China - Second Energy Conservation (GEF) Project

Report No. 23642 Report No: I067337 <--Please check for duplicates! Integrated Safeguards Data Sheet (Initial) Date ISDS Prepared/Updated: 02/12/2002 Section I - Basic Information A. Basic Project Data Country: CHINA Project ID: P067337 Project: GEF Energy Conservation II Task Team Leader: Robert P. Taylor Authorized to Appraise Date: April 1, 2002 IBRD Amount ($m): Bank Approval: June 18, 2002 IDA Amount ($m): Managing Unit: EASEG Sector: PY - Other Power & Energy Conversion Lending Instrument: Financial Intermediary Loan (FIL) Status: Lending I.A.2. Project Objectives: The objective of the proposed project is to expand domestic investment in energy efficiency projects through the aggressive development of China's nascent Energy Management Company (EMC) industry, thereby achieving large-scale energy efficiency improvements and associated reductions in the growth of carbon dioxide emissions and other pollutants. The EMC concept has been successfully demonstrated under Chinese conditions by three large pilot EMCs established in 1997 and developed under the ongoing EC/GEF/IBRD China Energy Conservation Project. Other EMCs are now endeavoring to emerge, and interest in developing this type of business in China is running high. To foster the broad development of an EMC industry in China quickly will require (a) the introduction and growing participation of China's domestic banks in the business, as the primary source of credit, and (b) massive dissemination of the concept and experiences achieved, supported also with practical technical assistance and operationally-focused training for emerging new EMCs. This project seeks to meet these requirements. I.A.3. Project Description: Components: EMC Guarantee Programs EMC Services The proposed project includes a TA component and a financial intermediary component. The EMC Service Component aims to provide in-depth, practical technical assistance to new and emerging EMCs on development of their businesses. In a complementary EMC Loan Guarantee Program, GEF funds will back partial credit guarantees to Chinese banks, assisting them to provide loan financing to new emerging EMCs, so they can develop their businesses. I.A.4. Project Location: (Geographic location, information about the key environmental and social characteristics of the area and population likely to be affected, and proximity to any protected areas, or sites or critical  natural habitats, or any other culturally or socially sensitive areas.) National B. Check Environmental Classification: F (Financial Intermediary Assessment) Comments: This financial intermediation project will result in major positive impacts on the environment, in terms of improved energy efficiency, reduced air pollution, and reduce greenhouse gas emissions. No major adverse environmental issues are associated with the project. The loan guarantee program will indirectly support hundreds of small subprojects, which will be identified during project implementation. Few, if any, will involve any negative environmental or safety issues. C. Safeguard Policies Triggered Policy Applicability Environmental Assessment (OP/BP/GP 4.01) No Forestry (OP/GP 4.36) No Natural Habitats (OP/BP 4.04) No Safety of Dams (OP/BP 4.37) No Pest Management (OP 4.09) No Involuntary Resettlement (OP/BP 4.12) No Indigenous Peoples (OD 4.20) No Cultural Property (OP 4.11) No Projects in Disputed Territories (OP/BP/GP 7.60)* No Projects in International Waterways (OP/BP/GP 7.50) No *By supporting the proposed project, the Bank does not intend to prejudice the final determination of the parties' claims on the disputed areas Section II - Key Safeguard Issues and Their Management D. Summary of Key Safeguard Issues. Please fill in all relevant questions. If information is not available, describe steps to be taken to obtain necessary data. II.D.la. Describe any safeguard issues and impacts associated with the proposed project. Identify and describe any potential large scale, significant and/or irreversible impacts. No social hardships are anticipated as a result of the project, which will support relatively minor industrial and commercial building energy conservation retrofits and equipment renovation. No sub-projects will involve physical resettlement. The project will not affect indigenous people. II.D.lb. Describe any potential cumulative impacts due to application of more than one safeguard policy or due to multiple project component. II.D.lc Describe any potential long term impacts due to anticipated future activities in the project area. II.D.2. In light of 1, describe the proposed treatment of alternatives (if required) To ensure proper management of any potential negative environmental issues in any of the hundreds of subprojects undertaken by EMCs with domestic loans partially guaranteed with GEF funds, it is proposed to include requirements that loan guarantee packages from participating banks and -2 -  EMCs include certifications from the EMCs that (i) no projects supported by the guarantee loan will yield any negative environment impacts, or (ii) any projects identified with any potential negative environmental impacts will be implemented according an environmental management plan (EMP) approved by the local Environmental Protection Bureau. The Guarantee Company will provide the Banks and EMCs with a list of potentially adverse environmental impacts to consider, for use in this certification procedure. A negative list which would include the "type of facilities or activities" this project would not support may be developed to provide guidance to EMCs. The Bank will periodically audit a representative sample of sub-projects to ensure that appropriate review procedures are in place and that EMP have been developed where necessary. The guidelines / procedures to be followed during project implementation would be documented in the Project Implementation Manual. II.D.3. Describe arrangement for the borrower to address safeguard issues N/A N/A II.D.4. Identify the key stakeholders and describe the mechanisms for consultation and disclosure on safeguard policies, with an emphasis on potentially affected people. Project design has included consultations with a wide range of stakeholders, in the central and local government, research, NGO, industrial, commercial and financial sectors. Through the efforts of the SETC's PMO, the emerging EMC Service Group, and the marketing staff of the proposed Guarantee Program, major efforts are being initiated to increase awareness about EMCs in general, and opportunities for project support in particular. Access to initial technical assistance will be open to any interested parties. Access to more advanced training and technical assistance also will be open and transparent, but will require a specified level of corporate development. E. Safeguards Classification. Category is determined by the highest impact in any policy. Or on basis of cumulative impacts from multiple safeguards. Whenever an individual safeguard policy is triggered the provisions of that policy apply. I S1. - Significant, cumulative and/or irreversible impacts; or significant technical and institutional risks in management of one or more safeguard areas I S2. - One or more safeguard policies are triggered, but effects are limited in their impact and are technically and institutionally manageable I S3. - No safeguard issues [XI SF. - Financial intermediary projects, social development funds, community driven development or similar projects which require a safeguard framework or programmatic approach to address safeguard issues. F. Disclosure Requirements Environmental Assessment/Analysis/Management Plan: Expected Actual Date of receipt by the Bank Date of "in-country" disclosure Date of submission to InfoShop -3-  Date of distributing the Exec. Summary of the EA to the ED (For category A projects) Resettlement Action Plan/Framework: Expected Actual Date of receipt by the Bank Date of "in-country" disclosure Date of submission to InfoShop Indigenous Peoples Development Plan/Framework: Expected Actual Date of receipt by the Bank Date of "in-country" disclosure Date of submission to InfoShop Pest Management Plan: Expected Actual Date of receipt by the Bank Date of "in-country" disclosure Date of submission to InfoShop Dam Safety Management Plan: Expected Actual Date of receipt by the Bank Date of "in-country" disclosure Date of submission to InfoShop If in-country disclosure of any of the above documents is not expected, please explain why. Signed and submitted by Name Date Task Team Leader: Robert P. Taylor Project Safeguards Specialists 1: Jitendra J. Shah/Person/World Bank Project Safeguards Specialists 2: Chaohua Zhang/Person/World Bank Project Safeguards Specialists 3: Approved by: Name Date Regional Safeguards Coordinator: Glenn S. Morgan 2/7/02 Sector Manager/Director: M. Farhandi 1/4/02 For a list of World Bank news releases on projects and reports, click here - 4 -