INTEGRATED SAFEGUARDS DATASHEET APPRAISAL STAGE I. Basic Information Date prepared/updated: 04/06/2012 Report No.: AC6667 1. Basic Project Data Original Project ID: P101473 Original Project Name: Urban Water Supply and Sanitation Project Country: Ethiopia Project ID: P129174 Project Name: Urban Water Supply and Sanitation Project Additional Financing Task Team Leader: Yitbarek Tessema Estimated Appraisal Date: March 19, 2012 Estimated Board Date: May 31, 2012 Managing Unit: AFTUW Lending Instrument: Specific Investment Loan Sector: Water supply (41%);Wastewater Treatment and Disposal (41%);Sanitation (15%);Sub-national government administration (2%);Central government administration (1%) Theme: Urban services and housing for the poor (40%);Other urban development (20%);Other human development (20%);Municipal governance and institution building (20%) IBRD Amount (US$m.): 0 IDA Amount (US$m.): 150 GEF Amount (US$m.): 0 PCF Amount (US$m.): 0 Other financing amounts by source: BORROWER/RECIPIENT 0.00 0.00 Environmental Category: B - Partial Assessment Simplified Processing Simple [] Repeater [] Is this project processed under OP 8.50 (Emergency Recovery) Yes [ ] No [X] or OP 8.00 (Rapid Response to Crises and Emergencies) 2. Project Objectives The Development Objective of the Urban Water Supply and Sanitation Project is to increase access to sustainable water supply and sanitation services in Addis Ababa and four secondary cities. Because of cost over run and need to include one more city, an additional financing is required. The objective will be maintained in the AF with slight modification to reflect the addition of the new city and provide more flexibility. i.e the revised development objective will be “to increase access to sustainable water supply and sanitation services in Addis Ababa and a few secondary cities.� Accordingly, the objective will be achieved by: i) Producing more water for customers and extending the distribution network to unserved areas. ii) Improving the operational efficiency of the participating water utilities by reducing non revenue water and improving financial management. iii) Strengthening the autonomy of existing water boards and utilities and introduction of performance based contracts with utilities. iv) Out sourcing selected activities to private sector providers to increase capacity and attract more investment. v) Constructing public sanitation facilities in low income areas, finance priority elements of municipal sanitation plans, and promote improved hygiene and sanitation practices. 3. Project Description The Additional Financing will be used to: i) complete the original project activities that faced financing gap due to cost overrun incurred in the course of implementation caused by an unanticipated design change and ii) include support to the second federal city that is in great need of the WSS improvement intervention. Addis Ababa city: Under the current project, provision is made to improve the sanitation situation through rehabilitation and expansion of the waste water treatment plant for the southern catchment of Addis Ababa city. The City’s ongoing urban renewal project coupled with the rapid urbanization of the city, called for a change of design from what was anticipated during project preparation. As a result, additional financing of US$100 million is sought to finance upgraded design. Secondary cities: The source of water for Gondar city was found at a well field 30km away from the city. As a result, the city faced a financing gap of US$ 10 million to convey the water supply and complete the distribution system. The price escalation of imported items for the construction of water supply and sanitation works and the increased cost of related construction supervision activities due to the increase in the cost of fuel has created a financing gap of approximately US$ 18 million to fully implement the proposed improvement activities in Hawassa, Jimma, and Mekelle cities. Dire Dawa City: The GOE has also requested for additional financing of US$ 22 million to respond to a pressing demand for improved WSS from the second federal city of Dire Dawa. DireDawa is the second most populous Federal city with a population of 267,311 as per the 2007 census result. In the last 30 years, the city has grown drastically including a fourfold stretch of its administrative area. Not much has been done on the water supply production front leaving the city with a wide demand- supply gap. The city is served with 301 l/s (22,000 M3/day) of supply from 12 bore holes scattered in the city and one spring source. Though it is one of the two federal cities and is identified as one of the growth corridors, it falls into the category of the secondary cities because of its population size, the water supply and sanitation situation as well as the utility management arrangement. It requires an increase in water production, improvement in NRW management, and enhancement in its operational efficiency. The US$ 150 million Additional Financing will therefore be used to fill the financing gap to complete the work in the original five cities and to include additional activities in Dire Dawa City. 4. Project Location and salient physical characteristics relevant to the safeguard analysis The project will be implemented in urban areas, namely, Addis Ababa, Hawassa, Gondar, Jimma, Mekelle, and Dire Dawa Cities. The proposed sites for additional financing are not situated in important habitats and ecosystems. Potential negative impacts subprojects to be implemented by the additional financing will be avoided or mitigated using the ESMF and ESIA. Borrower’s Institutional Capacity for Safeguard Policies At the federal level, the project is implemented by the Ministry of Water and Energy (MoWE). The Ministry has an environmental Unit. This Unit has been given the mandate to monitor the implementation of the environmental management of projects owned by the MoWE. It is envisaged that this Unit will regularly monitor the implementation of ESMF and ESIAs of the Water Supply and Sanitation Project on a regular basis. At city level, project coordinators are the focal persons to ensure implementation of ESMF and ESIA. The Project has also employed an environmental specialist who will follow the day-to- day implementation of environmental management plans developed for the project. The environment specialist will have regular contact with the focal person at the regional level. However, the Borrower’s institutional capacity, both at federal and regional levels, for the implementation of the Bank’s safegu policies should be further strengthened with training to ensure robust identification, assessment and mitigation of potential environmental and social impacts. 5. Environmental and Social Safeguards Specialists Mr Shankar Narayanan (SASDS) Mr Asferachew Abate Abebe (AFTEN) 6. Safeguard Policies Triggered Yes No Environmental Assessment (OP/BP 4.01) X Natural Habitats (OP/BP 4.04) X Forests (OP/BP 4.36) X Pest Management (OP 4.09) X Physical Cultural Resources (OP/BP 4.11) X Indigenous Peoples (OP/BP 4.10) X Involuntary Resettlement (OP/BP 4.12) X Safety of Dams (OP/BP 4.37) X Projects on International Waterways (OP/BP 7.50) X Projects in Disputed Areas (OP/BP 7.60) X 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: 1. Potential safeguard issues associated with this project include (i) soil and water pollution, loss of vegetation, soil erosion, (ii) loss of livelihoods or access to economic assets due to the planned rehabilitation and construction activities, and (iii) an increase in water abstraction. The scope of the planned investments will not incur any large scale or irreversible impacts. 2. Describe any potential indirect and/or long term impacts due to anticipated future activities in the project area: The planned project activities will not incur any indirect and /or long term impacts. 3. Describe any project alternatives (if relevant) considered to help avoid or minimize adverse impacts. This project has been designed to support the operationalization of a broader growth strategy, interpretation of Ethiopia’s Integrated Water Resources Management policy, and contribution to the achievement of the Millennium Development Goals and interim country goals. Hence, project alternatives were not discussed. 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. Given that the sub-projects in the AF are similar to those in the original project and do not have significant adverse environmental and social impacts, the AF project will remain as a Category B project. Since the exact locations of the planned investments and their potential localized adverse environmental and social impacts could not be determined prior to appraisal of original project in 2007, the Borrower has prepared (i) an Environmental and Social Management Framework (ESMF); and (ii) a Resettlement Policy Framework (RPF). The ESMF outlines the environmental and social screening process to be applied to future investments in Addis and secondary cities at the planning stage. The ESMF also includes an Environmental and Social Management Plan (ESMP), Environmental Guidelines for Contractors and guidance on handling/managing physical cultural resources. The RPF outlines policies and procedures to be applied in the event that future investment activities require land acquisition. Given the Borrower’ limited capacity to address safeguard policy issues, the project will include support for the effective implementation of the ESMF and RPF. The borrower has completed the following EIA and ESIA studies for the sub-projects listed below and is diligently implementing the recommendations of each of these studies. This process is being regularly monitored through implementation support missions on the project. 1-Addis Ababa In city wells environmental audit-EIA-Completed – Disclosed on March 29, 2012 2-Addis Ababa short term availability of water from Dire and Legedadi reservoir - ESIA-Under Review 3-Addis Ababa 10 test wells -ESIA-Completed – Disclosed on March 29, 2012 4-Hawassa City water supply -ESIA-Completed – Disclosed on March 27, 2012 5-Hawassa City Sludge drying bed-ESIA-Draft commented 6-Jimma City water supply-ESIA-Completed – Disclosed on April 2, 2012 7-Mekelle city water supply-ESIA-Completed – Disclosed on March 29, 2012 8-Angereb Dam safety assessment-Safety assessment-Completed and recommendation being implemented 9-Gondar City Water Supply-ESIA-Completed – Disclosed on March 28, 2012 The ESIAs have been cleared by the Bank and adequately capture the environment and social issues. For the Hawassa project which is close to being commissioned and the 3 other subprojects that have been or are being implemented, the Government acquired land without preparing RAPs. Management: i) undertook a quick review of the completed ESIAs to determine the need to conduct RAP audits and engaged consultants to conduct the audits; ii) the information generated from this exercise confirms that each of the affected PAPs (a total of 31 households and institutions) in each of the 4 sub-projects have been compensated as per the entitlements outlined in the Resettlement Policy Framework for the project.iii). As the compensation complies with OP 4.12, ex-post Abbreviated RAPs (ARAPs) will not be prepared. However, the Government is committed to preparing RAPs or ARAPs during project implementation should any land acquisition leading to involuntary resettlement and/or restrictions of access to resources or livelihoods arise. The RAP audit has recommended that in all the cities, the Grievance Redress Mechanism needs to be considerably strengthened. It is also important that there be effective communication to all the PAPS about the existence and procedures of this mechanism. Since the project will rely on the performance of existing dams, the Borrower has carried out a Dam Safety Assessment in December 2006; and the project will implement the recommendations of the same. OP 7.50 was triggered in the original project because the project affects international waterways and that the notification has been done, and that therefore no further notification is needed. There will be three basic approaches to ensuring adequate safeguards compliance: A. Use of ESMF and RPF i. In Addis Ababa City: Project activities will involve the expansion of a waste water treatment plant. The location of the site of the plant is known; however, the technology to be used for wastewater treatment, as well as where and how the trunk and secondary lines, will be installed during the expansion have not yet been determined. ii. In Dire Dawa City: The sub-project will involve development and supply of drinking water from groundwater. The City has so far identified the well fields for developing 23 wells. In the AF, four wells will be dug to supplement the water supply in the City. The specific sites for developing the four wells have not yet been identified. iii. In Hawassa city: The original sub-project from a spring source is under implementation for which an ESIA has been developed. The additional financing will finance development and supply of drinking water from groundwater to achieve the original project target. Preliminary design has not yet been completed. For these three Cities, ESMF and RPF checklist will be used to determine the kind of safeguard instrument required when detailed information is known. B. Preparation of a new ESIA In Gonder City: Preliminary design work has been completed and sub-projects screened using ESMF and RPF triggered the need for the preparation of ESIA. The ESIA for the Gonder was cleared by the Bank and disclosed in country during the AF project appraisal. A copy is also at the Infoshop. C. Implementation of existing ESIA As indicated in Table 1 above, ESIAs have been prepared for Addis Ababa, Jimma, and Mekele Cities following the procedures set in the ESMF. The environmental management plans described in these ESIAs will be enforced to ensure the sustainability of activities planned in the AF. 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 are the Ministry of Water Resources, the Regional Water Resources Development Bureaus, the Water Boards, the Water Utility Operator, and consumers. The ESMF has been prepared in consultation with AAWSA in Addis Ababa, with the Town Water Boards of Jimma, Awassa, Gonder, and Mekele cities that would potentially benefit from the Urban Water Supply and Sanitation Project, with the Environmental Protection Agency (federal level), and with the World Bank Country Office. Staff involved in the operation of water systems in: Addis Ababa, Hawassa, Jimma, Gonder, Mekele, and Dire Dawa have also been interviewed. The ESMF includes provisions for public consultations during the screening process of planned investments as well as approval and disclosure of the screening results. The ESMF and RPF have been disclosed in Ethiopia and at the Bank’s Infoshop during the original project appraisal in 2007. EIAs and ESIAs have been disclosed during project implementation. B. Disclosure Requirements Date Environmental Assessment/Audit/Management Plan/Other: Was the document disclosed prior to appraisal? Yes Date of receipt by the Bank 01/16/2007 Date of "in-country" disclosure 02/14/2007 Date of submission to InfoShop 02/14/2007 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 01/15/2007 Date of "in-country" disclosure 02/14/2007 Date of submission to InfoShop 02/14/2007 Indigenous Peoples Plan/Planning Framework: Was the document disclosed prior to appraisal? Date of receipt by the Bank Date of "in-country" disclosure Date of submission to InfoShop Pest Management Plan: Was the document disclosed prior to appraisal? Date of receipt by the Bank Date of "in-country" disclosure Date of submission to InfoShop * If the project triggers the Pest Management and/or Physical Cultural Resources, 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 Does the project require a stand-alone EA (including EMP) report? Yes If yes, then did the Regional Environment Unit or Sector Manager (SM) Yes review and approve the EA report? Are the cost and the accountabilities for the EMP incorporated in the Yes credit/loan? OP/BP 4.11 - Physical Cultural Resources Does the EA include adequate measures related to cultural property? Yes Does the credit/loan incorporate mechanisms to mitigate the potential Yes adverse impacts on cultural property? OP/BP 4.12 - Involuntary Resettlement Has a resettlement plan/abbreviated plan/policy framework/process Yes framework (as appropriate) been prepared? If yes, then did the Regional unit responsible for safeguards or Sector Yes Manager review the plan? OP/BP 4.37 - Safety of Dams Have dam safety plans been prepared? Yes Have the TORs as well as composition for the independent Panel of Experts N/A (POE) been reviewed and approved by the Bank? Has an Emergency Preparedness Plan (EPP) been prepared and arrangements N/A been made for public awareness and training? OP 7.50 - Projects on International Waterways Have the other riparians been notified of the project? Yes If the project falls under one of the exceptions to the notification N/A requirement, has this been cleared with the Legal Department, and the memo to the RVP prepared and sent? Has the RVP approved such an exception? N/A The World Bank Policy on Disclosure of Information Have relevant safeguard policies documents been sent to the World Bank's Yes Infoshop? Have relevant documents been disclosed in-country in a public place in a Yes form and language that are understandable and accessible to project-affected groups and local NGOs? All Safeguard Policies Have satisfactory calendar, budget and clear institutional responsibilities Yes been prepared for the implementation of measures related to safeguard policies? Have costs related to safeguard policy measures been included in the project Yes cost? Does the Monitoring and Evaluation system of the project include the Yes monitoring of safeguard impacts and measures related to safeguard policies? Have satisfactory implementation arrangements been agreed with the Yes borrower and the same been adequately reflected in the project legal documents? D. Approvals Signed and submitted by: Name Date Task Team Leader: Mr Yitbarek Tessema 04/06/2012 Environmental Specialist: Mr Asferachew Abate Abebe 04/06/2012 Social Development Specialist Mr Shankar Narayanan 04/06/2012 Additional Environmental and/or Social Development Specialist(s): Approved by: Regional Safeguards Coordinator: Ms Alexandra C. Bezeredi 04/06/2012 Comments: Sector Manager: Mr Ian Bannon 04/06/2012 Comments: