Summary Environmental Impact Assessment Project Number: 42117 April 2008

People’s Republic of China: Tianjin Integrated Gasification Combined Cycle Power Plant Project

Environmental Assessment Report

Prepared by [Author(s)]

[Firm]

[City, Country]

Prepared for [Executing Agency] [Implementing Agency]

Prepared by the Huaneng Greengen Co. for the Asian Development Bank (ADB).

The summary environmental impact assessment is a document of the borrower. The views expressed herein do not necessarily represent those of ADB’s Board of Directors, Management, or staff, and may be preliminary in nature.

CURRENCY EQUIVALENTS

(as of 27 February 2008)

Currency Unit – yuan (CNY) CNY1.00 = $0.139

$1.00 = CNY7.2

ABBREVIATIONS ADB – Asian Development Bank BOD – biochemical oxygen demand DO – dissolved oxygen EIA – environmental impact assessment EMP – environmental management plan EMU – environment management unit EPB – environmental protection bureau FGD – flue gas desulfurization gce – grams coal equivalent HGC – Huaneng Greengen Co. IA – implementing agency IGCC – integrated gasification combined cycle PRC – People’s Republic of China SEIA – summary environmental impact assessment TSP – total suspended particulates TPH – total petroleum hydrocarbons

WEIGHTS AND MEASURES C – Celsius ha – hectare g/kWh – grams per kilowatt-hour kg – kilogram km – kilometer kV – kilovolt kWh – kilowatt-hour m – meter m3 – cubic meter m3/h – cubic meters per hour mg/L – milligrams per liter mm – millimeter MW – megawatt s – second t – ton t/a – tons per annum t/d – tons per day

NOTE

In this report, "$" refers to US dollars.

CONTENTS

Page

MAPS

I. INTRODUCTION 1 II. DESCRIPTION OF THE PROJECT 1 III. DESCRIPTION OF THE ENVIRONMENT 2

A. Physical Environment 2 B. Biological Environment 6 C. Sociocultural Environment 6

IV. ALTERNATIVES 7 V. ANTICIPATED ENVIRONMENTAL IMPACTS AND MITIGATION MEASURES 8

A. Soil 8 B. Water 9 C. Air Quality 9 D. Noise 11 E. Solid Waste and Hazardous Materials 12 F. Flora and Fauna 13 G. Sociocultural Environment 13 H. Induced Impacts 13

VI. ECONOMIC ASSESSMENT 14 A. Environmental Costs 14 B. Environmental Benefits 14

VII. ENVIRONMENTAL MANAGEMENT AND ENVIRONMENTAL MONITORING PLAN 15 VIII. PUBLIC CONSULTATION AND INFORMATION DISCLOSURE 17

A. Stakeholder Consultation before the Environmental Impact Assessment 17 B. Stakeholder Consultation after the Environmental Impact Assessment 19

IX. CONCLUSION 20 APPENDIX

Summary Environmental Management Plan 21

PROJECT LOCATION

B o h a i B a y

TIANJIN

Beitang

Ninghe

Baodi

Ji Xian

Wuqing

Dongli

Jinghai

Hangu

Chengguantun

Xiaozhan

Dagu

Tanggu

Shuangkou

Dabaizhuang

Dashahe

Baijian

Bieshan

Hongshuizhuang

Mashenqiao

Binhaicun

Taiping

Shanggulin

Panzhuang

Xiditou

Chandian

Jiangwakou

Huangzhuang

Lintingkou

CuihuangkouJiuwuqing

Damengzhuang

Sangzi

Youguzhuang

Huangyanguan

Fengtai

HEBEI

BEIJING

BEIJING

HEBEI

HEBEI

HEBEI

Provincial Capital

City/Town

Other Town

Expressway

National Highway

Other Road

Railway

River

Provincial Boundary

Boundaries are not necessarily authoritative.

TIANJIN INTEGRATED GASIFICATIONCOMBINED CYCLE POWER PLANT PROJECT

IN THEPEOPLE'S REPUBLIC OF CHINA

0 8 16 24 32

Kilometers

N

08-0416a HR

Map 1

118 00'Eo

118 00'Eo

116 00'Eo

116 00'Eo

41 00'No

41 00'No

o38 30'N

o38 30'N

B o h a i B a y

River

Haihe

TANGGUDISTRICT

DAGU CANNON STATION

CARGO DISTRIBUTION CENTER

PROJECT SITE

TANGGU AIRPORT

PASSENGER CENTER

HARBOR INDUSTRIAL PARK

TIANJIN INTEGRATED GASIFICATIONCOMBINED CYCLE POWER PLANT PROJECT

IN THEPEOPLE'S REPUBLIC OF CHINA

0 0.5 1 2

Kilometers

N

08-0416b HR

Map 2

.

I. INTRODUCTION 1. This summary environmental impact assessment (SEIA) presents the assessment of environmental issues relating to the development of the Tianjin Integrated Gasification Combined Cycle (IGCC) Power Plant Project (the Project), located in the Harbor Industrial Park, Tanggu District, Tianjin, in the People’s Republic of China (PRC). The SEIA was prepared in accordance with the Environmental Assessment Guidelines (2003) and Environment Policy (2002) of the Asian Development Bank (ADB). The Project is classified as category A in accordance with ADB environmental classification criteria. The Project is the first operational scale IGCC project to be developed in the PRC. The total cost of the Project is approximately $300 million. ADB is considering providing financing of $200 million. The Project is anticipated to take 4 years to complete. 2. The SEIA is based on the following documents:

(i) Huaneng Greengen Tianjin IGCC Environmental Impact Assessment (EIA) Report, May 2007, (project EIA) prepared by the Tianjin Environment Protection Research Institute. The EIA report was approved by the State Environmental Protection Administration in July 2007.

(ii) Huaneng Greengen Tianjin IGCC Project Feasibility Study Report, completed by

the China Electric Power Engineering Advisor Group Northwest Electric Power Design Institute, Xi’an Thermal Power Research Institute and Wuhuan Technology Co., in January 2007.

II. DESCRIPTION OF THE PROJECT

3. The Project is to develop a 250 megawatt (MW) IGCC power plant and a research center to further research polygeneration options, especially pilot testing of hydrogen production and fuel cell power generation. The Project is located in Harbor Industrial Park, Tanggu District, Tianjin, PRC, as shown on maps 1 and 2. Construction of the industrial park commenced in June 2006 and is expected to be completed in 2020. The Harbor Industrial Park Environmental Impact Assessment (EIA 1 was completed by Tianjin Environmental Protection Research Institute in 2006. The proposed 250 MW Project will be the first IGCC demonstration project in the PRC. The IGCC Project will supply baseload electricity to the local grid and will supply steam and heat to facilities within the Harbor Industrial Park. The Project will provide annual electricity generation of 1.5 billion kilowatt-hours (kWh). It will occupy 20 hectares (ha) of land newly reclaimed from the Bohai Sea. The Project will include construction of the following:

(i) coal gasifier with a processing capacity of 2,000 tons per day (t/d) (The coal gasifier used is a two-stage dry pulverized coal gasifier. The production process includes coal grinding and drying, pulverized coal compression and feeding, coal gasification, slag removal, dust removal, wet scrubbing, ash flushing water treatment, and wastewater treatment);

(ii) gas turbine and steam turbine combined cycle, consisting of one 171 MW gas

turbine, one 110 MW steam turbine, and waste heat boiler;

1 Tianjin Environmental Protection Research Institute. 2006. Environmental Impact Assessment Report of Land

Reclamation Project. Tianjin.

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(iii) syngas purification system, with a processing capacity of 160,739 m3/h; (iv) sulfur recovery system (the Shell-Paques biological desulfurization process is

used to remove hydrogen sulfide [H2S] in the raw gas, with a sulfur recovery capacity of 8.27 t/d);

(v) flaring system (in case of operation failure, syngas can be flared; the torch 80

meters [m] high and 900 millimeters [mm] in diameter);

(vi) other items including an air-separation facility with a capacity of 43,497 cubic meters per hour (m3/h), water supply, power supply, ash removal system, wastewater treatment and discharge system, water-recycling system, boiler water supply system, and fire water system;

(vii) storage and transport system, including coal transport, storage and distribution

system, emergency ash yard, on-site temporary solid waste yard, oil tank, and oil pump room;

(viii) temporary workers’ accommodation; and

(ix) permanent office and residential building.

III. DESCRIPTION OF THE ENVIRONMENT

A. Physical Environment 4. Topography. The Project is in Tanggu District, Tianjin, where the general elevation is less than 20 m above sea level. The land occupied by the Project is newly reclaimed. The beach slope in the vicinity of the reclamation area is very gentle (1/1000–1/2000), and the exposed tidal flats are expansive at low tide. 5. Geology and Soils. The project site is in the Huanghua Depression. The regional fault structure is well developed, and there are several main faults in the vicinity of the project site, with the nearest being about 2 kilometers (km) from the project site. At the project site the surface Quaternary sediments exceed 60 m in depth. The soils of the reclaimed site have been dredged from nearby shipping channels in the Haihe River. The underlying in-situ soils and the newly placed dredged soils consist of varying mixtures of clay, silt, and fine sand. The ground level in the project area is 0.5–0.8 m above sea level. The area is protected by a seawall running the length of the reclaimed area. The water table at the site is relatively shallow. Some secondary settlement is anticipated at the site as the dredged soils consolidate. Surface topsoil 0.2–0.5 m deep will be placed on the site for landscaping when construction is completed. 6. Analysis of surface soil quality at the site found soils classified as class III in accordance with GB15618-1995, with the exception of cadmium. Class III is the lowest level of soil classification under GB15618-1995 and indicates that the soil is not suitable for agriculture. The soil analysis data is presented in Table 1.

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Table 1: Soil Quality Monitoring at Project Site, January 2006 (mg/kg) Sampling Depth Cu Pb Cd Zn Cr Ni Hg As 0.0–0.2 m 99.60 15.65 1.71 89.58 88.75 58.33 0.02 7.53 1.0 m 68.03 14.78 1.80 88.47 67.00 39.17 0.03 7.82 2.0 m 69.87 13.91 1.80 82.15 77.25 43.12 0.03 6.91 2.5 m 234.87 11.30 1.39 53.10 41.50 197.92 0.02 6.35 Class III Standard 400.00 500.00 1.00 500.00 300.00 200.00 1.50 40.00

As = arsenic, Cu = copper, Cd = cadmium, Cr = chromium, Hg = mercury, kg = kilogram, m = meter, mg = milligram, Ni = nickel, Pb = lead, Zn = zinc. Source: Tianjin Environmental Research Institute. 2007. Huaneng Greengen Tianjin IGCC Project Environmental Impact Assessment Report. Tianjin. 7. Climate. Tianjin has a semi-wet terrestrial monsoon climate. It has a dry winter that lasts for 156–167 days, a short spring lasting 50–61 days, a long wet summer of 87–103 days, and a relatively dry autumn. The annual rainfall in Tanggu District is about 566 mm, mainly occurring in July and August. The average annual evaporation in the project area is 1,910 mm. The prevailing wind direction is southwest in the spring, southeast in the summer, southwest in the autumn and northwest in the winter. The annual prevailing wind direction is southwest. Strong winds often occur in April, with an average wind speed at 5.3 meters per second. The annual average wind speed is 4.3 meters per second. The annual average temperature is 12.6oC, with an absolute maximum of 40.9oC and minimum of –15.4oC. 8. Air Quality. The average baseline air quality in Tanggu District, Tianjin, is class III (GB3095-1996) with a target of class II. In 2006, based on the air monitoring results of Tanggu District by a local environmental monitoring station, the average sulfur dioxide (SO2) and particulate matter below 10 microns in diameter (PM10) exceeded the class II standard for ambient air quality. Class II compliance reportedly occurs for 82.1% of the year.

Table 2: Air Quality in Tanggu District, Tianjin, 2003–2006 (mg/m3)

Item SO2 NO2 PM10 CO 2006 Average 0.07 0.055 0.11 2.4 2005 Average 0.05 0.033 0.01 1.2 2004 Average 0.05 0.035 0.11 1.8 2003 Average 0.04 0.038 0.11 3.0 Class II Standard 0.06 0.080 0.10 4.0 Class III Standard 0.10 0.120 0.15 6.0 WB PPAHa Moderate Quality

0.08

0.10

0.05

WB PPAHa Poor Quality 0.10 0.15 0.10 CO = carbon monoxide; m3 = cubic meter; mg = milligram; NO2 = nitrogen dioxide; S02 = sulfur dioxide; PM10 = particulate matter below 10 microns. Source: Tianjin Environmental Research Institute. 2007. Huaneng Greengen Tianjin IGCC Project Environmental Impact Assessment Report. Tianjin. a World Bank Group. 1998. Pollution Prevention and Abatement Handbook. Washington, DC.

9. Between 29 January 2007 and 2 February 2007, air quality was monitored at six sites in the areas surrounding the project site. Five samples were taken at each point for each day. The monitoring results, shown in Table 3, indicate that only carbon monoxide (CO) reached class II air quality standard, with nitrogen dioxide (NO2), SO2, PM10 and total suspended particulates (TSP) exceeding the class II standard. High SO2 levels are mainly due to coal combustion during the heating period. Elevated PM10 and TSP are mainly dust raised by strong winds in the winter from sparse vegetation and bare land, including dust from nearby construction.

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Table 3: Air Quality Index Statistics Monitoring Point SO2 NO2 PM10 TSP CO Bohai Petroleum Street 0.953 0.450 3.307 0.425 Dagu Street (planned residential area for central business district)

0.084 0.500 4.653 0.500

Tianjin Port Passenger Terminal 1.060 0.883 4.613 0.575 Bulk Material Logistics Center‘s Trade Area

1.620 0.883 3.140 0.675

Tanggu Environmental Protection Bureau 1.280 1.040 0.667 0.775 Power Plant Site 1.167 0.733 3.486 3.020 0.450

Note: The assessment index equals the measured value divided by class II standard value. CO = carbon monoxide; NO2 = nitrogen dioxide; S02 = sulfur dioxide; PM10 = particulate matter below 10 microns in diameter; TSP = total suspended particulates. Source: Tianjin Environmental Research Institute. 2007. Huaneng Greengen Tianjin IGCC Project Environmental Impact Assessment Report. Tianjin.

10. Water Resources. The Dagu Wastewater Canal is the main wastewater canal in Tianjin and has been operating for more than 40 years. The canal accepts industrial and residential wastewater and discharges both treated and untreated wastewater into the Bohai Sea. The water quality monitoring results from the Dagu Wastewater Canal, presented in Table 4, show that ammonia nitrogen (NH3-N), dissolved oxygen (DO), biochemical oxygen demand (BOD), potassium permanganate index, and volatile phenol exceed the class V standard for surface water quality (GB3838-2002). Class V is the lowest level and indicates poor water quality.

Table 4: Water Quality Monitoring Results Dongdagu Pump Station at the Dagu Wastewater Canal

Year

DO

(mg/L)

PM index

BOD

(mg/L)

NH3-N (mg/L)

Total Hg

(µg/L)

Total Cd

(µg/L)

Total Pb

(µg/L)

Volatile Phenol (mg/L)

2004 0.1 16.2–45.3 37.6–137 21.4–41.9 0.12–0.84 0.2–1.0 1.0–22.0 0.074–0.154 2005 0.1 12.4–74.2 29.9–122 22.9–65.0 0.07–2.07 0.1–0.6 1.9–10.9 0.126–0.638 2006 0.1–1.9 22.7–55.8 15.6–68.4 23.8–38.5 0.06–0.47 0.02–

0.36 1.1–4. 8 0.022–0.446

Class V ≥2 ≤15 ≤10 ≤2.0 ≤1 ≤10 ≤100 ≤0.1 BOD = biochemical oxygen demand (5 day), Cd = cadmium, DO = dissolved oxygen, N = nitrogen, NH3 = ammonia, Hg = mercury, mg/L = milligrams per liter, Pb = lead, PM = potassium permanganate, µg/L = micro grams per liter. Source: Tianjin Environmental Monitoring Center.

11. The Project is located in the Harbor Industrial Park, which is directly adjacent to the Bohai Sea. The quality of the seawater next to the Harbor Industrial Park is required to meet class III and class IV of the Standard of Seawater Quality (GB3097-1997), depending on the relevant location. Based on monitoring results, the seawater quality in the designated class IV area does not meet class IV standard, with the main pollutants being ammonia, inorganic nitrogen, and active phosphate. In the class III area, the seawater reaches the class III standard for seawater quality, with the exception of inorganic nitrogen. The water quality monitoring results are shown in Table 5.

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Table 5: Near-shore Seawater Quality Monitoring Results Parameter

(mg/L) 2004 2005 2006 2004 2005 2006 2004 2005 2006 2004 2005 2006 III VIpH 7.8 8.1 8.1 7.9 8.1 8.2 7.9 8.2 8.3 8 8.1 8.3

COD 1.31 1.00 1.32 1.59 1.44 3.20 1.12 1.35 3.39 0.87 0.92 3.84 ≤4 ≤5DO 7.67 6.73 4.40 8.40 7.14 6.37 8.18 7.69 7.47 7.40 7.54 7.54 >4 >3NH3 0.010 0.008 0.026 0.025 0.038 0.062 0.015 0.033 0.006 0.008 0.004 0.010

N Inorg 3.12 0.63 1.46 4.36 1.02 1.05 3.84 0.94 0.29 2.68 0.34 0.62 ≤ .40 ≤ .50Oil 0.01 0.07 0.02 0.03 0.04 0.06 0.02 0.06 0.02 0.12 0.04 0.02 ≤ .30 ≤ .50Hg 0.050 0.020 0.020 0.067 0.027 0.020 0.053 0.053 0.027 0.027 0.040 0.020 ≤0.200 ≤0.500Cu 3.93 4.07 6.20 4.27 5.37 5.60 3.53 3.37 8.03 4.53 3.50 7.53 ≤50 ≤50Pb 9.92 1.63 1.55 7.46 2.05 2.03 13.73 3.32 1.26 7.29 2.76 0.59 ≤10 ≤50Cd 0.42 0.16 0.18 0.35 0.12 0.14 0.43 0.13 0.14 0.34 0.17 0.15 ≤10 ≤10As 1.90 2.20 1.30 2.06 2.77 1.69 1.48 2.47 1.37 1.65 1.77 1.52 ≤50 ≤50

Phosphate 0.040 0.025 0.018 0.022 0.023 0.028 0.021 0.035 0.013 0.015 0.013 0.011 ≤ .030 ≤ .045Standard

5# 6# 7#

Class IV Class IV Class IV Class III

8# Class*

6.8-8.8

≤0.020

As = arsenic, Cd = cadmium, COD = chemical oxygen demand, Cu = copper, DO = dissolved oxygen, Hg = mercury, Inorg = Inorganic , mg/L = milligrams per liter, N = nitrogen, NH3 = ammonia, Pb = lead, pH = acidity measure. a Standard of Seawater Quality (GB3097-1997). Note: Sampling locations from 5# to 8# are located in the Bohai Sea adjacent to the Harbor Industrial Park. Source: Tianjin Environmental Monitoring Center. 12. The groundwater at the site is saline from the surface to approximately 115 m in depth. The saline layer is underlain by fresh groundwater below 115 m. The groundwater quality in the project site falls into class V (GB/T14848-93). Class V is the lowest grade of groundwater quality and indicates that it cannot be used for drinking purposes even after treatment and is not suitable for industrial or agricultural purposes. Monitoring results from shallow groundwater samples are shown in Table 6.

Table 6: Groundwater Monitoring Results, January 2006 Item

Monitoring Results (mg/L)

Class V GB/T14848-93 (mg/L)

pH 7.32 5.5–9 Total Dissolved Solids 47,100 >2,000 Chloride 18,100 >350 Nitrate (as N) 0.080 >30 Nitrite (as N) 0.034 >0.100 Fluoride 0.820 >2.000 NH3-N 12.030 >0.500 Cyanide 0.007 >0.100 Cr6+ 0.004 >0.100 Hg 0.040 >0.001 As 2.700 >0.050 Pb 0.400 >0.100 Cd 0.050 >0.010 Ni 0.030 >0.100 Cu 0.050 >1.500 Zn 0.060 >5.000 As = arsenic, Cr = chromium, Cu = copper, Hg = mercury, Cd = Cadmium, mg/L = micrograms per liter, N = nitrogen, NH3-N = ammonia, Ni = Nickel, Pb = Lead, pH= acidity measure, Zn = zinc. Source: Tianjin Environmental Protection Research Institute. 2006. Environmental Impact Assessment Report of Land Reclamation Project. Tianjin.

13. Noise. The Project is located in the Harbor Industrial Park, which has no permanent residents. Facilities adjacent to the project site include the Tianjin Alkali Plant and a desalinization plant. The industrial park is relatively new and mostly vacant. The nearest residential area is about 5 km away from the project site. Preconstruction noise was monitored between 31 January 2007 and 1 February 2007 at four points adjacent to the project site. These monitoring results, presented in Table 7, indicate conformance with class III standard for Industrial Enterprise Boundary (GB12348-90), indicating low background noise levels.

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Table 7: Noise Level in the IGCC Project Area Monitoring Points Time Decibel Acoustic

Day 54.6 31 January 2007 Night 45.9 Day 57.2

1 m outside the east boundary 1 February 2007 Night 47.7

Day 53.8 31 January 2007 Night 46.0 Day 54.0

1 m outside the south boundary 1 February 2007 Night 47.4

Day 56.6 31 January 2007 Night 47.0 Day 55.0

1 m outside the west boundary 1 February 2007 Night 46.9

Day 54.2 31 January 2007 Night 48.2 Day 50.6

1 m outside the north boundary 1 February 2007 Night 46.9

Day 65.0 Class III (GB3096-93)a Night 55.0

IGCC = integrated gasification combined cycle, m = meter. a Class III (GB3096-93) standard relates to industrial areas. Source: Tianjin Environmental Protection Research Institute. 2007. Huaneng Greengen Tianjin IGCC Project Environmental Impact Assessment Report. Tianjin.

B. Biological Environment 14. Terrestrial Flora and Fauna. The project site is located on land reclaimed from the Bohai Sea and therefore has no natural ecosystems to support native flora and fauna. Due to close proximity to the sea and the surface soils being predominantly dredged, surface soils are saline. No trees, shrubs, or grass grow on the project site. Topsoil will be imported to the site for landscaping upon completion of construction. In the coastal area near the Harbor Industrial Park, the main terrestrial flora are weed meadow and halophyte vegetation. The weed meadow is dominated by reed weed, pi weed and dog-tail weed, and the halophyte vegetation is dominated by Suaedaa glauca. A survey conducted in 1997–2000, prior to construction of the Harbor Industrial Park, recorded 107 kinds of birds in the project area, of which 103, or 96%, were migratory. The bird individuals are mostly pigeon (41%) and wild goose (31%). 15. Aquatic Flora and Fauna. The aquatic flora adjacent to the Harbor Industrial Park includes (i) reeds and cattail in the tidal area; (ii) pricking weed, bitter weed, golden fish algae and daci algae on the shallow seafloor; and (iii) duckweed and purple back duckweed in shallow areas. C. Sociocultural Environment 16. Industrial Park Development. The Harbor Industrial Park is about 10 km from central Tanggu District, and 50 km to Tianjin. It is about 5.5 km long and 4.12 km wide. The first stage development of the industrial park will cover an area of 22 square kilometers (km2), and final development will cover 80 km2. For the first stage, plans are to construct a 1 million ton per annum ethane project, a 10 million ton per annum oil refining project, a large chloride alkali project, and other chemical sector projects. 17. Local Population and Economy. Tanggu District of Tianjin covers an area of 859 km2 and has a total population of 0.49 million, including 0.43 million urban residents. The district has

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8 towns and 14 county administrations. The total output of the district was CNY8.98 billion in 2005, increasing by 20.7% on the previous year. The farmers’ average per capita net revenue was CNY6,555 in 2005, compared with the national average of CNY3,255. 18. Local Resources. Tanggu District has rich oceanic chemical resources. The salt content of its seawater is 3.5%, which is suitable for producing salt and extracting more than 90 chemical raw materials such as potassium, lithium, and argon. The Bohai Sea covers rich oil and natural gas resources, with the Bohai oilfield being the first offshore oil and gas field in the PRC. The area includes deep geothermal resources. The temperature of the geothermal water is 65°C to 78°C. 19. Cultural Sites. There are no cultural, archaeological, or historical sites in the vicinity of the site. The nearest cultural site is the 200-year-old Dagu Cannon Station located approximately 6 km away.

IV. ALTERNATIVES

20. Do-Nothing Option. Under the do-nothing alternative, the continued increase in the baseload demand for the grid would result in power outages and load shedding. Without this Project, standard coal-fired boilers would have to be constructed to supply heat and steam to the projects in the industrial park, which could increase the environmental pollution in the project area. The do-nothing alternative also neglects the enormous potential benefits available from IGCC technology to the PRC energy sector. 21. Alternative Energy Supplies. The Project can be replaced by a conventional coal-fired power plant of 300 MW. Increasing the conventional coal-fired generation capacity would cause significant environmental harm from increased emissions. Comparison results of the IGCC Project (option I), a conventional coal-fired power plant (option II), and a supercritical coal-fired power plant (option III) are shown in Table 8. Option I is preferred, as Tianjin has strict total emission limits on SO2 and particulate matter. A 300 MW conventional coal-fired power plant would utilize approximately 493,100 tons coal equivalent annually, compared with the proposed IGCC plant’s annual consumption of approximately 443,223 tons coal equivalent. Other alternative energy supplies in Tianjin for power generation include renewable energy resources, oil, and gas. Currently, alternative renewable energy supplies such as wind, solar, and biogas cannot compete commercially with baseload coal-fired power generation. Oil and gas for power generation are currently uneconomical compared with coal-fired power generation.

Table 8: Comparison of Power Generation Options

Evaluation Criteria

Option I

(IGCC power plant)

Option II with FGD (Conventional coal-fired

power plant)

Option III with FGD (Supercritical coal-fired

power plant)

Preferred

Option SO2 emission (g/kWh)

0.13 0.78 0.72 I

NOx emission (g/kWh)

0.07 2.08 1.93 I

TSP (g/kWh) 0.01 0.03 0.03 I CO (g/kWh) 0.01 0.13 0.12 I Environmental Impact from project operation

Less emission of SO2, slag, dust, and CO2. The SO2 removal efficiency is greater than 98%.

More emission of SO2, slag, dust, and CO2. The SO2 removal efficiency is greater than 90%.

More emission of SO2, slag, dust, and CO2. I

Energy efficiency (electricity

254 gce/kWh 321 gce/kWh 271 gce/kWh I

8

Evaluation Criteria

Option I

(IGCC power plant)

Option II with FGD (Conventional coal-fired

power plant)

Option III with FGD (Supercritical coal-fired

power plant)

Preferred

Option supplied) Construction Conditions

More construction and high requirement for construction management

Less construction and normal requirement of construction management

Less construction and marginally more management required II

Economic Indicators

More investment per unit at about CNY6950/kW; High electricity production cost of CNY0.30/kWh

Lower investment per unit at about CNY5,000/kW; lower electricity production cost of CNY0.20/kWh

Lower investment per unit investment at about CNY5,500/kWh; lower electricity production cost of CNY0.20/kWh

III

Operational Management

Operational management is complex

Less complex management

Less complex management III

CO = carbon monoxide, CO2 = carbon dioxide, FGD = flue gas desulfurization, gce = grams coal equivalent, IGCC = integrated gasification combined cycle, g = gram, kWh = kilowatt hour, MW = megawatt, NOX = nitrogen oxide, SO2 = sulfur dioxide, TSP = total suspended particulates. Sources: Williams, Robert H. 2001. Development of China’s coal utilization technology toward zero emission. Princeton: Princeton Environmental Institute; and Tianjin Environmental Protection Research Institute. 2007. Huaneng Greengen Tianjin IGCC Project Environmental Impact Assessment Report. Tianjin.

V. ANTICIPATED ENVIRONMENTAL IMPACTS AND MITIGATION MEASURES A. Soil 22. Construction Period. Potential impacts to soil during the construction period include (i) erosion of recently dredged soils, (ii) contamination from spillage of hydrocarbons and other hazardous wastes, (iii) impact from construction traffic, and (iv) disposal of construction spoil. The surface of the site may be particularly prone to water and wind erosion as it consists largely of uncompacted, recently dredged soils. 23. Mitigation measures will include (i) laying compacted topsoil and re-vegetating exposed surfaces as quickly as possible after construction at each area is completed, (ii) installing sediment fences for temporary soil stockpiles, and (iii) allowing sediment to settle in sedimentation ponds and storm water channels prior to discharge into the Bohai Sea. Soil contamination will be prevented by (i) installing oil separators at wash-down and refueling areas and (ii) installing appropriate storage facilities for hazardous wastes and hydrocarbons on site, including secondary containment at fuel storage sites. All septic waste will be collected and removed from the site. Spill cleanup equipment will be provided at each construction site, and training will be conducted regarding response procedures for emergency spills. All hazardous and other waste will be removed from the site to approved waste disposal sites. There will be no on-site landfill. Impact to soil from construction traffic will be minimized by confining traffic to predetermined roads. Spoil generated from construction activities will be stockpiled, dewatered, and used for landscaping where possible or removed from the site to approved disposal areas. Sediment fences will be installed around temporary spoil stockpiles to control erosion runoff. 24. Operational Period. The potential impact on soil during the operational period will include (i) soil erosion from exposed areas and (ii) soil contamination. Soil erosion from exposed areas will be mitigated by ensuring that exposed areas are compacted and re-vegetated where possible. Soil contamination will be prevented by installing oil separators at wash-down and refueling areas and installing secondary containment at fuel storage sites. All hazardous wastes and hazardous materials will be stored in properly designed storage facilities.

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B. Water 25. Construction Phase. Potential impacts to water resources during the construction phase include (i) disposal of septic wastewater generated by construction workers, (ii) disposal of equipment wash-down water, and (iii) impacts on water reserves from over extraction. Septic wastewater generated during construction will be collected, treated in on-site facilities, and either disposed of in the industrial park wastewater treatment facilities or recycled on site. There will be no on-site septic seepage disposal system, and no direct discharge of sanitary waste will be made to surface water bodies. All equipment wash-down areas will include oil separators. Industrial and potable water for the Project will be supplied by the industrial park desalinization plant and the municipal water system. The Project will not use groundwater from the site. 26. Operational Phase. The main potential impact to water resources during construction is the disposal of operational wastewater. Proposed wastewater disposal methods are presented in Table 9.

Table 9: Wastewater Disposal Type

Generation (m3/h)

Disposal

Recycling system and cooling tower wastewater

73.79

Chemical water treatment and boiler-operation wastewater Coal-gasification wastewater Sulfur-recovery system wastewater

21.20

Disposed of at the site wastewater treatment plant and then at the Harbor Industrial Park wastewater treatment plant

Air-separation system wastewater 135 Recycled as make-up water for cooling tower Other industrial wastewater 20 Collected and treated on site (air flotation) and then

reused as make-up water for cooling recycling water Residential wastewater 8 Treated on site by two-stage biological contact oxidation

method and reused on site m3/h = cubic meters per hour. Source: Tianjin Environmental Protection Research Institute. 2007. Huaneng Greengen Tianjin IGCC Project Environmental Impact Assessment Report. Tianjin.

27. The wastewater released off site to the Harbor Industrial Park wastewater treatment plant will be treated to class II standard of wastewater discharge (GB8978-1996). Wastewater from the coal-gasification system will be treated to remove NH3-N and cyanide. The temperature of the wastewater released from the site will be close to ambient temperature. The Harbor Industrial Park wastewater treatment plant has a capacity of 30,000 t/d (first stage), which is sufficient to accommodate project wastewater (2,388 t/d) and all existing infrastructure in the industrial park. Further capacity increase is designed into the industrial park expansion plans. C. Air Quality 28. Construction Phase. The main impact to air quality during construction will be from increased dust levels from vehicle exhaust, construction machinery, foundation excavation, cement mixing, building construction, soil backfilling and minor access road construction. There are no residential areas in the vicinity of the Project, but there are a number of industrial facilities. Mitigation measures will include (i) paving all major access roads and using water trucks to suppress dust on unpaved roads, (ii) covering temporary soil stockpiles, (iii) limiting excavation during windy days exceeding grade 4, and (iv) forbidding construction workers to burn coal or firewood on site.

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29. Operational Phase. During the operational phase, potential impact to air quality will include (i) dust from the coal storage area, (ii) emissions from the pulverized coal system, (iii) dust from the coal transport system, and (iv) power plant emissions. Fugitive dust from the coal storage area will be mitigated by enclosing the coal stockpile and using water to suppress dust. Suppression of dust emissions from the pulverized coal system will include enclosing the operation, emission capture, and cyclone emission control. Mitigation for dust emissions from coal transportation include covering the coal transported to the site, washing vehicles, using water to suppress dust in the unloading area, spray systems, and enclosing conveyer belts. Ongoing air quality monitoring will ensure compliance with local air quality standards. Emission control from the IGCC power plant will consist of the following:

(i) Syngas purification. Cyclone emission control, wet scrubbing, and Shell-Paques biological desulfurization process for sulfur recovery. SO2 removal will achieve 99.8%.

(ii) Coal processing system. Bag dust collector, with dust removal efficiency of 99.9%.

(iii) NOx emissions. These will be controlled by using a low NOx burner and steam injection (100 tons per hour) before the syngas enters the gas turbine.

(iv) Mercury emissions. These will be controlled by selecting low-mercury Shenhua coal and using high dust removal techniques that achieve 90% mercury removal efficiency.

30. The following PRC emissions standards apply for the proposed Project: the air pollution emission standard for coal-fired power plants (GB13223-2003 class III) and the standard for comprehensive air pollution emission (GB16297-1996, class II). A comparison of PRC, World Bank, and design emission standards are presented in Table 10.

Table 10: Project Design Emission Data and Standards Parameter

Design Emissions from Gas Turbine

(mg/m3)

GB13223-2003a

(mg/m3)

GB16297-1996b Class II

(mg/m3)

World Bankc

(mg/m3) 4.8 400 550 2,000

SO2 0.055 t/d (normal operation)

0.88 t/d (maximum) 50 t/d

TSP 30 50 50 NOx 25 80 125d NO2 240

mg/m3 = milligrams per cubic meter, NO2 = nitrogen dioxide, NOx = nitrogen oxides, SO2 = sulfur dioxide, t/d = tons per day, TSP = total suspended particulates. a Air pollution emission standard for coal-fired power plants (GB13223-2003), emission limit for gas turbines. b Standard for comprehensive air pollution emission (GB16297-1996). c World Bank Group. 1998. Pollution Prevention and Abatement Handbook. Washington, DC. d Applicable to combustion turbine unit (dry at 5% oxygen). Source: Tianjin Environmental Protection Research Institute. 2007. Huaneng Greengen Tianjin IGCC Project Environmental Impact Assessment Report. Tianjin.

31. Dispersion modeling has been carried out in accordance with Guidelines for Environmental Impact Analysis—Air Environment (HJ/T2.2-93) and is based on data from the Tanggu climate station. The dispersion modeling indicates that the maximum additional annual concentration of SO2 and NO2 does not increase the classification of air quality to “moderate quality.”2 The dispersion modeling indicates that maximum additional annual concentration for

2 World Bank Group. 1998. Pollution Prevention and Abatement Handbook. Washington, DC.

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PM10 is equivalent to a 1% increase of the “moderate quality” standard. Dispersion modeling results for stack emissions indicated relatively minor increases in pollution in surrounding areas, as summarized below:

Table 11: Summary Dispersion Modeling Results

Parameter SO2

(µg/m3) NO2

(µg/m3) PM10

(µg/m3) H2S

(µg/m3) Maximum additional hourly concentration 5.63 20.07 - 8.28 Maximum additional daily concentration 2.31 10.23 0. 71 1.54 Maximum additional long-term concentration (heating period) 3.12 9.52 0. 72 1.01

Maximum additional long-term concentration (non-heating period) 1.46 7.58 0. 51 1.60

Maximum additional annual concentration 1.42 5.97 0. 51 1.37 Tunggu District 2006 average 71.00 55.00 110.00 Class II standarda (annual average) 60.00 80.00 100.00 Class III standardb (annual average) 100.00 120.00 150.00 WB PPAHb moderate quality (annual average) 80.00 100.00 50.00 WB PPAHb poor quality (annual average) 100 150 100

H2S = hydrogen sulfide, NO2 = nitrogen dioxide, PM10 = particulate matter below 10 microns. SO2 = sulfur dioxide, µg/m3 = micro grams per cubic meter.

a Ambient Air Quality Standard of China (GB3095-1996). b World Bank Group. 1998. Pollution Prevention and Abatement Handbook. Washington, DC. Source: Tianjin Environmental Protection Research Institute. 2007. Huaneng Greengen Tianjin IGCC Project Environmental Impact Assessment Report. Tianjin.

32. According to World Bank standards (see footnote 2), the baseline air quality (Table 2) in Tanggu is of “poor quality.” The proposed IGCC plant will annually emit about 20 tons of TSP. The project owner will offset this emission by retrofitting flue gas desulfurization (FGD) equipment at the Yangliuqing Thermal Power Plant, which is located about 60 km away from the IGCC Project site. The retrofitting will install FGD for two 300 MW coal-fired power-generating units, which will reduce TSP emissions from 326 tons per annum (t/a) to 163 t/a, which offsets emissions from the IGCC Project. D. Noise 33. Construction Phase. During construction, noise will be generated from vehicular movement, piling, sand and aggregate processing, concrete mixing, excavation machinery, and construction. As the residential area nearest to the site is about 5 km away, minimal impact on residential areas is anticipated. However, there are a number of construction sites near the project site with many construction workers. Equipment and machinery used for construction shall strictly conform to PRC and local noise standards. All equipment will be properly maintained to minimize noise. Noise emissions from the site will meet relevant national standards. Ongoing noise monitoring will be undertaken to ensure compliance. Mitigation measures during operation for noise impacts on workers will include standard occupational health and safety practices to relevant PRC standards. 34. Operational Phase. There are many noise sources during project operation, including gas turbines, steam turbines and ventilation cooling towers, pumps, and air compressors, but the noise sources will be located mainly in buildings, which will mitigate noise emissions. Noise mitigation measures will include enclosing the relevant equipment, noise suppression controls on relevant machinery, and siting particular facilities away from property boundaries. Ongoing noise monitoring will assess compliance with the requirements of noise standards at industrial facility boundaries (GB12348-1990). Mitigation measures during operation for noise impacts on

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workers will include standard occupational health and safety practices to relevant PRC standards. E. Solid Waste and Hazardous Materials 35. Construction Phase. Solid waste generated during construction will consist of residential rubbish and waste building materials. All residential rubbish and waste building materials will be collected, stored on site in appropriate storage facilities, and transported off site to approved disposal facilities. No on-site landfills will be developed. Impacts from the transportation and disposal of spoil may include spillage along access roads, causing hazards to vehicles, and increased dust or mud on access roads. Trucks used for the transportation of spoil will be covered, and any spillage will be cleaned up immediately. Hazardous waste generated during construction will be collected and stored separately on site in approved facilities. Hazardous waste will be removed from the site to approved hazardous waste disposal facilities by a licensed waste transportation company. 36. Operational Phase. A summary of the waste generated during the operational period and the disposal or recycling methods are summarized in Table 12.

Table 12: Waste Generation, Operation Phase Waste Type

Amount Generated

Disposal or End Use

Gasifier slag 57,878 t/a Recycled to construction industry Syngas ash 8,602 t/a Used as cement additive Sulfur (solid) 2,070 t/a Sold as raw material Wet scrubber waste 1 t/d Treated by local environmental

service company Waste coal 2,376 t/a Sold to building material company Waste activated carbon 15.7 m3/a Treated by local environmental

service company COS hydrolyzation agent 12 m3/a Treated by local environmental

service company Molecule sieve adsorbent 123 t/a Aluminum glue adsorbent 74 t/a

Supplier will be responsible for the treatment of the solid waste

m3/a = cubic meters per annum; t/a = tons per annum; t/d = tons per day. Source: Tianjin Environmental Protection Research Institute. 2007. Huaneng Greengen Tianjin IGCC Project Environmental Impact Assessment Report. Tianjin.

37. Hazardous waste generated during construction will be collected and stored separately on site in approved facilities. Hazardous waste will be removed from the site to approved hazardous waste disposal facilities by a licensed waste transportation company. The storage, collection, transportation, and disposal of hazardous wastes will be conducted in conformance with relevant PRC regulations. 38. To ensure disposal options for gasifier slag and syngas ash, the Executing Agency signed a letter of intent with (i) Tianjin Zhuyou Earthwork Engineering Co. on 4 December 2006 and (ii) Tianjin Defeng Fuels Sales Co. on 4 December 2006 to purchase 60,000 t/a of ash and 40,000 t/a of slag from the IGCC Project. The Project will construct a slag and ash handling area for short-term storage requirements and established a letter of commitment with Tianjin Yanliuqing Heat and Power Co. on 24 November 2006, located about 2.5 km from the Project, to allow usage of its emergency slag site measuring 2.3 million m3.

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39. A maximum of about 12,000 people work in the industrial park within 5 km of the project site. Within 5 km of the project site, there are no schools, hospitals, or environmentally protected areas such as drinking water protection areas, natural reserves, or habitats for rare aquatic life. The Project includes a number of high-temperature and high-pressure devices in the coal-gasification island, involving combustible, explosive, and poisonous materials. The hazardous materials include coal, sodium hydroxide solution, CO/H2 gas, CH4, H2S, and sulfur. The storage area has two 500 m3 diesel tanks. Potential risks include fire, explosion, and leakage of poisonous gases. CO/H2 gas is a class I (GB50160-92 flameproof standards for petrochemical enterprise design, GB18218-2000 identification of major risk sources, HJ/T169-2004 technical guidelines for environmental risk assessment of construction projects) combustible and explosive material, and diesel belongs to Class III. CO and H2S are class III poisonous materials. If a gas leak occurs, it is estimated that the pollutant would be concentrated mainly within 1,500 m of the leakage point. Potential fire hazards from leaked syngas will be mitigated by establishing a firefighting system with capacity for 3 hours of operation while industrial park firefighting resources are mobilized. Other risk mitigation measures include (i) work safety precautions with site selection and arrangement of buildings; (ii) safety measures at each stage of the production process, such as automatic cut-off valves; (iii) safety measures for electric and telecommunication devices; (iv) installing fire protection and fire alarm systems; (v) establishing a work safety responsibility system; (vi) specific safety measures for the diesel storage area; and (vii) establishing an emergency response system closely integrated into the local industrial park emergency response system. F. Flora and Fauna 40. As the Project is built on newly reclaimed land, there is no impact on natural vegetation. However, if construction and operation wastewater is not treated properly, it may affect aquatic flora and fauna in the Bohai Sea. Mitigation measures to protect water resources are described above. The Project is about 6 km away from the Haihe River, so there will be no impact on its aquatic flora and fauna. During project operation, areas of the project site will be landscaped and re-vegetated. G. Sociocultural Environment 41. Construction Period. The Project does not require any resettlement. All acquired land is government owned and newly reclaimed. During project construction, the peak number of workers may reach 10,000. Where possible, local labor will be used during construction. The influx of workers during construction may result in an increase in disease, particularly epidemical disease. Mitigation measures will include providing health education to workers and hygienic worker accommodation. 42. Operational Period. The Project will promote the economic development of Tianjin through the development of new coal-gasification technology, which is the key research and development project for the next generation of power-generation technology. The construction of the Project can relieve the undersupply of electricity in Tianjin and increase the stability of Jing-Jin-Tang power grid. The Project will create 300 new permanent jobs. H. Induced Impacts 43. The Project will have a number of positive induced impacts. These include (i) support for economic development in Tianjin through the provision of reliable energy supply for developing manufacturing, tourism, and raw material processing and (ii) the provision of heat and steam to

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other projects in the Harbor Industrial Park, which will bring energy savings and emission reduction. The successful development of IGCC demonstration projects and the subsequent scaling up will have a number of beneficial environmental impacts, including reduced emissions from coal-fired power plants, benefiting public health and controlling acid rain and greenhouse gas emissions. The Project includes the construction of a green generation technology research and development base, which may develop additional clean coal technologies. The Project will consider the capture of CO2 in the second stage, which would have significant global warming benefits.

VI. ECONOMIC ASSESSMENT A. Environmental Costs 44. The total project investment is CNY2.16 billion ($300 million). The total environmental investment of the Project is CNY88.25 million ($12.26 million), accounting for 4.1% of the total project investment. The environmental investment covers three waste-treatment facilities, an environmental monitoring station, accident precautions and emergency measures, and other facilities.

Table 13: Estimated Environmental Management Costs No. Item Costs (‘000 CNY) 1. Waste gas treatment and emission control facilities 20,300 2. Wastewater treatment facilities 9,250 3. Slag management facilities 4,000 4. Slag storage facilities 9,300

5 Environmental monitoring station, including environmental monitoring costs 6,750

6. Accident prevention and emergency measures, including waste storage facilities 6,150

7. Other facilities including coal bunker, noise control, erosion control, and vegetation 32,500

Total 88,250 ($12.26 million) Source: Tianjin Environmental Protection Research Institute. 2007. Huaneng Greengen Tianjin IGCC Project Environmental Impact Assessment. Tianjin.

B. Environmental Benefits 45. The PRC is the world’s largest coal producer and consumer. It has more than doubled its coal production in the past 5 years. In 2006, total coal production was 2.38 billion tons, up by 8% on 2005. Electricity generation is the largest coal user in the country, consuming about 55% of the coal produced in 2006. In 2006, electricity generation increased by 13.4% to 2,834 terawatt-hours, of which 83% was from burning coal, 14% from hydropower, 2% from nuclear, and less than 1% from wind and other alternative sources. Rapid growth in coal consumption in the PRC has caused major local and global environmental concerns. Two-thirds of PRC cities do not meet acceptable air quality standards, acid rain falls on one-third of the country, and the PRC is one of the largest emitters of greenhouse gases. Sustained growth projections and low per capita consumption will continue to drive up the demand for electricity. Improving energy efficiency and shifting to cleaner and non-carbon energy sources are essential to improve the country’s environment and help to mitigate global climate change. 46. The efficiency of new coal-fired power plants in the PRC is consistently improving. About 60% of new coal-based power plants (about 38 gigawatts) put into operation in 2005 were supercritical plants, and there were 16 ultra-supercritical plants of 1,000 MW each in operation

15

by the end 2007. However, the development of the IGCC power plant, which offers higher efficiencies, lower emissions, and the least-cost carbon capture-and-storage option, has been slow. So far, no industrial-scale IGCC plant is in operation in the PRC. 47. The Project will generate substantial positive environmental benefits through reduced air pollution compared with conventional coal-fired power generation. Avoided air pollution will have associated local, regional, and global benefits from reduced increases in particulate matter, sulfur dioxide, nitrogen oxides, carbon dioxide, and other air pollutants. Comparison data between IGCC and conventional power plants is presented in Table 14.

Table 14: Power Generation Technology Comparison Parameter

IGCC

Conventional

Supercritical

Ultra-Supercritical

Operating Parameters Thermal Efficiency 48% 38% 41% 45% Coal Consumption (gce/kWh supplied)

305 345 319 291

Coal Consumption (gce/kWh generated)

254 321 297 271

Emission Data TSP (g/kWh generated) 0.01 0.03 0.03 0.03 SO2 (g/kWh generated) 0.13 0.78 0.72 0.66 Slag (g/kWh generated) 44 108 100 91 CO2 (g/kWh generated) 676 854 790 721 NOx (g/kWh generated) 0.07 2.08 1.93 1.76 CO (g/kWh generated) 0.01 0.13 0.12 0.11

CO = carbon monoxide, CO2 = carbon dioxide, IGCC = integrated gasification combined cycle, g/kWh = grams per kilowatt hour, gce/kWh = grams coal equivalent per kilowatt hour, NOX = nitrogen oxide, SO2 = sulfur dioxide, TSP = total suspended particulates. Notes: The main base of the People’s Republic of China’s generation is subcritical. About half of new orders are supercritical. There are a small number of operational ultra-supercritical but currently no operational IGCC power plants. Generating capacity for conventional, critical, and supercritical coal-fired power generation with flue gas desulfurization is based on 1,000 megawatts, while the IGCC generating capacity is 250 megawatts. Sources: Williams, Robert H. 2001. Development of China’s coal utilization technology toward zero emission. Princeton: Princeton Environmental Institute; Tianjin Environmental Protection Research Institute. 2007. Huaneng Greengen Tianjin IGCC Project Environmental Impact Assessment Report. Tianjin; and International Energy Agency. 2007. World Energy Outlook.

48. Furthermore, the IGCC Project can provide favorable conditions for CO2 capture, which may have considerable global environmental benefits. IGCC coal-based power plant configuration is the least-cost option for CO2 capture, as it is captured before combustion. CO2 capture is also feasible for ultra-supercritical coal-fired plants, but there is a higher energy-use penalty of 10–12%, compared with 6–8% for IGCC. The IGCC Project will also provide steam and heat to other projects in the industrial park, which can save energy and avoid the discharge of SO2, NOx, slag, dust, and wastewater from facility-specific coal-fired boilers.

VII. ENVIRONMENTAL MANAGEMENT AND ENVIRONMENTAL MONITORING PLAN 49. Institutional Structure. The Huaneng Greengen Co. is the Executing Agency for this Project and has overall responsibility for ensuring that all environmental standards and procedures are followed. The company is also the project Implementing Agency (IA). Prior to project construction, Huaneng Greengen Co. will set up an environmental management unit (EMU), which will provide environmental supervision of contractors. The EMU will ensure implementation of the environmental management plan and environmental monitoring plan during the construction and operation of the Project. The EMU will be staffed by a project

16

manager and at least two technical personnel during the construction period. The construction contractor will designate an environmental representative, who will be responsible for the environmental management of construction. A project construction supervision company will be engaged, and the company will engage an environmental engineer to supervise environmental protection during project construction. During project operation, the project operator will establish an environmental monitoring station, which will undertake environmental monitoring in accordance with the environmental management plan and the environmental monitoring plan. 50. Environmental Management Plan. The summary environmental management plan, included as the Appendix, is based on the environmental monitoring plan in the Huaneng Greengen Tianjin IGCC Project Environmental Impact Assessment prepared by Tianjin Environmental Protection Research Institute in 2007. The IA will ensure that the SEIA (including a summary environmental management plan), EIA report, and plan for controlling soil erosion are included in all contractor bidding documents and operating contracts. The IA will ensure that the environmental management plan is updated prior to the commencement of construction, periodically during construction, and prior to the commencement of operation. The EMU will be responsible for implementing the environmental management plan and plan for controlling soil erosion during project construction and operation. The EMU will ensure that the environmental management plan is updated periodically during construction and operation. 51. Environmental Monitoring Plan. The EMU will (i) ensure the environmental monitoring plan from the EIA is included in all contractor bidding documents and construction contracts, (ii) ensure that the environmental monitoring plan is updated as required during project construction and operation, (iii) coordinate all environmental monitoring activities, and (iv) submit environmental monitoring reports (including physical data) to ADB twice annually during construction and once annually for 2 years after completion of construction. The environmental monitoring framework is presented in Table 15. 52. Environmental Management Bureaus. Tianjin Environmental Protection Bureau (EPB) will provide environmental monitoring of the project site during construction, including reviews of compliance with the environmental management plan and spot checks on pollution emissions. After the Project is put into operation, Tanggu EPB will be responsible for the environmental supervision of the Project. Tianjin EPB has a total staff of 100 and is supported by the Tianjin Environmental Monitoring Station, Environmental Science Research Institute, Environmental Assessment Center, and Environmental Supervision Agency. In general, the capacity of Tianjin EPB is sufficient. Tanggu EPB and Environmental Monitoring Station have a total staff of 40, including 14 environment officials. The Harbor Industrial Park Management Committee also has an established environmental and safety division, which currently has five staff, a number that will increase when more projects are constructed in the industrial park.

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Table 15: Environmental Monitoring Framework Item Authority Monitoring parameter Monitoring Frequency Construction

Air quality Local EPB TSP Monthly testing

Solid waste Local EPB Disposal of hazardous and other waste Monthly inspection

Operation

Wastewater discharge qualitya Local WRB pH, SS, CODcr, BOD5, metals scan, NH3-N, water flow, TPH Weekly, on-line COD monitoring

Air quality Local EPB CO, SO2, NOx, PM10 Twice every year at boundary

Emission monitoring Local EPB CO, H2S, SO2, NOx, PM10 On-line monitoring for flue gas from gas turbine

Noise Local EPB Noise at site boundary Twice every year Air quality at the slag yard Local EPB TSP Twice every year Ground water quality at slag yard Local WRB H2S Twice every year Filtrate at slag yard (discharge point) Local WRB H2S Monthly

BOD5 = biological oxygen demand (5 day), CO = carbon monoxide, COD = chemical oxygen demand, EPB = environmental protection bureau, H2S = hydrogen sulfide, NH3-N = ammonia, NO2 = nitrogen dioxide, NOx = nitrogen oxides, pH = acidity measure, PM10 = particulate matter below 10 microns, SO2 = sulfur dioxide; SS = suspended solids, TPH = total petroleum hydrocarbons, TSP = total suspended particles, WRB = water resources bureau. a Ongoing wastewater-monitoring parameters will be determined in consultation with the local WRB after analysis of initial screening. Tianjin Environmental Protection Research Institute. 2007. Huaneng Greengen Tianjin IGCC Project Environmental Impact Assessment Report. Tianjin

VIII. PUBLIC CONSULTATION AND INFORMATION DISCLOSURE A. Stakeholder Consultation before the Environmental Impact Assessment 53. On 1 February 2007, Tianjin Environmental Protection Research Institute uploaded the environmental information of the IGCC Project on the institute website (www.taes.org) for public review and comments. During the 20 days after uploading, the website was accessed 128 times, but no public response, e-mail, or phone calls were received regarding the Project. 54. Stakeholder consultation occurred between 5 and 7 February 2007, prior to finalizing the EIA, consisting of random distribution of 130 public consultation questionnaires to affected residents and organizations. The survey is considered to have covered a sufficient number of respondents in the project area and an acceptable demographic cross section. The major environmental concerns were potential impacts to air pollution and water pollution from the Project. These concerns were reviewed by management and considered during project design. A breakdown of the respondents and results is provided in Table 16 and Table 17.

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Table 16: Summary of Pre- Environmental Impact Assessment Survey Respondents Classification Respondent Details No. Responded Percent

Male 82 63 Number Surveyed Female 48 37 18–30 51 39 31–40 47 36 41–50 25 20 Age Distribution

>50 7 5 Junior high school or below 15 12 Senior high school 64 48 Education Level Junior college or above 51 40 Worker 61 47 Farmer 6 5 Official 18 14 Teacher 3 2 Student 5 4

Occupation

Others 37 28 No. = number. Source: Tianjin Environment Protection Research Institute. 2007. Huaneng Greengen Tianjin IGCC EIA. Tianjin.

Table 17: Pre-Environmental Impact Assessment Survey Results

No. Survey Content No. Responded Percent Satisfied 64 49 Acceptable 60 46 1

Are you satisfied with the environmental conditions in the project area? Not satisfied 6 5

Air pollution 73 56 Water pollution 25 19 Noise 12 9 Solid waste 5 4

2 What is the main environmental issue in the project area?

Nothing 15 12 Air pollution 62 48 Water pollution 26 20 Noise 10 8 Bad smell 0 0

3 What are your main environmental concerns regarding project construction?

Nothing 32 25 Clear 10 8 General 68 52 4 How well did you understand the

Project before? Nothing 52 40 Large 18 14Small 60 47Little 32 255

How much do you think the Project will impact the surrounding environment? Nothing 20 15

Vegetation 82 63 Noise screening 14 11 6 Which are preferred mitigation

measures (multiple choice) Discharge compliance 59 45 Large 12 9 Small 78 60 7

What do you think about the impact of project construction on the surrounding landscape? Nothing 40 31

Favorable 121 93Unfavorable 3 28

What do you think about the impact of the project construction on local economic development? Nothing 6 5

Employment 36 28Enjoying free time 27 21No impact 73 569

How do you think the Project will impact your living conditions? (multiple choice) Others 8 6

Positive 130 100 10 What is your attitude toward the Project? Negative 0 0

No. = number. Source: Tianjin Environment Protection Research Institute. 2007. Huaneng Greengen Tianjin IGCC EIA. Tianjin.

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B. Stakeholder Consultation after the Environmental Impact Assessment 55. During 18–21 February 2008, a second stakeholder consultation was undertaken to discuss environmental issues identified in the EIA. The post-EIA stakeholder consultation comprised the following:

(i) Interviews were conducted on 20 February 2008 with government officials from Tianjin EPB, Tianjin Harbor Industrial Park Management Committee, and experts from the Tianjin Environmental Protection Research Institute. The interviewees indicated that the Project should have positive environmental benefits. The main concern was controlling dust, particularly from coal storage areas.

(ii) Individual interviews were conducted during 18–21 February 2008 with people from local companies and organizations affected by project construction and operation. These companies and organizations include Blue Star Chemical Co., Huabing Water Service Co., and Shengke Wastewater Treatment Co. The interviewees considered that the Project is generally environmentally friendly with high energy efficiency and low pollution emissions compared with conventional coal-fired power projects.

(iii) Questionnaires were distributed to 50 local residents and effected companies.

The most important environmental concerns about the Project related to dust control. Specific comments include a requirement for strict control of coal dust and PM10 and the use of low-sulfur coal. The responses to the questionnaire are summarized in Table 18.

(iv) Discussions were held with nongovernment organizations in Beijing, who

expressed support for the Project, and whose main concern was related to potential air pollution.

Table 18: Summary of Post Environmental Impact Assessment Survey Respondents Classification Respondent Details Number of Respondents %

Male 42 84 Female 8 16 Number

Surveyed Total 50 100 18–30 15 30 31–40 20 40 41–50 11 22 Age Distribution

>50 4 8 Junior high school or below 0 0 Senior high school and technical secondary school 9 18 Education Level

Junior college or above 41 42 Worker 6 12 Farmer 0 0 Local company staff 29 58 Government officials 11 22 Teacher 0 0 Student 0 0

Occupation Structure

Others 4 8 Source: Survey undertaken by the project preparatory technical assessment consultants, February 2008.

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Table 19: Post- Environmental Impact Assessment Survey Results No. Survey Content No. Responded Percent

Satisfied 33 66 Acceptable 15 30 1

Are you satisfied with the environmental conditions in the project area? Not satisfied 2 4

Air pollution 47 94 Water pollution 3 6 Noise 0 0 Solid waste 0 0

2 What is the main environmental issue in the project area?

Nothing 0 0 Air pollution 36 72 Water pollution 4 8 Noise 0 0 Bad smell 0 0

3 What are your main environmental concerns regarding project construction?

Nothing 10 20 Clear 10 20 General 37 74 4 How well did you understand the

Project before? Nothing 3 6 Large 0 0 Small 31 62 Little 14 28 5

How much do you think the Project will impact the surrounding environment?

Nothing 5 10 Vegetation 32 64 Noise screening 3 6 6 Which mitigation measures do you

prefer? (multiple choice) Discharge compliance 44 88 Large 1 2 Small 15 30 7

What do you think about the impact of project construction on the surrounding landscape? Nothing 34 68

Favorable 50 100 Unfavorable 0 0 8

What do you think about the impact of the project construction on local economic development? Nothing 0 0

Employment 2 4 Enjoying free time 0 0 No impact 45 90 9

How do you think the Project will impact your living conditions? (multiple choice)

Others 3 6 Positive 50 100 10 What is your attitude toward the

Project? Negative 0 0 No. = number. Source: Survey undertaken by the project preparatory technical assessment consultants, February 2008.

IX. CONCLUSION

56. The Tianjin Integrated Gasification Combined Cycle (IGCC) Power Plant Project consists of a 250 MW IGCC power plant located in the Harbor Industrial Park, Tanggu, Tianjin, PRC. The estimated total investment for the Project is $300 million, and the proposed construction period is 4 years. The primary function of the Project is to provide baseload electric power generation to the local power grid and provide heat and steam to projects in the industrial park. The Project will occupy 20 ha of industrial land, and no resettlement will be required. Major potential environmental impacts from the IGCC Project include (i) soil erosion during construction, (ii) lower air quality, (iii) lower surface water quality, and (vi) noise. Potential environmental impacts and risks have been identified, and measures developed to mitigate them. Based on the results of the EIA, the adverse environmental impacts of the Project can be minimized to acceptable levels with adequately funded environmental management. The Project has significant environmental benefits in improved generation efficiencies and reduced emissions compared with conventional coal-fired power generation. The Project offers significant benefits by demonstrating IGCC technology for subsequent scaling up both nationally and internationally.

Appendix 21

SUMMARY ENVIRONMENTAL MANAGEMENT PLAN Responsibility

Impact

Mitigation Measures

Location Implementation Supervision A. Construction Phase 1. Soil Soil erosion

(i) Laying compacted topsoil and re-vegetation of exposed surfaces as quickly as possible after construction as each area is completed, (ii) installing sediment fences for temporary soil stockpiles, and (ii) allowing sediment to settle in sedimentation ponds or storm water channels prior to discharge into Bohai Sea. Impact to soil from construction traffic will be minimized by confining traffic to predetermined roads. Spoil generated from construction activities will be stockpiled, dewatered,and used for landscaping where possible or removed from site to approved disposal areas. Sediment fences will be installed around spoil stockpiles.

Construction site

Contractor Local WRB, EMU

Soil contamination

Installing (i) oil separators at wash-down and refueling areas and (ii) appropriate hazardous waste and hydrocarbon storage facilities at site, including secondary containment at fuel storage sites. All septic waste will be collected and removed from site. Spill cleanup equipment will be provided at each construction site, and training will be conducted regarding response procedures for emergency spills. All hazardous and other waste will be removed from site to approved waste disposal sites. There will be no on-site landfill.

Construction site

Contractor Local WRB, EMU

2. Wastewater Disposal of septic wastewater

During construction, septic wastewater will be collected and disposed of off site, disposed of in theindustrial park wastewater treatment facilities, or treated and recycled on site. There will be no on-site septic seepage disposal system or direct discharge of sanitary waste to surface water.

Work camps Contractor Local EPB, EMU

Disposal of wash-down water

All equipment wash-down areas will have oil separators.

Wash-down areas

Contractor Local EPB, EMU

3. Air Quality Dust generation All major access roads will be paved, and water trucks will suppress dust on unpaved roads.

Temporary soil stockpiles will be covered. Excavation will be limited when wind is greater than grade 4. Construction workers will be forbidden to burn coal or firewood on site.

Construction sites, access roads

Contractor Local EPB, EMU

4. Noise Noise impacts Equipment and machinery used in construction shall strictly conform to PRC and local noise

standards. All equipment will be properly maintained to minimize noise. Noise emissions from the site will meet relevant national standards. Ongoing noise monitoring will be undertaken to ensure compliance. Mitigation measures during operation for noise impacts on workers will include standard occupational health and safety practices to relevant PRC standards.

Project Site Contractor Local EPB, EMU

5. Solid Waste and Hazardous Materials Hazardous and non hazardous waste

All residential rubbish and waste building materials will be collected, stored on site in appropriate storage facilities, and transported off site to approved disposal facilities. No on-site landfills will be developed. Impacts from the transportation and disposal of spoil may include spillage along access roads, creating hazards to vehicles and increased dust or mud on access roads. Trucks used for transporting spoil will be covered, and any spillage will be cleaned up immediately. Hazardous waste generated during construction will be collected and stored separately on site in approved facilities. Hazardous waste will be removed from site to approved hazardous waste-disposal facilities by a

Project Site Contractor EMU, Local EPB

22 Appendix

Responsibility Impact

Mitigation Measures

Location Implementation Supervision

licensed waste transportation company. 6. Social Impact Impact to livelihoods of residents

Where possible, local labor will be used during construction. Local suppliers will be used where possible. Mitigation measures will include providing health education to workers and hygienic worker accommodation.

Nearby residents and construction workers

HGC HGC

B. Operation Phase Soil Soil erosion from exposed areas will be mitigated by ensuring exposed areas are compacted and re-

vegetated where possible. Soil contamination will be prevented by installing oil separators at wash-down and refueling areas and installing secondary containment at fuel storage sites. All hazardous wastes and hazardous materials will be stored in properly designed storage facilities.

Project site EMU WRB

Wastewater disposal

Recycling system and cooling tower wastewater will be disposed of at the site wastewater treatment plant and then at the Harbor Industrial Park wastewater treatment plant. Chemical water treatment and boiler operation wastewater, coal-gasification wastewater, and sulfur-recovery systemwastewater will be treated on site and disposed of at Harbor Industrial Park wastewater treatment plant. Air-separation system wastewater will be recycled as make-up water for the cooling tower.Other industrial wastewater will be collected and treated on site (air flotation) and then reused as make-up water for cooling recycling water. Residential wastewater will be treated on site by two-stage biological contact oxidation method and reused on site.

Project site EMU Local EPB

Emission Control

Cyclone emission control and wet scrubbing will be used for raw syngas purification. Shell-Paques biological desulfurization process is used for sulfur recovery from raw coal gas. Bag dust collector will be installed at coal processing system. Water spraying will be used for dust control at the power plant, and raw coal stored in totally closed bunkers and transported under closed conditions. Closed transport and vehicle cleaning will be used to control flying dust. Ongoing air quality monitoring will ensure compliance with local air quality standards. The coal processing system will have a bag dust collector with dust removal efficiency of 99.9%. NOx emissions will be controlled by using a low-NOxburner and steam injection (100 tons per hour) before the syngas enters the gas turbine. Mercury emissions will be controlled by selecting low-mercury Shenhua coal and high dust removal techniques that will achieve 90% mercury removal efficiency.

Project site EMU Local EPB

Noise impacts Noise mitigation measures will include enclosure of relevant equipment, noise suppression controls on relevant machinery, and siting of particular facilities away from property boundaries. Ongoing noise monitoring will assess compliance with the requirements of noise standards at industrial facilityboundaries (GB12348-1990). Mitigation measures during operation for noise impacts on workers will include standard occupational health and safety practices to relevant PRC standards.

Project site EMU Local EPB

Solid waste disposal

Hazardous waste generated during construction will be collected and stored separately on site in approved facilities. Hazardous waste will be removed from site to approved hazardous waste disposal facilities by a licensed waste transportation company. Storage, collection, transportation,and disposal of hazardous wastes will be conducted in conformance with relevant PRC regulations.Potential fire hazards from leaked syngas will be mitigated by establishing a firefighting system. Other measures include (i) work safety precautions with site selection and arrangement of buildings;(ii) safety measures at each stage of the production process, such as automatic cut-off valves; (iii) safety measures for electric and telecommunication devices; (iv) installing fire protection and fire

Project site EMU Local EPB

Appendix 23

Responsibility Impact

Mitigation Measures

Location Implementation Supervision

alarm systems; (v) establishing a work safety responsibility system; (vi) specific safety measures for diesel storage area; and (vii) emergency response system closely integrated into the local industrial park emergency response system.

EIA = environmental impact assessment, EMU = environment management unit, EPB = environmental protection bureau, HGC = Huaneng Greengen Co., PRC = People’s Republic of China, t/d = metric tons per day, WRB = water resources bureau. Source: Tianjin Environment Protection Research Institute. 2007. Huaneng Greengen Tianjin IGCC Project Environmental Impact Assessment. Tianjin.