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Environmental Guidelines - Table 9

HYDROPOWER AND WATER RESOURCES MANAGEMENT
(Dams & Reservoirs)

Hydroelectric power projects and other water resource management projects that require construction of dams and reservoirs can provide significant economic benefits and can also serve as a benefit the environment in their capacity as a renewable energy source. The potential adverse environmental effects of these projects, however, can be substantial, particularly as they relate to water quality, the ecology, health impacts, flow regime changes, land use changes, risks from natural hazards and impacts on the regional socioeconomic and socio-cultural framework. The loss of land to reservoirs may require population displacement and resettlement and the loss of archaeological and historical resources. The project planning, site selection, design, construction and operation should identify and mitigate the risks to humans and to the natural habitat, as well as risks due to natural disasters. 

Ex-Im Bank will evaluate hydropower and water resource projects against the relevant host-country and the applicable international guidelines such as those of the World Bank Group. Project participants also are encouraged to address, to the extent practical, relevant principles contained in the Final Report of the World Commission on Dams. The international guidelines for hydropower and water resource projects presented in this Table are condensed from World Bank Group guidelines set forth in the Pollution Prevention and Abatement Handbook (PPAH) and applicable World Bank Group Operational Policies. In accordance with Annex D, large dams, as defined by the International Commission on Large Dams (ICOLD) or water resource projects located in or near a sensitive area, require submission of an Environmental Impact Assessment (Annex E) describing the environmental effects of the project and measures to mitigate the adverse impacts. 

Further information relative to the guidelines presented in this Table are presented in the World Bank Group Operational Policies and Directives. Effluent Standards for upstream point sources presented in this table reflect the effluent parameters and limits presented in the General Environmental Guidelines of the PPAH (1998). The PPAH and World Bank Operational Policies referenced in this Table can be found at: http://www.ifc.org/enviro/EnvSoc/pollution/guidelines.htm. In the case of ambiguity between information in this Table and relevant sections of the PPAH and referenced Operational Policies of the World Bank Group, the guidelines set forth in the PPAH and Operational Policies, in effect as of December 18, 2003, will prevail for purposes of Ex-Im Bank's review and its determination of a project's compliance with the applicable international guidelines of the World Bank Group.

GENERAL GUIDELINES

The extent to which environmental information is required for transactions involving the upgrade of an existing project will be determined on a case-by-case basis. Factors influencing this determination will include the scope of the proposed work, the condition and circumstances of the underlying project and the potential for environmental effects from the project. 

According to the International Commission on Large Dams (ICOLD) and for the purposes of these guidelines, a large dam is defined as having an installed electrical generation capacity in excess of 50 MW, a dam with a height of at least 15m, or a dam between 5 and 15 meters that creates a reservoir impounding a volume in excess of 3 million m3. 

Applications involving the construction of a large dam require submission of an EIA that identifies the project's effects on the environmental and social framework of the affected region, as set forth in Annex E. The EIA should reflect, as applicable, a review of options considered for the dam and associated infrastructure and synergies potentially caused by other important dams planned or existing within the same drainage system. The EIA should contain evidence that a process of meaningful public participation and disclosure within the host country has been implemented. 

International Waterways: In accordance with World Bank Operational Policy 7.50, for all water resource projects that involve the use of, or the potential pollution of, international waterways such as rivers, canals, lakes or similar bodies that form boundaries with or flow through two or more countries, evidence should be provided that: 1) the host country has notified the affected country (or countries) of the proposed project and 2) that the project meets relevant agreements or arrangements between the countries relating to the use and protection of the international waterway.

AIR QUALITY

Air pollution is expected to occur only during construction phases due to dust from handling and transporting materials, and engine exhaust from earthmoving equipment. Functions associated with dam and reservoir construction should minimize air pollutants through the use of good practices. Brush tree burning during site preparation must be avoided to the extent feasible.

WATER USE & QUALITY

Release patterns and flow diversion schemes to the downstream watercourse during construction, reservoir filling and operation phases should be established to satisfy and meet downstream ecosystem and livelihood requirements and other agreed objectives of the project, i.e. navigation, irrigation, etc. The compatibility of water quality for proposed uses within and downstream of the impounded areas should be evaluated taking into account the effects of:

• Water retention time and changes in hydrological regimes
• Changes in water temperature and supply of nutrients 
• Stratification resulting in anaerobic decomposition and its effects on aquatic life
• Gas super saturation and its impact on aquatic life
• Pollution contributed by municipal, agricultural and industrial effluents and leachate resulting from landfill sites
• Potential contamination of groundwater resources
• Quality and Quantity of projected sediment accumulation in the reservoir

Point source discharges into the reservoir will be treated to meet the following limits as listed in the General Guidelines Table of the Pollution Prevention and Abatement Handbook (PPAH): 

Formulations containing chromates should be avoided in water treatment processes. For projects with the potential of causing erosion and sedimentation impacts to receiving waters, a plan should be prepared and implemented to ensure that the concentration of suspended solids in discharges from project areas will be controlled to adequately minimize impacts on water quality and aquatic life.

Watershed Management Plan
Where applicable, a watershed management plan should be prepared to describe the methods for maintaining or improving the existing watershed and managing future land use changes within the watershed to avoid the introduction of factors that might create additional negative impacts (i.e. erosion, untreated discharges, induced access, etc.)

WASTE MANAGEMENT

Throughout all phases of a project involving a dam or reservoir, proper management and disposal of waste materials will be implemented so as to avoid unnecessary soil, water and groundwater contamination. Prior to impounding the reservoir area, an action plan will be prepared addressing the management of waste in existing landfills in the proximity of the reservoir. Recycling or reclamation of solid and liquid non-hazardous wastes and materials is encouraged where possible. If the above management is not practical, wastes must be disposed of in an environmentally safe manner that incorporates best management practices, as well as in compliance with applicable local laws and regulations. Projects that include the handling, storage and disposal of hazardous materials must include a management plan demonstrating that the contamination of soil, groundwater and surface waters is minimized to the extent possible and remediated as necessary. 

NATURAL HAZARDS

New dams and associated works should be sited, designed, constructed, operated and maintained on the basis of appropriate safety measures. A feasibility study for the proposed project will identify areas of concern and the appropriate design measures taken to address the risks of the project on its area of influence (dam site, watersheds contributing to project areas and downstream areas as well as ancillary aspects required by project and host areas). Depending on the degree of complexity, location and size of the project, the Bank may require that separate technical studies be prepared to evaluate seismicity of the zone, and other critical safety related issues. Necessary recommendations and upgrades must be included in these studies. Projects should follow the guidelines established in the World Bank Safeguard Policy OP 4.37, Dam Safety.

NOISE

Blasting will be minimized or avoided in areas inhabited by sensitive species so as to prevent harm to animal life.

NATURAL HABITATS

Project site selection should take into account and minimize to the extent practical impacts to the ecology within the project's area of influence. Care to avoid/minimize impacts should be demonstrated, particularly in the case of important and critical natural habitats as defined in World Bank Operational Policy 4.04; Natural Habitats. For projects situated in sensitive locations, the EIA should address the risk of direct and indirect impacts on the environment of the project's area of influence as well as measures to mitigate these impacts. Guidance in protecting natural habitats is provided in OP 4.04. For projects involving the construction of large dams, particular attention should be given to the following:

• Baseline ecosystem studies and information in the EIA identifying areas where modifications of water flow and quality will significantly impact associated ecosystems.
• Measures to prevent or mitigate the loss of habitats of threatened and endangered (animal and vegetative) aquatic and terrestrial species within the area of influence of the project. 
• The effects resulting from downstream hydrology changes and the impacts caused on ecosystems (marshes, lagoons, lakes, estuaries, etc.) must be addressed and mitigated.
• Measures to mitigate the potential for upstream erosion and landslides, sedimentation effects and downstream scouring of the watercourse resulting in morphological changes of the river, estuary or coastal areas. 

RESETTLEMENT, INDIGENOUS PEOPLES, CULTURAL PROPERTY (When Applicable)

Project site selection should take into account and minimize to the extent practical adverse impacts to indigenous and other vulnerable people within the project's area of influence resulting from involuntary resettlement, land use changes, population influx due to increased access caused by the project, or effects on culturally significant artifacts or sites.

Where large resettlement or relocation becomes unavoidable, a Resettlement Action Plan (RAP) must be developed and implemented in compliance with host-country laws and international guidelines such as those of the World Bank Group. (See Operational Safeguard Policies of the World Bank: OP 4.20, Indigenous Peoples; OP 4.11, Safeguarding Cultural Property and OD 4.30, Involuntary Resettlement). 

ENVIRONMENTAL MANAGEMENT AND MONITORING (When Applicable)

For Category A projects, an environmental management and monitoring plan (EMP), as described in Annex E, should be provided that sets forth: (a) the measures to be taken during the implementation and operation of a project to eliminate or offset adverse environmental impacts, or reduce them to acceptable levels; (b) the actions needed to implement these measures; and (c) actions required to assess the effectiveness of the mitigation measures employed. Specific requirements of the EMP will be made on a case-by-case basis according to the project's environmental sensitivities. The World Bank Operational Policy 4.01 provides guidance with respect to the preparation of an EMP.