The World Bank Renewable Energy Development Project – Phase 2 (P509365) Environmental and Social Review Summary Concept Stage For Public Disclosure (ESRS Concept Stage) World Bank Performance Standards (OP 4.03) Date Prepared: February 10, 2025 DATE Feb 10, 2025 Page 1 of 10 The World Bank Renewable Energy Development Project – Phase 2 (P509365) BASIC INFORMATION A. Basic Project Data Country Region Project ID Parent Project ID (if any) Kyrgyz Republic Europe and Central Asia P509365 P178286 Project Name Renewable Energy Development Project – Phase 2 Practice Area (Lead) Financing Instrument Estimated Appraisal Date Estimated Board Date Energy & Extractives Investment Project 24-Oct-2025 28-Nov-2025 Financing - Guarantees Borrower(s) Implementing Agency(ies) Kyrgyz Republic Ministry of Energy, National Electricity Grid of Kyrgyzstan Open Joint Stock Company For Public Disclosure Proposed Development Objective(s) To increase solar power generation through private sector participation. Financing (in USD Million) Amount Total Debt 80.00 Total Equity 40.00 Trust Funds 0.50 Private Sector Equity 39.50 IDA Guarantees 8.00 Total Project Cost 128.00 DATE Feb 10, 2025 Page 2 of 10 The World Bank Renewable Energy Development Project – Phase 2 (P509365) B. Is the project being prepared in a Situation of Urgent Need of Assistance or Capacity Constraints, as per Bank IPF Policy, para. 12? No C. Summary Description of Proposed Project The proposed KRED Phase 2 project consists of the development of the first utility-scale solar PV (estimated at 100-120 MW) Independent Power Producer (IPP) in the Kyrgyz Republic to be implemented through a competitive tendering process for the selection of a private investor (the “Private Entity”). The project will include the enhancement of an existing 5 km road, and the development of a new 12km transmission line. The project provides an IDA payment guarantee backing up payment obligations by the power off-taker, and grant resources for technical assistance activities. The proposed solar PV plant will be located in Kongorchok, Naryn Province (96 km southeast of Bishkek), Kyrgyz Republic. Since the solar plant is proposed to be designed, constructed, operated and owned by the Private Entity as a private sector activity, OP4.03 World Bank Performance Standards are being applied to the operation. For Public Disclosure D. Scope of application of Performance Standards (PSs) The Private Entity selected through the tendering process will be required to have an Environmental and Social Management System (ESMS) in place to manage the anticipated E&S risks in line with requirements of the Performance Standards. The Private Entity will be required to establish an appropriate monitoring framework and demonstrate sufficient organizational capacity to facilitate alignment with the PSs. The planned solar PV plant is not expected to trigger the World Bank’s Operational Policies on Projects on International Waterways (OP 7.50) or Projects in Disputed Areas (OP 7.60). Based on available information, the solar project may have impacts which must be managed in a manner consistent with the PS identified in Table 3. Table 3: Performance Standards that might apply Performance Standards Yes No PS 1: Assessment and Management of Environmental and Social Risks and Impacts √ PS 2: Labor and Working Conditions √ PS 3: Resource Efficiency and Pollution Prevention √ PS 4: Community Health, Safety, and Security √ PS 5: Land Acquisition and Involuntary Resettlement √ PS 6: Biodiversity Conservation and Sustainable Management of Living Natural Resources √ PS 7: Indigenous Peoples √ PS 8: Cultural Heritage √ DATE Feb 10, 2025 Page 3 of 10 The World Bank Renewable Energy Development Project – Phase 2 (P509365) E. Environmental and Social Overview E.1. Project location(s) and salient characteristics relevant to the ES assessment The solar PV will be in Kongorchok, Naryn Province (96 km southeast of Bishkek). The site is state-owned land with an estimated usable area of 330 ha and a solar radiation of 1,678 kWh/m2 per year. The land is currently used for grazing and as a path to take cattle into the hill pastures for summer grazing. A small canal, beyond the southern edge of the site, conveying meltwater from hills, is part of a minor canal system for irrigation and other community needs. Burial mounds have been found close to the proposed site, and these areas have been excluded from the development site, reducing the area available for the park. The nearest water body, Orto Tokoy Reservoir, and the Issyk Kul Important Bird Area are more than 15 km and 45 km from the site, respectively. The solar PV power plant will be connected to the Kemim-Ak-Kyia substation by a 220 kV transmission line (located around 12 km from the point of connection). The transmission line, which will be constructed by the Private Entity and transferred to NEGK (the local national electric distribution company) at commercial operation date, is considered part of the project. About 5 km of the access road to the site may require minimal upgrades; these improvements are also part of the scope of the project and will be undertaken by the Private Entity. For Public Disclosure Construction activities may pose risks related to the presence of labor influx, including the potential for risks related to sexual harassment (SH) and sexual exploitation and abuse (SEA). The other potential issue pertains to livelihood impacts due to disturbance to the seasonal stream traversing the proposed solar park site along the southern perimeter. This stream leads to a small man-made pondage/water storage site from which a small network of canals are used for irrigation and other purposes by the local community; impacts to seasonal streams will be assessed during the ESIA process, and possible mitigation measures (such as rerouting of the stream canal) addressed during the implementation phase. E. 2. Client’s Organizational Capacity/Borrower’s Institutional Capacity MoE is responsible for managing the entire multiphase program, with the national transmission company NEGK providing full technical support, as appropriate, for the connection from the plant to the national transmission network. NEGK is implementing CASA-1000, a Bank-financed project and is staffed with environmental and social specialists. A Project Management Office (PMO) in the MoE has already been established for KRED Project as part of Phase 1 and is functioning with one environmental and one social specialist. An Occupational Health and Safety Specialist is expected to be onboard by end-February 2025. The solar PV power plant, i.e. the Phase 2 of the multiphase program, will be developed and implemented by the Private Entity. The Power Purchase Agreement (PPA) will require the Private Entity to develop and operate the solar plant in accordance with the Performance Standards. As per the PPA, the Private Entity will be responsible for the identifying, assessing and managing environmental and social risks and impacts, and nominating appropriate E&S functions for the development and implementation of the project. DATE Feb 10, 2025 Page 4 of 10 The World Bank Renewable Energy Development Project – Phase 2 (P509365) The MOE and NEGK have ensured that relevant E&S requirements are incorporated into tender documents and contracts with the Private Entity. MOE and NEGK will also be responsible for supervision of the E&S performance during implementation. However, neither the NEGK nor the PMO specialists have previous experience of supervising private sector Design- Build-Operate contracting arrangements or use of the Performance Standards. The proposed grant will provide the PMO with capacity building and technical assistance, to support the implementation of the relevant PSs under OP4.03. Once completed, the Bank will support the PMO to review the ESMS and the ESIA prepared by the Private Entity, including ESMP documentation. II. SCREENING OF POTENTIAL ENVIRONMENTAL AND SOCIAL (ES) RISKS AND IMPACTS A. Environmental and Social Categorization - CATEGORY B B. Environmental and Social Risk Classification – Moderate For Public Disclosure DATE Feb 10, 2025 Page 5 of 10 The World Bank Renewable Energy Development Project – Phase 2 (P509365) III. APPLICABLE STANDARDS A. Performance Standards PS1 Assessment and Management of Environmental and Social Risks and Impacts The activities to be undertaken by the competitively selected Private Entity, comprising civil works, installation of electrical equipment at solar power plant the access road, and the transmission line, can potentially generate some adverse E&S impacts and risks. These include land conversion, air, soil, water and noise pollution, waste generation, health, and labor safety issues. Adverse impacts are expected to be within a limited project area and temporary, except for the change in land-use. Qualification criteria for the selection of the Private Entity include having an Environmental and Social Management System (ESMS). Per the requirements of OP4.03, the Bank will review the ESMS of the selected Private Entity and confirm that there is sufficient capacity to assess and manage the potential risks and impacts of the Project. The ESIA will be undertaken by the Private Entity, and it will build on the findings of the environmental and social scoping report prepared in August 2024 in support of the tendering process. The ESIA process is a requirement of the PPA and will be made available prior to project appraisal. There is also a parallel national environmental consenting process, which may require an Environmental Impact Assessment (EIA) according to national requirements. The ESIA will also include an Environmental and Social Management Plan (ESMP), which will include measures in line with those described under respective PSs below. For Public Disclosure PS 2 Labor and Working Conditions Since this is a ground mounted solar park with few moving parts and need for vehicles to move fuel and chemicals, risks related to injury are limited. However, temporary influx of labor is expected. The key OHS concerns are related to electrical hazards for all electric works and working at height in relation to the TL deployment. The Labor Management Procedures (LMP) to be prepared as part of the ESMS and ESMP by the Private Entity will stipulate safe working conditions and procedures (including OHS and measures to address SEA and SH risks), workforce protection measures and a labor grievance mechanism. The PMO, with the support of the Bank, will support the Private Entity in the preparation of LMP as well as an Occupational Health and Safety Plan to meet the requirements of PS 2 and the World Bank Group Environmental Health and Safety (EHS) Guidelines. The LMP will also include guidance on addressing labor influx, establishing safe and effective work camps and measures to address SEA/SH risks and prevention of any form of child and forced labor risks. To manage potential risks of forced and child labor in the supply chain, the Private Entity will undertake market analysis to identify the possible suppliers of solar panels to the project and the procurement contracts include provisions relating to forced or child labor. DATE Feb 10, 2025 Page 6 of 10 The World Bank Renewable Energy Development Project – Phase 2 (P509365) PS 3 Resource Efficiency and Pollution Prevention and Management Relevant risks and impacts may include pollution of air, water, and land quality due to discharges during construction or spillage. There could be issues of handling hazardous material, and some waste could also be hazardous. Reduction in the emission of Green House Gases compared to use of fossil fuel for the same amount of energy is expected to be a net positive impact. The private company will identify and implement measures as part of the ESMP to comply with existing requirements for managing risks, including collection, storage, transportation, and disposal of hazardous waste; both the national legislation and the Good International Industry Practice (GIIP) defined in the relevant WB EHS Guidelines will be referred. Efficient water use in construction works and operation of the project camp will be also included in the ESMP. Suitability of minimizing use of water during operation - for cleaning the solar panels – and where required, its treatment before discharge will be included as part of the ESMP. PS 4 Community Health and Safety Impacts on community safety could arise during the construction phase from the movement of vehicles. Inadvertent discharge from the site, or blockage of the drain at the edge of the site could also create issues for downstream user communities. Since most of the local population is dependent on the existing minor canal system for irrigation and other needs, the ESMP will include plans for the avoidance and / or restoration of water streams by the Private Entity to avoid any adverse impacts on communities. Measures for other potential community impacts like those from labor influx, SEA/SH, etc. will be addressed in the ESMP. For Public Disclosure PS 5 Land Acquisition, Restrictions on Land Use and Involuntary Resettlement The project will be primarily located on vacant state-owned land; which, for the purpose of the project, will be transferred to the Green Energy Fund (GEF), a national entity established by the Government of the KR. In turn, the Project Entity will lease the land from the GEF. While vacant, the land is used for grazing cattle, so potential livelihood impacts will need to be considered in the ESIA. lMinor land acquisition of private land and land use restriction may be necessary to extend the right of way for the existing 5 km access road and to establish the sanitary zone along the transmission line. If needed, any land acquisition will be undertaken by the Private Entity consistent with the national legislation and Performance Standard 5. The impact on private lands is anticipated to be minimal, affecting only 4 or 5 plots; no physical structures are affected, no physical displacement is expected and very limited livelihood impacts are anticipated. Aspects to be assessed as part of the ESIA include: (i) extent of land acquisition required and potential economic losses and compensation for local farmers (ii) impacts on water streams, availability of irrigation water and resultant impacts on cultivated lands; and (iii) social exclusion risks, especially against vulnerable and disadvantaged groups. If these risks are confirmed to be material, they will be addressed in a project’s Resettlement Action Plan (RAP), to be developed by the Private Entity. The RAP will include measures to ensure Project Affected Persons (PAPs) have access to project benefits and are not disproportionately and negatively impacted by the Project. The RAP will be developed by the Private Entity under the guidance of the PMO and need-based assistance from NEGK. The RAP will also be reviewed by the Bank to confirm consistency with PS 5. DATE Feb 10, 2025 Page 7 of 10 The World Bank Renewable Energy Development Project – Phase 2 (P509365) PS 6 Biodiversity Conservation and Sustainable Management of Living Natural Resources Although Issyk-kul's significant bird area is more than 45 km away, the ESIA will assess how project activities, in particular the overhead transmission line, intersect with the Asian Flyway or other important biodiversity aspects. The Private Entity must evaluate potential impacts and, if needed, suggest mitigation measures through a Biodiversity Management Plan, such as installing bird diverters on the transmission lines. PS 7 Indigenous Peoples/Sub-Saharan African Historically Underserved Traditional Local Communities There is no social group in the Kyrgyz Republic that is considered as Indigenous Peoples. PS 8 Cultural Heritage Burial mounds have been found close to the proposed site, and therefore, the site boundaries have been drawn to exclude these areas reducing the space available for the park. During the ESIA, the site will be further examined to confirm the potential risks and impacts and inform management actions to handle such cultural assets. The ESMP will also include ‘chance finds’ procedures. For Public Disclosure C. Legal Operational Policies that Apply OP 7.50 Projects on International Waterways No Not Applicable OP 7.60 Projects in Disputed Areas No Not Applicable III. WORLD BANK ENVIRONMENTAL AND SOCIAL DUE DILIGENCE DATE Feb 10, 2025 Page 8 of 10 The World Bank Renewable Energy Development Project – Phase 2 (P509365) Other Relevant Project Risks A. Is a common approach being considered? No B. Proposed Measures, Actions and Timing (Borrower’s commitments) Actions to be completed prior to Project Appraisal: The Private Entity selected from the tendering process will be required to have an Environmental and Social Management System (ESMS) that will be implemented to manage the anticipated E&S risks in line with requirements of OP 4.03 World Bank Performance Standards. to the Private Entity will prepare and implement the following instruments for the proposed solar PV plant, to be approved by the World Bank prior to appraisal: (i) an Environmental and Social Impact Assessment (ESIA) and Management Plan (ESMP); (ii) a Resettlement Action Plan (RAP) or a Land Acquisition and Livelihood Restoration Plan (LALRP) (if required, based on final project layout and findings of ESIA process); (iii) Labor Management Procedures (LMP) for the project, including provisions to avoid child and forced labor in the solar supply chain; (iv) a Grievance Redress Mechanism (GRM); (v) and a Stakeholder Engagement Plan (SEP). For Public Disclosure Possible issues to be addressed in the Client Environmental and Social Action Plan (ESAP): To be determined during E&S due diligence. C. Timing 1. Based on the IFC Transaction Advisory studies, the team is targeting July 2025 as the DATE: July 2025 time for reviewing the ESMS of the selected Private Entity. An A-ESRS with an Environmental and Social Action Plan (ESAP) based on the review of the ESMS, and the site-specific studies completed by then will be prepared at that time. IV. WORLD BANK ES OVERSIGHT Corporate advice/oversight will be provided by an Environmental and Social No Standards Adviser (ESSA) during project preparation V. CONTACT POINTS DATE Feb 10, 2025 Page 9 of 10 The World Bank Renewable Energy Development Project – Phase 2 (P509365) World Bank Federico Querio, Senior Energy Specialist Fida Rana, Senior Infrastructure Finance Specialist Client/Recipient Kyrgyz Republic Implementing Agencies Ministry of Energy, National Electricity Grid of Kyrgyzstan Open Joint Stock Company VI. FOR MORE INFORMATION CONTACT The World Bank 1818 H Street, NW Washington, D.C. 20433 For Public Disclosure Telephone: (202) 473-1000 Web: http://www.worldbank.org/projects VII. APPROVAL Task Team Leader(s): Federico Querio, Senior Energy Specialist 13 February 2025 Fida Rana, Senior Infrastructure Finance Specialist 13 February 2025 MIGA Manager, Sustainability, Industries: Kate Wallace 13 February 2025 Practice Manager: Stephanie Gil 13 February 2025 Satheesh Sundararajan 13 February 2025 Country Director: Tatiana Proskuryakova 13 February 2025 DATE Feb 10, 2025 Page 10 of 10