all operate during daylight hours; have full - 5 -  security; and receive a variety of industrial and biomedical wastes, including materials normally classed as hazardous. 5. Both the Xansanbay Landfill and Achangaranskoe Highway Landfill appear to have good natural hydrogeological barriers and are unlikely to pose significant threats to ground water quality. The latter also has monitoring wells. The Zangiata Landfill, however, is located in a ravine system containing an active surface water course, sandy overburden, and associated wet lands. Consequently, it is likely to be causing negative impacts on both surface and ground water quality. Landfill gas emissions appear to occur in all sites in moderate amounts; surface fires are common but not extensive. Active fire suppression using trucked water is practiced. The Zangiata Landfill is surrounded by industrial, commercial, and agricultural development with reasonable buffers to adjacent development. Similarly, the Achangaranskoe Highway Landfill is located in an agricultural area with no immediate residential conflicts. The Xansanbay Landfill site, however, has residential development immediately adjacent on two sides and direct conflict with ad hoc agricultural and commercial activity within the area of future filling. PROJECT SCOPE 6. The project is aimed at the restoration of Tashkent's basic MSW collection and disposal capacity. The project's investment component covers: (a) the acquisition of collection infrastructure in the form of communal bins, upgrading of collection points, renewal of the collection vehicle fleet, and re-equipping of vehicle service capacity; (b) the upgrading of landfill equipment and operating practices; and (c) the establishment of environmental monitoring and evaluation capacity. In addition, the project provides for a strategic MSWM Plan to address the future needs of the system once it is restored to a basic level of service. The plan will address waste recovery and recycling, hazardous and biomedical waste management options, future waste processing and disposal alternatives, institutional development, and ongoing improvement in collection capacity. Finally, the project includes a technical assistance component that addresses the development of institutional capacity in the management, organization, and regulation of the system; training in modern landfill operations; and development of community awareness and consultation capacity. ENVIRONMENTAL ISSUES 7. The Project does not having any environmental issues associated with its implementation except an increase in energy consumption and associated air quality impacts resulting from increased vehicle use as a consequence of improved service capacity. Nonetheless, one of the primary objectives of the Project is to improve the environmental performance of the present MSWM system with respect to the following environmental issues: (a) environmental risks associated with existing landfill operations; (b) co-disposal of hazardous and biomedical waste with MSW; (c) improving health conditions at collection points in the city; (d) - 6 -  local burning of MSW in residential areas; and (e) hydrocarbon contamination at vehicle service operations. The strategic waste management plan component will also have to address a range of environmental issues in the evaluation of future waste management facility development options and approaches. These options and approaches include setting priorities for closing existing landfills, siting new landfills, assessing the environmental impacts of waste processing alternatives such as incineration, and evaluating the net environmental benefits of waste recycling opportunities. ENVIRONMENTAL MITIGATION 8. The Project provides for the development of environmental monitoring capacity, including equipment and training within the MSW system operational organization. This will have immediate application in existing landfill operations and vehicle service facilities. Environmental performance of existing landfills will be improved by the adoption of modern practices associated with cover and minimization of operational areas, and by the inclusion of capacity to initiate closure measures on large areas already utilized. This will be specifically designed to mitigate land use conflicts with neighboring residential development. The project design also provides for substantial improvement in the utility and accessibility of collection points which will improve local environmental and sanitary conditions. 9. A significant factor in the project's design has been the input of the general public through a social assessment undertaken during project preparation. The assessment involved a local expert group and consultation with a wide range of stakeholders, including: a broad cross-section of the general public, residents adjacent to landfill facilities, commercial and industrial users of the system, regulatory authorities, and NGOs. All stakeholders, particularly residential users of the system, attach a high priority to improving the system in both environmental and social terms. As a result, environmental performance improvement and responsiveness to public concern for the issue are considered key monitoring indicators. To this end, the inclusion of continued environmental analysis and follow up social assessments will be required as part of project implementation. - 7-