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| Loan Name | Integrated Renewable Biomass Energy Development Sector Project (formerly Rural Energy and Ecosystem Rehabilitation (Phase II)) | |||
| Country | China,People'sRep.of | |||
| Project Number | 40682- 01 | |||
| Fund Source/Amount[Proposed] |
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| Thematic Classification |
Environmental Sustainability
Economic growth |
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| Project Rationale | The PRC is at a crucial stage in its social and economic development. With increasing industrialization and improving living standards, the PRC's overall demand for energy will grow rapidly, posing severe problems in energy supply and environmental protection. Rural energy consumption is increasing at a rate of 2.6% annually. The PRC is still a large agricultural country with an ample amount of biomass resources, such as livestock and agroprocessing wastes, which can generate substantial quantity of renewable energy. Livestock breeding and agricultural processing industry in the PRC have been developing rapidly and gradually changed from scattered small farms into professional medium- and large-sized farms.a The organic wastes produced from livestock production and agricultural processing are also increasing rapidly, resulting in serious environmental pollution and public health problems. Due to the high concentration of organic materials in the livestock and agricultural processing wastes, anaerobic digestion technology is one of the most effective ways to solve such pollution problems, which could also convert the biomass wastes into biogas to relieve energy shortage pressure. The proposed Project (the Project) will adopt a sector loan approachb to support the Government and six provincesc in the development of rural biomass renewable energy system.
The proposed project supports ADB's Country Partnership Strategy 2008-2010 in improving rural environmental quality, increasing access to energy and reducing reliance on imported energy sources through development of biogas renewable energy source. |
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| Impact | The expected impact of the Project will be better rural environmental management and access to biogas energy. | |||
| Outcome | The outcome of the Project will be improved efficienty of rural biomass renewable energy system and rural social benefits. | |||
| Outputs |
Output 1: Sustainable development and demonstration of commercial practices of MLBGPs.
Output 2: Effective utilization of biogas sludge in eco-farming. Output 3: capacity building for improved sector performance. Output 4: Project implementation support. |
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| Geographical Location | The project provinces include Heilongjiang, Henan, Jiangsu, Jiangxi, and Shandong | |||
Safeguard Categories
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| Environment | B | |||
| Resettlement | C | |||
| Indigenous People | C | |||
| Summary of Environmental and Social Issues | ||||
| Social Aspects |
The Project will benefit farmers in three ways: (i) about 6,000 temporary jobs would be created during construction period, increasing peoples income by CNY4,000 on average over a period of 34 months; and about 1,710 new jobs would be generated. It is expected that the employees' per capita income would increase to above CNY10,000; (ii) about 10,850 poor households would be able to use the organic fertilizers from the biogas plants and benefit from savings on chemical fertilizers and incremental revenue from sale of green produces due to eco-farming; and (iii) expansion of agro-enterprises production capacity after the completion of the biogas plants will benefit over 10,000 farmers from sales of livestock to these enterprises. Each contract farmers annual household income will be about CNY44,200, which is considerably higher than the average income of CNY19,067 in the project area. The Project will also be able to provide clean energy to about 50,000 households and improve their energy consumption by replacing straw, wood, or coal, which protects the environment and reduces womens workload. Some enterprises plan to supply low-priced electricity to neighboring villagers, which improves farmers access to energy. It is estimated that about 77,000 households will benefit from improved environment and health.
All subprojects will take place within the existing land owned by the agro-enterprises. Hence, no land acquisition is required. There are 55 ethnic minorities in the project area, but they only account for 2.9% of the total population. Among the subprojects, none is located in minority autonomous area where majority of the ethnic population is concentrated. There are no ethnic minorities identified in the subproject sites. Therefore, no risks are envisaged to indigenous people. |
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| Environmental Aspects |
The Project is classified as a Category B project. ADB's environmental policy will be applied to review the environmental impacts of subprojects. An SIEE has been prepared, complemented by the Environmental Assessment and Review Procedures, and will be posted on the ADB website after clearance by RSDD. For each subproject, an IEE (or Category II environmental assessment in the PRC's regulation) is being prepared following ADB's environmental assessment and the PRC's regulatory requirements. Timely approval of the IEEs by respective provincial EPB will be acquired.
The Project is expected to achieve environmental benefits, including non-point source pollution abatement, water and air pollution reductions, public health improvement, eco-farming expansion, and reduction in GHG emissions. The Project is estimated to produce 108.4 million m3 of biogas per year resulting in an estimated annual GHG reduction of 1.21 million tons of carbon dioxide (CO2) equivalent. Only minor construction impacts are expected, but these can be mitigated to acceptable levels by applying adequate construction practices. Other issues that will be evaluated as part of the environmental assessment include safety issues regarding the production of biogas and the disposal of possible waste products. |
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| Stakeholder Participation and Consultation | ||||
| During Project Design | Stakeholder participation and consultation were carried out during the IEE preparation of subprojects, project impacts and benefit assessment by implementation consultants, and the Government's and ADB's review missions during the PPTA stage. | |||
| During Project Implementation | Public consultation and participation, which have been key elements of the project design, will continue during the project implementation to (i) meet the evolving needs and expectations of the beneficiaries, (ii) increase public awareness about the benefits of the Project, and (iii) encourage active involvement of local communities to maximize their support for the Project. Stakeholder consultation will continue during the Government's and ADB's review missions during project implementation. Participating enterprises, local farmers, and local government agencies will be invited to the consultations; and views will be recorded and reflected in the Project Administration Memorandum, as appropriate. | |||
| Procurement | ||||
| Consulting Services | Consultants to be financed by MTF and GEF grants will be recruited through two firms by the PMO and the PIOs in line with ADB's Guidelines on the Use of Consultants. The MTF-financed consultants will conduct a survey on the performance of MLBGPs in the six provinces, and develop and implement a performance monitoring mechanism for MLBGPs. The GEF-financed consultants will assist in capacity building and project management for the design, construction, and operation of the centralized biogas plants. The Project will require consulting services to assist in project implementation management, which will be financed and engaged by GTZ. | |||
| Civil Works/Goods | All procurement of goods and works will be carried out in accordance with ADB's Procurement Guidelines (2007, as amended from time to time). Each subborrower will engage the services of a qualified tendering agency to carry out the procurement under the supervision and guidance of the respective PIO. Contracts for goods estimated to exceed $1 million and contracts for works estimated to exceed $10 million will be procured using international competitive bidding procedures. Contracts for goods and works estimated to cost less than the international competitive bidding values but more than $100,000 will be procured through national competitive bidding procedures in accordance with the PRC Tendering and Bidding Law, 1999, subject to modifications agreed with ADB. Contracts for goods and works for individual subprojects where the goods estimated to cost $1 million or less and the combined cost of goods and works is equal to or below $10 million will be procured as turnkey contracts using the national competitive bidding procedures. Contracts for goods and works estimated to cost $100,000 or less will be procured using shopping procedures. The relevant sections of ADB's Anticorruption Policy (1998, as amended to date) will be included in all procurement documents and contracts. | |||
| Responsible ADB Officer |
Yue-Lang Feng |
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| Responsible ADB Department |
East Asia Department |
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| Responsible ADB Division |
Agriculture, Environment, and Natural Resources Div, EARD |
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| Executing Agencies |
Ministry of Agriculture Mr. Zhou Qijiang, Deputy Dir. Gen., FECC |
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| Timetable | ||||
| Concept Clearance | 06 Mar 2009 | |||
| Fact-finding | 02 Mar 2009 to 06 Mar 2009 | |||
| Board Approval | II Jan 2010 | |||
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