IFC requires that this document is made available through the World Bank InfoShop and to the locally affected community no less than 30 days prior to project consideration by the IFC Board of Directors. The Summary of Project Information (SPI) also provides details of where the ERS has been made available to the locally affected community. The SPI must be sent to World Bank InfoShop no less than 30 days prior to project consideration by the IFC Board of Directors.

This is a Category B project according to IFC’s Procedure for Environmental and Social Review of Projects because a limited number of specific environmental and social impacts may result which can be avoided or mitigated by adhering to generally recognized performance standards, guidelines or design criteria. The review of this project consisted of appraising technical and environmental/social information submitted by the project sponsor and a site visit by IFC staff. The following potential environment, health and safety and social impacts of the projects were analyzed: >> Air quality impacts and cumulative air quality; >> Dredging and site preparation; >> Noise from plant operation; >> Cooling water discharge; >> Discharge of sewage and storm water; >> Spill control; >> Occupational health and safety; and >> Environmental compliance of the existing JEP plant.

The sponsor/project has presented plans to address these impacts to ensure that the proposed project will upon implementation of the specific agreed measures, comply with host country laws and regulations and the World Bank/IFC environment and social policies and guidelines. The information about how these potential impacts will be addressed by the sponsor/project is summarized in the paragraphs that follow. The Jamaican environmental agency, NEPA, requires a full environmental impact assessment (EIA) for the project. JEP commissioned CL Environmental Co. Ltd. of Kingston to prepare the study. URS Corporation, a U.S. environmental consultancy, prepared the air quality impact analysis and assisted with project management. >> Air Quality Impact Analysis for New JEP Plant The proposed plant will have three diesel engine generators that together produce 49.5 MW of electricity. The engine supplier, as part of its contract with JEP, guarantees that the stack emissions will meet the World Bank 1998 Thermal Power Guidelines for plants of less than 50 MW. Analysis for the EIA included several scenarios of air quality dispersion modeling. Key scenarios developed in discussions with IFC staff compared the existing JEP plant on current fuels to the current and new plants on reduced-sulfur fuels, and evaluated the future situation for the existing JEP, JEP II and JPSCo plants on current fuels. The analysis found that sulfur dioxide (SO2) levels are a concern. Under existing conditions, the modeling indicated exceedances of the short-term (1-hour Jamaican and 24-hour Jamaican and WB) criteria, and a small exceedance of the long-term (annual average Jamaican and WB) criteria. The situation would be somewhat worsened by the addition of the new JEP plant. Although the short-term SO2 values are high, the modeling indicates that the highest concentrations would be experienced in the unpopulated hills to the north and northwest of the power plant complex. JEP's consultant utilized the Ozone Limiting Method (OLM) to evaluate the impact of NOx emissions. OLM is an approach approved by the USEPA for evaluating short-term (1-hour) NOx. Using OLM, emissions are compliant with the 1-hour Jamaican standard for NOx for all scenarios. >> Mitigation plan for SO2 emissions: Recognizing that the modeling data represents a conservative scenario and actual monitoring data is expected to present more favorable information, JEP has agreed to ensure that at least 3 ambient air quality monitoring stations are in place for a minimum of six months before the Commercial Operations Date (COD) of JEP II. The information gathered from the ambient monitoring stations shall be the baseline data, which shall be used in conjunction with revised modeling data to give, before start-up, a more accurate projection of the airshed after expansion. If the airshed is projected to exceed the World Bank/Jamaican ambient air quality guidelines/standards then JEP has committed to switch its fuel to a maximum of 1% sulfur unless it can demonstrate that the airshed will meet the World Bank/Jamaican ambient air quality guidelines/standards, or other solutions are identified such that total sulfur dioxide emissions are not worse than what it would have been if there was no expansion. >> Other Impacts from Construction and Operation >> Dredging and site preparation: The project will be a floating barge similar to but smaller than the existing JEP plant. It will be constructed offsite and transported to Jamaica, then towed and moored at a prepared site. Onsite construction will include the building of a jetty and mooring piles, which will involve the filling of about 0.4 ha of land along the shoreline. About 20,000 m3 of dredging will be required to provide a temporary approach channel as well as a permanent mooring basin for the barge. About 0.4 ha of seagrass beds will be disturbed by the dredging. Dredged material will be taken to a designated ocean disposal site. >> Noise from plant operation: The JPSCo plant lies between the existing JEP plant and the major population centers in the site vicinity, and noise from JEP is masked by its location. There are, however, scattered residences to the north of the existing plant that could experience an increase in ambient noise from the new plant. The closest residences are an informal squatter community adjacent to the JPSCo northern plant boundary and about 500 m from the new barge location. Noise analysis performed for the EIA concluded that noise levels are somewhat elevated due to the presence of the two existing plants. However, the addition of the new JEP plant complies with World Bank criteria that noise levels due to the project do not increase more than 3 dB(A). >> Cooling water discharge: The existing JPSCo and JEP plants both utilize seawater for cooling and discharge heated effluent to the adjacent bay. JEP monitors temperatures in the bay and at its discharge pipe; temperatures for JEP measured for the EIA indicated compliance with both NEPA and World Bank criteria. For its new plant, JEP plans to locate the discharge away from its existing outfall about 100 m to the southwest, to limit interaction with the existing plumes. Thermal modeling results indicate that the outfall will be compliant within a very short radius. >> Discharge of sewage and storm water: Similar to the existing JEP barge, the new plant will have an onboard sewage treatment system. A requirement for the system to meet Jamaican and World Bank requirements is included in the EPC contract with the engine supplier The barge will also have oil/water separators to remove oil from stormwater runoff. >> Spill control: The existing JEP plant receives fuel oil by barge from Petrojam at an offshore mooring point located about 1800 m south of the barge. Fuel is then transferred to the barge via an undersea pipeline, and all fuel storage is on the barge. The fuel transfer facilities are inspected annually. They were damaged in March 2003 during a fuel transfer, and were subsequently repaired. JEP has an oil spill contingency plan in place for the existing plant, which will be extended to include the new plant. Spill response equipment is stored onsite. JEP also has a contract in place with a specialized spill response contractor in the event of larger spills. There were two small spills at the plant in 2003; both were remediated. The new barge will receive fuel through the existing transfer facilities, and all fuel will be stored on board. Similar to the existing barge, it will have a double hull design for spill protection. >> Occupational health and safety: JEP has an assigned health and safety officer at the existing plant and uses U.S. OSHA requirements as guidance. In 2003 (most recent information) the company had no lost time accidents. The health and safety program will be extended to the new plant. >> Environmental Compliance of Existing JEP Plant JEP submits an annual environmental report to IFC, as well as detailed reports on air emissions and noise monitoring and inspection reports on the barge hull and oil transfer facilities. For 2003, the most recent information, the project complied with IFC's environmental requirements and had an Environment and Social Risk Rating (ESRR) of B2-Average. >> Conclusions The existing JEP plant has, with minor exceptions, been compliant with Jamaican and World Bank requirements over the period of IFC's loan. Analysis for this appraisal indicates that JEP II plant will also be compliant, both alone and in combination with the existing JEP plant. When cumulative impacts of the two JEP plants are considered together with the existing JPSCo plant, the power complex is substantially compliant with the exception of ambient air quality. JEP has developed a mitigation plan for the key concern, SO2 emissions, such that a workable solution which does not require action by JPSCo will be in place prior to the commercial operation of JEP II. The mitigation plan, if required, will enable the construction of an urgently needed plant, with no net increase in current emissions.

This ERS contains the full environmental and social documentation prepared for the project.

Accordingly, IFC concludes that the proposed project will meet the applicable World Bank/IFC environment and social policies and the environmental, health and safety guidelines upon successful implementation of the agreed mitigation measures.

IFC will evaluate the project's compliance with the applicable environmental and social requirements during the lifetime of the project by reviewing the annual monitoring reports (AMRs) prepared for the project covering ongoing performance of project-specific environmental, health and safety and social activities. Periodic site supervision visits will also be conducted.