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.
- Social and Environmental Assessment and Management:
CGH today is a mixture of old sites dating to the 1950’s, some much newer sites, and yet others which although old have had recent significant capacity increases. All new projects, and major upgrade or expansion projects are required to submit their plans to the Chinese authorities, and to commission Environmental Impact Assessments of the projects. These EIAs provide detailed examinations of the projects’ areas of influence, and the projects’ effects on the environment within these areas. These EIAs identify the Chinese laws with which the projects must comply, and define necessary mitigation measures to be undertaken to meet these requirements.
The only vulnerable groups believed to be impacted by the project were those persons displaced by the solar glass JV project. These persons were identified and compensated, as is described below.
The sophistication and effectiveness of the social and environmental management programs vary by site, and these issues are managed at site rather than corporate level. All sites had a staff devoted to environmental and safety matters. The Suhuada site at Suqian had its environmental management system certified compliant with ISO14001:1996 in 2004, and compliant with ISO14001:2004 in early 2005, though other sites are less sophisticated. Similar differences were present in the sophistication of safety management systems.
In most cases, emissions to air and water are measured by the Chinese environmental authorities, rather than by the manufacturing companies themselves, these measurements being undertaken as post-commissioning tests that emissions meet expectations of the EIAs, or as part of regular (e.g. annual ) monitoring and supervision by the authorities. Some data are shared with the companies involved; others are not.
CGH will establish an environmental and social management structure, reporting to a senior vice president of the company, to identify and replicate environmental best practices across the group, and to manage environmental and occupational health and safety matters through the group. Environmental and safety management practices at site level will be established or modified, such that each site develops environmental and occupational health and safety management systems, or alternatively an integrated management system, capable of achieving certification of compliance with ISO 14001 and OHSAS 18001 requirements, with compliance being audited by an international agency. Development of these management systems will require systematic, site-by-site evaluation of environmental impacts of operations, and OHS risk assessment.
Community engagement has ranged from nothing to comprehensive annual surveys of opinions of neighboring communities. Certain sites provide social services for local communities, for example Wuhai provides district heating to its neighbours at cost.
At the sites which have effective community engagement this process provides a forum for grievances. However, in all cases, grievances can be accepted by the companies’ general administration offices, by neighborhood committees and by the local environmental protection agency. Complaints are monitored and responses recorded, and have been few, limited to concerns, since resolved about noise arising from night-time operations of the batch plant (which have now ceased.)
- Labor and Working Conditions:
Labor relations are substantially managed at site level, though there is a CGH Human Resources policy.
All employees have written contracts of employment, which may be open-ended, renewable 1-year contracts or longer term contracts depending upon position. These contracts define the rights and responsibilities of both parties. Remuneration comprises a basic salary, performance-related bonus and a year-end bonus, details of which are documented in the employment contract. Working hours in this continuously operating industry are based on a nominal 40 hour week, (5 x 8 hour days), with four groups working three shifts: overtime working is very rare. CGH’s youngest employee is aged 18 years.
No manufacturing site makes any distinction in salary or benefits on the basis of worker residency registration or any other characteristic unrelated to the requirements of the job. Employees are able to join a trade union, and union membership does not attract discrimination by CGH. CGH has a three-strand labor grievance process, in that employees are able to air grievances through the sub-union branch representing the worker’s normal workplace, through the administration office of the company using a complaints box, and directly to the HR department of the company.
Management of occupational safety varies greatly from site to site. One site, Suhuada, has an occupational health and safety management system certified to OHSAS 18001, and has been able to demonstrate an almost 40% reduction in lost time accident frequency over three years: others barely manage the issue, undertaking regular inspections but leaving many OHS hazards unmitigated. All sites provide personal protective equipment, but this varies from site to site, even though the hazards presented are similar. This is particularly striking in PPE provided for those manually handling large glass sheets.
- Emissions to Air:
Emissions to air comprise fugitive dust emissions, dust arising from batch plants, combustion products and batch-derived particulate emissions from furnaces, and fugitive emissions from coal gasification plants used at the Wuhai, Nanjing and Xi’an sites.
Although limestone and cullet are stored in the open, other raw materials are stored under cover and as a result, fugitive dust emissions are limited. Batch plants have effective dust control, exhausting through filters to atmosphere.
Furnace emissions vary widely. One furnace at Weihai has a wet scrubber to control emissions of sulphur dioxide and particulates, but otherwise there is no secondary control of particulates, nitrogen oxides or sulphur dioxide. Some air emissions data do exist and are now summarized.
Particulate emissions are reported to be between in the range of 26 to 560 mg/Nm3, with figures at the upper end of this range exceeding Chinese standards. Since only one furnace has secondary emissions control, and it is the experience worldwide that particulate emissions significantly below 100 mg/Nm3 are difficult to achieve through primary measures only, we doubt the reliability of figures at the lower end of the range. However, many furnaces exhaust through waste heat boilers, and it is possible that these become fouled removing particulate matter from exhaust air streams. Reported furnace emissions of sulphur dioxide are between 98 and 2100 mg/Nm3, with four furnaces at Weihai, which burn high sulphur-content oil exceeding Chinese requirements. The scrubber project described above, was highly effective in mitigating sulphur-dioxide emissions and will be extended to the other furnaces. Nitrogen oxide emissions are not universally measured, since emissions of this compound are not regulated in China. The measurements available indicate emissions around or slightly exceeding the IFC guideline limit of 1,000 mg/Nm3.
China Glass will measures emissions to air of particulate matter, sulphur dioxide and nitrogen oxides and report measurements to IFC. Thereafter, primary emissions control measures will be adopted with the objectives to limit particulate emissions to less than 100 mg/Nm3 and NOx emissions to less than 1,000 mg/Nm3. Secondary particulate emissions control devices, designed to limit particulate emissions below 50 mg/Nm3 will be added to furnaces at cold repair. The need for secondary NOx control will be considered on a case by case basis, taking account of ambient conditions, and may be incorporated into cold repair if shown necessary. Secondary particulate control will be incorporated into the design of the solar glass plant from new.
Three plants (Wuhai, Nanjing and Xi’an) produce gas used as furnace fuel by passing a mixture of air and steam over a vertical bed of hot coals, manufacturing gas containing carbon monoxide, hydrogen, and some hydrocarbons, and also carbon dioxide and nitrogen. Hydrogen sulphide odour is present around these gas plants. China Glass will measure concentrations of this gas to determine whether it is present at levels presenting an occupational health and safety hazard, and will seek to control emissions which appear to escape from the reactors via the coal charging mechanisms.
In general, China Glass’s plants do not achieve the levels of energy efficiency in glass melting seen elsewhere in the world. The plants which manufacture gas from coal are particularly inefficient; while another plant with new equipment broadly matches typical energy efficiency levels. CGH has attempted to combat increasing fuel prices through converting to lower cost fuels, including coal, rather than aggressively pursuing energy efficiency opportunities. Specific use of electricity is closer to world practice, with CGH making extensive use of electronic variable speed drives. Annual carbon dioxide emissions arising from CGH’s fuel use are in the order of 1.1 million tonnes. CGH will on an annual basis quantify and report to IFC its carbon dioxide emissions.
CGH will seek energy efficiency advice from sector experts to determine opportunities to improve energy efficiency through changes in ongoing operations, and those which can only be implemented at furnace rebuild. In an experimental project, the Suhuada factory will install a high steam pressure heat recovery boiler on one furnace flue, and will use the steam so generated to drive a steam turbine for power generation. If this project is technically and economically successful, CGH will replicate throughout to all sites.
- Emissions to Water:
With the exception of the Suhuada site, which treats effluents to IFC and Chinese requirements, and Nanjing which had no data, all sites discharge process and sanitary effluents to municipal systems for further treatment. Xi’an’s effluent is not treated further after discharge, but meets IFC and Chinese requirements at the discharge point, for a limited range of parameters. No site monitors storm water quality, and in the three which produce gas from coal (Nanjing, Wuhai and Xi’an) storm water is likely to contain run-off from coal storage areas, and also water spilling from water seals at the base of the gasification towers through which ash is discharged from gasifiers. Additional monitoring of these liquid waste streams will be undertaken and suitable pollution mitigation measures installed as may be found by this monitoring to be necessary.
- Community Health and Safety:
CHS impacts of these manufacturing sites are generally small: dust is well controlled, and the factories are sufficiently far from residential areas for noise not to be a nuisance. There is potential for off-site release of gas from the gas generation systems, and such a release would present an explosion hazard and would also be toxic, because of the carbon monoxide content of the gas. At gas-generating sites, detection of gas leaks will be strengthened, and emergency response plans, including guidance on when to inform the factory neighbors of a leak will be developed.
- Resettlement Issues:
CGH’s solar glass factory will be constructed on a 13.4 ha (200 mu) site which is one part of a new industrial estate of approximately ten times this area. Land use rights were acquired by the industrial estate in April 2006 and by SGH (for the solar glass site) in December 2006. The solar glass factory will be built on land which was formerly occupied by residential housing and also used for farming. Factory construction will require the displacement of 24 houses, of which 20 were occupied by 80 persons: in addition 22 persons derived income from agricultural activities on the land to be used for the factory.
The value of lost physical assets was determined through a survey by a local realty valuation and survey company; and compensation payments for loss of housing, ranging from RMB 25,000 to 845,000 have been paid to those displaced by the project. In addition, these households are now resettled in brand new homes of around 300 m2 area, land for which was provided free of charge.
Loss of land use rights has been compensated by payment of ten times the average value of crops grown on the land over the last three years.
Of the 80 people displaced by the project, 6 have left the area, 14 are students, 38 worked in factories, and 22 who were unable to find factory work, on grounds of age, farmed the land. It is not expected that these 22 persons will be able to find alternative employment, and so these persons are now paid an annual pension of RMB 4,776, which exceeds typical former farming-derived income of around RMB 4,000.
It is concluded that since those persons displaced by the project have been compensated and rehoused, and those who formerly farmed are paid pensions which exceed their former farming incomes; the objectives of Performance Standard 5 have been met. CGH will establish a grievance mechanism such that it can identify and respond to any grievances which may arise as a result of the land acquisition process.
