The sponsor has presented plans to address these impacts to ensure that the proposed project will upon implementation of the specific agreed measures, comply with the environmental and social requirements - the host country laws and regulations and the World Bank/IFC environment and social policies and the environmental, health and safety guidelines. The information about how these potential impacts will be addressed by the sponsor/project is summarized in the paragraphs that follow.
- Corporate management system for environmental performance:
Anhui Conch is rapidly expanding and most of its technical expertise has been gained through acquisition of existing cement production companies. Although the company has substantial technical/environmental expertise, this is currently concentrated within each of its subsidiary operations. The company itself has a very lean central management structure. IFC will require that the company establish a centralized capacity for environmental monitoring and reporting in the form of an Environmental Management System (EMS). An EMS will allow the Anhui Conch management to continuously monitor the performance of its subsidiaries, and will enable the company to ensure continuous compliance of all subsidiaries with relevant environmental, health and safety requirements.
- Land Acquisition, Compensation and Resettlement:
The company’s expansion of production capacity will be through the construction of additional clinker lines and/or grinding facilities within existing plants, greenfield expansion of those existing plants and the construction of new greenfield plants. Land use rights to greenfield sites are obtained from local authorities who assume all responsibility for managing the land acquisition process including payments of compensation and resettlement of people who are affected. The land acquisition processes being undertaken on behalf of the company by local authorities for both an expansion project and a greenfield project in Anhui province are generally in compliance with the World Bank Group policy on Involuntary Resettlement. However, there is considerable variation in the local government approaches to land acquisition, compensation and resettlement from province to province. For this reason, IFC will require the company to provide details on the social impacts of any expansion projects undertaken with IFC financing, and to monitor the payment of land compensation, physical resettlement and rehabilitation of affected people to ensure that the objectives of the Involuntary Resettlement policy are met.
- Quarry operations and rehabilitation:
Anhui Conch’s clinker production facilities are typically located near large uninhabited, barren limestone formations appearing as consecutive outcrops. Limestone mining concessions are designed to remove a full section of the outcrop leaving the hill as original formation as flat land once the quarry is exhausted. The company is committed to the rehabilitation of exhausted quarries and land reclamation/re-vegetation activities are included in each subsidiary’s business plans. For all new quarries, reclamation plans will be prepared for the regulating authorities in advance of operation in accordance with the latest Chinese legislation.
- Environmental performance of existing clinker kilns and cement plants:
Air emission data was collected for all Anhui Conch’s main clinker operations and compared with both local regulations and World Bank guidelines. The analysis shows that the dust emissions for all units are kept below the national limit of 100 mg/NM3 (accepted for existing operations by the World Bank guidelines), with the large majority of units emitting below the 50 mg/NM3 World Bank guideline for new cement operations. This analysis yields an average of 33 mg/NM3 dust emission from all of the company’s operations. The NOx emissions are in the range of 184-719 mg/NM3, with an average of 477 mg/NM3. These levels are well within the local regulation of 800 mg/NM3, and, on average, fall below the World Bank guidelines of 600 mg/NM3. Anhui Conch is carrying out research on NOx emission reduction and it is expected that this research will allow all existing plants to reduce emissions below the 600 mg/NM3 limit in due course. All the company’s plants have very low SO2 emissions (maximum 67 mg/NM3, average 19 mg/NM3) compared to the latest (January 1, 2005) Chinese regulation of 200 mg/NM3 and the World Bank guidelines of 400 mg/NM3.
Anhui Conch continuously monitors NOx and SO2 of all clinker units as part of their process controls but does not monitor dust emissions on the same schedule. According to a new Chinese regulation for cement plants, these three parameters are to be continuously monitored at all plants by the end of 2009. The company has agreed with IFC to install monitoring equipment according to a phased implementation plan, requiring 25% of its plants to be upgraded every year between 2006 and 2009 until full compliance with government requirements has been met.
All cement grinding operations are equipped with bag filters and comply fully with the local emissions regulations, i.e., 50 mg dust/NM3 for existing plants and 30 mg dust/NM3 for new plants. The comparable World Bank guideline is 50 mg dust/NM3.
The company’s operations generate limited amounts of process wastewater due to its predominant use of dry technologies. The wastewater is, in general, treated on site and is used for the irrigation of greenery in and around plant sites.
- Environmental performance of future expansions:
The Chinese regulatory framework for new clinker and cement plants was updated on January 1, 2005. The new emissions regulations are equivalent to, or more stringent than, the World Bank guidelines except for NOx emissions where the Chinese regulation accept up to 800 mg NOx/NM3, while the World Bank guidelines stipulate a maximum of 600 mg NOx/NM3. Consequently, all Anhui Conch’s new or planned clinker production lines will be designed according to the Chinese regulation, but with the more stringent World Bank guideline limit for NOx. If technical constraints (e.g., available fuel characteristics) make compliance with the World Bank guidelines difficult, IFC will require analysis of ambient air conditions associated with a specific production line to determine the acceptability of performance to the slightly higher Chinese emission limit.
- Emission reduction activities for greenhouse gas (CO2):
In 1998 Anhui Conch became the first cement producer in China to commission a heat recovery power plant on a cement kiln. This plant has since produced 5.3 MW electricity per million tons per year installed clinker capacity. In practical terms this means that half of the kiln’s power consumption is internally produced and the import of power from the national grid similarly reduced.
Anhui Conch’s capital expenditure plans for the next three years include the retrofitting of similar recovery systems on all its kilns with a capacity equal to, or greater than, 5000 tpd of clinker. The power generation from these additional heat recovery units will reach 124 MW by the end of 2007. The power generation in China is heavily relying on coal and the installation of the recovery units will therefore result in a reduction in green house gas emissions of nearly 700,000 tons CO2 per year.
- Health and safety standards:
A significant number of Anhui Conchs clinker production plants were visited during IFC’s appraisal and all plants were found in good conditions with clean working surfaces, handrails, machine guarding and other safety equipment in place. In some cases it was found that employees working in areas with high noise levels were not using hearing protection, and Anhui Conch will put extra focus on enforcing the use of personal protective equipment (PPE) in these areas. Accident statistics for the company were also analyzed and the accident frequencies were found to be within the normal range for the cement industry.
