34476-013: Gansu Clean Energy Development Project

Project Data Sheet (PDS): Details


Description

The main objective of the Project is the improved environment in the Zhangye city. The Project targets the Hexi grid in terms of electricity provision, and the townships of Xishui, Huazhai, and Anyang for rural electrification. The Project also aims to provide support for institutional strengthening in implementing agency. The Project consists mainly of (i) a 102 MW run-of-river Xiaogushan Hydropower Plant; (ii) two 35 kV line to improve rural electrification; and (iii) institutional strengthening.

Project Rationale and Linkage to Country/Regional Strategy

Coal-fired thermal power plants are the main source of energy. Gansu province is developing several clean energy development initiatives, covering the full spectrum of renewable energy technologies. However, clean energy production remains unevenly distributed in the Province. Zhangye city, which is about 600 km from the provincial capital of Lanzhou, experiences frequent interruptions and shortages in electricity supply. The Zhangye city electric network is part of the Hexi corridor network which in turn is a part of the Gansu and North-west power network. The installed capacity in Zhangye city and in the Hexi grid is too small to meet the current peak load demand and most of the power stations are small in size. In 2001, the Zhangye network had load-shedding for 1,975 gigawatt-hour (equivalent to 3,198 megawatt hours of unserved energy). The current installed capacity in Zhangye is 94.5MW whereas peak demand is almost 200MW. The Hexi corridor grid has installed capacity of 475MW against its peak demand of 850MW. Zhangye city is importing more than 80% of its electricity demand of about 900 million kilowatt hours from the Hexi corridor network. The power situation in Zhangye city is expected to become worse as projected electricity demand is increasing but no new generating plants are expected to become operational. Power shortage is a key inhibiting factor for economic development of the area. Zhangye city's 2000 total population was 1,257,600 of which 983,206 are classified as rural. Of the rural population, 269,452 or 27.4% fell under the provincial rural poverty line of CNY 1,100. The Project has been designed to address these issues. Hydropower development and rural electrification can increase power generation, improve the efficiency and reliability of supply of electric power, and improve environmental quality. These will reduce poverty directly and indirectly and accelerate economic growth. To maximize the poverty reduction impacts of the resulting increase in generation and improvement in energy efficiency and reliability, the improvement of social services will be included to achieve an integrated approach to poverty reduction. The Project is consistent with the 10th Five-Year Plan which calls for clean energy in energy sector restructuring, and the Government's plan to accelerate economic development of Zhangye city by providing reliable electricity supply to local agriculture and cottage industry sectors, and to reinforce the power availability and reliability in the electricity grid.

Safeguard Categories

Environment: A
Involuntary Resettlement:
Indigenous Peoples:

Summary of Environmental and Social Aspects

The environmental impact assessment (EIA) were prepared and approved by ADB and State Environment Protection Agency (SEPA). The Project will improve the efficiency and reliability of the electricity supply and will have significant positive environmental impacts in terms of avoided air pollution from alternative energy sources. The avoided emissions were estimated at a yearly average of 240 tons, 1,910 tons, 1,500 tons, and 366,000 tons of particulate matter, sulfur dioxide, nitrogen oxides, and carbon dioxide, respectively. The negative environmental impacts are minimal and can be mitigated. The improved reliability of electricity in the project area, ecosystem rehabilitation and expansion, and economic and social improvements will enhance the net environmental benefits from the Project. Semi-annual environmental monitoring reports are being submitted to ADB on time. The Project construction will have minor and very localized impacts on two villages in Xishui township. The Project will permanently occupy 28 hectares (ha) of land, most of which is wasteland and about 10 ha is grassland. Only two households (17 people) will be affected by permanent loss of grassland rights, animal sheds, or trees, for which compensation has already been paid. The Project will also temporarily occupy 26.7 ha (mostly wasteland and some grassland) for construction camps, borrow areas, spoil areas, and temporary work areas. Four households (12 people) will be compensated for temporary losses. A short resettlement plan has been prepared by XHC. The resettlement monitoring reports are being submitted to ADB. A Community Development Strategy and Plan (CDSP) was formulated and is under implementation.



Project Data Sheets (PDS) contain summary information on the project or program. Because the PDS is a work in progress, some information may not be included in its initial version but will be added as it becomes available. Information about proposed projects is tentative and indicative.

Project Data Sheets (PDS)

Timetable

Concept Clearance
13 Jul 2000

Fact-finding
15 Jan 2003 to 24 Jan 2003

Management Review Meeting
13 May 2003

Board Approval
05 Dec 2003

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