The World Bank Nam Theun 2 Social and Environment Project (P049290)

Transcription

1 Public Disclosure Authorized EAST ASIA AND PACIFIC Lao People's Democratic Republic Environment & Natural Resources Global Practice IBRD/IDA Investment Project Financing FY 2005 Seq No: 10 ARCHIVED on 08-Jan-2018 ISR30886 Implementing Agencies: Ministry of Finance, Nam Theun 2 Power Company, Ministry of Energy and Mines, Government of Laos PDR Public Disclosure Authorized Key Dates Key Project Dates Bank Approval Date:31-Mar-2005 Planned Mid Term Review Date:04-Mar-2010 Original Closing Date:31-Dec-2017 Project Development Objectives Effectiveness Date:10-Jun-2005 Actual Mid-Term Review Date:04-Mar-2010 Revised Closing Date:31-Dec-2017 Public Disclosure Authorized Project Development Objective (from Project Appraisal Document) To generate revenues, through environmentally and socially sustainable development of NT2's hydropower potential, which will be used to finance priority poverty reduction and environmental management programs. Has the Project Development Objective been changed since Board Approval of the Project Objective? No PHRPDODEL Components Name Hydropower Facility:(Cost $13.09 M) Public Disclosure Authorized Management of Environmental and Social Impacts:(Cost $3.09 M) Monitoring and Evaluation Arrangements:(Cost $1.15 M) N/A Overall Ratings Name Previous Rating Current Rating Progress towards achievement of PDO Moderately Satisfactory Moderately Satisfactory Overall Implementation Progress (IP) Moderately Satisfactory Moderately Satisfactory Overall Risk Rating High High 1/8/2018 Page 1 of 15

2 Implementation Status and Key Decisions The Nam Theun 2 (NT2) Hydropower Project began commercial operations on schedule and within budget in Electricity and revenue generation continue to meet or exceed targets. Overall, significant progress has been achieved since the previous Implementation Status Report (ISR) in July 2017, guided by the targeted work programs designed to strengthen environmental and social sustainability of project achievements. The project has met expected standards of World Bank projects related to environmental and social safeguards. Updates on specific work programs are detailed below. Revenue Management Program: NT2 revenues continue to finance priority poverty reduction and environmental management activities and programs such as School Block Grants, the Free Maternal and Child Health Scheme, Health Equity Fund, and the Poverty Reduction Fund (as well as support to Ministries such as Education and Health) through the Revenue Management Program. In the 2017 national budget, the Government of Lao PDR allocated US$66.3 million of NT2 revenues to eligible programs and projects, bringing allocations to more than 100% of net revenues received from the project to date by the Government of Lao PDR. Outstanding audits for FY2013/2014 NT2 Revenue and Expenditure Statements were received by the World Bank, bringing those audits up to date. The audits for the NT2 Revenue and Expenditure Statements for FY15/16 and the Audit Reports of Eligible Programs for FY13/14-15/16 are outstanding, but are expected to be received shortly. In addition, the State Audit Organization (SAO) carried out a self-assessment, and the Government has recently approved the Ministry of Finance s Public Finance Development Strategy, an indication of the growing strength of the public financial system. A major milestone was reached when all NT2-related SAO audits were publicly disclosed on the SAO and Ministry of Finance websites. Lao State Holding Enterprise (LHSE) has also published their audited financial statements on their website. Resettlement on the Nakai Plateau: Eligible resettlement was completed by The NT2 project continues to deliver significant infrastructure, health and education benefits for resettled communities on the plateau. Resettler income restoration has been sustained, with the doubling of income from preproject levels achieved by 97% of resettler households, who are now above the household income target. This percentage has been sustained over the past three years, and incomes now appear to be based on a diverse set of livelihood activities. The remaining poor or vulnerable families who have not achieved the target (3%) either receive support through NTPC-funded social safety net, which will continue through the end of the Concession Agreement or benefit from a special livelihoods program. A living standards survey indicates increased resilience of resettler households to economic hardship through increased savings and possessions, significantly improved social welfare statistics (education, health, public infrastructure), and a more diversified economic base. A Joint Working Group chaired by the Ministry of Energy and Mines, and including the Nam Theun 2 Power Company (NTPC), participating international financial institutions (IFIs) and various levels of the Government of Lao PDR, prepared a plan for closure of the resettlement implementation period for the Nakai Plateau in This plan covers the four livelihood pillars noted in the Concession Agreement (agriculture/livestock, forestry, fisheries, and off-farm incomes), as well as specific concerns related to poor/vulnerable households, ethnic minorities, and gender. Development of the plan started with the recommendations of the POE as set out in their October 2015 report, augmented by involvement of national government departments, NTPC, IFIs, provincial and district governments and villagers, with the continued involvement of the POE. As part of the ongoing support, a new village development planning process, based on the participatory planning model of the Poverty Reduction Fund, was rolled out this past year. The participatory approach prioritizes the voices of the poorest members of the community, and relies on visual aids rather than text for communication purposes. Another significant progress made has been work on the community forestry management plan. Preliminary results and initial indications from ongoing consultations with villagers point to a resettler preference for a division of forest resources (e.g., conservation, grazing zone, plantations, etc.) with virtually no commercial forest use. Community forestry management plan at the hamlet level are currently being prepared. The District of Nakai has demonstrated readiness for handover of planning functions from NTPC with a proposed 3-year transition plan , which would be supported by central Government. There has already been a significant strengthening of the presence and role of the provincial and district governments over the past year, during which local government has significantly increased their capacity and nurtured broader awareness and engagement of villagers in future development priorities, consistent with the national rural development policy. Numerous funds and activities will support resettled communities well into the future. These include a Nam Theun 2 Development Fund (NT2DF) of US$750,000 per year from NTPC to continue support to livelihoods as part of a Medium-Term Development Program (MDTP) through to the end of the concession period in NTPC will also continue funding the Social and Environment Remediation Fund of $410,000 per year for maintenance of village infrastructure. Additional development resources include the Nakai Plateau Agriculture, Livestock and Fisheries project with funding of $300,000 per year to 2022 from Agence Francais de Developpement (AFD), supporting key areas of sustainable income generation. The Downstream Areas: The Downstream Program (DSP), which addresses the impacts of changes in river flow on the Xe Bang Fai River for the people living in the Downstream Areas, was handed over from NTPC to the Government of Lao PDR at the end of December 2012, after NTPC had exceeded its obligations under the Concession Agreement. The DSP Resettlement Implementation Period was closed in 2014 by the Government's Resettlement Committee, following their declaration that livelihoods of the Project Affected People in the Downstream Areas had been restored. 1/8/2018 Page 2 of 15

3 Household consumption levels have risen above pre-project levels and protein levels in diets have been maintained, with increased dietary diversity. Assessment of income levels suggests that many households have met pre-project income levels, however some incomes per capita have fallen due to lower fishing incomes. Livelihood activities were reviewed and livelihood plans prepared in 92 villages that are more affected, to further support restoration and sustainability of incomes. In addition, individual household business plans have been prepared and approved. The Adaptive Management Committee (AMC), which tracks fish catch and erosion data, has been reactivated, chaired by the Provincial Office of Natural Resources and Environment, and resumed regular meetings in November NTPC, the AMC, and provincial and district governments will continue fish catch and erosion monitoring in the Downstream Areas. The Grievance Redress Mechanism is active and has been institutionalized into the government system. The NT2 Watershed Area (Nakai Nam Theun National Protected Area): The NT2 Watershed, including the Nakai-Nam Theun National Protected Area (NNT-NPA), is an environmental offset for the NT2 hydropower project, and a valuable biodiversity area for Southeast Asia. The NNT-NPA is managed by the Watershed Management and Protection Authority (WMPA), which has responsibility for conservation, as well as the livelihoods of the villages located within the protected area. Forest cover has largely been maintained in the protected area; however, pressure on wildlife populations and highvalue timber remains. Progress on institutional reforms at the WMPA over the past six months has been notable, through the formal transfer of responsibility for the WMPA from the provincial government to the central Ministry of Agriculture and Forestry. The WMPA s management is guided by a 5-Year Plan and a Social and Environmental Management Framework and Operational Plan (SEMFOP III). The SEMFOP III utilizes a Community Engagement Framework that emphasizes participatory planning with villages and is sensitive to the different ethnic groups and natural resources in the area. Both the 5-Year Plan and SEMFOP III were approved by the new WMPA Board of Directors chaired by MAF at their first meeting in September The WMPA Board also approved a five-year contract to engage a Consortium of Technical Experts (COTE) for technical assistance and expertise on WMPA management. This innovative model will utilize the specialized expertise of four different NGOs combined under one consortium through a memorandum of understanding. Under the guidance of COTE, four road checkpoints are active again and reservoir patrols have resumed. Strategic staffing remains a challenge and should be done with a long-term perspective, but the WMPA now has established an appropriate institutional base for continued professionalization. Plans are progressing on preparing the area as Lao s first national park. The WMPA will continue to receive funding from NTPC until the end of the Concession Agreement in Risks Systematic Operations Risk-rating Tool Risk Category Rating at Approval Previous Rating Current Rating Political and Governance -- Substantial Substantial Macroeconomic -- Substantial Substantial Sector Strategies and Policies -- Substantial Substantial Technical Design of Project or Program -- Low Low Institutional Capacity for Implementation and Sustainability -- High High Fiduciary -- Substantial Substantial Environment and Social -- High High Stakeholders -- Substantial Substantial Other -- Moderate Moderate Overall -- High High Results Project Development Objective Indicators 1/8/2018 Page 3 of 15

4 Allocation and Utlization of NT2 Revenues for Poverty Reduction and Environmental Management Purposes (Percentage, Custom) Value Comments In the 2017 budget, the GoL allocated slightly over the annual revenues to eligible expenditures. This is due in part because allocations are made at the beginning of the year, in advance of final revenues. Household Income Targets of Resettled Households on Nakai Plateau (Percentage, Custom) Value Date 31-May Apr Dec Jun-2013 Comments Actual (Previous) (including social safety net to vulnerable households). Actual (Current) - 97% with additional support to the remaining 3% in the form of social safety net (vulnerable households) and special programs (poor and at risk households) Watershed Environmental Protection (Text, Custom) Value Unknown Various reviews suggest that habitat and wildlife has degraded, although forest cover has been maintained. However, there is still insufficient data or evaluation of existing data to conclude objectively. Forest cover in the NT2 watershed has largely been maintained; however, pressure on wildlife populations and high-value timber remains. A five-year plan has been approved by a new Board, chaired by the Minister of Agriculture and Forestry Furthermore, a Consortium of Technical Conservation and management of the NT2 watershed results in no further degradation of habitats or declines in populations of threatened species. 1/8/2018 Page 4 of 15

5 Experts (COTE) has been engaged to strengthen the capacity of the WMPA through providing technical assistance and expertise on watershed management. Plans are progressing on preparing the area as Lao s first national park. Generation Capacity of Hydropower constructed or rehabilitated under the project (Megawatt, Custom) Value , , , Date 31-Mar Apr Dec Dec-2017 Generation Capacity of Hydropower constructed under the project (Megawatt, Custom Breakdown) Value , , , Resettled Villages Meeting Village Income Targets (Percentage, Custom) Value Maintenance of pre-project levels of income and protein equivalent in affected villages in the Xe Bang Fai river and the Nam Theun river (Text, Custom) (Text, Custom) 1/8/2018 Page 5 of 15

6 Value The Downstream Socioeconomic Survey implemented by NTPC in 2009 provides baseline values for incomes and consumption of fish and meat in affected villages prior to project impacts Not yet achieved. Declines in fishing income for some households are not yet fully offset Assessment of income levels suggests most households have more than exceeded preproject incomes, although some of the very poor may not have met that average. Sustainable livelihood plans have recently been prepared in 92 villages that are most affected (those downstream and along the rivers), In addition, individual household business plans have been prepared and approved. Protein levels are met. Affected villages in XBF and NT maintain their pre-project levels of income and protein equivalent from alternate livelihood options during the immediate years after COD. Date 31-Mar Apr Dec Dec-2017 Quality of Life in Enclave Villages (villages located in the watershed protected area) (Text, Custom) Value Average household income was estimated to be around 375 USD per household per year. Schools were lacking in most of the villages in the NT2 Watershed and wherever there are schools the level of teaching and facilities were poor. Healthcare services were erratic. Malaria, respiratory diseases and gastrointestinal diseases were common. Infant mortality rates were very high, drinking water rarely boiled and general sanitation very poor. Physical infrastructure has improved and communities have largely continued to derive benefit from the land resources. Discussion and observations in the enclave villages suggest it is likely the affected villages have at least maintained their pre-project levels of income and protein equivalent from alternative livelihood options. Before end- 2017, a household survey of the 13 enclave villages is proposed. Physical infrastructure has improved and communities have largely continued to derive benefit from the land resources. Discussion and observations in the enclave villages suggest it is likely the affected villages have at least maintained their preproject levels of income and protein equivalent from alternative livelihood options. A socio-economic survey of the 13 enclave villages is underway, to be completed in early 2018 and the Consortium of Technical Experts includes an NGO specializing in livelihoods in conservation environments. Improved quality of life for the enclave villages, with higher incomes, better access to basic services and their active involvement in conservation. Date 31-Dec Apr Dec Dec /8/2018 Page 6 of 15

7 Water Quality Adequacy in Nam Theun reservoir and Xe Bang Fai (Text, Custom) Value Water quality corresponds to natural, pre-project conditions Achieved: Water quality is adequate to ensure sufficiency and diversity of fish stock in reservoir, XBF and NT, and also pose no threat to public health. Water quality is adequate to ensure sufficiency and diversity of fish stock in reservoir, XBF and NT, and also pose no threat to public health. Water quality is adequate to ensure sufficiency and diversity of fish stock in reservoir, XBF and NT, and also pose no threat to public health. Overall Comments Intermediate Results Indicators Key wildlife threats such as hunting and further habitat loss having greatly reduced (Yes/No, Custom) Value N N N Y Date 31-Mar Apr Dec Dec-2017 Comments Actual (Current) - N Institutional reforms are now in place to establish a higher and more technologically professional approach to key wildlife threats 1/8/2018 Page 7 of 15

8 Annual average export to Electricite du Laos is not less than 200 GWh (Gigawatt-hour (GWh), Custom) Value Date 01-Jan Apr Apr Dec-2017 Annual average export to Electricity Generating Authority of Thailand is not less than 5,000 GWh (Gigawatt-hour (GWh), Custom) Value , , , Date 31-May Apr Apr Dec-2017 The Watershed Management Protection Authority is able to execute all designated managerial functions in a technically sound, transparent and professional manner. (Yes/No, Custom) Value N N Y Y Comments Actual (Current) - Significant institutional reforms have been instituted, resulting in much stronger management and conservation capacity and senior management oversight, including a doubling of effective human resources from an independent consortium of technical experts drawn from both Lao and international associations. PoE and IMA monitors have expressed cautious optimism after years of concern. The IMA will continue to monitor (as per the CA), particularly to ensure strategic long term re-staffing is completed. 1/8/2018 Page 8 of 15

9 Effectiveness of Lenders' Technical Advisor (Text, Custom) Value 0.00 Moderately Satisfactory Satisfactory Satisfactory Date 30-May Apr Dec Dec-2017 Financial statements (of NT2 revenues) are published (Yes/No, Custom) Value N N Y Y Audit reports for eligible programs (financed with NT2 revenues) are published (annually) (Yes/No, Custom) Value N N Y Y Basic public and social services are provided and improved in all resettlement villages on the Nakai Plateau (Text, Custom) Value Public and social services were scarce and low quality. Achieved: The resettled population continue to benefit from improved and affordable basic services. Ongoing efforts focus on sustaining achievements and reaching closure on outstanding obligations. The resettled population continues to benefit from improved and affordable basic services, as emphasized by the independent Panel of Experts. The resettled population benefit from improved, stable and affordable basic services. 1/8/2018 Page 9 of 15

10 Effectiveness of Monitoring by Independent Expert Panels (Text, Custom) Value 0.00 Effective Effective Dam Safety Review Panel and International Panel of Social and Environmental Experts demonstrate ability to ensure dam safety and accomplishmen t of E&S objectives and CA commitments to income targets of resettlers, watershed preservation, etc. Private Capital Mobilized (Amount(USD), Custom) Value , , , Improved community water points constructed or rehabilitated under the project (Number, Custom) Value /8/2018 Page 10 of 15

11 Vulnerable/marginalized people in proj. area aware of project inv. & benefits (%) (Percentage, Custom) Value Date 31-May Apr Apr Dec-2017 Vulnerable/marginalized people aware of project inv. & benefits - male (Number, Custom Supplement) Value , , , Vulnerable/marginalized people aware of project inv. & benefits - female (Number, Custom Supplement) Value , , , People in the project area - male (number) (Number, Custom Supplement) Value , , , /8/2018 Page 11 of 15

12 People in the project area female (number) (Number, Custom Supplement) Value , , , Roads rehabilitated, Rural (Kilometers, Custom) Value Date 31-May Apr Dec May-2017 Roads constructed, Rural (Kilometers, Custom) Value Target popln with use or ownership rights recorded as a result of the project (Number, Custom) Value , , , /8/2018 Page 12 of 15

13 Areas brought under enhanced biodiversity protection (ha) (Hectare(Ha), Custom) Value , , , Date 31-May Apr Dec Dec-2015 Direct project beneficiaries (Number, Custom) Value , , , Date 31-May Apr Dec Dec-2017 Female beneficiaries (Percentage, Custom Supplement) Value Transmission lines constructed or rehabilitated under the project (Kilometers, Custom) Value /8/2018 Page 13 of 15

14 Transmission lines constructed under the project (Kilometers, Custom Breakdown) Value Reservoir silting (volume loss) (million cubic meters) (Text, Custom) Value Less than 2 Ministry of Finance reports on implementation of revenue management arrangements and holds annual consultation with NT2 partners (Yes/No, Custom) Value N Y Y Y Overall Comments Data on Financial Performance Disbursements (by loan) Project Loan/Credit/TF Status Currency Original Revised Cancelled Disbursed Undisbursed Disbursed P IDA-H1550 Closed USD % Key Dates (by loan) 1/8/2018 Page 14 of 15

15 Project Loan/Credit/TF Status Approval Date Signing Date Effectiveness Date Orig. Closing Date Rev. Closing Date P IDA-H1550 Closed 31-Mar Apr Jun Dec Dec-2017 Cumulative Disbursements Restructuring History There has been no restructuring to date. Related Project(s) P Lao Nam Theun 2 Power Project (former was under PE-P LEN) 1/8/2018 Page 15 of 15