Tajikistan: Rogun Hydropower Development Project

OBJECTIVE

To enhance national and regional energy security and promote renewable energy, cross-border connectivity, and regional decarbonization by supporting the development of a 3,780 MW hydropower plant in Tajikistan.

DESCRIPTION

A proposed Project supports the construction of a hydropower plant, currently in progress, with a designed generation capacity of 3,780 MW, a 335-meter-high dam, a reservoir area of 170km2, and a total reservoir capacity of 13.3km3. It is located on the Vakhsh River (a tributary of the Amu Darya River), 110 kilometers from the capital city of Dushanbe, upstream of the Nurek Hydropower Plant. The large reservoir can provide seasonal regulation, supplying firm energy during the winter season and reliable electricity to meet growing domestic demands at an affordable cost. Furthermore, it has the potential to export clean energy to Central Asian countries, generating significant export revenue for many years to come. The design of the HPP is assessed for exposure to physical climate risks, and appropriate risk mitigation measures will be incorporated to reduce the plant's vulnerability to climate hazards during construction and especially at the operation stage. The Project has been assessed against European climate policies and confirmed in compliance with the joined MDB Paris Agreement alignment methodology on both climate mitigation (BB1) and climate adaptation (BB2).

Rogun HPP can also act as a balancing plant for Tajikistan and the broader Central Asia region, facilitating easier integration of intermittent renewable energy and contributing to decarbonizing the fossil-fuel-dominated Central Asia power systems.

In Phase 1, AIIB is considering investing USD 200 million in certain components of the Project. Further phases of development will be reviewed at a later stage by reflecting on the progress to date.

ENVIRONMENTAL AND SOCIAL INFORMATION

Environmental and Social Policy and Categorization. The Project will be co-financed with the World Bank (WB) and other development partners. The Project's environmental and social (E&S) risks and impacts have been assessed in accordance with the WB’s Environmental and Social Framework 2018 (WB’s ESF) and relevant E&S Standards (ESSs). To ensure a harmonized approach to addressing E&S aspects of the Project, and as permitted by AIIB’s Environmental and Social Policy (AIIB’s ESP), the WB’s ESF and relevant ESSs will apply to this Project in lieu of AIIB’s ESP. In addition, European regulations and directives on climate risk and climate impact assessment will be applied. The Bank has reviewed WB’s ESF and ESSs and is satisfied that (i) the WB’s ESF and ESSs are consistent with the Bank’s Articles of Agreement and materially consistent with the provisions of AIIB’s ESP and the relevant ESSs and (ii) the monitoring procedures that are in place are appropriate for the Project. The Project has been categorized as Category A as the anticipated E&S risks and impacts are rated high due to significant social impacts related to land acquisition, physical and economic displacements, resettlement impacts, and community disturbance.

Environmental and Social Instruments. The E&S instruments include: 1) Environmental and Social Impact Assessment (ESIA), including the Environmental and Social Management Plan (ESMP) and other associated E&S management plans; 2) an updated Resettlement and Livelihood Restoration Framework (RLRF); 3) Stakeholder Engagement Plan (SEP); 4) Gender Action Plan (GAP); 5) Labor Management Procedures (LMP); and 6) Environmental and Social Commitment Plan (ESCP), as well as a benefit-sharing study and other plans and studies (climate, biodiversity, etc), as required by the Lenders’ ESPs.

Environmental Aspects. During the construction and impoundment period, the environmental challenges encompass risks associated with changes in hydrology and impacts on river flow, biodiversity, quality and morphology; landslides and slope stability; inadequate management of solid, liquid, and hazardous wastes, including asbestos, as well as legacy and construction related pollution and contamination risks; and impacts on natural habitats. Environmental concerns also relate to permanent inundation of the reservoir area, changes in the landscape and terrestrial and aquatic ecosystems, vibrations from blasting tunnels and heavy machinery, dust pollution, etc. During operation, the Project is expected to be significantly exposed to physical climate risks, including but not limited to access to water resources, landslides, and extreme weather events triggered by climate change. Risks are being assessed and factored into Project design and operations scenarios.

Social and Gender Aspects. Adverse social risks and impacts are associated with a larger scale of land acquisition, physical and economic displacements, resettlement, and livelihood restoration. The disclosed RLRF will guide the preparation of Resettlement Action Plan (RAP) 2 and subsequent RAPs acceptable to the lenders to address these risks and impacts. During the construction phase, there are additional social risks related to worker retrenchment, labor management challenges and the establishment of safe and effective work camps during the construction phase. The Project will also affect community health and safety, associated with labor influx, with attendant risks related to social tensions, gender-based violence, sexual exploitation, abuse/sexual harassment (GBV/SEA/SH), transmission of disease, and security issues. The potential impacts and benefits of project activities on women at the community level have been assessed as part of the ESIA, and findings were incorporated into the GAP. The Rogun HPP may have some adverse impacts on tangible and intangible cultural heritage.

Occupational Health and Safety (OHS), Labor, and Working Conditions (LWC). Construction and maintenance activities will present OHS hazards and risks that will be managed through Client and Contractor health and safety management systems and plans aligned with good international practice (GIP). Hazards will include working with live electrical equipment, circuit isolation, working at heights and working in, over or near to water, exposure to hazardous chemicals, electric and magnetic fields, fire hazards, and transportation of heavy equipment. Labor management challenges, including working conditions, labor influx, and establishment of safe and effective work camps, are addressed in the LMP prepared for the Project. Emergency preparedness and response measures are fundamental to managing risks during construction and operations. An Independent Dam Safety Panel of Experts (IPoE) is in place to determine that the Project is designed, constructed and operated safely and accounting for worst-case emergency dam safety scenarios. Emergency Preparedness and Response Plans (EPRPs) will be developed for construction/commissioning and operations in accordance with GIP.

Stakeholder Engagement, Grievance Redress Mechanism, and Information Disclosure. The Borrower has prepared a project-specific Stakeholder Engagement Plan (SEP), which serves as a guide during future stakeholder engagement activities and outlines grievance mechanisms and channels. A multi-tier project-specific grievance redress mechanism (GRM) is being established to handle complaints and issues, with a separate GRM for project workers accessible for all contractors and subcontractors on site. Dedicated communication materials will be developed in the local language to inform interested parties and stakeholders about the grievance redress channels and procedures. The E&S instruments were disclosed in English and local language(s) by the Borrower and WB for a period of 60 calendar days prior to the consideration of AIIB’s financing for approval in line with AIIB's disclosure procedures.

Monitoring and Reporting Arrangements. ES monitoring and reporting arrangements for the Project will be determined among co-financiers during the project appraisal.