INTEGRATED SAFEGUARDS DATA SHEET APPRAISAL STAGE Report No.: ISDSA7798 Public Disclosure Copy Date ISDS Prepared/Updated: 17-Apr-2014 Date ISDS Approved/Disclosed: 18-Apr-2014 I. BASIC INFORMATION 1. Basic Project Data Country: Guinea Project ID: P146696 Project Name: Power Sector Recovery Project (P146696) Task Team Moez Cherif Leader: Estimated 17-Apr-2014 Estimated 16-Jun-2014 Appraisal Date: Board Date: Managing Unit: AFTG2 Lending Investment Project Financing Instrument: Sector(s): Thermal Power Generation (100%) Theme(s): Infrastructure services for private sector development (100%) Is this project processed under OP 8.50 (Emergency Recovery) or OP No 8.00 (Rapid Response to Crises and Emergencies)? Financing (In USD Million) Total Project Cost: 50.00 Total Bank Financing: 50.00 Public Disclosure Copy Financing Gap: 0.00 Financing Source Amount BORROWER/RECIPIENT 0.00 International Development Association (IDA) 50.00 Total 50.00 Environmental B - Partial Assessment Category: Is this a No Repeater project? 2. Project Development Objective(s) The Project Development Objective (PDO) is to improve the technical and commercial performance of the national power utility. 3. Project Description The IDA project will support electricity sector institutional and managerial reforms aimed at catalyzing the development of sector investment and access in line with Government and SE4All Page 1 of 8 objectives; and short term improvement in the quality of power supply, through physical investments and technical assistance. The project is structured under three components: Public Disclosure Copy Component 1: Financing of a Management Services Contract to support EDG performance improvement (US$ 14 million). This component will finance a Management Services Contract (MSC) between MEH and a private firm (“the Operator”) with sufficient technical and fiduciary capacity to provide management, operation and capacity building services for EDG over 3-5 years. Specifically, the operator will be selected through a rigorous and competitive process on the basis of technical capacity and a proposed business plan. This component will fund the fees to be paid to the Operator, including fees for mobilizing a full-time team of senior managers to run EDG, experts in specialized areas of utility management for specific needs such as training and capacity building for utility personnel, and communications to target EDG customers. The MSC will also include a bonus component to be paid only if EDG exceeds certain performance outputs or targets. The Operator will be given fully delegated authority to run EDG as a vertically integrated electricity utility, including carrying out the reorganization or restructuring in line with recommendations made in the Power Sector Diagnostic and Recovery Plan, and will be the solely authorized agent to administer its assets and control all business functions for the duration of the contract. The main deliverable of the MSC will be the implementation of a business plan proposed by – and agreed with – the Operator that will reflect the objectives and investment activities of the Power Sector Diagnostic and Recovery Plan. As such, the MSC will be signed between MEH and the Operator, and designed to strengthen performance of EDG through improvements in staff skills and morale, data management, and grid infrastructure. Component 2: Selected investments in the Conakry power network (US$ 33.7 million). This component will support investments that will enable EDG to improve the reliability of electricity supply in the capital city of Conakry where 80 percent of its clients are located. In response to frequent rolling blackouts, this component further adds to the ESEIP financed rehabilitation and upgrading of the network in the district of Kaloum and AfDB/IsDB financed rehabilitation works in Public Disclosure Copy Ratoma and Matoto. Proposed investments under this component are extracted from the Government’s priority investment plan but the exact scope of each activity will be finalized once the Operator is in place. Sub-component 2.A – Improving distribution network conditions in Conakry. This sub-component will support the priority investment program of the GoG including: i. Rehabilitating and upgrading the dilapidated distribution infrastructure in the Dixinn district of greater Conakry. ii. Provision of operation and maintenance equipment and tools. iii. Supply and installation of the protection system of hydropower plants against voltage surges to ensure sustainable and safe supply of power. iv. Equipment to compensate for reactive power and improve power factor in the system. v. Contingencies and unallocated. Sub-component 2.B – Improvement of Commercial performance of EDG. Investments under this sub-component will include: i. Implementation of a census of all EDG customers and revision the client database accordingly. Each client will be assigned a specific client code to facilitate account management. Page 2 of 8 ii. Upgrading the integrated IT management system of EDG. iii. Rehabilitation of household connections in Kaloum, Ratoma and Matoto districts. iv. Standardization of household connections in the areas of Kaloum, Ratoma and Matoto, Public Disclosure Copy including informal and illegal connections. v. Contingency and unallocated. Component 3: Technical Assistance to MEH and Project Implementation Support (US$ 2.3 million). This component envisages the following three sub-components. Sub-component 3.A: Technical Assistance to the MEH. This sub-component will support the MEH’s supervision of the Operator, and provide TA to MEH to carry out other sector policy and oversight activities. Activities will include: i. Technical assistance to implement a financial restructuring of EDG. ii. An independent technical auditor to directly track Operator’s deliverables and certify whether agreed results have been achieved. iii. Technical assistance to develop the GoG’s anti-fraud policy and the legal instrument to enforce it. Sub-component 3.B: Project Implementation Support. This component will cover the costs related to the utilization of experts and equipment for the efficient operation of the Project Implementation Unit (PIU) within MEH, in the following areas: (i) procurement of goods and consultant services, (ii) financial and disbursement management, (iii) safeguards supervision, and (iv) monitoring and evaluation. 4. Project location and salient physical characteristics relevant to the safeguard analysis (if known) Project activities will be undertaken mainly in Greater Conakry area and to a lesser extent in the center of the country, where EDG’s two main power networks are located. Public Disclosure Copy 5. Environmental and Social Safeguards Specialists Hocine Chalal (AFTN1) Paivi Koskinen-Lewis (AFTCS) 6. Safeguard Policies Triggered? Explanation (Optional) Environmental Assessment OP/ Yes An environmental audit of EDG has been BP 4.01 finalized and has been disclosed before appraisal. This will feed into the MC environmental requirements, applicable to the client (MEH and EDG) as well as to the contractors, which will have to be in line with Bank safeguard policies. The audit includes an assessment of potential impacts and proposed mitigation measures. An ESMP will be prepared, consulted upon and disclosed during project implementation. Natural Habitats OP/BP 4.04 No To the extent that the investment component of the project pertains to existing connections close Page 3 of 8 to consumer premises, the Natural Habitats policy is not triggered. Forests OP/BP 4.36 No To the extent that the investment component of Public Disclosure Copy the project pertains to existing connections close to consumer premises, the Forest policy is not triggered. Pest Management OP 4.09 No Not applicable Physical Cultural Resources OP/ No The project does not involve or affect Physical BP 4.11 Cultural Resources. Indigenous Peoples OP/BP 4.10 No There are no Indigenous Peoples in the project area. Involuntary Resettlement OP/BP Yes The policy is triggered because of the activities in 4.12 component 2; the rehabilitation and upgrading of distribution facilities. Since the exact locations of these works are not known, a Resettlement Policy Framework (RPF) has been prepared and consulted upon and has been publicly disclosed in-country and at InfoShop before appraisal. The RPF contains the guidelines for the preparation, if and when necessary, of Resettlement Action Plans in case of land acquisition and losses of assets, or access to resources. The RPF will also feed into the MC’s social requirements, applicable to the client (MEH and EDG) as well as to the Operator contract clauses, which will have to be in line with Bank safeguard policies. A Public Disclosure Copy RAP will be prepared, consulted upon and disclosed -- as and when necessary -- during project implementation. Safety of Dams OP/BP 4.37 No Not applicable Projects on International No Not applicable Waterways OP/BP 7.50 Projects in Disputed Areas OP/BP No Not applicable 7.60 II. Key Safeguard Policy Issues and Their Management A. Summary of Key Safeguard Issues 1. Describe any safeguard issues and impacts associated with the proposed project. Identify and describe any potential large scale, significant and/or irreversible impacts: The Project is expected, in general, to positively impact the beneficiary communities by improving the quality and reliability of electricity services that are provided to them. The net social and environmental effect of the project is expected to be highly positive as greater access to reliable energy will improve living conditions for the beneficiaries. This includes districts in Conakry, the Page 4 of 8 capital. Households, which currently depend on illegal connections for electricity, will not be left without electricity but will be connected by legal connections through extension of the network; and businesses and institutional users (local government, schools, places of worship, etc.) would Public Disclosure Copy also benefit from reliable service provision. The potential negative environmental and social impacts of the proposed project activities are expected to be small-scale and site-specific. The safeguard category of the Project is determined to be B, since there are no significant and/or irreversible adverse environmental and social issues expected from the upgrade and extension of distribution facilities as envisaged under component 2 of the Project. These facilities largely include the existing distribution network of Conakry. Impacts are anticipated as a result of the activities to reinforce, rehabilitate, and expand the primary and secondary MV distribution grid and selected components of the LV distribution grid. The World Bank policies for Environmental Assessment (OP/BP 4.01) and Involuntary Resettlement (OP/BP 4.12) are triggered. An environmental audit of EDG and a Resettlement Policy Framework (RPF) are being prepared and will be disclosed before appraisal. These will feed into the MC environmental and social requirements, applicable to the client (MEH and EDG) as well as to the Operator contracts, which will have to be in line with Bank safeguard policies. 2. Describe any potential indirect and/or long term impacts due to anticipated future activities in the project area: There has been no significant indirect, long term, irreversible or cumulative impacts identified in relation to any of the project components mentioned above. 3. Describe any project alternatives (if relevant) considered to help avoid or minimize adverse impacts. To the extent the investment component consists mostly of rehabilitation of existing assets, this is not relevant. 4. Describe measures taken by the borrower to address safeguard policy issues. Provide an assessment of borrower capacity to plan and implement the measures described. Public Disclosure Copy The RPF is being prepared, since the exact locations for rehabilitation of the infrastructure have not yet been identified while the district has been identified. The RPF contains: (i) an assessment of the country regulatory and institutional framework for land acquisition and compensation; (ii) likely categories of affected assets and parties, as well as the scope of impacts; (iii) a gap analysis and a compensation framework consistent with OP 4.12 and the national legislation; (iv) measures to assist vulnerable groups; (v) a consultation framework to enable the participation of affected populations in the preparation of specific resettlement plans; (vi) an institutional framework to implement the resettlement policy framework; (vii) a grievance redress mechanism; and (viii) a monitoring and evaluation framework and budget. It will also feed into the Operator’s social obligations. The RPF has been consulted upon and will be disclosed both in-country and in the World Bank InfoShop prior to appraisal. Under Component 2, potential negative impacts are possible from the rehabilitation of the dilapidated distribution facilities (sub-component 2.A). These facilities largely include the existing distribution network of Conakry. Impacts are anticipated as a result of the activities to reinforce, rehabilitate, and expand the primary and secondary MV distribution grid and selected components of the LV distribution grid. This work is similar to the ongoing Bank-financed project ESEIP in the district of Kaloum in Conakry. OP 4.12 is triggered to cover any potential land acquisition and/ or subsequent losses of assets or restrictions of access to resources. In case compensation is required, the costs will be covered by the Borrower. The RPF contains guidance for preparing Page 5 of 8 specific Resettlement Action Plans (RAPs) for issues related to land acquisition and loss of economic activities and assets to minimize negative impacts on Project Affected Persons. Any RAPs will need to be cleared by relevant authorities in Guinea and by the World Bank and Public Disclosure Copy subsequently disclosed in-country and at the World Bank’s InfoShop before any civil works can begin. The Operator will be responsible for the implementation and monitoring of the RPF and/or subsequent RAPs to ensure compliance with national and Bank policies and procedures. Training in safeguards will be provided by Bank safeguards staff to facilitate these activities. Regular monitoring reports (two per year) on the implementation of environmental and social safeguards provisions will be provided to the Bank for approval. These reports will be verified during project supervision missions, which will include environmental and social safeguard experts. The environmental audit being carried out will identify the potential environmental impacts of the current practices of EDG in the context of its distribution and connection works and will spell out the requirements to be applicable to the Operator in terms of applicable environmental and social systems that will have to be implemented. 5. Identify the key stakeholders and describe the mechanisms for consultation and disclosure on safeguard policies, with an emphasis on potentially affected people. Key stakeholders include the Ministry of Energy and Hydraulics, the national power utility EDG and the potentially affected population. During the preparation of the RPF, consultations have been held with these key actors in order to discuss the project contents as well as to understand any concerns the affected people may have and to ensure any concerns are taken into account in the project design. The report will be validated in a national level workshop. The RPF has been disclosed publicly in-country and at the InfoShop prior to appraisal. B. Disclosure Requirements Public Disclosure Copy Environmental Assessment/Audit/Management Plan/Other Date of receipt by the Bank 10-Apr-2014 Date of submission to InfoShop 16-Apr-2014 For category A projects, date of distributing the Executive Summary of the EA to the Executive Directors "In country" Disclosure Guinea 16-Apr-2014 Comments: Disclosed in-country by the national utility on behalf of the client in line with Bank policies. Resettlement Action Plan/Framework/Policy Process Date of receipt by the Bank 10-Apr-2014 Date of submission to InfoShop 16-Apr-2014 "In country" Disclosure Guinea 16-Apr-2014 Comments: Disclosed in-country by the national utility on behalf of the client in line with Bank policies. Page 6 of 8 If the project triggers the Pest Management and/or Physical Cultural Resources policies, the respective issues are to be addressed and disclosed as part of the Environmental Assessment/ Audit/or EMP. Public Disclosure Copy If in-country disclosure of any of the above documents is not expected, please explain why: C. Compliance Monitoring Indicators at the Corporate Level OP/BP/GP 4.01 - Environment Assessment Does the project require a stand-alone EA (including EMP) Yes [ ] No [ ] NA [ ] report? If yes, then did the Regional Environment Unit or Sector Yes [ ] No [ ] NA [ ] Manager (SM) review and approve the EA report? Are the cost and the accountabilities for the EMP incorporated Yes [ ] No [ ] NA [ ] in the credit/loan? OP/BP 4.12 - Involuntary Resettlement Has a resettlement plan/abbreviated plan/policy framework/ Yes [ ] No [ ] NA [ ] process framework (as appropriate) been prepared? If yes, then did the Regional unit responsible for safeguards or Yes [ ] No [ ] NA [ ] Sector Manager review the plan? The World Bank Policy on Disclosure of Information Have relevant safeguard policies documents been sent to the Yes [ ] No [ ] NA [ ] World Bank's Infoshop? Have relevant documents been disclosed in-country in a public Yes [ ] No [ ] NA [ ] place in a form and language that are understandable and accessible to project-affected groups and local NGOs? All Safeguard Policies Public Disclosure Copy Have satisfactory calendar, budget and clear institutional Yes [ ] No [ ] NA [ ] responsibilities been prepared for the implementation of measures related to safeguard policies? Have costs related to safeguard policy measures been included Yes [ ] No [ ] NA [ ] in the project cost? Does the Monitoring and Evaluation system of the project Yes [ ] No [ ] NA [ ] include the monitoring of safeguard impacts and measures related to safeguard policies? Have satisfactory implementation arrangements been agreed Yes [ ] No [ ] NA [ ] with the borrower and the same been adequately reflected in the project legal documents? III. APPROVALS Task Team Leader: Name: Moez Cherif Approved By Regional Safeguards Name: Alexandra C. Bezeredi (RSA) Date: 17-Apr-2014 Advisor: Page 7 of 8 Sector Manager: Name: Meike van Ginneken (SM) Date: 18-Apr-2014 Public Disclosure Copy Public Disclosure Copy Page 8 of 8