INTEGRATED SAFEGUARDS DATA SHEET APPRAISAL STAGE Report No.: ISDSA723 Public Disclosure Copy Date ISDS Prepared/Updated: 23-Mar-2012 I. BASIC INFORMATION 1. Basic Project Data Country: Indonesia Project ID: P123994 Project Name: Indonesia Second Power Transmission Development Project (P123994) Task Team Leader: Anh Nguyet Pham Estimated Appraisal Date: 22-Feb-2012 Estimated Board Date: 08-May-2012 Managing Unit: EASIS Lending Instrument: Specific Investment Loan Sector: Transmission and Distribution of Electricity (90%), Energy efficiency in power sector (10%) Theme: Infrastructure services for private sector development (90%), Climate change (10%) Financing (In USD Million) Financing Source Amount Borrower 21.43 International Bank for Reconstruction and Development 325.00 AUSTRALIA Australian Agency for International Development 0.00 Total 346.43 Environmental Category: B - Partial Assessment Is this a Repeater project? Yes 2. Project Objectives The development objective of the proposed project is to assist the Borrower to meet growing electricity demand and increase access to electricity in Java-Bali, East and West Indonesia through strengthening and expanding the capacity of the power transmission networks in these areas in a sustainable manner. Public Disclosure Copy 3. Project Description The proposed project consists of three components as described below. The preliminary cost estimate is about US$346.43 million in which $325 million is to be provided by IBRD and the rest by PLN. Component 1: Extension, Rehabilitation and Construction of 150 kV Substations in the Java-Bali System. Under this component, selected existing 150/20 kV substations in Java-Bali will be expanded by adding one or more new transformers and associated equipment at each substation; replacing one or two existing transformers with new transformers and associated equipment with higher capacity; and constructing selected new 150/20kV substations. These substations will be located across the islands of Java and Bali. Component 2: Extension, Rehabilitation and Construction of 150 kV and 70 kV Substations in East Indonesia. Under this component, selected 150/20 kV and 70/20 kV substations in East Indonesia will be expanded by adding one or more new transformers and associated equipment at each substation or replacing one or two existing transformers with new transformers and associated equipment with higher capacity. In addition, selected new 150/20kV substations will be constructed. These substations will be located in Kalimantan (except West Kalimantan province) and Sulawesi. Component 3: Extension, Rehabilitation and Construction of 150 kV Substations in West Indonesia. Under this component, selected existing 150/20kV substations in West Indonesia will be expanded by adding one or more new transformers and associated equipment at each substation or replacing one or two existing transformers with new transformers and associated equipment with higher capacity. In addition, selected new 150/20kV substations will be constructed. These substations will be located in Sumatra and West Kalimantan province. The project will be implemented in phases. The first phase will consist of sub-projects (Group 1) which have been fully appraised and are ready for implementation upon approval of the project by the World Bank's Board of Executive Directors. The second phase will consist of sub-projects (Group 2) which will be brought forward by PLN when their preparation is complete. Each sub-project of Group 2 will be appraised by the Bank’s team against of a set of eligibility criteria and will be accepted for financing only after the appraisal confirms that it meets the criteria. Sub-projects will be financed on a first-come, first-appraised basis until all IBRD funds allocated to the project is fully committed. 4. Project location and salient physical characteristics relevant to the safeguard analysis (if known) The subprojects are located in various urban, peri- urban and rural areas in Java, Bali, Sulawesi, Kalimantan, and Sumatra islands. For expansion and rehabilitation subprojects, the key activity is to install new transformers and associated equipment or replace existing Page 1 of 6 transformers and associated equipment with new ones with higher capacity in the existing 150/20 kV and 70/20kV substations. Rehabilitation does not require land acquisition and will be implemented within the premises of these substations. While most of expansion subprojects do not require land acquisition, some subprojects will require limited additional pieces of land, which is normally adjacent to the existing substations. For new substations, the key activity is to construct new 150/20kV substations which have one or two transformers and associated equipment at 150 kV and 20 kV, a control room and ancillary equipment. Typically a new substation requires a short 150 kV transmission line (up to 5 km long) to connect the substation to the existing network and in few cases, upgrading of an existing road. A new substation requires an enclosed, leveled Public Disclosure Copy site free of any vegetation or human habitation (except for substation operators), typically measuring about 150m x 150 m. For substations that involve construction of connecting 150 kV transmission lines or upgrading of existing access road, these structures require additional permanent and temporary land acquisition. New subproject sites can be, and normally are, selected flexibly within a certain area to minimize the scale of such structures and avoid or minimize impacts on environment or land acquisition. Site visits and screening undertaken by the task team has determined that Indigenous Peoples as defined by OP 4.10 are not present in, nor have collective attachment to the project area under the proposed subprojects of Group 1. Similarly, no natural and or critical habitats will be impacted by the subprojects of Group 1. However, as PLN can update, replace or propose new subprojects in the second group, these subprojects may be located in areas that indigenous people communities are present, or have impacts on natural habitats. Each subproject will be evaluated against the project safeguard checklist in the ESMF. No subproject will be approved for funding, if any of the following could occur: • significant degradation or conversion of natural habitats and/or forests in protected areas, proposed protected areas or areas that are considered of special ecological significance. • temporary or permanent relocation or any other type of impact on physical cultural resources known to be of local, regional or national significance based on national or Provincial lists, proposed national or Provincial lists and/or identified during public consultation with local affected groups. • any physical cultural resources considered especially important or sensitive particularly to local groups (e.g. gravesites) are located on the site. • temporary or permanent reduction or degradation to the ecosystem function of, or resources within, a production, conservation or multiple use forest. 5. Environmental and Social Safeguards Specialists Ninin K. Dewi (EASIS) Warren Waters (AFTTR) Andrew Daniel Sembel (EASIS) Penelope Ruth Ferguson (EASIS) 6. Safeguard Policies Triggered? Explanation (Optional) Environmental Assessment OP/BP 4.01 Yes The following impacts are identified during construction for rehabilitation and expansion of 150/20 kV and 70/20 kV substations: (i) increased level of dust and noise from the use and movement of machinery; (ii) non toxic solid waste during construction; (iii) oil spill or leakage from machinery or transformers; (iv) prohibition Public Disclosure Copy of PCB and (v) worker health and safety from existing EMF. Impacts during operation include (i) oil leaks from transformers; (ii) fire and emergency preparedness; (iii) solid wastes and (iv) worker health and safety. Other issues for equipment upgrades and additions that have been identified include managing potential legacy soil contamination and storing and disposing of old transformers. For new substations, in addition to the above impacts, other issues include the management of vegetation clearance and sediment and erosion control. Land acquisition processes, including public consultation and satisfactory compensation for the population residing in the project area is the main social issue under the project. Since land acquisition is limited, impacts on the individual project affected people (PAP) is normally modest and limited in the acquisition of small pieces of land or cutting down of a few trees. There will be no worker camps. The social nuisances from construction (noise, dust, traffic etc), will be managed under the EMP. A due diligence audit was conducted during preparation of the Indonesia Power Transmission Development Project (IPTD) aiming to identify any potential environmental and social liabilities of the existing substations where the Bank will finance expansion or upgrading subprojects, any physically connected projects, and other potential corporate reputation risks, such as the potential climate changes impacts of the project. The due diligence audit confirmed that PLN has acceptable environmental, health and safety policies in place and no potential environmental and social liabilities were identified in the existing substations. Supervision of the on-going two transmission projects with PLN shows that close supervision and monitoring of contractor performance is needed to ensure the Standard Operating Procedures are followed. Page 2 of 6 Natural Habitats OP/BP 4.04 No Site visits and initial screening undertaken by the task team has determined that the proposed subprojects in PLN's list for the first group will not cause conversion of degradation of critical or other natural habitats. Most project activities will take place at the existing sites of the substations or in the vicinity of the existing substations. However, newly proposed subprojects by PLN for the second group may have Public Disclosure Copy impacts on natural habitats. Eligibility criteria for financing subprojects will include provisions that subprojects having impacts on natural habitats will be excluded from the project financing. Forests OP/BP 4.36 No Site visits and screening undertaken by the task team has determined that the proposed subprojects proposed by PLN for the first and second group will not cause impacts on forest. Pest Management OP 4.09 No Physical Cultural Resources OP/BP 4.11 No It is expected that the proposed project will not involve any sites with archeological, paleontological, historical, religious or of unique natural value as defined under the policy. However, chance finds procedures would be included as part of the EMP and ESMF. Indigenous Peoples OP/BP 4.10 Yes Site visits and screening undertaken by the task team has determined that Indigenous Peoples as defined by OP 4.10 are not present in, nor have collective attachment to the project area under the proposed list of subprojects under the first group and second group. However, newly proposed subprojects by PLN in the second group may be located in areas where indigenous communities are present. An Indigenous People Planning Framework (IPPF) will be developed during preparation. Involuntary Resettlement OP/BP 4.12 Yes A new 150/20 kV power substation requires an enclosed leveled site, typically of less than 2 hectares. Some substations may need construction of a short transmission line connecting to existing transmission lines, upgrading of existing or construction of short new access roads. Land for these structures may require temporary and permanent land acquisition from forest, residential and agriculture land. Scales of impacts are quite limited and can be minimized due to the flexibility in site selection. Rehabilitation of existing substations does not require land acquisition and will be implemented within the premises of these substations. However, some expansion subprojects will require a small amount of land, normally adjacent to the existing sites. For many expansion and new subprojects in PLN#s proposed list, the site/land has Public Disclosure Copy already been obtained by PLN. Abbreviated LARAPs will be prepared for all new substations and expansion of existing substations that requires land acquisition in the first group and any subproject identified and defined prior to appraisal in the second group. For the second group subprojects, a Land Acquisition and Resettlement Policy Framework will be prepared by PLN. A LARAP for each subproject requiring land acquisition will be developed during project implementation, when the subprojects are proposed for financing. Safety of Dams OP/BP 4.37 No Projects on International Waterways OP/BP No 7.50 Projects in Disputed Areas OP/BP 7.60 No 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 following impacts are identified during construction for rehabilitation and expansion of 150/20 kV and 70/20 kV substations: (i) increased level of dust and noise from the use and movement of machinery; (ii) non toxic solid waste during construction; (iii) oil spill or leakage from machinery or transformers; (iv) possible discovery of PCB and (v) worker health and safety from existing EMF. Impacts during operation include (i) oil leaks from transformers; (ii) fire and emergency preparedness; (iii) solid wastes and (iv) worker health and safety. Other issues for equipment upgrades and additions that have been identified include managing potential legacy soil contamination and storing and disposing of old transformers. For new substations, in addition to the above impacts, other issues include the management of vegetation clearance and sediment and erosion control. PLN have advised that PCB are not in use in any of the substations that will be upgraded or extended, and are not used in any new substations. As a precaution, PCB has been included in the list of potential issues to be managed for each subproject. Page 3 of 6 Land acquisition processes, including public consultation and satisfactory compensation for the population residing in the project area is the main social issue under the project. Since land acquisition is limited, impacts on the individual project affected people (PAP) is normally modest and limited in the acquisition of small pieces of land or cutting down of a few trees. There will be no worker camps. The social nuisances from construction (noise, dust, traffic etc), will be managed under the EMP. With regards to land acquisition, in Group 1 there is no new substations to be constructed. Public Disclosure Copy Draft LARAP of two subprojects which are proposed for Group 2 have been reviewed. These are Gedong Tataan Substation in Lampung and Tembilahan Substation in Riau. The land required for each substation is about 20,000m2 (2 hectares) and are owned by only one land owner in case of Gedong Tataan and four land owners in case of Tembilahan. No significant impact to the land owners was observed as the lands are not used for productive purpose and none of the owners earn income from the lands. 2. Describe any potential indirect and/or long term impacts due to anticipated future activities in the project area: No long term adverse impact is envisaged due to the project activities. The reinforcement of substations will result in improvement of power supply adequacy and quality in the project areas, which is an ingredient for economic growth and household quality of life. 3. Describe any project alternatives (if relevant) considered to help avoid or minimize adverse impacts. For those subprojects in Group 1 which involves land acquisition, alternatives were considered to minimize impacts on resettlement and environment. For new substations in Group 2, the specific location is flexible within a defined area. The impact on resettlement and environment will be assessed for alternative sites as part of the site selection process. 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. The borrower has prepared the following documents: 1. An EMP for upgrades and expansions of existing substations. This EMP for Upgrades covers a large number of small, discrete substation upgrade and / or extension subprojects, across five PLN Project Offices. This approach replaces a large number of repetitive and identical EMPs. These projects have very small footprints, mostly within the boundaries of existing substations, and the severity and risk environmental and social impacts are low. The potential environmental and social issues of most of these subprojects are very similar (with few exceptions which will be separately addressed in the EMP). Furthermore, since all subcomponents will be owned by PLN, the EMP aspects of: institutional arrangements, occupational health and safety, and emergency preparedness and response systems are established by PLN corporate policy and will be the same for all of the subprojects. The EMP contains standard mitigation and monitoring plans to cover typical impacts from upgrading equipment and installing new equipment at substations, including worker health and safety, earthworks and solid and hazardous waste management. The EMP also contains standard EMP monitoring, reporting and review processes to streamline processes across the Project Offices and the subprojects. However, each subcomponent is unique in the sense that: (a) it is situated at its’ own unique location, (b) public consultations would involve different affected groups, and (c) the outcome of the public consultation may present special environmental or social issues. Therefore there is a screening process for each site to determine whether there are social and /or environmental risks beyond those covered in the standard mitigation and monitoring plans. Additional specific mitigation plans and monitoring plans have been developed for those sites with unique situations. 2. An Environmental and Social Management Framework (ESMF), to ensure that subprojects in Group 2 to be financed under IPTD2 Public Disclosure Copy meets World Bank safeguard policy requirements. The framework provides guidance for preparation, appraisal and implementation of Environmental Management Plans and the roles and responsibilities of each institution. It is expected that the subprojects will also meet all relevant environment requirements and processes under Indonesian regulations and laws. Note that for the type and scale of the projects, no AMDAL (EIA) is required under the Indonesian regulations and laws for any of the proposed activities. For a new substation associated with a new transmission line, an UPL / UKL (EMP and Environmental Monitoring Plan) is required. There is no environment requirement for a new substation, which is connected to existing transmission lines and for substation upgrades and extensions. Environmental Codes of Practice (ECOP- standard environmental specifications for contractors) have been developed for the five types of physical works listed below as part of ESMF: • Rehabilitation of substations: install/replace transformers and other equipments within their existing property boundaries; • Expansion of substations: require additional land adjacent to existing substations; • Construction of new substations: construction of typical on-site components of a substation; • Construction of transmission branches to connect new substations to the existing sub-transmission network; • Upgrading of existing access roads and a new road. 3. Draft EMPs for two new subprojects in Group 2, i.e., Gedong Tataan and Tembilahan substations have been reviewed by the Bank and found satisfactory. However, these subprojects will be fully appraised with other subprojects in Group 2 during implementation. Environment impacts will be mitigated according to measures set out in the EMPs. Measures include the following: (i) the construction site will be sprinkled with water during dusty conditions (ii) construction activities will be performed only during normal working hours; If construction activities have to be performed before or after the specified time limits, the local society must be notified in advance; (iii) Contaminated soils and solid waste will be removed and disposed to sites approved by local authorities; (iv) Bidding documents shall prohibit procurement of equipment containing PCB. For the construction phase, the EMP for each substation (including the Environmental Codes of Practice) will be included in the bidding documents and contracts as legal obligations for contractors to implement. During operation, the EMP will be transferred to the respective operating entities for implementation. 4. Land Acquisition and Resettlement Policy Framework as guidance for preparing and implementing the land acquisition of the subprojects in Group 2. The Framework provides guidance on general principles of land acquisition and resettlement that conform with the World Bank’s OP 4.12 on Involuntary Resettlement, the requirement for preparing the LARAP for subprojects proposed for financing, including the process of LARAP approval and implementation; socioeconomic survey and inventory of affected people and assets; compensation Page 4 of 6 scheme and categories of affected persons; institutional responsibilities; monitoring and evaluation and the grievance mechanism. 5. Indigenous Peoples Planning Framework (IPPF) providing guidelines for the preparation and implementation of Indigenous Peoples Plan in Group 2, if the subprojects will affect indigenous peoples. The Framework regulates the need for preparing the Indigenous Peoples Plans for any proposed subprojects that are found to affect indigenous peoples. The Framework also provides guidelines for the indigenous peoples screening in the project area, preparation of Social Assessment when necessary, the main principles to be followed when the subprojects affect indigenous peoples, reporting, monitoring and documentation and the grievance mechanism. Public Disclosure Copy The Framework describes how the project implementing unit can ensure that free, prior and informed consultations are undertaken, in a language spoken by, and location convenient for, potentially affected IP. The views of IP are to be taken into account during preparation and implementation of any subproject, while respecting their current practices, beliefs and cultural preferences. The outcome of the consultations will be documented into the subproject documents. 6. Draft LARAPs for two new substations in Group 2 i.e Tembilahan Substation in Riau province, and Gedong Tataan Substation in Lampung province have been reviewed by the Bank and found satisfactory. Full appraisal of the substations will be fully carried out later during implementation with other subprojects in Group 2 In both subprojects, since the land required for new substation is more than one hectare, the process of land acquisition will follow the national regulation to use the Land Acquisition Committee (LAC) of the respective local government and the land price for compensation will be appraised by the land appraisal team/institution. Due diligence was conducted for Batulicin substation in South Kalimantan province, for which the land acquisition was completed in 2010. The World Bank will finance the expansion of the substation. The process of land acquisition was followed national regulation (Perpres 36/2005 jo 65/2006) and its implementation guideline, Regulation of BPN Head No. 3/2007. Land acquisition was implemented by Kabupaten Land Acquisition Committee (LAC) of Kabupaten Tanah Bumbu, South Kalimantan. Value of land was valued by the land appraisal team established by the LAC. This value became a reference during the negotiation. Borrower capacity: PLN will be the implementing agency and five regional project management offices (PMOs) in Java-Bali, Sumatera, Kalimantan and Sulawesi will be directly in charge of managing construction of the subprojects, including safeguard responsibilities. The Planning and Risk Management Directorate (PRMD) and Construction Directorate (CD) at PLN headquarters will be responsible for overall coordination and oversight during project preparation and implementation. PLN has experience in preparing and implementing two on-going transmission projects financed by the World Bank. At PLN headquarters a dedicated unit within the PRMD is responsible for coordinating environmental and social issues during preparation and implementation of the project. The unit’s manager and staff who are also coordinating other World Bank financed projects have adequate knowledge and experience with the Bank policies. PLN headquarters is responsible for the preparation of ESMF, LARPF, and IPPF and during implementation, for overall coordination and reporting. It was agreed that PLN will employ a Project Management Consultant (PMC) including an environment/social specialist within a month after the effectiveness of the loan. The environment/social consultant will support the Environment Unit of PRMD to oversee project implementation. All five PMOs are staffed with dedicated environment and social staff, who are familiar with the Indonesian regulation on environment, EIA and EMP processes (called Amdal and UKL/UPL respectively) and land acquisition. The PMO for Java-Bali and the PMO for Sumatra 2 (South Public Disclosure Copy Sumatra) have experience with implementation of WB financed projects. The PMOs for Sumatra 1(North Sumartra), Kalimantan, and Sulawesi have no previous experience with the WB project but each has competent environment and social specialists as full time permanent staff. The PMOs are directly responsible for preparation and implementation of EMPs and, if required, LARAPs and IP Plans. During preparation, environmental and social staff of all five PMOs received training in EMP, LARAP and IPP from the Bank team in October 2011. During supervision, further training will be provided to PLN staff in charge of social and environmental management. Progress of EMP, LARAP, and IP preparation and implementation will be carefully monitored. 5. Identify the key stakeholders and describe the mechanisms for consultation and disclosure on safeguard policies, with an emphasis on potentially affected people. The key stakeholders have been identified as the land owners and occupiers (in the case of new substation sites) and the immediate community surrounding the subproject sites. All safeguard documents have been publicly disclosed for at least two weeks and comments sought from the public. Disclosure notices have been broadcasted online and through newspapers at the provincial branch offices and main offices of the PMOs from December 28, 2011 to January 10, 2012. Documents were available from PLN in Indonesian (hard copies in the offices and a soft copy on the PLN website) for the public to read and comment on. Each of the provincial branch offices of the PMOs where the subprojects are located advertised an ‘open office’ for 10 working days from December 28, 2012 to January 10, 2012, during which people could drop in to discuss the project with staff knowledgeable about the project. There were no visitors to the open office days, and PLN received no comments or feedback from the public or key stakeholders. Consultation details have been recorded in the final versions of the documents. For the two new substation sites in Group 2 for which LARAP and EMP have been prepared (Gedong Tataan and Tembilahan) one public meeting and consultations has been carried out at or near the proposed sites for affected stakeholders to attend. The consultation was undertaken in parallel with the survey for the LARAP and EMP preparation in November 2011. All feedback received has been recorded in the final versions of the documents. For all other new substation sites in the second group, the PMOs will hold at least one public consultation meeting at or near the proposed sites. For all substation upgrades and extensions the documents will be disclosed online and through newspapers, documents will be available in English and Bahasa for comment, and the PMOs will hold ‘open office’ days as close to the sites as possible with staff available to consult with the public. Page 5 of 6 B. Disclosure Requirements Date Environmental Assessment/Audit/Management Plan/Other Was the document disclosed prior to appraisal? Yes Date of receipt by the Bank 13-Jan-2012 Public Disclosure Copy Date of "in-country" disclosure 28-Dec-2011 Date of submission to InfoShop 16-Jan-2012 For category A projects, date of distributing the Executive Summary of the EA to the Executive Directors Resettlement Action Plan/Framework/Policy Process Was the document disclosed prior to appraisal? Yes Date of receipt by the Bank 13-Jan-2012 Date of "in-country" disclosure 28-Dec-2011 Date of submission to InfoShop 16-Jan-2012 Indigenous Peoples Development Plan/Framework Was the document disclosed prior to appraisal? Yes Date of receipt by the Bank 13-Jan-2012 Date of "in-country" disclosure 28-Dec-2011 Date of submission to InfoShop 16-Jan-2012 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. If in-country disclosure of any of the above documents is not expected, please explain why: C. Compliance Monitoring Indicators at the Corporate Level (to be filled in when the ISDS is finalized by the project decision meeting) OP/BP/GP 4.01 - Environment Assessment Are the cost and the accountabilities for the EMP incorporated in the credit/loan? Yes [ ] No [ ] NA [ ] OP/BP 4.10 - Indigenous Peoples If the whole project is designed to benefit IP, has the design been reviewed and approved by Yes [ ] No [ ] NA [ ] the Regional Social Development Unit or Sector Manager? Public Disclosure Copy OP/BP 4.12 - Involuntary Resettlement If yes, then did the Regional unit responsible for safeguards or Sector Manager review the Yes [ ] No [ ] NA [ ] plan? The World Bank Policy on Disclosure of Information Have relevant safeguard policies documents been sent to the World Bank's Infoshop? Yes [ ] No [ ] NA [ ] Have relevant documents been disclosed in-country in a public place in a form and language Yes [ ] No [ ] NA [ ] that are understandable and accessible to project-affected groups and local NGOs? All Safeguard Policies Have satisfactory calendar, budget and clear institutional responsibilities been prepared for Yes [ ] No [ ] NA [ ] the implementation of measures related to safeguard policies? Have costs related to safeguard policy measures been included in the project cost? Yes [ ] No [ ] NA [ ] Does the Monitoring and Evaluation system of the project include the monitoring of safeguard Yes [ ] No [ ] NA [ ] impacts and measures related to safeguard policies? Have satisfactory implementation arrangements been agreed with the borrower and the same Yes [ ] No [ ] NA [ ] been adequately reflected in the project legal documents? III. APPROVALS Task Team Leader: Anh Nguyet Pham Approved By: Sector Manager: Name Franz R. Drees-Gross (SM) Date: 25-Mar-2012 Page 6 of 6