50089-002: Qingdao Rural Waste-to-Energy and Clean Energy Supply in Rural and Suburban Area Project | Asian Development Bank

China, People's Republic of: Qingdao Rural Waste-to-Energy and Clean Energy Supply in Rural and Suburban Area Project

Sovereign (Public) Project | 50089-002 Status: Proposed

In rural Shandong Province, straw and coal are traditional fuel for heating and cooking. They are burned in inefficient heating and cooking stoves, which poses serious indoor and outdoor air pollution and emission of carbon dioxide. Over the decades, the Government of the People's Republic of China (PRC) provided large amount of financial support to promote comprehensive utilization of agricultural and livestock waste in rural areas such as setting up household based biogas digesters, small scale biomass heating boilers, and conversion of agricultural waste to pellet fuel which are operated by farmers or small enterprises. Household based bio digesters have shown good results in terms of economy and technology. However, household biogas digester often cannot produce enough gas in the middle of winter due to lack of feed stock, which compels rural people to use coal for heating.

Project Details

Project Officer
Oi, Teruhisa East Asia Department Request for information
Country
  • China, People's Republic of
Modality
  • Loan
Sector
  • Energy
 
Project Name Qingdao Rural Waste-to-Energy and Clean Energy Supply in Rural and Suburban Area Project
Project Number 50089-002
Country China, People's Republic of
Project Status Proposed
Project Type / Modality of Assistance Loan
Source of Funding / Amount
Loan: Qingdao New-Type Rural Community Organic Waste Pollution Treatment and Waste-to-Energy
Ordinary capital resources US$ 100.00 million
Strategic Agendas Environmentally sustainable growth
Inclusive economic growth
Drivers of Change Gender Equity and Mainstreaming
Knowledge solutions
Partnerships
Sector / Subsector

Energy / Renewable energy generation - biomass and waste

Gender Equity and Mainstreaming Some gender elements
Description

In rural Shandong Province, straw and coal are traditional fuel for heating and cooking. They are burned in inefficient heating and cooking stoves, which poses serious indoor and outdoor air pollution and emission of carbon dioxide. Over the decades, the Government of the People's Republic of China (PRC) provided large amount of financial support to promote comprehensive utilization of agricultural and livestock waste in rural areas such as setting up household based biogas digesters, small scale biomass heating boilers, and conversion of agricultural waste to pellet fuel which are operated by farmers or small enterprises. Household based bio digesters have shown good results in terms of economy and technology. However, household biogas digester often cannot produce enough gas in the middle of winter due to lack of feed stock, which compels rural people to use coal for heating. Establishing medium and large scale livestock industry based biogas plants were actively promoted during the Twelfth Five-Year Plan of the PRC (2011 -2015), however there were mixed success in biogas production due to poor design of plants and lack of human capacity in operation of the plants. Moreover, the current practice of biomass briquette production involves low level of mechanization in the process and poor quality of equipment causing low quality of pellet fuel.

To overcome these issues, a new policy is being issued under the Thirteenth Five-Year Plan (2016 -2020) of the PRC to encourage large energy service providers, such as national level power generation companies, and municipal state-owned gas and heating services providers, entering to rural energy market and exploit untapped biomass to energy. Consistent with this, the proposed project will demonstrate a comprehensive utilization of agricultural and livestock waste to energy for heating and cooking in 60 new rural communities in rural Qingdao to be implemented and operated by the Qingdao Energy Group (QEG), the largest local state-owned energy company in Qingdao, thereby improving the quality of energy access, and reducing air, soil, and water pollution in rural areas. The proposed project will not only directly benefit about 660,000 people in the project area (20% of total rural population in project area), but indirectly benefit the residents of the other parts of Qingdao by removing some of the sources of pollution now emanating from the project area.

The project will complement Asian Development Bank (ADB)-financed Beijing-Tianjin-Hebei (BTH) Clean Air Program. Upon project completion, similar technical application and business model can be replicated in other similar rural areas in the greater BTH region by turning agricultural and livestock wastes to cleaner and low-carbon heating and cooking fuel.

During the project preparation, ADB will facilitate establishing a knowledge and technical exchange platform between the QEG and advanced countries in using biogas and biomass such as Germany, Japan, Sweden, and the United States. This will help Qingdao gain further knowledge and experience in the areas of (i) policies, institutional laws and regulations; (ii) biogas and biomass technologies; and (iii) relevant project experiences.

Project Rationale and Linkage to Country/Regional Strategy

Biomass burning from agriculture sector is one of the main causes of air pollution in the greater BTH region. Farmers in the greater BTH region traditionally burn agricultural waste after the harvest, and plough to bury the ashes in the ground to fertilize farmland. A recent satellite survey by the Ministry of Environmental Protection observed 400 straw burning sites in the greater BTH region, mainly in Hebei and Shandong Provinces, which contribute 15% of fine particulate matter emission in the greater BTH region. An effective way to prevent farmers from burning agricultural waste is to turn the waste into briquette which is carbon neutral and clean fuel for heating and cooking.

As food production demand grows in tandem with economic growth, livestock wastes also became one of the worst water pollution hazards in the country. The total organic pollutants in water from intensive livestock production already exceed that from municipal and industrial sources. Livestock wastes also generate harmful gases such as ammonia, carbon dioxide, and methane. Instead, by turning livestock waste into biogas, it can be used for cooking and heating. Also, biogas systems can produce a nutrient-rich fertilizer, called biogas-slurry, which is a safe, organic, liquid fertilizer that can be applied to crops, hence reducing utilization of chemical fertilizer.

Shandong Province, which is a part of the greater BTH region, is one of the largest granary and livestock industry provinces in the PRC. Qingdao is in eastern Shandong Province, where winter temperatures drop to as low as -17 degrees Celsius, and are typically below zero for 5 months a year. Heating is therefore an essential service for public health and well-being and sustaining people's livelihoods in Qingdao. Like the rest of Shandong (or country), rural urban income gaps are quite high. Per capita net income of rural Qingdao is only 40% of urban income. In January 2014, the Government of the PRC issued a new national urbanization plan which stipulates to upgrade infrastructure, and improve public services in the rural areas to narrow down the income and living conditions gap between rural and urban areas. Consistent with this plan, Qingdao is planning to consolidate 5,983 administrative villages into 1,043 new rural communities with a total population of 3,000 to 5,000 in 1.5 kilometer radius. These new rural communities will have modern social service and infrastructure including energy system.

Impact

Rural-urban living standard gap in Qingdao narrowed

Air quality and rural natural environment in Qingdao improved

Outcome Carbon and pollutants emission from heating and cooking in rural areas in Qingdao reduced
Outputs A waste-to-energy system in rural areas in Qingdao demonstrated
Geographical Location Nation-wide
Safeguard Categories
Environment B
Involuntary Resettlement C
Indigenous Peoples C
Summary of Environmental and Social Aspects
Environmental Aspects An initial environmental examination report will be prepared. Climate change risk to the project is medium and will be assessed during the project preparatory technical assistance. No environmentally sensitive area anticipated to be identified in the vicinity of the project area but this will be confirmed during the project preparatory technical assistance.
Involuntary Resettlement No land acquisition impacts are anticipated and this will be confirmed.
Indigenous Peoples The project site is not located close to any ethnic minority towns or villages. Thus, it is not expected to have adverse impacts on ethnic minorities.
Stakeholder Communication, Participation, and Consultation
During Project Design
During Project Implementation
Responsible ADB Officer Oi, Teruhisa
Responsible ADB Department East Asia Department
Responsible ADB Division Energy Division, EARD
Executing Agencies
Qingdao Municipal Government
c/o Qingdao Mun.Devt.& Reform Commission
No. 11 Xiang Gang Zhong Road, Qingdao
People's Republic of China 266071
Timetable
Concept Clearance 29 Sep 2016
Fact Finding 26 Feb 2018 to 28 Feb 2018
MRM 03 Apr 2018
Approval -
Last Review Mission -
Last PDS Update 12 Sep 2017

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.

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