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The project was screened as B/1, requiring an environmental analysis of the main impact of the proposed rehabilitation and an environmental audit of the station. These were undertaken by international consultants and reviewed by the Bank's environmental specialists. Also a member of the Environmental Appraisal Unit visited the plant and had discussions with the plant management and engineers.
To demonstrate the environmental benefits of the fluidised bed boiler technology, the environmental impact of two rehabilitation scenarios were compared:
(i) standard rehabilitation of the existing boiler with no design changes, and
(ii) replacement of the existing boiler with a fluidised bed boiler.
The economic analysis included a cost estimate of the environmental consequences resulting from pollutant emissions (particulates, sulphur dioxide, nitrogen oxides and carbon dioxide). In the financial analysis, consideration was given to the current and future pollution fees which could be imposed on the Starobeshevo power plant by the Ukrainian environmental authorities.
The project will have a net positive impact on the environment by utilising "clean coal technology", which can efficiently burn low-quality coal and schlamm (residue of coal washing), the only available fuels in the region. The boiler will be designed to meet European Union and Ukrainian standards for air emissions.
Mitigation measures identified during the environmental investigations have been included in the Environmental Action Plan for the station. These cover air emissions, water discharge, oil and chemicals storage, ash ponds and fire protection. A twinning technical cooperation project will provide assistance to the Starobeshevo power plant in identifying technical, environmental and managerial improvements at the station and implementation of the Environmental Action Plan.
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