China, People's Republic of: Guangdong Energy Efficiency and Environment Improvement Investment Program - Project 2

Sovereign Project | 39653-033

Summary

The Project is to promote energy efficiency and environmental protection in Gungdong Province using advanced technologies, and is justified in technical, economic, and financial terms. The energy savings will result from retrofitting existing equipment with more efficient equipment, which in aggregate will reduce the need to construct and operate a conventional coal-fired power plant.

The Project will consider only retrofits of proven energy efficiency technologies in the following areas: (i) motors and motor-drive systems; (ii) transformers and reactive power compensators; (iii) lighting; (iv) heating, ventilation, and air conditioning; (v) air compressors and pumping systems; (vi) recovery of waste energy from industry; (vii) coal-fired industrial boilers and industrial cogeneration; and (viii) other related energy efficiency improvement projects.

Latest Project Documents

Project Results

 

137,505

tCO2 equivalent per year in greenhouse gas emission reduction

 

0.18

TWh equivalent per year in energy saved


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.

The Public Communications Policy (PCP) recognizes that transparency and accountability are essential to development effectiveness. It establishes the disclosure requirements for documents and information ADB produces or requires to be produced.

The Accountability Mechanism provides a forum where people adversely affected by ADB-assisted projects can voice and seek solutions to their problems and report alleged noncompliance of ADB's operational policies and procedures.

In preparing any country program or strategy, financing any project, or by making any designation of, or reference to, a particular territory or geographic area in this document, the Asian Development Bank does not intend to make any judgments as to the legal or other status of any territory or area.

Project Name Guangdong Energy Efficiency and Environment Improvement Investment Program - Project 2
Project Number 39653-033
Country China, People's Republic of
Project Status Closed
Project Type / Modality of Assistance Loan
Source of Funding / Amount
Loan 2611-PRC: Guangdong Energy Efficiency and Environment Improvement Investment Program - Project 2
Ordinary capital resources US$ 22.06 million
Strategic Agendas Environmentally sustainable growth
Inclusive economic growth
Drivers of Change
Sector / Subsector Energy - Energy sector development and institutional reform
Gender Equity and Mainstreaming
Description

The Project is to promote energy efficiency and environmental protection in Gungdong Province using advanced technologies, and is justified in technical, economic, and financial terms. The energy savings will result from retrofitting existing equipment with more efficient equipment, which in aggregate will reduce the need to construct and operate a conventional coal-fired power plant.

The Project will consider only retrofits of proven energy efficiency technologies in the following areas: (i) motors and motor-drive systems; (ii) transformers and reactive power compensators; (iii) lighting; (iv) heating, ventilation, and air conditioning; (v) air compressors and pumping systems; (vi) recovery of waste energy from industry; (vii) coal-fired industrial boilers and industrial cogeneration; and (viii) other related energy efficiency improvement projects.

The Project will have multiple benefits: (i) energy security improves as lesser new power supply capacity will be needed to meet future demand, and less coal will be used for power generation; and (ii) the local and subregional environment improves, and the contribution to global climate change is lower because of avoided coal use.

Project Rationale and Linkage to Country/Regional Strategy

Currently, PRC is one of the largest energy consumers in the world. Within its energy mix, approximately 70% of the primary energy demand is met by coal, and about 80% of electricity is generated from coal. The large share of coal-fired power generation results in serious environmental issues and accounts for about 50% of the PRC's sulfur dioxide emissions and 80% of nitrogen oxide emissions both pollutants result in acid rain that falls on one third of the country. Rapid implementation of energy conservation measures, including implementation of EPPs, will lower the burden for later addressing the consequence of carbon emissions and climate change.

Guangdong has the largest and fastest-growing economy among all the PRC provinces. Its gross domestic product (GDP) has grown at 14% per annum since 1995. Electricity consumption is dominated by energy-intensive heavy industries, with the industry and manufacturing sectors combined representing about 73% of total electricity use. The province has relatively low natural resource endowments. It imports 100% of coal requirements and 80% of oil needs; approximately 20% of electricity is imported from other provinces. The demand for power has outpaced supply and power shortages have been experienced during the summer peak periods. About 75% of the generation capacity is from coal-fired power plants, which have caused serious air pollution. Therefore, improving energy efficiency is a high priority for GPG to help address both energy security and environmental issues. Guangdong also provides a good setting to pilot the EPP model because of its vibrant economy and the large impact that energy savings will have in comparison with less industrialized provinces.

Impact Improved overall energy intensity and reduced emissions in Guangdong Province.
Project Outcome
Description of Outcome Improved energy efficiency in selected industrial and commercial sectors in Guangdong province.
Progress Toward Outcome The Project is rated "satisfactory" in terms of implementation progress and also compliances with covenants. There is no delay in terms of loan utilization.
Implementation Progress
Description of Project Outputs

Energy efficiency projects of Tranche 2 implemented

ESCO sector developed in Guangdong

Capacity developed for promotion and assessment of energy efficiency

Status of Implementation Progress (Outputs, Activities, and Issues)

100% of the total amount loan was withdrawn. All six sub-borrowers have fully utilized their sub-loans.

Tranche 2 has developed approximately an EPP equivalent to 40.4 MW, and provided energy savings of about 202,013 MWh/year and emissions reduction of total suspended particulates (TSP) of 676 tons/year (t/y), sulfur oxide of 1,818 t/y, nitrogen oxide of 404 t/y, and carbon dioxide of 157,500 t/y, which have already achieved more than the designed energy efficiency and emission reduction results.

Three workshops have been held, and public education program has been conducted at the Guangzhou Energy Conservation Exhibition yearly.

Geographical Location Guangdong Province
Safeguard Categories
Environment FI
Involuntary Resettlement C
Indigenous Peoples C
Summary of Environmental and Social Aspects
Environmental Aspects The Project is classified as environmental category financial intermediary (FI), as all subprojects will only have insignificant environmental impacts, in accordance with the ADB's Environment Policy (2002) and Environmental Assessment Guidelines (2003). All six subprojects can meet the environmental criteria for subproject selection and will have only insignificant impacts. All subprojects can meet relevant national environmental laws and regulations. Implementation of the Project will improve energy security and environmental quality in Guangdong. Moreover, it will reduce coal consumption, free up resources, and lower the risks associated with coal mining and transportation.
Involuntary Resettlement The Project will not involve any land acquisition or resettlement.
Indigenous Peoples Since all subprojects are retrofit projects, the Project will not have any adverse social impacts, including on ethnic minorities.
Stakeholder Communication, Participation, and Consultation
During Project Design
During Project Implementation
Business Opportunities
Consulting Services In case that consulting services are needed, subborrowers will be required to follow the relevant procurement rules in accordance with ADB's Procurement Guidelines (2007, as amended from time to time). A summary of procurement plan for the Project is in Attachment 4 of Appendix 1 of the approved project report. In case of noncompliance, GFTC will exercise the right to recall the subloan.
Procurement The procurement mode for works and goods is consistent with the procurement threshold agreed in the FFA. Subborrowers will be required to follow the relevant procurement rules in accordance with ADB's Procurement Guidelines (2007, as amended from time to time). A summary of procurement plan for the Project is in Attachment 4 of Appendix 1 of the approved project report. In case of noncompliance, GFTC will exercise the right to recall the subloan.
Responsible ADB Officer Xinjian Liu
Responsible ADB Department East Asia Department
Responsible ADB Division PRC Resident Mission
Executing Agencies
Government of Guangdong Province (GGP)Ms. Cao Yuyingcyy@gdwbo.gov.cnFloor 11, No. 26 Cangbian Rd., Guangzhou, PRC
Timetable
Concept Clearance 31 Aug 2006
Fact Finding 14 Oct 2009 to 19 Oct 2009
MRM 16 Nov 2009
Approval 16 Dec 2009
Last Review Mission -
PDS Creation Date 18 Apr 2008
Last PDS Update 22 Jan 2013

Loan 2611-PRC

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
16 Dec 2009 30 Mar 2010 28 May 2010 31 Dec 2012 - 08 Oct 2012
Financing Plan Loan Utilization
Total (Amount in US$ million) Date ADB Others Net Percentage
Project Cost 66.14 Cumulative Contract Awards
ADB 22.06 16 Dec 2009 22.06 0.00 100%
Counterpart 44.08 Cumulative Disbursements
Cofinancing 0.00 16 Dec 2009 22.06 0.00 100%
Status of Covenants
Category Sector Safeguards Social Financial Economic Others
Rating - Satisfactory Satisfactory - - -

Safeguard Documents

See also: Safeguards

No documents found.


The Public Communications Policy (PCP) establishes the disclosure requirements for documents and information ADB produces or requires to be produced in its operations to facilitate stakeholder participation in ADB's decision-making. For more information, refer to the Safeguard Policy Statement, Operations Manual F1, and Operations Manual L3.

Requests for information may also be directed to the InfoUnit.