104284 REV Environmental and Social Systems Assessment (ESSA) INDONESIA POWER DISTRIBUTION DEVELOPMENT PROGRAM FOR RESULTS January 15, 2016 The Environmental and Social Assessment (ESSA) of the Indonesia Power Distribution Development Program for Results was prepared by a Bank team comprised of Kian Siong (Environmental Specialist, GP ENR) and Sulistiowati (Social Development Specialist, Consultant). i Acronyms and abbreviations ABBREVIATIONS ADB – Asian Development Bank AMDAL – Analisis Mengenai Dampak Lingkungan (EIA) BLH/BPLHD – Badan Lingkungan Hidup/Badan Pengelola Lingkungan Hidup Daerah (provincial/district Environment Agency) EGSS – Electricity Grid Strengthening – Sumatra EIA – Environmental Impact Assessment ESSA – Environmental and Social System Assessment EMP – Environmental Management Plan GOI – Government of Indonesia HQ – Headquarter IBRD – International Bank for Reconstruction and Development IUCN – International Union for Conservation of Nature K3-L – Keselamatan, Kesehatan Kerja, Keamanan dan Lingkungan (Safety Occupational Health, Safety and Environment) KBA – Key Biodiversity Area kV – kiloVolt LH – Lingkungan Hidup (Environment) MOEF – Ministry of Environment and Forestry OP – Operational Policy PERMEN – Peraturan Menteri (Ministry Regulations) P3BS – Pusat Penyalur dan Pengatur Beban Sumatra (loan dispatch center of Sumatra) PAP – Program Action Plan PDDP – Power Distribution Development Program PforR – Program for Result PCB – Polychlorinated Biphenyls PIU – Program Implementation Unit PLN – Perusahaan Listrik Negara (State Electricity Corporation) PLN Decree – Decree of the Board of Directors of PLN PMU – Program Management Unit ROW – Right-of-Way RUPTL Rencana Usaha Penyediaan Tenaga Listrik (Indonesia’s power expansion plan) SAIDI – System Average Interruption Duration Index SAIFI – System Average Interruption Frequency Index SCM – Supply Chain Management SILM – Sistem Informasi Laporan Management (Information System for Management Report) SMK3 – Sistem Manajemen Kesehatan dan Keselamatan Kerja (occupational health and safety management system) SPPL – Surat Pernyataan Kesanggupan Pengelolaan dan Pemantauan Lingkungan ii Hidup (letter of commitment for the EMP and EMoP) TA – Technical Assistance UKL/UPL – Upaya Pengelolaan Lingkungan Hidup/Upaya Pemantauan Lingkungan Hidup (environment management efforts and environment monitoring efforts) Wilayah – PLN Regional Office iii TABLE OF CONTENTS Executive Summary ………………………………………………………………………….... v Introduction …………………………………………………………………………………….1 1 Program Description....................................................................................................................... 1 1.1 Program Scope ................................................................................................................................ 1 1.2 Typology of Works .......................................................................................................................... 6 1.3 Main Stakeholders related to the Program .................................................................................. 8 2 Program context and potential impacts ........................................................................................ 9 2.1 Environmental Context .................................................................................................................. 9 2.2 Potential Environmental Impacts ................................................................................................ 10 2.3 Potential Social Impacts ............................................................................................................... 11 2.4 Mitigation and Prevention Measures to Reduce Environmental Impacts ............................... 13 3 Environmental Management System .......................................................................................... 14 3.1 Institutional Responsibilities ........................................................................................................ 14 3.2 National Regulatory Framework ................................................................................................. 14 3.3 Safeguard Application to PDDP Subproject .............................................................................. 19 3.4 Program Capacity in the Environmental Management - Performance Assessment .............. 22 3.5 Relevance with the Principles of OP 9.00 ................................................................................... 23 4 Social Management System .......................................................................................................... 25 4.1 Institutional responsibilities ......................................................................................................... 25 4.2 Description of the regulatory framework ................................................................................... 25 4.3 Program Capacity in the Social Area and Performance Assessment ....................................... 26 4.4 Relevance to the Principles of OP 9.0 .......................................................................................... 26 5 Assessment of Program System ................................................................................................... 28 6 Inputs to the Program’s Action Plan........................................................................................... 40 6.2 ESSA Consultation and Disclosure ............................................................................................. 41 7 Environmental and Social Risks .................................................................................................. 42 7.1 Potential environmental and social risks .................................................................................... 42 7.2 Past project performance track-record on safeguards .............................................................. 42 7.3 ADB involvement in the Program ............................................................................................... 43 7.5 Evaluation of the Environmental and Social Risks ..................................................................... 43 8 Inputs to the Program Implementation Support Plan............................................................... 44 iv Figures and Tables Figure 1 Local Flow of Sumatra interconnection Systems at Peak Time (June 2015) 10 Figure 2 Institutional and Implementation Arrangement 14 Figure 3 PLN Call Center 123 Accessibility 20 Table 1 Program Results Chain 2 Table 2 Typology of Activities Which Will Support the Program 7 Table 3 Main Regulations Applicable to the Operation of the PLN Program 16 Table 4 Main Processes of the Program Implementation and Environmental 22 Management Table 5 Evaluation of the Program Environmental and Social Systems amd Its Relation 29 to the OP 9.00 from the World Bank Table 6 Environmental and Social Measures for the Program Action Plan 40 Table 7 Global Risk Assessment of the Program 43 Table 8 Environmental and Social Support Plan for the Implementation of the Program 44 Annex 1 Sumatra Island Power Transmission Lines (Existing and Future Development) A. Existing interconnection system of Sumatra Island Power 45 B. Future interconnection system of Sumatra Island Power 46 Annex 2 Forest Area (National Park, Protected Forest and Production Forest) 47 Annex 3 Minutes of Public Consultation on Draft ESSA and the list of participants 48 v EXECUTIVE SUMMARY The Indonesia Power Distribution Development Program for Results (PDDP or “the Program”) aims i) to increase access to electricity supply, ii) to improve quality of service and distribution efficiency (through reduction of distribution losses) and reliability (through reduced outages and improved voltage conditions) of its delivery in selected geographic areas of Indonesia, iii) To improve power consumption and iv) to improve PLN’s institutional capacity for program planning, design, implementation, and monitoring and evaluation. The State Electricity Corporation (PLN) has selected the Sumatra region for coverage under the proposed program based on several specific criteria. Sumatra, with an electrification ratio of about 85% ranks in the middle between Java Bali and eastern Indonesia and it is the largest population center outside Java Bali. Of the total of about 54 million people, nine million have no access to electricity. To improve the likelihood of meeting its program targets, PLN’s strategy is to mobilize multilateral funding to complement its own and fill the financing gap for the Sumatra distribution program. Positive environmental and social benefit is expected as major results, specifically, up to almost 3 million customers could be added to the grid in the five year period through 2019 resulting in an increase in the electrification ratio to about 90%. The Program will only finance the power distribution activities in rural and urban areas in Sumatra and most of the additional customers would be in areas already electrified and would thus tend to represent the lowest income households in these areas. The Program to be supported by the Bank is a geographic slice of the distribution component of the RUPTL (Indonesia’s power expansion plan) covering Indonesia’s Sumatra region for the period 2015-2019. The estimated cost of the Sumatra distribution program is US$1.45 billion or about 20% of the total national distribution program over the first five years of the 2015-2024 RUPTL. PLN has selected the Sumatra region for coverage under the proposed program based on several specific criteria. First, Sumatra has the largest population center outside Java Bali with about 54 million people, of which nine million have no access to electricity and is an important economic growth center for Indonesia. Second, there are substantial existing and planned generation and transmission investments in Sumatra that require complementary investment in distribution in order to enable the power produced when these investments are commissioned to be delivered to the regional economy. Third, a focus on Sumatra offers the best prospect for fast progress towards achieving the RUPTL’s national electrification ration (ER) target of 99.4 percent by 2024. Up to about 3.2 million customers could be added to the grid in the 5 year period to 2019 resulting in an increase in the regional electrification ratio from 85 percent to about 90 percent. Fourth, the region offers the best opportunity for “piloting” the use of the International Financing Institutions (IFI’s) performance-based lending instruments, learning lessons, and improving effectiveness of its program expenditure management before attempting to use them in the more difficult terrain of eastern Indonesia. Thus, PLN’s strategy is to mobilize multilateral funding to complement its own and fill the financing gap for the Sumatra distribution program. vi Typology of work The PDDP is to increase access to electricity supply by extension of 20 kV distribution lines, meanwhile in order to improve the efficiency through reduction of distribution losses, distribution substation will be added to the distribution lines and finally for increasing the reliability through reduced outages and improved voltage conditions, switching substations will be constructed.  Extension of 20 kV distribution lines. Installation of new poles and power grid which for most cases will be placed along the right of way (ROW) of existing roads owned by the district/provincial government. Besides the new poles, the distribution expansion can take place in form of double feeder system (i.e. network expansion using the same pole).  Installation of distribution substations (Gardu Distribusi). There are two typical distribution substations to be installed: o Gardu Cantol, i.e. distribution transformer that is mounted to a single pole o Gardu Portal, i.e. distribution transformer that is installed on a pad (platform) created by two poles  Construction of switching substations (Gardu Hubung). The landed power distribution facilities to improve the reliability of power supply. Switching substations will require an area of approximately 48 m2. Institutional and Implementation Arrangement PLN Regional Office in charge for distribution is known as PLN Wilayah (or Wilayah) There are six Wilayahs plus one distribution unit in Sumatra which cover; (i) Aceh; (ii) North Sumatra; (iii) West Sumatra; (iv) South Sumatra, Jambi, and Bengkulu; (v) Riau and Riau Islands; (vi) Bangka Belitung; and (vii) Lampung (Distribution unit). Wilayahs are responsible for the construction, operation, and maintenance of distribution lines (20 kV). The Program will be administered by a central Program Management Unit (PMU) at PLN HQ, but the physical implementation activities will be carried out by Wilayahs that serve as Program Implementation Units (PIUs). The Wilayahs have been carrying out similar programs over the years and are experienced and capable of managing the distribution construction work envisaged under the program. Most material requirements will be requisitioned from approved suppliers under PLN Supply Chain Management (SCM) system and the balance of items will be procured locally by the Wilayahs. The construction works contracts will be procured by the Wilayahs. All implementation activities will be carried out by the respective contracts divisions within each Wilayah and overseen by the distribution systems manager under the Wilayah General Manager. The PMU supported by PIUs will bear overall responsibility for the work program, quality and timeliness of the program works, and its satisfactory completion. Environmental and Social Management. Environmental Management. PLN both HQ and Wilayahs have dedicated safeguard staffs. The HQ staff is responsible for policy matters and overall supervision while the staff in Wilayahs is responsible for the project implementation, supervision and reporting. At the HQ, the Division of Health, Safety, Security and Environment (K3-L) under the Director of Human Capital Management, comprising four fulltime staffs manages the environmental and social safeguards vii issues all over the country. Meanwhile, each Wilayah has an environmental unit (some wilayahs merge environmental unit with unit of Electricity Safety and Occupational Health and Safety). The Environmental unit in Wilayah is the main unit responsible for the environmental and social management, including the preparation of the environmental documentation and the analysis and follow-up of environmental supervision. Depending on the number/scale of projects, this safeguard unit in Wilayah is comprised of two or three staffs to oversees the compliance of safeguards related laws/regulations and PLN guidance. Each individual Wilayah will be responsible for the construction work as well as management of environmental and social impact due to the Program. PLN has been implementing many power sector projects funded by multilateral agencies for over 20 years; the projects include the existing World Bank funded Upper Cisokan Pumped Storage Hydro-Electrical Power, Indonesia Power Transmission Development Project (IPTD1&2) and many others. The PLN has acquired sufficient knowledge and experience in managing environmental and social safeguards issues. And in regular basis, to enhance its staff capacity, both staffs from HQ and Wilayahs are given opportunities to attend trainings (including training on environmental and resettlement safeguards) provided by the Education and Training Unit of PLN Corporate (Pusdiklat) twice per year. Social Management. PLN particularly the seven Wilayahs in Sumatera are responsible for handling complaints for all cases including environmental and social issues. Wilayah is also responsible for obtaining land for installing poles in the right-of-way and direct purchase of land for switching substation by the Program activities. In most cases, distribution network does not require land acquisition and very few social impacts are expected. However, in some locations, poles installation located in private land may need re-alignment should the poles would block the access owner to the property (e.g. the house entrance). The Program may need small piece of land for switching substation (6x8m2), in which Wilayah will carry out the land acquisition on the basis of willing buyer willing seller (direct purchase). Funds to purchase the land are provided by each Wilayah and will not use the loan funds. Other donors The Asian Development Bank (ADB) has prepared and negotiated a Results Based Loan (RBL) of US$600 million to PLN. The ADB RBL instrument is very similar to the PforR. The RBL will support PLN’s transmission and distribution expenditure program over the 2015-2019 period in Sumatra region. Thus, both ADB and the Bank are proposing to provide parallel financing for the same distribution program in Sumatra over the same period. The only difference in program coverage is that of the US$600 million ADB Loan about US$180 million will be used to support prior results of the transmission component of the RUPTL; otherwise the Disbursement-Linked Indicators (DLIs), the implementation, monitoring and evaluation arrangements have been successfully harmonized through consultations and information sharing during the preparation process. ADB has also signaled to the Bank their intention to adopt the principle of third party verification of results that will be used for the PforR. viii Environmental and Social Impacts Environment impacts. Program will only finance the power distribution activities at rural and urban areas in Sumatra region. The Program will screen out any high risk activity as defined in the Ministry of Environment Regulation (PERMEN) No 05/2012 on Type of Activities Requiring AMDAL (i.e. full environmental assessment or Category A as per WB Safeguard Policies). The Program will also exclude any activity within or adjacent the protected areas, national park, natural habitat. The extension of power distribution lines itself is not covered under the PERMEN No 05/2012 due to its low potential impacts. Wilayahs have been carrying out similar programs over the years and have applying environmental safeguard measures stipulated in Decree of the Board of Directors of PLN (PLN Decree) No. 473/2010 on Construction Standard for Low Voltage Power Network and PLN Decree No.606/2010 on Construction Standard for Medium Voltage Power Network, PLN Decree No.605/2010 on Construction Standard for Power Distribution Substation and Switching Substation. Based on site visits to the recently and ongoing distribution work, the team concludes that the Wilayahs have adequate capacity in managing the distribution construction work envisaged under the Program, although some improvement notably a better construction site management. Social impacts. The Program will not have negative impact to communities of indigenous peoples. The Program will be implemented in both rural and urban areas that are already electrified (with existing access roads available for operation and maintenance). Results of public consultation in five Wilayahs showed all parties support and even requested the PLN to expedite implementation of the Program. In order to allow fast implementation, impact on social and environmental shall be minimum, thus for this reason, the Program will avoid work in forest or conservation area or protected forest that needs environmental permits from Ministry of Environment and Forest. Representatives of indigenous groups participated in the public consultation and voiced that the program should benefit and bring positive impacts to the groups. They encourage PLN to provide electricity access to all citizens and request the PLN not to ignore their existence. The groups also mentioned that they have been waiting for electricity connection for long time and will participate in consultation process prior to the construction to reach consensus on how the Program will be implemented. The activities to be financed under the Program will at most not require acquisition of land. Poles installation normally take place within ROW owned by the district or city or provincial government that will not require land acquisition or cause physical or economic displacement. On special cases, if land acquisition is required for switching substation, the social impact is expected to be minor as the acquisition will normally affect narrow strips of land without dwellings or other structures. Social impact due to the land acquisition for switching substation is minor considering the size (6x8m2) and the number of substations to be constructed is very limited. PLN experiences in implementation of distribution lines extension shows there is no physical displacement of person due to land acquisition except minimum number of trees that are not located at forest area/protected area. Environmental and Social Performance of the Program Environment. Environmental documentation reviewed, information collected during interviews and consultations with main stakeholders as well site visits to several subproject sites indicate ix that the environmental and social management that PLN applies to distribution lines extension are encouraging in preventing and reducing environmental and social impacts and overall in compliance with the core principles and key elements of the OP 9.00. The country legislation, among others aspects i) requires an environmental impact assessment for any type activity potentially generating adverse impact; ii) protects native forests and endangered species, iii) establishes controls to avoid pollution, and iv) promotes health and safety at work sites. Regarding management capacity, the PLN has qualified and motivated staffs to carry out environmental and social management and monitoring of the works of the Program. Related to the distribution activities, the requirement for environmental impact assessment is not covered by GOI’s legal framework, however environmental mitigation measures are stipulated in Decree of the Board of Directors of PLN (PLN Decree) No. 473/2010 on Construction Standard for Low Voltage Power Network1 and PLN Decree No.606/2010 on Construction Standard for Medium Voltage Power Network2, PLN Decree No.605/2010 on Construction Standard for Power Distribution Substation and Switching Substation3. PLN implements good practices on managing environmental and social impacts, e.g. conducting meaningful public consultation in planning stage, provision of waste storage and segregation, and the use of environmentally accepted equipment such as non-polychlorinated biphenyls (PCB) transformers. Worker health and safety is the first and foremost in PLN project implementation. To address the potential risks on workers’ health and safety, SMK3 (Sistem Manajemen Kesehatan dan Keselamatan Kerja or occupational health and safety management system) was established by PLN respectively for transmission, main substation and distribution. The system, however needs to be strictly and consistently enforced all the time among workers and contractors. Performance of occupational health and safety and safeguard compliance are reported quarterly through the online system (i.e. SILM, Sistem Informasi Laporan Managemen-- or Information System for Management Report), accessible by authorized staffs but regular monitoring by Wilayahs needs to be done to make sure that workers and contractors are implementing health and safety measures at the work place. The SILM has scoring system to track the performance and progress of operational aspects in Wilayahs, including environmental and social management performance. Social. PLN carries out preliminary survey with meaningful consultation in the planning stage as part of the annual work plan preparation. Socialization of the plan includes consultation that may affect to non-land assets (mainly trees) and agreement from land owners for use of land in case poles need to be located on private land. PLN has a proven capacity to implement distribution project financed by PLN. In the case of distribution project, Wilayahs mitigates social issues effectively and manages the risk sufficient (there was land acquisition only without physically displaced person or economic displacement) and the outcomes were satisfactory from the perspective of affected persons. In term of land acquisition, no significant gaps were identified between the practices and OP 9.00 core principles. 1 PLN.2010. Lampiran Keputusan Direksi PT PLN (Persero)/Nomor:473.K/DIR/2010 Buku 3 – Standar Konstruksi JaringanTegangan Rendah Tenaga Listrik 2 PLN.2010. Lampiran Keputusan Direksi PT PLN (Persero)/Nomor:606.K/DIR/2010 Buku 5 – Standar Konstruksi JaringanTegangan Menengah Tenaga Listrik 3 PLN.2010. Lampiran Keputusan Direksi PT PLN (Persero)/Nomor:605.K/DIR/2010 Buku 4 – Standar Konstruksi Gardu Distribution and Gardu Hubung Listrik x Environmental and Social Risks Environment. In general, the positive impacts that the program are expected to generate include benefits to the overall economy, improvements to the access to electricity for about 3 million additional customers. While potential adverse environmental and social impacts from the construction activities are low and manageable through the technical guideline of PLN Decrees on construction of distribution lines. There is risk however if enforcement of provisions in the contract is weak that results in community complaint. Potential environmental risks include: (i) risk of not applying initial screening prior to submission of Wilayah annual work plan for the Program to PLN HQ; (ii) risk of inadequate environmental supervision (e.g. Used transformer oil or oil spillage management, health and safety of communities, workers and contractors); and (iii) risk of contractors poor construction site management. Although the Wilayahs have been carrying out similar programs over the years and are experienced and capable of managing environmental and social issue related to the construction work for distribution lines, capacity in environmental and social management particularly in Wilayahs should be maintained through regular evaluation by PLN HQ (via SILM) and capacity building program (e.g. training). The Program Action Plan includes actions to mitigate these risks and ensure good environmental management practice to be adopted to this program. Social. The social risks associated to the Program are low, i.e. i) risk of not applying initial screening (i.e. to avoid physical or economic displacement) prior to submission of Wilayah annual work plan for the Program to HQ and ii) the risk due to unfair in plants/crops compensation. Capacity in environmental and social management particularly in Wilayahs should be maintained through regular evaluation by PLN HQ (via SILM) and capacity building program (e.g. training). ESSA consultation A preliminary consultation on the proposed framework of ESSA took place in PLN HQ, Jakarta on September 7th and 9th, 2015; PLN HQ and Wilayahs staffs involved in design, construction, supervision, maintenance in distribution, as well as PLN Headquarter Environmental Unit consulted on the preliminary findings of the assessment, the strengths, risk and proposed action plan. Inputs from the consultation were included in the action plan. Draft ESSA has been disclosed on October 16, 2015 at the Infoshop (English version) and PLN web sites (Indonesian version). The first public consultation of draft ESSA took place in Bandar Lampung on Oct 19th, 2015, subsequently on Nov 3th and 5th, 2015 it was held in City of Banda Aceh and Tanjung Pandan (Belitung Island) respectively. Two more consultations were in Palembang (South Sumatra) on Dec 10 then Padang (West Sumatra) on Dec 11. Representatives of various local governments (provincial, district/city level) agencies, local universities, communities/ethnic groups and civil society participated the public consultation. In each consultation, Bank staff presented detailed information on the PforR process, the proposed Power Distribution Development Program, the key findings and recommendations of the ESSA. Inputs received during consultations were positive toward the Program implementation though some criticized poor service quality of the PLN (notably was the outage). Inputs/feedback from these consultation are included in final version of the ESSA. xi The final ESSA in both English and Indonesia was disclosed on January 8, 2016 before negotiations. xii INDONESIA POWER DISTRIBUTION DEVELOPMENT PROGRAM Environmental and Social Systems Assessment (ESSA) Introduction 1. This document evaluates the systems currently applied by the State Electricity Corporation (PLN) for power distribution development to manage environmental and social impacts and risks. The main purpose of the evaluation is to determine the extent to which these systems are consistent with relevant core principles and attributes specified in the World Bank Policy, OP 9.00 for programs supported through the Program for Results (PforR) instrument, approved by the Bank in January 2012. 2. The assessment was prepared by the World Bank environmental and social specialists in consultation with staffs from the PLN and other relevant stakeholders who were consulted. This assessment is based on: (i) interviews with PLN staffs from the HQ and Wilayah and its contractors for operation and maintenance of distribution lines, (ii) site visits to PLN power distribution network projects and interview affected persons, (iii) review of Indonesia environmental and land acquisition regulations, (iv) desk review of relevant documentation including instruments for supervision, monitoring and evaluation. 3. The assessment has eight sections. Section 1 describes the scope of the Program and its institutional context. Sections 2 describes the Program context and potential impacts; sections 3 and 4 describe the Program environmental and social management systems respectively, as defined in laws, regulations, internal procedures, etc. Section 5 assesses the environmental and social management capacity of the implementing agencies and determines the extent to which the environmental and social management systems are consistent with the core principles and attributes specified in the OP 9.00 for programs supported through the PforR instrument. Section 6 specifies key measures to improve the performance of the environmental and social management systems (Inputs to the Program Action Plan). Section 7 provides an environmental and social risk rating and proposes risk mitigation measures. Finally, Section 8 describes the support that the Bank will provide in environmental and social areas (Inputs to the Implementation Support Plan). 1 PROGRAM DESCRIPTION 1.1 Program Scope 4. PLN’s current power expansion plan comprising generation, transmission and distribution investment requirements (the “Rencana Usaha Penyediaan Tenaga Listrik” or RUPTL) covers the period 2015-2024. The broader context for the RUPTL is the Rencana Umum Ketenagalistrikan Nasional (RUKN) which is a 20-year national policy document approved by Parliament. The RUKN provides the GoI’s policy guidance for preparation of the RUPTL. This guidance is related primarily to the projected energy demand and desired targets 1 for electrification and the energy mix of production. The current RUKN was approved by Parliament in 2008 and covers the period up to 2027. 5. To close the power infrastructure gap which is constraining economic growth the current administration is focusing on implementation of the 5-year time slice of the RUPTL covering the period 2015-2019. Consistent with both the RUKN and the RUPTL the key objectives of the 5- year time slice are to increase access to electricity for household consumers and to meet the economy’s power needs while improving efficiency and reliability of supply. Its specific key targets are to increase generation capacity by 35 GW and increase access to electricity from 85%, to 97% by 2019. Further, PLN’s detailed implementation plan envisages improvements in efficiency (losses reduction) and reliability indicators (SAIDI and SAIFI). 6. The estimated total costs of the RUPTL for 2015-2019 are US$83.4 billion of which US$58.9 billion is for generation, US$17.1 billion for transmission and US$7.4 billion for distribution. The Government’s program on which the proposed PforR is based is the distribution component of the 2015-2019 time slice of the RUPTL which entails activities to improve distribution system planning capabilities, connect new customers, improve existing distribution networks, and increase the quality of services. 7. The PforR Program to be supported by the Bank is a geographic slice of the distribution component of the RUPTL covering Indonesia’s Sumatra region for the period 2015-2019. The estimated cost of the Sumatra distribution program is US$1.45 billion or about 20% of the total national distribution program over the first five years of the 2015-20124 RUPTL. PLN has selected the Sumatra region for coverage under the proposed program based on several specific criteria. First, Sumatra has the largest population center outside Java Bali with about 54 million people, of which 9 million have no access to electricity and is an important economic growth center for Indonesia. Second, there are substantial existing and planned generation and transmission investments in Sumatra that require complementary investment in distribution in order to enable the power produced when these investments are commissioned to be delivered to the regional economy. Third, a focus on Sumatra offers the best prospect for fast progress towards achieving the RUPTL’s national ER target of 99.4 percent by 2024. Up to about 3.2 million customers could be added to the grid in the 5 year period to 2019 resulting in an increase in the regional electrification ratio from 85 percent to about 90 percent. Fourth, the region offers the best opportunity for “piloting” the use of the IFI’s performance-based lending instruments, learning lessons, and improving effectiveness of its program expenditure management before attempting to use them in the more difficult terrain of Eastern Indonesia. Thus, PLN’s strategy is to mobilize multilateral funding to complement its own and fill the financing gap for the Sumatra distribution program. 8. The Program will support implementation of activities designed to achieve PLN’s program goals in five result areas as follows. 2 Table 1: Program Results Chain Result Area Activities Intermediate Outcomes indicators/outputs RA 1: Improve access Extension of 20kV Additional Length of Number of residential to electricity distribution lines distribution lines (increase in customers connected kms) Additional Capacity of distribution transformers (increase in MVA) RA 2: Improved System reinforcement Additional Length of MV Reduction in SAIFI and quality of service Customer outage distribution lines (increase in SAIDI management kms) Number of MV feeder interruptions per 100 kms Additional Capacity of distribution transformers (increase in MVA) RA 3: Improved Rehabilitate and upgrade Approved annual work plans Reduction in distribution distribution efficiency distribution lines (RKAP) losses Rehabilitate and upgrade Percentage of work plans substations Improved completed metering Additional distribution transformer units RA 4: Increased power All above activities will Percentage of work plans Volume of additional consumption contribute to this result completed energy sales (increase in area TWh) RA 5: Institutional  Improve distribution Approved annual work plans Increased efficiency in strengthening and planning (RKAP) program implementation capacity building  Staff training Issue revised distribution Increased transparency  Post PLN planning guidelines in procurement Procurement Enhanced use of GIS regulations on website facilities  Improve procurement Integrate budgeting with and contract ERP in one priority region management Number of certified and skilled systems planners and procurement staff Contract data publicly Increased efficiency in  Conduct market available program implementation research of local mfg. Reduced time for contract capacity for MDU award/amendment & signing items  Conduct a diagnostic Mfg. capacity shortfalls if any, Improved procurement analysis of PLN’s identified and actions taken to & contract management project management broaden the mfg. base. performance for EPC system Reduced time for bid contracts evaluation Improved transparency PLN blacklist made publicly  Disclosure of PLN’s available blacklist onto website & electronic portal . 3 9. The selection of DLIs was guided by three key considerations. For each result area, the use of the identified outcome indicators as DLIs was considered first as this would directly provide the incentives for meeting program goals. The second step was to consider the feasibility of measuring, monitoring and verifying the indicators. In cases where the measurement and monitoring of outcome indicators presented difficulties due, for example, to deficiencies in PLN’s systems the use of output/intermediate indicators was considered. In the latter situation, the choice of specific intermediate/output indicators was guided by their significance in signaling progress towards achieving the planned outcomes. Finally, the selection of DLIs was informed and coordinated with the Asian Development Bank who is financing the same program in Sumatra. The selection of DLIs has therefore been completely harmonized with the ADB. 10. Apart from the institutional strengthening and capacity building results area all the indicators are already being measured and monitored by PLN. The rationale for the choice of DLIs by result area is further elaborated below: a. Improved Access to electricity: The number of residential customer connections is a key indicator used by both PLN and the GOI to assess progress of the country’s electrification goals. This is a direct outcome measure for access that is easy to measure, monitor and verify. In addition to this indicator the task team and PLN agreed to also use the length of additional MV distribution lines as an additional DLI for increased access given that it is an important signal of progress towards increasing customer connections. It will also measure network coverage which is an indicator of possible additional connections that will materialize in future. b. Improved quality of service: Ideally SAIDI and SAIFI would be the best outcome measures for assessing the quality of services. However, PLN’s procedures for measuring SAIDI and SAIFI while improving are still work in progress and will be strengthened with the conversion of distribution control centers into full SCADA functionality and with the completion of installation of GIS facilities in all Wilayahs during the Program period. Hence the Bank and PLN agreed to use the number of MV feeder technical interruptions per 100 km (an intermediate indicator) as the DLI for this result area. Nonetheless SAIDI and SAIFI indicators will be monitored and reported under the Program’s Results Framework. c. Increased efficiency: Distribution system losses are a key measure of a utility’s operational efficiency. Recent trends, however, have seen distribution losses increasing in both 2013 and during the first half of 2015. The improvement of distribution losses is heavily dependent on the completion of the new grid substations and associated transmission lines (a complementary project but outside the scope of this project). Without the timely completion of these grid substations technical losses are expected to increase with the added network loads. Furthermore while some investments in the Program will help to reduce losses others such as network expansion may actually increase losses. The Bank and PLN have agreed to focus efforts on improving network planning to minimize losses. They have also agreed to use additional number of transformer units installed, an intermediate indicator, as the DLI for this result area. The additional number of transformers connected will help to PLN to focus on reducing LV feeder lengths and increasing MV coverage which will help reduce the technical losses in the LV system. 4 d. Increased power consumption: This is a straightforward measures that captures the translation of increased residential customer connections (the DLI under RA 1) into actual access benefits for the beneficiaries. It also captures the increase in consumption of existing consumers, which sometimes need to be facilitated by network improvements. This also is a measure that PLN ordinarily monitors and is easily verifiable through billing reports. The use of this measure as a DLI will give PLN incentive to increase actual power flows and not only customer connections. e. Institutional strengthening and capacity building: The three DLIs for this results area are based on the prioritized recommendations of the draft technical and fiduciary assessments. For prior results the approval of 2016 work plans is intended to provide PLN with an incentive to expedite the approvals before the start of its fiscal year so that its Wilayahs have enough time to fully implement the plans within the year. The two DLIs for the implementation phase are intended to strengthen distribution system planning and improve program budgeting. The measures supported by the institutional strengthening and capacity building results area will be expected to positively impact implementation of the entire PLN distribution program beyond Sumatra and beyond the RPJMN in the long term. 11. Implementing Agencies. PLN’s regional offices are called PLN Wilayah. There are six Wilayahs plus one distribution unit in Sumatra which cover; (i) Aceh; (ii) North Sumatra; (iii) West Sumatra; (iv) South Sumatra, Jambi, and Bengkulu; (v) Riau and Riau Islands; (vi) Bangka Belitung; and (vii) Lampung (Distribution unit). They are responsible for the construction, operation, and maintenance of Distribution network. 12. Under the new organization structure, Environmental Planning and Management Sub- Division has new name as Division of Health, Safety, Security and Environment (K3-L)4 under the Director of Human Capital Management (previously under Director for Construction). The Division of K3-L is divided into two sub-division: Health, Safety, Security and Environment. Under Senior Manager of Environment there are Deputy Manager (DM) for Planning and Deputy Manager for Operation. DM for Planning is responsible for reviewing safeguards document for project preparation and DM for Operation is responsible for monitoring and evaluation of Wilayah performance in environmental and social management via SILM (Sistem Informasi Laporan Management – Information System for Management Report). 13. Division of Distribution has also shifted from Director for Construction to Regional Directors who is the main unit responsible in the Program for planning programming. 14. PLN headquarter is responsible for policy matters whilst the staff in Wilayah is responsible for the delivery. PLN headquater role is to monitor and evaluate environmental and social safeguards issues all over the country. PLN has long experience in dealing with World Bank safeguards policies. PLN has implemented Bank projects in the past and PLN staffs have received sufficient training over time on the Bank's environmental and social safeguards policies and their implementation. Within PLN itself, to improve the quality of staff the Education and 4 Divisi Keselamatan, Kesehatan Kerja, Keamanan dan Lingkungan (K3-L) 5 Training Center of PLN provides trainings (including training on environmental and resettlement safeguards) two times in a year. All staffs are entitled to select and attend the trainings. 15. High-Risk Activities. During preparation, it was confirmed that the Program will not include high-risk projects that requires preparation of EIA documents (as per the Ministry of Environment Regulation (PERMEN) No: 05/2012 on Activities requiring AMDAL). The Program will exclude construction of power plant, main substation (Gardu Induk) or power transmission network line that under the PERMEN No 05/2012 would be classified as activities requiring full environmental assessment that is locally known as AMDAL. Activities requiring AMDAL are the ones likely to generate the most adverse environmental and social impacts and would correspond to Bank Category A projects, under investment lending operations. 1.2 Typology of Works 16. Table 2 summarizes the typology of construction work to be implemented through the Program. 6 Table 2: Typology of activities which will support the Program Activities Pictures of scompleted work Pole and Grid installation In most cases however, the poles will be installed along the right of way (ROW) of existing roads owned by the district/provincial government. Besides the new poles, the distribution expansion can take place in form of double feeder system (i.e. network expansion using the same pole) Distribution substations (Gardu Distribusi) installation. There are two typical distribution substations to be procured and installed. i) Gardu Cantol, i.e. distribution transformer that is mounted to a single pole ii) Gardu Portal, i.e. distribution transformer that is installed on a pad (platform) created by two poles Switching substation (Gardu Hubung). The landed power distribution facility is to improve the reliability of power supply. Construction of switching substations will require an area of approximately 48 m2. 7 1.3 Main Stakeholders related to the Program 17. The main stakeholders related to the Program implementation are PLN at HQ and Wilayah (including Area and Rayon) and contractors. Wilayah has several sections and units involved in planning, design, implementation and supervision of the power distribution works 18. In HQ level, Division of Health, Safety, Security and Environment (K3-L) is responsible for monitoring and evaluation of Wilayah performance in environmental and social management via SILM (Sistem Informasi Laporan Management – Information System for Management Report). 19. The seven Wilayahs are responsible for the construction, operation, and maintenance of Distribution network and reporting through SILM to HQ. 20. Other stakeholders include in the Program are provincial, district and city government in order to coordinate permit and implementation of the construction. Implementation of the Program requires principle permit (Ijin Prinsip) and other permits (e.g. building construction permit for switching substation, cutting trees) from local government prior construction. Wilayah is responsible for dealing with the permits while Area is responsible for dealing with ROW acquisition and possible removal/cutting trees within a distance of 2.5 m of the poles and handling any grievances/complaints from the communities in term of environmental and social issues both during and post construction. 8 2 PROGRAM CONTEXT AND POTENTIAL IMPACTS 2.1 Environmental Context 21. The westernmost and second largest island (after Borneo) of Indonesia, Sumatra (473,970 sq km) is 1,790 km long and 435 km wide and is fringed with smaller islands off its western and eastern coasts. The Bukit Barisan, a volcanic mountain range with more than 30 active volcanoes, traverses its length, reaching 3,800 m at Mt. Kerinci. Rising in the Barisan range are several large rivers, including the Hari, Indragiri, and Musi; some rivers are developed for hydroelectric power. In the north is the great salt lake Toba (1,140 square km), the largest of many mountain lakes. Sumatra’s climate is hot, except in the highlands, and extremely moist. Because of these, the vegetation is luxuriant, and much of the eastern half of the island is swampland. The interior is covered largely by impenetrable rain forests. Among the native animals are elephants, clouded leopards, tapirs, tigers, Malayan bears, and snakes. Three national parks on the island—Mount Leuser, Kerinci Seblat, and Bukit Barisan Selatan—collectively were designated a UNESCO World Heritage site in 2004. 22. The Sumatra is administratively subdivided into ten provinces. Majority of the population lives in rural areas; the highest population density is around Medan in North Sumatra Province. Road networks are fairly good across the Sumatra and its smaller islands off its western and eastern coasts (e.g. Bangka Belitung and Riau Archipelago). The high economic growth spreads over island with growth center at capital of the province (e.g. Medan, Pekanbaru, Palembang, Lampung) while most of the energy resources are located in the south. Thus power flows from south to north. Figure 1 shows the typical peek time load flow pattern (Annex 1: Sumatra Island existing and future development power transmission lines). 9 Figure 1: Load Flow of Sumatra Interconnection Systems at Peak Time (June 2015) 2.2 Potential Environmental Impacts 23. Any activities requiring AMDAL that would be classified as Category A under WB Safeguard Policy and it will not qualify for PDDP support. In addition activities located in or directly adjacent conservation areas (e.g. protected areas/forest: national park, wildlife sanctuaries/reserves) shall be excluded from the Program (Annex 2 Existing protected areas in Sumatra) 24. Expansion and reinforcement of distribution network (including installation of distribution transformers, poles, service connections and feeders, and customer meter boxes and circuit breakers) will take place in rural and urban in areas already electrified (with existing access roads available) and therefore the potential impact on environmentally sensitive areas is not likely. 25. All activities potential construction-related impacts include disturbance of traffic, access disturbance, vegetation, noise, dust, vibration and waste. Transportation of equipment and materials (i.e. poles, transformers) may generate some noise, dust and traffic. Potential impacts 10 prior to construction stage include trimming of trees within the ROW of distribution lines (Distribution network), noise and traffic. 26. Potential risks to occupational and community health and safety include electromagnetic field (EMF) is low as it is under 20kV. All the impacts and risks are reversible and site- specific, and can be mitigated and/or managed by PLN's current practices. 27. Based on the site visits to the recently completed and ongoing PLN power distribution project, the following activities and impacts have been identified to be typical of the distribution activities:  Installation of new poles: noise, dust, construction debris;  Cutting/trimming of vegetation/trees: occurring along the ROW for the power grid; but it can also affect private own trees.  Management and storage of power cable, poles and transformers along ROW: traffic and access disruption;  Traffic control and public safety: traffic issues during materials and equipment shipment and construction (e.g. pole erection, heavy equipment mobilization) can generate accidents, and safety problems;  Occupational health and safety of workers and contractors. 28. The sources of construction materials and equipment for distribution work:  The concrete poles, transformers and cable are to be supplied by PLN Supply Chain Management (SCM), through internal purchase order by Wilayahs  Other supporting construction material (e.g. cements, sand and gravel for switching substation construction) will be obtained locally. 2.3 Potential Social Impacts The Program is expected to generate many benefits, such as (i) number of residential customers connected, (ii) reduction in SAIFI5 and SAIDI6, (iii) improved voltage profile, (iv) reduction in distribution losses, GHG emission reductions, (v) volume of additional energy sales (increase in TWh), (vi) increased procurement transparency, and (vii) increased efficiency in program implementation. 29. The potential of social impacts related to the construction activities of the Program are expected to be low as well as impacts related to land acquisition. As a general rule, the installation of poles takes place within existing ROW and, therefore, do not require the acquisition of additional land or cause physical or economic displacement. In most cases however, the poles will be installed along the ROW of existing roads owned by the district/city/provincial government and possible removal/cutting trees located within a distance 5 The System Average Interruption Frequency Index (SAIFI) is commonly used as a reliability indicator by electric power utilities. SAIFI is the average number of interruptions that a customer would experience. 6 The System Average Interruption Duration Index (SAIDI) is commonly used as a reliability indicator by electric power utilities. SAIDI is the average outage duration for each customer served 11 of 2.5 m of the poles. Installation of distribution transformers can be attached in one pole called gardu cantol or use two poles to support the platform called gardu portal, while switching substation has a stand-alone building (see Table 1). 30. For installation of concrete poles (< 0,2m2) including installation of distribution transformers, it is common practices in rural and urban areas for communities in need of electricity to donate a small piece of land to Wilayah. The location of poles can be changed if necessary to avoid potential social impact. Even within the same alignment, the contractors are able to avoid disturbance of non-land assets (mainly trees) by setting the height of poles and conductors higher or by replacing the bare cable with an insulated cable which can go along/through obstacles including trees. This flexibility allows PLN to optimize the alignments of distribution lines including the locations of the poles taking into full consideration the opinions/requests of the stakeholders. PLN’s practice is to minimize the siting of concrete poles on private lands and to avoid disturbance of non-land assets to the maximum extent possible or else to obtain the owners’ agreement well in advance during the planning stage for the use of private land for utility poles and cutting down of a few tress. The poles include distribution transformers may also be installed on the premises of customers who require power at the primary distribution level such as real estate, shopping center, industrial estate. 31. In the case the Program affects to non-land assets that cannot be avoid and need to be removed or cut, the owners will be provided with a “cutting cost” for the affected trees or compensation for other non-land assets, if any, only if requested by the affected persons. The “cutting cost” or compensation, if any, is handled by contractors based on negotiated settlement referring to the local market rates of the assets. The cost of compensation is borne by the contractors as part of the mobilization cost needed for the clearance of the project site. The budget for such compensation is covered by their overheads, contingency, and profit. However, in Palembang there is a good practice that compensation for a few of affected trees is given in kind, i.e. new trees. Type and value of compensation on trees it depends on mutual agreement both parties. 32. The Program activities related to extension of switching substations (including installation of reactors and capacitors and expansion of switchgears) will give priority by optimizing the existing substations owned and managed by PLN. However, if the existing substation has the capacity overloaded, to increase the reliability of the supply, a new substation will be constructed. Nevertheless, the number of new switching substation in the Program would be limited. New switching substations would need small piece of land (6x8 m2) and would be obtained by Wilayahs through direct purchase from landowners on the basis of willing buyer willing seller. Since land acquisition is limited, and there is no physical or economic displacement so impacts on the individual affected persons is to be minor. 33. Indigenous peoples or ethnic minority. The Program will be implemented based on mutual agreement between PLN and the community including indigenous people or ethnic minority. Without mutual agreement, PLN Wilayah will not implement the work at the sites. Distribution expansion is a routine work and the main activity of Wilayah. Before construction, PLN does consultation and provides preliminary information about distribution activity plan. Contractor also conducts consultation and information before construction. Results of public consultation in five Wilayahs showed all parties including indigenous people or ethnic minority 12 support and even requested the PLN to accelerate implementation of the Program. In order to allow fast implementation, impact on social and environmental shall be minimum, thus for this reason, the Program will avoid work in forest or conservation area or protected forest that needs environmental permits from Ministry of Environment and Forest. Representatives of indigenous groups participated in the public consultation and mentioned that the program should benefit and bring positive impacts to the groups. They encourage PLN to provide electricity access to all citizens and request the PLN not to ignore their existence. The groups also mentioned that they have been waiting for electricity connection for long time and will participate in consultation process prior to the construction to reach consensus on how the Program will be implemented. 2.4 Mitigation and Prevention Measures to Reduce Environmental Impacts 34. The PLN Decrees specifies details measures to prevent, reduce and mitigate impacts during constructions of distribution lines. Example of the contract documents for distribution works shows strict provisions and measures aiming for good construction work practice are stipulated in the contract. Some of these measures are listed below.  Follow the instruction of PLN Decree on construction of distribution lines (e.g. installation of poles including cable distribution transformers, switching substation) to reduce negative effect due to noise, dust, rock debris and traffic disruption  Minimize cutting/trimming of vegetation along the ROW for the power cable grid; ensure the permit is granted by the authority, and if the tree is privately owned, ensure prior agreement with trees owner has been obtained or compensation has been paid before construction.  Implement good management and storage of power cable, poles and transformers along ROW to minimize impact on traffic and access disruption.  Place staff to control road traffic and install traffic and prevention signs along the road of working area to prevent accidents, in particularly during materials and equipment shipment and construction (e.g. pole erection, heavy equipment mobilization)  Ensure occupational health and safety measures to ensure workers safety (e.g. personal protection equipment).  Avoid construction works during peak traffic hours and if necessary place road signaling and light  Make appropriate waste management rules to handle domestic and hazardous wastes (e.g. transformer oil leakage). 13 3 ENVIRONMENTAL MANAGEMENT SYSTEM 3.1 Institutional Responsibilities 35. Institutional arrangements for implementation. The program will be administered by a central Program Management Office (PMO) located at PLN HQ, but the physical implementation activities will be carried out by Wilayahs as Program Implementing Units (PIUs). Wilayahs have been carrying out similar programs over the years and are experienced and capable of managing the distribution construction work envisaged under the Program. All implementation activities will be carried out by the respective contracts divisions within each Wilayah and overseen by the distribution systems manager under the Wilayah General Manager. The PMO supported by the Wilayahs will bear overall responsibility for the work program, quality and timeliness of the program works, and its satisfactory completion. Figure 2. Institutional and Implementation arrangement 3.2 National Regulatory Framework 36. National Policy and legal frameworks on EA. The first EIA in Indonesia was carried out in 1972, since then the environmental awareness has constantly increased and culminated in 1982 when the first Law no 4/1982 on the Principles on Environmental Protection. Since then the environmental regulation and legislation has evolved and nowadays, more than 50 in form of laws, government regulation (PP), ministerial regulation and decrees (PERMEN and Kepmen) and other regulations applicable to the environmental management of the Program; this regulatory framework provides reasonable assurance that the environment will be protected from negative impact stemming from PDDP implementation. For instance, the country has legislation that requires environmental impact assessment, protects the native forest and endangered species, 14 controls water pollution, and enforces health and safety at work sites, management of hazardous wastes among others. The EIA in Indonesia is known as AMDAL (Analisis Mengenai Dampak Lingkungan or EIA), an assessment report on the significant impacts of business or activities on the environment which is necessary for the process of the decision making regarding the implementation of the business/activities. Following the first law on the environmental protection that mentions the need for an activity to carry out AMDAL, that is the Law No 4/1982 and subsequently few amendments with the latest in in 2009 (i.e. Law No. 32/2009 Regarding Environmental Protection and Management), the GOI enacted Government Regulation (PP) No. 27/2012 on Environmental Permit, which outlines environmental assessment process (and instruments) required for activities potentially generating negative environmental and social impact. Then to streamline the implementation of PP No. 27/2012, the Ministry of Environment (MOE) enacted MOE Regulations (PERMEN) No. 05/2012 on Type of Activities Requiring AMDAL, PERMEN No.16/2012 on Guidelines for Preparation of Environmental Documents, PERMEN No. 17/2012 on Guidelines for Public Participation in AMDAL Process and Environmental Permit. The public participation the requirements of AMDAL, UKL/UPL7 (Upaya Pengelolaan Lingkungan Hidup / Upaya Pemantauan Lingkungan Hidup or environmental management efforts and environment monitoring efforts) or SPPL8 (Surat Pernyataan Kesanggupan Pengelolaan dan Pemantauan Lingkungan Hidup or letter of commitment for the environmental management plan [EMP] and environmental monitoring plan [EMoP]), environmental permit process, guideline of environmental documents’ preparation, requirement of community involvement, public consultations (socialization) and grievance redress mechanism, and implementation and monitoring of appropriate mitigation measures to address adverse environmental impacts. 37. The requirement for environmental assessment in Indonesia is based on the prescribed list in the PERMEN No 05/2012 on the activities requiring AMDAL. Though general, the list includes the information on the size and potential impacts of the activities that warrants the full assessment (AMDAL). Activities tough listed but because the scale of impact or the size of activities is small will either require of partial environmental assessment (UKL/UPL) or letter for environmental management and monitoring commitment from proponent (SPPL). Three possible environmental categories are:  AMDAL: projects are considered to cause significant environmental and social effects. The regional environmental agency (BLH or BPLHD 9) and the proponents shall request the proponent to present a full EIA, made available a summary of the EIA to different stakeholders and perform two-round public consultations of the project, e.g. coal fire power plant (> 100MW), transmission line (> 150 KV), any activities within or adjacent to protected areas 7 UKL-UPL pertains to the management and monitoring efforts of business/activities that have no significant impacts on the environment, which are necessary for the process of the decision making regarding the implementation of the business/activities. 8 SPPL is a statement regarding the undertaking to monitor and manage the environmental impact of business/activities which are exempted from the AMDAL or UKL-UPL requirement. 9 BLH or BPLHD is regional environmental agency, it includes city, district ( kabupaten) and provincial level. The term of BPLHD is used at the provincial level of environmental agency, for any activities affecting more than one city/district, the clearance is from BPLHD, activities crossing provincial jurisdiction will need clearance from central environmental agency (KLHK = Ministry of Environment and Forestry) 15  UKL/UPL: project with moderate potential environmental and social impacts. The project proponent Developers shall request clearance or environmental permit from the local environmental agency (BLH or BPLHD) presenting environmental management and monitoring effort, e.g. construction of main substation (Gardu Induk) SPPL: projects with low impact, e.g. routine road maintenance work, in this case, the project proponent submitted the SPPL to city/district BLH to obtain clearance. 38. In addition, Government Regulation No. 101/2014 Regarding Management of Toxic and Hazardous Waste Substances regulate the management and disposal procedures for toxic and hazardous waste substances. Law No. 14/2008 Regarding Public Information guarantees the provision of correct information to the public as a form of public services. Law No. 13/2003 Regarding Manpower and Government Regulation No. 50/2012 Regarding Practice of Health and Safety Management System ensure the right of every worker to protection, health and safety to achieve optimal work productivity, and require implementation of a health and safety system. Presidential Decree No. 32/1990 Regarding Management of Protected Area and Law No. 11/2010 Regarding Physical Cultural Resources regulate the procedures and mechanism for the preservation of protected area and cultural heritage respectively. 39. The GOI legal framework exempts distribution development activities from having an environmental assessment prepared provided they are not located in or directly adjacent to protected areas. However, considering that the scale of the impact is reversible and site-specific and that environmental mitigation measures are implemented following the PLN Decrees, the current practices will be sufficient to manage the environmental impacts. According to PLN regional offices/units, no outstanding issues/complaints regarding adverse environmental impact caused by distribution development has ever been reported to date. 40. Site visit to Wilayahs distribution system warehouse and one of coal power plant, the team found notable spill of oil was observed. Management of hazardous wastes will need to be improved to ensure it complies with PLN10 SOP for handling hazardous waste. The management of industrial waste can be improved in terms of avoiding and managing oil spillage and utilizing only a licensed third party when disposing hazardous wastes. 41. Assessments undertaken are of the view that the environment safeguards system currently in place through the GOI’s environmental laws and regulations as well as PLN’s internal guidelines (PLN Decrees) are sufficient to comply with the World Bank policy OP 9.00. Table 3. Main regulations applicable to the operation of the PLN Program Regulation Description and PLN compliance Environmental Law No. 32/2009 on Environmental Main Indonesia legislation aims to protect the environment from Protection and Management development activities. The PLN has strong commitment toward environmental protection and sustainability, the company has ISO 14001 (on Environmental Management System) certification since 2004 10 PLN has valid license to temporary store the hazardous waste. 16 Law No. 14/2008 on Public The law assurances the provision of correct information to the public Information as a form of public services Government Regulation No. 27/2012 The regulation requires any activity/business potentially generating on Environmental Permit negative environmental and social impact to obtain an environmental permit. The regulation also outlines environmental assessment process and instruments( i.e. AMDAL or UKL/UPL) required for proposed activity/business. The PLN complies with the regulation requirement by obtaining the environmental permit and implementing agreed environmental action plans (i.e. RKL/RPL or UKL/UPL) for its operation of power plant, transmission, main substation. Government Regulation No. 101/2014 Government Regulation No. 101/2014 on Management of Toxic and on Management of Toxic and Hazardous Waste regulates the proper management of hazardous waste Hazardous Waste covering; (i) method of identifying, reducing, storing, collecting, transporting, utilizing, processing, and disposing of hazardous wastes; (ii) risk mitigation and emergency responses to address environmental pollution caused by hazardous waste. The country management of hazardous waste is based on the principle “cradle to grave”. Used transformer oil is classified as hazardous waste. Though the PLN has valid license to temporary store the hazardous waste, for final disposal/treatment, it has agreement with the third party who has the valid license to manage the hazardous waste. Government Regulation No. 50/2012 The regulation ensures the right of every worker to protection, health on Practice of Health and Safety and safety to achieve optimal work productivity, and requires Management implementation of a health and safety system. Presidential Decree No. 32/1990 on The decree declares the need to establish protected areas in order to Management of Protected Area ascertain the sustainable development and protect bio-diversity. It provides basic definition of protected areas, process to establish and to manage protected areas. Under this Program, any activity within or adjacent to the protected areas will be excluded. Ministry of Environment (MOE) The regulation prescribes list of activities that are potentially regulation (PERMEN) No. 05/2012 on generating adverse impact and therefore require full environmental Type of Activities Requiring AMDAL assessment The distribution line extension is not covered under the PERMEN as the activities are considered to have low impact on environmental and social PERMEN No.16/2012 on Guidelines The guideline provides level of detail of environmental assessment, the for Preparation of Environmental guideline also requires community involvement, public consultations Documents (socialization) and grievance redress mechanism, and implementation and monitoring of appropriate mitigation measures to address adverse environmental and social impacts PERMEN No. 17/2012 on Guidelines The regulation stipulates the requirement to carry out public for Public Participation in AMDAL consultation as part of the process for preparation of AMDAL (full EA Process and Environmental Permit - twice) and UKL/UPL (Partial EA - once) Social Law No. 02, 2012 on the land Construction of power distribution or extension is included in public acquisition for development of public interest PLN will buy the land (if necessary) on willing sell and willing interest buy basis. Valuation of affected assets must be valuated by licensed appraiser. 17 Presidential Regulation No. 71 of PLN will buy the land (if necessary) on willing sell and willing buy 2012): Technical guideline for basis. implementation of land acquisition for public purposes Presidential Regulation No. 40 of 2014 Land acquisition for less than 5 Ha can be executed with direct land acquisition of size < 5 ha purchase or land swab or other forms as agreed by both parties. PLN Decree No.0289/2013 Regarding Covers (i) direct land acquisition to be used for tower siting, major Land Acquisition for the Purpose of electricity main substation, network, transmission, distribution, power Providing Electricity, Operational plant, office, etc. by giving compensation; and/or (ii) indirect land Costs of Land Acquisition and acquisition for creating free space by giving compensation on the land Operational Cost of Compensation11. crossed by electricity network and transmission and by giving compensation on the plants and buildings. 11 PLN.2013. Keputusan Direksi PT PLN (Persero)/Nomor:0289.K/DIR/2013 Tentang Pengadaan Tanah Untuk Kepentingan Penyediaan Tenaga Listrik Biaya Operasional Pengadaan Tanah Dan Biaya Operasional Kompensasi Di Lingkungan 18 Safeguard Application to PDDP Subproject Environmental category of the Program 42. Based on the assessment of the current PLN practices, as a corporate entity, PLN adopt and comply with the PERMEN 05/2012 on the conduct of environmental assessment in securing the environmental clearance for construction of power plant, main substation and transmission network as well as with other laws and regulations related to solid wastes, hazardous wastes, pollution control, forest management, environmental monitoring and reporting, information disclosure, and community involvement. For distribution network activities where the requirement for environmental impacts assessment are not covered by GOI’s legal framework (i.e. PERMEN 05/2012), environmental mitigation measures are specified in Decree of the Board of Directors of PLN (PLN Decree) No. 473/2010 on Construction Standard for Low Voltage Power Network12 and PLN Decree No.606/2010 on Construction Standard for Medium Voltage Power Network13, PLN Decree No.605/2010 on Construction Standard for Power Distribution Substation and Switching Substation which are then implemented. PLN implements good practices on managing environmental impacts such as meaningful consultation (socialization), provision of waste storage and segregation, and use of environmentally accepted equipment such as non-polychlorinated biphenyls (PCB) transformers. To address the potential risks on workers’ health and safety, SMK3 (Sistem Manajemen Kesehatan dan Keselamatan Kerja or occupational health and safety management system) was established by PLN respectively for transmission, main substation and distribution, which is well implemented. 43. Grievance Mechanism. PLN has a well-established management system in handling any grievance/complaint from public that all over the country, namely Call Center 123 and front line i.e customer services. Through Call Center 123 which can be accessed by anyone anywhere in Indonesia through website, email, telephone and social media (e.g. facebook, twitter); Wilayahs immediately act on community complaints including those related to construction impacts, environment, community health and safety, and social issues, by deploying PLN technical service responders. 12 PLN.2010. Lampiran Keputusan Direksi PT PLN (Persero)/Nomor:473.K/DIR/2010 Buku 3 – Standar Konstruksi Jaringan Tegangan Rendah Tenaga Listrik 13 PLN.2010. Lampiran Keputusan Direksi PT PLN (Persero)/Nomor:606.K/DIR/2010 Buku 5 – Standar Konstruksi JaringanTegangan Menengah Tenaga Listrik 19 Figure 3. PLN Call Center 123 accessibility 44. There is a monthly record for all grievances and complaints sub-grouping into type issues (i.e. power outage, location of poles) and also reports on outstanding issues. The role of Area is to verify the issues and resolve the grievances/complaints within 24 hours referring to their standard operational procedure. Grievances or complaints from communities could be related implementation of the construction during and post construction. 45. Monthly report from the Call Center 123 summarizes the complaint handling performance (e.g. number of power outage, resolution of complain, outstanding issue etc.) that become one of the data to calculate and SAIDI and SAIFI of the Wilayahs. Once compiled, the information will be uploaded into SILM. One of section in SILM is for the environmental management performance including social issues. Information Disclosure, Consultation and Participation. A preliminary consultation on the proposed framework of ESSA took place in PLN HQ, Jakarta on September 7th and 9th, 2015; PLN HQ and Wilayahs staffs involved in design, construction, supervision, maintenance in distribution, as well as PLN Headquarter Environmental Unit consulted on the preliminary findings of the assessment, the strengths, risk and proposed action plan. Inputs from the consultation were included in the action plan. Draft ESSA has been disclosed on October 16, 2015 at the Infoshop (English version) and PLN web sites (Indonesian version). The first public consultation of draft ESSA took place in Bandar Lampung on Oct 19th, 2015, subsequently on Nov 3th and 5th, 2015 it was held in City of Banda Aceh and Tanjung Pandan (Belitung Island) respectively. Two more consultations were in Palembang (South Sumatra) on Dec 10 then Padang (West Sumatra) on Dec 11. Representatives of various local governments (provincial, district/city level) agencies, local universities, communities/ethnic groups and civil society participated the public consultation. In each consultation, Bank staff presented detailed information on the PforR process, the proposed 20 Power Distribution Development Program, the key findings and recommendations of the ESSA. Representatives of indigenous groups also participated in the public consultation and voiced that the program should benefit and bring positive impacts to the groups. They encourage PLN to provide electricity access to all citizens and request the PLN not to ignore their existence. The groups also mentioned that they have been waiting for electricity connection for long time and will participate in consultation process prior to the construction to reach consensus on how the Program will be implemented. Inputs received during consultations were positive toward the Program implementation though some criticized poor service quality of the PLN (notably was the outage). Inputs/feedback from these consultations are included in the Annex of the final version of the ESSA. 21 Summary of the Environmental Management Process in the Program. Table 4 describes implementation procedure including environmental management in the distribution extension execution. Table 4. Main processes of the Program implementation and environmental management Process Tasks Timing and Responsible Parties Phase Planning and - Distribution extension designs plans Annual RUPTL by PLN HQ design (RUPTL) are prepared PLN Wilayah Preparation Annual PLN Wilayah - Screening to exclude high risk activity (e.g. distribution extension within or adjacent the protected areas/forest area) Annual and As - Permits request to particular agencies necessary (e.g. for trimming/cutting of trees from authorized district/city agency or owner, construction permit (IMB) and principle permit from district/city agency). Decision - Permits are granted Implementation Relevant agencies in process district/city government Bidding - Bidding documents are prepared and Implementation PLN Wilayah documents and health, safety and environmental selection of provision are included into bidding contractors documents. - Contractors selected, signed of contracts - Construction implementation by Implementation PLN Wilayah requests Execution contractor, material is supplied by material from SCM, MDU (Material Distribution Unit) in Contractor selected by PLN Wilayahs Wilayahs Reporting - Contractors report for deliver the work Implementation Contractor as per contract provision - Contractors must inform the final clean up and restoration of the site as necessary 3.3 Program Capacity in the Environmental Management - Performance Assessment 46. Regulatory Framework: The PERMEN 05/2012 covers the activities that requires full environmental assessment (Category A as per OP 4.01) and partial EA. The GOI’s environmental screening as per PERMEN No. 05/2012, Appendix 1 uses a prescriptive list with thresholds of proposed activity whereas Bank screens based on the significance of impacts. The program will adopt screening criteria to exclude the activities located in or directly adjacent to protected areas. The GOI legal framework exempts distribution line projects from environmental 22 assessment requirement. Therefore an environmental assessment is not conducted for installation of distribution line. 47. Environmental instruments: For construction of distribution lines, the PLN Decree No. 473/2010 on Construction Standard for Low Voltage Power Network, PLN Decree No.606/2010 on Construction Standard for Medium Voltage Power Network and PLN Decree No.605/2010 on Construction Standard for Power Distribution Substation and Switching Substation has adequate measures to ensure impact on environmental is minimized. 48. Monitoring and Supervision: Wilayah conducts regular14 environmental monitoring during construction of distribution lines. Wilayah submits to PLN HQ a quarterly report (K3-L15 Activity Report) which includes the result of the monitoring of implementation of SMK3 and environmental and social issues, if any. 49. Staffing and Training: The HQ staff is responsible for policy matters whilst the staff in Wilayah is responsible for the delivery. K3-L Division Staff especially who handle environmental and social safeguards, have four fulltime staff. Their role is to monitor and evaluate environmental and social safeguards issues all over the country. PLN has long experience in dealing with World Bank safeguards policies. PLN has implemented Bank projects in the past and its staff has received sufficient training over time on the Bank's environmental and social safeguards policies and their implementation. Within PLN itself, to improve the quality of staff the Education and Training Center of PLN provides trainings (including training on environmental and resettlement safeguards) two times in a year. All staff is entitled to select and attend the trainings. 50. Grievance Mechanisms: See Para 44 51. Coordination within PLN: the PLH HQ in charge for K3-L coordinates very closely with the staff at Wilayahs level. Internal meetings among the staff of PLN HQ and Wilayahs are performed in regularly basis. In the proposed action plan, some measures will be included to increase effectiveness in the environmental coordination and increase digital reporting (e.g. SILM) and communication. These actions will be especially important as part of the capacity building program for staffs at PLN Wilayahs to implement the environmental best practices in their works program. 3.4 Relevance with the Principles of OP 9.00 52. This section presents the assessment of the extent to which the applicable environmental and social systems are consistent with the core principles and attributes of PforR. It is also necessary to indicate the willingness of the PLN to undertake the necessary measures to improve environmental and social system performance in key areas. 14 Environmental monitoring is conducted twice a year, measuring of ambient air quality, surface water quality, and noise levels, the quantities of hazardous waste generation are also monitored. Environmental monitoring reports are submitted to environmental agency (BLH/BPLHD) semi-annually. 15 K3-L electricity safety, occupational health, safety and environment 23 53. Relevance of the Program and exclusion criteria for PforR support. The PforR type of lending excludes the support of projects with significant and irreversible impacts (Category A). The Program does not involve investments in construction of power generation, transmission, main substation or other distribution activities that are within or adjacent to protected areas (as per PERMEN 05/2012, Article no 3) would require AMDAL. 54. The Program system and its relation to the PforR core principles and key elements (attributes). PLN HQ and Wilayahs have in general good environmental management practices and the country appropriate environmental regulations. There are areas for improvement particularly in making sure that measures to protect community and workers health and safety during construction are strictly practiced and enforced. The Program system is consistent with the core principles and key elements (attributes) of OP9.00. 55. Significance of Gaps. This assessment concludes that these gaps do not pose a risk to the achievement of Program results, provided the client commits to the implementation of the agreed Program Action Plan (PAP). 56. Borrower willingness to implement measures to improve systems performance. Further discussions about the PAP have revealed PLN commitment in implementing recommendations and improve environmental, health and safety performance. The budget of the Program Action Plan will be disbursed through the PLN annual budget. 24 4 SOCIAL MANAGEMENT SYSTEM 57. Social issue management in Indonesia system in generally divided into two areas, i.e. social issue related to land acquisition and non-resettlement social issue. The later issue is generally covered under the environmental impact assessment while for the land acquisition is covered under separated document called LARAP. 58. PLN does preliminary survey with meaningful consultation. Socialization of the project plan includes consultation that may affect to non-land assets (in general is a few of trees) and agreement from land owners for use of land in case poles need to be located on private land and removal or cutting down the affected trees. It is usually sufficient to obtain a verbal agreement from the landowners. 4.1 Institutional responsibilities 59. Both environmental impact assessment and LARAP is prepared by project proponent. The environmental impact assessment which includes social impact assessment beyond the resettlement issue should obtain clearance from the regional office of environmental agency (BLH/BPHD), while the LARAP will follow the provision of Law No 2/2012 on land acquisition for development of public interest. The Law No 2/2012, the land acquisition will require the project proponent to carry out feasibility study to assess the feasibility of the proposed sites from technical, cost/finance, environmental and social matters, and among the institutions involved in LARAP process are Land Agency (BPN), relevant agencies within city/district government (including the village level). Land acquisition for less than 5 ha, as stipulated in Presidential Regulation No 40 of 2014 can be obtained by direct purchase by the project proponent on the basis of business to business thus LARAP document is not required. Application of this procedure will be a common practice in this program because all of the land acquisition for each switching substation will be much less than 5 ha. The Wilayah will be responsible for acquiring land for the switching substation Prior to the Program implementation in the proposed area, Wilayah will also have to get concurrence from local communities and principles permit (i.e. location permit). 4.2 Description of the regulatory framework 60. Currently, the Government of Indonesia has few legislation relating to land acquisition to be carried out for projects of public interest (Law No. 2 of 2012; Presidential Regulation No. 71 of 2012); and technical guidelines issued by the relevant ministries16). Refer to Presidential Regulation No. 40 of 2014 land acquisition for less than 5 Ha can be executed with direct purchase or land swab or other forms as agreed by both parties. 61. These law and regulations cover the land acquisition required for “development of public interest” which is assigned to state-owned enterprises by the government. Land acquisition for the purpose of providing electric power which is not based on the assignment given by the government shall be regulated by PLN Decree No.0289/2013 Regarding Land Acquisition for 16 Regulation of Head of BPN No. 5 of 2012 concerning with technical guideline for implementation of land acquisition for public purposes.; Regulation of Ministry of Home Affair No. 72 of 2012 concerning with operational and supporting cost for implementation of land acquisition for public purposes uses APBD (local budget); Regulation of Ministry of Finance No.13/PMK.02/2013 concerning with operational and supporting cost for implementation of land acquisition for public purposes uses APBN (state budget). 25 the Purpose of Providing Electricity, Operational Costs of Land Acquisition and Operational Cost of Compensation17. PLN Decree No. 0289/2013 covers (i) direct land acquisition to be used for tower siting, major electricity main substation, network, transmission, distribution, power plant, office, etc. by giving compensation; and/or (ii) indirect land acquisition for creating free space by giving compensation on the land crossed by electricity network and transmission and by giving compensation on the plants and buildings. 4.3 Program Capacity in the Social Area and Performance Assessment 62. Program capacity and performance in the social area appears to be generally good, based on the above and the gap analysis carried out in Section 5 below. The evaluation is based on the review of the relevant regulatory framework, analysis of internal procedures of PLN, and field visits to alignment of distribution lines include the existing switching substation. Again health and safety of the communities and workers during construction needs to be improved and environmental health and safety measures need to be practiced and strictly enforced all the time. 63. It is assessed that there are no significant gaps between program practices and principles and elements of the OP 9.00; however, there are few areas that could be strengthened, as detailed below. 4.4 Relevance to the Principles of OP 9.0 64. This section presents the assessment of the extent to which the applicable environmental and social systems are consistent with the core principles and attributes of PforR. According to the Guidelines of PforR, it is necessary to provide a fair assessment if the Program system is consistent with the core principles and attributes of OP 9.00. It is also necessary to indicate the willingness of PLN to undertake the necessary measures (Action Plan) to improve environmental and social system performance in key areas. 65. Relevance of the Program System and exclusion criteria for PforR support. The PforR type of lending excludes the support of projects with significant and irreversible impacts (Category A). The Program only develop distribution lines and does not allow the Program activities on protected area/forest or forest area and affect to physical or economic displacement that would normally be considered environmental risk Category A under conventional investment lending criteria. 66. The Program system and its relation to the PforR core principles and key elements (attributes). PLN applies general good environmental and social management practices and the country relevant land acquisition regulations. The Program system is consistent with the core principles and key elements (attributes) of OP 9.00 see details on Section 5 and 6. 67. Significance of Gaps. This assessment concludes there are no significant gaps and no pose a risk to the achievement of Program results. 17 PLN.2013. Keputusan Direksi PT PLN (Persero)/Nomor:0289.K/DIR/2013 Tentang Pengadaan Tanah Untuk Kepentingan Penyediaan Tenaga Listrik Biaya Operasional Pengadaan Tanah Dan Biaya Operasional Kompensasi Di Lingkungan 26 68. Borrower willingness to implement measures to improve systems performance. Para 76 has Further discussions about the Program Action Plan have revealed PLN’s commitment in implementing recommendations (see Section 6). The budget of the Program Action Plan will be funded by PLN budget. The assessment was carried out by: i) Document reviews on GOI’s laws and regulations pertaining to safeguards, PLN’s guidelines and guidance related to activities under the program scope and safeguards, and other PLN’s documents such as Call Center 123 reports, SILM on environment including social issues. ii) Meetings and extensive discussions with key PLN staff handling safeguards both from headquarter (HQ) and Wilayahs in West Sumatera, North Sumatera, South Sumatera, Bangka Belitung, Lampung, Aceh, and Riau; iii) Field sites at existing switching substations and distribution lines (poles and its transformer) in Padang on May 18-19, Palembang, Medan and Tanjung Pinang(Bangka Belitung)) consecutively on July 31 – August 4, 2015, included interview with field staffs and the contractor for operation and maintenance. 69. Main meetings included (i) a meeting held on 24 April 2015 in Medan with representatives of PLN HQ and regional units to share the views on the findings during the field visit in North Sumatra province; (ii) a meeting held on 7 May 2015 in Pekanbaru with representatives of PLN HQ and regional offices/units to obtain their views, suggestions and recommendations on the preliminary assessment findings and proposed actions to address gaps; (iii) a preliminary consultation meeting held on 22 May in Jakarta with representatives of PLN HQ to obtain their opinions on the first draft ESSA; and (iv) a wider consultation meeting held on 19 June 2015 in Jakarta convening PLN HQ and regional offices/units in Sumatra to obtain their views, suggestions, and recommendations on the draft ESSA. 27 5 ASSESSMENT OF PROGRAM SYSTEM 70. Table 5 summaries the PDDP evaluation of the environmental and social systems with the principles and attributes of the Operational Policy for Program for Results 9.0. It also indicates the gaps identified during the evaluation process. 28 Table 5. Evaluation of the PDDP Environmental and Social Systems and its relation to the OP 9.0018 from the World Bank. General Core Principle: Environmental and social management procedures and processes are designed to:  promote environmental and social sustainability in program design;  avoid, minimize or mitigate against adverse impacts;  promote informed decision making relating to a program’s environmental and social effects Key Elements Program System Gaps 1. Operate within an adequate legal and The requirement for environmental impact assessment (AMDAL) has regulatory framework to guide environmental been initiated in 1982 (Law 4/1982 on Environmental Management and social impact assessments at the program and Protection that was then superseded by the Law No. 32/2009). No significant gaps level. Derivative of the Law No 32/2009 is Government Regulation (PP) No. 27/2012 on Environmental Permit that further emphasizes the need to prepare an environmental impact assessment documents (i.e. AMDAL or UKL/UPL) for business or activities that potentially results in environmental and social negative impact. The PP describes the requirements of AMDAL, UKL/UPL19 or SPPL20, the permitting process, outline of environmental documents’ preparation, community involvement and public consultations, grievance redress mechanism, implementation and monitoring of management and mitigation measures to address significant negative impacts. To implement the PP requirement, few specific/technical guidelines were enacted, i.e. Ministry of Environment Regulations (PERMEN) No. 05/2012 on Type of Activities Requiring AMDAL, PERMEN No.16/2012 on Guidelines for Preparation of Environmental Documents, PERMEN No. 17/2012 on Guidelines for Public Participation in AMDAL Process On natural habitat and physical cultures resource, Presidential Decree No. 32/1990 on Management of Protected Area and Law No. 11/2010 on Physical Cultural Resources regulate the procedures and 18 Program for results financing, The World Bank http://web.worldbank.org/WBSITE/EXTERNAL/PROJECTS/EXTRESLENDING/0,,contentMDK:22748955~pagePK:7321740~piPK:7514729~theSitePK:7514726,00.html 19 UKL-UPL pertains to the management and monitoring efforts of business/activities that have no significant impacts on the environment, which are necessary for the process of the decision making regarding the implementation of the business/activities. 20 SPPL is a statement regarding the undertaking to monitor and manage the environmental impact of business/activities which are exempted from the AMDAL or UKL-UPL requirement. 29 mechanism for the preservation of protected area and physical cultural resource. On hazardous waste and pollution control, the country has ratified the Basel Convention and has its first regulation on hazardous waste management in 1994, the latest amendment was Government Regulation No. 101/2014 on Management of Toxic and Hazardous Waste. On public disclosure, Law No. 14/2008 on Public Information ascertains the public right for correct information on project and AMDAL process. On labor and occupational health and safety, Law No. 13/2003 on Manpower and subsequently Government Regulation No. 50/2012 on Practice of Health and Safety Management System warrant the right of worker for protection, health and safety to achieve optimal work productivity, and require implementation of health and safety system. 2. Incorporate recognized elements of environmental and social assessment good practice, including: (a) early screening of potential effects; PERMEN 05/2012 covers the activities or businesses that require full Distribution activities is not environmental assessment (Category A as per OP 4.01). The covered by the PERMEN environmental screening as per PERMEN No. 05/2012 applies a 05/2012, nevertheless PLN prescriptive list with thresholds of proposed activity and potential will include provision to adverse impact included. AMDAL is mandatory for business/ exclude distribution works that activities that is located in or directly adjacent to protected areas (i.e. are within or adjacent the protected forest, national park, critical habitats). The program will protected areas adopt screening criteria to exclude the activities located in or directly adjacent to protected areas. (b) consideration of strategic, technical, PERMEN No. 16/2012 on guidelines of EA document requires the No significant gaps and site alternatives (including the “no assessment to consider alternatives such as technology, project sitting action” alternative); or alignment, equipment used, technical specification etc. PLN has implemented alternatives on location, re-route, equipment, technical specifications and other design considerations during selection and planning of a project. (c) explicit assessment of: 30  potential induced impacts PERMEN No.16/2012 on Guidelines for Preparation of The GOI legal framework  cumulative impacts Environmental Documents stipulated scope and aspects to be exempts distribution line assessed in AMDAL that among other should cover geo-physical- projects from environmental chemical, biological, and social-economic-cultural and impacts assessment requirement. assessment of potential direct, indirect, cumulative and induced Therefore an environmental impacts and risks. assessment is not conducted for installation of distribution line.  trans-boundary impacts No applicable to the program No applicable (d) identification of measures to mitigate The identification of environmental impacts and preparation of the No significant gaps. While the adverse environmental or social impacts EMPs (RKL/RPL)21 to address adverse impacts is provided in distribution lines construction that cannot be otherwise avoided or PERMEN No. 16/2012. The EMPs is parts of AMDAL documents impacts is well-managed and minimized; (other are environmental impact statement (ANDAL), executive covered through the PLN summary), it contains plans to prevent, control, and manage Decrees. significant negative impacts to environment, as well as enhance the positive impact as a result of the business/activities. For Distribution, Decree of the Board of Directors of PLN (PLN Decree) No. 473/2010 on Construction Standard for Low Voltage Power Network, PLN Decree No.606/2010 on Construction Standard for Medium Voltage Power Network and PLN Decree No.605/2010 on Construction Standard for Power Distribution Substation and Switching Substation have included the mitigation measures to be taken to minimize environmental (health and safety) and social impacts during construction and operation of distribution lines. The mitigation measures include proper handling of excavated soil, minimum safety distance, appropriate selection of vehicle for transportation of poles, recovery of excavation site, adequate distance from other objects (1-6 m depending on the kind of the objects), etc. The contract of the civil works specifies the compliance of PLN Decrees No. 473/2010, No. 606/2010, No. 605/2010 21 RKL: Rencana Pengelolaan Lingkungan (Environmental Management Plan) and RPL: Rencana Pemantauan Lingkungan (Environmental Monitoring Plan) 31 (e) clear articulation of institutional Government Regulation (PP) No. 27/2012 on Environmental Permit . responsibilities and resources to support clearly mentions that the process of AMDAL and the responsibilities, implementation of plans; of each institution (e.g. the proponent responsibility for preparation AMDAL, BLH/BPLHD for clearances following the recommendation from AMDAL Committee, etc.) The Program implementation will be the responsibility of Wilayahs, each wilayahs has unit in charge for environmental and social impact management. (f) Responsiveness and accountability through:  stakeholder consultation, PERMEN No. 16/2012 and PERMEN No. 17/2012 on Guidelines for No significant gaps.  Responsive grievance redresses Public Participation in AMDAL Process and Environmental Permit measures. prescribe the requirements for community involvement and public consultation (socialization). For projects requiring AMDAL, public consultation from the AMDAL TOR preparation stage is mandatory. The community involvement during the process of AMDAL and the environmental permit should be based on the principles; (i) the provision of transparent and complete information; (ii) position of equality among the parties involved; (iii) fair and prudent dispute settlement; and (iv) coordination, communication and cooperation among the concerned parties. PERMEN No. 17/2012 also describes the grievance redress procedure for community complaints against a project. The procedure also outlines the methods and timeline for resolving complaints. For power distribution work and part of this ESSA process, The Bank and PLN has agreed to arrange a meaningful consultation with the relevant stakeholders including representative of potential affected communities prior to the commencement of the Program. The public consultation will also inform that the complaint handling mechanism via (a) Call Centre 123; and (b) front line i.e. customer services (CS) (some wilayahs have discouraged to use CS counter). The complaints to the Call Center 123 would be recorded and divided in three subjects: 1) Technical, 2) Customer services (commercial), and 3) Other (including environmental and social safeguards matters).  timely dissemination of program Government Regulation No. 17/2012 requires the disclosure of For distribution lines, 32 information environmental documents (both draft and final versions including environmental assessment is EMP) to stakeholders including affected people. not disclosed because the assessment is not required Before preparing environmental documents, a project proponent shall provide a general project concept note project (e.g. name of proponent, project title, type, scale, and location of business/activities potential impacts and proposed impact mitigation measures). One agreed, the project proponent shall publish the information at public accessible media, e.g. printed media such as national/local newspaper or electronic media through television, website, social media, text message, and/or radio. Shall there be any comment, it should be delivered to environmental agency (via phone, letter, email, etc.) within 10 working days. When the environmental agency issues an environmental license, within 5 days after the issuance, disclose the documents and announces the issuance in a form of mass media and/or multimedia including website that can be accessed by the public effectively and efficiently. Under Law No. 14/2008 on Public Information, everyone has the right to obtain public information, attend public meetings, request copies of public information through an application, and/or disseminate public information. Environmental Core Principle. 1 Environmental and social management procedures and processes are designed to avoid, minimize and mitigate against adverse effects on natural habitats and physical cultural resources resulting from program. Key Elements Program System Gaps As relevant, the program to be supported:  Includes appropriate measures for early PERMEN No. 05/2012 on Type of Activities Requiring AMDAL No significant gaps identification and screening of potentially is based on a prescriptive screening process to determine whether important biodiversity and cultural projects are required to conduct an AMDAL and secure an resource areas. environmental license from the environmental agency. 33 Under PERMEN No. 05/2012, AMDAL is required for transmission (above 150 kV) and main substation (above 150 kV) but not for distribution. PERMEN No. 05/2012, however as stipulated in Article 3 requires AMDAL for any business/activities in or directly adjacent to protected areas The GOI has ratified international regulation on biodiversity No significant gaps.  Supports and promotes the conservation, through Law No. 05/1994: United Nation Convention on maintenance, and rehabilitation of natural Biodiversity. The Law requires the environmental assessment of habitats; avoids the significant conversion or degradation of critical natural habitats, proposed projects likely to have significant impacts on biological and if avoiding the significant conversion diversity with a view of avoiding or minimizing such effects. of natural habitats is not technically feasible, includes measures to mitigate or PERMEN No. 05/2012 Article 3 requires AMDAL for any offset impacts or program activities. activities in or directly adjacent to protected areas. Furthermore, Presidential Decree No. 32/1990 on Management of Protected Area stipulates that; (i) in protected areas, cultivation, which interferes with the environmental function of the protected area, is prohibited; and (ii) in nature reserves and areas of cultural heritage, cultivation, which alters the landscape, land use conditions, natural ecosystem, or environmental function of the nature reserves or cultural heritage, is prohibited. Extension of distribution lines are all in community areas, and shall it be located in protected areas or directly adjacent to protected, the environmental screening will exclude the proposal to be funded by the Program. Law No. 11/2010 on Physical Cultural Resources defines the No significant gaps  Takes into account potential adverse criteria, procedures and mechanism for cultural heritage effects on physical cultural property and, preservation. Culture heritage site is considered as protected areas as warranted, provides adequate measures as per the PERMEN No. 05/2012, therefore full environmental to avoid, minimize, or mitigate such effects. assessment (AMDAL) will be required. Distribution are all in community areas and Wilayahs have been carrying out similar programs over the years and have adequate capacity in managing the distribution construction work envisaged under the Program. This includes knowledge to avoid 34 adverse impact on the physical culture resource (e.g. mosques, burial sites, historical sites, etc.) Environmental Core Principle. 2 Environmental and social management procedures and processes are designed to protect public and worker safety against the potential risks associated with (a) construction and/or operations of facilities or other operational practices developed or promoted under the program; (b) exposure to toxic chemicals, hazardous wastes, and otherwise dangerous materials; and (c) reconstruction or rehabilitation of infrastructure located in areas prone to natural hazards. Key Elements Program System Gaps  Promotes community, individual, and Law No. 13/2003 on Manpower stipulates the obligation of all No significant gaps worker safety through the safe design, company to practice health and safety management and to construction, operation, and integrate the aspect into the company management system. For maintenance of physical infrastructure, the implementation of health and safety system, the Government or in carrying out activities that may be Regulation No. 50/2012 on Practice of Health and Safety dependent on such infrastructure with Management System has been issued. safety measures, inspections, or remedial works incorporated as Worker and communities health and safety is the first and needed. foremost in any PLN project implementation. To address the potential risks on workers’ health and safety, SMK3 ( Sistem Manajemen Kesehatan dan Keselamatan Kerja or occupational health and safety management system) was established by PLN respectively for transmission, main substation and distribution, which is well implemented. Performance of occupational health and safety and safeguard compliance are reported quarterly through the online system (i.e. SILM, Sistem Informasi Laporan Managemen-- or Information System for Management Report). 35  Promotes use of recognized good Law No. 32/2009 on Environmental Protection and There are gaps. There is a need practice in the production, Management, Article 3 mentions that EMPs shall aim to prevent of capacity building activities to management, storage, transport, and Indonesia’s territory from the environmental pollution and/or reiterate the important of damages, control the natural resources usage and establish the disposal of hazardous materials hazardous waste management as sustainable development. generated through program per the PLN Standard Operating construction or operations; and Government Regulation No. 101/2014 on Management of Toxic Procedure (SOP) promotes use of integrated pest and Hazardous Waste details the procedures for proper management practices to manage or management of hazardous waste, it adopts the principle of reduce pests or disease vectors; and “cradle to grave” starting from waste identifying, reducing, provides training for workers involved storing, collecting, transporting, utilizing, processing to final disposal of hazardous wastes. Used transformer oil is classified in the production, procurement, as hazardous waste. While the PLN has the license to temporary storage, transport, use, and disposal of store the hazardous waste, for final disposal/treatment, it has hazardous chemicals in accordance agreement with the third party who has the valid license to with international guidelines and manage the hazardous waste conventions. In addition to hazardous waste management, PERMEN No.16/2012 stipulated that the principle of prevention of pollution and prevention of damage to the environment needs to be considered through environmental assessment and applied in the context of environmental management. Site visit to the distribution warehouse found SOP for hazardous waste handling (i.e. used transformer oil) has not been implemented properly by the Wilayahs  Includes measures to avoid, minimize, The main natural hazards are floods, earthquake (and tsunami) No significant gaps or mitigate community, individual, and and landslides. The island of Sumatra is at the boundary between worker risks when program activities two tectonic plates. The ocean floor southwest of Sumatra is part of the Indian/Australian plate, while Sumatra and the other are located within areas prone to islands of Indonesia and Thailand are part of the Eurasian plate. natural hazards such as floods, hurricanes, earthquakes, or other Current health and safety regulations and environmental severe weather or climate events. management within PLN regulations requires contractors to have life policies. Distribution are all in community areas and Wilayahs have been carrying out similar programs over the years and have adequate capacity in managing the distribution construction work envisaged under the Program. For example, for construction of 36 switching substation, the Wilayahs has sufficient information to avoid areas prone to flood. 37 Social Core Principle. 1 Land acquisition and loss of access to natural resources are managed in a way that avoids or minimizes displacement, and affected people are assisted in improving, or at least restoring, their livelihoods and living standards. Key Elements Program System Gaps  The program avoids or minimizes the Program activities normally occur within the right of way of existing There are no significant gap adverse impacts of land acquisition. roads. When it occurs on private land, PLN’s practice is to minimize the siting of concrete poles on private lands and to avoid disturbance of non-land assets to the maximum extent possible or else to obtain APs’ concurrence well in advance during the planning stage for the use of private land for utility poles and removal of non-land assets  The program identifies and addresses The Program will not affect to physical displacement that leads to loss This element does not apply economic and social impacts caused by of income-generating opportunities or employment. to the Program. land acquisition, including those affecting people who may lack full legal rights to assets or resources they use or occupy.  The program provides compensation Land acquisition for switching substation (around 6x8 m2) is paid There is no significant gap. sufficient to purchase replacement assets prior the construction with the norm of willing buyer willing seller Direct purchase based on of equivalent value and to meet any business to business necessary transitional expenses, paid prior to taking of land.  The program provides supplemental The Program will not affect to physical displacement that leads to loss This element does not apply livelihood improvement or restoration of income-generating opportunities or employment to the Program measures if taking of land causes loss of income-generating opportunity.  The program restores or replaces public Program is not likely to affect public infrastructure or community There are no significant gap infrastructure and community services services, but, if these impacts occurred, the construction contractor adversely affected. would replace or repair the affected infrastructure 38 Social Core Principle. 2 Due consideration is given to cultural appropriateness of, and equitable access to, program benefits giving special attention to rights and interests of Indigenous Peoples and to the needs or concerns of vulnerable groups. Key Elements Program System Gaps  If Indigenous Peoples are potentially affected, The Program will not give negative impact to communities of There are no significant gaps. the program (i) consults with them, and (ii) Indigenous People. The Program should be open to all citizens ensures that they benefit from exploitation of as well ethnic group or indigenous people as beneficiaries of the Program. Prior consultation and information of the Program customary resources or indigenous knowledge. will be conducted before construction. Without mutual agreement, the Program cannot be implemented in the area.  The program gives attention to groups The Program would cover urban and rural in area already There are no significant gaps. vulnerable to hardship or disadvantage, electrified and it would also cover the lowest income including as relevant the poor, the disabled, households as beneficiaries. women and children, the elderly, or marginalized ethnic groups. 39 6 INPUTS TO THE PROGRAM’S ACTION PLAN 6.1 Main Inputs to the Program Action Plan 71. Based on the Program Environmental and Social System Assessment, gaps identify with the OP 9.00, data collected during site visits conducted to proposed Program and consultations held with PLN staff at HQ and Wilayahs, the following measures are proposed to improve the performance of the environmental and social management system of the Program. 72. The proposed environmental and social measures will become part of the Program Action Plan (PAP). These inputs to the PAP include key actions that should be undertaken to enhance Program’s environmental and social systems. Besides, the Proposed Action Plan includes recommendations from consultation activities, (i) discussion with PLN HQ and Wilayahs staff in charge of the environmental and social management and supervision of the Program, during the July and September 2015 mission and ii) public consultations with stakeholders conducted in 5 Wilayahs.. Table 6. Environmental and Social Measures for the Program Action Plan. Environmental and Social Actions Indicator Timing Responsible Screening PLN HQ Develop an initial screening form that the Statement letter issued by each Annualy Program will not i) be located in or Wilayah in the proposed annual adjacent to the protected area/forest or workplan to PLN HQ  as Legal forest area, ii) affect to physically Covenant displaced person/households or economic displacement and iii) impact to indigenous peoples Capacity Building - Training for the 7 Wilayahs to Training reports Before PLN HQ understand the screening form. loan - Training for hazardous waste and used effectiven transformer oil or spillage ess management (B3) SOP to 7 Wilayahs - Training for contractors in 7 Wilayahs for good construction management practice (including environmental health and safety) 73. Monitoring Plan: The PLN Environmental Unit at HQ will prepare bi-annual reports to the Bank to inform about progress in the implementation of the Program Action Plan and Program monitoring. 40 74. Digital database (SILM) at Wilayahs is able to i) monitor the progress of environmental performance (i.e. environmental permitting process (e.g. AMDAL, UKL/UPL), implementation of environmental management and monitoring plans, etc), ii) record complaint handling, health and safety issues. During the preparation of the program, PLN staffs both at HQ and Wilayahs have demonstrated how the SILM works to task team. 6.2 ESSA Consultation and Disclosure 75. A preliminary consultation on the proposed framework of ESSA took place in PLN HQ, Jakarta on September 7th and 9th, 2015; PLN HQ and Wilayahs staffs involved in design, construction, supervision, maintenance in distribution, as well as PLN Headquarter Environmental Unit consulted on the preliminary findings of the assessment, the strengths, risk and proposed action plan. Inputs from the consultation were included in the action plan. 76. Draft ESSA has been disclosed on October 16, 2015 at the Infoshop (English version) and PLN web sites (Indonesian version). 77. The first public consultation of draft ESSA took place in Bandar Lampung on Oct 19th, 2015, subsequently on Nov 3th and 5th, 2015 it was held in City of Banda Aceh and Tanjung Pandan (Belitung Island) respectively. Two more consultations were in Palembang (South Sumatra) on Dec 10 then Padang (West Sumatra) on Dec 11. Representatives of various local governments (provincial, district/city level) agencies, local universities, communities/ethnic groups and civil society participated the public consultation. In each consultation, Bank staff presented detailed information on the PforR process, the proposed Power Distribution Development Program, the key findings and recommendations of the ESSA. Inputs received during consultations were positive toward the Program implementation though some criticized poor service quality of the PLN (notably was the outage). Inputs/feedback from these consultation are included in final version of the ESSA 78. The final ESSA in both English and Indonesia will be disclosed on January 8, 2016 before negotiations begin. 41 7 ENVIRONMENTAL AND SOCIAL RISKS 7.1 Potential environmental and social risks 79. Although the Wilayahs have been carrying out similar programs over the years and are experienced and capable of managing the distribution construction work under the program, capacity of environmental and social management of the Wilayahs should be maintained and strengthened, as staffs moving in and out of PLN safeguard department are common. The capacity of the Wilayahs to monitor and enforce environmental health and safety measures in the contracts will need to be strengthened. Finally, the capacity of contractors to practice and implement health and safety measures needs to be improved as well. 80. Environment. The main identified environmental risks are: (i) risk of not applying the initial environmental and social screening resulting e.g. adverse impact on the protected/forest areas; (ii) risk of inadequate environmental supervision (e.g. Used transformer oil or oil spillage management, health and safety measures); (iii) risk of contractors poor environmental and social performance. The Program Action Plan includes actions to reduce these risks and ensure good environmental management, transparency and stakeholder communication. In general, the positive impacts that the program are expected to generate include benefits to the overall economy, improvements to the access to electricity for about 3 million people. While potential adverse environmental and social impacts from the construction activities are low and are manageable through the technical guideline of PLN Decrees on construction of distribution lines, there is risk however if enforcement of provisions in the contract is weak that results in complaint. Capacity in environmental and social management particularly in Wilayahs should be maintained through regular capacity building program. 81. The PLN HQ will evaluate carefully any proposed distribution activities crossing critical and natural habitats to ensure any work in those areas will be screened out. 82. Main pollution risks are related to management of used transformer oil and oil spillage that are classified as hazardous wastes as per the Government Regulation 101/2014 on Hazardous and Toxic Waste Management (B3 waste). Each PLN Wilayah has established Workshop of Electricity Maintenance that has the license from Ministry of Environment and Forestry to temporary store the B3 waste before it is handed over to licensed contractor for final disposal. Most of these risks and effects of the Program can be prevented and mitigated with proper environmental management actions, increasing environmental support and supervision, implementing the measures of proposed Action Plan and updating of the environmental manual. The SILM requires each Wilayah to provide information on B3 waste balance quarterly; this is to track volume of B3 waste that is temporary stored and has been transferred to the licensed third party for final disposal, recycled or destruction. 83. Social. The social risks associated to the Program are low; they stem from area of risk is unfairness in plants/crops acquisition compensation. This risk is addressed through the Program Action Plan. 7.2 Past project performance track-record on safeguards 42 84. The World Bank has partnered with PLN for energy project for several decades. PLN has been implementing many power sector projects funded by multilateral agencies for over 20 years; the projects include the existing WB funded Upper Cisokan Pumped Storage Hydro- Electrical Power, Indonesia Power Transmission Development Project (IPTD) and Second Power Transmission Development Project and many others. The PLN has experience and has acquired sufficient knowledge in managing environmental and social safeguards issues. And in regular basis, to enhance its staff capacity, both staffs from PLN HQ and Wilayahs are given opportunities to attend trainings (including training on environmental and resettlement safeguards) provided by the Education and Training Unit of PLN Corporate (Pusdiklat) twice per year. 7.3 ADB involvement in the Program 85. The Asian Development Bank (ADB) has prepared and negotiated a Results Based Loan (RBL) of US$600 million to PLN. The ADB RBL instrument is very similar to the PforR. The RBL will support PLN’s transmission and distribution expenditure program over the 2015 -2019 period in Sumatra region. Thus, both ADB and the Bank are proposing to provide parallel financing for the same distribution program in Sumatra over the same period. The only difference in program coverage is that of the US$600 million ADB Loan about US$180 million will be used to support prior results of the transmission component of the RUPTL; otherwise the Disbursement-Linked Indicators (DLIs), the implementation, monitoring and evaluation arrangements have been successfully harmonized through consultations and information sharing during the preparation process. ADB has also signaled to the Bank their intention to adopt the principle of third party verification of results that will be used for the PforR. 7.5 Evaluation of the Environmental and Social Risks 86. The Table 7 summarizes the environmental and social risks associated to the Program: Table 7. Global risk assessment of the Program. Risks Valuation Environment Social Environmental and social effects associated to the program activities Low Low National environmental and social context Low Low Strategy and sustainability of the program Low Low Local capacity and institutional complexity Low Low Reputational and political risk Low Low Global evaluation Low Low 43 8 INPUTS TO THE PROGRAM IMPLEMENTATION SUPPORT PLAN 87. The Table 8 indicates the environmental and social activities to be undertaken within the Program Implementation Support Plan. Table 8. Environmental and Social Support Plan for the implementation of the Program Activity Timing Field visits to selected Wilayah and project sites During Bank supervision missions: random sampling from i) PLN HQ for SILM reports; and ii) - To review of grievance redress resolution Wilayahs e.g. SILM reports on environmental and (Environmental and social issues) social management,, Call Center 123 Report - To review land transaction documentation (if any) including application of the screening process. - To review implementation progress of the environmental and social aspects of the action plan - To review the monitoring result of used transformer oil and spillage management Support PLN on remedial action to improve PLN During Bank supervision missions environmental and social system 44 Annex 1: Sumatra Island Power Transmission Maps (Existing and Future Development) A. Existing interconnection system of Sumatra Island power Sigli Banda Aceh Bireun Lhokseumawe P.Labu Jantho Idie Tualang Cut Langsa Meulaboh PLTU P.Brandan P.Susu PLTU/GU Belawan Labuhan P.Pasir Lamhotma Binjai PLTU Glugur Mabar Listrik KIM Sei.Rotan Perbau P.Geli Nagan Raya Namorambe Denai Titi Kuning ngan K.Namu INALUM T.Morawa K.Tanjung Brastagi Kisaran TNB T.Tinggi G.Para Malaysia Renun HEPP P.Siantar Aek Kanopan Sidikalang Porsea Tele Malaka D.Sanggul Asahan I R.Prapat HEPP Tarutung Simangkok K.Pinang PLTU Dumai L.Angin Sibolga Sipan Duri G.Tua Bagan Batu HEPP Martabe PLTG Pd. Sidempuan Balai Garuda Pungut Sakti Bangkinang Teluk Lembu Simpang 4 Kt.Panjang Payakumbuh HEPP Pd. Luar Maninjau HEPP Singkarak Batusangkar Pariaman HEPP T.Kuantan Lubuk Pd.Panjang Alung PIP Pauh Ombilin Limo Salak Kiliranjao S.Haru Indarung Solok Aur Duri Payo Selincah Bungus Muara Bulian PLTU Sumbar Pessel Muara Sewa Bungo Sungai Gelam Kambang Bangko Bayung Lincir Tanjung 1. IPP Palembang Timur Api-api 2. PLTG Ex Pulo Gadung 3. PLTMG Sewa Betung Tl.Kelapa Borang 3 Eksisting 70 kV 2 4 5 PLTG Talang Duku 1 Eksisting 150 kV PLTU Keramasan 7 6 1. Bukit Siguntang S.Belimbing Lubuk 2. Talang Ratu Eksisting 275 kV (Operasi 150 kV) Tes HEPP Linggau PLTU Keban Simpang 3 Mariana 3. Seduduk Putih Agung 4. Boom Baru Prabumulih Eksisting 275 kV Pekalongan PLTG 5. Sungai Juaro 6. Sungai Kedukan Bukit PLTG Jakabaring 7. Bungaran Rencana 150 kV Lahat Asam G.Megang Gardu Induk 150 kV Sukamerindu Musi HEPP PLTP Gumawang L.Balai Pembangkit Pagar Alam Baturaja Gardu Induk 70 kV Sp. Banyak Menggala Manna B.Umpu Sribawono Bukit Kemuning Kotabumi Besai HEPP Adijaya Metro Tegineneng B.Tegi Natar PT PLN (Persero) HEPP Sutami Ulubelu Suka Pagelaran Tlk. GEPP rame PENYALURAN DAN PUSAT PENGATUR BEBAN SUMATERA Betung Tarahan Sibalang New Tarahan Kalianda Sistem JAWA 45 B. Future interconnection system of Sumatra Island power. Ulee Krueng Kareng Raya Arun/ SISTEM INTERKONEKSI SUMATERA Banda Aceh TAHUN 2014-2023 C.Trueng Sigli Bireun Lhokseumawe Jantho Samalanga P.Labu Seulawah Geo Idie Takengon Tualang Cut Calang Blangkjere Langsa PLTU n P.Brandan P.Susu Peusangan 1-2 Wampu HEPP T.Pura HEPP PLTU/GU Binjai Belawan Meulaboh Mabar PLTU P.Geli P.Pasir Meulaboh Labuhan KIM Lamhotma Blang Pidie Namorambe Glugur P.Batu Sei.Rotan Denai Kuta Cane Titi Kuning K.Namu Perbaungan K.Tanjung T.Morawa T.Tinggi Kisaran TNB Brastagi Galang Renun Malaysia Tapak Tuan G.Para HEPP Aek Kanopan Sidikalang Pangu P.Siantar Sabulusalam ruran Porsea Tele Malaka D.Sanggul Asahan I R.Prapat Bagan Singkil HEPP Siapi-api PLTP P.Bukit Tarutung Simangkok Asahan III HEPP PLTP Sarulla& K.Pinang PLTU Sipaholon Dumai L.Angin KID Sibolga G.Tua Duri New Sipan HEPP Bagan Batu G.Sakti Perawang Siak Sri B.Pungut Indra Pura Pd. Sidempuan Kandis Garuda P.Pangarayan Pasir Putih Sakti Tenayan PLTP Bangkinang S.Merapi Panyabungan Teluk Lembu Simpang 4 Kt.Panjang P.Kerinci Payakumbuh HEPP Tembilahan Pd. Luar Maninjau Rengat HEPP Singkarak Batusangkar Pariaman HEPP T.Kuantan Lubuk Pd.Panjang PLTU Alung PIP Pauh Ombilin Riau K.Tungkal Limo Kemitraan GIS Kota Sabak Salak Kiliranjao S.Haru Indarung Solok PLTP Aur Duri Payo G.Talan Selincah Bungus g PLTP M.Laboh Muara Bulian New Aur Duri PLTU Sumbar Pessel Muara Bungo Sarolangun Kambang B.Lincir PLTU S.Penuh Bangko PLTU Sumbar-1 Merangin Muara Jambi Rupit 1. PLTG Apung HEPP S.Lilin T.Api-api 2. PLTG Ex Pulo Gadung 3. IPP Palembang Timur Borang Betung Tl.Kelapa Mukomuko 3 4 5 Sekayu GIS Kota I PLTP 2 Eksisting 70 kV Hulu Lais PLTU PLTG Kaji 1 6 Keramasan 7 S.Belimbing Eksisting 150 kV Lubuk PLTU K.Agung Bukit Asam Tes HEPP Linggau Mariana Simpang 3 Eksisting 275 kV (Operasi 150 kV) Argamakmur PLTU Prabumulih Kayu Pekalongan Banjarsari M.ENIM Agung Rencana 150 kV P.Baai T.Tinggi PLTG G.Megang Lahat Rencana 275 kV Sukamerindu Musi HEPP Gumawang PLTP Rencana 275 kV HVDC Pagar L.Balai Mesuji Alam Dipasena Rencana 500 kV PLTP Baturaja Sp.Banyak R.Dedap B.Umpu Rencana 500 kV HVDC Muara Marta pura P.Ratu Menggala Dua Sribawono Manna Bukit Kemuning Kotabumi Adijaya PLTP D.Ranau Besai HEPP Metro Tegineneng B.Tegi Gd.Tataan Natar Jati PLTP PT PLN (Persero) Liwa S.Sekincau PLTP HEPP Pagelaran Langkapura Agung Sutami UluBelu Suka Tlk. rame New PENYALURAN DAN PUSAT PENGATUR BEBAN SUMATERA Bengkunat K.Agung PLTP Wai Betung Tarahan Ratai Tlk. Ratai Kalianda Tarahan PLTP Rajabasa Sistem JAWA 46 Annex 2: Forest areas (National Park, Protected Forest, Production Forest). 47 Annex 3 Public Consultation that has already been done Draft ESSA of Power Distribution Development Program for Result Who & how many How these issues were Key issues raised during the No When Where people addressed in the revised consultation participated documents 1 19 Wilayah 45 participants: 1. Demand for power is higher 1. Wilayah Lampung will have October Lampung, • PLN Headquarter than available. new PLTU Sebalang to fill 2015 in • PLN Wilayah the shortage of electricity Lampung including Area and 2. Quality of power supply is supply in Lampung. Rayon low with unstable voltage 2. This problem has been • Provincial accommodated in Result agencies 3. Program should be able to Area 2, 3 and 4. • Local university support provincial 3. Principally PLN support  NGOs government in tourism economic development plan development, industrial of district and provincial estate and port government. It has been development at west coast discussed in coordination of Lampung meeting with all 4. PLN is still slow in districts/cities led by responding complaints Governor of Lampung Province. 4. PLN always try to respond any complaints ASAP. But PLN needs to get clear location and the problem to follow up complaints received by Call Center 123, Area and Rayon. 5. Trees to trees. How does 5. Program will not cut forest PLN replace the forest trees and will not affect trees? forest area 6. How does PLN 6. For the need of distribution communicate if the activity poles PLN will do direct will use private land? communication with the community to reach consensus or mutual agreement with land owners whether they agree PLN to install the poles on their land. For switching substation, around 48m2 is needed and PLN will purchase on business to business basis. 7. Real estate is easier to get 7. PLN has same treatment or electricity access than service to customers individual 8. Wilayah will have new 8. The remaining supply is just power plant that can 23 MW. How does PLN supply the shortage in near develop new program future 48 Who & how many How these issues were Key issues raised during the No When Where people addressed in the revised consultation participated documents 9. Provincial government 9. PLN will coordinate with support Program as well provincial government to public determine priority locations. 10. Why IP seems to be Refer to SOP, electricity is avoided in the Program? What public goods that everyone has will PLN respond if IP or the same right in accessing it. ethnic group wants to have PLN does not favor or avoid any access to electricity? group. PLN always provides information and consultation with candidates of beneficiaries prior construction. PLN needs agreement with the community and to understand the aspiration of the community if the Program will be implemented in the area. Without mutual agreement PLN cannot continue the Program and will move to another location. 2 3 Nov Wilayah 51 participants 1. How PLN valuate 1. Wilayah uses local market 2015 Aceh, in • PLN Headquarter productive or big trees? while to replace greening Banda • PLN Wilayah 2. Some poles looks lack of trees (within the RoW) Aceh including Area and maintenance for instance owned by district/city, PLN Rayon overload, tilted, number of will replant with similar • Provincial outages trees. agencies 3. Some poles have not been 2. Wilayah will pay attention on • Local university moved by PLN because of that issue. Overload burden  NGOs road widening program of the transformer would be  Journalist 4. Is possible for the Bank t part of the Program for developing potential activities. Maintenance work new energy geothermal. is associated with the system Aceh has good resources itself. If the large system in for geothermal North Sumatra has disruption then the smaller systems in the NAD will be disrupted as well. In Result Area 2&3 will improve outage management and additional distribution transformer unit 3. Any project actually should allocate relocating budget for affected utilities including distribution poles. Relocation of pole needs to be planned a year ahead. 4. The Bank has experiences work together with PLN, 49 Who & how many How these issues were Key issues raised during the No When Where people addressed in the revised consultation participated documents Pertamina on geothermal. 5. PLN also faces problem to 5. PLN and district, city get permit from government as are mandated district/city government. It to provide the basic need services to all citizens. takes time and could be 3-6 Provincial, district/city months government should support accelerating infrastructure development. PLN HQ and the Bank agree to finance distribution activities with low impact and fast implementation. 6. Selection of location for 6. Agree, PLN is maintaining Program should have good coordination with Provincial coordination with Province and district/city government. particularly relate to village electricity 7. How is distribution of 7. Implementation of Program Program budget to will be as normal PLN Wilayah? Wilayah activity. Budgetary system and implementation 8. How does PLN evaluate of Program follow PLN Program? procedure. 9. How does the Bank provide 8. During supervision of feedback to PLN? implementation of Program the Bank will review randomly SILM (Information System for Environmental Management) either in PLN HQ or Wilayah and grievance handling complaints through report of Call Centre 123 in Wilayah Office. 10. Who are eligible to get Everybody has right to get access to electricity in the access to electricity. Program? Everybody can register to local office of PLN. 11. PLN should pay attention Program will only finance the impact of high voltage distribution program, SUTET installation (SUTET) is not cover under program because it is not part of power distribution 12. Distribution poles should PLN agrees that Program match with detail spatial should also improve the plan and PLN should services through capacity building of PLN both in improve quality of the Wilayah and HQ services too besides quantity of services. 50 Who & how many How these issues were Key issues raised during the No When Where people addressed in the revised consultation participated documents 13. Although impact of According to Indonesian EA environment is minor why regulation, environmental PLN does not need prepare impact of distribution activities env document? is low therefore there is no requirement for preparing env document. Except for hazardous waste and used transformer oil or spillage management (B3) SOP to 7 Wilayahs. Refer to PLN Regulation this waste must be managed by licensed third party and PLN must has license too for temporary storing the B3 waste. So far PLN has fulfilled the requirements (table 6 of ESSA) 3 5 Nov Wilayah 35 participants 1. In principal community of 1. PLN will improve the 2015 Bangka  PLN Headquarter Belitung Island supports performance as much as Belitung, in • PLN Wilayah the Program and support possible through the Result Belitung including Area Area 1, 2 and 3 of Program. to environmental and Island and Rayon PLTU Suge is the new one social requirements what and it would improve • Relevant agencies from PLN required. Community electricity services in Belitung and needs access to electricity Belitung Island. Belitung Timur and better quality on Districts services. PLN should be  NGOs able to minimize number  Local leaders as of power outages representatives occurred in the last two of community  Local radio months.  Journalist from local newspapers  Contractor PLN 2. Instead of annual cutting This is very good input and on trees branches PLN PLN will consider Tanjung would be better replace tree. the trees with a slow- growing tree, but a good for greening trees such as pohon tanjung. 3. Communities do not Good input and acknowledged objection if PLN uses their by PLN and participants. PLN land for poles and cut the did consultation and 51 Who & how many How these issues were Key issues raised during the No When Where people addressed in the revised consultation participated documents trees but PLN should information in each village control more its organized by relevant village contractor works. head during planning. During Installations of new poles implementation the role of are often not proceeded contractor is to do without proper consultation with local information by communities before contractors to construction. Public can report landowners. their complaints through Call Center 123 however PLN agrees to pay attention on this issue with contractor. 4. Why the Program put Program will be implemented forest land or within four years and should conservation land as be implemented in area and negative list for do not have environment and distribution activities? social risk. If Program is to Why PLN HQ cannot solve affect forest and that must this issue with Min of follow environmental Forest in central level? requirements and permits from Ministry of Env and Forest, the Program will not achieve its objective 5. Ethnic group who are living PLN has same service to far from the city has the everybody who wants to get same need to get access to access to electricity. Wilayah electricity as people who and contractor will do are living in the city. We consultation before are support the Program construction to reach agreement. 6. Additional power supply in Construction of PLTU Suge has Belitung has been been completed and is being in requested by investors performance test. From such as hotels in the last January 2016, Belitung will two years have capacity 48,8 MW while the peak load is 35 MW. 4 Dec 10, Wilayah 30 participants 1. Support the Program but 1. PLN will always follow 2015 SumSel in  PLN Headquarter PLN should provide Director Decree No. 474 and Palembang  PLN Wilayah information about 606 of 2010 concerning on South Sulawesi distribution development Construction Standard for including Area, plan to public before any low and medium voltage, in Rayon and UPK construction which the PLN should  Representatives 2. PLN must be transparent provide information and do of agencies from on installation cost to consultation prior any provincial and public construction city level 3. YLKI will send to the 2. New location for access to 52 Who & how many How these issues were Key issues raised during the No When Where people addressed in the revised consultation participated documents  NGOs Bank the proposed electricity and the cost is locations that need normally publish in local access to electricity newspaper 3. PLN is welcome to YLKI and public to receive any proposed location which needs to get access to electricity 4. Law No. 23 of 2014 should 4. Good input and PLN be added as reference. already have good District no longer has the coordination with provincial level. Final ESSA authority to plan for village will be revised accordingly. electricity and it becomes the authority of the provincial government 5. In the monitoring of 5. Good input. PLN and the Program, it should Bank will do evaluation in consider gender and the mid term and at the end of the Program and children as beneficiaries will consider this input. 6. Although the Program has 6. Agree and it is accordance minor impact on with the rules of PLN environment and social, PLN has to maintain information communication with the community/ public prior construction 7. PLN should have proper 7. Agree, it is accordance with management and follow the rules of PLN the regulations on B3 waste for used transformers. 8. PLN should ensure that the 8. Agree and PLN has good greening in areas where coordination with trees have cut for the district/city government Program. PLN is responsible to replant the trees as soon as possible. 5 Dec 11, Wilayah 33 participants 1. PLN also should reduce 1. This is part of Result Area 2015 SumBar in  PLN Headquarter outage so business 1, 2 and 3. Padang  PLN Wilayah activities are not West Sumatra disturbed. including Area, 2. In Bukittinggi, PLN has a 2. Underground cable is very and Rayon problem to maintain the expensive, cost around 4  Representative of cutting trees because of times than the normal agencies from Adipura and old trees. cable. However, Wilayah 53 Who & how many How these issues were Key issues raised during the No When Where people addressed in the revised consultation participated documents provincial level Underground cable is the will discuss with PLN  NGOs best way to be trial in the Headquarter whether it is  Nagari Program. Is it possible for possible for piloting in Indigenous PLN to do a pilot for Bukittinggi. Institute underground cable? (Lembaga Kekerabatan Nagari)  Academica (local universities) 3. Call center 123 always 3. Wilayah will more pay busy and handling in the attention on this case. grounds not always fast. 4. PLN should consider 4. Agree natural disaster and technical problem in the generator 5. Everyone as well as IP or 5. Agree. PLN has same ethnic groups needs services and treatment to access to electricity. any customers. Mutual However, prior agreement has to be built consultation and between PLN and the information before community before any construction must be construction started. conducted by PLN with the community. Mutual agreement on the Program is the basic reference for PLN before construction 6. PLN also faced problem 6. Good input to move distribution poles because of road widening. It is very often projects (non-PLN) did not allocate budget for moving the poles. 7. Whenever investors who 7. PLN is welcome to any would like to invest investor and please inform visited government the investor to send letter office, the main question to PLN for the business from the investor plan and its schedule so whether capacity of the PLN can provide electricity electricity enough to services. cover new business. 8. Whenever there is price 8. Agree and so far PLN per KWH changes, PLN always publish it in local should provide proper media. Changes in information to public so electricity rates is national that people know the wide and it must be put in amount of bills to be paid national and local media 54 Who & how many How these issues were Key issues raised during the No When Where people addressed in the revised consultation participated documents will be higher than the (newspaper and television) previous bill. 9. Outages should consider 9. Agree, it covers in result work/business time area 1, 2 and 3 10. Routine cutting of trees 10. Agree need to pay attention to the aesthetics of the city. 11. Everyone dreams to have 11. Agree access to electricity and ready to support Program in West Sumatra 55