INTEGRATED SAFEGUARDS DATA SHEET CONCEPT STAGE Report No.: ISDSC308 Public Disclosure Copy Date ISDS Prepared/Updated: 01-Dec-2011 I. BASIC INFORMATION A. 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: 23-Jan-2012 Estimated Board Date: 22-Mar-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 39.00 International Bank for Reconstruction and Development 375.00 AUSTRALIA Australian Agency for International Development 2.00 Total 416.00 Environmental Category: B - Partial Assessment Is this a Repeater project? Yes B. Project Objectives 11. The development objective of the proposed project is to assist the Borrower to meet growing electricity demand and increase access to electricity in project areas in a sustainable manner. It will achieve this objective by strengthening and expanding the capacity of the power transmission networks in Java-Bali and other large islands in East and West Indonesia and improving the Borrower's capacity to plan and operate the transmission and distribution network in an efficient and transparent way through introduction of smart grid technologies. Public Disclosure Copy C. Project Description A. Concept 1. The proposed project is a follow-up operation of the on-going Indonesia Power Transmission Development Project (IPTD # Ln. 7940-ID) the implementation of which is satisfactory. The proposed project will continue expansion of 150 kV sub-transmission systems in Java-Bali and Sumatra, which has been partly covered by the IPTD and support extension of the existing 150 kV sub-transmission systems in Kalimantan and Sulawesi to meet the increasing demand and to increase access rates in these islands. In addition, the project will include a technical assistance component to build the capacity of PLN in introducing modern technologies to improve the supply and demand- side efficiency of the power system. Description 2. The proposed project would consist of four components as described below. The preliminary cost estimate is about US$416 million in which $375 million is to be provided by IBRD, $2 million by a bilateral donor on a grant basis 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 mostly in Jakarta, West Java & Banten, Central 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. Component 4: Technical Assistance for Capacity Building for Planning and Implementation of Smart Grid Technologies for PLN Transmission and Distribution Systems ($2 million Co-financing Grant). Under this component, technical assistance will be provided to PLN to build its capacity in assessment and planning for introduction of smart grid technologies for Indonesia#s transmission and distribution (T&D) networks. The component includes consulting services and training of PLN staff for assessment of smart grid application for the T&D networks; preparation of a road map for a smart grid program; and preparation of feasibility studies for selected prospective investments. This component is expected to be financed by a co-financing grant to the project. The source of financing is to be defined during preparation. Public Disclosure Copy Subprojects under Component 1-3 will be prepared and implemented in two groups. The first group includes all the subprojects which are of priority and in advanced stage of preparation. All subprojects in the first group will be fully appraised and have the bidding documents for goods and works ready by the time of approval of the Project by the World Bank's Board of Executive Directors. The second group includes the subprojects that are preliminarily identified but where their precise sitting alignments are not known during preparation and other subprojects that can be brought forward by PLN during implementation. The subprojects in the second group are subject to Bank appraisal in accordance with a set of the eligibility criteria, which will be agreed during project preparation. A Land Acquisition, Resettlement Policy Framework (LARPF), Indigenous People Planning Framework (IPPF), and Environment and Social Management Framework (ESMF), which provide guidance for preparation of safeguards plans for the subprojects in the second group will be prepared and appraised during preparation. The subprojects that meet the eligibility criteria will be financed on a first-come, first-appraised basis until all allocated funds are committed. A preliminary list of subprojects in two groups is provided by PLN, which will be updated and refined during the project preparation. PLN will be the implementing agency. The procurement activities will be carried out centrally by the procurement committee to be established at PLN Headquarters, consisting of representatives of related functional departments. Five regional project offices in Java-Bali, Sumatra, Kalimantan and Sulawesi will be directly in charge of managing construction of Components 1-3. Component 4 will be managed by PLN#s Planning Department through the newly established Working Team on Smart Grids, consisting of representatives of related functional departments. Disbursement and financial reporting will be carried out by PLN#s Financial and Treasury Departments, respectively, with the support of the five regional project offices. PLN Planning and Construction Departments at PLN Headquarters will be responsible for overall coordination and oversight during project preparation and implementation. D. 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 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 (1-2 km long) to connect the substation to the existing network and in few cases, upgrading of an existing road or construction of a short new access road. A new substation requires an enclosed, leveled site free of any vegetation or human habitation (except for substation operators), typically measuring about 150m x 100 m. For substations that involve construction of connecting 150 kV transmission lines or new access roads or upgrading of Public Disclosure Copy existing access roads, 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 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 the first group. Similarly, no natural and or critical habitats will be impacted by the subprojects of the first group. 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. E. Borrowers Institutional Capacity for Safeguard Policies PLN will be the implementing agency. Five regional project offices in Java-Bali, Sumatra, Kalimantan and Sulawesi will be directly in charge of managing construction of Components 1-3, including safeguards responsibilities. Component 4 will be managed by PLN Planning Department through the newly established Smart Grid Working Team, consisting of representatives of related functional departments. PLN Planning and Construction Departments 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 Planning Department is responsible for coordinating environmental and social issues during preparation and implementation of the project. The unit manager and staff, who are also coordinating other World Bank financed projects, have adequate knowledge and experience with the Bank policies. All five regional offices are staffed with dedicated environment and social staff, who are familiar with the Indonesian regulations on environment, EIA and EMP processes (called AMDAL and UKL UPL respectively) and land acquisition. These staff are responsible for supervising and implementing EIAs, EMPs and land acquisition for PLN financed or other donor financed projects. Two regional project offices in charge of Java Bali and South Sumatra regions have been managing implementation of similar sub-transmission subprojects financed by the World Bank and therefore are familiar with the Bank's safeguard policies as well as with preparation and implementation of the safeguards plans. However the other three regional offices in North Sumatra, Kalimantan and Sulawesi have no previous experience with the Bank#s safeguard policies. Three training sessions on World Bank environment and social safeguards policies were carried out in October 2011 for staff from all five regional project offices who are responsible for handling the environment and social issues. The training was focused on the preparation of the safeguard instruments (EMP and LARAP). F. Environmental and Social Safeguards Specialists on the Team Ninin K. Dewi (EASIS) Warren Waters (EASIS) Andrew Daniel Sembel (EASIS) Penelope Ruth Ferguson (EASIS) II. SAFEGUARD POLICIES THAT MIGHT APPLY Public Disclosure Copy Safeguard Policies Triggered Yes No TBD Explanation Environmental Assessment OP/BP 4.01 ✖ 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 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 Public Disclosure Copy 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. Natural Habitats OP/BP 4.04 ✖ 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 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 ✖ 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 ✖ Physical Cultural Resources OP/BP 4.11 ✖ 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 ✖ 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 Safeguard Policies Triggered Yes No TBD Explanation may be located in areas where indigenous communities are present. An Indigenous People Planning Framework (IPPF) will be developed during preparation. Public Disclosure Copy Involuntary Resettlement OP/BP 4.12 ✖ 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 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 ✖ Projects on International Waterways OP/BP ✖ 7.50 Projects in Disputed Areas OP/BP 7.60 ✖ III. SAFEGUARD PREPARATION PLAN Public Disclosure Copy A. Tentative target date for preparing the PAD Stage ISDS: 19-Dec-2011 B. Time frame for launching and completing the safeguard-related studies that may be needed. The specific studies and their timing1 should be specified in the PAD-stage ISDS: The project will prepare the following safeguard instruments: 1. Environmental and Social Management Framework (ESMF), which provides guidance for preparation of EMPs, roles and responsibilities of the institutions, and timing for the second group of subprojects. Environmental Codes of Practice (ECOP- standard environmental specifications for contractors) will be 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. 2. Land Acquisition and Resettlement Policy Framework (LARPF) which provides guidance for preparation of LARAP, roles and responsibilities of the institutions and timing for the second group of subprojects. 3. Indigenous People Planning Framework (IPPF) which provides guidance for preparation of Indigenous People Development Plan (IPDP), roles and responsibilities of the institutions and timing of those subprojects of the second group which trigger the Indigenous People Policy. 4. A Environmental Management Plan for Upgrades that will cover all subprojects of the first group involving rehabilitation and upgrading. This EMP will contain a separate Appendix for each PLN project office to include the office-specific details: (i) the responsibilities regarding implementation of the Project as applicable to that particular office (in light of the fact that each office has different responsibilities with respect to PLN Headquarters); (ii) the list of projects and project details and (iii) budgets and capacity building. An individual EMP will be prepared for each new subproject in the first group and any project identified and defined prior to appraisal in the second group. 5. LARAPs for all subprojects that involve land acquisition in the first group and any project identified and defined prior to appraisal in the second group will be prepared and appraised during project preparation. 6. EMPs for all subprojects in the second group will be prepared and appraised as required during project implementation in accordance with the ESMF. 7. LARAPs for all subprojects that involve land acquisition in the second group will be prepared and appraised during project implementation in accordance with the LARAF. 8. Due diligence will be carried out for new and extension subprojects for which land has already been acquired by PLN in anticipation 1 Reminder: The Bank's Disclosure Policy requires that safeguard-related documents be disclosed before appraisal (i) at the InfoShop and (ii) in country, at publicly accessible locations and in a form and language that are accessible to potentially affected persons. of the construction of a new sub-station/expansion of the existing substation. The due diligence will identify the timing and procedure according to which PLN obtained the land. The due diligence and protocol needs to ensure the use of independent land assessors to help establish the market price. 9. An Indigenous People Development Plan (IPDP) for those subprojects in the second group that trigger the Indigenous People Policy will be prepared and appraised during project implementation in accordance with IPPF. 10. There would be two levels of consultations. First consultation will be held on the #supplementary# EMP (for rehabilitation and expansion). The Project will use an approach called #decentralized open house# at each branch of the regional project office, given the fact Public Disclosure Copy that each office covers large territorial areas in more than one island. It involves newspaper and internet announcements of where to view full copies of the safeguard instruments, with a date and time for an open house (specify which local offices), where those with any questions, comments or concerns can have their say. Second consultation will be held at or near the site for new substations for sub-project-specific issues. 11. All three frameworks (ESMF, LARAF and IPPF), the EMPs and LARAPs of the first group subprojects and any subproject identified and defined prior to appraisal in the second group will be prepared and submitted to the Bank in December 2011. IV. APPROVALS Signed and submitted by: Task Team Leader: Name: Anh Nguyet Pham Date: 21-Nov-2011 Approved By: Regional Safeguards Coordinator: Name: John R. Butler (RSA) Date: 01-Dec-2011 Comments: Sector Manager: Name: Franz R. Drees-Gross (SM) Date: 23-Nov-2011 Comments: Approved. Public Disclosure Copy