Chapter – 3

Environmental & Social impacts

Management & Mitigation measures
 Chapter – 3
Hydropower Projects: Environmental & Social impacts Management & Mitigation
measures
Agenda

• Types of Hydro-Electric Projects (HEP)

• Components of an HEP
• Regulatory Process: Environmental & Social
• Permits and Licenses during the Project lifecycle
• Key Concerns: Environmental
• Key Concerns: Social

Type of common Hydro Electric Projects

Conventional (dams):

• A large reservoir is created by constructing a dam to store river water for major hydro
power project.
• Water released from the reservoir flows through a turbine, spinning it, which in turn
activates a generator to produce electricity.
• The water is released through power intake either to meet peak electricity demands or
base load needs or through spillways to maintain a constant reservoir level.

Run-Off River:

• A small reservoir is created by constructing a dam / diversion weir to divert river flow
through head race tunnel to an adjacent valley utilizing the available head for power
generation.

34
Hydro Power projects in India

Components of HEP

Key components

A typical run-of-river project consists of the following components:

• An intake and weir structure;

• A penstock (pipeline or tunnel or both) through which water travels downhill;
• A powerhouse that houses generation equipment (turbines);
• A tailrace where the water is returned to its natural watercourse;
• A substation; and
• A transmission line.

35
Source: Cleantech Investor.org

Weir Intake:

• The weir and intake structure is used to divert a portion of a river‘s flow into a penstock
(pipeline or tunnel or both).
• The structure typically is composed of a low concrete weir and /or adjustable flap gate
that create a small headpond and diversion channel that allows the facility to direct
water into the penstock.
• The weir and headpond on run-of-river facilities are used for diverting flows that mirror
natural flows in the river.

Penstock:

• The penstock is typically a pipeline or tunnel that transports the diverted water
down hill from the intake to the powerhouse.
• The elevation drop and amount of water diverted determines the amount of energy
generated from the facility.

Powerhouse:

• The power house is a building that houses the turbines used to generate electricity.
• Water from the penstock enters the powerhouse, where it is fed into the turbines. The
water spins the turbines, which are connected to a generator, to create electricity.

Tailrace:

• Once the water passes through the turbines, the tailrace returns the water from the
powerhouse to the natural watercourse:

36
Substation:

• The substation or switchyard at a run-of-rover facility contains transformers that

convert the electricity produced un the powerhouse to a higher voltage, so the
electricity is more efficiently transported over long distances on transmission lines;

Transmission Line:

• Electricity generated in the powerhouse is delivered to the electric system through a

transmission line or power line.

Schematic Diagram of A Run off River project

Source: PME Bandung commercial Hydro-unit

37
Muck disposed within River bed near Power house

Source: Jorethang HEP, Sikkim Source: PME Bandung commercial Hydro-unit

High sediment carbonaceous water discharged directly to the Rangit River Near
Barrage at Jorethang

Source: Jorethang HEP, Sikkim

38
 Fish Ladder Kuricchu- Bhutan HEP

Source: Kuricchu, Bhutan website Source: Explosives-Magazines- www.seiscones.com

Regulatory Process related to HEP

Clearance Process in India

• Preliminary Report: Since July 2002, the concerned project proponent in the initial stage,
will first submit Preliminary Report covering surveys & investigations,
international/interstate aspects, hydrology, irrigation planning, environmental aspects,
intended benefits etc. which are required to establish soundness of the project proposals.
• In Principal Consent by CWC: The project proposal will be examined and if found
acceptable, the Central Water Commission (CWC) shall convey ‗In Principle Consent‘ for
preparation of Detailed Project Report (DPR).
• Review of DPR: The DPR thus prepared will be examined in CWC and project proposal will
be put up to the Technical Advisory Committee (TAC) for clearance.
• Clearance from MOEFCC Simultaneously the project authorities will process and obtain
necessary clearances of MOEFCC in respect of EIA and forest area diverted.
• Clearance from MoTA: If Scheduled Tribe population is affected, the clearance of R&R
plans will be obtained from the Ministry of Tribal Affairs.

Environmental Clearance Process in India

As per the Ministry of Environment &Climate Change (MoEFCC) EIA notification dated,
14th September ,2006 and as amended till date, River alley proejcts have been classified as
Category 1 (c) as follows:

• Category A

• (i)  50 MW hydroelectric power generation;

• (ii)  10,000 ha. of culturable command area

39
• Category B

•
• (ii) < 10,000 ha. of culturable command area
General Condition shall apply. Note: Irrigation projects not involving submergence or inter-
state domain shall be appraised by the SEIAA as Category ‗B ‗ projects.‖

Relevant Enforcement Agencies

The National National Green tribunal has been constituted in 2010 for effective and
Green Tribunal expeditious disposal of cases relating to environmental protection and
conservation of forests and other natural resources including
enforcement of any legal rights relating to environment and giving
relief and compensation for damages to persons and property. The
tribunal will have jurisdiction over all civil cases relating to
implementation of the following regulations:
 The Water Act, 1974;
 The Water Cess Act, 1977;
 The Forest Conservation Act, 1980;
 The Air Act, 1981;
 The Environment Protection Act, 1986;
 The Public Liability Insurance Act, 1991; and
 The Biological Diversity Act, 2002
The Act provides for compensation on account of following
 Relief and compensation to the victims of pollution and other
environmental damage arising under enactment of the above
acts;
 Restitution of property damaged; and
 Restitution of the environment.
District Land acquisition, if any under the Land Acquisition Act, 1894 for the
Administration proposed project will be regularised by the State government through
(Collector‘s district collector‘s office.
Office)
This act is now replaced by Right to Fair Compensation and
Transparency in Land Acquisition, Rehabilitation and Resettlement
Act 2013. Presently Ordinances too have been issued
State Labour All issues pertaining to implementation of labour laws in any
Department establishment, shop or factory.
Indian Renewable IREDA was established on 11th March, 1987 as a Public limited
Energy Government Company under the Companies Act, 1956 and it
Development promotes, develops and extends financial assistance for Renewable
Agency Limited Energy and Energy Efficiency/Conservation Projects. IREDA has
(IREDA) been notified as a ―Public Financial Institution‖ under section 4 ‗A‘ of
the Companies Act, 1956 and registered as Non-Banking Financial
Company (NFBC) with Reserve Bank of India (RBI). The main
objectives of IREDA is to provide financial support to specific
40
 projects and schemes for generating electricity and / or energy through
new and renewable sources and conserving energy through energy
efficiency
State Pollution The Board is the implementing agency for various environmental
Control Board legislations in the states, mainly including Water (Prevention and
(SPCB) Control of Pollution) Act, 1974, Air (Prevention and Control of
Pollution) Act, 1981, Water (Cess) Act, 1977 and some of the
provisions under Environmental (Protection) Act, 1986 and the rules
framed there under like, Biomedical Waste (M&H) Rules, 1998,
Hazardous Waste (M&H) Rules, 2000, Municipal Solid Waste Rules,
2000 etc.

Key Environmental Legislations

Specific requirements of HEP Terms of Reference for EIA

• Various details regarding the project layout etc., would be depicted in proper scale
maps at least at 1:50,000 like:
• Location map of proposed HE project
• Location map of the project area with contours indicating main project features,
• Drainage map of the river catchment up to the proposed project site,
• Soil map of the project area.
• Geological and Seismo-tectonic maps of the area surrounding the proposed project
site showing location of dam site and powerhouse site, and
• False Color Composite (FCC) generated from satellite data of project area and land-
use / land-cover prepared from these images.

• Run off, discharge, water availability for the project, sedimentation rate, etc.
• Basin Characteristics
• Documentation of the existence of barriers and corridors (if any) for wild animals, the
habitat fragmentation and destruction of wild animals due to project
41
Specific requirements of Terms of Reference for EIA

• Muck Disposal Plan. Estimation of Muck quantity, swell factor, muck utilization, if
any; identification of muck dumping sites and capacities; locations on layout map,
engineering measures for stabilization and restoration plan after completion of
dumping.
• Catchment Area Treatment (CAT) plan shall be prepared micro-watershed wise.
Areas/watersheds falling under 'very severe' and 'severe' erosion categories are
required to be treated. Both biological and engineering measures would be proposed.
Year-wise schedule of work and monetary allocation would be provided.
• Public Health Management Plan to mitigate the impacts on health of locals and
workers. This include provisions of health care facilities, ambulances, awareness
programs, health checks etc. with budgets.
• Fishery Conservation & Management Plan including base line data on catch
composition, fish density, fish standing crop, fish population dynamics in and around
project area, presence of migratory/endangered fish if any to be checked and
mitigation measures should include monitoring the impact of the proposed
construction on the fish resources.
• Sanitation & Solid Waste Management Plan for domestic waste from colonies and
labour camps, etc.
• Local Area Development Plan/Tribal Area Development Plan to be formulated in
consultation with the Revenue Officials and Village Panchayats.
• Compensatory Afforestation: in case of diversion of forest land

Specific EC conditions laid by MoEF

• Catchment Area Plan should be considered for the project development;

• The identified dumping sites for dumping of the excavated material should be used
for muck disposal. For retaining the dumped/unused material for subsequent
stabilization along the hill slopes and along the stretch of the road-sausage-cum-
retaining walls are usually suggested to be developed. Also, these dumping yards are
suggested to blend with the natural landscape by developing sites with gentle slopes,
bunds, terraced and water ponds, patches of greenery in and around them;
• Fishery management Plan should be proposed; and
• Environmental Flow in the river is suggested to be released during lean season
between 10-15 %.

Key Social Legislations

• Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation

and Resettlement Act 2013;
• Land Acquisition Act, 1894 and its amendments for existing projects;
• National Policy for Rehabilitation and Resettlement 2007;
• State Panchayati Raj Act;
• State Tenancy Acts;
42
 • Panchayats (Extension to Scheduled Areas) Act, 1996 or PESA;
• The Scheduled Tribes and Other Traditional Forest Dwellers (Recognition of Forest
Rights) Act, 2006;
• Specific Provisions related to sell and purchase of ST land in various states;
• Companies Act, 2013- CSR Clause; and
• Labour Laws across the lifecycle of the Project

Key Environmental concerns

Summary of Impacts

Project activity Impacts

Pre-project construction stage
Minor infrastructure (viz. roads, Land acquisition: displacement, loss of homes,
houses) agricultural land, CPRs, livelihoods

Deforestation: loss of forest cover, biodiversity

loss, access to CPRs, landslides

Disposal of debris: loss of vegetation, pollution–

noise, air, water, land
Project construction stage
Major infrastructure (dams, Land acquisition: displacement, land use changes
tunnels, power house, facilities) Deforestation: loss of forest cover, biodiversity loss,
landslides

Disposal of debris: loss of vegetation, pollution–

noise, air, water, land

Geological: slopes destabilisation, disruption of

underground seepages, disruption of river flows–
biotic changes, sediment disposal, nutrient cycling,
loss of aesthetic, cultural values
Operations stage
Operation and management (water Slope destabilisation: loss of tree cover
storage/release, power lines)
Sedimentation (effect on river water quality)

Disruption of river flow

Secondary effects (earthquake risks, floods, land

use changes)

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Impacts due to Project Design

Hydrological Balance

Changes in the hydrological balance caused by the construction of the dam, reservoirs and
canals;

• Evaporation losses from reservoirs;

• Expected rise in groundwater table, and
• Impact on aquatic ecosystems including fish; aquatic birdlife, spawning areas and
seasonal migration.

Drainage

• The risk of water logging/flooding;

• Siltation, eutrophication, salinization & alkalinization risks, and
• Adequacy of proposed drainage network.
Dam, Canals and structures

• Adequacy of proposed drainage network.

• Adequacy of planned provision to prevent excessive aquatic weed growth, erosion
and seepage, and design of culverts, intakes and protective structures to prevent bank
scouring.

Impacts due to Project Construction Phase

Soil Erosion

• Runoff during rains from excavated areas, quarry sites, dam faces etc. can result in
soil erosion.
• Adequate provisions for revegetation, dressing, resurfacing of burrow pits etc. should
be ascertained.

Construction Spoils

• Adequacy of provisions for dumping of construction spoils, waste materials etc.

should be reviewed.

Public Health

• Improvement in availability of water for various uses;

• The adequacy of sanitation in workers' camps, and the vectors;
• The vectors that may transmit diseases from local carriers to immigrant labour and
staff and vice-versa.

Residues of Agro-Chemicals

• Expected increase in the use of pesticides and fertilizers

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 • Adequacy of provisions made in the project for ensuring proper and safe use of
fertilizers and pesticides;

Impact on Soil

• Improvement of fertility and increase in agricultural production;

• The risk of waterlogging ;
• Salinization and alkalization risks;
• Expected modifications in soil structure and texture, and
• Expected soil losses from runoff due to project operation
Ground Water

•Possible changes in ground water quality as a result of percolation of toxic residues of

agro-chemicals and its effects inside and outside the project area should be carried
out.
Impacts due to Project Operation Phase

Changes in Surface Water Quality and Eutrophication

• Risk of surface water pollution by residues from agro-chemical, future trends and
• Its effect on fisheries and aquatic ecosystem;
• Risk of eutrophication of reservoir water by sediment, nutrient leaching and fertilizer
residues, and consequently, the risk of invasion of noxious aquatic weeds, such as
water hyacinth;

Water Related Diseases

• Changes in water quality, eutrophication, weed growth and the increase in areas of
stagnant water on the proliferation of insects or other vectors of water-related human
and livestock diseases.
• Present (pre-project) incidence of main water related diseases in the project area from
surveys and existing public health records;
• Risk of introduction of new pathogens and disease vectors;
• Health care facilities, especially in the resettled area, and
• Adequacy of planned measures to reduce the spread of water related diseases.

Environmental Flows

• Alteration of natural flow of river

• Impacts its ecological functions and

• Affects the social, economic, cultural, and recreational values to the local
communities.

• Impacts on the river and floodplain ecosystems

• Change in the annual cycle of flooding and drying.

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 • Impact on many species which depend on seasons to provide the signals for
reproduction, hatching, migration or other important lifecycle stages.
• Rapid fluctuations affecting spawning of fish

• Change in water levels can prevent the spawning of fish by exposing or

submerging the favoured nesting areas in shallow waters.

• Nutrient delivery impacted

• Nutrient delivery to offshore areas could be disrupted by upstream damming

activities that could have serious implications for the biogeochemistry and algal
ecology of the downstream areas.

Biodiversity

HEPs are usually located in the presence of range of ecosystems including mountains,
grasslands, subtropical and temperate broadleaf forests, mixed coniferous forests and alpine
meadows.

• Ecosystem supporting a vast diversity of flora and fauna impacted, including many
threatened and endangered species.

• Impact on the biodiversity-rich forests supporting local community needs like food,
fuel wood, fodder, fibre, medicines, building material and other life supporting
resources to the local communities.

• Impact on the aquatic fauna in the rivers because of the alteration in the flow patterns

• Land diverted for the project activities including quarrying, construction of access
roads, housing colonies, warehouses, temporary labour camps

• Disposal of muck leads to deforestation further impact the biodiversity of the region.

• Fragmentation of forests due to hydropower projects could impact wildlife movement

in the area and also heightens the risk of poaching, especially where the projects are
located near protected areas.

Muck Disposal

The unscientific disposal of muck generated during the construction of hydropower projects
causes social and environmental hazards in the area where it is dumped.

• Loose muck increases the level of suspended particulate matter in the atmosphere
causing serious health hazards and photo-retardation among the local population.
• Muck which leaches into the aquatic ecosystems and increases the turbidity of water
that has serious impact on the aquatic life due to change in water quality and reduction
in the availability of light.
• Muck disposal on higher grounds increase losses during flood especially
with high sediment load;
• Improper management of muck (without cast walls or retention walls or without
46
 restoration of vegetation) increases the damage during floods.

Key Social concerns

Displacement & Compensation

• Low value of land in remote hilly areas resulting in low compensation for land;
• Non-existent, delayed, inadequate or badly-defined eligibility criteria;
• Inadequate compensation (lesser quantity of land than eligible);
• Lack of land for land option;
• Uncultivable nature of compensatory land;
• Non-availability of irrigation sources;
• Poor soil conditions or land being scattered;
• Rare attempts to compensate for loss of common property resources (CPRs).
• Cash based compensation do not reflect the ‗true‘ replacement cost of the asset.
• Some projects defined all those living under the same roof or sharing a common kitchen
were eligible for R&R package, while in others is was defined as the eldest surviving
male, in whose name the property was registered.
• Benefit sharing with the local community.

Resettlement and Rehabilitation

Key issues related to R&R include:

• Lack of employment opportunities for displaced communities;

• Access to natural resources, health and education facilities;
• Rehabilitation packages (lesser than replacement cost, delay in payment);
• Processes related to displacement (lack of or misleading information, inadequate
warning);
• loss of livelihoods;
• Quality and quantity of rehabilitated land;
• Lack of effective stakeholder engagement;
• Lack of monitoring or redressal mechanisms.

Other Social impacts

• The influx of migrant workers from other parts of the country for construction can
impact the community life of the locals.
• Tribal populations normally have close ties with rivers, forests, hillocks and animals.
• Hourly, daily and seasonal change in the river flow, due to the construction of dams,
impacts the locals massively.
• Impounding of water in the dams is known to cut off access roads thus isolating
villages/ communities. This has adverse effect on the economy of the locals.
• Cumulative impact of a number of dams in one region or as a cascade of dams on
one river.
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 • Himalayan region has been known to be seismically very sensitive, and hence dams in
these regions face potential risks of catastrophic failure from earthquakes.
• Loss to house structures during blasting for construction of utilities including access
roads and other structures;
• Opening up of new streams during blasting activities.

Floods in Uttaranchal -2013

Uttarakhand has set an ambitious programme to develop 450 hydroelectric projects (HEPs) to
harness its potential of 27039 MW.

• So far 92 projects with a total installed capacity of 3624 MW have been commissioned.
Of these, 15 large and medium projects account for 95 per cent of the installed capacity.
Another 38 projects with an installed capacity of 3292 MW are under construction.
Here too 8 large and medium projects account for 97 per cent of the capacity.

Studies in the various stretches of the river suggest that:

• A series of dams on the Bhagirathi between Maneri in Uttarkashi district and

Koteshwar in Tehri Garhwal district have disrupted free flow in a stretch of about 110
km, almost half the length of the Bhagirathi from its origin to Devprayag.
• A comprehensive study by NEERI has highlighted the deleterious effect of the
• Tehri dam on the unique self-purifying ability of Gangajal in the Bhagirathi.
• A bio-monitoring study by scientists of the Central Pollution Control Board (CPCB) of
11 rivers in Uttarakhand including 5 HEPs sites stated that barrages ‗have drastically
changed the ecological sustainability of rivers in the state‘.
• The most serious impact has been the submergence of riverine ecosystem. Other
impacts that have been cited include the loss of forest area and critical wildlife habitats.
• Geological Impacts: Several official committees have confirmed that slope instabilities
leading to landslides and subsidence on the rim of the Tehri dam reservoir due to the
raising and lowering of the water level have occurred.
• The analysis highlighted the fact that floods are not just about water but water and
sediments. The major damage was inflicted by the sediments and water rather than just
the water.

Case Studies
Tapovan The 520-MW hydropower project is  Compensation:
Vishnugad located on the Dhauliganga river, a  Insurance provided to assets
tributary of the Alakananda river in owned by PAPs against
Chamoli district of Uttarakhand. The damages caused ;
project is being developed by NTPC
 Provision for an annual
appreciation of 5% for the
insured assets;

48
Case Studies
Karcham The 1,000-MW hydropower project is  Release of mandatory 15%
Wangtoo located on Satluj river in Kinnaur flows during lean season;
district of Himachal Pradesh. Slated as  Provisions exists for accessing
the largest private sector project, it is real- time flows data through
developed by Jaypee Associates the project website
Parbati II The 800-MW hydropower project  Unique and innovative
developed by NHPC is located on the arrangement for muck
Parbati river in Kullu district of Management;
Himachal Pradesh  Minimal impact on the local
environment;
 Local species planted in the
disposal sites after suitable
treatment
Baira Siul The 180 MW hydropower project is  Benefit sharing;
located in the Chamba district of  Cost of infrastructure for
Himachal Pradesh. Developed by supplying power supply
NHPC, the project uses inflow of three (electric line, transformers,
tributaries (Baira, Siul, and Bhaledh) of meters) borne by the project
river Ravi authorities

49
 Applicability of Key Indian Legislations and the Reference Framework during different phases of Project Life Cycle-HEP

Applicable Indian Pre- Construction Operations Decommissioning Agency Remarks

Legislation/Guidelines/International construction Responsible
Conventions
Land Purchase
Revenue Order nO1, 21/282/LR (S) for Land √ √ X X District Collector Land has been both
and its Value 7th August 2006 and Revenue acquired as well as
Department purchased.

Forest Clearance and Wildlife

Forest Conservation Act 1980 √ √ X X Forests, Forest Clearance to be
Environment & obtained for forest
Wildlife diversion in HEPS
Management
Department
State Government

Wildlife Protection Act, 1972, 2002 and Rules, √ √ X X Forests, If any protected/
2003 and as amended Environment & endangered flora or fauna
Wildlife (as listed in Schedules of
Management WP Act, 1972) are found
Department in the project area,
State Government conservation measures
require be proposing and
implementing for their
protection.
Environment Protection
The Air (Prevention and Control of Pollution) X √ √ √ SPCB Permissible limits for
Act 1981, amended 1987 MoEF CPCB ambient air quality have
been laid
down by CPCB under this
act which requires to be
complied with.

50
Applicable Indian Pre- Construction Operations Decommissioning Agency Remarks
Legislation/Guidelines/International construction Responsible
Conventions
Environment Protection Act, 1986 and as X √ √ √ SPCB Permissible limits for
amended MoEF CPCB ambient air quality, water
quality,
noise limits has been laid
down by CPCB under EP
Act, 1986 which requires
to be complied with.
The Noise (Regulation & Control) √ √ √ √ SPCB Per the Act, ambient noise
levels are to be maintained
as
Rules, 2000 and as amended up to 2010 stipulated in the rules for
different categories of
areas such as residential,
commercial, industrial and
silence zones.
Ambient Noise Standards X √ √ x SPCB, MOEF Considering the context of
the project, Project
Proponent will need to
abide by the limits
prescribed for residential
zones.

As the project is in
rural/residential set up,
noise standards for
residential area will be
applicable for the project.
Storage of Hazardous Chemicals
Manufacture, Storage and Import of Hazardous X √ √ X SPCB MHISC Rules will be
Chemicals (MSIHC) Rules, applicable during
1989 and as amended construction and operation
phases if chemicals stored
at site satisfy the criteria
laid down in the Rules.

51
Applicable Indian Pre- Construction Operations Decommissioning Agency Remarks
Legislation/Guidelines/International construction Responsible
Conventions
Handling of Hazardous Wastes
Hazardous Wastes (Management Handling and X √ √ √ SPCB Generation of waste oil
Trans boundary Movement) Rules, 2008 as and transformer oil at site
amended attracts the provisions of
up to 2010 Hazardous Waste Rules,
2008. The hazardous
wastes have to dispose
through approved
recyclers only.
Labour and Working Conditions
Building and Other Construction Workers Act, √ √ √ √ State Labour Project Proponent will
1996; Department & need to comply to the
The Building and Other Construction Workers Department of requirements of the these
Cess Act, 1996 Inspectorate of regulations
H.P. Building and Other Construction Workers Factories, State
(Regulation of Employment and Conditions of Government
Service) Rules, 2008
Inter-state Migrant Workers Act, 1979; Contract
Labour Act, 1970
The Industrial Employment (Standing orders)
Act, 1946,
Employment Exchanges (Compulsory
Notification of Vacancies) Rules,1960
H.P. Industrial Establishments (National &
Festival Holidays, Casual & Sick leave) Act,
1969
H.P. Industrial Establishments (National &
Festival Holidays, Casual & Sick Leave) Rules,
1970 Compliance of Licensing and Registration
of Factories
The Child Labour (Prohibition and Regulation)
Act, 1986;
Bonded Labour (Abolition) Act 1976; Minimum
Wages Act, 1948;

52
Applicable Indian Pre- Construction Operations Decommissioning Agency Remarks
Legislation/Guidelines/International construction Responsible
Conventions
Equal Remuneration Act 1976; Workmen's
Compensation Act, 1923; Maternity Benefit
Act, 1961.
Contract Labour (Regulation and Abolition)
Act, 1970
Employees provident fund and miscellaneous
provisions Act, 1952 Industrial Disputes Act,
1947
Factories Act, 1948
Equal remuneration Act, 1976 Employees State
Insurance Act, 1948 Industrial Employment
(standing orders) Act, 1946
Maternity Benefit Act, 1961 Minimum Wages
Act, 1948
Motor Transport Workers Act, 1961 Payment of
Bonus Act, 1965 Payment of Gratuity Act, 1972
Payment of Wages Act, 1936
Sales Promotion Employees (Conditions of
Service) Act, 1976 Workman Compensation
Act, 1923 The Employment Exchanges
(Compulsory Notification of Vacancies)
Act,1959.
Trade union Act, 1926
IFC/World Bank Guidelines
IFC Performance Standards √ √ √ √ Equator To be used for preparing
Principles report for EPFIs
Financing
Institutions

53
Applicable Indian Pre- Construction Operations Decommissioning Agency Remarks
Legislation/Guidelines/International construction Responsible
Conventions
IFC/World Bank General EHS X √ √ √ Equator During the construction,
Guidelines Principles operation and eventual
Financing decommissioning of the
Institutions site, the following
guidelines will need to be
followed.

IFC Guidelines for Power Transmission and X √ √ √ Equator

Distribution Principles
Financing
Institutions

54
ENVIRONMENTAL AND SOCIAL MANAGEMENT FRAMEWORK (ESMF) for
POWER SECTOR REFORM AND SUSTAINABLE HYDROPOWER
DEVELOPMENT PROJECT

A. Background

The proposed Nepal Power Sector Reform and Sustainable Hydropower

Development Project (PSRSHDP), the Project, intends to offer a holistic and coherent
set of technical and analytical studies capacity-building activities and policy dialog on
the energy sector in Nepal, and preparation of next-step critical hydropower and
transmission line projects to prepare Nepal for upcoming large-scale private and public
investments in hydropower. The project is an advisory support that will not finance any
civil works or physical implementation, under any circumstances .This Environmental
and Social Management Framework (ESMF) lays out the specific requirements,
processes, and responsibilities for ensuring that the activities of the Project are carried out
in a manner that complies with World Bank safeguard policies and Nepal‘s
environmental and social laws and regulations and to enhance the Project‘s positive
impact on enhancing the environmental and social sustainability of power sector
investments in Nepal.

This executive summary explains the main aspects of environmental and social
management of the proposed Project. More detail is available in the full ESMF, including
its detailed annexes. The Full ESMF is available for download at

NEA: http://www.nea.org.np/publications.html

WECS:http://www.wecs.gov.np/reports-publications.php
DOED:http://doed.gov.np/download.php

B. Brief Project Description

The project development objectives are to (a) strengthen the capacity of the power sector
agencies to plan and prepare hydropower and transmission line projects following
international standards and best practices; and (b) improve the readiness of the power
sector agencies for regulatory and institutional reforms. The proposed Project has three
components: (i) Preparation of Hydropower and Transmission Line Investment Projects;
(ii) Studies for Policy Recommendations and Sector Reform; and (iii) Capacity Building
for Safeguard Management and Hydropower Development. More information is provided
below on the components:

 Component A: Preparation of Hydropower and Transmission Line Investment

Projects (IDA Credit $18 million).
 Component B: Studies for Policy Recommendations and Sector Reform (SAWI
Grant US$2.1 million, NEA Counterpart Fund US$ 0.25and IDA Credit US$3.25
million).
 Component C: Capacity Building for Safeguard Management and
Hydropower Development (SAWI Grant US$0.4 million).
C. Environmental and Social Compliance Requirements

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The future infrastructure investments which are the focus of studies under Component A,
as well as development of policy reforms and preparation of integrated basin plans may
have significant environmental and social impacts and/or consequences (positive or
negative). Therefore, environmental and social impact assessments and mitigation plans
will be conducted to fully assess and identify necessary mitigation measures for negative
impacts, as well as measures to enhance positive effects. The assessments will be done in
compliance with and subjected to Nepal‘s own environmental social requirements, laws,
regulations and approval processes, and the international conventions Nepal is a party to
and has ratified. Furthermore, as this Project is proposed to be financed by the World
Bank, the Project is required to meet the requirements of relevant World Bank
environmental and social safeguard policies. The Project is assigned an Environmental
Assessment Category "A" as per World Bank Operational Policy (OP) 4.01. Compliance
with World Bank policies will include ensuring in-depth environmental and social impact
assessment and management planning as well as consultations with all stakeholders for
preparation of detailed engineering design and ESIA of the hydropower and transmission
line investments proposed under Component A. World Bank standards also require
stakeholder consultations and involvement more broadly with regard to the basin
planning and policy reform studies and activities proposed under Components B and C.

D. Environmental and Social Issues of the identified investment projects to be

prepared under Component A

Under Component A, the GoN has proposed the Upper Arun (335 MW) Hydroelectric
Project (UAHEP) and the Ikhuwa Khola (30 MW) Hydropower Project (IKHP), for
preparation studies. The UAHEP is proposed to be located on the Arun River in
Sankhuasabha District of eastern Nepal, while the IKHP site is located on a tributary to
the Arun River approximately 8 km downstream of the proposed UAHEP powerhouse
site. (See Annex A for a map showing the proposed locations of each project.) The IKHP
would be prepared under this Project in tandem with the UAHEP to provide a source of
benefit sharing and also power supply to local communities.

The GoN will also identify an additional priority transmission line project, which has not
yet been identified, for preparation under this Project during the implementation stage of
the proposed Project.

E. List and Scope of Studies and Safeguard Instruments to be Prepared during

Implementation of the Proposed Project.

E.1 During the preparation studies the following safeguard documents will be
prepared for preparation of the Upper Arun (UAHEP) and Ikhuwa Khola (IKHP)
Hydropower Projects:

 Environmental and Social Impact Assessment (ESIA) for both UAHEP and IKHP
 Environmental and Social Management Plan (ESMP)for UAHEP
 Environmental and Social Management Plan (ESMP) for IKHP
 Cumulative Impact Assessment (CIA) of the Arun River Watershed
 Resettlement Policy Framework (RPF)
 Resettlement Action Plan (RAPs)
 Vulnerable and Indigenous Peoples Development Plan

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  Downstream Impacts Management Plan
 Gender Assessment and Action Plan
 Benefit-sharing Action Plan
 Public Health Assessment and Action Plan
 Public Participation and Consultation Plan
 Communication Strategy and Action Plan.
 One Executive Summary of these documents, in English and Nepali
 Dam Safety Plans

E.2 Safeguards Approach for the yet to be identified additional Transmission

project to be prepared through the proposed Project

During implementation of the proposed Project, the GoN may seek the World Bank‘s
concurrence for the Project to finance the required preparation studies and documentation
for a new transmission line. Once the target transmission line investment is identified, the
NEA and the World Bank will screen the proposed Project to determine the applicable
Banks safeguards policies as well as national laws and regulations, and to develop
detailed Terms of Reference for the corresponding required environmental and social
studies in accordance with applicable GoN legal requirements and World Bank safeguard
policies. The impact assessments of the power transmission line will also consider
cumulative impacts of other linear infrastructure such as roads and other transmission
lines, and contribute to coordination among the linear infrastructure planning and
development so as to optimize land-uses, avoid/minimize adverse impacts such as
resettlement footprints, deforestation, landslides/soil erosion and reduce Right of Way
(RoW) expenditures.

E.3 Studies to be prepared for other aspects of the proposed project, covered under
Components B and C.

Under Component B, a number of studies will be financed, which include inter alia,
basin-wide approach for water resource and hydropower development planning for
several major basins in Nepal. This will involve developing an integrated database of
basin-level information and carrying out integrated basin wide planning processes. Smart
meters at consumers‘ premises will also be piloted under this component. The installation
of smart meters is expected to enhance the efficiency and distribution business
management. Some existing consumers will receive new smart energy meters as and
when their existing meters are damaged/ become non-functional. Smart energy meters
will also be installed in some new consumers while giving new connections. In the case
of the existing consumers, NEA will collect the old meters and store them. The damaged
meters have good scrap value, and hence NEA auction them from time to time. The
damaged meters will not be left littered or will not be disposed of haphazardly. These
will not contain haphazard chemicals.

Component C will meanwhile focus on Strategic Environmental and Social Assessment

(SESA) under river basin planning to specifically focus on the social and environmental
aspects and considerations in planning for water resource use, allocation and sustainable
management at a basin scale. This component will further support improving the
environmental and social safeguard management systems and associated capacity
building of key agencies in GoN responsible for power development, especially

57
hydropower. The studies and activities will include policy development, and capacity
building for cumulative/strategic impact assessment, ecological flows, hydropower
resettlement and benefit sharing, gender equity, integrating climate change and disaster
risk management aspects into hydropower planning, basin planning, and developing of
NEA corporate policy for compensation of transmission line ROW. These activities are
expected to have significant environmental and social benefits in the context of
increasing development of the power and especially hydropower sector in Nepal.

F. Institutional and monitoring arrangements

The technical work will be contracted and overseen by the following specific
implementing agencies within GoN - NEA will be responsible for the studies for specific
investments under Component A and Component B; WECS will be responsible for the
studies under Component B & Component C including integrated basin planning and
conducting SESA. The overall Project will be managed by their respective Project
Management Units (PMUs).Component B and C will be further coordinated by a high
level central Project Steering Committee, reporting directly to the Energy Secretary.

G. Public consultations and brief description of the Communications Strategy.

Two rounds of public consultations have been conducted for the Project so far. The first
round consultation was for UAHEP and IKHP, the consultation event was held on the
initial draft TORs for the ESIAs and social planning studies on April 30, 2014 as part of
preparation of this proposed Project, and the TORs (attached as an annex to the full
ESMF) have been updated by NEA to reflect feedback received. Additional consultations
will be held on the draft studies.

The second round of public consultation for the ESMF of the Project was organized by
NEA, DOED and WECS, on December 23, 2014 to consult with the Project stakeholders
outlining the safeguards compliance strategy, requirements and processes across all
project components, and including the detailed Terms of Reference (TORs) for
environmental and social assessments and studies for the UAHEP and IKHP
investments. Similar consultation requirements are expected to apply to the transmission
line investment to be identified and studied under this Project. Similarly, updating of
environmental and social regulations and procedures for hydropower (an activity under
Component C) will include a broad consultation with public sector and civil society
stakeholders at the national level, in addition to private sector, so that inputs from diverse
stakeholders into updating the policies and regulations are considered.

Furthermore, NEA will establish a project-specific website, where information about the
specific investments being prepared under the project (for now covering UAHEP and
IKHP) can be accessed. For now, NEA has been publishing the UAHEP and IKHP
project related information in its corporate website this website will be accessible via:

NEA: http://www.nea.org.np/publications.html

58
Annex A: Map of the Upper Arun and Ikhuwa Khola Site Locations

59
Environmental and Social Impact Assessment and Strategic Environmental and
Social Assessment at the World Bank: The World Bank ―Safeguard Polices‖

OP/BP 4.01: Umbrella policy on Environmental and Social Impact Assessment

Environmental Policies

• OP 4.04 Natural Habitats

• OP 4.09 Pest Management
• OP 4.11 Physical Cultural Resources
• OP 4.36 Forests
• OP 4.37 Safety of Dams

Social Policies

• OP 4.12 Involuntary Resettlement

• OP 4.10 Indigenous Peoples

Legal Policies

• OP 7.50 International Waterways

• OP 7.60 Disputed Areas

Access to Information Policy

Transboundary Context

• OP 4.01:

• ―EA takes into account the natural environment… human health and safety…
social aspects…and transboundary and global environmental aspects‖

• ―Borrower consults project-affected groups and local (NGOs) about the

project‘s environmental aspects and takes their views into account…‖
[including affected groups in other countries in case of projects with
transboundary elements or impacts]

• ―EA considers…obligations of the country pertaining to project activities,

under relevant international environmental treaties and agreements…WB does
not finance project activities that would contravene such country obligations‖

• OP 7.50: For any project on an international waterway…‖ the Bank requires that the
beneficiary state (Borrower) formally notify the other riparians of the proposed
project and its project details‖

Strategic Environmental (and Social) Assessment

• OP 4.01:

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 • Sectoral and Regional EA: ―When the project is likely to have sectoral or
regional impacts, sectoral or regional EA is required.‖

• (March 2011 Clarification from the Board): Addition of Strategic

Environmental and Social Assessment (SESA) to the List of Instruments
Available Under OP 4.01.

• SESA Defined as: ― An instrument that describes analytical and participatory

approaches that aim to integrate environmental and social considerations into
policies, plans and programs and evaluate their inter linkages with economic
considerations.‖

• OP 8.60 (Development Policy Lending): acknowledges the need for upstream

analysis of environmental and social conditions and risks…mentions SEA and
Country Environmental Analysis as tools to carry out such analysis

Approaches to SEA in WB Portfolio

Impact-Centered SEA

• Originate from/extension of ESIA (from project level to plan or program level)

• Often sectoral or regional focus…e.g. energy, transport, water development
programs; land use, regional development and river basin management plans
• Include analysis of cumulative impacts of multiple activities
• Facilitate screening, priority-setting and analysis of alternatives at planning/strategic
level

Policy/Institutional Centered SEA

• Provide upstream analysis to inform policy reform and development strategies

• Facilitate dialogue, negotiation and agreements among multiple stakeholders,
supported by strong analytics
• Analyze institutional frameworks and systems for environmental management and
governance; capacity- building measures
• Approach and influence depends on the policy-making environment

Hybrid (Impact- and Policy-Centered SEA)

Examples: strategic river basin management; REDD+ Readiness; development corridors

Observations from WB Experience with SEA*

• Grassroots stakeholder engagement is essential, but can be hard to mobilize

(agenda too broad; impacts too indirect, intangible)
• SEA numbers increase with grant resources (e.g. SEA pilot program)
• SEA raises awareness about environmental issues within government institutions, but
the extent to which this translates to institutional capacity building varies
• Climate Change issues are stimulating increased interest in SEA, as it clearly calls for

61
 planning at strategic level, with environmental and social factors at the center of most
potential issues
• Making SEA obligatory (EU Directive/Espoo Conv., national law, IFI requirement)
can increase its use but may undermine ownership and influence
• WB support for SEA is most effective in the context of long-term engagement
providing resources and leverage for following up on recommendations

WB and SEA in East Asia and Pacific

• 2005: multiyear program: ―Developing Practice and Capacity of Strategic

Environmental Analysis in East Asia and PacificRegion.‖ Aim = mainstream
environment into sectoral, national, regional development policies, programs, plans
by applying SEA to WB- financed operations, knowledge sharing, capacity building
• Emphasis on impact-centered SEA for large scale infrastructure including those with
transboundary elements and impacts; prioritization and screening of potential projects
in sectoral programs
• Mixed results in using SEA approach to help predict cumulative and induced impacts
• Some policy-centered SEA
• Timing is important factor in influence of impact-centered SEA; less important for
policy-centered SEA (development of programs and projects is time-bound; policy-
making is an ongoing process).

WB and SEA in South Asia

• Many impact-centered SEA to comply with national EIA laws and IFI requirements

Source: Strategic Environmental Assessment in the World Bank: Learning from Recent
Experiences and Challenges. F. Loayza, Ed. World Bank, 2012

WB and SEA in South Asia

• Bhutan was first to have SEA legislation (effective 2002)

• Growing Interest in use of SEA to help develop strategies for managing Climate
Change, Integrated Water Resource Management
• Post 2004 trend of evolution from impact-centered towards more policy-centered
SEA. Likely due to:

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 • WB Policy 8.60 (Development Policy Lending) approved with requirement for
environmental and social analysis
• 2005 WB SEA Pilot Program (grants and specialized assistance)
• Strategic Basin Assessment: hybrid of impact-centered and policy-centered SEA

ILLUSTRATIVE EXAMPLES

Lao PDR: Nam Theun 2 Nepal Arun III HPP

India (Tamil Nadu) Palar River Basin Central Asia South Asia Electricity
Transmission and Trade Project
(Tajikistan, Kyrgyz Rep.,
Afghanistan, Pakistan)

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Lao PDR: Nam Theun 2 Hydroelectric Project

Objective: Hydropower generation; sale of electricity to Thailand

Undertaken in the context of the Project-level EIA:

 Strategic Impact Assessment: Objective: assess sector-wide implications of 22 HP

developments planned over 20 year period (to 2022)
 Cumulative Impact Assessment: Objective: assess impacts of the NT2 project along
with potential impacts of other existing and planned developments in NT2 project area
and Greater Mekong subregion (especially NT1 and NT3) at 5-year and 20-year
horizon

Stakeholder Consultation/Participation Process: 400 meetings during 10 year assessment

process, including all villagers to be relocated, local government authorities, and Lao-based
NGOs; Rounds of international consultations in Japan, Thailand, France, and the United
States.

Outcomes: created open dialogue among stakeholders; contributed to adoption of National

Policy on Env & Social sustainability for the Hydropower sector; creation of Watershed
Management & Protection Authority for NT2; improved understanding of riparian risks of
international river system of Mekong

Lessons: process identified as non-mandatory and results as advisory rather than obligatory:
increased government‘s ability to accept both

NEPAL MEDIUM HYDROPOWER SEA

 Trigger: Controversy over proposed Arun III Hydropower Project, for domestic power
and export to India (project withdrawn by WB; now seeking private investment)
 Objective: Integrate environmental and social considerations into Nepal‘s power sector
planning, by screening and ranking all potential HP projects between 10-300 MW,
within context of a Sectoral EA (financed by WB Power Sector Efficiency Project)
 Process:
 2 stage review of techno-economic and environmental/social parameters of
potential projects and sites;

 Open information sharing and consultation involving government,

professional community, NGOs, general public

 Results:
 Progressive narrowing from 138 feasible projects to 7 ―highest acceptability‖
projects to proceed to feasibility study stage
 Contribute to new Hydropower Policy (criteria for promoting private sector
HP development)
 Recommended energy demand management through phasing out subsidies

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Strategic Basin Assessment for Palar Basin Water Resource Planning (Tamil Nadu
State)
 Palar River: runs for only a few days a year, during monsoon season
 Pilot SEA objective: set a common framework for handling critical water
resource issues in Palar Basin (water availability, water quality, sand mining,
surface/ground water connectivity)
 Process:
 First Phase: scoping, capacity building, issue identification, formation of
vision and guiding principles
 Second Phase: development of Action Plan to address key issues
 Results: additional funding for agriculture/water management; industry upgrades;
improved water regulation; new sand mining regulations; SEA pilot replicated in
63 other TN sub-basins through follow-up project
 Lessons: key stakeholders (including local government) must have ownership so
they play catalytic role; need for early tangible outcomes to engage stakeholders;
stakeholder participation more effective at local/sub-basin level than larger scale
basin-wide level
Central Asia-South Asia Electricity Transmission and Trade Project (CASA 1000)

 To support sustainable electricity trade from Tajikistan and Kyrgyz Republic

to Afghanistan and Pakistan. Components:
 High Voltage power transmission infrastructure, including 1300 km
transmission Overhead Transmission Line (OTL), carrying available excess
electricity from existing hydropower generation in T and KR, to meet
summer demand in A and P;
 Technical Assistance for project implementation and supervision;
 Community Support Programs in each country to help create supportive
environment for project implementation (funding to continue through benefit
sharing during operational phase)

 EIA Approach:
• (SEA) Regional Environmental Assessment of OTL Corridor, covering 4
countries; Resettlement Policy Framework for each country (completed)
• Project-wide Avian Risk Assessment to evaluate risk for migratory birds
and Important Bird Areas (completed)
• Country-specific ESIAs, Environmental and Social Management Plans,
Resettlement Action Plans (based on REA and RPFs); to be done in
conjunction with final technical design)

 Consultations:
• REA disclosed and consultations held in all 4 countries (capital cities and
regional centers); publicly available project website and WB Infoshop;
• Local consultations on RPF, Community Program, and in future on ESIAs,
RAPs
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SEA aims to bring concrete data and analysis on environmental and social issues into the
decision-making process

This can mean policy and regulatory decisions, but policies and laws can sometimes be
ignored or circumvented

SEA (particularly policy-centered SEA) can be most influential when carried out by choice
rather than by decree

Key is to inform and educate and build consensus around the value that SEA brings

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