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Star Hydropower
Environmental & Social Review Summary

This Environmental and Social Review Summary is prepared and distributed in advance of the IFC Board of Directors’ consideration of the proposed transaction. Its purpose is to enhance the transparency of IFC’s activities, and this document should not be construed as presuming the outcome of the Board of Director’s decision. Board dates are estimates only.
Any documentation which is attached to this Environmental and Social Review Summary has been prepared by the project sponsor and authorization has been given for public release. IFC has reviewed this documentation and considers that it is of adequate quality to be released to the public but does not endorse the content.
Project number 26229
RegionMiddle East and North Africa
SectorLarge Hydro - Renewable Energy Generation
Environmental category:A
Date ESRS disclosedJanuary 12, 2011
Last Updated DateAugust 15, 2011
Previous EventsInvested: December 31, 2012
Signed: December 13, 2011
Approved: September 8, 2011
View Summary of Proposed Investment (SPI), click here

OverviewCategory &

Applicable Standards
Key Issues

& Mitigation


of Full


Overview of IFC's scope of review
IFC’s review of its proposed investment in the Project included: a review of environmental and social assessments prepared for the project by Pakistan Engineering Services (Pvt.) Ltd. in May 2007, which were revised and expanded into an Environmental Impact Assessment and Resettlement Plan in June 2010 to address with the requirements of the Asian Development Bank (ADB), which will be one of the co-lenders to the Project; a review of further updated Environmental Impact Assessment dated November 2010 and supplemental studies on vegetation and fish fauna of November 2010; meetings with the Company’s own management and technical consultants to review the environmental and social documentation prepared for the Project; a site visit to inspect all proposed components of the Project and meet with representatives of communities who will be affected by the construction and operations of the Project; follow-up consultation with the ADB environmental and social staff and consultants regarding the impacts and mitigation strategies of Project management; and an inspection of the environmental, health and safety performance of one of the Project’s proposed principal construction contractors, which is constructing a smaller run-of-river project in the Mirpur area of Azad Jammu & Kashmir (AJK).
Project description
Star Hydro Power Limited (“SHPL” or the “Company”) is in the process of developing a 147 MW run-of-the-river greenfield hydroelectric power plant, on a Build Own Operate and Transfer (“BOOT”) basis, situated in part on the Kunhar river, which marks the border between Azad Jammu and Kashmir (“AJK”) and the Khyber Pakhtunkhwa province of Pakistan (“KP”) and in part on the Jhelum river in AJK” (the “Project”). AJK is the Pakistan-administered portion of an area over which India and Pakistan have been in dispute since 1947. By supporting the project, IFC does not intend to make any judgment on the legal or other status of any disputed territories or to prejudice the final determination of the parties' claims. The Project will divert a portion of the Kunhar River through a tunnel to a powerhouse located on the right bank of Jhelum River at the village of Alda opposite the Lower Chattar area of Muzaffarabad town. The Project main components consist of a diversion weir (42 m height) across Kunhar River, near Patrind village, a headpond formed by the weir extending approximately seven km upstream on the Kunhar River contained by a natural gorge, an intake structure with siltation chambers, a 2.2 km headrace tunnel, an underground penstock, a surge chamber, a power house and tailrace structure. Two temporary coffer dams and a diversion tunnel will be built on the Kunhar River to maintain dry conditions during the construction of the permanent diversion weir.

Electricity from the Project will be sold to National Transmission and Dispatch Company (“NTDC”), Pakistan’s state-owned company. NTDC will construct and operate a transmission line from the Project site to NTDC’s national grid. As of December 2010, options being considered by NTDC are either (i) 132 kV transmission line to Gahri Halibullah Grid Station (which is in the planning stage and the land is being acquired) which will be about 20 to 25 km from the Project site, or (ii) 132 kV or 220 kV transmission line to grid stations in Mansehra, with total transmission line distance of about 50 to 60 km.

The Jhelum River is classified as an International Waterway and together with its tributaries, including the Kunhar River, is subject to the Indus Waters Treaty of 1960. In accordance with IFC’s Policy on Social and Environmental Sustainability (April 30, 2006), IFC sent riparian notices to the IFC Executive Directors for both, India and Pakistan notifying them of IFC’s proposed investment in the Project and its location in AJK, the Pakistan-administered portion of an area over which India and Pakistan have been in dispute since 1947. By supporting the Project, IFC does not intend to make any judgment on the legal or other status of any disputed territories or to prejudice the final determination of the parties’ claims.

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