Chemical Industry Energy Efficiency and Emission Reduction Project (ADB-47051-002)

Regions
  • East Asia and Pacific
Geographic location where the impacts of the investment may be experienced.
Countries
  • China
Geographic location where the impacts of the investment may be experienced.
Financial Institutions
  • Asian Development Bank (ADB)
International, regional and national development finance institutions. Many of these banks have a public interest mission, such as poverty reduction.
Project Status
Completed
Stage of the project cycle. Stages vary by development bank and can include: pending, approval, implementation, and closed or completed.
Bank Risk Rating
A
Environmental and social categorization assessed by the development bank as a measure of the planned project’s environmental and social impacts. A higher risk rating may require more due diligence to limit or avoid harm to people and the environment. For example, "A" or "B" are risk categories where "A" represents the highest amount of risk. Results will include projects that specifically recorded a rating, all other projects are marked ‘U’ for "Undisclosed."
Voting Date
Nov 3, 2015
Date when project documentation and funding is reviewed by the Board for consideration and approval. Some development banks will state a "board date" or "decision date." When funding approval is obtained, the legal documents are accepted and signed, the implementation phase begins.
Borrower
People's Republic of China, China National Chemical Corporation Group
A public entity (government or state-owned) provided with funds or financial support to manage and/or implement a project.
Sectors
  • Energy
  • Industry and Trade
The service or industry focus of the investment. A project can have several sectors.
Investment Type(s)
Loan
The categories of the bank investment: loan, grant, guarantee, technical assistance, advisory services, equity and fund.
Investment Amount (USD)
$ 100.00 million
Value listed on project documents at time of disclosure. If necessary, this amount is converted to USD ($) on the date of disclosure. Please review updated project documents for more information.
Loan Amount (USD)
$ 100.00 million
Value listed on project documents at time of disclosure. If necessary, this amount is converted to USD ($) on the date of disclosure. Please review updated project documents for more information.
Project Cost (USD)
$ 181.73 million
Value listed on project documents at time of disclosure. If necessary, this amount is converted to USD ($) on the date of disclosure. Please review updated project documents for more information.
Bank Documents
Primary Source

Original disclosure @ ADB website

Updated in EWS May 23, 2024

Disclosed by Bank Mar 30, 2017

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Project Description
If provided by the financial institution, the Early Warning System Team writes a short summary describing the purported development objective of the project and project components. Review the complete project documentation for a detailed description.

According to ADB website, the ADB is helping People’s Republic of China cut toxic emissions and power consumption at plants of the China National Chemical Corporation—the country’s largest producer of energy-intensive plastics products. The project is funding the testing of a mercury-free catalyst for PVC production at one plant and an energy efficiency system at another, which will cut power use and greenhouse gas emissions.

The proposed Chemical Industry Energy Efficiency and Emission Reduction Project will support demonstration of innovative technologies to improve energy efficiency and reduce emissions of pollutants from various plants belonging to the China National Chemical Corporation Group (ChemChina). It will also develop an innovative financing structure to leverage commercial cofinancing and mainstream energy service company (ESCO) participation from the beginning of project implementation. The innovative financing structure will be developed and firmed up during the early stage of the project preparatory technical assistance (PPTA) implementation.

The proposed first two subprojects include (i) demonstration of a new technology by Dezhou Shihua Chemical Co., Ltd. (DSC) to retrofit its polyvinyl chloride (PVC) production facility to reduce energy consumption by 40% and eliminate the use of mercury as a catalyst; and (ii) retrofitting the caustic soda production chain of Haohua Yuhang Chemical Co. Ltd. (HYC) with the current state-of-the-art technology that will consume 30% less energy.
As per the International Energy Agency, caustic soda and PVC production consumes about two-thirds of total primary energy in the chemical industry worldwide. By targeting these two energy-intensive production processes, the project aims for larger impact on energy efficiency and emission reductions in chemical industry in the PRC.
Similarly, by mainstreaming ESCO in the project's structure, the project will address a key barrier that has so far prevented industry-specific ESCO participation in energy efficiency retrofits in energy-intensive industries in the PRC. If proven successful, it may unleash ESCO model across energy-intensive industries.

Early Warning System Project Analysis
For a project with severe or irreversible impacts to local community and natural resources, the Early Warning System Team may conduct a thorough analysis regarding its potential impacts to human and environmental rights.

The Project has been classified by ADB as environment category "FI". The CGY and DSC subprojects have been classified by ADB as environment category A.

Investment Description
Here you can find a list of individual development financial institutions that finance the project.

ADB Loan 3308-PRC from the Ordinary Capital Resources amounting to US$ 100.00 million. Another loan from a Commercial - Local Bank amounting to US$ 81.73 million.

Financial Intermediary
A financial intermediary is a bank or financial institution that receives funds from a development bank. A financial intermediary then lends these funds to their clients (private actors) in the form of loans, bonds, guarantees and equity shares. Financial intermediaries include insurance, pension and equity funds. The direct financial relationship is between the development bank and the financial intermediary.
Private Actors Description
A Private Actor is a non-governmental body or entity that is the borrower or client of a development project, which can include corporations, private equity and banks. This describes the private actors and their roles in relation to the project, when private actor information is disclosed or has been further researched.

As stated by Bloomberg, China National Chemical Corporation Limited manufactures chemical products. The Company develops, manufactures, and sells advanced chemical materials, specialty chemicals, basic chemicals, and other products. China National Chemical also produces agrochemicals, tires, rubber products, and other products.

Haohua Yuhang Chemical Co.,Ltd. was founded in 2001. The Company's line of business includes the manufacturing of chemical preparations.
Dezhou Shihua Chemical Co. Ltd. manufactures and distributes chemical products. The Company produces polyvinyl chloride resins, liquid chlorine, hydrochloric acid, caustic soda, titanium dioxide, and other chemical products.
 
China Construction Bank Corporation provides banking services. The Company offers deposits, loans, fund management, foreign exchange, and other services. China Construction Bank provides its services to individuals, enterprises, and other clients.
Private Actor 1 Private Actor 1 Role Private Actor 1 Sector Relation Private Actor 2 Private Actor 2 Role Private Actor 2 Sector
China National Chemical Corp Ltd Client Industry and Trade owns Dezhou Shihua Chemical Co Ltd Subsidiary Industry and Trade
China National Chemical Corp Ltd Client Industry and Trade owns Haohua Yuhang Chemical Co Ltd Subsidiary Industry and Trade

Contact Information
This section aims to support the local communities and local CSO to get to know which stakeholders are involved in a project with their roles and responsibilities. If available, there may be a complaint office for the respective bank which operates independently to receive and determine violations in policy and practice. Independent Accountability Mechanisms receive and respond to complaints. Most Independent Accountability Mechanisms offer two functions for addressing complaints: dispute resolution and compliance review.

Project Officer: Liu, Xinjian
East Asia Department
No contact information provided at the time of disclosure

ACCOUNTABILITY MECHANISM OF ADB

The Accountability Mechanism is an independent complaint mechanism and fact-finding body for people who believe they are likely to be, or have been, adversely affected by an Asian Development Bank-financed project. If you submit a complaint to the Accountability Mechanism, they may investigate to assess whether the Asian Development Bank is following its own policies and procedures for preventing harm to people or the environment. You can learn more about the Accountability Mechanism and how to file a complaint at: http://www.adb.org/site/accountability-mechanism/main

How it works

How it works