GILGEL GIBE II HYDROPOWER PLANT

The project consists of a medium-scale Hydro Power plant with a capacity of 428 MW and 385 km of overhead transmission lines and substations. The project is cascaded with the Gilgel Gibe I project, recently commissioned and co-funded by the Bank.

The project aims at increasing power generation capacity in order to satisfy the growing demand in a country where only 15% of the population has access to electricity.

For the hydropower scheme and transmission component two separate Environmental Impact Assessment have been carried out (in line with provisions of EU Directive 97/11/EC).

The Environmental Management Plans for the overall project propose adequate measures to mitigate negative impacts and relate mainly to guaranteeing water flows in the Gilgel Gibe river, landscaping of disposal areas, as well as of construction sites and roads. Furthermore, special attention will be paid to health education and a health centre will be established. Schemes for resettlement and land and crop compensation have been set up.

Environmental Monitoring structures are available through EEPCO's Environmental unit, with overall supervision by the Government's Environmental Protection Agency (EPA) through reporting.

The scope of the proposed measures adequately covers all identified environmental and social aspects and the overall environmental impact of the project is considered acceptable.

An Engineering, Procurement and Contracting (EPC) contract for the hydropower plant and the related activities was directly negotiated with one of the civil contractors who participated in the Gilgel Gibe I project. The prices are based on the unit prices for the (internationally tendered) contracts of the Gilgel Gibe I project and adjusted for inflation and for technical contingencies. An independent consultant confirmed the appropriate price level of the EPC contract.

The EPC contractor has tendered internationally, with publication in the Official Journal of the European Union, the two subcontracts for the electromechanical and hydro mechanical equipment. The contracts for the transmission lines and substations are also scheduled to be tendered internationally with publication in the OJ. The financing of the Bank will be restricted to those items, for which international tender procedures have been carried out in line with EIB's procurement guide.

Electricity, Gas and Water Supply.