Resettlement Plan. Dong Chum 2 Hydropower Subproject. Da Bac District Hoa Binh Province. Submitted by:

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1 Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Ministry of Trade and Industry The World Bank Renewable Energy Development Project Resettlement Plan Dong Chum 2 Hydropower Subproject Da Bac District Hoa Binh Province Submitted by: HOANG SON ENERGY, CONSTRUCTION AND COMMERCIAL INVESTMENT JSC. Hoa Binh, June 2010

2 TABLE OF CONTENTS EXECUTIVE SUMMARY... v I. INTRODUCTION Renewable Energy Development Project Dong Chum Hydropower Plant II. SCOPE OF IMPACTS OF DONG CHUM 2 HYDROPOWER PLANT Impacts on Land Permanent impacts Temporary Impacts Impacts on Crops and Trees Impacts on Houses and Assets Impacts on Livelihoods and Income Other Impacts III. LEGAL FRAMEWORK AND ENTITLEMENTS OF AFFECTED PERSONS IV. SOCIO-ECONOMIC PROFILE OF AFFECTED COMMUNITY AND PERSONS Socio-economic Profile of Affected Community Socio-economic Profile of Affected Persons V. COMPENSATION AND ASSISTANCE Compensation Assistance provided for income restoration for affected persons VI. COMMUNITY CONSULTATION AND PARTICIPATION FROM LOCAL PEOPLE Community Consultation Participation from Local People Grievance Redressal Mechanism VII. MONITORING AND EVALUATION Internal Monitoring and Evaluation Independent Monitoring and Evaluation VIII. REPORTING IX. IMPLEMENTATION PLAN X. IMPLEMENTATION COSTS APPENDIXES Appendix 1: Permanentally impacted area of each household (Dong Chum commune, Da Bac district, Hoa Binh province) Appendix 2: The area of temporarily impacted land per households (Dong Chum commune, Da Bac district, Hoa Binh province) Appendix 3: Impacted trees, crops of each households (Dong Chum commune, Da Bac district, Hoa Binh Province) Appendix 4: List of compensated households as regulations of the provincial People s Committee (Dong Chum commune, Da Bac district, Hoa Binh Province)Error! Bookmark not defined. ii

3 Appendix 5: Minute of the community consultative meeting on compensation and assistance policy, phase 1... Error! Bookmark not defined. Appendix 6: Minute of the community consultative meeting on compensation policies, for the 2 nd phase... Error! Bookmark not defined. Appendix 7: Minute of community consultative meeting on compensation, assistance policies for the 3rd phase... Error! Bookmark not defined. Appendix 8: Minute of community consultative meeting on compensation and support policies for the 4 th phase... Error! Bookmark not defined. Appendix 9: Minute of Community consultative meeting for the 5 th time on compensation and supporting policies... Error! Bookmark not defined. Appendix 10: List of participants of indepth interviews and focus group discussion (Social economic survey)... Error! Bookmark not defined. Appendix 11: Profile of Dong Chum 2 hydropower plant... Error! Bookmark not defined. iii

4 LIST OF TABLES Table 1: Basic Technical Parameters of the Dong Chum Hydropower Plant Table 2: Total land area that is permanently acquired by the plant works: Powerhouse 2A and Powerhouse 2B Table 3: Types of lands temporarily impacted by households Table 4: Total land area that is temporarily acquired by the plant works: Powerhouse 2A and Powerhouse 2B Table 5: Number of trees and crops to be affected by the Dong Chum 2 Hydropower Plant Table 6: Entitlement Matrix Table 7: Compensation Costs for Various Types of Impacts Table 9: Costs for implementing assistance Table 10: Several basic indicators for internal monitoring and evaluation by the investor Table 11: Total estimated cost for implementing the RP of the Dong Chum 2 Hydropower Plant.. 39 iv

5 EXECUTIVE SUMMARY The Dong Chum 2 Hydropower Plant is constructed with two powerhouses: 2A located on the Chum spring and 2B on the Nhap spring in Dong Chum Commune, Da Bac district, Hoa Binh Province with design capacity of 9.0 MW. It is expected the construction of Hydropower plant be completed in 2013 and fully operated in late 2013 The construction process of different facilities under the plant will acquire permanently an area of 412,657.9 m2 (41.2ha) of lands and a temporarily an area of 8,634.9 m 2 (0.86 ha) ò lands for the purposes of temporary construction camps and staff houses, supporting areas, materials and machinery gathering parks, internal transportation roads to serve for the process before and during the construction of the Hydropower Plant. There are a total of 27 households (167 people) who are affected by the Dong Chum 2 Hydropower Plant, of which only one household whose land is covered permanently of 2,753 m 2 of land or 10.3 % of the total existing production land of the household, including: 2,000m 2 of agricultural land (rice-growing), 375m2 of fish-pond and 378m 2 of terrace land. The permanently affected lands consist of unused river-rocky land (49,251.4 m 2 ) and natural forest land (360,653.6 m 2 ). The forest land and the unused river rocky land that will be recovered are under management of Da Bac CPC. There are 26 households with land temporarily affected, including agricultural land (a total of 4,874.9 m 2 ), fish-pond (721 m 2 ), terrace field land (3,452 m 2 ) and 100 m 2 of residential land. No affected household has to relocate. Total number of crops and trees owned by affected households that affected is 1,950, including mainly bamboo trees (1,234), palm trees (286 trees), tea trees (100) and several other types of crops/trees. The compensation plan will be implemented in September 2010, and the income restoration and livelihood development programmes will be implemented in November The total cost of the compensation plan, including also the cost for income restoration for affected households under the Dong Chum 2 Hydropower Plant is at 345,098,500 VND. v

6 I. INTRODUCTION 1.1. Renewable Energy Development Project The objective of the Renewable Energy Development Project is to increase the supply of least-cost electricity to the national grid from renewable energy sources on a commercially sustainable basis in an environmentally and socially sustainable manner. The project will have three components: (1) the investment project implementation component, (2) the regulatory development component, and (3) the pipeline development component. The Investment Project Implementation component will provide (i) a re-financing facility to participating commercial banks for loans to eligible renewable-based projects below 30MW developed by private sponsors, and (ii) technical assistance for building the capacity of participating banks and project sponsors to prepare, appraise, finance, and implement renewables-based projects in accordance with the international best practices. This component will be implemented by the Project Management Board (PMB) for Rural Energy and Renewable Energy of the Ministry of Industry and Trade (MOIT). The component has two sub-components as described below. - Credit to Support Renewable Energy Investments: Private developers will develop subprojects of below 30MW based on small hydro, wind, and biomass in accordance with REDP criteria including environmental and social safeguards. Developers will commit at least 20% in equity funding and will approach participating banks for lending of up to 80% of each subproject s total project cost. The participating banks, which have been selected on a competitive basis, will appraise eligible renewables-based subprojects proposed by developers and provide loans to projects that meet all the requirements of the participating banks. The banks will lend to subprojects on commercial terms determined by market forces and will bear the full credit risk of the funds. Eligible loans will be re-financed up to 80% of participating banks lending or 64% of total project cost for each subproject. This means that participating banks will commit at least 16% of total project cost to each subproject as their own lending and project developers will contribute 20% as equity. Upon approval of an application for refinancing a loan, the respective participating bank will receive REDP (IDA) refinancing through MOF. REDP s contribution will be based on IDA funding lent to the Ministry of Finance (MOF) on IDA terms. It is estimated that some 20 subprojects (90% small hydro and 5% each wind and biomass) will be supported by the re-financing facility with an average capacity of about MW. When fully operational, these projects are expected to comprise about 210 MW of installed capacity producing about 880 GWh of electricity annually. - Technical Assistance for Investment Project Implementation: The technical assistance part of Component 1 will support the overall management of REDP, verification of eligibility for re-financing, and capacity building at PBs, developers/developers and others. This technical assistance facility will be 6

7 managed by MOIT s PMB. The TA facility will support the project sponsors by providing them the necessary skills to identify good projects and to prepare proposals for bankers, navigate the approvals process, and negotiate financing. This would include, inter alia, training for conducting feasibility studies, design optimization, construction management, operation, maintenance, the management of financial risks and takes into consideration environmental and social safeguards. The TA facility will support the PBs by enabling them to understand the risks of investment in renewable energy projects, supervise such projects with respect to safeguards, prepare credit policies for such projects, and appraise subprojects against those policies. The TA facility will also provide resources for project management of REDP by the PMB. If required, the TA facility would also assist the AU to evaluate projects against the eligibility criteria. The Resettlement Plan of Dong Chum 2 Hydropower Subproject is prepared in conformity with the approved Resettlement Policy Framework of Renewable Energy Development Project Dong Chum 2 Hydropower Plant Dong Chum 2 Hydropower Plant (Da Bac District, Hoa Binh province) is a kind of pathtype Hydropower plant, with design capacity of 9.0 MW. The Plant is constructed with two powerhouses: 2A located on the Chum spring and 2B on the Nhap spring in Co Phung and Nhap 1 villages, respectively, in Dong Chum Commune, Da Bac district, Hoa Binh province. The key works of the Dong Chum 2 Hydropower Plant consist of main dam, water-leading canal, water-taking gate, pressure-adjusting tank, factories and the 35 Kv transmission line. The key technical parameters of the works are as follows: Table 1: Basic Technical Parameters of the Dong Chum 2 Hydropower Plant Name of key works Basic Technical Parameters 2A 2B - Main dam 8.5m long gravity concretes 20.5m high gravity concretes - Reservoir Capacity 55x103 (m2) Surface area: 1.07 ha Capacity 224x103 (m2) Surface area: 3.31 ha - Canal leading water into m long uncovered m long uncovered the powerhouses concretes concretes - Pressure pipe 425m long pressure steel, 71.9m long pressure steel, 198.8m long pressure poles 47.5m long pressure poles - Water-taking gate 1 hold, sized 1.8x1.5 (m); 1 hold, sized 3x2.5 (m); flowing: flowing: 3.3 m3/s 9 m3/s - Hydropower plant 4 groups of machines, with total capacity of 9.0 MW, high end voltage of 6.3KV, - Transmission station 2 transformers 6.3/35KV, with capacity of 2500KVA each - Transmission line 35KV on the air, with the distance to the connected point of 2.5km 7

8 Name of key works Basic Technical Parameters 2A - Covering dykes 5.3m high and 605m long, top Not used width: 5m - Average electricity million KW capacity per year (E) 2B The timing for constructing the entire plant is expected to be between 2.5 and 3 years from the start of construction. The total investment cost of different works (excluding compensation cost at 345,098,500 VND) is at VND at the market price of May 2010, Of which: - Cost for civil works : VND - Equipment cost : VND - Management : VND - Cost for transmission line and station : 1,650,000,000 VND - Other costs : VND - Contingency cost : VND - Interest Costs in the construction phase : VND 8

9 Map of Dong Chum 2 Hydropower Subproject 9

10 II. SCOPE OF IMPACTS OF DONG CHUM 2 HYDROPOWER PLANT 2.1. Impacts on Land Permanent impacts The measures to minimize the permanent impacts on lands have been taken into consideration and taken such as lowering water level of the reservoir (from the height of 393m to 383 m), not leveling the existing road and extending the access road just wide enough to cater for the transporting vehicles and conducting close supervision the leveling works in order to avoid the wider influence on surrounding area. The facilities will be constructed away from the residential areas as well as the cultivated lands of households. In particular, the plant has had a separate port constructed to transport materials by river. At the same time, the transporting road and materials storage areas have been constructed in places away from where people live in order to avoid land acquisition and adverse impacts on the local community. Therefore, the Hydropower plant only affects permanently on 10.3 % of total area of production land owned by one (01) household with the area of 2,753 m 2 land (2,000 m 2 of land of growing rice, 375 m 2 fish-pond and 378 m 2 terrace field land). In total, there are 412,657.9 m 2 of area with permanent impact, of which 2,753 m 2 of land is owned by one household mentioned above and the unused river-rocky land area of 49,251.4m 2, and the remaining is the natural forest land of 360,653.5 m 2 - this is the largest part of permanently acquired land area (accounting for 87.39%) among all plant works. The forest area is under the control and management of Dong Chum CPC and the commune authority has yet to plan for developing this forest area so that it is currently still a poor forest with lots of bushes of very low economic values. The extent to which the land is affected by each of the plant works is as follows: - Reservoir area: One of the measures to reduce the area of acquired land is lowering water level of the reservoir, so that this area is just with permanently acquired land of 32,461.1m 2. Most of the acquired land is the unused river rocky land (with Powerhouse 2A of 12,086.1m 2 ; Powerhouse 2B of 20,000m 2 ) and only 375m 2 fish-pond in the Powerhouse 2B owned by a household is permanently affected in the area. - Main dam: Of the total of 6,000m 2 of permanently acquired land for the main dam, 1,000m 2 is in the Powerhouse 2A and 5,000m 2 in the Powerhouse 2B. Of the permanently acquired land above, the area of unused river and rocky land is 2,000m 2 and the natural forest land is 4,000m 2. - Transportation canal and road: This is the area with the largest proportion of permanently acquired land at 306,581m 2. The area of Powerhouse 2A has 209,203m 2 of land that is acquired and the entire area is natural forest land. Various sorts of acquired land in the Powerhouse 2B consist of: 97,378m 2 (of which natural forest land is 93,378m 2, 2,000m 2 of unused river and rocky land and 10

11 2,000m 2 of rice field land owned by a household this is the rice growing land of this household for years now. All of the affected lands are commune authority managed poor forest areas predominantly with bushes that have low economic values. Over the recent years, the commune authority has not determined as how to plan and use this area, and therefore the acquisition of the natural forest land does not bring much adverse impact to the local community in terms of economic values as well as the developmental planning. - Pressure pipe: This only affects natural forest land, with a total area of 7,203m 2, of which Powerhouse 2A acquires 4,203m 2 and Powerhouse 2B 3,000m 2. - Pressure tank: A total of 17,000m 2 of land is affected, of which the area of Powerhouse 2A is 7,000m 2 of unused river and rocky land, the area of Powerhouse 2B of 10,000 m 2 of natural forest land. - Powerhouse and OPY: This area is located away km - from the residential areas and therefore does not affect the land or assets of local households. There is a total area of 31,409,5m 2 with permanent impact, of which in the area of Powerhouse 2A, 5,000m 2 of unused river and rocky land and in the area of Powerhouse 2B, 26,409,5m 2 are acquired (25,514.7m 2 is natural forest land, 894.8m 2 is the unused river and rocky land). - Auxiliary area: In the area of Powerhouse 2B, there will be 378m 2 of land from tree planting owned by one household (the only household with permanently affected land) acquired, and currently there are 20 Buong trees have been planted between 1 and 3 years and 10 china trees (with a diameter of less than 10cm). Besides, the supporting area affects an area of 10,000 m 2 of forest land (Powerhouse 2B) and 1,354.8m 2 of forest land in the area of Powerhouse 2A KV transmission line: The distance to the connection point is fairly short (2.5km), so this area does not affect crops/trees and land. - Covering dyke: This is the facility with least amount of acquired land, of only 270.5m 2 of the uncultivated land in the area of Powerhouse 2A. The list of households to be affected by the Hydropower plant is included in the Annex 1. 11

12 Table 2: Total land area that is permanently acquired by the plant works: Powerhouse 2A and Powerhouse 2B Of which, Powerhouse 2A Of which, Powerhouse 2B Terrace Terrace field land, field land, Total Rice long-term Rice longterm Uncultivated Fishpond land land land pond land land Garden Residential Forest Fish- Residential Forest Items area of field and Uncultivated Garden field acquired land annual land (m 2 ) [7] land land and land land (m 2 (m 2 ) (m 2 ) (m 2 ) (m 2 ) (m 2 ) (m 2 ) (m 2 ) ) (m 2 ) tree (m 2 ) [b] (m 2 ) annual (m 2 )[j] [1] [2] [3] [6] [a] [c] [f] [4] planting [d] tree land (m 2 ) [5] planting land (m 2 ) [e] Reservoir 32, ,086, ,000 area Main dam 6,000 1,000 4,000 1,000 Leading 306, ,203 2,000 93,378 2,000 canal and operating road Pressure 7,203 4,203 3,000 pipe Pressure 17,000 7,000 10,000 tank Powerhouse 31, ,000 25, and OPY Supporting 11, , ,000 area Transmission line 12

13 Of which, Powerhouse 2A Of which, Powerhouse 2B Terrace Terrace field land, field land, Total Rice long-term Rice longterm Uncultivated Fishpond land land land pond land land Garden Residential Forest Fish- Residential Forest Items area of field and Uncultivated Garden field acquired land annual land (m 2 ) [7] land land and land land (m 2 (m 2 ) (m 2 ) (m 2 ) (m 2 ) (m 2 ) (m 2 ) (m 2 ) ) (m 2 ) tree (m 2 ) [b] (m 2 ) annual (m 2 )[j] [1] [2] [3] [6] [a] [c] [f] [4] planting [d] tree land (m 2 ) [5] planting land (m 2 ) [e] Covering dyke TOTAL 412, , , , , ,894.8 Total area of permanently acquired land in the area of 2A: 240,117,4m 2 Total area of permanently acquired land in the area of 2B: 172,162.5m 2 [1] + [a] (m 2 ) 375 [2] + [b] (m 2 ) 0 [3] + [c] (m 2 ) 0 [4] + [d] (m 2 ) 2,000 [5] + [e] (m 2 ) 378 [6] + [f] (m 2 ) 360,653.5 [7]+ [j] (m 2 ) 49,

14 Temporary Impacts During the construction of the two Powerhouses 2A and 2B, the construction of the canal and auxiliary area will cause temporarily impacts to a total of 8,634.9m 2 of land of different types. There are a total of 14 households whose have land temporarily impacted and the affected land is two-seasoned rice-growing land, with each household on average of temporary impact of 298.9m 2 ; 05 households with impact on fish-pond (on average each household is affected with 144.2m 2 ); 12 households with temporary impact on garden land (total of 1,572m 2 ); 02 households with impacts on terrace fields of small size (total area of 756m 2 ) and one household with impact on the area of 100 m 2 of residential land. The entire land area with temporary impact is under the use of 26 households. Table 3: Types of lands temporarily impacted by households Powerhouse 2A Powerhouse 2B Types of land with temporary impact owned Area No of Area No of by households (m 2 ) households (m 2 ) households Pond land Rice fields 4, Garden 1, Terrace field land, long-term and annual tree planting land Residential land Total 7, The list of households to be temporarily affected by the Hydropower plant is included in the Appendix 2. 14

15 Table 4: Total land area that is temporarily acquired by the plant works: Powerhouse 2A and Powerhouse 2B Of which, Powerhouse 2A Of which, Powerhouse 2B Terrace field Rice Terrace field Items Total area Rice Fishpond land land Garden Residential of field acquired land land (m 2 ) (m 2 ) (m 2 ) (m 2 ) [1] [2] [3] (m 2 ) [4] Reservoir area Main dam land, longterm and land pond land land Forest Fish- Garden Residential Uncultivated land (m 2 )[7] annual tree (m 2 ) (m 2 ) (m 2 ) (m 2 ) planting land (m 2 ) [5] [6] [a] [b] [c] field land land, term long- and Forest land (m 2 ) [d] annual tree planting land (m 2 ) [f] (m 2 ) [e] Leading canal 6, , and operating road Pressure pipe Pressure tank Powerhouse and OPY Supporting area 1, Transmission line Covering dyke TOTAL 8, , , Total area of temporarily acquired land in the area of 2A: 7,931.9 m 2 Total area of temporarily acquired land in the area of 2A: 703 m 2 [1] + [a] (m 2 ) 721 [2] + [b] (m 2 ) 2,275 [3] + [c] (m 2 ) 100 [4] + [d] (m 2 ) 4,782.9 [5] + [e] (m 2 ) 756 [6] + [f] (m 2 ) 0 Uncultivated land (m 2 )[j] 15

16 [7]+ [j] (m 2 ) 0 16

17 2.2. Impacts on Crops and Trees Total number of crops and trees to be affected as a result of the Hydropower plant is 1,950 of different kinds owned by 24 affected households, predominantly the bamboo trees (1,234), palm trees (286) and several other fruit trees and crops. The construction of canal and operating road and other supporting facilities has brings the biggest part of impact on the crops and trees owned by the households. Table 5: Number of trees and crops to be affected by the Dong Chum 2 Hydropower Plant Total (trees/crops) Fruit trees China Palm trees Tea Bamboo Buong trees trees trees trees (tree) (tree) (tree) (tree) (tree) (tree) 1, , Almost all trees and crops are in the stage of harvesting. Also, the branch Powerhouse 2B of the Hydropower plant causes permanent impacts on the area of 2,000m2 of water rice of one household. The acquisition of the said area will only occur after local residents have completed harvesting their rice and other fruit trees and crops. For wooden trees, apart from receiving cash compensation, local residents will still have enough time to harvest such trees. The list of households with trees and crops being affected by the Hydropower plant is included in the Annex Impacts on Houses and Assets Due to efficient application of measures to reduce the affected land, such as the construction of various facilities away from residential areas, careful attention being paid to the construction and widening the transporting and operating roads by Dong Chum 2 Hydropower Plant investor with a view to avoiding impacts on houses and assets of the local residents. As such, Dong Chum 2 Hydropower Plant has no impact on houses or assets whatsoever of local households Impacts on Livelihoods and Income Dong Chum 2 Hydropower Plant causes a permanent impact to 10.3 % of the existing production land owned by one household, and temporary impact to 721m 2 of fish-pond owned by 5 households and m 2 of production land of 14 households during the construction of Hydropower plant. Because the terrain of the area affected by Hydropower Plant is mostly sloping, rocky and rough, local residents hardly catch fish in this area. Thus, the plant will not affect the local fisheries. In fact, local residents catch fish in rivers and springs with flat terrains far away from the reservoir. 17

18 2.5. Other Impacts Apart from above-mentioned impacts, the Dong Chum 2 Hydropower Plant causes no other such impacts to local households and community. A large proportion of plant facilities is located away from local residential area and community, these facilities will not affect business conditions and other cultural structures and assets and infrastructure of local community. The largest area acquired is the forest land. However, as this area is the poor and type-3 forest. The authority who is mandated to manage and use the forest area is the CPC and indeed the commune leadership has not invested into production or planting in this area. As a result, the acquisition of forest land will not affect employment of forestry workers and officers and other stakeholders alike. 18

19 III. LEGAL FRAMEWORK AND ENTITLEMENTS OF AFFECTED PERSONS As the resettlement plan of Dong Chum 2 small Hydropower Plant is prepared under the scope of the Renewable Energy Development Project, the legal framework for compensation and resettlement activities will be based on Resettlement Policy Framework (RPF) that has been agreed upon for the REDP. Legislation and policies applicable for implementation of compensation and resettlement include (i) policies of World Bank, (ii) existing policies on compensation, assistance, resettlement of the Government of Vietnam; and (iii) procedures on compensation, assistance and resettlement of local government (Hoa Binh province). As regards the World Bank s policies, the OP 4.12, Involuntary Resettlement applies. Key features of OP 4.12 have been detailed out in RPF. Regulations on compensation, assistance and resettlement of Vietnamese Government are applied in the implementation of Resettlement plan of the Dong Chum 2 Hydropower Plant, including: 1. Law on Land 2003, promulgated on 26 th November Decree 181/2004/ND-CP dated October 29, 2004 of the Government on the implementation of the Land Law. 3. Decree no 188/2004/NĐ-CP dated November 16, 2004 by the government on methods of defining land prices and price brackets of land types. 4. Circular No. 114/2004/TT-BTC of November 26, 2004 guiding the Implementation of the Government's Decree no. 188/2004/ND-CP of November Decree 197/2004/NĐ-CP dated 03/12/2004 on the compensation and support and resettlement when the State acquired land. 6. Circular No. 116/2004/TT-BTC guiding the implementation of the Government's Decree No. 197/2004/ND-CP on compensation, support and resettlement when land is recovered by the State. 7. Decree no 17/2006/NĐ-CP dated January 27, 2006 by the government on amending and supplementing a number of articles of the decrees guiding the implementation of the law on land and Decree 187/2004/NĐ-CP dated 16/11/2004 of the Government on Guiding the Implementation of the Government's Decree no. 187/2004/ND-CP of November 16, 2004 on Transformation of State-owned Companies into Joint-Stock Companies. 8. Circular No. 69/2006/TT-BTC amending and supplementing the Finance Ministry's Circular No. 116/2004/TT-BTC which guides the implementation of the Government's Decree No. 197/2004/ND-CP on compensation, support and resettlement upon land recovery by the State. 19

20 9. Decree 123/2007/ND-CP adjusting Decree 188/2004/ND-CP of November 16, 2004 on the methodology of setting land prices and building land price tables. 10. Decree No. 84/2007/NĐ-CP on supplementing on issuance of certificate of land use-right, revoke land, implementation of land use-right, sequences, compensation formalities, assistance, resettlement in cases State revoking land and settle complaint of land matter, issued on 25 May Inter-ministerial circular No. 14/2008/TTLT/BTC-BTNMT on guiding implementation of several articles of the Decree No. 84/2007/NĐ-CP, promulgated on January Decree No. 69/2009/ND-CP dated August 13, 2009 of the Government additionally providing for land use planning, land prices, land recovery, compensation, support and resettlement. The current regulations on implementation of compensation, assistance and resettlement of local government (Hoa Binh province) are applied in the Resettlement Plan of the Dong Chum 2 Hydropower Plant, including: 1. Decision No. 40/2009/QD-UB, dated 25 December 2009 of Hoa Binh PPC, detailing price table for land of different kinds in 2010 in Hoa Binh province 2. Decision No. 31/QD-UB, dated 1 November 2008 of Da Bac DPC on promulgating detailed regulations on (milestones) of regions, positions of residential land, land for non-agricultural production and agricultural land within Da Bac District, Hoa Binh province. 3. Decision No. 41/2009/QD-UBND, dated 28 December 2009 of Hoa Binh PPC, regulating on compensation, assistance and resettlement upon land acquisition by the State within Hoa Binh province. In order to reconcile the policies of WB and of the Vietnamese Government and the regulations on compensation, assistance and resettlement of local government, the following key points of the Resettlement Policy Framework of REDP have been agreed upon by the Land Clearance Compensation Council of the District, Investor of Dong Chum 2 Hydropower Plant, commune leadership and affected persons. Several principles that apply to compensation, assistance in the Dong Chum 2 Hydropower Plant 1. During the planning phase and design phase, it is important to reduce as much as possible the land acquired, and avoid impacts on assets of local households. 2. The households with affected residential land, agricultural land, crops and trees and other impacts in the construction area will receive full compensation, assistance for livelihood restoration at least to the same level before the impacts, including incomes and livelihood development opportunities. 20

21 3. Lack of legal documents on land use rights (including residential land, agricultural land and other types of land) as well as other legal papers on assets is not a bar to receive compensation and assistance. 4. The plan for acquisition of land and related assets, compensation, assistance and resettlement plan and ethnic minority development plan will be implemented in close and regular consultations with community and affected persons. 5. Land, crops and trees and other assets that are acquired and affected will be compensated at the replacement cost, without reduction of depreciated or transfer values or any other such reduction. 6. Poor households and those with women being householders, ethnic minority households and other policy beneficiaries, vulnerable households will be supported in accordance with current regulations of the local government. At the same time, investors will provide other assistance depending on outcomes of the community consultation with this group of households. The Entitlement Matrix for affected for different sub-projects under the REDP has been specified in the RPF. Based on this Entitlement Matrix, the Entitlement Matrix for affected households under the Dong Chum 2 small Hydropower Plant is as follows: Table 6: Entitlement Matrix Item Type of Loss Application Definition of entitled person Compensation, assistance and resettlement policies More than 10% Households, 1. Land compensation for the lost of area of the individuals or land and its associated assets at available organizations with full replacement cost. agricultural land. agricultural land 2. Receiving assistance for Permanent affected by income rehabilitation and loss of different subproject livelihood development (specified 1 agricultural land facilities (01 affected in item 7) household) Impact less then 10% of area of the existing 0 agricultural land. 2 Permanent impact on forest land Poor, type three and nonprotective forest. The authority entitled to use forest land (Dong Chum CPC) Replacement planting of the area equal to that acquired at the upstream area 21

22 Item Type of Loss Application Definition of entitled person Compensation, assistance and resettlement policies Persons with Compensation of land at the 3 Impact on garden land Impact garden land on affected garden land (12 replacement cost, of crops and trees at the market price households) Persons with crops Compensation at the market 4 Impacts crops trees on and All crops and trees affected by the plant facilities and trees on affected land area (24 households) price. If the affected crops and trees must be transported, then the compensation cost must cover also the transportation cost and actual arising costs. Households with 1. Compensation as per leasing 5 Temporary impact on agricultural land Agricultural land affected during the construction of works agricultural land with temporary impact (14 households) price of land at the time of impact, based upon the Decision No. 41/2009/QD-UBND, dated 28 December 2009 of Hoa Binh PPC 2. Bidders return land with quality equal to originally to households Households with 1. Compensation as per leasing fish-bonds affected price of land at the time of impact, during construction based upon the Decision No. process (05 41/2009/QD-UBND, dated 28 6 Temporary impact on aquatic product raising land The land for raising aquatic products is affected during the construction of works households) December 2009 of Hoa Binh PPC 2. Affected persons are to participate in the fish-raising training courses. 3. Affected persons receive assistance for digging ponds (not exceeding 1,000,000 VND/household) 4. Affected persons receive assistance for raising fish (500,000VND) 22

23 Item Type of Loss Application Definition of entitled person Compensation, assistance and resettlement policies 1. Assistance provided to stabilize One household life conditions by cash equivalent loses 10.3% of total to 30kg rice/person/month, to all area of cultivated persons in the household within land of the the period of six months in household accordance with local market price (The RPF stipulates 3 months, however, the investor supports six months in accordance with regulations of the PPC) 7 Assistance Assistance provided to households seriously affected (more than 10% of total production land) 2. Assistance provided in form of vocational training for one member of the affected household (by cash): 5,000,000 VND. 3. Assistance provided to stabilize life conditions: 1,500,000 VND. 4. Priority given to participate in development programmes held by international, national, or local entities. 5. To participate in fish-raising programmes run by investor (training on fish-raising, assistance on digging pond with 1,000,000 VND and assistance to purchase fish seeds of 500,000 VND. Poor households Assistance provided to poor and vulnerable households and those with women being householders, ethnic minority households (21 1. Assistance provided for stabilizing life conditions: 1,500,000 VND/ household. 2. To participate in fish-raising programmes run by investor if households) they so wish. 23

24 Type of Definition of Item Application Loss entitled person 8 Bonus Affected persons voluntarily transfer land on a timely basis to the facility Compensation, assistance and resettlement policies Minimum bonus of 2,000,000 VND and minimum bonus will be promulgated by the provincial government. 24

25 IV. SOCIO-ECONOMIC PROFILE OF AFFECTED COMMUNITY AND PERSONS 4.1. Socio-economic Profile of Affected Community Located 20km away from Hoa Binh city, Da Bac District with district center being Da Bac town and 21 communes, including Dong Nghe, Suoi Nanh, Muong Tuong, Muong Chieng, Dong Chum, Tan Pheo, Doan Ket, Tan Minh, Trung Thanh, Yen Hoa, Cao Son, Tien Phong, Vay Nua, Hao Ly, Tu Ly, Hien Luong, Toan Son, Dong Ruong, Giap Dat. Among these, Dong Chum is the only commune affected by Dong Chum 2 Hydropower Plant. The Dong Chum commune is comprised of 9 villages: May 1, May 2, Na Loc, Pa Che, Co Phụng, Nhap 1, Nhap 2, Ha village and Chanh village. The commune has the natural area of 5,515ha, and total number of households across the commune is 622 (with 2,887 people), of which 544 households (with 2,585 people) are Tay ethnic minority and 78 households (with 290 people) are Kinh (Vietnamese) people. With per capita income of 183,000VND/person/month, Dong Chum commune is also one of the poor communes of Da Bac District, and the poverty rate in 2008 was 52% (323 out of 622 households). Currently the commune benefits from poverty elimination programmes of the State, such as Programmes 135 and 472. Regarding agricultural production, local residents mainly grow rice, maize, cassavas, but as the farming method of local people is still outdated with traditional farming techniques being widely used, poor access to knowledge and information, the farming productivity is very low and product values are poor. Total whole commune food output in 2008 was 2,400 tons. It is the under-developed techniques that the breeding of local people is not commercially oriented but solely for self-consumption or bartering among local households, with no single household implementing large-scale breeding programmes (farmhouse). Currently, total cattle and poultry of the entire commune are: buffalos: 599, bulls: 588, pigs: 12,527, goats: 215, poultry: 12,527. Diseases infected to cattle and poultry on a regular interval cause serious troubles to economic life of local people and hence the big concern for local government at the moment. Cultivating and breeding are still main sources of income of the people in the commune, except for some cases where cadres can have irregular income and several households can make extra earnings through small business practices. The forest protection of local people is pretty good. Currently, in the whole commune, nearly 100% of households have been assigned with autonomy the tasks of planting and protecting forests with total area of 3,639.2ha. Commerce and service industries start to emerge in the local area but their scope is still limited, mainly catering for necessities and foodstuffs (there are about 20 households and entities). The buying and selling market has not taken full shape, in most cases people trade for products with one another. Other food products are purchased by businesspeople using negotiation approaches. 25

26 Currently, the electricity has been brought to 100% households of Dong Chum commune despite regular electric cuts in the whole commune or alternate cuts among villages and hamlets. The traffic in the commune and across communes is quite convenient, although there are some very rough roads especially in rainy and flooding seasons. According to statistics of Da Bac BOET, in the entire Dong Chum commune, the proportion of schoolage children attending schools is 100% and only 1.5% of students who drop out in midway. The number of pre-school students is 155 divided into 5 classes; the number of primary students is 250 divided into 9 classes. The number of lower secondary students is 185 divided into 6 classes; The number of illiterate local residents is 50; the number of non-vietnamese speaking people is 30. The traditional customs and practices have still been maintained along the current life of local people Socio-economic Profile of Affected Persons The total number of affected households in the subproject is 27 who are all Tay EM people (with 167 people) living in two villages: Co Phung and Nhap 1. The socioeconomic surveys have been conducted with all (100%) affected households, mainly through qualitative methods (16 in-depth interviews/survey of socio-economic parameters of the relevant households; 6 focus group discussions- 3 group discussions in Co Phung village and the other three in Nhap 1 village; and 5 community consultation meetings in Co Phung village and the other three in Nhap 1 village) Representatives of women s associations, farmers association, village leaders, commune leadership, fatherland, some affected and unaffected households participate in in-depth interviews; focus group discussions have been conducted in two villages with participation of leader and vice-leader of the relevant villages, representatives of women s associations in the two respective villages and the whole of affected households. Also, there are community consultation meetings held in the two villages with participation from leadership of Da Bac District Resettlement Compensation Council, representatives of commune authority, of project owner, and local ordinary people in Co Phung village... all of which have helped in collecting socio-economic data of affected persons in an accurate and full manner. The attached annexes include: Annex 10 (in-depth interview); Annexes 5, 6, 7, 8, 9, 10 (minutes of community consultation meetings). The socio-economic data which has been analyzed and interpreted shows the income structures of affected households as follows: Primary income Agricultural farming (food crops, Accounting for 53.8% of total fruit trees, long-term trees) income Breeding (fish, cattle and poultry) Accounting for 20.5% of total income Subordinate Hired working Accounting for 16.7% of total income income Small business Accounting for 9% of total income 26

27 At the moment, the commune is being provided with poverty alleviation policies by the State such as the Programmes 135 and 472. The per capita income of affected households in 2008 was 9,126,000 VND per annum (below poverty standard). On average, each household has 6 members and 21 out of 27 households are poor. The main causes for the poverty are (i) outdated farming and breeding customs (91%), (ii) lack of investment capital (88.7%), (iii) regular and persistent diseases (83.7%), and (iv) lack of market information and labor resources (54%). Different types of primary food crops of affected households include: Number of households growing rice 100% Number of households growing maize 88.2% Number of households growing cassavas 68.5% Rice and maize are key food crops that bring the primary income to the affected households, with average per capita food output of kg/year. The average area of cultivated land per household is 1.45ha and there are lots of land that can be reclaimed. Other types of crops/trees: Bamboo trees Palm trees Tea trees Persimmon trees Banana trees 74.2% of households currently growing 62.8% of households currently growing 37.1% of households currently growing 25.7% of households currently growing 100% of households currently growing In addition, households grow fruit trees such as persimmon trees, jackfruit trees, custardapple trees, longan trees As regards the breeding practices of affected households, they raise lots of types of cattle and poultry and the most common way as yet is to free animals in the field without locking them into cages. There is no single household that raises animals in a commercially oriented manner but solely for self-consumption or trading for necessities. Due to the fishraising movement over the last three to four years, lots of affected households have had their fish ponds (15 out of 27 households) with average area of 500 to 650m 2 each, of which 4 households have their total fish-raising areas of between 800 and 1150m 2, but due to lack of knowledge, experiences and market information, the economic efficiency has not by far high. Buffalos 57.1% of households currently growing raising Bulls 45.7% of households currently growing raising Pigs 71.7% of households currently growing raising In-pond fish 76.9% of households currently growing raising Goats 37.1% of households currently growing raising Chickens 100% of households currently growing raising Of affected households, 6 households are currently raising 3 buffalos, 4 raising 3 bulls, 12 raising 4-5 pigs. 27

28 Domestic equipment of affected households include: Motorbike 22.8 % (8/27 households) TV set 23.6 % (9/27 households) Telephone 34.2 % (12/27 households) Radios 40% (14/27 households) Cookers 14.2 % (5/27 households) Water pumps 8.5 % (3/27 households) 100% of affected households use electricity. Most of local people use firewood for cooking and warming and very few use coal and gas. Currently affected households frequently use rain water and well water for their daily living activities and some of them take water from spring using pipe for domestic use. In the project area, the average age of heads of households is 48.5, of whom 97.4% is male. 6/35 of households heads have 12/12 qualifications; 13/35 have finished from grades 7 to 9; and the remaining 16 heads of households have lower than grade 7 qualification. There are 4 heads of households who are cadres of villages and communes while all other heads do the farming. All heads can communicate in general language, Kinh. 45.7% of heads of households leave communes on a monthly basis, 35.7% leaves communes on monthly basis, mostly to visit their relatives and purchase production and consumption equipment. Heads of households and family members have close relationships with the outside society. The sanitation conditions have not been paid attention to, with some having normal toilets and a limited number of more wealthy households building closed toilets, due to economic constraints, while most of others are just temporary with palm leaves around or bamboo screens, which are unpleasing to the eyes, subject to low sanitation conditions and higher risks of diseases. According to the next year s development plan, the commune government strives to expand the cultivated land to 1.85ha per household (compared to current level of 1.44ha) with an aim to improving food output from 3.85 tons per household to 4.34 tons per household. At the same time, it will strive to develop large flocks of animals and poultry using farmhouse model. 28

29 V. COMPENSATION AND ASSISTANCE 5.1. Compensation Cut off date: the date that is used for inventorying losses as a result of Dong Chum 2 Hydropower Plant to accommodate the compensation computations is October 11, 2009 (the completion date of the detailed measurement survey of affected households). This date is widely informed to the relevant villages and affected households one week in advance with two aims: (i) to allow for the householders and their members to take inventory of losses together with Da Bac District Resettlement Compensation Council, and (ii) to confirm with local community a reality that after this date those who come and live in the project area or any arising assets that are affected (trees and crops...) will not be compensated. Replacement cost Market survey on prices of land, crops (of various types), fruits, vegetables, land structures, labor power cost, cost of construction materials in the affected area and surrounding area has been conducted by a group made of representatives of bidder, farmers association and women s association, Da Bac District Resettlement Compensation Council and representatives of 6 householders representing 27 affected households. The survey findings show that, currently in the affected area there has been no market price, and local people have not traded land, houses or crops (in most cases, local households give their children part of their lands, houses when they get married). Therefore, the unit cost for compensation for land and its assets is determined based upon Decision No. 41/2009/QD-UBND, dated 28 December 2009 of Hoa Binh PPC, regulating on compensation, assistance and resettlement upon land acquisition by the State within Hoa Binh province (This Decision is based on the Decision No. 69/2009 of the Central Government). The cost frame has been discussed with affected households which show that the said cost is reasonable for the investment level on land (including caring cost) and has been completely agreed upon by representatives of affected households. As regards natural forest land, as indicated earlier, this is the poor forest land with low economic value. However, as approved by the Da Bac District Resettlement Compensation Council and commune authority, the investor has planted a replaced forest area in the upstream region sizable to the acquired forest land and the same has been handed over to commune authority, so that the investor will not have to make compensation in cash for this forest area. The unit cost for compensation is widely disseminated in the community consultation programmes and unanimously agreed upon by all affected households. There are 5 steps in the compensation procedure as shown below: 1. Applying the cost table that has been agreed by affected persons to the loss inventorying results (this must have been deemed correct and true by affected households). 29

30 2. Disseminating results of cost-applied compensation for each single household to the general public. 3. Submitting to the Da Bac DPC for approval (compensation options). 4. Disseminating the compensation option approved by Da Bac DPC. 5. Implementing compensation in the community. Loss-inventorying was conducted in October 2009 and the implementation of compensation is expected to be in August The estimated costs for compensation by types of impacts are as follows: Table 7: Compensation Costs for Various Types of Impacts Type of Impact Quantity Unit Cost (VND/m 2 ) Total (VND) Permanently Affected land 2,753 m 2 61,280, Rice field land 2,000.0 m ,000,000 Terrace field land m ,780,000 Fishpond land m ,500,000 Temporarily Affected land 7,931.9m 2 168,004,500 Rice field land 4,782.9 m 2 25, ,572,500 Terrace field land m 2 10,000 7,560,000 Garden land 1,572.0 m 2 16,000 25,152,000 Fishpond land m 2 20,000 14,420,000 Residential land m 2 13,000 1,300,000 Affected crops and trees 1,950 trees 16,374,000 Affected crops and trees 1,950 trees Depending on types of 16,374,000 trees and their tenures Total compensation costs 245,658, Assistance provided for income restoration for affected persons In conformance with the Resettlement Policy Framework under REDP that has been approved, and based on outcomes of community consultation, assistance to income rehabilitation will be provided as follows: 1. Providing support in form of rice for the household with area of acquired land more than 10% of total cultivated land with the assistance by cash equivalent to 30kg rice/person/month, to all persons in the household within the period of six (06) months in accordance with local market price. Besides, this affected household will also receive assistance in form of vocational training for one member of the affected household by cash of 5,000,000 VND and assistance provided to stabilize life conditions of 1,500,000 VND. This household is also given priority to participate in development programmes held by international, national, or local entities; and to participate in fish-raising programmes run by investor (training on 30