NEP: Energy Access and Efficiency Improvement Project

Resettlement Plan July 2009 NEP: Energy Access and Efficiency Improvement Project Prepared by: Nepal Electricity Connectivity and Energy Efficiency Project I This resettlement plan is a document of the borrower. The views expressed herein do not necessarily represent those of ADB's Board of Directors, Management, or staff, and may be preliminary in nature. i

NEPAL ELECRICITY AUTHORITY Durbarmarg, Kathmandu Draft Final LAND ACQUISITION AND RESETTLEMENT PLAN Prepared For Construction of 132 kv New T/L and Related Sub-station Works in Dumre-Damauli-New Marsyangdi Sub-station Section; Construction of 30 MVA, 132 kv/11 kv Sub-station at Chapali; and Construction of Eight New 33/11 kv, 6/8 MVA Sub-stations; and 3 New 11 kv Switching Sub-stations in Different Districts Prepared By: Nepal Electricity Connectivity and Energy Efficiency Project I NEA/ADB SSTA 7176: NEP Kathmandu, Nepal July 2009 ii

Nepal Electricity Connectivity and Energy Efficiency Project SSTA 7176 NEP: LARP Glossary of the Terms Bigha Chief District Officer (CDO) Dalit (Minor Caste Group) District Development Committee (DDC) Janajati (Ethnic/Indigenous People) There are three major units (Bigha, Kattha, and Dhur) used to measure and keep official record of land in Southern plain of Nepal known as Terai. One Bigha is equivalent to about 6869 sq.m. (Twenty Dhur makes one Kattha, and twenty Kattha makes on Bigha) There are 75 administrative districts in Nepal. Chief District Officers (CDO) are the Chief Administrative Officers of these districts. Among others, the responsibilities of the CDOs also include managing and maintaining district administration, law and order situation in the district, and implementing Land Acquisition and Resettlement Plan for the development projects to be implemented in the districts. Dalit is commonly known as untouchable in traditional Nepalese society. They belong to occupational and artisan group. Dalit Commission has defined dalit as, the community discriminated on the basis of caste and marginalized in terms of social, economic, educational, political and religious sectors. The Dalit caste, has further been divided into different groupings in accordance with socially prescribed type of works. For example, communities traditionally engaged in tailoring, or playing musical instruments, making shoes or communities involved in washing clothes, are given different family names in accordance to the type of traditional occupation they are involved with. There is one District Development Committee in each administrative districts of Nepal to be headed by elected district level political leader. In broad, Nepalese indigenous population consist two major groups, the Indo-Nepalese, whose ancestors migrated into the country from the south and the Tibeto-Nepalese, whose ancestors entered Nepal from the north. There exist cultural, linguistic, and religious differences both between and within the two groups. Differences within the Indo-Nepalese grouped are marked more by caste (a system of social hierarchy) than by ethnicity. The Tibeto- Nepalese group comprises several different ethnic groups including Bhutia, Sherpa, Gurung, Magar, Tamang, Rai, and iii `

Nepal Electricity Connectivity and Energy Efficiency Project SSTA 7176 NEP: LARP Limbu people. The Tibeto-Nepalese are concentrated in hill and mountain and the Indo- Nepalese are concentrated in the Terai plain and inner Terai. Land Acquisition and Compensation Fixation Committee Permanent Acquisition Permanent loss of Crops Restriction to Use of Land Ropani Temporary effect on land Temporary loss of Crops As defined by Nepal indigenous/nationalities/tribal, Act defines; People having their own mother tongue, distinct traditional values, and cultural identities, including social structure and written/non-written history are Indigenous and nationalities population. The committee to be formed under the chairmanship of CDO for acquiring and compensating land and properties based on Land Acquisition Act of Nepal (2034) 1977 and Electricity Rule 1993. Land and other assets permanently acquired for the construction of sub-stations, transmission towers and other associated works related to the project in accordance with the prevailing Acts. Permanently acquired land and other assets are paid compensation on replacement cost based on current market rate. All the permanently acquired land are transferred in the name of Executing Agency. Long term loss of crops production in the cultivating land permanently acquired for the project. Land not acquired permanently but used to maintain the RoW of the transmission lines. Ownership of such land will not be transferred and the owners will be allowed to cultivate their land. However, there will be restrictions to construct structures and for plantation of trees within the specified zone of influence of the transmission lines (e.g. 9m both sides for 132 kv T/L) subject to be compensated under the prevailing law as provisioned in Land Acquisition Act 1977 and Electricity Rule 1993. Land measurement unit, practices in the hilly regions of the country. One Ropani of land is equivalent to approximately 508.74 sq. ft. There are three sub-units under the Ropani. They are; (a) Aana (342.25 sq.ft.), (b) paisa (85.56 sq.ft), and (c) Daami (29.39 sq.ft) Land temporarily affected due to use by the contractors during the construction phase. Compensation for the temporary use of land to be paid by the contractors to the land owners in accordance to the agreed terms and conditions to be signed between the two parties. One time loss of crops likely to occur during the iv `

Nepal Electricity Connectivity and Energy Efficiency Project SSTA 7176 NEP: LARP Village Development Committee (VDC) Ward construction period of new transmission line or second circuit stringing on the existing double circuit towers. VDC is the local level administrative unit to be represented by locally elected political leaders in rural areas with certain geographical boundary, number of households and population. Ward is the lowest level administrative unit to be represented by elected local political leaders. As per the existing administrative system, each municipal local administrative area contains up-to 35 numbers of wards whereas the number of ward is only up-to 9 in the case of Village Development Committees (VDC). v`

Nepal Electricity Connectivity and Energy Efficiency Project SSTA 7176 NEP: LARP ACRONYMS ADB - Asian Development Bank AH - Affected Households AP - Affected Persons CDO - Chief District Officer CFC - Compensation Fixation Committee CRO - Chief Resettlement Officer CRO - Chief Resettlement Officer DDCs - District Development Committee GON - Government of Nepal GRC - Grievance Redress Committees Ha - Hectare Km - Kilometer LARP - Land Acquisition and Resettlement Plan MRM - Management Review Mission NEA - Nepal Electricity Authority NGO - Non Government Organization NRs - Nepalese Rupees PIU - Project Implementation Unit PM - Project Manager PM - Project Manager PO - Project Office/Officer PPTA - Project Preparation Technical Assistance RoW - Right of Way RP - Resettlement Plan S/S - Sub-station SAARC - South Asian Association for Regional Co-operation SLC - Sub-Project Level Committee T/L - Transmission Line VDC - Village Development Committee vi `

Nepal Electricity Connectivity and Energy Efficiency Project SSTA 7176 NEP: LARP I. The Project Introduction Executive Summary 1. The proposed Nepal Electricity Connectivity and Energy Efficiency Project consist of six investment components and one component on provision of expert services. The Investment component supported by the ADB grant covers six main outputs each consisting of several activities. The first four major investment outputs are; (i) Transmission System Augmentation; (ii) Distribution System Enhancement; (iii) Distribution Loss Reduction; and (iv) Generation Plant Improvement. The investment components have been proposed by Nepal Electricity Authority (NEA) based on its generation and rehabilitation plan, transmission system master plan and short-term distribution augmentation plan. The other two investment outputs are (v) Energy Efficient Lighting and (vi) Solar Power based Street lighting. The final component is to provide (viii) Expert Services assisting Public Private Partnerships (PPP) in distribution. II. Scope of Land Acquisition and Resettlement Planning 2. This Land Acquisition and Resettlement Plan (LARP) has been prepared for (a) Dumre- Damauli-New Marsyangdi Transmission Line (T/L) section under the Middle Marshyangdi - Dumauli Marshyangdi 132 kv transmission line and related Sub-station works, (b) Construction of Chapali Sub-station, and (c) Constructing Distribution and Switching Substations in different ten districts. 3. Land acquisition and resettlement planning however, may not require for; (i) Stringing of 132 kv second circuit between Middle Marsyangdi-Marsyangdi (44 km), (ii) Expansion, reinforcement and construction of new sub-stations at Damauli, Middle- Marsyangdi, and Marsyangdi (Aanbu Khairini) under the Middle Marsyangdi-Damauli-Marsyangdi New Marsyangdi 132 kv transmission line and sub-station construction components, (iii) Second circuit stringing between Butwal-Kohalpur (200 km,), (iv) Construction of distribution substations and switching centers at Swyambhu, Synaja, Mahottari, (v) Expansion of Matatirtha sub-station at Kathmandu, (vi) 66 kv underground cabling from Chabahil to Lainchaur (7.5 km) and associated sub-station upgrading works, and (vi) Installation of 220 MVAR capacitor banks to reactive power compensation at eight transmission existing sub-stations. Project activities under these components will be carried out on the available Government/NEA land or existing RoW. However, taking into account to likely losses of crops and trees during second circuit stringing the LARP has provisioned compensation for the same. Similarly, land acquisition and resettlement plan also may not require for the investment component of (i) clean energy plant development, (ii) supply side energy efficiency improvement, (iii) public private partnership in distribution, and (iv) energy efficiency in lighting, and renewable energy for street-lighting as the activities are basically related to the replacement of available technical equipment/appliances and management aspects. Table 1 provides land acquisition requirement for different investment components under the project. Table 1: Land Acquisition Requirement for the Project S.N Project Component Permanent Acquisition Restriction to Use for RoW Total (in ha) 1, New Transmission Line and 1.90 19.35 21.25 Transmission Sub-station Construction 2. Construction of Distribution Sub-station 2.76 2.04 4.74 and Switching Centers Total Estimated Area of Affected Land 4.66 21.39 25.95 Note: The data presented in the table is based on preliminary census data and estimation and will be updated during detail Design. vii `

Nepal Electricity Connectivity and Energy Efficiency Project SSTA 7176 NEP: LARP 4. As shown in the table above, an estimated area of 26.05 ha of land is required to implement the project activities. Out of which, about 4.66 ha to be acquired permanently and another 21.39 ha of land will be restricted to use except for agriculture purpose. As the land restrict for RoW will not be acquired permanently, the cultivator will be allowed to use the land for agriculture purpose. The Land Acquisition and Resettlement Plan (LARP) prepared under the Technical Assistance (TA) ensures; (i) types and extent of losses due to the project (ii) Principles and legal framework applicable for mitigation of losses, (iii) Entitlement matrix for compensation and other assistance based on the inventory of losses, (iv) Provisions for relocation assistance and restoration of house/businesses/income, (v) Budgets, and institutional framework for the implementation of the plan, and (vi) Responsibilities for monitoring of the LARP measures. III. Impacts 5. A total of 314 households and 1654 persons likely to be affected due to the proposed Project. The major impacts include permanent acquisition of land, restriction to use land (except to use for agriculture purpose), and acquisition of residential/commercial structures along the proposed T/L RoW (Table 2). Table 2: Affected Households and APs S.N. Type of Effect Affected HHs (No.) Total A P (No) 1. Effect on Land 294 1551 2. Effect on Structures 20 103 Total 314 1654 Note: The data presented in the table is based on preliminary census data and estimation and will be updated during detail Design. 6. Of the total (314) affected households, 22 households likely to have significant impact (2 households due to effect on residential land and 20 households due to effect on their residential/commercial structures). 7. The project may also cause loss of crops in 146.55 ha of land and private trees in the affected land. 8. The LARP has devised mechanism of addressing likely resettlement issues at local and project levels as much as possible through the Grievance Readdressal Committees (GRC) to ease the LARP implementation before going to the court. 9. All the project-affected households will be paid compensation at full replacement cost (market price) based on prevailing Acts/Rules, ADB Guidelines, and NEA practices. In addition to the compensation, the LARP has also provisioned different types of financial assistance (e.g. shifting, cost, transitional allowance, compensation for loss of business etc). In accordance to the Government s policy, and ADB guidelines at least, one family member from each project affected vulnerable people will also be enrolled in income restoration and improvement program to be implemented as a part of resettlement plan in Dumre-Damauli 132 kv T/L construction section, as the number of vulnerable households is comparatively higher in this project section. IV. Project Locations 10. The Project activities will cover 14 administrative districts of all-five development regions of the country (Table 3). As per the technical design, construction and viii `

Nepal Electricity Connectivity and Energy Efficiency Project SSTA 7176 NEP: LARP expansion/strengthening of transmission sub-stations (Chapali, Matatirtha, and Lainchaur including underground cabling) and two switching centers (Mulpani and Swyambhu) will be implemented at Kathmandu. The New 132 kv T/L will be implemented in Tanahu and Gorkha districts, and nine distribution sub-stations will be constructed in different districts across the country. Table 3: Locations of Investment Components S.N. Development Region Districts Investment Component Type T/Line and S/S Distribution S/S and S/ Centers 1. Eastern Development Region Jhapa & Siraha 2. Central Development Region Kathmandu, 3. Western Development Region Gorkha, Lamjung, Tanahu, Synaja, Kaski, Parbat 4. Mid-western Development Region Banke & Bardiya 5. Far-western Development Region Kailali and Kanchanpur Source: NEA, Technical Design and Census Survey Feb. 09 Apr. 2009 V. Resettlement Principles, Policy, and Legal Frameworks 11. Land acquisition principles adopted for this project recognize the Land Acquisition Act 1977, Electricity Act 1992, Electricity Rule 1993, and ADB Policy on Involuntary Resettlement 1995. Besides, other relevant Acts, Government policies and applicable NEA practices and experiences will also to be considered, while implementing this Land Acquisition and Resettlement Plan. The resettlement principles adopted in this Project will provide compensation and resettlement assistance to all affected persons and businesses, irrespective of titles and extent of impact, in accordance with ADB s Policy on Involuntary Resettlement and Government s Act. Based on the above policy features, the principles of R&R for this Project will entail the following: Negative impact on persons affected by the Project would be avoided or minimized as much as possible; Where the negative impacts are unavoidable, the Project-affected persons will be assisted in improving or regaining their standard of living. Vulnerable groups will be identified and assisted to improve their standard of living; Land replacement 1 /or cash compensation at replacement costs based on current market rate to the households affected by the loss of land. ; Cash compensation will be paid for residential/commercial/residential-cum-commercial and other structures affected by the Project at current market price; Assistance should be provided to the owners of structures and non-titleholders, who may incur loss of ability to maintain livelihood during relocation and resettlement; 1 There is also provision of land for land compensation to the APs having complete loss of their land only if government land is available in the area (Land Acquisition Act 1977, Clause 14) ix `

Nepal Electricity Connectivity and Energy Efficiency Project SSTA 7176 NEP: LARP Rehabilitation assistance i.e.; compensation for lost business and workdays (including employees) due to relocation and disruption of business enterprise. Before taking possession of the acquired lands and properties, compensation and Resettlement & Rehabilitation (R&R) assistance will be provided in accordance with this policy. Appropriate grievance redress mechanism will be established at the district, and local level to ensure speedy resolution of disputes. All activities related to resettlement planning, implementation, and monitoring would ensure involvement of women, vulnerable groups and APs. VI. Consultation and Stakeholder Participation 12. Stakeholders at different level were consulted during Resettlement Plan preparation process. The consulted stakeholders also include representatives of relevant line agencies (e.g. NEA officials, CDO, Land Measurement Office, District Forest Office, and Local NGOs etc), local people and project-affected families including the vulnerable groups, forest users groups, local level social workers, representatives of political parties, businesspersons, and other resource persons. The stakeholder consultations was found effective on disseminating information about the project, conducting socio-economic and census survey, and soliciting other relevant information/data to prepare the resettlement plan. VII. Institutional Framework 13. NEA will be the Executing Agency (EA) of the project. Managing Director will be the Chief In-charge for the implementation of all components under the project. Under the Managing Director, a project implementation team will be formed for the Transmission and Distributions Departments. NEA will assign Project Managers (PM) for the components under Directors of both Transmission and Distribution Departments. The PM will act as Project Implementation Unit (PMU) and report to the respective Directors (Transmission and System Operation Department and Distribution and Consumer Service Department) of Executing Agency. Technical, administrative and account sections will support in the overall project and LARP implementation activities to be carried out by the Project Office (PO). 14. Four Project Managers (PM) will be assigned under the Transmission and System Operation Department to implement the project activities under: (i) Butwal - Kohalpur Second Circuit Stringing; (ii) Middle-Marsyangdi Damauli Marsyangdi; (iii) Chapali-substation Construction and Chapahil-Lainchaur Underground Cabling and Sub-station Enhancement; and (iv) Expansion of Matatirtha Sub-station. Similarly, two Project Managers (one for eastern and one for central and western districts) will be assigned to implement the distribution components in 10 different districts including Kathmandu. The PM to be assigned for Eastern districts will be stationed at Dhanusha will implement the project in Eastern districts (Jhapa, Siraha, Dhanusha, Mahottari and Sarlahi). The PM to be assigned for Central and Western districts will be stationed at Pokhara and implement project activities in Western (Kathmandu, Kaski, Syanja, Parbat, and Bardiya) districts. These PMs will also be supported by technical, administration and account sections. 15. The PM will regularly update the EA on the progress of LARP implementation activities. The PM will coordinates with the Chief District Officers (CDOs) and formally request for the formation of Land Acquisition and Compensation Fixation Committee (LACFC) for the project. All land acquisition and resettlement related documents prepared for x`

Nepal Electricity Connectivity and Energy Efficiency Project SSTA 7176 NEP: LARP the project will be handed over to the CDO. The PM to assist CDO on the valuation, verification and finalization affected assets. The PM also to involve local NGO wherever applicable, to implement the LARP. The PM will coordinate with CDO to establish Grievance Redressal Committee in accordance to Clause 11 of Land Acquisition Act 2034 (1977). The PM will update and report the EA on the progress of LARP implementation. VIII. Monitoring and Evaluation 16. The implementation of Land Acquisition and Resettlement activities will be monitored internally and externally. Generally, internal monitoring will be conducted by Project Office and external agencies or independent consultants undertake the task of external monitoring. An external monitoring agency or consultant will be engaged by NEA to carry out independent monitoring on bi-annual basis that also include post Project evaluation. External monitoring will be carried out through outside researcher or consulting agency or NGOs, or through independent consultants. IX. Budget 17. An estimated budget amounting NRs. 425,795,500.7 (US$ 5,322,444)have been calculated to implement the proposed Land Acquisition and Resettlement Plan. xi `

Table of Contents Glossary of Terms List of Acronyms Executive Summary I. THE BACKGROUND... 1 1.1 Introduction... 1 1.2 Scope of Land Acquisition and Resettlement Plan... 3 1.3 Projects Benefit and Impact... 4 1.3.1 The Benefits... 4 1.3.2 The Impacts... 4 1.4 Measures to Minimize the Impact... 5 1.5 Objective of the Land Acquisition and Resettlement Plan... 5 II. THE PROJECT LOCATION... 6 2.1 Locations of Transmission Line /Sub-station Components... 6 2.1.1 Middle Marsyangdi Damauli-Marsyangdi... 6 2.1.2 Chapali Sub-station... 6 2.2 Locations of Distribution Components... 7 III. SOCIOECONOMIC SURVEY AND CENSUS... 9 3.1 Socio-economic Information... 9 3.2 Affected Families and Assets... 10 3.3 Effect on Land... 11 3.3.1 Ownership Type of the Affected Land... 11 3.3.2 Extent of Effect on Land... 12 3.4 Effect on Structures... 13 3.4.1 Ownership of the Affected Structures... 13 3.5 Loss of Agricultural Crops and Trees... 14 3.5.1 Loss of Crops... 14 3.5.2 Loss of Provate Trees... 15 3.6 Impact on Indigenous/Ethnic and Minor Caste Households... 15 3.7 Impact on Other Socially Vulnerable Groups... 16 3.8 Loss of Common Property Resources... 17 IV. RESETTLEMENT PRINCIPLES, POLICY, AND LEGAL FRAMEWORKS... 19 4.1 ADB Resettlement Policy... 19 4.2 Policy and Legal Frameworks... 20 4.3 Difference between ADB Policy and GON Resettlement Framework... 21 4.4 NEA Practices on Land Acquisition and Resettlement... 22 4.5 Resettlement Principles & Assistance of the Proposed Project... 22 4.6 The Entitlements... 23 4.6.1 Compensation for Land... 23 4.6.2 Compensation for Loss of Crops and Trees... 24 4.6.3 Compensation for Structures (residential/ residential-cum-commercial)... 24 4.6.4 Compensation for the Loss of Community Forest... 24 4.6.5 Financial Assistance to Tenants... 24 4.6.6 Shifting/Transportation Allowance... 25 4.6.7 Land Replacement Cost... 25 4.6.8 Compensation for Loss of Business and Shifting Allowance... 25 xii

Nepal Electricity Connectivity and Energy Efficiency Project SSTA 7176 NEP: LARP 4.6.9 Transitional Allowance to the Affected Structures Owners... 25 4.6.10 Income Restoration and Improvement... 25 V. CONSULTATION AND STAKEHOLDER PARTICIPATION... 34 5.1 The Approach... 34 5.2 Disclosure of RP... 34 5.3 Further Consultation & Community Participation... 34 VI. INSTITUTIONAL FRAMEWORK... 35 6.1 The Setup... 35 6.1.1 Transmission and System Operation Department... 35 6.1.2 Distribution and System Operation Department... 35 6.2 Roles and Responsibilities... 35 6.2.1 The Executing Agency (EA)... 35 6.2.2 The Project Office... 39 6.2.3 Grievance Redress Committee (GRC)... 36 6.2.4 Non-Government Organizations (NGOs)... 37 6.3 Role and Responsibilities... 38 6.4 Implementation Schedule... 40 6.5 Staff Training on Resettlement Implementation... 40 6.6 Resettlement Data Bank... 40 VII. COMPENSATION ACQUISITION AND RESETTLEMENT BUDGET... 42 7.1 Valuation of Affected Assests and Fixation of Compensation Rate... 37 7.2 Valuation Basis of Affected Assets and Associated Costs... 42 7.2.1 Valuation of Land... 42 7.2.2 Valuation of Structures... 42 7.2.3 Valuation of for the Loss of Crops... 43 7.2.4 Valuation of Affected Private Trees... 43 7.2.5 Valuation of Shifting/Transportation Allowances... 43 7.2.6 Valuation of Land Required for Replacement... 43 7.2.7 Valuation of Affected Business and Shifting Cost... 43 7.2.8 Estimation for Income Restoration and Improvement Activities... 43 7.3 Cost Estimated for Compensation and Other Financial Assistance... 43 VIII. MONITORING AND EVALUATION... 48 8.1 Need for Monitoring... 48 8.2 Internal Monitoring... 48 8.3 External Monitoring... 49 8.4 Reporting Requirements... 50 List of Tables: Table 1-1: Land Acquisition Requirement for the Project... 4 Table 1-2: Affected Households and APs... 5 Table 2-1: Locations of Investment Components... 6 Table 3-1: No of Project Affected Households Interviewed... 9 Table 3-2: Summary of Project Impact... 10 Table 3-3: Households Likely to have Significant Impact... 110 Table 3-4: Effect on Land by Purpose of Acquisition... 11 Table 3-5: Land Ownership Status... 11 Table 3-6: Extent of Impact on Land... 12 xiii `

Nepal Electricity Connectivity and Energy Efficiency Project SSTA 7176 NEP: LARP Table 3-7: HHs Likely to have Significant Effect on Residential Land..13 Table 3-8: Types of Affected Structures... 13 Table 3-9: Ownership Status of the Affected Structures... 14 Table 3-10: Estimated Loss of Crops... 14 Table 3-11: Loss of Private Trees... 15 Table 3-12: Indigenous/Ethnic and Minor Caste HHs Likely to be Affected... 15 Table 3-13: Impact on Other Vulnerable and Socially Disadvantaged Households... 16 Table 3-14: Community Forest Likely to be Affected in Dumre Damauli Section... 17 Table 4-1: Difference between ADB and GON Policy on Resettlement Framework... 22 Table 4-3: Vulnerable HHs Requiring Income Restoration & Improvement Activities... 26 Table 4-2: Entitlement Matrix... 28 Table 6-1: Schedule of Implementing Land Acquisition and Resettlement Plan... 40 Table 7-1: Compensation for Land... 44 Table 7-2: Compensation for Structures... 44 Table 7-3: Compensation for Loss of Crops... 44 Table 7-4: Compensation for Loss of Private Trees... 44 Table 7-5: Compensation for Loss of Business... 45 Table 7-6: Transitional Allowance to APs having Loss of Structures... 45 Table 7-7: Shifting Allowances for the Affected Residential/Commercial Structures... 45 Table 7-8: Land Replacement Cost... 45 Table 7-9: Income Restoration and Improvement... 45 Table 7-10: NGO Mobilization Cost... 46 Table 7-11: External Monitoring and Evaluation... 46 Table 7-12: Summary of Resettlement Budget and Cost Estimate... 47 APPENDICES : APPENDIX A-1 : APPENDIX A-2 : APPENDIX B-1 : APPENDIX B-2 : APPENDIX B-3 : APPENDIX C-1 : APPENDIX C-2 : APPENDIX C-3 : APPENDIX C-4 : APPENDIX C-5 : APPENDIX C-6 : APPENDIX D-1 : APPENDIX E-1 : APPENDIX F-1 : APPENDIX G-1 : APPENDIX H-1 : APPENDIX I -1 : Information on land acquisition requirement by investment components Details on land acquisition impact by locations. Key socio-economic characteristics of the project districts A brief descriptions of the locations of each investment component Proposed locations for the distribution sub-stations and switching centers Key socio-economic characteristics of the affected households. Breakdown of the impacts by locations. List of landowners Description of the affected structures by construction types and other details Details on permanent and temporary loss of crops List of Indigenous/Ethnic and Minor Caste HHs likely to have significant impact A synopsis of NEA s practices on implementing resettlement plan consultation matrix The Terms of Reference (ToR) of NGO The current market rate of the affected land at Dumre-Damauli Details on Land Compensation Cost Terms of Reference for External Monitoring Agency xiv `

Nepal Electricity Connectivity and Energy Efficiency Project SSTA 7176 NEP: LARP I. THE BACKGROUND 1.1 Introduction 1. Government of Nepal aims to expand electricity to rural areas by providing quality services at a low cost, to adopt hydro-electricity as the foundation of overall economic development, and develop it as an exportable item. 2 The proposed Nepal Electricity Connectivity and Energy Efficiency Project consist of six investment components and one component on provision of expert services. The investment component supported by the ADB grant covers six main outputs each consisting of several activities. The first four major investment outputs are; (i) Transmission System Augmentation; (ii) Distribution System Enhancement; (iii) Distribution Loss Reduction; and (iv) Generation Plant Improvement. NEA proposed investment components based on its generation and rehabilitation plan, transmission system master plan and short-term distribution augmentation plan. The other two investment outputs are (v) Energy Efficient Lighting and (vi) Solar Power based Street lighting. The final component is to provide (vii) Expert Services assisting Public Private Partnerships (PPP) in distribution (i) Facilitation of Access to Clean Energy (Component 1): The following activities have been included under this components: a. Middle Marshyangdi - Dumauli Marshyangdi 132 kv transmission line and related substation works: This component is to improve the security of power evacuation from the newly constructed 70 MW Middle Marshyangdi hydropower station, and will provide general reinforcement through the important Damauli sub-station. Work will include construction of 19 km new double circuit 132 kv transmission line in Dumre-Damauli-New marsyangdi section, second circuit stringing on an existing 44 km 132 kv transmission line from Middle Marsynagdi to Marsyangdi, construction of a new 15 MVA, 132 kv/33 kv sub-station at Marshyandi, reinforcement of Damauli sub-station with construction of two 132 kv line bays, and extension of 132 kv line bays at Middle Marshyandi and Marshyandi switchyards. b. Butwal-Kohalpur 132 kv second circuit transmission line: This 200 km line is used to transfer power imported from India to Mahendranagr to the west and centre of the country. The project involves stringing of the second circuit of an existing 132 kv line built on double circuit towers, increasing the power import capacity by up to 100MW. c. Construction of Chapali Substation: This sub-project includes construction of a new 30 MVA, 132 kv/11 kv sub-station, installation of 15 km of underground 11 kv distribution line for 6 feeders at Chapali, and extension of two 66 kv GIS line bays at Lainchaur sub-station and installation of 7.5 km, 66 kv underground cable form Lainchaur to Chabahil. d. Expansion of Matatirtha Substation: The western part of Kathmandu Valley is relatively well served with 132 kv transformer capacity. However, the area experiences poor power supply due to the loading imposed on and length of 2 Three Year Interim Plan, Approach Paper (2064/65-2066/67), National Planning Commission, July 2007 1`

Nepal Electricity Connectivity and Energy Efficiency Project SSTA 7176 NEP: LARP 11 kv feeders, resulting in frequent feeder tripping and high losses. The project will reduce average 11 kv feeder length by converting the Matatirtha 132 kv switching station into a full 132 kv sub-station. It involves constructing additional 132 kv bays, installing two transformers, and constructing 33 kv and 11 kv lines to connect to existing circuits. e. Installation of Capacitor Banks: This project involves installation of approximately 220 MVAR of capacitor banks for reactive power compensation at eight transmission sub-stations. (ii) (iii) (iv) (v) (vi) Energy Access Quality Enhancement (Component 2): In order to improve distribution system reliability, quality of supply, and reduction of technical losses, NEA has proposed to construct eight new 33/11 kv, 6/8 MVA sub-stations at (i) Kusma, (ii) Burahathwa, (iii) Mainapokhar, (iv) Dhanusha/Dharampani, (v) Paraul; (vi) Baniyani; (vii) Mirchaiya; (viii) Dhikurpokhari/Banskot, and three new 11 kv switching substations at (i) Swoyambhu, (ii) Mulpani, and (iii) Mirmi, taking into account the technical urgency and optimization of revenue generation. This will reduce the incidence of scheduled and unscheduled supply interruptions, reduce losses, and improve supply quality. Clean Energy Plant Improvement (Component 3): Under this component Marsyangdi (69 MW) Gandak (15 MW) hydropower plants will be partially rehabilitated. This work will increase availability at both power stations and will reduce self-consumption at Lower Marshyangdi, providing an estimated additional 4 GWh of energy per year. This component is composed of (a) replacement of weir control system and modernization of excitation system at Marshyangdi; and (b) installation of trash rack cleaning system at Gandak for the improvement of plant availability. NEA is contemplating engagement of individual consultants to support it during the bidding process. Supply-side Energy Efficiency Improvement (Component 4): This component is proposed to address high technical and non-technical losses in medium voltage and low voltage distribution networks in Kathmandu Valley. A series of pilot project have been prepared by NEA; 16 11 kv feeders and downstream low voltage networks with unacceptably high losses have been identified and are to be rebuilt from the 11 kv feeder circuit breaker down to the customer service connection and revenue meter. These pilot projects will become model networks that can be replicated across Nepal. They will incorporate best international practice with respect to design, construction and commercial operation. To ensure that best practice is adopted, Individual consultants will be engaged to provide technical advice and support NEA for detailed design and implementation. Public Private Partnership in Distribution (Component 5): NEA is committed for introducing a franchising modality for the management and operation of selected distribution areas. NEA will identify three cities in which it will form strategic partnerships with private sector entities for management and operation of the urban electricity supply systems. ADB is presently supporting development of a franchising model, bidding guidelines, and related legal and bidding documentation. Loan proceeds will be used for expert services required to support the bidding process. Energy Efficiency in Lighting (Component 6): Presently NEA has a pilot CFL program targeting about 250,000 domestic consumers within 21 identified areas. This 2`

Nepal Electricity Connectivity and Energy Efficiency Project SSTA 7176 NEP: LARP investment component involves scaling-up of this program to nationwide program with an estimated 1 million high quality CFLs of capacities 9W, 12W and 20W. The Project will target phase-wise domestic consumers in all electrified areas with emphasis on high impact areas. It is expected that this program will free up a minimum of 10MW of power plant and a potential reduction of 23 GWh of consumption. Also, assistance will be provided for a public awareness campaign and for an implementation consultant (local) and other resources required for the Demand-side Management (DSM) cell to be established by NEA. (vii) Renewable Energy for Street-Lighting (Component 7): This component will facilitate the promotion of solar-powered street lighting in urban areas of Nepal and will fund a pilot project involving Bhaktapur, Kathmandu and Lalitpur areas. The identified areas are durbar squares in all three municipalities, areas around Pashupati Nath temple, Swyambhu and Boudha Nath Stupas, Thamel and New Road/Indra Chowk. The Project includes purchase of solar-powered street lighting systems, replacement/installation and setting up a system to ensure proper maintenance system. It is estimated that around 1,200 street lights will be replaced with solar which will reduce peak load demand of about 0.2 MW and save about 700 MWh per year. 1.2 Scope of Land Acquisition and Resettlement Plan 2. Resettlement-planning document is required to both Government and ADB in the development projects having scope of affecting and acquiring individuals/ community assets. In line with the policy guidelines of the Asian Development Bank (ADB), and Government s Land Acquisition Act (LAA) 1977, this Land Acquisition and Resettlement Plan (LARP) has been prepared for the project activities under the investment components of (a) Dumre- Damauli-New Marsyangdi Transmission Line (T/L) section under the Middle Marshyangdi - Dumauli Marshyangdi 132 kv transmission line and related Sub-station works, (b) Construction of Chapali Sub-station, and (c) Constructing Distribution and Switching Substations in different nine districts (Fig 1). Figure 1: Scope of Land Acquisition Resettlement Planning Dumre-Damauli- Marsyangdi 132 kv T/L Construction Construction of 30 MVA Chapali Substation Distribution and Switching Substation Construction 3. Land acquisition and resettlement planning however, may not require for (i) Stringing 132 kv second circuit between Middle Marsyangdi-Marsyangdi (44 km), (ii) Expansion, reinforcement and construction of new sub-stations at Damauli, Middle, Marsyangdi, and Marsyangdi (Aanbu Khairini),(iii) 132 kv second circuit stringing between Butwal-Kohalpur (aprox 200 km,), and (iv) Construction of distribution sub-stations and switching centers at Swyambhu, Synaja, Mahottari, (v) Expansion of Matatirtha sub-station at Kathmandu, and (vi) Installation of 220 MVAR of capacitor banks for reactive power compensation at eight existing transmission sub-stations. 3`

Nepal Electricity Connectivity and Energy Efficiency Project SSTA 7176 NEP: LARP 4. These project activities will be carried out on the available Government/NEA land or existing RoW. However, taking into account to likely losses of crops and trees the LARP has also provisioned compensation for the same. Similarly, land acquisition and resettlement plan also may not require for the investment component of (i) clean energy plant development, (ii) supply side energy efficiency improvement, (iii) public private partnership in distribution, and (iv) energy efficiency in lighting, and renewable energy for street-lighting as the activities are basically related to the replacement of available technical equipment/appliances and management aspects. Table 1-1 provides land acquisition requirement to implement the project activities. Detailed information on land acquisition and restriction requirement by investment components is included in Appendix A-1. Table 1-1: Land Acquisition and Restriction Requirement for the Project S.N Project Components Permanent Acquisition (in ha) 1, New Transmission Line and Transmission Substation Construction 2. Construction of Distribution Sub-station and Switching Centers Restriction to Use for RoW (in ha) Total (in ha.) 1.90 19.35 21.25 2.76 2.04 4.80 Total Estimated Area of Affected Land 4.66 21.39 26.05 Source: NEA, Technical Design and Census Survey Feb-Apr, 09 and census, Feb-Mar, 2009 Note A: One Bigha = 6918.86 sq.m., 1 ropani=508.74 sq.m, 1 ha = 9920.43 sq.m. Note B: The data presented in the table is based on preliminary census data which need to be updated during detail Design 5. As shown in the table above an estimated area of 26.05 ha of land is required to implement the project activities. Out of which, about 4.66 ha to be acquired permanently and another 21.39 ha of land will be restricted to use except for agriculture purpose. The land restrict for RoW will not be acquired permanently, and the cultivator will be allowed to use the land within the RoW only for agriculture purpose. The LAND Acquisition and Resettlement Plan is to ensure; (i) Types and extent of losses due to the project (ii) Principles and legal framework applicable for mitigation of losses, (iii) Entitlement matrix for compensation and other assistance based on the inventory of losses, (iv) Provisions for relocation assistance and restoration of house/businesses/income, (v) Budgets, and institutional framework for the implementation of the plan, and (vi) Responsibilities for monitoring of the LARP measures. 1.3 Projects Benefit and Impact 1.3.1 The Benefits 6. Opportunity for hydropower development, reduction of outage in the distribution network, and total network loss, supply of efficient and reliable energy are some of the key expected benefits of the Project. Implementation of the Project may also bring several positive impacts in the socio-economic scenario of the Project districts thereby contributing towards poverty reduction through enhancing economic activities in the area through creation of employment opportunities in the production sectors due to reliable and efficient electricity supply, and even employment opportunity during construction period. 1.3.2 The Impacts 7. A total of 314 households and 1654 persons likely to be affected by the proposed Project. The major impacts include permanent acquisition of land, restriction to use land (except to use for agriculture purpose), and acquisition of residential/commercial structures 4`

Nepal Electricity Connectivity and Energy Efficiency Project SSTA 7176 NEP: LARP along the proposed T/L RoW (Table 1-2). Appendix A-2 provides details on land acquisition and resettlement impact by investment component and locations. Table 1-2: Affected Households and APs S.N. Type of Effect Affected HHs (No.) Total Affected Persons (No) 1. Effect on Land 294 1551 2. Effect on Structures 20 103 Total 314 1654 Note: The data presented in the table is based on preliminary census data and estimation and will be updated during detail Design. 1.4 Measures to Minimize Impact 8. Appropriate measures have been taken by the project design in order to minimize acquisition and resettlement impact by using the available Government/NEA lands, wherever feasible and even by changing alignment route of the 132 kv new transmission lines. NEA has changed its design drawing of 132 kv new Middle Marsyangdi-Dumre-Damauli section from Angle Point 0 7 in order to avoid the settlement area and valuable land. 3 Likewise, Government/NEA land have also been identified and proposed for the implementation of some distribution sub-stations and switching centers in different districts (e.g. construction of switching stations at Mirmi- Syanja, Swyambu-kathmandu, and distribution sub-stations at Mahottari, Dhanusha, Mainapokhar, and transmission sub-station at Marsyangdi). NEA further aims to minimize the alignment route of the transmission line in critical sections based on community demand 4 as far as technically feasible and carrying out the constructionerection of towers and stringing transmission lines during off seasons. 1.5 Objective of the Land Acquisition and Resettlement Plan 9. The Resettlement Plan (RP) also mentioned in this document as Land Acquisition and Resettlement Plan (LARP), is guided by ADB Policy on Involuntary Resettlement, Land Acquisition Act of Nepal 1977, and other relevant Acts, Rules (e.g. Electricity Act 1992, Electricity Rule 1993) and Government policies, and guidelines related T/L construction. The main objective of LARP is to identify impact and to plan measures for mitigating various losses likely to occur due to the Project. It further aims to provide guidelines to address the identified acquisition and resettlement impact and to ensure compensation and other assistances to the affected households and people under the prevailing legal norms of GON in keeping with the ADB guidelines. The LARP is based on the general findings of field reconnaissance, socio-economic, and census survey of the Project affected household and their affected assets. The plan to be up-dated and finalized during the detailed design based on changes in technical design and verification of affected persons and their assets. 3 Transmission and System Operation, Transmission Line/Sub-station Construction Department, Project Development Department (i) Final Report on Detailed Feasibility of Dumre-Damauli 132 kv Transmission line February 2006, and (ii) Dumre- Damauli 132 kv Transmission Line (Alternative Route Alignment No.III) 4 In Dumre-Damauli Section, some of the community forest users groups, and local community have requested NEA to consult with them while fixing the alignment route during detail design and construction phase in order to further minimize the impact. 5`

Nepal Electricity Connectivity and Energy Efficiency Project SSTA 7176 NEP: LARP II. THE PROJECT LOCATION 10. The proposed Project activities will cover 14 administrative districts of all-five development regions of the country (Table 2-1). Key socio-economic characteristics of the project districts are included in Appendix B-1. 11. Construction and expansion/strengthening of transmission sub-stations (Chapali, Matatirtha, and Lainchaur including underground cabling) and two switching centers (Mulpani and Swyambhu) will be implemented at Kathmandu. The New 132 kv T/L will be implemented in Tanahu and Gorkha districts, and nine distribution sub-stations will be constructed in different districts across the country. A brief descriptions on the locations of each investment component is given in Appendix B-2. Table 2-1: Locations of Investment Components S.N. Development Region Districts Investment Component Type T/Line and S/S Construction Distribution S/S and Switching Centers 1. Eastern Development Region Jhapa & Siraha 2. Central Development Region Kathmandu, 3. Western Development Region Gorkha, Lamjung, Tanahu, Synaja, Kaski, Parbat 4. Mid-western Development Region Banke & Bardiya 5. Far-western Development Region Kailali and Kanchanpur Source: NEA, Technical Design and Census Survey Feb. 09 Apr. 2009 2.1 Locations of Transmission Line /Sub-station Components 2.1.1 Middle Marsyangdi Damauli-Marsyangdi 12. New 132 kv T/L will be constructed in Dumre-Damauli (18 km) section and for New Marsyangdi Sub-station (1 km) under Middle Marsyangdi-Damauli-Marsyangdi T/L and substation construction component. The proposed Dumre-Damauli T/L starts at Angle Point (AP) 0, located inside the compound of Damauli sub-station and passes through ward No. 1,3.5,6, and 11 of Vyas Municipality, ward No. 1 and 9 of Barbhanjyang VDC, Ward No. 1,2,3,4,6,7, and 8 of Ghansikuwa VDC (Tanahu District), and get connected with the tapping point (known as AP 39 of MMHEP T/L tower) located at Ward No. 8 of Chynagli VDC in Gorkha district. As per the technical design, most of the alignment route of Dumre-Damauli new T/L covers Tanahu district except from AP 21 to the tapping point (known as AP 39) located in Chyangli VDC of Gorkha. The proposed T/L mostly passes through the community forest and cultivating land. Similarly, the new T/L for proposed New Marsyangdi sub-station (approx 1 km) starts from the proposed sub-station location at Markichowck, Ward No. 3 of Aanbu Khairini VDC (Tanahu district) and crosses the agricultural land towards south and get connected at existing Marsyangdi Tower near Raudi Khola. 2.1.2 Chapali Sub-station 13. Chapali sub-station site is located at Chapali Bhadrakali VDC; ward No. 8, Bhangal, approximately 10 km north from the center of Kathmandu. As per the National Census 2001, 6`

Nepal Electricity Connectivity and Energy Efficiency Project SSTA 7176 NEP: LARP there are 903 households in the VDC with the total population of 4544 (comprising 2278 male and 2268 female). Over the last few years, urbanization within this vicinity has been increasing rapidly. Many new residential buildings have come up in this area and this area is of potential importance from distribution expansion viewpoint. The likely impacts associated with this sub-station construction appears to be less as the proposed sub-station area is already occupied with 132 kv and 66 kv transmission line Right of Way (ROW). About 35 ropani (approx 1.79 ha) of land will be required for the proposed sub-station and about 500 meters of existing access road from main road to the substation site shall be improved. 14. Another three project activities under the transmission components (expansion of existing Matatirtha S/S and Improvement of existing Chabahil sub-station and 33 kv underground cabling) will be implemented in Kathmandu. 2.2 Locations of Distribution Components 15. Project activities under the distribution component covers 10 administrative districts of the country. Out of them, two distribution switching center (Swyambhu and Mulpani) will be implemented in Kathmandu and rest of the project activities will be implemented in different nine districts. For this component, NEA had identified locations prior to the mobilization of the TA team. However, some of the locations were confirmed during the project preparation phase. While doing so, it was also approached to identify alternative locations for some of the sub-stations. NEA will construct distribution sub-stations in one of the proposed locations of each project district. Information on the proposed locations for the distribution sub-stations and switching centers is given in Appendix B-3. 7`

8 ` Nepal Electricity Connectivity and Energy Efficiency Project SSTA 7176 NEP: LARP