UzbekEnergo Muruntau Substation

Location:

Uzbekistan

Project number:

50117

Business sector:

Power and energy

Notice type:

Public

Environmental category:

B

Target board date:

03 Oct 2018

Status:

Signed

PSD disclosed:

13 Jul 2018

Translated version of this PSD: Russian | Uzbek

Project Description

Providision of financing for the reinforcement of the high voltage transmission infrastructure in Uzbekistan. The Bank's financing would go towards the construction of a transmission substation in the Navoi region of central Uzbekistan and related equipment (the "Project").

Project Objectives

The Project is part of a broader grid strengthening programme in the Navoi region which aims at increasing the efficiency and reliability of the transmission system in the area. Overall, the implementation of the Project will help remove existing bottlenecks in supplying electricity to the local industrial, mining and residential settlements while reducing transmission losses.

Transition Impact

Good

The expected transition impact of the Project is two-fold:

Through the Project, the region's power supply reliability will be improved through the associated network upgrades leading to system losses reduction. The Bank is also considering to provide complementary policy support in relation to regulatory framework improvements, including in the areas of system resilience and renewable energy integration.

Additionally, through the Project, the Bank is contemplating engaging in policy dialogue to support corporate governance improvements and project implementation capacity building.

Client Information

Republic of Uzbekistan, on-lending to JSC "Uzbekenergo", a 100% state-owned vertically integrated power utility.

EBRD Finance Summary

US$ 82,500,000.00

Total Project Cost

US$  183,500,000.00

Environmental and Social Summary

The Project is categorised B (ESP 2014). The environmental and social risks associated with the construction of the HV substation are expected to be site specific, readily identifiable and mitigated though implementation of the Environmental and Social Action Plan. The Environmental and Social Due Diligence (ESDD) undertaken by an independent consultant confirmed that the Project can be structured to meet EBRD PRs. As the Project is at the very early stage of the development ESD will work with the Client to ensure ESP requirements are fully met during its implementation.  The Project is in line with GET approach and the GET share is 100%

The substation will be located near Muruntau, in the proximity to a mining site, away from any residential, cultural and important biodiversity areas; no sensitive receptors were identified in the area.  The associated facilities will include 500 kV overhead lines and their connection to the substation.  Whereas not being financed by the EBRD, they are linked to the Project, and were accounted for in the ESDD process.   The Project is at a very early stage of the development and its implementation is scheduled for 2023-2025.

An Initial Environmental and Social Examination (IESE) inclusive of a site visit has been undertaken by ESD staff to make an initial assessment of the Project, confirm categorization and scope further ESDD, which has then been undertaken by an independent Consultant that has reviewed the Company's existing institutional capacity and undertaken a review of the preliminary technical information. The ESDD included a review of both the substation as well as associated power lines.

The main E&S risk associated with the construction and installation of the substation are associated with among others, worker Occupational Health and Safety and ensuring the technology and designs meet good industry practices and best available techniques.  Aspects related to land acquisition and compensation, stakeholder engagement, biodiversity, contractor management, and corporate EHSS management procedures were assessed as well.  The Project will be subject to the National Environmental Impact Assessment (ESIA or OVOS), which will be prepared after the completion of the engineering survey works and in the course of the design documentation development. The associated power line will be subject to separate planning process and are not financed by the Bank, however, the Company will be required to implement the Bank's requirements when developing these lines.

Based on the ESDD an Environmental and Social Action Plan (ESAP) has been developed to structure the Project in line with the EBRD's PRs and address institutional strengthening issues as required. The ESAP includes, inter alia, enhancement of the corporate Environmental, Health & Safety and Social Management Systems, supply chain management and construction safety, implementation of the Stakeholder Engagement and grievance tools, implementation of the Land Acquisition procedures compliant with Bank's policy and others. The ESAP also includes requirements associated with the construction of the associated power lines and need for separate consultation. It will be finally agreed with the Company prior to the Board meeting.

A Non-Technical Summary (NTS) in English | Russian and the Stakeholders Engagement Plan (SEP) have been developed for the Project.  The Bank will monitoring with the Project implementation and assist with institutional capacity building. As required assistance will be provided to the Company in developing the associated ESIA for the new lines.

Technical Cooperation

Not applicable

Company Contact Information

JSC Uzbekenergo: Mr. Anvar Kasymkhodzhaev - PIU Head, NGMK (UE Uzelectroset) Project
grp_mar@mail.ru
+998712366237
+998712334374
www.uzbekenergo.uz
6 Istiklol Street, Tashkent, 100000, Uzbekistan

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