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Summary Environmental Impact AssessmentProject Number: 42117

April 2008

Peoples Republic of China: Tianjin IntegratedGasification Combined Cycle Power Plant Project

Environmental Assessment Report

Prepared by [Author(s)][Firm]

[City, Country]

Prepared for [Executing Agency]P d b th H G C f th A i D l t B k (ADB)

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CURRENCY EQUIVALENTS

(as of 27 February 2008)

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

$1.00 = CNY7.2

ABBREVIATIONS

ADB Asian Development BankBOD biochemical oxygen demandDO dissolved oxygenEIA environmental impact assessmentEMP environmental management planEMU environment management unitEPB environmental protection bureauFGD flue gas desulfurizationgce grams coal equivalent

HGC Huaneng Greengen Co.IA implementing agencyIGCC integrated gasification combined cyclePRC Peoples Republic of ChinaSEIA summary environmental impact assessmentTSP total suspended particulatesTPH total petroleum hydrocarbons

WEIGHTS AND MEASURES

C Celsiusha hectareg/kWh grams per kilowatt-hourkg kilogramkm kilometerkV kilovoltkWh kilowatt-hourm meterm3 cubic meterm3/h cubic meters per hourmg/L milligrams per litermm millimeterMW megawatt

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CONTENTS

PageMAPS

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

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

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

A. Soil 8B. Water 9C.

Air Quality 9

D. Noise 11E. Solid Waste and Hazardous Materials 12F. Flora and Fauna 13G. Sociocultural Environment 13H. Induced Impacts 13

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

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

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

IX. CONCLUSION 20APPENDIX

Summary Environmental Management Plan 21

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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

Shanggulin

Panzhuang

Xiditou

Chandian

Jiangwakou

Huangzhuang

Lintingkou

CuihuangkouJiuwuqing

Damengzhuang

Sangzi

Youguzhuang

Huangyanguan

Fengtai

HEBEI

BEIJING

BEIJING

HEBEI

HEBEI

TIANJIN INTEGRATED GASIFICATIONCOMBINED CYCLE POWER PLANT PROJECT

IN THEPEOPLE'S REPUBLIC OF CHINA

0 8 16 24 32

Kilometers

N

Map 1

118 00'Eo

116 00'Eo

41 00'No

41 00'No

o38 30'N

o38 30'N

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B o h a i B a y

Rive

r

Haihe

TANGGU

DISTRICT

DAGU CANNON STATION

CARGO DISTRIBUTION CENTER

PROJECT SITE

TANGGU AIRPORT

PASSENGER CENTER

HARBOR INDUSTRIAL PARK

TIANJIN INTEGRATED GASIFICATION

COMBINED CYCLE POWER PLANT PROJECT

IN THEPEOPLE'S REPUBLIC OF CHINA

Map 2

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.

I. INTRODUCTION

1. This summary environmental impact assessment (SEIA) presents the assessment ofenvironmental issues relating to the development of the Tianjin Integrated GasificationCombined Cycle (IGCC) Power Plant Project (the Project), located in the Harbor Industrial Park,Tanggu District, Tianjin, in the Peoples Republic of China (PRC). The SEIA was prepared inaccordance with the Environmental Assessment Guidelines (2003) and Environment Policy(2002) of the Asian Development Bank (ADB). The Project is classified as category A inaccordance with ADB environmental classification criteria. The Project is the first operationalscale 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 ProtectionResearch Institute. The EIA report was approved by the State EnvironmentalProtection Administration in July 2007.

(ii) Huaneng Greengen Tianjin IGCC Project Feasibility Study Report, completed bythe China Electric Power Engineering Advisor Group Northwest Electric PowerDesign Institute, Xian Thermal Power Research Institute and WuhuanTechnology 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 productionand 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 inJune 2006 and is expected to be completed in 2020. The Harbor Industrial Park EnvironmentalImpact Assessment (EIA 1 was completed by Tianjin Environmental Protection ResearchInstitute in 2006. The proposed 250 MW Project will be the first IGCC demonstration project inthe PRC. The IGCC Project will supply baseload electricity to the local grid and will supplysteam 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 landnewly 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 coalgasifier used is a two-stage dry pulverized coal gasifier. The production processincludes coal grinding and drying, pulverized coal compression and feeding, coalgasification slag removal dust removal wet scrubbing ash flushing water

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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 recoverycapacity of 8.27 t/d);

(v) flaring system (in case of operation failure, syngas can be flared; the torch 80meters [m] high and 900 millimeters [mm] in diameter);

(vi) other items including an air-separation facility with a capacity of 43,497 cubicmeters 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 distributionsystem, emergency ash yard, on-site temporary solid waste yard, oil tank, and oilpump 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 isless than 20 m above sea level. The land occupied by the Project is newly reclaimed. Thebeach slope in the vicinity of the reclamation area is very gentle (1/10001/2000), and the

exposed tidal flats are expansive at low tide.

5. Geology and Soils. The project site is in the Huanghua Depression. The regional faultstructure 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 thesurface Quaternary sediments exceed 60 m in depth. The soils of the reclaimed site have beendredged from nearby shipping channels in the Haihe River. The underlying in-situ soils and thenewly placed dredged soils consist of varying mixtures of clay, silt, and fine sand. The ground

level in the project area is 0.50.8 m above sea level. The area is protected by a seawallrunning the length of the reclaimed area. The water table at the site is relatively shallow. Somesecondary settlement is anticipated at the site as the dredged soils consolidate. Surface topsoil0.20.5 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 accordancewith GB15618-1995 with the exception of cadmium Class III is the lowest level of soil

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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 As0.00.2 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 7.822.0 m 69.87 13.91 1.80 82.15 77.25 43.12 0.03 6.912.5 m 234.87 11.30 1.39 53.10 41.50 197.92 0.02 6.35Class 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 EnvironmentalImpact Assessment Report. Tianjin.

7. Climate. Tianjin has a semi-wet terrestrial monsoon climate. It has a dry winter that lasts

for 156167 days, a short spring lasting 5061 days, a long wet summer of 87103 days, and arelatively dry autumn. The annual rainfall in Tanggu District is about 566 mm, mainly occurringin July and August. The average annual evaporation in the project area is 1,910 mm. Theprevailing wind direction is southwest in the spring, southeast in the summer, southwest in theautumn and northwest in the winter. The annual prevailing wind direction is southwest. Strongwinds often occur in April, with an average wind speed at 5.3 meters per second. The annualaverage wind speed is 4.3 meters per second. The annual average temperature is 12.6oC, withan 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 TangguDistrict by a local environmental monitoring station, the average sulfur dioxide (SO2) andparticulate matter below 10 microns in diameter (PM10) exceeded the class II standard forambient air quality. Class II compliance reportedly occurs for 82.1% of the year.

Table 2: Air Quality in Tanggu District, Tianjin, 20032006 (mg/m3)Item SO2 NO2 PM10 CO

2006 Average 0.07 0.055 0.11 2.42005 Average 0.05 0.033 0.01 1.22004 Average 0.05 0.035 0.11 1.82003 Average 0.04 0.038 0.11 3.0Class II Standard 0.06 0.080 0.10 4.0Class III Standard 0.10 0.120 0.15 6.0WB PPAH

aModerate

Quality 0.08 0.10 0.05WB PPAH

aPoor 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 EnvironmentalImpact 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 inthe areas surrounding the project site. Five samples were taken at each point for each day. The

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Table 5: Near-shore Seawater Quality Monitoring ResultsParameter

(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 5

DO 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 >3

NH3 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 .50

Oil 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 .50

Hg 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 0.500

Cu 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 50

Pb 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 50

Cd 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 10

As 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 .045

Standard

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 theproject 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 notsuitable for industrial or agricultural purposes. Monitoring results from shallow groundwatersamples are shown in Table 6.

Table 6: Groundwater Monitoring Results, January 2006

ItemMonitoring Results

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

(mg/L)pH 7.32 5.59Total Dissolved Solids 47,100 >2,000Chloride 18,100 >350Nitrate (as N) 0.080 >30Nitrite (as N) 0.034 >0.100Fluoride 0.820 >2.000NH3-N 12.030 >0.500Cyanide 0.007 >0.100Cr

6+0.004 >0.100

Hg 0.040 >0.001As 2.700 >0.050Pb 0.400 >0.100Cd 0.050 >0.010

Ni 0.030 >0.100Cu 0.050 >1.500Zn 0.060 >5.000As = arsenic, Cr = chromium, Cu = copper, Hg = mercury, Cd = Cadmium, mg/L =micrograms per liter, N = nitrogen, NH3-N = ammonia, Ni = Nickel, Pb = Lead, pH= aciditymeasure, Zn = zinc.Source: Tianjin Environmental Protection Research Institute. 2006. Environmental ImpactAssessment Report of Land Reclamation Project Tianjin

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

Day 54.6

31 January 2007 Night 45.9Day 57.2

1 m outside the eastboundary

1 February 2007Night 47.7Day 53.8

31 January 2007Night 46.0Day 54.0

1 m outside the southboundary

1 February 2007Night 47.4Day 56.6

31 January 2007Night 47.0Day 55.0

1 m outside the westboundary

1 February 2007 Night 46.9Day 54.2

31 January 2007Night 48.2Day 50.6

1 m outside the northboundary

1 February 2007Night 46.9Day 65.0

Class III (GB3096-93)a

Night 55.0IGCC = 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 theBohai Sea and therefore has no natural ecosystems to support native flora and fauna. Due toclose proximity to the sea and the surface soils being predominantly dredged, surface soils aresaline. No trees, shrubs, or grass grow on the project site. Topsoil will be imported to the site forlandscaping 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 isdominated by reed weed, pi weed and dog-tail weed, and the halophyte vegetation is dominatedby Suaedaa glauca. A survey conducted in 19972000, prior to construction of the HarborIndustrial Park, recorded 107 kinds of birds in the project area, of which 103, or 96%, weremigratory. The bird individuals are mostly pigeon (41%) and wild goose (31%).

15. Aquatic Flora and Fauna. The aquatic flora adjacent to the Harbor Industrial Parkincludes (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 shallowareas.

C. Sociocultural Environment

16. Industrial Park Development. The Harbor Industrial Park is about 10 km from centralTanggu District and 50 km to Tianjin It is about 5 5 km long and 4 12 km wide The first stage

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8 towns and 14 county administrations. The total output of the district was CNY8.98 billion in2005, increasing by 20.7% on the previous year. The farmers average per capita net revenuewas CNY6,555 in 2005, compared with the national average of CNY3,255.

18. Local Resources. Tanggu District has rich oceanic chemical resources. The saltcontent of its seawater is 3.5%, which is suitable for producing salt and extracting more than 90chemical raw materials such as potassium, lithium, and argon. The Bohai Sea covers rich oiland natural gas resources, with the Bohai oilfield being the first offshore oil and gas field in thePRC. The area includes deep geothermal resources. The temperature of the geothermal wateris 65C to 78C.

19. Cultural Sites. There are no cultural, archaeological, or historical sites in the vicinity ofthe site. The nearest cultural site is the 200-year-old Dagu Cannon Station locatedapproximately 6 km away.

IV. ALTERNATIVES

20. Do-Nothing Option. Under the do-nothing alternative, the continued increase in thebaseload demand for the grid would result in power outages and load shedding. Without thisProject, standard coal-fired boilers would have to be constructed to supply heat and steam tothe projects in the industrial park, which could increase the environmental pollution in the projectarea. The do-nothing alternative also neglects the enormous potential benefits available fromIGCC technology to the PRC energy sector.

21. Alternative Energy Supplies. The Project can be replaced by a conventional coal-firedpower plant of 300 MW. Increasing the conventional coal-fired generation capacity would causesignificant environmental harm from increased emissions. Comparison results of the IGCCProject (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 totalemission limits on SO2 and particulate matter. A 300 MW conventional coal-fired power plantwould utilize approximately 493,100 tons coal equivalent annually, compared with the proposedIGCC plants annual consumption of approximately 443,223 tons coal equivalent. Otheralternative energy supplies in Tianjin for power generation include renewable energy resources,oil, and gas. Currently, alternative renewable energy supplies such as wind, solar, and biogascannot compete commercially with baseload coal-fired power generation. Oil and gas for powergeneration are currently uneconomical compared with coal-fired power generation.

Table 8: Comparison of Power Generation Options

EvaluationCriteria

Option I(IGCC power plant)

Option II with FGD(Conventional coal-fired

power plant)

Option III with FGD(Supercritical coal-fired

power plant)Preferred

OptionSO2 emission(g/kWh)

0.13 0.78 0.72I

NO emission 0 07 2 08 1 93

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EvaluationCriteria

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)ConstructionConditions

More construction andhigh requirement forconstructionmanagement

Less construction andnormal requirement ofconstructionmanagement

Less construction andmarginally moremanagement required

II

EconomicIndicators

More investment per unitat about CNY6950/kW;High electricityproduction cost ofCNY0.30/kWh

Lower investment perunit at aboutCNY5,000/kW; lowerelectricity production costof CNY0.20/kWh

Lower investment perunit investment at aboutCNY5,500/kWh; lowerelectricity production costof CNY0.20/kWh

III

OperationalManagement Operationalmanagement is complex Less complexmanagement Less complexmanagement 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 Chinas 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 otherhazardous 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 largelyof uncompacted, recently dredged soils.

23. Mitigation measures will include (i) laying compacted topsoil and re-vegetating exposedsurfaces as quickly as possible after construction at each area is completed, (ii) installingsediment fences for temporary soil stockpiles, and (iii) allowing sediment to settle insedimentation ponds and storm water channels prior to discharge into the Bohai Sea. Soilcontamination will be prevented by (i) installing oil separators at wash-down and refueling areasand (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 andremoved 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 hazardousand other waste will be removed from the site to approved waste disposal sites. There will be noon-site landfill. Impact to soil from construction traffic will be minimized by confining traffic topredetermined 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.

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B. Water

25. Construction Phase. Potential impacts to water resources during the constructionphase include (i) disposal of septic wastewater generated by construction workers, (ii) disposalof equipment wash-down water, and (iii) impacts on water reserves from over extraction. Septicwastewater generated during construction will be collected, treated in on-site facilities, andeither disposed of in the industrial park wastewater treatment facilities or recycled on site. Therewill be no on-site septic seepage disposal system, and no direct discharge of sanitary waste willbe 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 desalinizationplant 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 isthe disposal of operational wastewater. Proposed wastewater disposal methods are presentedin Table 9.

Table 9: Wastewater Disposal

TypeGeneration

(m3/h) Disposal

Recycling system and cooling

tower wastewater

73.79

Chemical water treatment andboiler-operation wastewaterCoal-gasification wastewaterSulfur-recovery system wastewater

21.20

Disposed of at the site wastewater treatment plant andthen at the Harbor Industrial Park wastewater treatmentplant

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

reused as make-up water for cooling recycling waterResidential 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 ProjectEnvironmental Impact Assessment Report. Tianjin.

27. The wastewater released off site to the Harbor Industrial Park wastewater treatmentplant will be treated to class II standard of wastewater discharge (GB8978-1996). Wastewaterfrom the coal-gasification system will be treated to remove NH3-N and cyanide. The temperatureof the wastewater released from the site will be close to ambient temperature. The HarborIndustrial 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 theindustrial 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 fromincreased dust levels from vehicle exhaust construction machinery foundation excavation

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29. Operational Phase. During the operational phase, potential impact to air quality willinclude (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 coalstorage 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 theoperation, emission capture, and cyclone emission control. Mitigation for dust emissions fromcoal transportation include covering the coal transported to the site, washing vehicles, usingwater 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. Emissioncontrol 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 willachieve 99.8%.

(ii) Coal processing system. Bag dust collector, with dust removal efficiency of99.9%.

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

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

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

Table 10: Project Design Emission Data and Standards

Parameter

Design Emissions fromGas Turbine(mg/m

3)

GB13223-2003a

(mg/m3)

GB16297-1996b

Class II(mg/m

3)

World Bankc

(mg/m3)

4.8 400 550 2,000

SO20.055 t/d (normal

operation)0.88 t/d (maximum)

50 t/d

TSP 30 50 50NOx 25 80 125

d

NO2 240mg/m

3= 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 ProjectEnvironmental Impact Assessment Report. Tianjin.

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

Table 11: Summary Dispersion Modeling Results

ParameterSO2

(g/m3)

NO2(g/m

3)

PM10(g/m

3)

H2S(g/m

3)

Maximum additional hourly concentration 5.63 20.07 - 8.28Maximum additional daily concentration 2.31 10.23 0. 71 1.54Maximum 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 55.00 110.00Class II standard

a(annual average) 60.00 80.00 100.00

Class III standardb

(annual average) 100.00 120.00 150.00WB PPAH

bmoderate quality (annual average) 80.00 100.00 50.00

WB PPAHb

poor quality (annual average) 100 150 100H2S = hydrogen sulfide, NO2 = nitrogen dioxide, PM10 = particulate matter below 10 microns. SO2 = sulfur dioxide,g/m

3= micro grams per cubic meter.

aAmbient 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 ProjectEnvironmental Impact Assessment Report. Tianjin.

32. According to World Bank standards (see footnote 2), the baseline air quality (Table 2) inTanggu 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 theIGCC 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 offsetsemissions from the IGCC Project.

D. Noise

33. Construction Phase. During construction, noise will be generated from vehicularmovement, piling, sand and aggregate processing, concrete mixing, excavation machinery, andconstruction. As the residential area nearest to the site is about 5 km away, minimal impact onresidential areas is anticipated. However, there are a number of construction sites near the

project site with many construction workers. Equipment and machinery used for constructionshall strictly conform to PRC and local noise standards. All equipment will be properlymaintained to minimize noise. Noise emissions from the site will meet relevant nationalstandards. Ongoing noise monitoring will be undertaken to ensure compliance. Mitigationmeasures during operation for noise impacts on workers will include standard occupationalhealth and safety practices to relevant PRC standards.

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workers will include standard occupational health and safety practices to relevant PRCstandards.

E. Solid Waste and Hazardous Materials

35. Construction Phase. Solid waste generated during construction will consist ofresidential rubbish and waste building materials. All residential rubbish and waste buildingmaterials will be collected, stored on site in appropriate storage facilities, and transported off siteto approved disposal facilities. No on-site landfills will be developed. Impacts from thetransportation and disposal of spoil may include spillage along access roads, causing hazardsto 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 wastegenerated during construction will be collected and stored separately on site in approvedfacilities. Hazardous waste will be removed from the site to approved hazardous waste disposalfacilities by a licensed waste transportation company.

36. Operational Phase. A summary of the waste generated during the operational periodand the disposal or recycling methods are summarized in Table 12.

Table 12: Waste Generation, Operation Phase

Waste TypeAmount

Generated Disposal or End UseGasifier slag 57,878 t/a Recycled to construction industrySyngas ash 8,602 t/a Used as cement additiveSulfur (solid) 2,070 t/a Sold as raw materialWet scrubber waste 1 t/d Treated by local environmental

service companyWaste coal 2,376 t/a Sold to building material companyWaste activated carbon 15.7 m

3/a Treated by local environmental

service companyCOS hydrolyzation agent 12 m3/a Treated by local environmental

service companyMolecule sieve adsorbent 123 t/aAluminum glue adsorbent 74 t/a

Supplier will be responsible for thetreatment 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. HuanengGreengen 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 approvedhazardous waste disposal facilities by a licensed waste transportation company. The storage,collection, transportation, and disposal of hazardous wastes will be conducted in conformancewith relevant PRC regulations.

38. To ensure disposal options for gasifier slag and syngas ash, the Executing Agencysigned a letter of intent ith (i) Tianjin Zh o Earth ork Engineering Co on 4 December 2006

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other projects in the Harbor Industrial Park, which will bring energy savings and emissionreduction. The successful development of IGCC demonstration projects and the subsequentscaling up will have a number of beneficial environmental impacts, including reduced emissionsfrom coal-fired power plants, benefiting public health and controlling acid rain and greenhousegas emissions. The Project includes the construction of a green generation technology researchand development base, which may develop additional clean coal technologies. The Project willconsider the capture of CO2 in the second stage, which would have significant global warmingbenefits.

VI. ECONOMIC ASSESSMENT

A. Environmental Costs

44. The total project investment is CNY2.16 billion ($300 million). The total environmentalinvestment of the Project is CNY88.25 million ($12.26 million), accounting for 4.1% of the totalproject investment. The environmental investment covers three waste-treatment facilities, anenvironmental monitoring station, accident precautions and emergency measures, and otherfacilities.

Table 13: Estimated Environmental Management Costs

No. Item Costs (000 CNY)

1. Waste gas treatment and emission control facilities 20,3002. Wastewater treatment facilities 9,2503. Slag management facilities 4,0004. Slag storage facilities 9,300

5Environmental monitoring station, including environmentalmonitoring costs

6,750

6.Accident prevention and emergency measures, includingwaste storage facilities

6,150

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

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

B. Environmental Benefits

45. The PRC is the worlds largest coal producer and consumer. It has more than doubledits 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 2,834terawatt-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 inthe PRC has caused major local and global environmental concerns. Two-thirds of PRC citiesdo not meet acceptable air quality standards, acid rain falls on one-third of the country, and the

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by the end 2007. However, the development of the IGCC power plant, which offers higherefficiencies, lower emissions, and the least-cost carbon capture-and-storage option, has beenslow. So far, no industrial-scale IGCC plant is in operation in the PRC.

47. The Project will generate substantial positive environmental benefits through reduced airpollution compared with conventional coal-fired power generation. Avoided air pollution will haveassociated local, regional, and global benefits from reduced increases in particulate matter,sulfur dioxide, nitrogen oxides, carbon dioxide, and other air pollutants. Comparison databetween IGCC and conventional power plants is presented in Table 14.

Table 14: Power Generation Technology Comparison

Parameter IGCC Conventional Supercritical Ultra-SupercriticalOperating Parameters

Thermal Efficiency 48% 38% 41% 45%Coal Consumption (gce/kWhsupplied)

305 345 319 291

Coal Consumption (gce/kWhgenerated)

254 321 297 271

Emission DataTSP (g/kWh generated) 0.01 0.03 0.03 0.03SO2 (g/kWh generated) 0.13 0.78 0.72 0.66Slag (g/kWh generated) 44 108 100 91CO2 (g/kWh generated) 676 854 790 721NOx (g/kWh generated) 0.07 2.08 1.93 1.76CO (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 perkilowatt 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 Peoples Republic of Chinas generation is subcritical. About half of new orders aresupercritical. There are a small number of operational ultra-supercritical but currently no operational IGCC powerplants.

Generating capacity for conventional, critical, and supercritical coal-fired power generation with flue gasdesulfurization is based on 1,000 megawatts, while the IGCC generating capacity is 250 megawatts.Sources: Williams, Robert H. 2001. Development of Chinas coal utilization technology toward zero emission.Princeton: Princeton Environmental Institute; Tianjin Environmental Protection Research Institute. 2007. HuanengGreengen Tianjin IGCC Project Environmental Impact Assessment Report. Tianjin; and International EnergyAgency. 2007. World Energy Outlook.

48. Furthermore, the IGCC Project can provide favorable conditions for CO2 capture, whichmay 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. CO2capture is also feasible for ultra-supercritical coal-fired plants, but there is a higher energy-usepenalty of 1012%, compared with 68% for IGCC. The IGCC Project will also provide steamand heat to other projects in the industrial park, which can save energy and avoid the dischargeof SO2, NOx, slag, dust, and wastewater from facility-specific coal-fired boilers.

VII ENVIRONMENTAL MANAGEMENT AND ENVIRONMENTAL MONITORING PLAN

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manager and at least two technical personnel during the construction period. The constructioncontractor will designate an environmental representative, who will be responsible for theenvironmental management of construction. A project construction supervision company will beengaged, and the company will engage an environmental engineer to supervise environmentalprotection during project construction. During project operation, the project operator willestablish an environmental monitoring station, which will undertake environmental monitoring inaccordance 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 HuanengGreengen Tianjin IGCC Project Environmental Impact Assessment prepared by Tianjin

Environmental Protection Research Institute in 2007. The IA will ensure that the SEIA (includinga summary environmental management plan), EIA report, and plan for controlling soil erosionare included in all contractor bidding documents and operating contracts. The IA will ensure thatthe environmental management plan is updated prior to the commencement of construction,periodically during construction, and prior to the commencement of operation. The EMU will beresponsible for implementing the environmental management plan and plan for controlling soilerosion during project construction and operation. The EMU will ensure that the environmentalmanagement plan is updated periodically during construction and operation.

51. Environmental Monitoring Plan. The EMU will (i) ensure the environmental monitoringplan 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 constructionand operation, (iii) coordinate all environmental monitoring activities, and (iv) submitenvironmental monitoring reports (including physical data) to ADB twice annually duringconstruction and once annually for 2 years after completion of construction. The environmentalmonitoring 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 ofcompliance 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 environmentalsupervision of the Project. Tianjin EPB has a total staff of 100 and is supported by the TianjinEnvironmental Monitoring Station, Environmental Science Research Institute, Environmental

Assessment Center, and Environmental Supervision Agency. In general, the capacity of TianjinEPB 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 hasan established environmental and safety division, which currently has five staff, a number thatwill increase when more projects are constructed in the industrial park.

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Table 15: Environmental Monitoring FrameworkItem Authority Monitoring parameter Monitoring FrequencyConstruction

Air quality Local EPB TSP Monthly testingSolid waste Local EPB

Disposal of hazardous andother waste

Monthly inspection

Operation

Wastewater discharge qualitya

Local WRBpH, SS, CODcr, BOD5, metalsscan, 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, PM10On-line monitoring for flue gasfrom gas turbine

Noise Local EPB Noise at site boundary Twice every year

Air quality at the slag yard Local EPB TSP Twice every yearGround water quality at slag yard Local WRB H2S Twice every yearFiltrate at slag yard (dischargepoint)

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 = nitrogenoxides, pH = acidity measure, PM10 = particulate matter below 10 microns, SO2 = sulfur dioxide; SS = suspendedsolids, 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 ofinitial screening.Tianjin Environmental Protection Research Institute. 2007. Huaneng Greengen Tianjin IGCC Project EnvironmentalImpact 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 theenvironmental information of the IGCC Project on the institute website (www.taes.org) for publicreview 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 theEIA, consisting of random distribution of 130 public consultation questionnaires to affectedresidents and organizations. The survey is considered to have covered a sufficient number ofrespondents in the project area and an acceptable demographic cross section. The majorenvironmental concerns were potential impacts to air pollution and water pollution from theProject. 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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B. Stakeholder Consultation after the Environmental Impact Assessment

55. During 1821 February 2008, a second stakeholder consultation was undertaken todiscuss environmental issues identified in the EIA. The post-EIA stakeholder consultationcomprised the following:

(i) Interviews were conducted on 20 February 2008 with government officials fromTianjin EPB, Tianjin Harbor Industrial Park Management Committee, and expertsfrom the Tianjin Environmental Protection Research Institute. The intervieweesindicated 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 1821 February 2008 with peoplefrom local companies and organizations affected by project construction andoperation. These companies and organizations include Blue Star Chemical Co.,Huabing Water Service Co., and Shengke Wastewater Treatment Co. Theinterviewees considered that the Project is generally environmentally friendly withhigh energy efficiency and low pollution emissions compared with conventionalcoal-fired power projects.

(iii) Questionnaires were distributed to 50 local residents and effected companies.The most important environmental concerns about the Project related to dustcontrol. Specific comments include a requirement for strict control of coal dustand PM10 and the use of low-sulfur coal. The responses to the questionnaire aresummarized in Table 18.

(iv) Discussions were held with nongovernment organizations in Beijing, whoexpressed support for the Project, and whose main concern was related to

potential air pollution.

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

Male 42 84Female 8 16

NumberSurveyed

Total 50 1001830 15 303140 20 404150 11 22

Age Distribution

>50 4 8Junior high school or below 0 0

Senior high school andtechnical secondary school

9 18Education Level

Junior college or above 41 42Worker 6 12Farmer 0 0

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

Satisfied 33 66

Acceptable 15 301

Are you satisfied with the

environmental conditions in theproject area? Not satisfied 2 4

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

2What is the main environmental issuein the project area?

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

Bad smell 0 0

3What are your main environmentalconcerns regarding project

construction?Nothing 10 20Clear 10 20General 37 744

How well did you understand theProject before?

Nothing 3 6Large 0 0Small 31 62Little 14 28

5How much do you think the Projectwill impact the surroundingenvironment?

Nothing 5 10Vegetation 32 64

Noise screening 3 66Which mitigation measures do youprefer? (multiple choice)

Discharge compliance 44 88Large 1 2Small 15 307

What do you think about the impact ofproject construction on thesurrounding landscape? Nothing 34 68

Favorable 50 100Unfavorable 0 08

What do you think about the impact ofthe project construction on localeconomic development? Nothing 0 0

Employment 2 4Enjoying free time 0 0

No impact 45 909

How do you think the Project will

impact your living conditions?(multiple choice)Others 3 6Positive 50 100

10What is your attitude toward theProject? 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 consistsof a 250 MW IGCC power plant located in the Harbor Industrial Park, Tanggu, Tianjin, PRC. Theestimated total investment for the Project is $300 million, and the proposed construction periodis 4 years. The primary function of the Project is to provide baseload electric power generationto the local power grid and provide heat and steam to projects in the industrial park. The Projectwill occupy 20 ha of industrial land, and no resettlement will be required. Major potentialenvironmental impacts from the IGCC Project include (i) soil erosion during construction (ii)

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Appendix

23

ResponsibilityImpact Mitigation Measures Location

Implementation Supervision

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

EIA = environmental impact assessment, EMU = environment management unit, EPB = environmental protection bureau, HGC = Huaneng Greengen Co.,PRC = Peoples 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.