Jilin Urban Water Supply Analysis

Technical Assistance Consultant’s Report
Project Number: 46048-001

March 2014
People’s Republic of China: Jilin Urban Development

Project
FINAL REPORT
(Volume III of V)
Prepared by HJI Group Corporation

Costa Mesa, CA, USA.
For Jilin Provincial Government
This consultant’s report does not necessarily reflect the views of ADB or the Government concerned, and
ADB and the Government cannot be held liable for its contents. (For project preparatory technical
assistance: All the views expressed herein may not be incorporated into the proposed project’s design.
CURRENCY EQUIVALENTS
(As of 15 January 20141)
Currency Unit – yuan (CNY)

CNY 1.00 = $0.1667
$1.00 = CNY 6.000
ABBREVIATIONS
1
Due to the uncertainty of future change of the exchange rate, a fixed currency exchange rate is assumed and used
for the analysis of the project.
WEIGHTS AND MEASURES
NOTE
In this report, "$" refers to US dollars.

Jilin Urban Improvement Project Supplementary Appendix 4
(TA 8172-PRC) Final Report
Supplementary Appendix 4
Baishan Water Supply Analysis
1
Table of Contents
1. Introduction ........................................................................................................................................... 4
1.1 Overall Description ................................................................................................................ 4
1.2 Baishan City ........................................................................................................................... 4
1.3 Baicheng City......................................................................................................................... 4
2. Background ........................................................................................................................................... 4
2.1 Geography and Topography .................................................................................................. 4
2.1.1 Baicheng City ................................................................................................................. 4
2.2 Rivers and Water Systems .................................................................................................... 5
2.2.1 Rivers and Water Systems in Baishan Municipality ....................................................... 5
2.2.2 Rivers and Water System in Bacheng Municipality ....................................................... 5
2.3 Water Conservancy Engineering ........................................................................................... 6
2.3.1 Water Supply Engineering In Baishan City .................................................................... 6
2.4 Climate Condition .................................................................................................................. 6
2.4.1 Mean Annual Temperature ............................................................................................. 6
2.4.2 Precipitation in Jilin Province ......................................................................................... 7
2.4.3 The Variation Trend of Annual Precipitation and Annual Temperature .......................... 8
3. Water Resource Assessment in the Project Area ................................................................................. 9
3.1 Water Resource Amount Assessment in Baishan City .......................................................... 9
3.1.1 Total Water Resource Assessment ................................................................................ 9
3.1.2 The Available Water Resource Amount Assessment ..................................................... 9
3.1.3 Status of Construction of Xibeicha Reservoir ............................................................... 11
3.1.4 Water Quality Assessment ............................................................................................ 11
3.2 The Existing Water Consumption Assessment of Baishan City ........................................... 11
3.2.1 Overall Current Water Consumptions in Sector's Assessment ..................................... 11
3.2.2 Current Water Use Efficiency ....................................................................................... 12
3.2.3 The Changing Trend of water Consumption ................................................................ 13
3.3 Review the Current Water Supply Alternative Options in Baishan City ............................... 15
3.3.1 Review of the Current Situation of the Water Supply................................................... 15
3.3.2 Review of the Water Treatment Plant .......................................................................... 15
3.3.3 Identify Potential Weakness In Existing Infrastructure and Management ................... 15
3.3.4 Identify Potential Weakness in Operation and Maintenance, Service and Management
16
3.3.5 Assessment on the Current Tariff Level ....................................................................... 16
3.4 Water Resource Assessment in Baicheng .......................................................................... 17
3.4.1 Total Water Resource Assessment .............................................................................. 17
3.4.2 The Available Water Resource Amount Assessment ................................................... 17
3.5 The Existing Water Consumption Assessment Of Baicheng City ....................................... 17
3.5.1 Overall Current Water Consumption in Sector’s Assessment ..................................... 17
3.5.2 Current Water Use Efficiency Assessment in Main Sectors ........................................ 18
3.5.3 The Changing Trend of Water Consumption in Recent Years ..................................... 18
4. Water Demand Prediction and Water Balance Assessment Of Baishan City .................................... 19
4.1 The Determination of the Base Line Year and the Planning Level Year .............................. 19
4.2 Main Design Specifications, Norms, and Standards ........................................................... 19
4.3 Targets of Water Supply Plants ........................................................................................... 20
4.4 The Determination of Sector’s Water Usage Quota ............................................................ 20
4.5 Prediction of Social-Economic Development and Water Consumption Assessment of
Baishan City ........................................................................................................................................ 20
4.5.1 The Existing Social-Economic Assessment ................................................................. 20
4.5.2 Comprehensive Urban Domestic Water Use Quota .................................................... 21
4.5.3 Prediction of Society-Economy .................................................................................... 21
4.6 Water Demand Prediction of Baishan City .......................................................................... 21
4.6.1 Water Demand Prediction Of Baishan City Center ...................................................... 21
4.6.2 Water Demand Prediction Of Hunjinag District ............................................................ 22
4.7 Water Balance Assessment ................................................................................................. 24
5. Technical Assessment of Baishan Water Supply ................................................................................ 24
5.1 Introduction .......................................................................................................................... 24
5.2 Water Transmission Pipelines ............................................................................................. 25
5.2.1 Alternatives Study ........................................................................................................ 25
5.2.2 Engineering Design ...................................................................................................... 27
5.2.3 Main Construction Quantity .......................................................................................... 28
2
5.3 Water Treatment Plant ......................................................................................................... 29

5.3.1 Introduction .................................................................................................................. 29
5.3.2 Alternatives Study ........................................................................................................ 30
a) The Alternative of Water Purification Process .............................................................. 32
b) Primary Oxidant Chemical Alternatives ........................................................................ 33
c) Flocculator Alternatives ................................................................................................ 33
d) Sedimentation Tank Alternatives .................................................................................. 34
e) Filter Alternatives .......................................................................................................... 34
5.4 Water Distribution Pipeline .................................................................................................. 36
5.4.1 Engineering design ...................................................................................................... 36
6. Technical Assessment of Baicheng City ............................................................................................. 39
6.1 Introduction .......................................................................................................................... 39
6.2 Engineering Design ............................................................................................................. 39
7. Operation and Maintenance................................................................................................................ 40
7.1 Successful Experience in China and Abroad....................................................................... 40
7.1.1 Importance of Operation & Maintenance to Water Supply Systems............................ 40
7.1.2 Measures adopted on Energy Saving .......................................................................... 40
8. Conclusions and Recommendations .................................................................................................. 42
3
1. Introduction
1.1 Overall Description
1. The Jilin Provincial Government (JPG) and Baishan and Baicheng city governments, in consultation
with Asian Development Bank, have proposed the water supply project component for Baishan for Jilin
Urban Development Project (ADB-TA8172).
1.2 Baishan City
2. For Bashan City, the proposed construction project includes 2 components: (i) the water supply
system; (ii) the integrated municipal solid management. For the water supply system, the proposed project
component include: (i) the water transmission line to Hunjiang District; (ii) the water transmission line to
Jiangyuan District; (iii) the water treatment plant for Hunjiang, and (vi) the water distribution pipe network in
Hunjiang.
1.3 Baicheng City
3. In Baicheng City, the proposed project is at the south and west of the existing urban area, namely
Baicheng Economic Development Zone and New Urban Area, which are defined as the new residential
and commercial development areas. The proposed project components include: (i) roads and bridges; (ii)
water supply system; (iii) sewage networks and stormwater networks; (iv) power and communication
system; (v) primary heating pipe network, and (vi) associated urban facilities. .
2. Background
2.1 Geography and Topography
4. Jilin Province lies in the North-East part of China, it locates in the middle part of the North-East Plain .
There is a obvious difference in topography in the province, the topography is inclined from the south-east
to the north-west with obvious features of there is high elevation in the south-east part and low elevation in
the north-west part of the province.
5. Baicheng City and Baishan City are two of cities in Jilin Province. Baicheng City locates in the
North-West part of the province and in the Eastern Part of Horqin Grasslands and the Central Part of
Songnen Plain. Baishan City
6. Baishan Municipality locates in the hinder land of Changbai Mountain, most of the territory areas is
covered by the Changbai lava platform and the Jingyu lava platform. Mountain forests go through ups and
downs, gullies and rivers are crisscross. The Longgang Mountain Chain and The Laolong Mountain Chain
across the whole region. The elevation of Longgang Mountain Chain is about 800-1200m, the relative
elevation is about 500-700m; The body of Laolong Mountain Chain is broad with the elevation of
1000-1300m, and the relative elevation is about 500-800m. The topography along the Yalu River has large
range of rising and falling, with deep valley cutting, steep terrains.
7. Baishan City is located in the alluvial valley of the Hunjiang River with a narrow valley landform, there
are landform floodplains, terraces class-1 and terrace of class-2. The South Mountainous City, north to the
ground and floodplain. There is a great topographic changes in urban area with the elevation altitude of
460 ~ 580m.
8. The Geological strata Cenozoic quaternary is well developed, it is generally covered with loose
sediments. Underground water is abundant, the underground water level is generally about 0.7m under
the ground.
2.1.1 Baicheng City
9. Baicheng city is located in the north-west of Jilin Province, the western part of the Songnen Plain and
the eastern part of Horqin grassland. It borders with the Inner Mongolia Autonomous Region to the
Southwest and to the northwest; Baicheng City is separated by the Nen River opposite to Heilongjiang
province. So Baicheng City is a combination of the Inner Mongolia Autonmous Region, Provinces of
Jilin, Heilongjiang, the latitude is from 44 ° 13 '- 46 ° 18', the longitude is from 121 ° 38 '- 124 ° 23'.
4
10. The elevation of Baicheng City is lower in the central part of the city while it is relative higher around
the city. To the west, it is the Fold Belt of the east hillside of DaHinggan Mountains with low mountains, hills
terraces and valley beachs. In the central part of the city, it is a broad alluvial plain which it belongs to part
of the Songnen Plain, the broad valleys, terrace of level-1 and mass of lakes spreads here and there with
the elevation of 130-140m. In the east-south part of the city, it is a typical topography of alluvial fans,
proluvial fans with the elevation 220-285m.
11. There is a loess terrace in the middle part of the city, it is the watershed of Songhua River and The
Eastern Liao River. In the west-south part of the city, it is part of the Songliao Plain, and the alluvial plain
what is covered by sand dunes with the elevation of 180-210m, sand dunes, sand ridges spread here and
there. There are some pondings in low area and alkalization phenomenon.
2.2 Rivers and Water Systems
2.2.1 Rivers and Water Systems in Baishan Municipality
12. In Baishan City, there are many rivers and water systems and intensive of gully's and river's network.
The Yalu River, the second Songhua River are two of major river systems, then it forms 4 of watersheds of
the Yalu River, the Hunjiang River, the First Songhua River And its tributaries.
13. There are 2 of water systems in Baishan Municipality, they are The Yalu River water system and the
Second Songhua River water system. The Hun River is the biggest rivers among 55 of main rivers, the
3
normal runoff flow rate is about 6～7m /s .
2
14. The catchment area of Hun River is 1688.2km . Main tributaries with greater than or equal to
2
50km are the southwest Chahe River, the main Chahe River, the Dayang River, the Lichagou River etc.
2
The main tributary of the First Songhua River water system is the Tanghe River with 471.5km of
2
catchment area . One of main tributaries of the Yalu River is the Sandao River with 196km of catchment
area.
2.2.2 Rivers and Water System in Bacheng Municipality
15. There are 8 main rivers across into the Baicheng Municipality, they are the Nen River, the Taoer River,
The Huolin River, the Erlongtao River, the Jiaolong River, the Huer-da River, the Wenniugechi River and
the Ermute River. The mean annual runoff of the NenRiver, the Taoer River the Jiaolong River and the
3 3 3 3
Huolin River is 22,000 million m , 1347 million m , 233.4million m and 75.2 million m respectively.
16. The Nen River is original in the Hule Mountain area on the south hillside of the Da hinggan Mountains,
2
the total length of the river is 1370km with 29.7 km of the catchment, the mean annual runoff amount is
3
1786 million m .
17. The Yao'er River is one of bigger tributary on the down-stream of the right bank of the Nen River what
generates in the south hillside of the Da Hinggan Mountains. It enters into Bacheng city at Lingxi Town of
the city, and it crosses Yaonan city, Da'an City and Zhen cities and counties, then flow into Yueliang -pao
Reservoir, at last it enters into the Nen Rvier from Ha-er-jin Gate. The total length of the river is 235km with
2 3
12557km of catchment. The mean annual runoff flow rate is 1701 million m at the south Yao'er
hydrological station. According to the Water Basin Plain, the assigned water amount to Jilin Province is
3
450 million m .
18. The Hulin River is one of another tributary in the province where in the down-stream, on the right bank
of the Nen River which generate in the north hillside of Dahinggan Mountains. The total length of the river
2 3
is 815km with 37655km of catchment area. The mean annual runoff volume is about 172 million m , and it
often occurs in the form of flood. There is no water flow into Jilin Province except in flood season, the
Huolin River has dried up in the year around.
5
2.3 Water Conservancy Engineering
2.3.1 Water Supply Engineering In Baishan City
19. In Baishan City there is currently only 1 medium-sized reservoir, it is Qujiaying reservoir; 4 small
3
(A)-sized reservoirs, 5 small (B)-sized reservoirs. The total reservoir's storage capacity is 3.479 billion m ,
3
the total utilizable capacity is 2.453 billion m . Among which, the total storage capacity of the Qujiaying
3
Reservoir is 2.690 billion m , it was accounting for a total storage capacity of 77.3%; the utilizable capacity
3
of the reservoir is 2.030 billion m , it accounts for 82.8% of the total utilizable capacity in Baishan City .
20. The Qujiaying reservoir is the major water source of the water supply system for Baishan City. The
summary of the river systems in Baishan City is shown in Table 2-1:
Table 2-1: The Situation of Water Conservancy Engineerings of Baishan City
Utilizable
Storage
Administrative Locations of Catchment capacity Completion
Reservoirs capacity Size Functions
Districts Rivers area(km2) (million date
(million m3)
m3)
Urban water
supply
Medium-
Qujiaying Hongtuya River 263.4 26.9 20.3 2003.12 Hydropower
sized
generation, fishing,
flood control
Langdonggou Langdong River 2.5 0.185 0.16 1978 Small B Fishing, irrigation
Hunjian Guotiepiangou
Shengli 3.8 0.112 0.077 1979 Small B Fishing, irrigation
District River
Urban water
supply,
Hekou Hongtuya River 600 1.475 0.6 1983.5 Small A
hydro-power
generation
Qinggouzi Qinggou River 10 1.68 1.26 1972.1 Small A Tourism fishing
Taipinghu HeigouRiver 84.3 1.145 0.686 Small A Fishing, irrigation

Urban water
Xichuan Tang River 9.5 2 0.66 1977.1 Small A
supply, irrigation
Jiangyuan Yue-jin Xibeicha River 1 0.115 0.042 1972.11 Small B Irrigation

District
Heisong Heisong River 6.3 0.661 0.375 1977.1 Small B Water supply
Wanlin Tang River 12.27 0.516 0.368 2001 Small B Water supply
Total 34.789 24.528
2.4 Climate Condition
2.4.1 Mean Annual Temperature
21. Baishan City The mean annual temperature is 4.6℃, the highest temperature is 36.5℃ in summers
and the lowest temperature is -42.2℃ in winter based on the historical climate recording. The mean annual
precipitation is 883.4 mm. The sunshine time is 2259 hours, and the frost free time is 140 days.
o
22. Baicheng City The mean annual temperature is 4.6℃, the coldest temperature is -40.2 C in winter
and the average frost free time is about 134 days. The mean annual precipitation is 429.8mm with uneven
distribution. There are few precipitations in spring and winter, but more in the summer months from June to
September. Baishan is located in the temperate continental monsoon climate zone with climate features of
arid and windy in spring, warm and rainy in summer, cool in winter. There is abundant solar resource and
the mean annual sunshine hours are about 2890 hours.
6
2.4.2 Precipitation in Jilin Province
23. The mean annual precipitation in the province is 621.7 mm which it is higher than the average
1
national annual precipitation (648 mm) . The distribution of precipitation in PRC is shown in Figure 2 -1.
Figure 2-1: The distribution of mean annual precipitation in China (unit: mm)
24. The Distribution Situation of Precipitation in Space-Time The distribution situation of precipitation
in space-time is uneven in the province. The proportion of seasonal precipitation is 16%, 64%, 17%, and 3%
2
of annual precipitation respectively during the period of 1970-2000 . The highest monthly precipitation
usually occurs in July while the lowest monthly precipitation usually occurs in January. Considering the
distribution situation of annual precipitation in space, the region where is close to ChangBai Mountain has
the distinct rainy zone with the mean annual precipitation above 700mm. While in Baicheng City in the
west part of the province, the mean annual precipitation is less than 400mm. The distribution situation of
precipitation in Space-Time during the period of 1970-2000 in Jilin Province shows in Figure 2-2 and
Figure 2-3, respectively:
Figure2- 2: The Distribution Situation of Precipitation in Space-Time during the period of 1970-2000
80.0
60.0
Proporation (%)
40.0
20.0
0.0
Spring Summer Autumn Winter
Season season Season Season
Seasons
_
1. The Outline of The Urban Master Plan of Baicheng Municipality.

2. Planning and Design Institute of Jilin Urban and Rural by The Illustration of The Bacheng City Master Plan. 2008.
7
Figure 2-3: The Distribution Situation of Precipitation in Space during 1970-2000
2.4.3 The Variation Trend of Annual Precipitation and Annual Temperature
25. The global warming has obvious impact on the climate in the province. The annual temperature is
increasing with time during the period of 1961-2010. During 1961-1980 period, there were 3 years the
annual temperature is higher than the mean annual temperature of 1971-2010, while during the period
1981-2010, there are 3 years when the annual temperature is lower than the mean annual temperature
(Figure 2-4).
26. For the annual precipitation, the amplitude between drought years and wet years is becoming larger
in recent years, and the frequency of extreme drought and extreme wet has been increasing gradually as
shown in Figure 2-5.
Figure 2- 4: Annual mean temperature in Jilin Province during 1961-2010
8
Figure 2-5: Annual mean precipitation in Jilin Province during 1961-2010.
3. Water Resource Assessment in the Project Area
A. Baishan City
3.1 Water Resource Amount Assessment in Baishan City
3.1.1 Total Water Resource Assessment

3
27. The mean annual water resource amount in Baishan Municipality is 8025 million m , and the mean
3
annual groundwater resource amount is 1474 million m which accounted for 18.36% of total water
3
resource. The water resource amount per capita is 6034 m which is higher than the average water
resource amount per capita in the province as it is 2.4 times and 4.1 times of the national and provincial
average levels.
28. For Baishan urban area, according to The Water Resource Planning of Baishan City, the mean annual
3
water resource amount of Baishan City is 1,155 million m , and the mean annual available water resource
3
amount is 405 million m . For Hunjiang District, the mean annual water resource amount and the mean
3 3
annual available water resource amount are 582 million m and 175 million m , respectively. The details of
water resources are shown in Table 3-1.
Table 3-1: The Situation of Water Resource In Baishan City
3
Unit: million m
Total
Surface Available Available
Groundwater Total available
Administrative Catchment water surface groundwater
2 resource water water
regions area (km ) resource water resource
amount resource resource
amount amount amount
amount
Hunjiang
District 1373 582 175 131.16 21.23 582 175
Jiangyuan
District 1348 573 230 121.71 15.06 573 230
Total 2721 1155 405 252.87 36.29 1155 405
3.1.2 The Available Water Resource Amount Assessment
29. At present, there are 4 of water sources as the urban water supply sources: Qujiaying reservoir,
9
Zhenzhumen underground springs, Kucanggou underground water source, and Jinying underground
3 3
water source. The water supply amounts from Zhenzhumen, Kucanggou, Jinying are 9000m /d, 5000 m /d,
3
10,000m /d, respectively.
30. The Zhenzhumen water source is not used at the present because it is has been polluted by the
discharge from gold mining. The Jinying is not used because the actual water yield is far lower than the
designed water supply capacity; especially there is a sharp drop during the winter season. Kucangou
water source has a steady flow year round, but the water treatment facility is outdated and he water
production amount is too small. It is not rational to use it as the urban water supply source.
31. The available water resource for water supply plant in Baishan City is from Qiujiaying reservoir. The
3 3
mean annual available water supply quantity is 100,000m /d, of which 80,000m /d is allocated for the
water supply. However, since the water source for Qujiaying reservoir is from the surface water, it varies
from year to year and not really stable for water supply use.
32. The water source for the proposed water supply system in Baishan City is Xibeicha Reservoir which is
under construction. The Xibeicha Water Conservancy Hub Project is located in Jiangyuan District of
Baishan City. The project is to build the Xibeicha Reservoir. The main functions of the reservoir are water
3
supply, hydrological power generation and flood control. The total storage capacity is 12.37 million m . The
3
power generation capacity is 3250 KW and the daily water supply capacity is 80,000 m /d.
33. Xibeicha Reservoir is the proposed water source for the project. The Xibeicha River, a tributary of Hun
2
River, has the catchment area of 128km . The length of the river is 19.25km and the average slope is
about 1.5%. The river system of Hun River is shown in Figure 3-1.
Figure 3-1: Hun River Water System
10
3.1.3 Status of Construction of Xibeicha Reservoir
34. The cost for the reservoir is from State and Provincial Governments. For the construction of small
hydropower projects, 3 billion CNY from the State fund was in place in November 2011 and another 3
billion CNY was in place in September 2012. From the provincial government, a 2 billion CNY of the
provincial funds was in place for the construction in October 2012. The cost of the construction of the
reservoir will be covered by the state and provincial government funding.
35. At the present, the totaled completed investment had reached CNY 107.28 million, which is about 7%
of total investment (by June 2013). According to the statement from the Water Affairs Bureau of Baishan
City, the dam construction will be completed in 2014, and the power plant will be also be completed by the
3
end of 2014. It is planning to start storing water by end of 2015 .
3.1.4 Water Quality Assessment
36. The catchment of the Xibeicha River is in the mountains area The area is covered with a good
vegetation and the forest coverage rate has reached more than 95%. Across the catchment of the
upper-stream of the Xibeicha Reservoir, there is no village, no mining, and no cultivated land. There is
pollution for the water source. A survey for water quality of Xibeicha River was completed by The
Monitoring Station of EPB, Baishan Municipality during 2008-2013. Some of the main test results include:
PH=7.23, BOD=1.30 mg/L, COD MN 1.67 mg/L, which are all meeting drinking water standards.
3.2 The Existing Water Consumption Assessment of Baishan City
3.2.1 Overall Current Water Consumptions in Sector's Assessment

3
37. In 2011, the total water usage amount was 183.29 million m of them the water usage amount in
3
urban water usage was 174.59 million m . It accounted for 95% of total water usage amount according to
The Bulletin of Water Resource Management of Baishan Municipality.
38. The water usage amount of Hunjiang District was accounted for about 86% of total water usage in the
Baishan City by 2011. Details of water usages by sectors and by administrative regions of Baishan City are
shown in Table 3-2 below:
Table 3-2: The Situation of Water Consumption of Baishan City by 2011.
Rural water usage 10 000 m3 Urabn water usage 10 000 m3 Among which:
Administrative Total
Forestry and Groundwater
Region Agricultural Urban Industrial Public (10,000 m3)
animal Sub-total Enviornment Sub-total (10,000 m3)
irrigation domestic production facility
husbandary
Hunjiang District 481 68 549 2,055 12,502 507 120 15,184 15,733 796
Jiangyuan District 108 213 321 574 1,422 173 106 2,275 2,596 569
Total 589 281 870 2,629 13,924 680 226 17,459 18,329 1,365
Proportions in total
3.2% 1.5% 14.3% 76.0% 3.7% 1.2% 7%
water usage (%)
39. Among main water use sectors, the water usage in agricultural irrigation, forestry and animal
husbandry, urban domestic, industrial, public facility and environment was 3.2%, 1.5%, 14.3%, 76.0%, 3.7%
and 1.2% respectively by 2011.
40. In 2011, the proportion of water usage in urban domestic, industrial production and public facility was
58%, 27% and 15%. Details are shown in Figure 3- 2.
3
. The data source was provided by Baishan Water Affairs Bureau in November,2013.
11
Figure 3-2: Proportions of Sector's Water Usage by 2011 in Baishan City
15%
58%
27%
Urban domestic Industry Public facility
3.2.2 Current Water Use Efficiency
41. Urban Domestic Water Consumption: In Hunjiang District, the urban domestic water consumption
3 3
has increased from 7.06 million m by 2001 to 8.90 million m by 2011. The gross urban domestic water
consumption quota had increased from 123 l/pd by 2001 to 167 l/pd by 2011. Considering the NRW loss,
the net urban domestic water consumption quota had increased from 89 l/pd by 2002 to 110 l/pd by 2011.
42. Urban Domestic Water Consumption Quota of Baishan City: According to The Bulletin of Water
3
Resource in Baishan Municipality of 2011, the total water usage amount in domestic was 2.629 billion m ,
the gross resident's domestic water usage quota, the net resident's domestic water usage quota was 121
l/pd and 79 l/pd.
43. Industrial-added value water usage quota: The main industries in Baishan City are Hydro-power
3
generation, medicine production and tourism. By 2011, the industrial added-value was 37,89 million m ,
3
and the water consumption of per 10,000 CNY of industrial added-value was about 90 m /10,000 CNY.
44. A survey on the situation of water supply by enterprises’ spare water source that was conducted by
Baishan Water Supply Group in 2013. It shows that within Hunjiang District, most of water users of
agencies use their own water sources, there were a total of 188 water users of agencies, among which
157 users are using groundwater and 31 of the users are using surface water in 2012. Water users what
have own water sources include the hydropower plant, stone plant and mineral water production. The total
3
annual water consumption is estimated as 66,46 million m by spare water source.
3
45. By 2011, the total water usage amount in industrial-added value was 139.24 million m , while the
3
industrial-added value was 14,414 million CNY. The quota of industrial-added value was 90 m per 10,000
CNY in Baishan City. But there was a great unbalance between Hunjiang District and Jiangyuan District.
The water usage quota of industrial added-value in Hungjiang was about twice of it in Baishan City. The
details are shown in Table 3-3.
Table 3-3 : The Situation Of Sector's Water Usage Of Baishan City By 2011
Industrial water
usage amount Domestic Net domestic Industrial-added
Domestic water Among which: Industrial-added
Administrative (10,000 m3) Population water usage water value Water
usage amount Groundwater value
Region 10 000 quota usage quota usage quoa
(10,000 m3) (10,000 m3) (10,000CNY)
Of which: l/p.d) lp.d) 3
Total (m /10,000 CNY)
groundwater
Hunjiang District 2,055 796 12,502 27 697,742 34.9 161 105 179
Jiangyuan District 574 569 1,422 296 743,627 24.44 64 42 19
Total 2,629 1,365 13,924 323 1,441,369 59.34 121 79 97
12
3.2.3 The Changing Trend of water Consumption

3
64. The total of water supply amount in Baishan City has been increased from 1.394 billion m by 2001 to
3
1.539 billion m by 2011, with a 2.36% of annual increasing rate of water supply amount. The rate of
Non-revenue water (NRW) has increased from 45% in 2001 to 66% by 2011 due to lack of essential
maintenance and upgrading.
65. The Nanshan Water supply is the largest water supply plant in the city. The details of water
consuption are shown in Table3-4 and Figure 3-3, and the water usage of water supply in Hunjiang
District shows in Table 3-5.
Table 3-4: The Situation of Water Consumption by Sectors in Baishan City By 2011
Water supply /consumption amount Years

water supply plants
10,000m3)
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Water Supply Amount 182.5 182 170.4 127.75 180.1 130.11 129.11 177.41 141.32 18.12 18.05 18.25
Cangnangou
Saled Water Amount 100.92 78.98 64.4 62.03 77.81 53.33 49.22 61.39 47.93 8.95 7.3 6.27
Water Supply Amount 348.8 547.78 715.32 580 531.93 555.44 581.17 708.7 907.99 960.46 1271.92 1433.84
Nanshan
Water Supply Amount 313.29 304.2 287.54 182.3 214.83 201.15 204.55 212.4 181.25
Jinying
Saled Water Amount 173.24 131.98 108.7 88.52 92.8 82.45 77.98 73.5 61.48
Water Supply Amount 365 360 289.5 229.95 237.44 210.3 240.17 222.03 211.2 81.56 78.26 87.32
Zhenzhumen
Water Supply Amount 1209.59 1393.98 1462.76 1120 1164.3 1097 1155 1320.54 1441.76 1060.14 1368.23 1539.41
Total
Consumped Water Amount 668.86 616.48 552.93 543.8 502.97 449.61 440.31 456.94 488.97 523.15 554.14 528.45
NRW (%) 45% 56% 62% 51% 57% 59% 62% 65% 66% 51% 59% 66%
Proportion of water supply (%) 29% 39% 49% 52% 46% 51% 50% 54% 63% 91% 93% 93%
Nanshan WSP
Proportion of water consumption %) 29% 40% 49% 52% 46% 51% 50% 54% 63% 91% 93% 93%
Figure 3-3 : Annual Water Supply by WSPs in Baishan City During 2001-2011
Total water Suppy Cang-nan-gou Nanshan Jinying Zhenzhumen
1600
1400
Water amount (10,000 m3)
1200
1000
800
600
400
200
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Years
13
Table 3-5: Situations of Water Usage in Hunjiang District During 2001-2011
Annual water supply amount (10,000 proportions in total Water

Annual water usage amount (10,000m3) Annual water Comprhensiv Comprhensive
m)3 Comprehensiv usae amount (%) Urban Annual
fee e water urban domestic NRW rate
Years e water charge Populatio Increasing
(10,000 usage per water usage per (%)
Urban Public Total water NRW by Total water (CNY/m3) Urban Public n (10,000) rate
Industry Sub-Total CNY) Industry capita (l/p.d) capita (l/p.d)
domestic Facility usage WSP supply domestic facility
2001 705.88 504.88 210.22 1420.98 616.48 804.50 1420.98 1202.14 0.85 50% 36% 15% 20.47 190 123
2002 811.42 388.38 262.96 1462.76 552.93 909.83 1462.76 1401.84 0.96 55% 27% 18% 20.50 195 144 2.94 62%
2003 576.38 318.15 225.56 1120.09 543.80 576.29 1120.09 1395.59 1.25 51% 28% 20% 20.37 151 108 -23.43 51%
2004 680.71 325.19 260.52 1266.42 564.81 701.61 1266.42 1415.29 1.12 54% 26% 21% 20.21 172 128 13.06 55%
2005 621.93 338.44 136.63 1097.00 449.61 647.39 1097.00 1180.89 1.08 57% 31% 12% 19.64 153 106 -13.38 59%
2006 558.44 428.68 167.88 1155.00 440.31 714.69 1155.00 1310.77 1.13 48% 37% 15% 19.46 163 102 5.29 62%
2007 895.89 341.02 83.63 1320.54 456.94 863.60 1320.54 1362.54 1.03 68% 26% 6% 19.33 187 139 14.33 65%
2008 651.27 612.96 176.76 1440.99 488.98 952.01 1440.99 1449.63 1.01 45% 43% 12% 19.12 206 119 9.12 66%
2009 444.54 433.22 182.38 1060.14 523.15 536.99 1060.14 1493.59 1.41 42% 41% 17% 18.92 154 91 -26.43 51%
2010 787.03 358.98 222.22 1368.23 554.14 814.09 1368.23 1544.60 1.13 58% 26% 16% 18.82 199 147 29.06 59%
2011 889.62 412.17 237.62 1539.41 528.45 1010.96 1539.41 1561.06 1.01 58% 27% 15% 18.50 228 167 12.51 66%
14
3.3 Review the Current Water Supply Alternative Options in Baishan City
3.3.1 Review of the Current Situation of the Water Supply
66. By 2011, there were total 5 water supply plants/sources in Baishan City including 4 WSPs in Hunjiang
District and 1 WSP in Jiangyuan District.
67. WSPs in Hunjiang District. In Hunjiang District, there are 4 WSPs including Qujiaying, Zhenzhumen,
Kucanggou and Jinying. Zhenzhumen and Jianying WSPs have stopped supplying water due to pollution
from water sources. Kucanggou WSP has a steady water yield but the water treatment plant is too simple
and the treated water quality cannot meet the Standard Of Drinking Water (GB2006).
68. WSPs in Jiangyuan District. There is one water supply plant in Jiangyuan District, namely
Jiangyuan Water Supply Plant. The plant is located in the Dayangcha River. The water supply distribution
network has been upgraded in recently years.
69. The summary of water supply plants in Baishan City is shown in Table 3-6
Table 3-6 The Situation WSPs Of Baishan City BY 2011
Existing
Type water Water supply
Administrative
Water sources water supply service Current situation
Region
sources capacity objectives
3
( m /d)
Surface Resident's
Qujiaying 80,000 Run in normal
water domestic
Stopped supplying
Ground Resident's
Zhenzhumen 9,000 water due to water
water domestic
pollution
Water yield is steady
Spring Resident's but with a simple
Hunjiang Kucanggou 5,000
water domestic water treatment
District
plant
Stopped supplying
Spring Resident's water due to the
Jingying 10,000
water domestic water yield has
dropped
Sub-total 104,000
Water pollution, with
Yiangyuan Taiyangcha Surface Resident's
30,000 a low guarantee
District River water domestic
rate of water supply
3.3.2 Review of the Water Treatment Plant
70. General Situations. The Nanshan Water Treatment Plant is the only water treatment plant in
3
Hunjiang District. The water supply capacity of Nanshan Water treatment Plant is 80,000 m /d. The
Qujiaying reservoir is the water source of the water treatment plant. The raw water was transmitted 7.2 km
in tunnels and then through 1.0 km of water transmission pipelines to the water treatment plant. The plant
3
was built and put into production in 1992, and the operation processing capacity of water was 50000 m /d.
3
71. Water Treatment Technique. The actual water supply capacity is far below 50,000 m /d due to the
aged facilities and lack of maintenance. The conventional water treatment technology was used, which
includes mechanical mixing, grid flocculation, inclined tube sedimentation and siphon filter. Later an
3
additional 30,000 m /d water treatment capacity was added to the plant. A similar water treatment
technology including mechanical mixing, folded-plate reaction, inclined-plate sedimentation and fast
filtration was adopted. The current plant site is fully occupied without any spare space for further
expansion.
3.3.3 Identify Potential Weakness In Existing Infrastructure and Management
72. By 2011, there was a total length of 150 kilometers of water supply pipe (DN75 mm) network in
Hunjiang. The water distribution pipe size is too small and the guarantee rate for water supply is very low.
In the north side of Hujiang River and the the south side of the railroad line, the water supply network has
15
not fully developed yet.

73. The Qujiaying water source has been in use since 1992 and there has been no new water source
since then. The diameter of the water distribution network is too small than the required diameter. Major
problems of water supply in Baishan City are as follow:
(i) In recent years, the groundwater resource has been polluted and it cannot be drunk directly if it is
not treated by special water purification process. The water source of Qujiaying Reservoir is the sole
surface source. The treated water quality often cannot meet the standard of drinking water.
(ii) There is a gap between water demand and water supply. With the fast development of society and
economy in the city, not only the existing water supply capacity of Qujiaying reservoir cannot meet the
requirement of water demand, but also there is serious leakage problem in the water transmission
tunnel.
(iii) The water supply from Nanshan Water Treatment Plant (WTP) cannot meet the current demand.
3
The plant design treatment capacity is 80,000 m /d. However, the actual output is far less than the
design capacity and the water source is not reliable due to the water is taken from the surface water
from river.
(iv) There is a serious situation of pipe corrosion in the Distribution Network and the size of the
distribution network is much smaller than the required.
(v) The total water supply capacity will be in deficiency in future. According to the available water
3
demand predication outcome, the expected water demand will be 130,000m /d in 2020, the deficiency
3
of required treated water will be about 50,000 m /d. The existing water supply capacity cannot meet
the requirement of urban development.
(vi) There is high none revenue water (NRW) loss in Baishan, which is about 65% based on 2013 data.
3.3.4 Identify Potential Weakness in Operation and Maintenance, Service and Management
74. From the field survey and discussion, the potential weakness in operation, maintenance, service and
management in Baishan WSP are:
(i) Lack of necessary facilities for leakage detection and emergency rescue;
(ii) The staffs have poor skills on the management of WSP system.
(iii) High NRW in the water supply system.
(iv) The water quality monitoring still relies on traditional monitoring method by collecting water
samples manually without automatic monitoring and checking system.
3.3.5 Assessment on the Current Tariff Level
75. The current water tariff was issued by 2004 and it has not been modified or revised yet. The water
3 3 3
tariffs of urban domestic, industrial production, public utilities are 2.3 m /CNY, 4.0 m /CNY, 4.0 m /CNY
3
respectively. For special sectors, e.g. car washing, bath industry, the water tariff was 7.0 m / CNY. Details
are shown in Table 3- 7:
Table 3-7: The Situation Of Sector's Water Tariff of Baishan in 2004
Urban Industrial Special

Public utilities
domestic production sectors
2.30 4.00 4.00 7.00
16
B. Baicheng City
3.4 Water Resource Assessment in Baicheng
3.4.1 Total Water Resource Assessment
76. The water resource in Bacheng Prefecture is relative abundant, there are vast bodies of water. Rivers
2
and lakes spread all over the place. The total water area has reached 270,000 hm which is accounted for
2
42.2% of water area in the province. The total water surface area is 170,667hm which is accounted for 57%
of water surface area in the province.
3
77. The mean annual total water resource amount in the prefecture is 2,272 million m /a, among which,
3
the ground water resource is 2083 million m /a, accounted for 91.68% of total water resource amount. The
3
surface water is 189 million m /a, accounted for 8.32% of total water resource amount. The exploitable
3
groundwater resource amount is 1539 million m /a, it accounts for 73.88% of total ground water resource
3 4
amount. The mean annual crossing water amount is 22,000 million m /a.
3.4.2 The Available Water Resource Amount Assessment
78. In Baicheng City, the groundwater resource is the sole water source of the urban water supply system.
There are 3 water treatment plants. The No.1 water treatment plant stopped supplying water to residents.
2
There are 3 deep wells in the No.2 water treatment plant with the area of 113km , the average daily water
3
supply capacity is 15,000 m /d. There are 7 deep wells in the No.3 water treatment plant with the area of
2 3
31,162m , the average daily water supply capacity is 80,000 m /d. The total water supply amount is 22.46
3
million m /a. The No.2 water treatment plant is used as the spare source at peak times, while the No. 3
water treatment is the water supply source for the city all day round.
79. Regarding to the increasing in population and the increasing of water demand with the development
of society and economy in future, the surface water delivered by The Engineering of Transmission
Water From the Nen River to Baicheng Municipality will be used for the water source for the urban
water supply from 2015. The water supply capacity of the spare water source by enterprises was
3
25,000m /a.
80. The design capacity of The Program of Transmission of Nen River Into Baicheng Municipality is 394
3 3
million m /a, of which the water allocation to Baicheng City is 89.93 million m / by Jilin Water Resource
Department. Details are shown in Table 3-8.
Table 3-8： The Situation Of Water Resource In Baicheng City
Available resource (million m3) The supplied water amount (million m3)
Remain available
The allocation of The
The exploitable The supplied water water amount
Local ground Delivery Water From The supplied
ground water
the Nen River to
Total by Spare water Sub-total (million m3)
water amount water by WSP
amount source
Baicheng (million m3)
473200.00 402200.00 89.33 402289.33 21.18 11.38 32.56 402256.77
3.5 The Existing Water Consumption Assessment Of Baicheng City
3.5.1 Overall Current Water Consumption in Sector’s Assessment

3
81. The total water supply amount in Baicheng City has been increased from 3,03 billion m by 2001 to
3
3.49 billion m by 2011 with 13 % of annual increasing rate. The proportion of annual water supply by
WSPs in total water supply has increased from 34% by 2001 to 49% by 2006 and 61% by 2011.
3 3
82. While the total water consumption has been increased from 3.03 billion m by 2001 to 4.32 billion m
4. The Water Resource Management Statistic Yearbook of Baicheng City, 2012.

17
by 2006 with about 7% of average annual average increase rate.

83. The proportion of industrial water consumption has decreased from 53% by 2001 to 39% by 2006,
and the proportion of industrial water consumption has increased from 39% by 2006 to 41% by 2011
although the industrial added-value of 2011 was 5.4 times of it by 2001. While the proportion of water
consumption in public facility keeps steady during the same period. Details shows in Figure 3-4.
Figure 3-4 The Situation of Sector’s Water Usage in Baicheng During 2001-2011 Period.
Urban domestic water Industry

Public facility 线性 (Urban domestic water)
线性 (Industry)
70%
Proportion in total water sUsage (%)
60%
50%
40%
30%
20%
10%
0%
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Years
3
84. By 2011, the total water supply amount was 21,18 million m through WSP of Baicheng City; there
3
was an addition 11.38 million m of water supplied by the spare water sources of enterprises and privates.
3
The total water supply 32.56 million m . The supply rate of WSP was 65%.
3.5.2 Current Water Use Efficiency Assessment in Main Sectors
85. Generally speaking, the comprehensive urban domestic water usage keeps stable during the period
of 2006-2011 in Baicheng City. It has decreased from 267 l/p.d by 2001 to 233 l/l by 2011, the
comprehensive urban domestic water usage had decreased from 107 l/pd by 2001 to 94 l/pd by 2011 in
Baicheng city with the implementation of the WSPS upgrading. It was far below to the average provincial
level, and national level.
3
86. For water consumption in industrial, the water consumption quota has decreased from 445 m by
3
2001 to 38 m per 10,000 industrial added-value.
3.5.3 The Changing Trend of Water Consumption in Recent Years

3
87. From 2001—2011, the total water consumption amount has increased from 2.01 billion m in 2007 to
3
2.36 billion m in 2011 with about 3% of average annual rate. The details are shown Table 3-9.
3
88. By 2011, the total water consumption amount in Baicheng City was 32.56 million m , among which,
3
21.58 million m of water was supplied through WSPs, and the remains water was supplied by spare water
sources. The proportion of water supply through WSPs was accounted for about 65% of total water supply.
89. Among sector's water usage, the proportion of urban domestic water, industrial water, public facilities
was 41%, 38% and 19% respectively. Details are shown in Figure 3-5.
90. From the Table 3-9 below: The proporation of water supply through WSP had increase from 34% by
2001 to 61% by 2011. As a result, the public water supply engineering has made an important contribution
to the society and economy development.
Table 3-9: The Changing Trend of Water Usage in Baicheng City During 2001-2011
18
proportions in total Water usage

Annual water usage amount (10,000m3) Annual water supply amount (10,000m3) Water supply by WSP
amount (%)
Years Total NRW Water

Urban Public Proportio Urban Public
water supply
Industry domestic Facility Others Total Free Total n of WSP Industry domesti Facility Others
usag amount
water water chargable Leakage sub-total ( %) c water water
amount (10,000m3)
water
2001 1,599 1,129 302 3,030 3,030 3,030 1,026 34% 53% 37% 10%
2002 1,826 1,559 308 3,693 3,693 3,693 1,863 50% 49% 42% 8%
2003 2,012 1,271 635 315 4,233 4,233 147 147 4,380 2,324 53% 48% 30% 15% 7%
2004 1,981 1,349 636 324 4,290 4,290 153 153 4,443 2,246 51% 46% 31% 15% 8%
2005 1,679 1,350 638 623 4,290 4,290 252 252 4,542 2,274 50% 39% 31% 15% 15%
2006 1,679 1,368 648 623 4,318 4,318 342 342 4,660 2,274 49% 39% 32% 15% 14%
2007 543 1,218 292 48 2,101 2,101 327 1,467 1,794 3,895 2,397 62% 26% 58% 14% 2%
2008 753 1,495 485 76 2,809 2,809 557 652 1,209 4,018 1,199 30% 27% 53% 17% 3%
2009 701 1,541 509 69 2,820 2,820 557 623 1,180 4,000 2,363 59% 25% 55% 18% 2%
2010 573 1,274 439 65 2,351 2,351 528 622 1,150 3,501 2,349 67% 24% 54% 19% 3%
2011 957 897 441 65 2,360 2,360 519 608 1,127 3,487 2,118 61% 41% 38% 19% 3%
Figure 3-5 : The Situation of Water Usage in Baicheng by 2011
4. Water Demand Prediction and Water Balance Assessment Of Baishan City
4.1 The Determination of the Base Line Year and the Planning Level Year
91. Considering the available data for society-economy, water supply and water usage in proposed
project area, it is decided that the year of 2011 was the base line year. Based on Urban Water Supply
Engineering (GB50282-98), and the available planning achievements for Urban Master Planning, Five
Years Planning in social-economic development and the Long-term planning of water resource, and the
planning urban water supply, it is suggested that the year of 2020 is the design year, and the year of 2025,
2030 is the final planning years.
4.2 Main Design Specifications, Norms, and Standards
• "The Standard for Design of Outdoor Water" (GB50013-2006)

• "The Standard of City Water Supply Engineering Planning" (GB50282-98)
• "The Standard for Drinking Water” (GB5749-2006)
19
4.3 Targets of Water Supply Plants
92. The design guarantee rates of the proposed project was determined by relative national design
specifications for domestic water use sector, industry consumption sector and agricultural irrigation water
use sector. The coverage rate of urban domestic is no less than 95% and 98% by 2020 and 2030
respectively. The leakage rate of WSP will be decreased to 30%, 20% respectively. The objective of water
supply service is urban domestic, industrial production and environmental use for landscaping and road
cleaning.
4.4 The Determination of Sector’s Water Usage Quota
a) Comprehensive Urban Domestic Water Usage Quota

93. National Comprehensive Urban Domestic Water Quota - In order to predict the water demand for
urban domestic use, The Specification of City Water Supply Project Planning GB50282-98 is
refereed.
94. The comprehensive method to predict urban domestic water usage is used. The water quota includes
resident’s daily water usage and public building’s water usage. It does not include the water usage for road,
landscaping, municipal facility and leakage of pipe networks. The detail of urban domestic water quota
shows in Table 4-1.
Table 4-1: The National Quota of Urban Comprehensive Domestic Quota
Unit: l/pd
City Size Megalopolis Large Cities Medium –small sized Cites
Daily Daily Daily Daily Daily Daily

Zone’s Code
maximum average maximum average maximum average
1 260～410 210～340 240～390 190～310 220～370 170～280
2 190～280 150～240 170～260 130～210 150～240 110～180
3 170～270 140～230 150～250 120～200 130～230 100～170
Notes: 1) Mega city refers to: the non-agricultural population of the city urban and suburb≥ 1,000,000 of City and close
and above; Large city refers to: 500,000＜ the non-agricultural population of the city＜ 1,000,000; small city refers to:
the non agricultural population of the city's urban and suburban areas < 500,000. 2) Zone 1 includes Hubei, Hunan,
Jiangxi, Zhejiang, Fujian, Guangdong, Guangxi, Hainan, Shanghai, Jiangsu, Anhui, Chongqing; Zone 2 includes
Sichuan, Guizhou, Yunnan, Heilongjiang, Jilin, Liaoning, Beijing, Tianjin, Hebei, Shanxi, Henan, Shandong, Ningxia,
Shaanxi, Inner Mongolia Gansu East and east of the Yellow River; Zone 3 includes Xinjiang, Qinghai, Tibet, Inner
Mongolia and Gansu in the west of the west of the Yellow River.
95. Baicheng City and Baishan City belong to medium-small sized city in Zone 2. The designed daily
average water consumption quota of urban domestic water is 110-180 l/pd
4.5 Prediction of Social-Economic Development and Water Consumption Assessment of

Baishan City
4.5.1 The Existing Social-Economic Assessment
a) Population
96. Population of Bashan City During the period of 2001 to 2011, the total population has been
decreasing slightly from 593,400 by 2010 to 599,300 by 2011. The average annual growth rate of
population is -0.99‰, and the urbanization rate keeps stable around 79%.
97. Population of Hunjiang District The population has decreased from 270,030 in 2001 to 244,370 by
2011, and the average decreasing rate is around 10.01‰. The urbanization rate of Hunjiang District was
also stable during the period of 2001-2011, keeping around 76% in the district.
b) Economy
20
98. Hunjiang District The GDP value of Hunjiang District has increased from 150.640 billion CNY in
2001 to 1224,611 billion CNY in 2011, and the industrial added-value has increased from 32.479 billion
CNY in 2001 to 743.627 billion CNY in 2011. The increasing rate of GDP and the industrial added-value
have increased 8.1 and 22.9 times respectively. Details are shown in Table 4-2.
99. From the Table 4-2, it can be found that the proportion of GDP of Hunjiang District in Baishan has
increased from 32.8% to 47.5% from 2001 to 2011. The population proportion of Hunjiang in Baishan has
decreased from 45.1% to 41.2% from 2001 to 2011.
Table 4-2: The Situation of Society-Economy in Hunjiang District
Production value
Population (10,000) Added value present price Population
10,000 CNY Proportions of Population
Urbanization City GDP proportion of
Years GDP in the City growth rate
rate (%) Industrial The First The Secondary The Tertiay (10,000 CNY) Project Area in
Urban Rural Total GDP Total (%) (‰)
added-value Industry Industry Industry the City (%)
2001 26.000 6.900 32.900 79% 150,640 32,479 18,496 87,502 44,642 150,640 459,483 32.8% 54.9%
2002 26.100 6.900 33.000 79% 170,072 31,973 20,493 98,527 51,052 170,072 519,581 32.7% 55.0% 3.04
2003 26.300 6.800 33.100 79% 230,657 33,617 34,306 107,142 89,209 230,657 617,875 37.3% 55.2% 3.03
2004 26.600 6.900 33.500 79% 280,318 57,990 41,696 134,253 104,309 280,258 724,206 38.7% 56.2% 12.08
2005 26.900 6.800 33.700 80% 280,581 104,631 36,470 136,539 107,572 280,581 820,381 34.2% 56.7% 5.97
2006 26.900 6.800 33.700 80% 358,684 162,561 40,088 178,993 139,603 358,684 1,013,418 35.4% 56.9% 0.00
2007 26.900 7.000 33.900 79% 454,442 223,936 44,684 258,390 151,368 454,442 1,258,807 36.1% 57.2% 5.93
2008 28.100 6.100 34.200 82% 580,240 299,251 59,288 310,245 210,707 580,240 1,521,390 38.1% 57.6% 8.85
2009 27.800 6.600 34.400 81% 795,248 436,241 59,297 455,897 280,054 795,248 1,890,411 42.1% 57.9% 5.85
2010 28.100 6.500 34.600 81% 1,001,684 595,718 49,664 615,405 336,615 1,001,684 2,179,728 46.0% 58.2% 5.81
2011 28.300 6.600 34.900 81% 1,224,611 743,627 56,102 783,657 384,852 1,224,611 2,576,521 47.5% 58.8% 8.67
4.5.2 Comprehensive Urban Domestic Water Use Quota
100. Referencing the urban domestic water usage quota in The Integrated Water Resource Planning of
Baishan City, the average urban domestic water quota will be controlled under 100 l/pd and 120 l/pd by
2020, 2030 respectively.
4.5.3 Prediction of Society-Economy
101. The total population was 281,000 by 2011 in the Baishan City. In accordance with the Master
Planning of Baishan City, the overall comprehensive growth trend rate of population is 14.4 ‰. The
population of Hunjiang will reach 321,000 and 345,000 by 2015 and 2020 respectively.
4.6 Water Demand Prediction of Baishan City
4.6.1 Water Demand Prediction Of Baishan City Center

3
102. The daily average water demand and daily maximum water demand will be 135,011 m /d and
3
162,014 m /d respectively by 2020. The daily average water demand and daily maximum water demand
3 3
will be 197,536 m /d and 237,043 m /d respectively by 2025. The predicted water demand is shown in
Table 4-3.
21
Table 4-3 Predicted Daily Water Demand of Baishan City Center Through WSPs
Years 2011 2015 2020 2025
A. Water Demand Forecast
1 Total Population (people ) 593,373 605,330 620,615 642,643
2 Urban Population (people ) 467,958 484,978 507,125 535,581
3 Water Supply Serving Population (people ) 327,571 362,027 410,238 469,513
b Water Supply Serving Population (urban) (people) 327,571 241,507 261,700 286,414
c % water supply for urban population (%) 70% 83% 87% 91%
4 Industrial added value (10,000 CNY) 378,914 762,691 1,617,074 2,165,459
3
a water use Per CNY10000 industrial added value (m /CNY10000) 80 71 61 52
3
6 Domestic water use/demand through WSP (m /d) 18,016 22,087 28,491 37,120
Per capita domestic water use (L/day/capita) 55 61 69 79
3
7 Industrial water use/demand (m /d) 8,305 19,828 52,042 86,268
Industrial water demand supplied by WSP (%) 10% 13% 19% 28%
8 Road watering and land sacping 1,053 1,677 3,221 4,936
9 Public facilities 5,264 8,383 16,107 24,678
3
10 Non-revenue water from the pipeline network (m /d) 19,583 22,492 29,958 36,938
a % leakages from pipelines 50% 33% 20% 14%
b Uncounted water 10% 10% 10% 10%
B. Net water Demand (2010)/Demand Forecast (2011 - 2025) 52,222 74,467 129,819 189,939
C Water required by WSP (4% of net water demand) 2,089 2,979 5,193 7,598
D. Water Demand (2011)/Demand Forecast Through WSP (2012 - 2030)
3
1 Demand /Forecasted Demand (Daily average ) (m /d) 54,310 77,445 135,011 197,536
3
2 Demand /Forecasted Demand (Daily max ) (m /d) 65,172 92,934 162,014 237,043
3
3 Annual Demand /Forecasted Demand (million m /year) 19.82 28.27 49.28 72.10
4.6.2 Water Demand Prediction Of Hunjinag District
103. The daily average water demand and daily maximum water demand of Hunjiang District will be
3 3
97,719 m /d and 117,262 m /d respectively by 2020. The daily average water demand and daily maximum
3 3
water demand will be 153,018 m /d and 183,621 m /d by 2025. Details of Water Demand of Hunjiang
District shows in Table 4-4. The water allocations to domestic water, industrial and other water uses are
shown in Table 4-5.
22
Table 4-4: Predicted Water Demand Through WSPs in Hunjiang District

Years 2011 2015 2020 2025
A. Water Demand Forecast
1 Total Population (people ) 346,141 353,116 362,033 374,882
2 Urban Population (people ) 283,100 291,157 301,551 315,436
3 Water Supply Serving Population (people ) 226,480 241,507 261,700 286,414
b Water Supply Serving Population (urban) (people) 226,480 241,507 261,700 286,414
c % water supply for urban population (%) 80% 83% 87% 91%
4 Industrial added value (CNY million) 227,348 457,615 970,244 1,299,275
a water use Per CNY10000 industrial added value (m3/CNY1000 90 80 68 58
6 Domestic water use/demand (m3/d) 12,683 15,422 16,195 17,007
Per capita domestic water use (L/day/capita) 70 77 87 98
3
7 Industrial water use/demand (m /d) 5,606 11,230 31,964 61,293
8 Road watering and land sacping 507 1,066 2,066 3,468
9 Public facilities 3,658 5,883 11,702 18,682
10 Non-revenue water from the pipeline network (m3/d) 14,595 16,394 21,683 31,572
a % leakages from pipelines 55% 35% 20% 17%
b Uncounted water 10% 10% 10% 10%
B. Net water Demand (2010)/Demand Forecast (2011 - 2025) 37,049 52,756 93,960 147,132
C Water required by WSP (6% of net water demand) 1,482 2,110 3,758 5,885
D. Water Demand (2011)/Demand Forecast Through WSP (2012 - 2030)
3
1 Demand /Forecasted Demand (Daily average ) (m /d) 38,531 54,867 97,719 153,018
3
2 Demand /Forecasted Demand (Daily max ) (m /d) 46,237 65,840 117,262 183,621
3 Annual Demand /Forecasted Demand (million m3/year) 14.06 20.03 35.67 55.85
Table 4-5 Predicted Water Allocation in Hunjiang District

years
Items
2011 2015 2020 2025
A. Domestic Water Use and Industrial Use (million m3/year) 14.06 20.03 35.67 55.85
1 Domestic water 4.63 5.63 7.19 9.27
2 Industrial Use 2.05 5.11 14.17 24.82
3 Road watering and land sacping 0.19 0.39 0.75 1.27
4 Public facilities water 1.34 2.15 4.27 6.82
5 Non-Revenue water from the pipeline network 5.33 5.98 7.91 11.52
6 Water required by WSP (4% of net water demand) 0.54 0.77 1.37 2.15
B. Water Demand Allocation Through WSPs (%)
1 Domestic Water 33% 28% 20% 17%
2 Industrial Water 15% 26% 40% 44%
3 Road watering and landsacping 1% 2% 2% 2%
4 Public facilities water 9% 11% 12% 12%
5 Non-Revenue water from the pipeline network 38% 30% 22% 21%
6 Water required by WSP (6% of net water demand) 4% 4% 4% 4%
C. Water Resource Availability of Reservoirs (million m3/year) 29.20 55.95 55.95 55.95
Water Availability (Qujiaying Reservoir ) (million m3/year) 29.20 29.20 29.20 29.20
Water Availability (Xibeicha Resrvoir) (million m3/year) 26.75 26.75 26.75
D.Water Resource Gap Analysis and Its Potential Allocation (Average Year) 15.14 35.93 20.29 0.10
E. Water Resource Allocation fulfillment Rate Through WSPs (%) (Average Year)
1 Drinking Water 100% 100% 100% 100%
2 Industrial Water 100% 100% 100% 100%
3 Road watering and land sacping 100% 100% 100% 100%
4 Public facilities water 100% 100% 100% 100%
23
4.7 Water Balance Assessment
104. The water balance in Baishan City and Hunjiang District is assessed based on the available water
resource at the design guarantee rate and the predicted maximum daily water demand. Details Shows in
Table 4-9. It can be found that there is a positive water balance assessment between the available water
resource of WSP and the required water demand and the designed capacity of water treatment can be
determined.
Table 6-9 Water Balance Assessment For WSP of Hunjiang District by 2025
3
Unit: 10,000m
Available
Water Treated Balance Balance of
water
water sources demand Water of water daily treated
supply
amount Capacity supply water amount
amount
Qujiaying Reservoir 12 10 8 -2 4
Qujiaying Reservoir 10 8
12 2 1
Xibeicha Reservoir 4 5
5. Technical Assessment of Baishan Water Supply
5.1 Introduction
105. The proposed components include:

• There are about 27.49 km of raw water’s transmission pipeline;
3
• The new WSP with the daily water treatment capacity of 50,000 m /d;
• The total length of water distribution pipelines is about 55.378 km. Of which, the length of
upgrading water distribution pipeline is about 11.138km, the new built water distribution
pipeline is about 44.24km.
106. Two water transmission pipe will be built to transfer the raw water from Xibeicha Reservoir to the
WSPs. One DN900 water transmission pipe delvers 50000 ton/day water to the Hunjiang District new WSP.
The other DN800 water transmission pipe delivers 30000 ton/day water to Jiangyuan District WSP. Figure
6-1 shows the layout of subprojects in Baishan City.
Figure 6-1: The Layout of Subprojects of Urban Water supply in Baishan City
24
5.2 Water Transmission Pipelines
5.2.1 Alternatives Study
A. Analysis on Alternative Water Transmission Pipeline Routes
107. Hunjiang District and Jiangyuan District locate in two sides of the Hunjiang River. Jiangyuang
District locates in the Eastern part of the upper-stream of the Hunjinag River, while Jangyuan District
locates in the Western part of the down-stream of the Hunjinag River. Baishan City has a jurisdiction over
the region and the river source area.
108. The length of pipeline and the amount of affected utilities needs to be minimized. The amount of
the affected buildings, structures and farming land should be minimized. The water lines should avoid
crossing river, railway and road to save investment cost. Energy saving is also a key factor of route
selection. The water distribution is preferred to be delivered by gravity.
B. Alternative Water Transmission Pipeline Routes Of Jiangyuan District
109. The Xibeicha water conservancy Hub power plant is located in the north of Baishan City, and the
Jiangyuan water plant is located in the south of the city. After several route reconnaissances by the
construction units and Design Institute, there are 2 pipe line alternatives.
110. Alternatives 1: The pipeline is buried in the river bed from Xibeicha Reservoir to the WSP in
Jiangyuan District. The total length is 6.8 km.
25
111. Alternative 2: The pipeline is buried on land. starting at Xibeicha Reservoir, crossing Xibeicha
River, Sanchazi Forest Bureau, continuing along the river to reach Hunjiang River Bridge, than crossing
the river again to reach the railroad line, and to Jiangyuan District Hospital and Jiangyuan water treatment
plant. The total length is 6.865 km. Photo 6-1 shows Hunjiang River.
Photo 6-1: Hunjiang River in Jinangyuan District
Table 6-1 Alternative 1 and alternative 2 comparison list

Alternative 1 Alternative 2
Water transmission pipe DN800 L=7500m PN0.6MPa DN800 L=6868m PN0.6MPa
Total investment 58.9 million RMB 20.1 million RMB
112. Table6-1 compares alternatives 1 and 2. The Alternative 2 is selected due to following factors: 1)
It is difficult to build water line in the river; 2) it is difficult for maintenance and operation for Alternative 1;
and 3) Alternative 2 can save 38.8 million RMB for investment.
C. Alternative of The Water transmission Pipeline for Hunjiang District
113. The water transmission line for Hunjiang District is from the east to the west, running through
Sanchazi Town, Jiangyuan Town, Babao Town, Zazi Town to reach Shandianzi Bridge. There are 2
alternatives for the water transmission line.
Alternative 1: From the new hydropower station at Xibeicha Reservoir, the transmission line starts to
crossing the Xibeicha River and continuing along the river to a bridge, crossing the river and a railway to
the hillside of Jiangyuan WSP, continuing along the railway to Highway 201, then reaching the proposed
WSP. The total length of transmission pipeline is 21.14 km. Photo 6-2 shows the Alternative of pipeline
along the railway.
Photo 6-2: The Railway In Hunjiang District
26
Alternative 2: All transmission line is placed in the river bed from Xibeicha Reservoir to the proposed
WSP. The total length is 21.4 km.
Table 6-2：Alternative 1 and Alternative 2 Comparison

Alternative 1 Alternative 2
Water transmission pipe DN900 L=19000m PN0.6MPa DN900 L=16750m PN0.6MPa
DN900 L=1500m PN1.0MPa DN900 L=900m PN1.0MPa
DN900 L=3831m PN1.6MPa DN900 L=2975m PN1.6MPa
114. Table 8-2 compares alternatives 1 and 2. Alternative1 is selected due to following factors: 1)
Alternative 2 is difficult to build; 2) it is difficult for maintenance and operation for Alternative 2; and 3)
Alternative 1 can save 115.06 million RMB.
5.2.2 Engineering Design
a) Hydraulic Calculation Of Pipelines
115. The calculation of the pipe head loss should include the frictional head loss and the local loss of
water head. Because there are a lot of turns in midway of the large pipeline, the local head loss of water
transmission pipe lines is estimated to 20% of the frictional head loss. The pipe diameter of water
transmission pipeline to the Jiangyuan District is DN800mm, and the pipe diameter of water transmission
pipe to Hunjiang District is 900mm.
b) Calculation Of The Water Transmission Pipeline Pressure
116. Jiangyuan Water Transmission Line: The elevation of the outlet for the transmission line at
Xibeicha Reservoir is 619 m, and the distance to the Jiangyuan WSP is about 6.8 km. The elevation of the
inlet at Jiangyuan WTP is 608.65m. There is an elevation difference of 10.35m, which has the adequate
water pressure for the water to flow by gravity.
117. It is estimated that the maximum water hammer pressure will rise to 50%. So the maximum
pressure value of the water transmission pipeline would be 20.70 m. The selected pipe pressure is
0.3MPa.
118. Hunjiang Water Transmission Line: The elevation of the transmission line outlet at Xibeicha
Reservoir is 582 m, and the distance to the proposed WSP is 21.41km. The elevation of the inlet of the
proposed WTP is 520 m. There is an elevation difference of 62 m between the outlet and inlet pipes.
Based on the design calculation, the water can be transmitted by gravity using DN900 pipe.
27
119. It is estimated that the maximum water hammer pressure will rise to 100%. The maximum water
pressure is 124m and the selected pipe pressure is 1.6 MPa.
c) Analysis on Alternative of Pipe Materials
120. The pipe alternatives include steel pipe (SP), fiberglass reinforced plastics pipe (FRPP), ductile
iron pipe (DIP) and high-density polyethylene pipe (HDPEP). An alternative study was conducted in
consideration of material strength, reliability, working pressure, construction convenience, cost, and
antisepsis. The comparison of different pipes is shown in Table 6-3, and the proposed pipe selection is
shown in Table 6-4.
Table 6-3: Comparison of Pipe Materials and Characteristics

No. Item DIP SP FRPP HDPEP
1 Tensile strength (MPa) 3,000 200
2 Strength (MPa) 21,000 60,000

3
3 Density (kg/m ) 7.86 7.86 0.935
4 Brittle temperature (℃) -80
Working pressure (MPa) 0.45-1.0 Wide range 1.4~1.6 1.4~1.6
5
Required the depth of None None >800mm >800mm

6
covering earth
Positive after Positive after

7 Affection on water quality Negative Negative
easy scaling easy scaling
Pipe resistance 0.013* 0.013* 0.0084 0.009

8
coefficient
Socket,
Welding or Dual rubber
9 Connection Socket ring melting, flange
flange ring
or screw
Antisepsis and life-time - 25 years >50 years >50 years

10
Pipe cost (Million 83.41 119.08 126.34 111.00
11 CNY/km)**
Table 6-4: List of Pipe Material

No. Pipe Diameter (mm) Pipe Material
1 >300 DIP
2 <300 HDPE
3 Pipe through river and railway SP
5.2.3 Main Construction Quantity
121. Table 6-5 shows the main pipes for raw water transmission.
Table 6-5: List of Raw Water Transmission Pipes
No. Description Unit Amount
1 DN900 ductile iron pipe (PN0.6MPa) m 15573
28
3 DN900 steel pipe m 423
7 DN800 steel pipe m 20
Total m 27490
122. Table 6-6 shows the major civil works quantities.
Table 6-6: Civil Works of Water Transmission Pipeline

1 Pipe DN900 Km 21.14
2 Pipe DN800 km 8.86
1 Earthwork evacuation m
3 198,210
2 Stonework evacuation m
3 95,281
3 Refill m
3 94,679
4 Cast-in-place concrete m
3 28,070
5 Precast concrete m
3 15,266
123. Table 6-7 lists the additional construction items such as manholes and instruments needed for the
water transmission lines.
Table 6-7: Well and Instrument of Water Transmission and Distribution Pipeline
No. Description Unit Quantity
1 Pipe air emission well Set 26
2 Valve well Set 26
3 Pipe drainage well Set 26
4 Wet well Set 26
5 Pressure release well Set 2
6 Pressure release device Set 2
7 Pressure transmission meter Set 2
8 Flow meter well Set 4
9 Flow meter Set 5
5.3 Water Treatment Plant
5.3.1 Introduction
3
124. The capacity of the proposed new WSP is 50,000 m /d. According to the monitoring data of the
water quality in Xibeicha River provided by Baishan City Environment Protection Bureau in November
2000, the water quality of Xibeicha Reservoir meets the National Standard of Class II of “The Surface
29
Water Environment Quality Standard” (GB3838-2002). The treated water quality of the WSPs should meet
the requirements specified in the “Drinking Water Hygiene Standards” (GB5749-2006). The treatment
process includes flocculation, sedimentation, filtration and disinfection.
5.3.2 Alternatives Study
A. Site Alternatives Of The Proposed New WSP
125. There are 2 sites selected as alternatives of proposed new WSP. Alternative 1 is located in the
area at the south of Xibeicha Reservoir power station. The advantages include:
• The power plant can provide electricity to the proposed new WSP to save long distance
power transmission equipment and cable power loss;
• The land is close to the water resource site to save the cost of raw water transmission
pipe;
• The elevation of the site is about 580-585m which is higher than the service area of
465-481m. The water can be delivered by gravity.
126. However, the site also has the following disadvantages:
• The length of water transmission pipe is 21.04 km. There is a high investment of pipes.
• The elevation difference is about 100 m. The pressure requirement of the pipe is high. The
investment of pipe is also high.
• 30 of households are required for resettlement.
127. Alternative 2 is located at Shandianzi Village. The advantages include:

• The site is close to the service area;
• The total investment is lower than the other alternative. The elevation of Shangdianzi
Village is about 505-536m and the elevation of water service area is about 465-481m. The
water can be delivered by gravity.
128. The disadvantages of the alternative include:
• Earth work is needed to level the site
129. Table 6-8 shows comparison of these two sites. Figure 6-2 shows Shandianzi Village for
Alternative 2 and Figure 6-3 shows the location at Xibeicha Reservoir for Alternative 1. Figure 6-4 shows
the current site view of the proposed WSP at Shandianzi Village. Most of the area is the farming land. The
electricity cable tower will be reset. Figure 6-5 shows the current site view in south of the power station of
Xibeicha Water Conervancy Hub Project.
Figure 6-2: Site for the Proposed WSP of At Shandianzi Village
30
Figure 6-4: Current Site Status of Proposed WSP at Shangdianzi Village
Figure 6-3: Site of Proposed WSP at Xibeicha Reservoir
Figure 6-5: Current Site Status in southern of the Power Station of Xibeicha Water Control Project
31
Table 6-8: Comparison between Alternative 1 and Alternative 2

Land in southern of the power
Land Land at Shandianzi Village station of Xibeicha Water Hub
Project
Diameter, length and pressure of DN900 L=16750m PN0.6MPa
water transmission pipeline DN900 L=900m PN1.0MPa DN900 L=200m PN0.6MPa
DN900 L=2975m PN1.6MPa
Diameter, length and pressure of DN1000 L=17000m PN0.6MPa
water distribution pipeline from DN1000 L=5602m PN1.0MPa DN1000 L=900m PN1.0MPa
WSP to Baishan Urban Area DN1000 L=7300m PN1.6MPa
Resettlement None 50 households
3 3
Site leveling quantity 32,000m 49,914m
Power cable mode and length YJV29-10-3×50 L=3000m YJV29-10-3×50 L=500m
Land area 4.25ha 4.25ha
Total investment 125.87 million CNY 153.02 million CNY
130. According to Table 6-8, Alternative 2, the site at Shandianzi Village, will save about 27.15 million
CNY for the construction cost. Therefore, Alternation 2 is selected as the proposed land for new WSP..
B. Alternatives Of Water Purification Process
a) The Alternative of Water Purification Process
131. The conventional treatment process is applied in the proposed WTP. The treated water quality
shall meet the standard as specified in “Drinking Water Hygiene Standards” (GB5749-2006). The water
treatment process is shown in Figure 6-6. The sludge treatment process is shown in Figure 6-7.
Figure 6-6: The Water Treatment Process Of WSP In Baishan City
Chlorine
Chlorine Flocculent dioxide
dioxide
Raw water Intake Mixing Wave Sloping V filter Clean Distributi Water
pumping tank plate pipe water on supply
house floccula sedime tank pumping pipeline
tor ntation station
tank
Figure 6-7: The Sludge Treatment Process
32
Supernant used as raw

Drainage water
Backwashed water
tank
from V filter Leachate
Sludge
cake for
Sludge from Sludge Sludge Sludge Slude
disposal
sedimentation tank tank thickener equalization dewatering
tank machine
Supernant drainage
b) Primary Oxidant Chemical Alternatives
132. The primary oxidant chemical is added for water treatment, and the comparison is showed in
Table 6-9. Chlorine dioxide is used for better safety. The effective chlorine concentration in chlorine
dioxide is 2.63 times than chlorine liquid and the disinfection efficiency is 2.5 times than chlorine liquid.
Using Chlorine dioxide requires less equipment investment and labor works. The chlorine dioxide has
being used widely as primary oxidant chemical in many WSPs. The operation cost is 0.0047 CNY/m3,
which is cheaper than the cost of potassium permanganate. Based on the comparison, the chlorine
dioxide is selected as the primary oxidant chemical for proposed new WSP.
Table 6-9: Primary Oxidant Chemical Alternatives

Oxidant chemical Chlorine dioxide Potassium Permanganate
• Applied widely in many WSPs
• Hydraulic retention time is 30 • None hazard to human
minutes. This requires smaller • Only required simple dosing
Advantages reaction tank volume equipments
• Safe, high efficiency, high disinfection • Treated water has no smelly or
rate bitter taste.
• Price is cheaper
• Hydraulic retention time is 60
minutes. This requires a bigger
reaction tank volume
• Additional chemical preparation
Disadvantages • A little lower efficiency equipment and labor works are
required.
• Potassium permanganate is
more expensive than Chlorine.
• Price is higher
Dosage (mg/L) 1 2
3
Operation Cost (CNY/m ) 0.0023 0.007
c) Flocculator Alternatives
133. A porous-plate flocculator and a wave-plate flocculator are compared. The wave plate flocculator is
selected. The comparison is shown in Table 6-10. .
Table 6-10: Flocculator Alternatives

Flocculator porous Plate Flocculator Wave plate Flocculator
• Smaller land area requirement and less
• Less equipment and material
Advantages civil works;
cost
• Simple equipment structure
• Higher civil works cost
Disadvantages • Higher Equipment and material cost
33
Cost (Million CNY) 3.56 3.78
d) Sedimentation Tank Alternatives
134. The sloping-plate sedimentation tank and the sloping-pipe sedimentation tank are compared.
The sloping-pipe sedimentation tank is widely used in WSPs. The comparison is shown in Table 6-11.
Table 6-11: Sedimentation Tank Alternatives

Sloping Plate Sedimentation Sloping Pipe Sedimentation
Sedimentation Tank
Tank Tank
• Applied widely in WSPs

• Simple water outlet;
Advantages • Better hydraulic conditions
• Less sludge
• Easier installation
• Complicated outlet
• Shorter sloping pipe
• More cost of sloping plates
Disadvantages replacement compared to
• Difficult for installation
sloping plate
e) Filter Alternatives
135. The v-filter and the fast-filter are compared and the results are shown in Table 6-12. The v-filter has a
better backwash system to ensure it has a longer operation interval before next backwash. The v-filter has
a faster filtration rate and with less investment, and it is selected as the filter for the new WSP.
Table 6-12: Filter Alternatives

Filter types Fast-filter V-filter
• Longer operation interval before next

• Tank height is lower than the backwash
V-filter • Faster filtration rate
Advantages
• Adjustable filtration rate for • Equal influent distribution
better treated water • Has a better air- water backwash and a
surface swipe wash system
• More tanks and valves than • Additional auxiliary equipment

Disadvantages V filter • More complicated civil works structure
• Additional backwash system Tank height is more than the fast-filter
C. Engineering Design
3
136. The daily water supply capacity of the new WSP is 50,000m /d and the design year is 2020. The plant
site is near Shandianzi Village. The water treatment process includes mixing, sedimentation, filtration and
disinfection. The sludge treatment process includes a sludge tank, a sludge thickening tank, a sludge
conditioning tank and a sludge dewatering equipment. Figure 6-8 shows the layout of new WSP.
Figure 6-8: Layout of Proposed New WSP
34
137. The main structures of the new WSP include chemical dosage room, water treatment workshop,
blower room, etc. The main civil works include earthwork and stonework, refill and cast-in-place concrete,
etc. The summary is shown in Table 6-13.
Table 6-13: Civil Works of New WSP
3
1 Earthwork and stone evacuation m 253,000
3
2 Earthwork and stone refill m 215,000
3
3 Lack of refill m 32,000
138. The structures and buildings are designed based on the requirement of water treatment process,
power, office, heating, repair, storage and safety. Attachment 6-1 shows main structures and buildings of
the new WSP. The equipment is designed based on the requirement of water treatment process. Table
6-14 lists main equipment and instrument in the new WSP, and the details are shown in Attachment 6-2.
Table 6-14: Main equipment and Instrument of New WSP

Description
No.
A Process Equipment
i Outdoor plant area
ii Chemical dosing room
iii Water treatment workshop
Mixing tank, wave-plate flocculator and sloping-pipe sedimentation tank
V filter
Backwash pumping room
iv Blower room
v Chlorine room
35
Description
No.
vi Drain tank and sludge tank

vii Sludge thickening room
viii Sludge dewatering room
B Electrical equipment, auto control equipment and instrument
i Electrical equipment
ii Auto control equipment
C Instrument
D Repair equipment
E Lab
F Vehicle
5.4 Water Distribution Pipeline
5.4.1 Engineering design
A. Hourly Variation Ratio And The Additional Allocated Water Amount
139. According to the overall Urban Plan Of Baishan City and giving a comprehensive consideration of
the scale of the City and economic development in the city, as well as the hourly variation of water usage,
the water variation coefficient is 1.4 in Baishan City is selected.
B. Water Distribution System
140. After the project is completed, the urban water supply will be provided by both the existing
Nanshan WTP and the new proposed WTP. According to the overall city’s planning, the project area
covers the water distribution network in the north of Hunjiang River and the south area of the railroad
.
C. Principles Of Network Layout
141. Considering the poor condition of the existing water distribution pipes and smaller diameters, it is
planned to rehabilitate the pipe network with problems. The project is also to include the new water
distribution network
.
D. Pipe Networks Calculation
142. The model of hydraulic calculation for Hazen -William Formula is used:
10.7 × Q 1.852
i = 1.852 4.87
C D
where
i---section of water head loss along tubes, m/m;
3
Q- pipe flow, m /s;
D –pipe’s diameters, m;
C –pipe’s friction coefficient.
143. The C value of pipe’s friction coefficient is based on the pipe materials. For the Project, the C
values are determined as 110 for new pipes, and 120 for the renovation and expansion pipes. The design
considerations are as followings and the water distribution network is shown in Figure 6-9.
3
• The maximum daily capacity of the water distribution pipeline is 130,000 m /d and the hourly
variation ratio is 1.4. The water pressure is 0.28 MPa at the end point of pipeline network. The
36
pressure design meets the requirement of Code of Design on Building Fire Protection and
Prevention (GB50016-2006).
• The pipe material is DIP with diameter larger than DN 300mm while the pipe material is HDPEP
with diameter equal or smaller than DN 300mm.
Figure 6-7: Layout of Water Distribution Pipeline Of Hunjiang District
E. Design of Rivers-Crossing and The Railway-Crossing For Distribution Pipelines
144. There are 4 booster pumping stations required to keep the pressure of the distribution pipeline.
The summary of the pump stations is shown in Table 6-15.
Table 6-15: Mid-way Pumping House Equipment List

Description Type/mode Unit Amount
3
Vertical centrifuge pump Q=160m /h H=30m N=22.0kW Set 9
3 Set
Vertical centrifuge pump Q=320m /h H=30m N=30.0kW 3
Submersible pump Q=/h H=15m N=1.1kW Set 4
Crane T=2t Lk= Set 4
37
F. SCADA System
145. The SCADA system is included bases on a GPRS wireless network to monitor the pressure and
flow of the pipeline network to improve the energy conservation. This SCADA system includes a set of
data collections, GPRS data transfer and command center. The system will monitor the pressure and flow
through RTU system, and the GPRS wiles system will transfer the data through the CGSN to the data
center server. The coordination center server will collect and deal data with HMI software. The operator will
operate the water distribution system based on the analysis result. Table 6-16 shows the equipment and
fittings for the SCADA system.
Table 6-16: List of SCADA System Equipment
Description Type/mode Unit Amount

RTU Set 20
GPRS data terminals Set 20
Power and metering box Set 20
Measurement box Built-in RTU, pressure and flow transmitters Set 20
Power and control cable Set １
146. The civil works of water transmission and distribution pipeline are summarized in Table 6-17. The
total length of water distribution pipeline is about 52km, including 18km of upgrade pipeline and 34km of
new built pipeline as shown in Table 6-18. Table 6-19 lists the manholes and instruments needed for the
water transmission and distribution pipeline system.
Table 6-17: Civil Works of Water Transmission and Distribution Pipeline

3
1 Earthwork evacuation m 141,470
3
2 Stonework evacuation m 60,630
3
3 Refill m 162,690
3
4 Cast-in-place concrete m 4,013
Table 6-18: Pipe Amount of Water Distribution Pipeline
No. Diameter mm Material Length (m)
1. New built pipe

1.1 DN200 PE 2393
1.2 DN300 PE 11,597
1.3 DN300 Steel pipe 60
1.4 DN400 Ductile iron pipe 6,917
38

Sub 44,240
2. Upgrade pipes
2.1 DN300 PE 572
Sub 11,138
Total 55,378
Table 6-19: Manholes and Instrument of Water Transmission and Distribution Pipeline
1 Valve well Set 113

2 Pipe air emission well Set 54
3 Pipe drainage well Set 54
4 Wet well Set 54
5 Fire plug Set 28
6 Pressure indication well Set 8
7 Flow meter well Set 12
8 Pressure transmission meter Set 8
9 Flow meter Set 12
6. Technical Assessment of Baicheng City
6.1 Introduction
147. In Baicheng City, the existing water supply system was upgraded in 2006. The existing water
source, the capacity of water treatment can meet the requirement of water demand for the city. But in the
northwestern part of the city, there is a need to provide new municipal services for the new urban
development.
6.2 Engineering Design

3
148. The projected maximum daily capacity of the water distribution pipeline is about 297,000 m /d by
3
2030. The current water supply capacity from 3 existing water treatment plants is 935,000 m /day and the
current water treatment plants have adequate capacity to supply the water for the new urban expansion.
Based on the alternative study, diameter of the water supply pipe is DN > 400mm, the ductile iron pipe with
flexible rubber interface will be selected. For the pipe diameter of the water supply pipe DN ≤ 400mm, PE
pipe will be used. The major construction quantities are shown in Table 7-1.
39
Table 7-2: Main Construction Quantities for Bacheng Water Supply Engineering
Pipe length Diameter of Pipe

Name of streets Properties
᧤m᧥ lines ᧤mm᧥
New construction 2650 DN500

No.3 Road
Xiangyang Street
Xinhua west Road
New construction 1000 DE160
Shengli Road New construction 2313 D500
Chunyang Road New construction 1100 DE225
The North of Xingfu Sterrt New construction 1330 DE315
No.1 the South Street (The
Nanyi Street)
Tao-er River Road New construction 3804 DE315
The Xinggong Road New construction 1498 DE315
Total 37,273
7. Operation and Maintenance
7.1 Successful Experience in China and Abroad
7.1.1 Importance of Operation & Maintenance to Water Supply Systems
149. The water supply system is one of the most important infrastructures in urban, which is also a
large energy consumer with huge energy-saving potential. Reducing the energy consumption of the water
supply system is the requirement of social healthy development to water supply enterprises, but also the
main approach of water supply enterprises to improve the economic benefits. As the water supply systems
is large in investment, complex in system and involve wide ranges, currently in the planning, design, and
operation management of our water supply system, there is an irrational phenomenon to vary degrees,
because the use of energy is inefficient and a waste of energy, and result in the increase business costs.
Therefore, aiming at urban water supply system, from the several major points of water supply system,
energy saving and optimization of water pumping station, energy saving and optimization of water
distribution networks, scientific control of pipeline leakage and optimal selection of water supply pipelines
are necessary for the proposed project.
7.1.2 Measures adopted on Energy Saving
(i) Energy saving and optimization of water pumping station.
150. In urban water supply systems, the upgrade of pump stations and optimal operation are the main
ways to reduce energy consumption. For energy saving upgrading methods of pump station in theoretical,
40
it is needed to find ways to optimize the selection of pump stations, and to build a mathematical model to
optimize selection of water pumps. Reasonable planning and design of water supply network is the critical
step to achieve energy saving. One of principles of the energy saving is to the zone water supply of the
water pipe network, the reasonable method of pipe network layout, the pipe layout and the choice of pipe
layouts of the long-distance water pipe. Together with the zone network investment and operating cost, it is
required to establish a cost model of pipeline network about reasonable partition.
(ii) Optimal election of water supply pipe
151. Optimal selection of water supply pipe is an important aspect of energy saving and investment
reducing in pipe network. Under comprehensive consideration of water quality, safety and reliability, water
conditions and other factors, value analysis method is applied to optimize the selection of water supply
pipe. Transmission pipes, large-medium and medium-small diameter water pipeline are recommended in
selection and usage.
(iii) Measures To Improve Efficiency of Pumps
1. The urban water supply system is one of the largest power consumption users, and about more than
90% of electricity consumption of water supply enterprises is consumed in the lifting of water supply by
pump motors. Therefore, the energy consumption of pumping stations is directly affecting the energy
saving condition of the whole water supply system. The rationality of pump stations on energy
consumption mainly depends on the following three aspects: 1) whether there is the pump lifting head is
reasonable. 2) whether there is a high pump efficiency. 3) whether there is a reasonable pump's
combination. Therefore, the energy consumption can be reduced by reducing the pumping water volume
and the water head properly, and improving the operation efficiency of pumping station (through the
optimization of high pump's combination, to set a water tank with a reasonable elevation and volume). Of
which, the optimization approach of pump operation and optimal time control of different lift of pump
operation (according to the actual flow of the pump station) will have a significant impact. In order to
achieve the purpose of reducing energy consumption, the combined optimum method of variable-speed
pumps and constant-speed pumps makes the carrying capacity of pumps the same with the actual water
consumption tally under the same time constant pressure water pump and obviously, the variable-speed
pumping has not only kept constant pressure water supply, but also saved energy and reduced pipe
5
leakage rate .
(iv) Energy Saving Through Reducing the Total Water Head
152. Energy consumption can be effectively reduced by reasonable reducing the total water head of the
water supply system. In order to reasonably reduce the total head system, water supply enterprises can be
adopted according to their different circumstances of local conditions to take the regional water supply,
midway pressurized water supply means, and set pools in the conditional place at high position or takes
the gravity flow and the pressure flow mixing water supply mode.
(v) SCADA System
153. The design proposed a SCADA system for monitoring and control for energy saving. The SCADA
system will guide the operators to adjust the pumps in the water distribution pumping station according to
the flow and pressure of the monitoring points set in the water distribution pipeline network. The pumps will
work according to the real requirement of the water supply in the project area.
10. Jurnal of Chongqing Architecture University. Wang pu, Jiang Zhixian, Shi Chang’en. Vol . 24 No. 4 Aug. 2002
41
8. Conclusions and Recommendations

154. The project will support the PRC’s sustainable urban and rural development policy, and approved
Baishan City’s Socioeconomic Development Master Plan. The technical solution is feasible. The Baishan
City Government shall ensure that emergency preparedness and response mechanisms for drinking water
source protection and water supply safety are developed for the project in compliance with relevant PRC
regulations and the Asian Development Bank’s EHS Guidelines.
155. Jiangyuan District and Hunjiang District share a common drinking water source. it is
recommended to coordinate the water supply for the two districts for an integrated urban water supply
management in Baishan City.
64. There is an integrated capacity building planning by focus on improving the water supply
management skill. It is critically important to provide loan implementation and management assistance by
consultants on project management, construction supervision and O&M during the loan implementation for
meeting the objectives envisaged during the PPTA stage and for a successful construction of the Project.
42
Attachment 6-1: Details of Structures and Buildings of New WSP
No. Structure/Building Dimension Unit Quantity
1 Chemical dosing room 38.1m×12 Se 1
2 Water Treatment Workshop 90.0m×42 Se 1
Mixing tank, Wave plate flocculator tank

(1) 44.25m×1. Set 2
and sedimentation tank
(2) V filter 22.80m×1. Set 2
(3) Backwash pumping room 6.0m×16.. Set 1
(4) Blower room 6.0m×10.. Set 1
3 Clean water tank 42m×30m×m Set 2
4 Chlorine room 13.5m×13 Se 1
5 Drain tank 15.0m×6.9m Set 2
6 Sludge tank 15.9 Set 2
7 Sludge thickening room 36.0m×18. Set 1
8 Sludge dewater room Φ9.0m H=6 Set 2
(1) Sludge conditioning tank 4.5m×3.62 Set 2
(2) Sludge dewater room 12.0m×10. Set 1
9 Sludge piling site 12.0m×7.5m×5.7m S 1

2
10 Office building 1000m S 1
2
11 Repair and storage room 740m Se 1
2
12 Boiler room 300m Se 1
13 Sludge storage area 12.0m×7.7 Set 1

2
14 Gate house 32m Set 1
43
Attachment 6-2: Details of Equipment & Instrument of New WSP
No. Description Type/Mode Unit Quantity

I Process Equipment
i Outdoor plant area
1 Pipe mixer DN150 PN1.0MPa Set 1
3
2 Sampling pump Q=2.5m /h H=20m N=0.75kW Set 2
3
3 Mobil submersible pump Q=100m /h H=10m N=7.5kW Set 1
ii Chemical dosing room
1 Electrical crane T=1t, L=9.0m Set 1
Aluminum sulfate metering Set
2 Q=500L/h H=40m N=0.37kW 6
pump
Aluminum sulfate metering Set
3 Q=250L/h H=40m N=0.25kW 4
pump
Aluminum sulfate 3 Set
4 Q=3.3m /h H=15m N=1.5kW 4
submersible transfer pump
Aluminum sulfate transfer 3 Set
5 Q=3.0m /h H=15m N=1.5kW 2
pump
6 Mixer Φ900 N=1.5kW Set 6
iii Water treatment workshop
Mixing tank, wave plate flocculator and sloping pipe sedimentation tank
Paddle mixer (1st phase Set
1 D1000 N=5.5kW 2
mixing)
Paddle mixer (2nd phase Set
2 D1000 N=2.2kW 2
mixing)
3 Sludge scraper W=5.60m L=27m N=2.2kW Set 2
Cast iron gate lined with Set
5 copper with electric and 1000x1000 N=1.5kW 2
manual hoist
Cast iron gate lined with Set
6 copper with electric and 900x1000 N=1.5kW 2
manual hoist
A stainless steel wave plate
7 1480x980x2000 Set 34
box
B stainless steel wave plate
8 1480x1180x1450 Set 36
box
Φ35, L=1000, θ=60º
2
9 Sloping pipe media m 610
10 Stainless steel sump 350×550×5300 b=5 Pc 60
V filter
Light square gate with
11 600 x 600 N=1.5 kW Set 6
electrical and manual hoist
Light square gate with
12 500 x 500 N=1.5 kW Set 6
electrical and manual hoist
13 Electrical hoist T=1t Set 2
3
14 Submersible pump Q=10m /h H=15m N=1.1kW Set 2
3
15 Quartz sand media 0.9~1.2mm K80<1.3 m 432
3
16 Corse sand support layer 2~4mm m 36
Backwash pumping room
44

3
17 Horizontal centrifuge pump Q=650m /h H=10m N=22.0kW Set 3
3
18 Horizontal centrifuge pump Q=7.5m /h H=55m N=7.5kW Set 3
3
19 Submersible pump Q=10m /h H=15m N=1.1kW Set 1
20 Electrical beam crane T=2t, L=3.0m Set 1
iv Blower room
1 Roots blower Q=29m3/min H=5.0m N=30kW Set 3
2 Electrical single beam crane T=2t L=3.0m Set 1
v Chlorine room
1 Electrical single beam crane T=2t Lk=6.0m Set 1
Cabinet vacuum auto
2 Flow=0=10kg/h Set 3
chlorine dosing machine
3 Chlorine gas filter Set 2
4 Chlorine detector with alarm 0~10ppm Set 1
Chlorine adsorption
5 Adsorption capacity=1000kg/h Set 1
equipment
6 Electric balancer 0-2T Set 2
7 Gas mask Set 2
vi Drain tank and sludge tank
3
Q=100m /h H=15m Set
1 Submersible pump 4
N=11kW
Submersible pump with 3 Set
2 Q=30m /h H=15m N=3kW 4
mixer
Submersible pump with 3 Set
3 Q=10m /h H=6m N=0.75kW 2
mixer
4 Submersible mixer N=2.2kW Set 4
vii Sludge thickening room
1 Sludge thickener Φ9000 N=0.55kW Set 2
3 Set
2 Sludge screw pump Q=2.5-5m /h H=6m N=1.5kW 4
3 Sludge shredder DN150 N=1.5kW Set 4
4 Mixer N=2.2kW Set 2
viii Sludge dewatering room
3 Set
1 Sludge centrifuge Q=5-10m /h N=15kW 2
Flocculation chemical Set
2 Q=500-1000L/h N=1.5kW 2
equipment
3 Flocculant metering pump Q=250-500L/h H=20m N=1.1kW Set 4
Horizontal anaxial screw 3 Set
4 Q=1.5m /h L=4.0m N=3.0kW 1
conveyor
3 Set
5 25° anaxial screw conveyor Q=1.5m /h L=8.6m N=1.5kW 1
6 Electrical single beam crane T=2t Lk=7.5m Set 1
B Heating and airing equipment
i Equipment in boiler room
ii Airing equipment
B Electrical equipment, auto control equipment and instrument
45

i Electrical equipment
1 High voltage switch cabinet Set 9
2 DC screen DC 220V 65Ah Set 1
3 Voltage transformer SCB10-800/10 Set 2
Low voltage distribution Set
4 27
cabinet
5 Power distribution box XL31 Set 6
6 Filter on-site control platform None standardized Set 6
ii Auto control equipment
1 Operation station Industrial control class computer Set 2
2 UPS Sn=3kVA Un=~220V Set 4
3 Printer Color, spray, A3 Set 2
4 Ejector DLP front ejector Set 1
5 Ejector screen Manual bead type Set 1
6 PLC Set 3
iii Instrument
1 Solenoid flow meter Separate and Integrated Set 11
3 Hot matter flow meter Separate Set 1
4 Ultra sonic level meter Separate Set 16
5 Pressure transmitter Set 12
6 Turbidity analyzer High range and low range Set 9
8 pH analyzer On-site and sample Set 2
10 Residue chlorine analyzer Sample Set 1
Hazard gas detector with Set
11 Dual detector 1
alarm
II Repair equipment
1 Engine lathe C616 Set 1
2 Drilling machine Z3035B Set 1
0.5m3/min Set
4 Air compressor 1
Max. Pressure=0.7MPa
5 Electrical hoist T=5t Set 1
6 Vise Set 3
7 AC welder 330A Set 1
8 DC welder 375A Set 1
3 Set
9 Ethyne generator Capacity=1m /h 1
10 Oxygen vessel 40kg Pc 3
III Lab Device
Pipe electric resistance Set
1 SK-6-10 1
furnace
Electrothermal thermostatic Set
2 202-II 1
drier
3 Electrothermal thermostatic HH-B11-600 Set 1
46

incubator
Electrothermal pavilion Set

4 1
distiller
Electrothermal thermostatic Set
5 HH.S11.4 1kW 1
water bath
6 Spectrophotometer WY×-402 Set 1
7 Photo colorimeter Set 1
8 Turbidity analyzer GDS Set 2
Fast residue chlorine color Set
9 2
comparator
10 Conductivity analyzer Set 1
11 pH meter Set 1
12 Ion chromatograph Set 1
13 Air phase chromatograph Set 1
Inductively Coupled Plasma - Set
14 1
Mass Spectrometer
15 Liquid phase chromatograph Set 1
16 Background lowαβ detector Set 1
17 BOD detector Set 1
18 Ultra-pure water macine Set 1
19 Microorganism suck and filter Set 1
20 Stage control filter Set 1
Two kinds of bacteria Set
21 1
detector
22 Extractor Set 1
Auto 1/10000 precise Set
23 1
balancer
24 Refreeze Set 2
25 High times microscope Set 2
26 Biological microscope Set 2
27 Electric 6 units mixers Set 1
High pressure steam Set
28 1
disinfector
VI Vehicles
1 Vane set 1
2 Bus set 1
3 Jeep Set 1
4 Pickup truck Load: 2.0t Set 1
5 Truck Load: 4.0t Set 1
6 Sludge truck Load: 10.0t Set 1
47
Non-Revenue Water (NRW) Assessment
1. INTRODUCTION
1. Most developed countries have a solid infrastructure and established operational

practices for managing and controlling non-revenue water (NRW). This is not always the case
in developing countries; many are struggling to ensure that customers receive a reasonable
supply of safe drinking water, often via a pipe network that is inadequate, with poor record
systems and a low level of technical skills and technology. Tariff system and revenue collection
policies often do not reflect the true value of water supplied, which limits the utility's cost
recovery and encourage customers to undervalue the service.
2. NRW is a globe problem requiring a management strategy that can be globally applied.
Developing such a strategy requires a diagnostic approach to identify the problem, and then to
use the available tools to reduce or remove it. Following a step-wise process--asking some
basic questions about the utility policies and practices, and then undertaking the appropriate
tasks to answer them-- is the basis of successful strategy development. The philosophies,
concepts, and recommendations, especially those recommended by the IWA and the World
Bank Institute, reflect international best practice.
3. Developing country like China faces similar challenges in reducing NRW, including
aging infrastructure, financial constraints, poor project design and installation. Many utilities in
China, however, can draw on motivated and industrious staff to implement solutions once the
challenges of reducing NRW have been identified.
4. ADB has worked with the PRC on NRW reduction in several projects, but there are still
limited practical examples and experiences in addressing the issues in cold region, like north-
east China in Jilin province. The project provides a better chance to addressing and
assessment this issue based on previous knowledge and skills. This could serve as
demonstration which will also help other similar places in the PRC improve non-revenue water
management performance.
5. Based on the 2012 water supply statistics data of Baishan city in Jilin, current situation
and status for Baishan as follows:
• There are three water plants in Baishan city, including two ground water plants and one
surface water plant. The average output water volume is 43 MLD in 2012. The
popularity rate is 70%. The daily per capita water consumption is 75 liter/day/capita.
• Total lengths of pipe which diameter above 75 mm are 225 KM. The NRW rate is 65%.
Total water consumers are up to 102,085, including 93,744 domestic consumers.
• The average pressure 0.22 MPa and the water supply covering 30 km2 areas.
• Water power consumption per unit is 115 kWh / 1000 m3.
• Annual sales income for Baishan water utility is CNY15, 440,000 and annual net profit is
– CNY7, 020,000. The number of total staffs is 597.
• With 2004 water policy, water tariff system is shown as follows: domestic water
consumer 2.3 CNY/m3, administrative water consumer 4.0 CNY/m3, industrial water
consumer 4.0 CNY/m3, business water consumer 4.8 CNY/m3 and special high-water-
consumption sector 8.0 CNY/m3 respectively.
2
2. THE PROPOSED PROJECT TARGETS
(1) Implement a diagnostic of the NRW situation, possible targets, and timeframes for
NRW reduction;
(2) Identify investments needed, expected results and other changes including
organizational, legislation, and contractual that would be needed to enable NRW
reduction to occur;
(3) Formulate a capacity development to enable the achievement and sustain targeted
NRW levels;
3. ESTABLISHMENT AND CHECK OF WATER BALANCE
3.1 Water balance analysis theory

6. Water balance is a method of quantifying and analyzing the System Input Volume and
System Output Volume. The fundament of water balance analysis theory is that for a water
supply system, the overall water volume calculation should be balanced through measurement
or definition of the volume of produced, input, output, and lost water. Theoretically, each of the
water balance components can be quantified in a fixed period, and water balance analysis of
the water supply system can be complemented by investigating the input and output and
collecting relative data. Therefore, introduction of water balance can help quantify the
components and the lost water more precisely.
7. To most water utilities, the level of NRW is a key performance indicator of efficiency.
However, most utilities tend to underestimate NRW because of institutional and political
pressures, as well as a lack of knowledge to properly determine the NRW level. Reports of low
levels of NRW are eagerly accepted by senior managers. However, reported low levels of
NRW, whether due to deliberate misinformation or, more likely, a lack of accurate information,
will not help the water utility to reduce its costs or increase revenue. Instead, it will mask the
real problems affecting the water utility’s operating efficiency. Only by quantifying NRW and its
components, calculating appropriate performance indicators, and turning volumes of lost water
into monetary values, can the NRW situation be properly understood and the required actions
taken.
8. Water balance helps utility managers to understand the magnitude, sources, and cost of
NRW. The International Water Association (IWA) has developed a standard international water
balance structure and terminology (Table 3.1).
Table3.1: Water balance showing NRW components
Billed Metered Consumption

Billed Authorized Revenue
Consumption Billed Unmetered Water
Consumption
Authorized
Consumption Unbilled Metered
System Unbilled Consumption
Input Authorized
Consumption Unbilled Unmetered
Volume Consumption Non-Revenue
Water
Unauthorized Consumption
Commercial
Water Losses
Losses Customer Meter
Inaccuracies and Data Handling
3
Errors
Leakage on Transmission
and Distribution Mains
Leakage and Overflows from
Physical Losses the Utilities Storage Tanks
Leakage on Service
Connections up to the Customer
Meter
9. Non-revenue water (NRW) is equal to the total amount of water flowing into the water
supply network from a water treatment plant (the ‘System Input Volume’) minus the total
amount of water that industrial and domestic consumers are authorized to use (the ‘Authorized
Consumption’).
NRW = System Input Volume - Billed Authorized Consumption
This equation assumes that:
a. System input volume has been corrected for any known errors
b. The billed metered consumption period for customer billing records are consistent
with the System Input Volume period.
10. Utility managers should use the water balance to calculate each component and
determine where water losses are occurring, as described in the next sections. They will then
prioritize and implement the required policy changes and operational practices.
3.2 Steps for establishing water balance

11. Water balance is conducted by calculating or estimating the input, output, consumption
and losses of the water supply system. The significance lies in being capable of clearly
describing and quantifying every system component and hence making the water losses more
easily understood. Initially the volume of each water balance component need be calculated;
the key part of which is to decompose NRW into Unbilled authorized consumption, apparent
losses and Physical losses. Generally, steps to calculate water balance components are as
follows:
Step 1. Determine system input volume

Step 2. Determine billed metered consumption and billed unmetered consumption
which sum up to revenue water
Step 3. Determine NRW by subtracting revenue water from system input volume.
Step 4. Determine unbilled metered consumption and unbilled unmetered
consumption which sum up to unbilled authorized consumption.
Step 5. Determine authorized consumption by adding revenue water to unbilled
authorized consumption.
Step 6. Determine water losses by subtracting authorized consumption from system
input volume.
Step 7. Estimate unauthorized consumption and customer metering inaccuracies
properly which sum up to apparent losses.
4
Step 8. Determine physical losses by subtracting apparent losses from water losses.
Step 9. Estimate real loss components in feasible methods which include night flow
analysis, burst frequency / leakage flow rate / leakage duration, modeling and
etc. Add components of physical losses and cross-check with the physical
losses as derived from Step 8.
3.3 Water balance analysis of Baishan’s water supply system

a. Setting a research period
12. Given water balance’s essential relation to time, water utility should choose a period for
analyzing and evaluating the total system consumption. According to Baishan water utility’s
statistics, utility can define the whole year of 2012 as the water balance research period and
use relative volume data from Jan 1, 2012 to Nov 31, 2012, so as to reduce the influence of the
time lag between water consumption and meter reading. Besides, this period also involves the
seasonal element.
Table 3.2: Water balance of Baishan water supply system

in 2012 after check and verification
Unit: m3
Billed Billed Metered Consumption
Authorized 5,538,840 Revenue Water
Consumption 5,712,000
5,712,000 Billed Unmetered Consumption
Authorized
173,160
Consumption
5,719,135 Unbilled Metered Consumption
Unbilled 0
Authorized
Consumption Unbilled Unmetered
7,135 Consumption
System Input 7,135
Volume Unauthorized Consumption
16,083,600 Commercial 453,703
Losses Non-Revenue
Customer Meter Inaccuracies
2,846,413 Water
and Data Handling Errors
10,371,600
Water 2,392,710
Losses Reported Bursts
10,364,465 2,442,002
Physical
Unreported Bursts
Losses
4,892,713
7,518,052
Background Leakage
183,337
4. ASSESSMENT OF CURRENT INFRASTRUCTURE LEAKAGE SITUATION

AND ANALYSIS OF LEAKAGE REDUCTION STRATEGY
a. Calculation results of 2012 water balance
Table 4.1: Percents of 2012 water balance components in SIV
Authorized Billed
System Input Billed Metered Consumption Revenue Water
Consumption Authorized
Volume 34.438% 35.515%
35.559% Consumption
5
35.515% Billed Unmetered Consumption

1.077%
Unbilled Metered Consumption
Unbilled 0
Authorized
Unbilled Unmetered
Consumption
0.044% Consumption
0.044%
Unauthorized Consumption
Commercial 2.821%
Non-Revenue
Losses Customer Meter Inaccuracies
17.697% Water
and Data Handling Errors
64.485%
Water 14.876%
Losses Reported Bursts
64.441% 15.183%
Physical
Unreported Bursts
Losses
30.421%
46.744%
Background Leakage
1.140%
Picture 4.1: Column diagram of Baishan’s water balance components in 2012
b. Non-Revenue Water (NRW)

13. In 2012, NRW of Baishan water supply system is 10,371,600 m³, 64.485% of the
System Input Volume and costs 12,539,085 yuan. It is composed of five components as
follows:
1) Unbilled Metered Consumption:7,135 m3
2) Unbilled Unmetered Consumption: 453,703m3
3) Unauthorized Consumption: 2,392,710m3
4) Customer Meter Inaccuracies and Data Handling Errors: 242,002m3
5) Reported Bursts: 242,002 m3
6) Unreported Bursts: 4,892,713 m3
6
7) Background Leakage: 183,337 m3
Picture 4.2: Column diagram of NRW component proportion
Picture 4.3: Pie diagram of NRW component proportion
c. Infrastructure Leakage Index (ILI) and its categories

14. In Baishan, the ILI is 29. And at the current operating pressure of 22m, the physical loss
value per service connection per day is 689 L/c/d. By comparison with the physical loss target
matrix in Table 3.5, it’s concluded that Baishan has qualified at Category D in developing
countries with high network leakage level. Leakage management is imperative to reduce NRW.
This situation indicates that horrendously inefficient use of resources, leakage reduction
programs imperative and high priority.
7
Picture 4.4: ILI value calculated
Table 4.2: Comparison matrix between ILI and physical losses (l/c/d)
Technical Physical Losses [liters/connection/day]

performance ILI (when the system is pressured) at an average pressure of:
category 10m 20m 30m 40m 50m
Develop A 1-2 <50 <75 <100 <125
ed B 2-4 50-100 75-150 100-200 125-250
Countri
C 4-8 100-200 150-300 200-400 250-500
es
D >8 >200 >300 >400 >500
Develop A 1-4 <50 <100 <150 <200 <250
ing B 4-8 50-100 100-200 150-300 200-400 250-500
Countri
C 8-16 100-200 200-400 300-600 400-800 500-1000
es
D >16 >200 >400 >600 >800 >1000
1) Category A: Good. Unless with extremely scarce water resources, further loss reduction may be
uneconomic and careful analysis needed to identify cost-effective improvements.
2) Category B—Potential for marked improvements. Consider pressure management, better active
leakage control, and better maintenance.
3) Category C—Poor. Tolerable only if water is plentiful and cheap, and even then intensify NRW
reduction efforts.
4) Category D—Bad. The utility is using resources inefficiently and NRW reduction programs are
imperative.
5. CONCLUSION AND SUGGESTION
5.1 Conclusion
6. It can be concluded from field test data analysis, water balance establishment and
leakage condition assessment in Baishan City:
1) Its NRW in 2012 is 10,371,600 m³, 64.485% of system input volume, and worth
12,539,085yuan. After assessment of Baishan’s water supply system leakage
condition, it can be discovered that physical losses and poor meter management are
the key factors of NRW.
8
2) Its apparent losses in 2012 are 2,846,413 m³, 17.697% of system input volume. And
ALI is calculated at 0.9966.
3) Its physical losses in 2012 are7,518,052 m³, 46.744% of system input volume.
Moreover, it can be known from estimation of physical losses components that
reported bursts take up15.183%, unreported losses 30.421% and background
losses 1.14%.
4) Baishan’s ILI is 29, the average pressure is 0.22 MPa, and the physical losses are
689 L/c·d. Compared with Target Matrix provided by World Bank Institute, Baishan’s
water supply network is Category D among developing countries, which means
serious leakage level. Its horrendously inefficient use of resources, leakage
reduction programs imperative and high priority.
5) Based on current condition investigation and data analysis, leakage reduction
consultant selected 29 performance indicators suitable for Baishan’s current
conditions from IWA Performance Indicator Handbook, and developed a series of
leakage reduction strategies and measures involving PIs as tools.
7. Although the apparent loss of Baishan is lower than the real loss based on the statistics
data, the condition of meter management is not optimal for the reasons that Baishan
has not established meter check and meter validation mechanism. May be the apparent
loss is higher than the result of water balance calculation from the objective view.
8. It is not necessary that Baishan water utility take more measures to reduce pressure of
systems. Firstly, Nanshan WTP as a main surface water plants, is located at higher
level, so the pressure of Nanshan is not higher than any other plain position WTP.
Secondly, the average pressure in Baishan reaches at 0.22 MPa, supplying with 4
floors building only. So the water network has not more redundancy pressure to be
lowered.
9. The water loss strategy team of Baishan water utility will serve as an effective focal
point for the implementation of its water loss reduction. It plays a key role of in
galvanizing the expertise of the other department who are involved in water network
management., such as operation and maintenance, national water control center,
SCADA, water planning, network development and GIS, field services, customer
services and corporate planning, to reduce water loss and enhance network
management efficiency.
5.2 Suggestions
a. Capacity building (inclusive of training and institution enhancement)
(1) Establish leakage reduction strategy team which comprises core staff from
Departments of Operation Control, Network Maintenance, Billing, Customer
Service, Auditing, Measurement, Finance and so on. First, undertake
comprehensive and systematic leakage control training, based on IWA’s water
leakage control principles, processes and methods. Second, according to
results of water balance and performance assessment, identify key loss
components and targets of leakage control, make corresponding enforcement
schemes, and draft annual plan and budget for leakage control. Finally, every
department devotes great efforts to fulfill performance assessment criteria of
leakage control, and enforce corresponding strategies. (With capacity
building expense CNY 50,000)
9
(2) Enhancement specialized leak detection group skills. Leak detection is an

active leakage control measure. At present, Baishan has one leak detection
group equipped with a set of relevant detection equipment. However, lack of
sufficient staffs and professional leak detection expertise, the detection
frequency remains one year when scanning the whole networks in Baishan. It
is advisable to expand leak detection group and equip more necessary leak
detection devices. In the first place, conduct strict leak detection trainings that
focus on field practice. External leak detection force can also be resorted to for
training and drill when necessary. Mentoring program helps group members
master leak detection technology. And these devices enable local leak
detection, leakage reduction and performance boost. (with capacity building
expense of CNY 50,000 and equipment purchase expense of 331,000)
(3) Baishan’s poor meter management is reflected in difficulty of estimating

apparent losses. From perspectives of management, reducing apparent losses
requires no extra input and can obtain obvious effectiveness. Specifically,
Baishan water utility should first establish a meter management department
staffed with specialized members. Second, carefully check current meters’
category, diameter distribution and whether they match flow or not, change the
present condition of using domestic meters continuously without any
calibration procedure once they installed, quantify and analyze apparent
losses, so as to increase metering accuracy. Most importantly, meter fraud and
water thief activities should be punished severely with the combined action
from local government and water utility.
b. Project Construction
(1) Installation 6 water meters in outlet of WTP for output volume measurement
accuracy (Cost of CNY 602,000)
• There are 3 water treatment plants (WTP) in Baishan city. One is
surface water plant named Nanshan WTP with capacity of 80,000 m3
per day, others are Zhenzhumen and Kuchangou groundwater WTP,
with output volume 9,000 and 5,000 m3 per day respectively.
• Lack of measurement facilities in all of outlet of WTPs, it is difficult to
assess the output volume of the whole systems. Current result of water
balance is based on some estimated data with limited confidence. The
unbelievable data should be eliminated immediately so as to gain
reliable information with support of ADB water supply project in
Baishan.
• 4 Electromagnetic meters, be selected in Nanshan water treatment
plant for its electricity and remote devices installation availability. 2
Bore-hole electromagnetic meters is suitable for Zhenzhumen and
Kucanggou groundwater plants for no electricity charge condition in
site.
(2) Flow meter installation and night flow monitoring in 3 DMAs
demonstration(Cost of CNY 110,000)
• Select 3 DMAs in Baishan water supply network to conduct leakage
monitoring and analysis which can be taken as the basis of leakage
monitoring and reduction of the whole network. Install measuring
equipments on DMAs’ boundaries to record pressure, flow and other
data in different area networks. Thus water utility is able to monitor the
whole network for long term, acquire the micrographic distribution of
10
leakages and balance the network service pressure to reduce leakage.

Establishing DMAs as a strategy of leakage management enables the
water utility to evaluate the area leakage condition, to compare leakage
of different areas, and to find out areas with high leakage for active leak
detection.
• Analyses of long-term monitoring data of DMAs help water utility to
understand the flow variation against time. For example, when burst
happens in a DMA, flow changes sharply and even the area pressure
drops considerably. Based on the monitoring data, the utility managers
can find out areas with abrupt variation of pressure and flow, and
analyze the flow rates to locate leakages in short time. Especially in
case of bursts, the monitoring data can facilitate utility managers to
identify the location quickly for timely repair which would diminish
volume of lost water and other losses. In conclusion, monitoring DMA is
vital for network management because through the monitoring system,
pressure and flow of the whole network can be explicitly reflected,
bursts can be quickly located and it can provide data for network
modeling.
• It is to be noted that ADB cannot fund all DMA monitoring. However,
ADB will provide technological support or demonstration areas in terms
of IWA philosophy of water loss reduction, and conduct comprehensive
analysis to make sure network operates better and functions properly.
In this way, objectives of the demonstration project can be fulfilled.
• Choose residential quarters, as required, with commercial and industrial
customers as few as possible, aged network, frequent leakages,
individual inflow mains, and bulk meters installed at inlets.
• 3 DMA named Xingtai garden(including 1017 household), Baihe
(including 1248 household )and Yangguang community(including 1098
household) are chose as demonstration areas for monitoring customer
demand against pressure. Meanwhile, data from the DMA meters are
transmitted to central operation department by remote devices.
5.3 Anticipated accomplishments of the leakage reduction project

1) Make rational use of urban water resources with moderate or none consumption
increase, and realize sustained development.
2) In contrast to current ALR period, Leak detection period of the urban water supply
network, and time taken to attend bursts or leaks after the first notification be shorted
significantly in the future.
3) During implementing ADB project, water utility should perform water balance
calculation and leakage reduction PI assessment annually. The NRW at the end of
the project will be decreased by 30%, standing at 35% compared with current high
level 65%.
4) Be capable of analyzing and comparing night flow data in DMAs to prioritize leak
detection strategy.
5) The popularity rate for water supply is 70% in 2012. The figure is expected to reach
90% by the end of ADB project period.
6) Undertake and realize an annual optimistic estimation of investments saved by
implementation ADB water loss control project.
11
Table 5.1: The next plan proposed for Baishan loss control
Performance Targets
Data Sources and
and Assumptions and
Summary Reporting
Indicators with Risks
Mechanisms
Baselines
By 2016: Assumption
Impact
Non revenue water The Baishan
Increased access of local
management government will
the urban statistical reports
Improved near improve its water
residents to safe and Baishan Water
domestic average level. resources
water supply in Supply Company’s
Non revenue water management and
Baishan. Intermittent annual reports
reduced to supervised strongly
supply is not happened.
35% with NRW.
By 2014:
Outcome Non revenue water
Reports by the Risk
Reduced non revenue management
Baishan Water Measure meters in
water in Baishan improved
Supply Company’s WTP are not
water supply Non revenue water
records installation completely.
system reduced to
55% from current 65%
Outputs
1. A survey report and
By 2013:
water balance chart on
final report submitted to Site inspection and
nonrevenue water Assumption
ADB collection,
produced Participation and
Non revenue water Government’s
2. Non revenue water strong support of the
recommendation various FSR and other
Reduction measures PMO and local water
incorporated in documents
proposed Supply Company
the ensuing loan project
3. Awareness on
Non revenue water
Management increased
12
Table 5.2 Expenses of capacity building, project construction and equipment

purchase
Equipment Construct. Others
Sub-total
No Item Equipment Qty expense expense CNY Note
(CNY)
CNY CNY
3 days
Capacity
1 50,000 workshop of
building
NRW reduction
3asys
2 50,000 workshop of
leak detection
100,000
Electronic
Equipment
3 leak 1 78,000
purchase
detector
Pipe
4 1 67,000
locator
Soundsens
5 correlator 1 180,000
Listening 3,000*2=6,0
6 2
pod 00
331,000
Using for
Project
Nanshan WTP
constructio DN800
measurement,
7 n 1 (meter Electromag 1 74,000 38,000 10,000 122,000
installation including
netic meter
electricity and
remote devices
Using for
Nanshan WTP
DN400
measurement,
8 Electromag 1 44,000 38,000 10,000 92,000
including
netic meter
electricity and
remote devices
Using for
Nanshan WTP
DN300 2*10,00
2*36,000=72 2*38,000= measurement,
9 Electromag 2 0=20,00 168,000
,000 76,000 including
netic meter 0
electricity and
remote devices
Using for
Zhenzhumen
DN400 WTP
bore-hole measurement,
10 1 74,000 38,000 0 112,000
Electromag including
netic meter pressure
recording and
remote devices
Using for
Kucanggou
DN300 WTP
bore-hole measurement,
11 1 7,000 38,000 0 108,000
Electromag including
netic meter pressure
recording and
remote devices
13
Installation at
Project Xingtai garden
constructio (1017
n2 DN200 households)an
2*40,000=80
12 remote 2 0 0 80,000 d Baihe
DMA ,000
meter
manageme community 1
nt 248
households
Installation at
DN150 Yangguang
13 remote 1 30,000 0 0 30,000 community 1
meter 098
households
Total 1,143,000
14
Financial Analysis
Project Number: 46048 / TA 8172 - PRC
Jilin Urban Development Project

Jilin Urban Development Project (TA 8172-PRC) Final Report
FINANCIAL ANALYSIS
I. FINANCIAL ANALYSIS OF REVENUE GENERATING SUBCOMPONENT
A. Introduction
1. The financial analysis will cover 4 components in Baishan and Baicheng Cities of Jilin
Province, the People’s Republic of China (PRC) including integrated solid waste management
(ISWM) in Baishan; Improved water supply system in Baishan; improved urban road network and
improved municipal services in Baicheng, and institution and capacity strengthening. Financial
analysis of the Project and its components is carried out in accordance with Asian Development
Bank’s (ADB) Financial Management and Analysis of Projects 1 as well as Guidelines for Financial
Governance and Management of Investment Projects Financed by the ADB 2, and other relevant
publications.
2. Financial internal rate of return (FIRR) is estimated for revenue generating subprojects, i.e.,
the new water supply system in Baishan including a new water treatment plant with daily treatment
capacity of 50,000 tons and water transmission and supply networks. Cost streams used for the
purpose of the financial internal rate of return (FIRR) determination include capital investment and
operations and maintenance. The weighted average cost of capital (WACC) based on each
subcomponent funding assumptions are compared with the FIRR to ascertain the financial viability.
3. Finally, the affordability of water tariff directly from end users is assessed by determining
the percentage of household income to meet the estimated yearly bill from piped water supply and
water services. Financial projections over 20 years excluding construction period are prepared to
ensure that cumulative cash flow will meet cash operating costs, debt service, and replacement of
short-lived fixed assets at prevailing tariffs. Required financial ratios, such as, debt service
coverage ratio” would be no less than 1.2 and recommended as part of loan covenants and
assurances.
B. Financial Assumptions
4. The following are the general assumptions:
• All costs are expressed in July 2013 prices.

• The Project is analysed over a 20-year period excluding construction period, and the
residual value is not considered.
• Demand projections are adopted in the FSR.
• Foreign exchange rate of CNY6.08 per US$1.00 is used when converting foreign
exchange costs to their local currency equivalent, as the average level from 2014 to
2019.
• Operation and maintenance costs include personnel salaries and welfare, plant
maintenance costs, administration, insurance, taxes, power cost, and other
expenses.
• Capital cost includes the base cost of the revenue generating subcomponent,
including the investment cost for the associated water supply network pipelines, and
1
ADB. 2005. Financial Management and Analysis of Projects. Manila.
2
App 5 - 1
physical contingencies but excludes price contingencies and financial charges

during development (as a result of debt financing).
• The revenues from the revenue-generating component will be derived from the
water sales.
• Net cash flows from the component were determined after income taxes. Income
tax was calculated at 25% and sale tax at 6%.
• Expenses also include depreciation at 4% of net fixed assets. For the interest during
construction, 5-year swap rate is used (adding maturity premium and plus ADB
margin of 0.4%, maturity premium of 0.1%); for projection of debt service, 20-year
swap rate is used and a 20-year repayment period for the ordinary capital resources
(OCR) loan.
• Interest during construction is capitalized. Amortization period remains 25 years
including 5-year grace period. Repayment is assumed to be in straightline method
starting in 2020.
• Technical data and costs were obtained from the revised project feasibility study
report (FSR) to form the basis of the financial analysis and FIRR.
C. Calculation of the Weighted Average Cost of Capital (WACC) And Financial Internal
Rate of Return (FIRR)
5. To compute the WACC, it is assumed that the financing sources would consist of both
project cities’ equity contributions and ADB foreign currency loan. The Ministry of Finance would
re-lend the funds from ADB with the same duration, 25 years with a five-year grace period. The
loan rate would be London interbank offered rate (LIBOR) plus ADB margin (of 0.50%) and
maturity premium of 0.2%. The cost of equity is calculated at 7.00%, assuming a risk free rate of
return of 6.0% plus a 1.0% margin. Income tax is assumed at 25%, with the WACC calculated on
an after tax basis. The other assumptions are domestic inflation rate of 3.0% and international
inflation rate of 1.90%. As shown in Table A5-1, the real WACC for the subcomponent is 2.58%.
Table A5-1: Weighted Average Cost of Capital
A. Financial component ADB Government Domestic Loan Equity Total

B. Amount (CNY million) 210.00 233.95 0.00 0.00 443.95
C. Weighting 47.3% 52.7% 0.0% 0.0% 100.0%
D. Nominal cost 4.18% 7.00% 6.30%
E. Income tax rate (preferential tax rate) 25% 15%
F. Tax-adjusted nominal cost [D x (1 - E)] 3.14% 7.00% 5.36% 0.00%
G. Inflation rate 1.90% 3.08% 3.1%
H. Real cost [(1+F) / (1+G) - 1] 1.21% 3.80% 2.20% 0.00%
I. Weighted component of WACC 0.6% 2.00% 0.00% 0.00%
Weighted average cost of capital 2.58%
ADB= Asian Development Bank; WACC = Weighted Average Cost of Capital

Source: TA Consultant’s estimates.
6. Water conservation is one of the top priorities in the sectoral agenda of the government of
China. To accelerate the tariff reform in water supply, in the Guidance that the NDRC and Ministry
of Housing and Urban-Rural Development recently issued (NDRC (2013)-2676), it is required that
App 5 - 2
by the end of 2015, cities authorities shall apply the tiered water pricing system on all urban
residents; towns’ authorities shall actively promote the implementation of the system if conditions
allow. 3 Increasing block tariffs (IBTs) appears to be a popular tariff structure in many developing
countries. In a survey of urban water utilities in Asia, ADB (1993) 4 found that the majority of utilities
in their samples (20 out of 32) used an IBT structure.
7. In the Guideline, at least three tiers should be set up. The first tier shall in principle be
identified according to the water volume covering 80 percent of local households’ monthly average
water consumptions to satisfy the basic water use requirement in residents’ lives; The second tier
shall in principle be identified according to the water volume covering 95% percent of local
households’ monthly average water consumptions to reflect the reasonable water use requirement
to improve residents’ life quality; The third tier shall be identified as the water volume exceed the
second tier. The Guideline also specifies that for Jilin province, the first tier is from 0 to 2.4
tons/capita/month, and the second tier ranges from 2.4/t/c/m to 4.1t/c/m, and the third tier
corresponds to 4.1t/c/m and upward.
8. According to the Urban Water Supply Tariff Management Guidelines issued in 2004, the
price ratios of the three tiers are set at 1:1.5:2. Thus preserving the current uniform residential
water tariff at CNY2.30/t at the first tier, the prices for the second and third tiers are therefore
CNY3.45/t and CNY4.60/t respectively.
Figure. Proposed Increasing Block Tariff (IBT) for Water Supply in Jilin
9. Given the aforementioned water tariff assumption, and assume that leakage ratio for the
newly constructed distribution network is 15%, and the plant operates at its full capacity, the
financial internal rate of return for Baishan water supply component is calculated at 6.64%, which is
higher than the WACC at 2.42%. At 10% discount rate, the net present value is negative
3
The increasing block tariffs (IBTs) or tiered water pricing is based on the volumetric component. In this tariff
structure, water use per billing period is divided into a number of discrete blocks for which separate prices
apply.
4
Asian Development Bank, 1993. Water Utilities Handbook: Asian and Pacific Region. Manila, Philippines.
App 5 - 3
CNY235.86 million. The detailed computation of the FIRR is shown in Table A5-3.
10. The results of sensitivity analysis are shown in Table A5-2. The project is most sensitive to
benefit reduction of which FIRR falls to 4.46% if the capital cost overrun by 5%. The sensitivity
analysis shows that the FIRR of the water supply subproject is robust against negative impacts.
Table A5-2 FIRR and Sensitivity Analyses
Cases FIRR NPV(CNY million)

Base Case 5.82% 155.4
(i) Revenues reduction 5% 4.46% 79.5
(ii) Investment cost overrun 5% 4.74% 97.0
(iii) O&M Cost Increase 10% 5.03% 105.8
(iv) Delay in Implementation one year 5.20% 114.0
(v) Combination of (i), (ii), and (iii) 3.83% 54.4
App 5 - 4
Table A5-3: Detailed Computation Financial Internal Rate of Return

Capital Costs O&M Adjusted Net Sales Net Cash
Year Income Tax Flow
2014 7.40 0.00 0.00 0.00 (7.40)
2015 55.47 0.00 0.00 0.00 (55.47)
2016 110.94 0.00 0.00 0.00 (110.94)
2017 166.40 0.00 0.00 0.00 (166.40)
2018 29.58 0.00 0.00 0.00 (29.58)
2019 0.00 11.39 4.86 45.77 29.52
2020 0.00 12.10 3.98 45.77 29.69
2021 0.00 12.10 3.98 45.77 29.69
2022 0.00 12.10 3.98 45.77 29.69
2023 0.00 12.10 3.98 45.77 29.69
2024 0.00 12.10 3.98 45.77 29.69
2025 0.00 12.10 4.35 47.27 30.82
2026 0.00 12.10 4.35 47.27 30.82
2027 0.00 12.10 4.35 47.27 30.82
2028 0.00 12.10 4.35 47.27 30.82
2029 0.00 12.10 4.35 47.27 30.82
2030 0.00 12.10 6.58 56.17 37.49
2031 0.00 12.10 6.58 56.17 37.49
2032 0.00 12.10 6.58 56.17 37.49
2033 0.00 12.10 6.58 56.17 37.49
2034 0.00 12.10 6.58 56.17 37.49
2035 0.00 12.10 7.09 58.21 39.02
2036 0.00 12.10 7.09 58.21 39.02
2037 0.00 12.10 7.09 58.21 39.02
2038 0.00 12.10 7.09 58.21 117.36
WACC 2.58% NPV= 155.44
5.82%
Note: FIRR = Financial Internal Rate of Return; NPV = Net Present Value
Source: TA Consultant’s estimates.
App 5 - 5
Guangdong Chaonan Water Resources Development and Appendix 5
Protection Demonstration Project (TA 8112-PRC) Draft Final Report
D. Affordability
11. In accordance with PRC government policy all local governments are expected to charge
reasonable fees for water supply. Water tariffs for end users are established based on the cost of
operating the facilities and the affordability of consumers. In case profitability is not possible, local
governments are encouraged to set a minimum price that can cover O&M costs.
12. According to the Urban Water Supply Tariff Management Guidelines issued in 2004, the
price ratios of the three tiers are set at 1:1.5:2. Assume that to maintain the current uniform
residential water tariff at CNY2.30/t at the first tier, the prices for the second and third tiers are
therefore CNY3.45/t and CNY4.60/t respectively. Since Increasing Block Tariff is rare in China for
water consumption, there is few existing studies quantifying the impact of IBT on water
consumption. Thus assume that the introduction of IBT will make the household consumption of
water and urban comprehensive per capita water consumption to decrease from 210l/d/c to
140l/d/c.
13. Based on generally accepted criteria employed by the World Bank, the water Tariff is
affordable where it does not exceed 5% of annual household incomes for water consumption.
Estimates were made of annual water bill for low income and average household based on
household size. The annual water bill is below 3% of the average household income for consuming
120 liters/capita/day (lpcd), while low income households consuming 90 lpcd are paying below 5%
of their annual household income since 2019. Based on the analysis summarized in Table A5-8,
low income households will have not a problem with affordability of the above proposed water tariff
increase since the share of income expended on water is below the benchmark of 5% of
household income annual.
Table A5-5: Affordability Analysis
Items 2019 2020 2021 2022 2025 2030 2035
Domestic Tariff (CNY/m3) 2.80 2.80 2.80 2.80 2.80 3.20 3.20
Average Income HH 35293 38116 41165 44459 56005 82290 120911
Water bill CNY/year 164 164 164 164 164 187 187
Affordability (% HH Income)
– Water 0.46% 0.43% 0.40% 0.37% 0.29% 0.23% 0.15%
Low Income HH 2516 2717 2934 3169 3992 5866 8619

Water bill CNY/annual a 92 92 92 92 92 105 105
Affordability (% HH Income)
– Water 3.66% 3.39% 3.13% 2.90% 2.30% 1.79% 1.22%
3
Note: HH = Household; m = cubic meter.
a
consumption of 90 lpcd for low income household and 120 lpcd for the average income household.
Source: Income data from PMO.
App 5 - 6
FINANCIAL SUSTAINABILITY ANALYSIS FOR NON-REVENUE GENERATING
Introduction
1. Financial sustainability analysis has been prepared in accordance with Asian

Development Bank (ADB) Guidelines for the Financial Management and Analysis of Projects. 5 An
assessment of financial performance has been completed for the BSMG and BCMG. The
objectives of this report are to:
(i) Review the past revenue generation capacity of BSMG/BCMG and the share of
revenues from upper level government namely Municipal and State sources over the
period 2007 to 2012, and the level of expenditure that this supports;
(ii) Based on the revenue generating capacity of BSMG/BCMG in the past assess the
financial capacity of providing in total counterpart funding over 2013 to 2017 from
BSMG/BCMG;
(iii) Assess the governmental ability to meet debt service on the ADB loans and the O&M
for the three non-revenue generation components.
2. Based on generally accepted criteria employed by the World Bank, the counterpart
contributions are considered to be affordable by the city if the required annual counterpart
contribution does not exceed approximately 15-20% of the projected total annual construction
budget. However, it is not possible to identify the construction or investment sub-component of the
city budget as reporting is by sector and includes both recurrent and investment expenditure under
the same heading. Therefore the annual contribution is compared with overall annual city
expenditure and also as a share of special infrastructure projects, which are municipal or State
sponsored projects financed by upper level government. It could be argued that the current project
is a special infrastructure project.
3. In the case of debt service there is no accepted criteria of the level of debt service that
would be regarded as affordable, but where contributions exceed some 2.5% of city local revenue
base or 1.0% of total city revenues or expenditures then the debt service may be a cause for
concern and crowd out other programs, especially those targeted to the poor.
A. Historical Revenues and Expenditures
4. The historical financial performance of BSMG/BCMG is analyzed to determine whether it

can provide the required counterpart funds during the construction period and necessary funds for
O&M and debt service during the operating period. In addition, annual average growth rates
(AAGR) of revenues and expenditures during the project period are calculated. The average
income growth rate is 16% per year. The same growth rates are used in projecting the revenues of
BSMG/BCMG during the implementation of the Project. The sources of income are from tax (VAT,
business tax, income tax, resource tax, real property tax) and non-tax revenues and from subsidies
and/or direct transfers from the municipal and the regional governments. On the other hand,
expenditures are categorized into general public services, education, public safety, personnel
welfare, environmental protection, agriculture, forestry and water and transportation. Table A5-6
shows that the revenue of BSMG has grown at an average rate of 25% over the last six years to
CNY5229.9 million in 2012 from CNY1377.3 million in 2007. Over the same period, expenditures
have grown at 22% per annum. The revenue of BCMG has grown at an average of 25% over the
past six years, reflected in Table A5-7.
5
App 5 - 7
Table A5-6: Revenues and Expenditures

For BSMG (2007-2012)
Item 2007 2008 2009 2010 2011 2012 Growth Rate
Revenues (CNY, million)

Municipality Fiscal
1377.26 1930.3 3133.03 4073.59 4324.99 5,229.90 25%
Revenues
1. General Budget
1,096.70 1,558.68 1,977.69 2,527.08 3,553.08 4,363.04 26%
Revenue
2.Funds Revenues 280.56 371.62 1,155.34 1,546.51 771.91 866.86 21%
Provincial transfers 133.13 191.79 213.90 225.29 284.79 328.50 15%

Central Government
860.82 1,261.53 1,445.76 1,572.28 1,960.99 2,029.56 19%
Transfers
Total 2,371.21 3,383.62 4,792.69 5,871.16 6,570.77 7,587.96 21%
Expenditures (CNY
million)
General Public Service 777.66 945.76 1,164.50 1,330.63 1,469.72 1,328.43 9%
Public Safety 257.63 338.05 438.05 548.02 589.40 788.87 21%
Education 716.65 890.03 1,147.94 1,171.97 1,481.97 2,420.13 22%
Science and Technology 20.93 30.35 27.87 52.11 48.99 69.51 18%
Social Insurance and
1,005.93 1,364.39 1,995.20 1,966.25 2,229.18 2,313.26 15%
Employment
Medical and Sanitation 211.20 294.29 532.14 764.70 913.44 937.07 28%
Environmental Protection 57.75 137.06 214.40 562.51 959.87 708.35 52%

Agriculture, Forestry and
401.23 531.10 736.57 988.04 1,232.01 1,358.44 23%
Water Affairs
Transportation 128.30 170.41 221.07 510.54 673.65 550.55 27%
Others 108.56 101.77 163.88 1,246.53 2,045.16 2,314.33 56%
Total 4,531.10 6,330.96 9,005.81 11,911.34 13,927.93 15,199.33 22%
Surplus -2,159.8 -2,947.34 -4,213.12 -6,040.18 -7,357.16 -7,611.37

AAGR – annual average growth rate.
Source: Baishan Finance Bureau.
App 5 - 8
Table A5-7: Revenues and Expenditures

For BCMG (2007-2012)
Annual
Item 2007 2008 2009 2010 2011 2012 Averag
Municipality Fiscal Revenues 832.45 1090.65 1263.46 1801.31 2457.26 3102.87 25%
1. General Budget Revenue 832.45 1090.65 1263.46 1801.31 2457.26 3102.87 25%
2.Out-budget Revenues 0%
Upper Level Government
Allocations 960.81 1222.4 1057.37 1480.12 1792.44 1758.48 11%
Total 1796.90 2313.05 2320.83 3281.43 4249.70 4861.35 18%
Expenditures (CNY million)
General Public Service 523.05 635.58 687.03 830.08 980.96 1,007.63 12%
Public Safety 282.97 344.56 424.88 496.59 518.93 633.50 14%
Education 984.86 1,165.68 1,333.29 1,465.18 1,785.92 2,935.02 20%
Science and Technology 44.45 38.32 42.42 46.85 53.68 61.33 6%
Culture P.E. 78.28 85.12 111.64 152.84 142.85 155.64 12%
Social Insurance and Employment 1,003.47 1,205.80 1,888.60 1,672.59 2,004.11 2,036.86 13%
Medical and Sanitation 313.31 407.70 680.78 788.76 1085.42 1128.46 24%
Environmental Protection 65.12 245.13 295.27 483.86 503.45 608.88 45%
Urban and rural affairs 215.92 419.16 305.40 439.38 555.95 735.46 23%
Agriculture, Forestry and Water
Affairs 791.76 1073.92 1741.88 1627.96 1862.91 2387.74 20%
Transportation 145.95 158.74 223.33 255.42 394.99 475.50 22%
Gov’t fund spendings 431.49 468.59 397.23 659.84 1009.15 1450.47 22%
Transferred to Upper Level
Government
Total 4,880.6 6,248.3 8,131.8 8,919.4 10,898.3 13,616.5 19%
Surplus -3,083.7 -3,935.3 -5,810.9 -5,637.9 -6,648.6 -8,755.1

Source: Baishan Finance Bureau.
App 5 - 9
B. Fiscal Affordability Assessment
5. The average annual growth rates derived above are utilized to forecast the government
revenues and expenditures for the coming years. Assume the fiscal revenue of BSMG will continue
to grow at the pace of the past 6 years’ average. The financial sustainability analysis involves
comparing the estimated counterpart funds with the government revenues during the
implementation period, and comparing the necessary supporting funds disbursed annually,
including the O&M for two non-revenue generating components, and debt service with the
government revenues during the operating period.
6. BSMG will provide about CNY138.8 million counterpart funds during implementation. The
annual counterpart funds comprise 0.08% to 0.61% of projected revenues during the
implementation period. On the other hand, the O&M for the non-revenue generating component,
and the debt service are about 0.01% to 0.02% of annual projected revenues till 2030, and
represents reasonable proportion of the government expenditures at the operating period. The
analysis indicates that the Project should have sufficient funds available for counterpart funds
during implementation and O&M costs for non-generating components and debt service during
operation. This indicates acceptable fiscal risk since it is expected that fiscal revenues of the local
government will grow in line with economic development, providing more resource mobility for the
government to finance the proposed project components. The detailed fiscal impact analysis of the
provision of counterpart funds, debt service and operating and maintenance to the proposed
subcomponents is shown in Table A5-8.
7. Likewise, assume the fiscal revenue of BCMG will continue to grow at the pace of the past
6 years’ average. BCMG will provide about CNY1142.7 million counterpart funds during
implementation. The annual counterpart funds comprise 0.72% to 3.18% of projected revenues
during the implementation period. On the other hand, the O&M for the non-revenue generating
component, and the debt service are about 0.03% to 0.23% of annual projected revenues till 2030,
and represents reasonable proportion of the government expenditures at the operating period. The
analysis indicates that the Project should have sufficient funds available for counterpart funds
during implementation and O&M costs for non-generating components and debt service during
operation. This indicates acceptable fiscal risk since it is expected that fiscal revenues of the local
government will grow in line with economic development, providing more resource mobility for the
government to finance the proposed project components. The detailed fiscal impact analysis of the
provision of counterpart funds, debt service and operating and maintenance to the proposed
subcomponents is shown in Table A5-9.
8.
App 5 - 10
Table A5-8 BSMG Fiscal Affordability Assessment
Item 2014 2015 2016 2017 2018 2019 2020 2024 2025 2030
Municipality Fiscal
Revenues 8159.29 10191.3 12729.5 15899.7 19859.6 24805.6 30983.4 75413.36 94195.0 286368.8
1. General Budget Revenue 6859.92 8635.14 10869.7 13682.6 17223.4 21680.5 27291.0 68520.61 86252.4 272597.9
2.Funds Revenues
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Provincial transfers 1306.72 1577.02 1903.23 2296.91 2772.03 3345.43 4037.44 8564.88 10336.5 26463.3
Central Government
Transfers 3401.47 3928.24 4536.59 5239.16 6050.52 6987.55 8069.68 14354.34 16577.3 34054.4
Total 11568.10 14140.3 17309.6 21218.7 26045.9 32013.5 39398.1 91439.83 113166.3 333115.7
General Public Service

1777 2174 2660 3255 3982 4872 5961 13358 16343 44808
Public Safety 1163 1423 1741 2130 2606 3189 3901 8743 10697 29327
Education
3627 4437 5429 6643 8127 9944 12166 27262 33356 91451
Science and Technology 104 127 156 190 233 285 348 781 955 2619
Cultural PE
267 327 400 489 598 732 896 2007 2456 6733
Employment 3463 4237 5184 6342 7760 9494 11616 26030 31847 87315
Medical and Sanitation 1403 1716 2100 2569 3143 3846 4705 10544 12901 35370
Environmental Protection
1060 1297 1587 1942 2376 2907 3557 7971 9752 26737
Urban and rural affairs 1361 1665 2037 2492 3049 3731 4565 10229 12515 34312
Water Affairs 2034 2488 3044 3724 4557 5575 6821 15286 18702 51275
Transportation 824 1008 1234 1509 1847 2260 2765 6195 7580 20781
Industrial and financial affairs
189 232 283 347 424 519 635 1423 1741 4774
Others
2178 2665 3261 3989 4881 5972 7306 16373 20032 54921
Transfer to upper govt 0 0 0 0 0 0 0 0 0 0
Govt fund spending
1781 2180 2667 3263 3992 4884 5976 13391 16383 44918
Total 19450 23797 29115 35623 43584 53325 65243 146201 178876 490422
Surplus
(7882) (9656) (11806) (14404) (17538) (21312) (25845) (54761) (65710) (157307)
Annual counterpart funds
(CNY million) 16.42 67.49 106.35 112.48 42.94 25.32
Counterpart funds as a % of
revenues 0.14% 0.48% 0.61% 0.53% 0.16% 0.08%
Annual debt service, and
O&M for non-generating 7.1 7.1 7.1 7.1
Annual debt service, subsidy
and O&M for non-generating 0.02% 0.01% 0.01% 0.00%
Table A5-9 BCMG Fiscal Affordability Assessment
App 5 - 11
Item 2014 2015 2016 2017 2018 2019 2020 2024 2025 2030
Municipality Fiscal
Revenues 4810.96 5990.54 7459.34 9288.27 11565.6 14401.3 17932.3 43109.64 53679.5 160686.6
1. General Budget Revenue
4810.96 5990.54 7459.34 9288.27 11565.6 14401.3 17932.3 43109.64 53679.5 160686.6
2.Funds Revenues 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Provincial transfers
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Central Government
Transfers 2421.71 2678.38 2962.25 3276.21 3623.44 4007.4 4432.22 6631.6 7334.52 12137.2
Total
7232.67 8668.92 10421.5 12564.4 15189.0 18408.8 22364.5 49741.2 61014.0 172823.9
General Public Service

1333.60 1582.31 1877.39 2227.51 2642.93 3135.81 3720.62 7373.51 8748.62 20571.39
Public Safety
859.70 1020.02 1210.25 1435.95 1703.75 2021.48 2398.47 4753.29 5639.75 13261.23
11654.8
Education 4177.49 4956.56 5880.92 6977.66 8278.94 9822.90 23097.46 27404.95 64439.69
0
Science and Technology
76.78 91.10 108.09 128.24 152.16 180.54 214.20 424.51 503.68 1184.34
Cultural PE 207.08 207.08 245.69 291.52 345.88 410.38 486.92 964.97 1144.93 2692.18
Employment 2867.42 3402.17 4036.65 4789.45 5682.64 6742.41 7999.82 15854.03 18810.69 44231.23
Medical and Sanitation
1588.61 1884.87 2236.38 2653.45 3148.30 3735.43 4432.06 8783.44 10421.49 24504.96
Environmental Protection 857.16 1017.01 1206.68 1431.71 1698.72 2015.51 2391.39 4739.26 5623.09 13222.07
Urban and rural affairs
Water Affairs 3361.37 3988.24 4732.02 5614.50 6661.57 7903.90 9377.91 18585.13 22051.11 51850.73
Transportation
669.39 794.23 942.35 1118.09 1326.60 1574.00 1867.54 3701.09 4391.31 10325.67
others 2041.92 2422.72 2874.54 3410.62 4046.67 4801.35 5696.76 11289.83 13395.29 31497.54
Transfer to upper govt
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Total
18040.51 21366.3 25350.9 30078.7 35688.1 42343.7 50240.4 99566.52 118134.9 277781.0
- - - - - - - - - -
Surplus
10807.84 12697.3 14929.3 17514.2 20499.0 23934.8 27875.9 49825.23 57120.86 104957.1
Annual counterpart funds
(CNY million) 51.75 212.54 331.85 346.99 127.54 71.98
Counterpart funds as a % of
revenues 0.72 2.45 3.18 2.76 0.84 0.39
Annual debt service, and
O&M for non-generating 50.71 50.71 50.71 50.71
Annual debt service, subsidy
and O&M for non-generating
subprojects as % of
revenues 0.23 0.10 0.08 0.03
App 5 - 12
Economic Analysis

February 2014

ECONOMIC ANALYSIS
A. Introduction
1. The central government of PRC is accelerating the development of small- and medium-
sized cities. Small and medium-sized cities contributed to 56.22 percent of the country's overall
economy last year, with a combined GDP of CNY 26.51 trillion. China’s urbanization rate
reaches 52.57% by the end of 2012, measured by the urban population, up 1.3% from a year
earlier1. Urbanization is thought a key for China’s modernization. By clustering the production
and innovation capacities in the cities, economies of scale can achieve. However, incomplete
urbanization will not only impede its growth, but also become a source of widened income
inequality and consequent social tension and instability. Adequate infrastructure would help to
mitigate the negative impact of rapid urbanization in medium-sized cities. This is because
adequate infrastructure will ensure that local or migrant workers can get easier access to better
public transportation system, sanitation water supply, public services, affordable housing and
education as urban residents. These benefits can eventually yield better employment
opportunities for the vulnerable groups at a lower cost.
2. The outer economic circle of Jilin Province includes four regions: Yanbian, Baishan,
Tonghua, and Baicheng. This is an open circle, which includes the eastern and western Jilin
Province. The middle one includes Jilin, Liaoyuan, Siping, and Songyuan. The inner one is
comprised of Changchun, which includes Gongzhuling, Yitong, Nong’an, Jiutai, and Dehui. The
proposed project will extend the investment to address urban development in Baishan and
Baicheng Cities’ two prefecture capitals located at the remote southeast and northwest regions
of Jilin Province.
3. Baicheng municipality was established in 1993 and gained rapid economic growth. The
GDP grew from CNY3.428 billion in 1993 to CNY 61.54 billion in 2012, or 17.8 times of that in
1993. Capital investment grew from CNY1.1 billion to CNY46.7 billion, or a 43 times increase.
Fiscal revenue increased from 0.25 billion to CNY4.86 billion in the same period of time. At the
same time, infrastructure developed considerably, e.g., a total of 418 km of urban roads were
constructed, and over 40 km of sewer pipeline networks were either newly built or renovated,
while the sewage treatment ratio increased from 26.4% to over 60%. By the end of 2012,
urban residents’ per capita disposable income reached CNY 19500, a 10.2 times increase of
1993 level. Rural residents’ net income reached CNY6200, or 7.9 times of 1993 level.
4. In the most recent 5 years, Baicheng’s annual GDP growth rate sat at 19%, and the net
growth ranked the first in Jilin for two consecutive years. Per capita GDP reaches CNY26100,
or 2.8 times of the value in 2006. Annual total fiscal revenue growth was 22%. The city
implemented 726 projects with single project investment value over CNY30 million. Foreign
capital utilization reached CNY124.7 billion in the past 5 years, or 4 times of the previous 5 year
span.
5. The city of Baishan experienced similar growth pattern. In 2012, total GDP of Baishan
was CNY60.06 billion, or 12.4% growth at constant price. Per capita GDP was CNY46853.
Total budgetary fiscal revenue was CNY6.72 billion, an increase of 15.9%. Foreign direct
investment continued at a fast pace, with US$178.6 million, an increase of 16.3%. In 2012, per
capita disposable income for the urban residents was CNY21282, an increase of 15.1%.
6. However, both cities are growing and face urgent needs for investments on their
infrastructures. The proposed project will deal with the demand for solid waste management in
both cities, urban road networks in the new area in Baicheng, and water supply in Baishan. The
methodology, baseline assumptions, analysis, and results of the FSR were reviewed.
1
This rate was 39.09% in 2002.
S App 7 - 1
B. Justification
7. The total MSW amount increased from 31.3 million tons in 1980 to 164 million tons in
2011. Currently, waste composition in China is dominated by a high organic and moisture
content, since the concentration of kitchen waste in urban solid waste makes up the highest
proportion (at approximately 60%) of the waste stream. According to China Statistical Yearbook
series, the total amount of MSW collected and transported was 164 million tons in 2011, of
which 80% was treated and 76.9% of the treated SW was landfilled, 19.9% was incinerated and
3.3% in other category.
8. Currently, there are about 660 cities in China that produce about 160 million tons of
municipal solid waste annually and, account for 28% of the world’s MSW each year. In 2004,
China surpassed the United States as the world’s largest waste generator. China’s per capita
waste generation rate is 0.5 to 1.0 kg/ capita/day, while a typical developed country generates
1.43 to 2.08 kg/capita/day. The MSW generation rate also varies among different cities in
China, e. g., with rates of about 1.00 kg/capita/day in Beijing in 2011, 0.92 kg/capita/day in
Shanghai, 0.85 kg/capita/day in Jilin’s urban areas, and only 0.41 kg/capita/day in Jiangxi’s
cities.
9. For residential areas, there are two type of urban solid waste collection: collection at
roadsides and household collection. Road- side waste collection is a method whereby residents
sort recyclable items into the specific collection containers offered by the local authorities. With
fast urbanization, high- rise buildings are appearing in large numbers. Now residents are
advised to place their waste in bags and deposit their garbage in the appointed garbage bins
outside the residents’ house for collection under the new system, and then the waste is
transported by truck to a transfer station. This system is usually carried out by a community or
business entity in China.
10. There are several main problems in China’s MSW management. First, China’s overall
MSW collection includes both formal and informal waste collection which is composed by
freelance garbage collectors who retrieve valuables from the waste, and indeed, there are twice
as many people in the informal sector as those in the formal sector. Unfortunately, these
informal waste collection systems make it more difficult to regulate and implement an efficient
and standardized waste treatment system. In addition, rummaging through the solid waste may
have a negative impact on the health and hygiene of these scavengers and waste collectors.
When the scavengers sort through and remove the recyclables from the waste collection
containers or stations, they also often scatter about the remaining unwanted waste on the street
which can cause sanitation problems. Waste minimization and recycling will remain a major
challenge in the future. The most important driving force for changing the current freelance
scavenge collection method should be based on the consideration of systematic waste
separation, which is a critical component of a successful integrated waste management system
and enables better financing of waste management while minimizing the energy and labor input
in the downstream process. The proposed project which includes pilot waste separation
components echoes the call for such changes.
11. For landfill, recovery rate of landfill gas in western countries is approximately 60%, in
China it is less than 20%. Another highly contaminating pollutant associate with landfill is
leachate. Often in China, only a negligible quantity of leachate is treated before being
discharged into the groundwater, endangering land, air and groundwater. Also, siting landfills at
greater distances from the central collection areas, implies higher transfer costs. Now, with
urbanization in China, land acquisition cost rose significantly, as a result, additional investments
in the infrastructure intensifies the financial problems of the responsible authorities. Moreover,
most existing landfill sites are already approaching their closure dates, and this problem is
S App 7 - 2
compounded by overloading which shortens their planned operational life, due to unexpected
increase in the volumes of waste generated.
12. More importantly, solid waste disposal and/or collection/treatment fee levies are
extremely low and could barely cover costs and only offset a small fraction of collection,
transport and treatment cost for the safe disposal of waste. Moreover, existing policies in China
are based on a flat rate charging systems regardless of the use of the service and thus present
no economic incentives for waste reduction and recycling for waste generation. For example, in
many of Jilin’s cities, the MSW fee per household is now 5 RMB/month (US$0.8/month). It is
documented in the literature that the construction cost of municipal solid waste disposal
establishments in was far more than the fees collectable. Such a strict flat rate approach
performs poorly as it is contrary to the “polluter pays” principle and is unable to create economic
incentives for waste producers to reduce and recover waste. On the other hand, although a
weight/ volume-based Pay-As-You-Throw (PAYT) system may provide incentives to reduce
waste generation, it will likely increase the authorities’ administrative costs and cause illegal
dumping. It is concluded that pilot projects and successful experience adopting PAYT system
should be promoted.
Table 1. China’s municipal solid waste collection and treatment for selected areas
Region per capita Collected Treated Treatment per capita 03-11 Per capita
SW in 2011(kg) (10k tons) (10k tons) Landfill Incineration Others Ratio (%) SW in 2003 (kg) growth rate(%)
National 0.65 16395.28 13089.64 10063.74 2599.28 426.62 79.70 1.09 -0.40
Beijing 1.00 634.35 623.20 429.57 94.46 99.17 98.24 1.49 -0.33
Liaoning 0.85 876.00 704.72 704.72 80.45 1.10 -0.22
Jilin 0.92 493.00 242.62 197.71 44.91 49.21 1.33 -0.31
Helongjiang 1.01 796.64 348.06 338.68 9.38 43.69 1.63 -0.38
Shanghai 0.92 704.00 429.69 362.71 59.23 7.75 61.04 1.54 -0.40
Guangdong 0.78 1978.80 1449.01 1094.19 326.42 28.40 72.12 1.08 -0.28
Source: China Statistical Yearbook series
13. Both project cities are lacking sound waste collection systems, leading small dump sites
within the urban area, contaminating the surface and ground waters, and the air quality. There
is also no systematic waste sorting, retrieval of landfill gases, and minimal effort in MSW
reduce, reuse and recycle.
14. The proposed project also includes a water supply subproject in Baishan city. Water
supply in Baishan relies on surface water sources (Qujiaying reservoir) with a current capacity
of 60,000 tons per day and shallow groundwater sources at 24,000 tons capacity. However the
reservoir is outdated and needs urgent rehabilitation. The groundwater suffers from severe
pollution and must be phased out as early as possible. The current scheme is also inadequate
to serve the population and can not ensure 24-hour water supply service. The non-revenue
water level is surprisingly high, i.e., estimated at around 65%. Xibeicha reservoir is a suitable
alternative source and the proposed project will finance the treatment facility of 40,000 m3/day
with pipeline networks.
15. Due to the rapid urbanization process, the exiting urban area at the center of Baicheng
City cannot meet the urban development needs. A new urban area in the west of the present
city is to be developed to facilitate urbanization. According to Baicheng urban development
master plan, the western and southern parts of the city will be the new urban center to host the
municipal government, as well as the new cultural and residential center. In the past several
years, the BMG has already invested and built the new areas by constructing some of the new
urban roads and municipal facilities. However, the urban road network is still largely incomplete
S App 7 - 3
with the missing links and sections. The proposed project will build the remaining urban roads
and bridges, water supply, sanitary sewers, power supply, stormwater drainage, public
transport, street lightings, etc.
16. The project will deliver four outputs:

(i) Efficient Integrated Solid Waste Management (ISWM) System in Baishan &
Baicheng;
(ii) Improved Water Supply Management in Baishan;
(iii) Improved Coverage of Urban Roads and Municipal Services in Baicheng;
(iv) Improved Capacity and Institutional Arrangement.
C. Demand Analysis
17. Daily solid waste generation is about 322 tons in Baishan, or 1.18kg per head, based on
the urban population of 273 thousand in Baishan. Currently there is a sanitation landfill with an
area of 4.28 ha, and daily treatment capacity of 350t. However, due to low design standard and
lack of funds and experience, breakages occur in bottom and sides of the impermeable
membrane and causing contamination of the downstream water bodies by the leachate. Local
residents blockaded the entrance of the landfill and the waste transfer trucks can not enter.
Thus currently solid waste is dumped at Nanshan landfill which is already abandoned. The 15
garbage collection and transfer stations are in poor conditions and rehabilitation is needed.
Thus, the proposed project will rehabilitate and extend the existing sanitary landfill with a total
capacity of 350 wet tons per day; rehabilitate 15 existing transfer stations and procurement of
compressible waste containers, waste transfer vehicles, collection trucks etc.; and procure
waste collection, street cleaning and snow removal equipment.
Table xx. Solid waste generation projection for Baishan
Year Population (10k) Per capita SW (kg/capita/d) Daily SW generation (t/d)

2011 27.30 1.18 322.14
2012 28.06 1.16 325.54
2013 28.85 1.14 328.89
2014 29.66 1.12 332.16
2015 30.49 1.10 335.36
2016 31.34 1.08 338.48
2017 32.22 1.06 341.51
2018 33.12 1.04 344.45
2019 34.05 1.02 347.28
2020 35.00 1.00 350.00
18. Baicheng has a total urban population of 350 thousand in 2012. Its daily solid waste
generated is 420t and per capita level is 1.2 kg. By 2020, it is projected that the urban
population will be 509 thousand and daily per capita solid waste will be reduced to 1.0 kg. The
water and organic content is high for domestic solid waste for Baicheng. Leachate is therefore a
serious problem. The 4 operating garbage collection and transfer stations are very inefficient
and the equipment and vehicles are out-of-date. The proposed project will seal the existing
landfill site; upgrading the MSW stations, and purchase treatment facilities. In particular, the
north side new landfill will need operating vehicles, and the south side needs upgrading of the
leachate treatment plant, gas collection and treatment, and surface sealing. 10 new mobile
waste compaction transfer stations are to be constructed and the associated compaction
vehicles are to be procured. Similar to Baishan, equipment for waste collection, street cleaning
and snow removal are to be procured under the project.
S App 7 - 4
Table xx. Solid waste generation projection for Baicheng
Year Population Per capita Daily SW Collection Target Treatment

(10k) SW generation rate (%) treatment volume
(kg/capita/d) (t/d) ratio (%) (t/d)
2012 35 1.2 420 95 87 365.40
2013 35.8 1.16 415.67 95 88 365.79
2014 36.7 1.13 414.33 95 89 368.76
2015 37.5 1.1 412.50 100 90 371.25
2016 40.18 1.08 433.94 100 91 394.89
2017 42.86 1.06 454.32 100 92 417.97
2018 45.54 1.04 473.62 100 93 440.46
2019 48.22 1.02 491.84 100 94 462.33
2020 50.9 1 509 100 95 483.55
Average 442.32 403.06
19. There are four water sources for Baishan water supply. Qiujiaying Reservoir can provide
a steady water supply to the city. The water supply capacity is 100,000 m3/d, and currently it
supplies 80,000 m3/d water for Baishan. The other water sources are Pearl Gate (Zhenzhumen
Gate), Kucanggou, and Jinying, with the capacities of 9,000 m3/d, 5,000 m3/d, 10,000 m3/d
respectively, all of which are ground water sources. It is a consensus that due to severe
groundwater pollution, groundwater sources are to be phased out.
20. Currently, Qujiaying reservoir supplies 80 thousand m3 daily, or almost full capacity, but
the facility is aged and the leakage in the source water transmission tunnel is serious,
threatening the reliability of water supply in the city. The Nanshan treatment plant which treats
water from Qujiaying reservoir, is outdated and using old standards that can not meet the new
state requirements for water quality. Some pipelines are eroded and need to be replaced. Most
importantly, it is projected that water demand will increase and current water supply system can
not meet the growing demand even at full treatment capacity. The following table, adapted from
the FSR, shows the projection of maximum daily domestic water consumption in Baishan, both
in per capita and aggregate terms.
Table xx. Composite domestic water consumption

2015 2020
Planned urban population (10k) 32.1 34.5
Water supply ratio (%) 100 100
Comprehensive daily domestic

190 210
water consumption (L/capita/d)
Comprehensive daily domestic

5.49 7.25
water consumption (10km3/d)
21. The FSR assumes that the comprehensive daily domestic water consumption per capita
is averaged at 200 liters which implies total water demand to be at 84.9 kt (thousand tons) per
day in 2015 and 116.7 kt in 2020. The second approach is the maximum daily per capita
domestic water consumption approach which assumes maximum daily per capita water
consumption is 350l in 2015 and 400l in 2020. With proper conversion, the average daily total
S App 7 - 5
water demand is then 112.35 kt in 2015 and 138.0 kt in 2020. The third approach is based on
the construction areas which results a projection of daily total water demand of 118.8 kt in 2015
and 133.4 kt in 2020. The average of the three approaches yields a water demand of 105.4 kt in
2015 and 129.4 kt in 2020.
Table xx. Total urban water supply and daily per capita consumption in China, 2011
Total water supply HH domestic water Composite daily
City
(10k tons) consumption (10k tons) average per capita (l)
National 4261890 1448744 93.58
Beijing 151815 58954 330.68
Tianjin 70138 20897 195.11
Liaoning 263441 48681 169.76
Jilin 74873 17549 81.90
Changchun 30287 6813 109.34
Jilin city 24268 4100 153.19
Siping 2398 427 19.29
Liaoyuan 3060 396 67.75
Tonghua 3829 989 46.39
Baishan 2880 820 61.31
Songyuan 4650 2730 43.92
Baicheng 3501 1274 47.33
Helongjiang 164186 37827 118.56
Shanghai 341389 97327 662.25
Shandong 191634 66842 55.06
Henan 141665 44285 35.45
Guangdong 717666 258881 230.73
Source: China Urban Statistic Yearbooks, China Statistics Yearbook
22. Observe that from the table above, national average for per capita composite water
consumption is only 93.6 liters. Notice Jilin’s average is merely 81.90 liters and in particular,
Baishan’s per capita water consumption is just 61.31 liters in 2011. The assumptions used in
the FSR are based on national standard and master-plans, complying the design standard in
PRC.
23. Water demand. Water demand projections are based on projected service area
population, and current and future consumption. Assumptions include the following: (i) per
capita water consumption assumptions specified above; (ii) annual population increase by 0.8%
to 2.1% in different project areas; (iii) constant household size; (iv) 50% of households
connected to water supply in first year of operation, 70% in the second year and 100% since
the third years for all subcomponents; (v) non-domestic demand based on actual conditions;
and (vi) losses at 30% of water production 2.
24. The urban road and municipal service component in Baicheng will improve the urban
infrastructures and municipal services in the new south and west urban areas of Baicheng. The
component is an important part of Baicheng’s masterplan for urbanization process and it
includes: i) construction of nine urban roads with a total length of 45.5 km; ii) construction of a
330 m bridge; iii) installation of a 29.8 km water supply piping network; iv) installation of a 23.5
2
See in a recent ADB financed Project in China (http://www2.adb.org/Documents/RRPs/PRC/40634/40634-01-prc-
ea.pdf)
S App 7 - 6
km sanitary sewer piping network, including two pump stations; v) installation of a 34.3 km
stormwater piping network with two pump stations; vi) installation of a 32.0 km 10 KV power
line; vii) installation of a 32.0 km communication line; viii) installation of a 13.1 km Class I
heating pipe network; ix) provision of street lighting, landscaping, and other associated facilities;
x) introduction of a people centered urban transport system with emphasis on developing
pedestrian/bicycle and public transport.
D. Assumptions
25. The economic evaluation of the project was carried out by comparing with-project and
without-project scenarios. All benefits and costs are in constant 2013 prices. The economic
costs of the project components include (i) capital cost, including land acquisition and
resettlement, and environmental mitigation and monitoring; and (ii) operation and maintenance
costs, including replacement cost of depreciated equipment. Tradable commodities were valued
at border prices at the prevailing exchange rate. Non-tradable commodities were valued
through shadow prices using a standard conversion factor of 0.987, and specific conversion
factors: 1.00 for equipment and civil works, 1.00 for skilled labor, and 0.67 for unskilled labor. A
shadow price was used to put an economic value on the wages paid to unskilled labor but not
on the wages paid to skilled labor.
E. Least-Cost Analysis
26. Least-cost analysis is used for alternative analysis. For example, the engineering
choices of sanitation landfill, incineration, and compost were assessed. In comparison with
developed countries, the net caloric value of MSW in China is far too low for waste heat
utilization and poorly suited to incineration because of the high concentration of foods waste
and the moisture content which may not be economically viable. Air pollution control (APC)
residues are another significant concern. Although dioxin levels are controlled to comply with
the standard, experience from China’s first large-scale MSW incinerator in China located in the
Pudong New Area of Shanghai shows that the level of Pb substantially exceeded the permitted
level of leachate toxicity for the landfill, and the residues also contained considerable amounts
of soluble salts, with a strong potential to pollute the groundwater after landfilling. In view of the
high cost, incineration is not considered in this project.
27. Although landfilling is financially least cost option, the ISWM components of the project
aim to implement the principles of reduce, reuse, and recycle as well as environmental
protection. Therefore, in Baishan ISWM, waste sorting and compost will be implemented for
newly constructed communities and a few others with well equipped facilities. The product of
compost will be used for horticulture of municipal gardens. Similar choices are applied for
Baicheng ISWM.
Table xx. Cost for landfill leachate treatment options (capacity: 150t/d)
Two stage DTRO MBR NF RO MVC-AP RO
Investment cost CNY11.0 million CNY10.5 million CNY11.0 million
O&M cost CNY35~50/t CNY30~40/t CNY25~30/t
28. For the engineering choices of leachate treatment, three options are compared, i.e.,
two-stage DTRO, MVC-AP and RO, and MBR+NF+RO. The MVC-AP and RO option is more
stable, requires smaller space, low labor input, and moderate investment and O&M costs. The
MBR+NF+RO has the lowest investment cost, but requires larger space and high labor input.
The two stage DTRO is costly. Hence the MVC-AP and RO option is chosen.
S App 7 - 7
29. For Baishan water supply component, least cost analysis is conducted for watershed
transmission pipeline routing, water treatment plant siting, as well as water treatment
engineering options etc. The FSR compares two alternative routing plans for the transmission
pipelines for Jiangyuan District and Hunjiang District respectively. The results are summarized
in the following tables.
Table xx. Least cost choice for transmission pipelines for Jiangyuan District
Option 1 Option 2
Transmission pipelines DN800 L=7500m PN0.6MPa DN800 L=6868m PN0.6MPa
Diameter, Length, Pressure
Table xx. Least cost choice for transmission pipelines for Hunjiang District
Option 1 Option 2
Transmission pipelines DN900 L=19000m PN0.6MPa DN900 L=16750m PN0.6MPa
Diameter, Length, DN900 L=1500m PN1.0MPa DN900 L=900m PN1.0MPa

Pressure DN900 L=3831m PN1.6MPa DN900 L=2975m PN1.6MPa
In Option 1 in Jiangyuan District and Option 2 in Hunjiang District, all transmission pipelines are
installed beneath the riverbed hence installation costs are substantially higher. In addition, total
lengths in the aforementioned two options are larger, making these two options financially and
economically undesirable. The maintenance costs are also higher for the riverbed case. Thus,
options 2 in Jiangyuan District and 1 in Hunjiang District are chosen according to the least cost
principle.
For the locational choice of the treatment plant, the FSR considers four options including the
reservoir area, Shangdianzi village, Nanshan WTP, and Hunjiang District Tongjiang bridge area.
The comparison boils down to reservoir area against Shangdianzi village. The two options are
equivalent in terms of energy consumption, but the latter requires less pipeline investment and
no land acquisition and resettlement. The estimated costs are RMB 153.02 million for reservoir
area versus RMB 125.87 million for Shangdianzi village, thus the latter is chosen as the least
cost option.
F. Economic Cost
30. Financial costs, including physical contingencies, were converted to economic costs
through different approaches. For the road component, the project costs included (i) the
economic costs of construction, including monetary compensation for land acquisition and
resettlement triggered by the road construction; and (ii) the economic costs of road operation
and maintenance.
G. Economic Benefit
31. The economic returns are mainly in the form of savings in road-user costs due to the
provision of a better road facility. The benefits depend on the future transport demand in the
area. The FSR applies standard transport model through simulations of the traffic load using
S App 7 - 8
existing data for calibration. By modifying the number of trips generated and attracted by each
area, it is possible to simulate changes in average daily intensities for each route, both with and
without the Project. Three types of benefits are taken into account: those due to changes in the
vehicles' operation costs, changes in accidents' costs, and user travel time savings.
32. The operation costs include: (i) maintenance, repairs and spare parts; (ii) tyres' wear
and tear; and (iii) fuel costs. Fuel consumption is calculated as a function of petroleum prices,
distances travelled and travelling speed. Average consumption per km at each speed is
estimated using national data. Accidents' costs with and without the Project are computed as a
function of total travelled distance. Note that theoretically this benefit can be negative in net
since although improve road infrastructure reduces the number of accidents which would take
place, would increase average driving speeds, thus increases the probability of death in each
accident. When converting travel time savings by absolute time values into monetary units, a
value for travel time savings needs to be chosen.
33. For quantification of economic benefits of the water supply project, normally the health
benefits constitute the large part. On top of the direct health benefits, the productivity and
production capacity of private sectors, such as agriculture and industries, also depend on
secure sanitary water availability. However these benefits, along with minor ones such as
benefits accrued to amenity values, local tourism, and fishery industries are difficult to quantify
not only because of their insignificant scale, possible double counting, but also due to the lack
of data. Thus estimating total economic gains per expenditure approach yields too large
variation. In the current analysis, the valuation of the benefits of is measured by appropriate
estimation of society's willingness to pay for the benefits. Formally, the economic benefits of the
project are measured by residents’ willingness-to-pay (WTP) estimated by the consultant based
on social and economic survey. 3
H. Economic Cost-Benefit Analysis
34. The base case EIRR calculation for Baicheng urban road infrastructure and service
component is presented in the following table. At a 12% discount rate, the project is found to be
economically viable. The NPV for the whole project is CNY 553.9 million and the base case
EIRR for the whole project is 16.0%, which exceeds the EOCC. The EIRRs for the Baishan
Improved Coverage of Urban Roads and Municipal Service, Baishan Improved Water Supply
Management, and Baishan efficient ISWM are 16.0%, 16.0%, and 15.1%. The sensitivity
analysis shows that the project’s economic return is robust against negative impacts from
benefit reduction, cost overrun and project implementation delay. The results of the sensitivity
analysis, EIRR for each subproject, as well as the whole project, are presented below.
Table xx. Sensitivity Analysis

Cases EIRR NPV(CNY million)
Base Case 16.0% 553.9
(i) Benefits reduce 10% 14.7% 363.6
(ii) Investment cost increase 10% 14.9% 433.9
(iii) delay one year 14.7% 409.9
(iv) Combination of (i), (ii), and (iii) 12.5% 70.2
3
Willingness-to-pay estimation is explained in detail as an appendix.
S App 7 - 9
Table 6.x Economic Internal Rate of Return for Baicheng subproject (CNY million)
BENEFITS for Road Benefit for COSTS
VOC Savings Passenger Savings in Solid Waste Total Net
Total O&M
Normal Generated Time Savings Maintenance Management Benefit Capital Costs Cost Benefits
2014 0.00 0.00 0.00 0.00 0 201.62 0.00 201.62 -201.62
2015 0.00 0.00 0.00 0.00 0 403.23 0.00 403.23 -403.23
2016 0.00 0.00 0.00 0.00 0.00 604.85 0.00 604.85 -604.85
2017 0.00 0.00 0.00 0.00 0.00 107.53 0.00 107.53 -107.53
2018 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
2019 129.24 31.92 27.10 0.00 2.60 190.86 3.21 3.21 187.65
2020 142.35 35.11 30.43 0.00 2.60 210.49 3.30 3.30 207.19
2021 156.84 38.63 34.16 0.00 2.60 232.23 3.40 3.40 228.83
2022 172.84 42.51 38.36 0.00 2.60 256.31 3.50 3.50 252.81
2023 181.01 51.82 42.15 0.00 2.60 277.58 18.04 18.04 259.54
2024 189.62 62.31 46.35 0.00 2.60 300.89 3.61 3.61 297.28
2025 198.70 74.14 51.00 0.00 2.60 326.45 3.72 3.72 322.74
2026 208.29 87.46 56.16 0.00 2.60 354.51 3.83 3.83 350.68
2027 218.41 102.43 61.89 0.00 2.60 385.33 3.94 3.94 381.38
2028 229.10 119.26 68.24 0.00 2.60 419.20 40.61 40.61 378.59
2029 240.41 138.17 75.29 0.00 2.60 456.47 4.06 4.06 452.41
2030 252.37 159.39 83.13 0.00 2.60 497.50 4.18 4.18 493.31
2031 265.04 183.22 91.85 0.00 2.60 542.70 4.31 4.31 538.39
2032 278.46 209.94 101.54 0.00 2.60 592.55 4.44 4.44 588.11
2033 292.69 239.93 112.33 0.00 2.60 647.56 22.85 22.85 624.70
2034 307.80 273.56 124.35 0.00 2.60 708.31 4.57 4.57 703.74
2035 323.85 311.27 137.74 0.00 2.60 775.46 4.71 4.71 770.75
2036 340.91 353.58 152.67 0.00 2.60 849.75 4.85 4.85 844.90
2037 359.06 401.02 169.32 0.00 2.60 932.00 4.99 4.99 927.00
2038 370.91 454.25 187.90 0.00 2.60 1015.66 5.14 5.14 1010.52
PV 852.61 428.50 511.89
IRR 16.0%
S App 7 - 10
Table 6.x Economic Internal Rate of Return for Baishan water supply subproject (CNY
million)
Benefit Cost
Net
Year Water Investment O&M
Total Total Benefits
Supply Cost Cost
2014 0.00 0.0 7.0 0.0 7.0 -7.0
2015 0.00 0.0 52.6 0.0 52.6 -52.6
2016 0.00 0.0 91.1 0.0 91.1 -91.1
2017 0.00 0.0 143.7 0.0 143.7 -143.7
2018 0.00 0.0 28.0 0.0 28.0 -28.0
2019 66.58 66.6 0.0 10.6 10.6 56.0
2020 83.22 83.2 0.0 11.2 11.2 72.0
2021 83.22 83.2 0.0 11.2 11.2 72.0
2022 83.22 83.2 0.0 11.2 11.2 72.0
2023 83.22 83.2 0.0 11.2 11.2 72.0
2024 83.22 83.2 0.0 11.2 11.2 72.0
2025 83.22 83.2 0.0 11.2 11.2 72.0
2026 83.22 83.2 0.0 11.2 11.2 72.0
2027 83.22 83.2 0.0 11.2 11.2 72.0
2028 83.22 83.2 0.0 11.2 11.2 72.0
2029 83.22 83.2 0.0 11.2 11.2 72.0
2030 83.22 83.2 0.0 11.2 11.2 72.0
2031 83.22 83.2 0.0 11.2 11.2 72.0
2032 83.22 83.2 0.0 11.2 11.2 72.0
2033 83.22 83.2 0.0 11.2 11.2 72.0
2034 83.22 83.2 0.0 11.2 11.2 72.0
2035 83.22 83.2 0.0 11.2 11.2 72.0
2036 83.22 83.2 0.0 11.2 11.2 72.0
2037 83.22 83.2 0.0 11.2 11.2 72.0
2038 83.22 83.2 0.0 11.2 11.2 72.0
NPV 344.3 344.3 220.2 47.1 267.4 76.9
EIRR 16.0%
S App 7 - 11
Table 6.x Economic Internal Rate of Return for Baishan ISWM subproject (CNY million)
Benefit Cost
Year Solid Waste Capital Net Benefits

Fertilizer Total O&M Total
Management Cost
2014 0.00 0.0 0.0 3.6 0.0 3.6 -3.6

2015 0.00 0.0 0.0 27.2 0.0 27.2 -27.2
2016 0.00 0.0 0.0 54.5 0.0 54.5 -54.5
2017 0.00 0.0 0.0 81.7 0.0 81.7 -81.7
2018 0.00 0.0 0.0 14.5 0.0 14.5 -14.5
2019 30.67 27.4 58.0 0.0 21.4 21.4 36.7
2020 30.67 27.4 58.0 0.0 21.4 21.4 36.7
2021 30.67 27.4 58.0 0.0 21.4 21.4 36.7
2022 30.67 27.4 58.0 0.0 21.4 21.4 36.7
2023 30.67 27.4 58.0 0.0 21.4 21.4 36.7
2024 30.67 27.4 58.0 0.0 21.4 21.4 36.7
2025 30.67 27.4 58.0 0.0 21.4 21.4 36.7
2026 30.67 27.4 58.0 0.0 21.4 21.4 36.7
2027 30.67 27.4 58.0 0.0 21.4 21.4 36.7
2028 30.67 27.4 58.0 0.0 21.4 21.4 36.7
2029 30.67 27.4 58.0 0.0 21.4 21.4 36.7
2030 30.67 27.4 58.0 0.0 21.4 21.4 36.7
2031 30.67 27.4 58.0 0.0 21.4 21.4 36.7
2032 30.67 27.4 58.0 0.0 21.4 21.4 36.7
2033 30.67 27.4 58.0 0.0 21.4 21.4 36.7
2034 30.67 27.4 58.0 0.0 21.4 21.4 36.7
2035 30.67 27.4 58.0 0.0 21.4 21.4 36.7
2036 30.67 27.4 58.0 0.0 21.4 21.4 36.7
2037 30.67 27.4 58.0 0.0 21.4 21.4 36.7
2038 30.67 27.4 58.0 0.0 21.4 21.4 36.7
NPV 130.0 116.0 246.0 123.9 90.5 31.6
EIRR 15.1%
S App 7 - 12
Table 6.x Economic Internal Rate of Return for the whole project (CNY million)
Benefits Costs
Year Baishan Net Benefits

Baicheng Baishan Capital
Water Total O&M Total
subproject ISWM Costs
Supply
2014 0 0.0 0.0 0.0 212.3 0.0 212.26 (212.26)
2015 0 0.0 0.0 0.0 483.0 0.0 483.04 (483.04)
2016 0 0.0 0.0 0.0 750.5 0.0 750.45 (750.45)
2017 0 0.0 0.0 0.0 332.9 0.0 332.93 (332.93)
2018 0 0.0 0.0 0.0 42.6 0.0 42.56 (42.56)
2019 190.86 66.6 58.0 315.5 0.0 35.1 35.12 280.36
2020 210.49 83.2 58.0 351.8 0.0 35.8 35.85 315.91
2021 232.23 83.2 58.0 373.5 0.0 35.9 35.95 337.55
2022 256.31 83.2 58.0 397.6 0.0 36.1 36.05 361.53
2023 277.58 83.2 58.0 418.8 0.0 50.6 50.59 368.26
2024 300.89 83.2 58.0 442.2 0.0 36.2 36.16 406.00
2025 326.45 83.2 58.0 467.7 0.0 36.3 36.26 431.45
2026 354.51 83.2 58.0 495.8 0.0 36.4 36.38 459.40
2027 385.33 83.2 58.0 526.6 0.0 36.5 36.49 490.10
2028 419.20 83.2 58.0 560.5 0.0 73.2 73.16 487.31
2029 456.47 83.2 58.0 597.7 0.0 36.6 36.61 561.13
2030 497.50 83.2 58.0 638.8 0.0 36.7 36.73 602.03
2031 542.70 83.2 58.0 684.0 0.0 36.9 36.86 647.11
2032 592.55 83.2 58.0 733.8 0.0 37.0 36.99 696.83
2033 647.56 83.2 58.0 788.8 0.0 55.4 55.40 733.42
2034 708.31 83.2 58.0 849.6 0.0 37.1 37.12 812.46
2035 775.46 83.2 58.0 916.7 0.0 37.3 37.26 879.47
2036 849.75 83.2 58.0 991.0 0.0 37.4 37.40 953.62
2037 932.00 83.2 58.0 1073.3 0.0 37.5 37.54 1035.72
2038 1015.66 83.2 58.0 1156.9 0.0 37.7 37.69 1119.23
NPV at 12% 1,377.5 166.8 1,349.4 553.9
EIRR 16.0%
S App 7 - 13
Appendix.
Willingness to Pay Estimation
35. In the current project, the economic benefits of the water supply and solid waste
management components of the proposed project are measured by residents’ elicited
willingness-to-pay (WTP). The WTP estimation is done based on the project social and
economic survey results. A total of 199 effective observations are obtained in the sample. The
survey elicited the respondents’ WTP by asking a series of value ranges with right censoring. 4
Thus a standard Tobit is used to estimate the true WTP. The followings describe the estimation
procedures.
36. For censored data, limited dependent variable models such as Probit or Tobit are used
instead of ordinary least square regression models. In the standard Probit analysis, which
*
assumes that the underlying response variable yi defined by the regression relationship
yi* β ′xi + ui
=
*
and variable yi is not observable. Only a dummy variable y is observable which is defined by
1, if yi* > 0
y=
0, otherwise
37. Therefore
Pr( yi= 1)= Pr(ui > − β ′xi )
1 F ( − β ′xi )
=−
where F is the cumulative distribution function of u. If this distribution function is logistic, then it
is the logit model. Not all distribution functions yield closed-form solutions for F. For instance, in
( )
the Probit model where u follows a normal distribution N 0, σ , MLE can only estimate β / σ
2
not β and σ separately. However, as we argue, the logit model only offers odds ratio, which
essentially is a probability of whether a given subject is willing to pay above a certain threshold.
It does not estimate the mean of the WTP.
38. Hence we use a tobit model to estimate the WTP. The tobit model is defined as follows.
 β ′x + u if RHS > 0
yi =  i i .
0 otherwise
39. It is a censored normal regression model. As such, its estimation is related to the
estimation of censored and truncated normal distributions. The log-likelihood function can be
written as
 
1  −∑ 1 ( y − β ′x ) 2
log=
L ∑0 log(1 − F ) + ∑1 
log 
( ∏ )
2 1/2 
1 2σ
i 2 i i
 2 σ 
where the first sum is over the N0 observations for which yi = 0 and the second product is over
the N1 observations for which yi > 0 . Using maximum likelihood estimation, one obtains the
estimates on β .
40. Using Stata, the β is estimated by the tobit model. A number of variable combinations
were attempted and the most appropriate models are chosen. In particular, for the WTP on
water supply, the constant, household assets, and household income are statistically significant.
4
The survey questions including WTP related questions in the questionnaires were designed by the consultant team
and revised according to ADB comments.
S App 7 - 14
In the WTP for solid waste treatment, the household average education level is also statistically
significant. The regression results are shown below in table 6.x.
Table 6.x Tobit Regression Result for water supply

Tobit regression Number of obs = 199
LR chi2(2) = 13.23
Prob > chi2 = 0.0013
Log likelihood = -222.69133 Pseudo R2 = 0.0288
------------------------------------------------------------------------------
wtpwater | Coef. Std. Err. t P>|t| [95% Conf. Interval]
-------------+----------------------------------------------------------------
income | 2.38e-06 7.46e-07 3.19 0.002 9.05e-07 3.85e-06
asset | 4.49e-07 2.62e-07 1.71 0.089 -6.85e-08 9.66e-07
_cons | 3.897187 .0741036 52.59 0.000 3.751049 4.043325
-------------+----------------------------------------------------------------
/sigma | .7329934 .0370895 .65985 .8061367
------------------------------------------------------------------------------
Source: Consultant’s estimate.
Table 6.x Tobit Regression Result for ISWM

Tobit regression Number of obs = 199
LR chi2(3) = 69.36
Prob > chi2 = 0.0000
Log likelihood = -731.12001 Pseudo R2 = 0.0453
------------------------------------------------------------------------------
wtpwaste | Coef. Std. Err. t P>|t| [95% Conf. Interval]
-------------+----------------------------------------------------------------
income | .0000715 .000012 5.95 0.000 .0000478 .0000952
asset | .0000196 4.34e-06 4.52 0.000 .0000111 .0000282
aveedu | 3.212023 .9145525 3.51 0.001 1.408397 5.01565
_cons | 5.967537 2.900334 2.06 0.041 .2476687 11.68741
-------------+----------------------------------------------------------------
/sigma | 11.78456 .6245317 10.5529 13.01622
------------------------------------------------------------------------------
41. Given average per capita income, household asset levels, and education levels in
Baishan and Baicheng cities, the estimated results yield an average WTP for water supply of
CNY4.13 per ton in Baishan and CNY 27.51 per household per month for solid waste fees.
S App 7 - 15
Financial Management Assessment

FINANCIAL MANAGEMENT ASSESSMENT
A. Summary
1. Effective financial management is crucial for a project’s success in implementation. The

purpose is to ensure that the IA has adequate financial management capability to implement the
Project. The EA/IA’ financial management arrangements should be capable in recording all
transactions and balances, timely provision of regular and reliable financial statements,
safeguarding the entity’s assets, and compliance with ADB requirements.
2. The assessment follows ADB’s Guidelines for Financial Management and Analysis of
Projects (2005). The FMA has been conducted to assess the financial management capacity
of the IAs, funds flow arrangements, staffing, accounting policies and procedures, internal and
external auditing arrangements, reporting and monitoring aspects, and financial information
systems. Issues or risks associated with the IAs’ financial management systems were identified,
and appropriate risk mitigation measures were suggested to facilitate more effective project
design and implementation.
3. A full set of financial assessment questionnaires were completed, attached in the Appendix.
The overall FM risk-rating of the Project is medium. The identified risks in financial management
will be closely monitored during project implementation.
B. Project
4. The Project will include three outputs/components: (i) improved water resources protection;
(ii) inclusive urban and rural water supply system; and (iii) strengthened institutional and staff
capacity. The project’s estimated costs and implementing arrangement are shown in Table 1
below.
Estimated
No. Project components costs($ Mi Implementing Agencies
llion)
1
398.82
Improved Urban Road and Municipal
2 Baicheng Municipal Government
Services in Baicheng 238.40
3 Baishan Urban Water Supply Baishan Municipal Government
61.70
4 Baishan Urban Solid Waste Management Baishan Municipal Government
29.43
C. Executing Agency
5. Jilin Provincial Government (JPG) will be the executing agency (EA), responsible for overall
planning and management of the Project. The responsibilities of the JPG relating to financial
management, at least, include the following:
(1) Providing counterpart funding;

(2) Monitoring implementation progress;
(3) Payment of the procurement contract;
(4) Reviewing the progress reports and semi-annual reports submitted to ADB;
(5) Conducting all correspondence with the ADB; and
(6) Borrowing and repaying the principal and interest of the ADB loan.
6. The IAs do not have experience with foreign funded projects. But they attach proper
importance to this project. The IAs have already set up the leading groups, specifically
S App 8 - 1
responsible for the implementation of the project. The JPG has ADB project management
experience and it will provide guidance and assistance to IAs when needed. JPG has
designated staff responsible for the guidance and tracking the project has been assigned.
7. Therefore, it is suggested to adjust the project management staff by strengthening the study
and training. Special attention shall be directed to the reporting system, cost control and audit
process, loan proceeds disbursement and loan repayment, fund monitoring and management
and contract implementation etc.
D. Implementing Agencies
1. There will be two Implementing Agencies for the Project including (1) Baishan Municipal
Government (BSMG); (2) Baicheng Municipal Government (BCMG). Both have established
PLGs. The PLG of the Baishan Government is headed by the executive vice mayor. The
members include two vice mayors and the heads of the municipal Water Affairs Bureau (WAB),
Housing and Urban Construction Bureau (HUCB), Development Reform Commission (DRC),
and Finance Bureau (FB). A PIU has been established under the Baishan DRC, headed by the
director of the bureau. The PIU will be responsible for preparing and implementing the water
supply subproject and ISWM system subproject. The PIU includes the general manager of
Baishan Xibeicha Qiyuan Hydropower Co. Ltd, who will coordinate the implementation of water
supply component and the general manager of Baishan Solid Waste Disposal Co. Ltd, who will
be coordinating for the implementation of the ISWM component. The solid waste disposal
facilities will be transferred to Baishan Environmental Sanitation Management Department for
O&M. At present, it is not undecided if the project water supply facilities will be transferred to
Baishan Water Group Co. for operation and maintenance (O&M) when the construction is
completed.
2. The Baicheng PLG is headed by the executive vice mayor. The members include two
vice mayors and the heads of the municipal DRC, HUCB, FB, Supervisory Bureau, Land
Resources Bureau, Environment Protection Bureau (EPB), Forestry Bureau, Auditing Bureau,
Planning Bureau, and Financing Office, Baicheng Industrial Park, Management Committee of
Baicheng Economic Development Zone (BEDC), and Command Office for New District
Construction. A PIU has been established under the Management Committee of BEDC. The
director of the Management Committee acts as the director the PIU. The PIU will be responsible
for preparing and implementing the Baicheng infrastructure subproject. After construction, the
municipal environmental sanitation departments of various districts will be responsible for future
O&M of the facilities.
8. The responsibilities of the PLGs relating to financial management, at least, include the
following:
(1) Certification of contractor payments;

(2) Preparation of reimbursement applications;
(3) Maintenance of consolidated financial and physical progress reports;
(4) Monitoring of counterpart fund utilization;
(5) Consolidation of financial statements of all project components;
(6) Preparation of progress reports and semi-annual reports.
9. The proposed project involves four components and the PLGs will coordinate and guide the
implementation the components. These PIUs/PLGs assume financial management and project
management in the process of construction, operation and maintenance. Therefore, a thorough
understanding of the ADB and national management requirements, as well as an integrated and
unified form of project management in accounting, financial management, procurement and
disbursement are all highly encouraged. Early development of the project management system
S App 8 - 2
in key areas will considerably improve the project’s effectiveness and efficiency. The working
rules and procedures should be gradually established and specified in a forthcoming project
management manual. Therefore, it calls for attention to quickly strengthen the capacity of the
PLGs. More professional staff members will have to be recruited in the PMO. With the support
of the consultants, the PLGs should realistically assess and identify the project’s management
and coordination requirements, in order to prepare a preliminary project management manual
that will guide the future institutional setup and management of the project.
10. Individual financial management assessments are presented below.
Baicheng Economic Development Zone Investment Company Co. (BEDZIC)
11. The BEDZIC will implement the Baicheng project components. The BEDZIC is a
state-owned enterprise established in August, 2009. Its registered capital is CNY 5.01 million. Its
business scope includes state-owned asset operation, agribusiness, stock investment, venture
investment, rental, guarantee etc. There are 2 staff members working in the Financial
Department: 1 accountant and 1 cashier. All financial personnel have accounting qualification.
12. It has been found during the preliminary assessment that BEDZIC’s current accounting
records and statements are adequate and effective. It complies with enterprise accounting
standard and regulations. The General Ledger and subsidiary ledgers are reconciled and
balanced. Document management is based on the PRC Accounting Law and Archives Law.
It is able to provide related financial information and statements in a timely manner. Monthly
and yearly financial statements are prepared for BEDZIC. Annual statements are available
within 15 days of year-end. But the company does not have internal audit department. The
external audit department does not audit it each year.
13. However, the company does not have experience with foreign funded projects. Its staff
expressed a desire to receive training regarding ADB procedures and policies. The company
agreed to set up a special account for the project and accounting according to "accounting
system of state-owned construction units" and provide relevant financial monitoring statements
and/or reports to meet the ADB requirements.
14. It is suggested to strengthen the followings: establishing internal controls and audit systems;
applying a computerized financial management system; adding more staff members; developing
reporting and monitoring information systems.
Baishan Xibeicha Qiyuan Hydropower Co. Ltd. (BXQHC)
15. BXQHC will implement the Improved Water Supply Management in Baishan. It is a
state-owned enterprise directly under the supervision of Baishan Water Affairs Bureau. It will
coordinate the preparation and implementation of the IWSM subproject. According to the current
arrangement, once the project construction is completed, the water supply facilities will be
transferred to Baishan Water Group Co.
16. The preliminary assessment of BXQHC reveals that its current accounting records,
statements, and procedures are adequate and effective. Document management is based on
the PRC Accounting Law and Archives Law. It is able to provide related financial information
and statements in a timely manner.
17. Likewise, the company does not have experience with foreign funded projects. But the
company does not show an interest in receiving training on foreign exchange risk hedging, as
indicated in the completed questionnaire. It is then recommended to strengthen the BXQHC’s
financial department by recruiting dedicated staff for the project, and receiving relevant training
on ADB procedures and policies, together with other IAs and PIUs.
S App 8 - 3
Baishan Solid Waste Disposal Co. Ltd. (BSWDC)
18. The BSWDC was established in 2002 with a registered capital of 8 million RMB. It is under
the direct supervision of Baishan Housing and Urban Construction Bureau. The preliminary
assessment shows that its accounting department can provide related financial information and
statement in a timely manner. Its financial procedures and statement comply the enterprise
accounting standard and regulations. Document management is based on the PRC Accounting
Law and Archives Law. However the company does not have a computerized accounting system,
and there is no external auditing.
19. It is suggested to strengthen the followings: receive external audit and gradually establish its
own internal audit system; establish a computerized financial management system; adding more
staff members to the financial department; receiving relevant trainings on ADB procedures and
policies.
E. Fund Flow Mechanism
20. The proposed lending and on-lending process of the Project is illustrated in below Figure.
Once the Loan Agreement is signed between ADB (the Lender) and the Ministry of Finance
(MOF) of the PRC (the Borrower), the MOF will make the proceeds of the ADB loan available to
Jilin Provincial Government (JPG) through a subsidiary loan agreement. An imprest account will
be established under the JPFD on behalf of JPG after the loan becomes effective. The JPFD will
be responsible for the use, management, replenishment and liquidation of the imprest account
and the imprest account will be exclusively used to finance the ADB share of the eligible
expenditures. The JPFD will further sign an onlending agreement with the BSMG and BCMG.
The IAs will make the project implementation arrangements with the PIUs for the project fund
disbursements.
21. The IAs will, as the end borrower, repay the debt and assume the foreign exchange and
interest rate variation risks for the ADB loan. The IAs, on behalf of the JPG, will be responsible
for disbursement control and approval of all subprojects. It needs to perform effective
management of the loan proceeds utilization to maximize the benefits of the loan.
S App 8 - 4
Asian Development Bank

reimbursement/re
plenishment of
Loan imprest account
Direct payments to
Ministry of Finance(on behalf of PRC Central supplies/consultant
G )
Relending
Jilin Provincial Finance Bureau on behalf of Jilin Provincial Government

Imprest Account Payments from
imprest account
Onlending
Baishan and Baicheng Municipal Finance Bureaus (on behalf

of BSMG and BCMG respectively)
Onlending
Counterpart funding PIU (1) IA 6

IA 4
and payments BEDZIC BSWDC
BXQHC
Contractors, Consultants, and Supplies
Lending, relending, onlending

EA=executing agency IA=implementing agency PIU=project implementing unit;
ADB repayment
Counterpart funding and payments
Payment claims and withdrawal applications S App 8 - 1
F. Summary of findings
22. The following risk assessments are based on existing circumstances, staffing and procedures and include recommendations for risk
mitigation measures. The assessments also include if the accounting systems and internal control are adequate to ensure that project funds are
used economically and efficiently and for the purpose intended, and that the use of the funds will be properly reported. The results of the risk
assessments are listed in Table 1 and Table 2.
Table 1: Summary Risk Analysis of Executing Agency
Particulars Risk Assessment Remarks
Although JPG has implemented a number of ADB projects. It is understaffed and not deeply involved in
1.Executing Agency Medium
project management.
2. Funds Flow Low JPG has experience on onlending.
3. Staffing Medium The personnel only macro-manages the project and not very into the details
4. Accounting Policies
Low Accounting policies and procedures is based on generally accepted accounting standards.
and Procedures
5. Internal Audit Low An internal audit section is in place in JPG.

During the project implementation, the Jilin Financial Bureau will be audited by Jilin Provincial Audit
6. External Audit Low
Department
7. Reporting and
Low The EA does not need to submit reports and the monitoring is covered by the audit.
Monitoring
8. Information Systems Low JPG uses an automated accounting system.
S App 8 - 1
Table 2: Summary Risk Analysis of Implementing Agencies
Particulars Risk Assessment Remarks
IAs will be responsible for the implementation, operation and maintain management of the Project. They
1. Implementing Agencies Medium
have no experience in managing and implementing construction projects.
Although IAs are not in charge of fund payment, their lack of ADB loan experience will make the
2. Funds Flow Medium
supervision of PIU less effective.
Some IAs have no sufficient staffs and experienced staff. However, the finance staff will receive training
3. Staffing Medium
in ADB financial management and disbursement procedures.
4. Accounting Policies and The IAs will adopt an accounting policy that is based on Generally Accepted Accounting Standards
Low
Procedures (GAAS).
5. Internal Audit Medium

The project accounts will be audited by an independent external auditor on an annual basis. The audit
6. External Audit Low will be done in accordance with the Chinese accounting and auditing system and will comply with the
requirements of ADB.
The IAs have no experience of construction project financial reporting, but would like to strengthen the
7. Reporting and Monitoring Low
study and training in order to meet the requirements.
8.Information Systems Medium The IAs will adopt accounting system software for financial reporting for the Project.
23. Therefore, the overall FM risk-rating of the project at appraisal stage is medium. The main problem is the lack of management ADB project
experience and sufficient accountants; lack of accountants for review procedure; and insufficient auditing. The identified risks in financial
management will be closely monitored during project implementation. There are no other significant weaknesses are identified on top of the
aforementioned risks.
G. Conclusion and Recommendations
24. This section summarizes the actions identified throughout the assessment for managing the risks to the proposed Project.
25. The followings are the proposed actions to be undertaken during the implementation of the proposed Project:
S App 8 - 2
(i) Add PMO and IAs’ financial staff;

(ii) Complete and develop financial policies and procedures manual in order to guide staff activities and ensure staff accountability;
(iii) Develop regular training plan for accounting staff and training policies. Regular training on ADB disbursement policies to be provided;
(iv) Purchase financial software and receive training for operating the system.
(v) Regular backup of all accounting systems and appropriate security measures over the backup data;
26. The PMO and IAs agree the aforementioned recommendations and will undertake them during the implementation.
S App 8 - 3
Responses to the Financial Management Assessment Questionnaire – Baicheng Economic Development Zone Investment Company
Topic Response
Name of agency Baicheng Economic Development Zone Investment Company Co.
(BEDZIC)
Project component that agency is responsible for Improved coverage of urban roads and municipal services in Baicheng
Name of person responsible for filling this form Sun, Hongguang
Position and title of person responsible for filling this form Baicheng Economic Development Zone Financial Bureau, deputy director
Nature of agency’s responsibility for the Project (check all that apply) √ Provide counterpart funding
√Sign a follow on loan contract for ADB funds
√Management of project construction
√Management of contributions from NGOs or project beneficiaries
√Project operation and maintenance
√Financial management of project
 Generate funds from tariffs, taxes or other sources to service the ADB
loan
Other – describe
1 Implementing Agency
1.0 What is your agency’s legal status and registration? State majority share controlled
1.1 What is your agency’s governing body? Baicheng Economic Development Zone Administrative Committee
1.2 What is the governing body’s relationship to the Government? government functional departments
1.3 Can the governing body make decisions independently of Government? If √YES
NO, please explain what decisions need government approval. NO explain:
1.4 Has your agency implemented an externally-financed project in the past? If YES briefly describe
yes, please provide details?
√NO
1.5 What are the statutory reporting requirements for your agency with respect According to accounting law, prepare annual financial reports
to finance?
1.6 Describe your agency’s organizational structure? (please attach an √Organization chart attached
S App 8 - 4
Topic Response
organization chart)
董事长
总理
项目部财部综合部
Organization chart not attached

1.7 Is the organizational structure appropriate for the needs of the Project? Yes, but since no experience on foreign funded projects, capacity
strengthening is required.
1.8 Has or will your agency established a project management office? √YES, already have project office, established on April 2012
YES, will set up project office
NO
1.8.1 organization chart

主任
副主任
移民社
合同管
工程组会计组行政组会与环
理组
境组
1.8.2 Please describe the setup of the PMO, names and positions of staff Engineering team: Sun Changming, Hou Yuliang, Liu Yuchen,
Contract management team: Dai Ping, Zhuang Hong, Lv Tiezheng,
Accounting team: Sun Hongguang, Gu Jianqiang, Sun Yaying
Administrative team: Guan Tingzhi, Li Na, Hu Nan, Yang He
S App 8 - 5
Topic Response
Resettlement, Social and Environment Team: Xu Zhongmin, Wang Wei,
Song Lei
1.8.3 responsibility and background of the leaders Engineering team: Sun Changming,
Contract management team: Dai Ping,
Accounting team: Sun Hongguang, Certified Accountant
Administrative team: Guan Tingzhi,
Resettlement, Social and Environment Team: Xu Zhongmin,
1.8.4 please describe the responsibilities of each department: Engineering team: review and manage the FSRs; supervise the
implementation of the project with the assistance of consulting team;
coordinate the implementation contractors to ensure proper progress and
quality; document preparation; progressive report review and submission to
provincial PMO;
Contract management team: coordinate procurement and contract
negotiation; review detailed design, budget, bidding and engineering
standards with the assistance of consulting team; design and implement
annual procurement plans; prepare and manage contracts; review project
progress; submit procurement and project implementation report to
provincial PMO;
Accounting team: prepare payment tracking and forecast; preview the
payment request to the contractors prior to submission to provincial PMO;
financial management including cost estimate, financial report preparation,
budget management, audit; prepare ADB loan repayment plan; internal
financial controal, including software development and application.
Administrative team: daily administrative duties; coordinate with ADB,
PPMO, consulting team, bidding agent, contractors, construction supervisor
etc.; project documentation, reporting, translation, and meetings;
Resettlement, social and environmental team: prepare and implement
social evaluation; prepare resettlement action plan; implement
environmental management plan, implement environment monitoring; edit,
review and submit other documents with the assistance of consulting team.
1.9 If the ADB loan is approved, what staffing changes will you make to assist Recruit staff with foreign funded project experience and higher levels to
with project implementation? assist the implementation of the project
1.10 Does the Project have written job descriptions that define duties, √YES – have already prepared these (attach job descriptions for the top
responsibilities, lines of supervision, and limits of authority for staff? two positions)
Written job descriptions are being or will be prepared
NO
S App 8 - 6
Topic Response
1.11 Do you have regular training acitivities? If so, please describe the area, Yes, regular annual training for accountants
format and frequency of the training.
1.12 Do you have specific training targeted at the current project? If so, please Yes, we will diligently participate every training event organized by ADB
describe detailed plans.
1.13 Do you have development plans for human resources, please describe. no
2 Funds Flow Arrangements
2.0 Describe proposed project funds flow arrangements. Include a chart and ADB Loan: ADB →Ministry of Finance → Jilin Provincial Finance Bureau
explanation of the flow of funds from ADB, government and other →Baicheng Municipal Finance Bureau →Baicheng Economic Development
financiers to each lower level that will receive funds. Zone Finance Bureau→contractors
2.1 Are the (proposed) arrangements to transfer the proceeds of the loan from √YES
the government to the implementing agency satisfactory? NO briefly explain why not
 Not applicable
2.2 Describe any past problems experienced in receiving investment funds from No problem
funding sources?
2.3 Describe proposed on-lending arrangements from the Government to your Baicheng government assumes the repayment responsibility
agency, including on-lending terms and conditions.
2.4 Will your agency use an imprest account to manage ADB funds? If YES, in √YES name of bank Bank of China, Baicheng Branch
which bank will the Imprest Account be opened? NO
2.5 Does your agency have experience in the management of disbursements no experience
from ADB?
2.6 Does your agency have experience managing foreign exchange risks? YES
√NO
2.7 Will your agency need to develop capacity to manage foreign exchange √ YES.  Explain capacity building arrangements: Propose training on
risks? If yes, what arrangements have been made to develop this how to reduce risk of exchange rate and interest rate, by higher level of
capacity? finance bureaus, foreign exchange bureaus or ADB consultants.
 NO
2.8 Is your agency is responsible for providing counterpart funds? If YES answer YES answer questions 2.8.1 to 2.8.3
the next 3 questions. √NO
2.8.1What is the source of the counterpart funds: revenues generated by your
business activity, government tax funds, other?
S App 8 - 7
Topic Response
2.8.2How will you access the counterpart funds? Are they drawn from
revenues coming directly to you or do you obtain them as government
transfers?
2.8.3How are payments made from the counterpart funds?
2.9 Will user charges that you receive as revenue is used to generate YES
counterpart funds? √NO
2.10 Will user charges that you receive as revenue is used to help finance the YES
ADB loan? √NO
2.11 Is part of the Project implemented by communities, project beneficiaries or YES describe arrangements
NGOs under your direction? If YES, describe reporting and monitoring √NO
arrangements that you have in place to track the use of project funds used
by these groups?
2.12 Are project beneficiaries under your direction required to contribute in the YES describe guidelines
form of labor to project costs? If YES, briefly describe guidelines and √NO
arrangements formulated to record and value the labor contribution?
3 Staffing
3.0 What is your agency’s organizational structure for accounting and finance?
Please attach an organization chart. 财组
预算人会计人出纳人审核人

员员员员
3.1 Identify key finance and accounting staffs including job title, responsibilities,
educational background and professional certification.
3.1.1 Job title Director of Financial Department
3.1.1.1 Staff Sun Hongguang
3.1.1.2 Main responsibilities Review and approval of accounting issues
3.1.1.3 Training and Certification Certified accountant
S App 8 - 8
Topic Response
3.1.2 Job title accountant
3.1.2.1 Staff Gu Jianqiang
3.1.2.2 Main responsibilities Accounting bookkeeping, financial report preparation
3.1.2.3 Training and Certification Accountant
3.1.3 Job title cashier
3.1.3.1 Staff Sun Yaying
3.1.3.2 Main responsibilities Cash keeping, daily bank deposit bookkeeping
3.1.3.3 Training and Certification accountant
3.1.4Job title
3.1.4.1 Staff
3.1.4.2 Main responsibilities
3.1.4.3 Training and Certification
3.1.5Job title
3.1.5.1 Staff
3.2 Attach job descriptions and CVs of key accounting staff. √job descriptions, CVs attached
job descriptions, CVs not attached
3.3 Is the project finance and accounting function staffed adequately? √YES
NO
3.4 Is the finance and accounts staff adequately qualified and experienced? √YES
NO
3.5 Are the project accounts and finance staff trained in ADB procedures? If NO, YES
what arrangements will be made for training? √NOdescribe training arrangements training for ADB’s financial
management, accounting and payment etc.
3.6 What is the duration of the work contract for project finance and accounts 2013-2020
staff?
S App 8 - 9
Topic Response
3.7 Indicate key project finance and accounts staff positions not filled yet, and Date ____ Position ______________
the estimated date of appointment. Date ____ Position ______________
Date ____ Position ______________
Date ____ Position ______________
Date ____ Position ______________
3.8 Does the Project have written position descriptions that clearly define duties, √YES
responsibilities, lines of supervision, and limits of authority for all of the NO
officers, managers, and staff?
3.9 At what frequency are personnel transferred? All accountants and financial staff are full time
3.10 What is training policy for the finance and accounting staff? Procedures and policies of ADB and upper level financial bureaus
4 Accounting Policies and Procedures
4.0 General
4.0.1Will the Project use your agency accounting system? Yes
4.0.2Describe how your agency accounting system will record project set up special subsidiary ledger, focus on business-related parties and
financial transactions. record the usage of each funds daily
4.0.3Describe how your agency accounting system will allocate project Expenses receipts enter into accounting subproject according to different
expenditures in accordance with the respective components, departments, cost allocation in accordance with departments and
disbursement categories, and sources of funds? categories.
4.0.4Describe controls in place to ensure that all transactions are correctly Account checking with clients every month, print of client confirmation slip,
made, adequately explained, prepared and approved. checking out the reasons immediately if having doubts, problems being
solved within one month.
4.0.5Will you have to change your chart of accounts to properly account for YES describe changes
and report on project activities and disbursement categories? If YES, √NO
describe the changes?
4.0.6Describe arrangements in place to ensure that cost allocations to the Strict review and approval procedures for costs, for the purpose of clearer
various funding sources will be made accurately and in accordance cost allocations.
with established agreements.
4.0.7Are the General Ledger and subsidiary ledgers reconciled and in √YES
balance? NO
4.0.8Are all accounting and supporting documents retained on a permanent √YES
S App 8 - 10
Topic Response
basis in a defined system that allows authorized users easy access? NO
4.0.9Describe the system for storing and accessing accounting documents Accounting documents and materials are archived, consulting is allowed for
and materials? designated personnel.
4.1 Segregation of Duties
4.1.1Who is responsible for the following duties (give name and title):
4.1.1.1 authorize execution of transactions Ren Lixin, Head of Finance Bureau
4.1.1.2 record transactions Gu, Jianqiang, member of Finance Bureau
4.1.1.3 maintain custody of assets involved in transaction Sun Yaying, member of Finance Bureau
4.1.2Are responsibilities for ordering, receiving, accounting for, and paying for √YES
goods and services separated? If NO, briefly describe how they are NO describe
not separated.
4.1.3Are bank reconciliations prepared by someone other than those who √YES
make or approve payments? NO
4.2 Budgeting System
4.2.1Are annual budgets based on physical and financial targets? YES – with financial targets only
√YES – with physical and financial targets
NO
4.2.2Are multiple year budgets and financing plans prepared for capital YES
expenditures? √NO
4.2.3Are separate budgets prepared for:
4.2.3.1 Individual departments? √YES
NO
4.2.3.2 Individual work units? YES
√NO
4.2.3.3 Distinct andsignificant functional activities (e.g. maintenance)? √YES
NO
4.2.3.4 All major capital projects? √ YES
NO
S App 8 - 11
Topic Response
4.2.4？Is there sufficient detail in annual budgets to provide a meaningful tool √YES
for performance monitoring? NO
4.2.5Are budgets used to monitor and control the performance of individual √YES
departments and units? NO
4.2.6How frequently are actual expenditures compared to the budget? √at least once every month
once every 2 to 3 months
never
4.2.7What happens if there are significant variations from the budget? Are Further explanation needed.
explanations required?
4.2.8Are approvals for variations from the budget required in advance or are yes
they obtained after the fact?
4.2.9Who is responsible for preparation and approval of budgets? Liu Lili
4.2.10 How are budgets prepared and approved? Annual budget is prepared according to budget law, and approved by
people’s congress.
4.2.11 Describe procedures used to plan project activities, collect prepare budget according to departments
information from units in charge of project components, and prepare
budgets?
4.2.12 What due diligence measures are there to assure that project plans Recruit budget experts to prepare, and invite review organizations to review
and budgets are based on valid assumptions, are developed by
knowledgeable individuals and are realistic?
4.3 Payments
4.3.1 During invoice-processing procedures are:
4.3.1.1 Copies of purchase orders and receiving reports obtained directly √YES
from issuing departments? NO
4.3.1.2 Comparison made of invoice quantities, prices and terms, with √YES
those indicated on the purchase order and with records of goods NO
actually received?
4.3.1.3 Comparison of invoice quantities with those indicated on the √YES
S App 8 - 12
Topic Response
receiving reports? NO
4.3.1.4 The accuracy of calculations checked? √YES
NO
4.3.2Are all invoices:
4.3.2.1 dated, reviewed and approved √YES
NO
4.3.2.2 stamped PAID upon payment √YES
NO
4.3.2.3 Marked for account code assignment? √YES
NO
4.3.3What controls exist for the preparation of the payroll? Pay roll is prepared by human resource department personnel with
separation of positions and staff
4.3.4How are changes to the payroll authorized? Signatures from main responsible person, deputy responsible person, and
human resource are required
4.4 Policies And Procedure
4.4.1What is the basis of accounting (e.g., cash, accrual)? cash basis
4.4.2What accounting standards are followed (PRC, ISA, other)? People’s Republic of China Accounting Standards
4.4.3Does the Project have an adequate policies and procedures manual to √YES
guide activities and ensure staff accountability? NO
4.4.4 Does the accounting policy and procedure manual need to be updated √YES explain how? Adjust by needs
for the project activities? If YES, explain how this will this be done? NO
4.4.5Are there written policies and procedures covering all routine financial √YES
management and related administrative activities? NO
4.4.6How are new accounting principles, policies or procedures implemented According to accounting system of state-owned construction unit
within your agency?
4.4.7Do procedures exist to ensure that only authorized persons can alter or √YES
establish a new accounting principle, policy or procedure to be used NO
by your agency?
4.4.8How do policies and procedures define conflict of interest and provide Coordinate with a transparent and fair manner
S App 8 - 13
Topic Response
safeguards to protect the organization from them?
4.4.9How do policies and procedures define related party transactions (real Related party transactions refer to the transactions with company or
and apparent)? subsidiary companies have direct or indirect stakes with our company.
4.4.10 What safeguards are there to protect the organization from conflict of Accounting reports preparation under accounting policies and institutions,
interest and related party transactions? establish internal and external audit systems.
4.4.11 Who has a copy of the policies and procedures manual? Leaders and all staff in financial department.
4.5 Cash and Bank
4.5.1Indicate names and positions of authorized signatories in the bank
accounts.
4.5.1.1 Name：Liu Fubiao Position：director of Baicheng Economic Development Zone
4.5.1.2 Name: Position:
4.5.1.4 Name Position
4.5.2Does the organization maintain an up-to-date cashbook, recording √YES
receipts and payments? NO
4.5.3What are the controls for the following activities:
4.5.3.1 collection of revenues Record in the subsidiary ledger according to the different capital source
4.5.3.2 timely deposit of receipts deposit of receipts on the day received
4.5.3.3 recording of receipts record the cash revenue in the subsidiary ledger
4.5.4How frequently are bank and cash reconciled on a monthly basis? √more frequently than monthly
every month
every quarter
less frequently than every quarter
4.5.5Are all unusual items on the bank reconciliation reviewed and approved √YES
by a responsible official? NO
4.5.6 How quickly are receipts deposited? the day it happens
S App 8 - 14
Topic Response
4.6 Safeguard over Assets
4.6.1Describe the system to record assets and protect them from fraud, waste Execution of interim measures for administration of state-owned assets.
and abuse? Establish fixed assets accounting, set up fixes assets consumption
subsidiary ledger, user sign, specially-assigned person manages ,
headman authorize
4.6.2Are subsidiary records of fixed assets and stocks kept up to date? √YES
NO
4.6.3Are subsidiary records of fixed assets and stocks reconciled with control √YES
accounts? NO
4.6.4 How often are physical inventories completed of fixed assets and √at least once a year
stocks? every 2 to 3 years
every 3 to 5 years
less frequently
never
4.6.5Are assets sufficiently covered by insurance policies? √YES
NO
4.7 Other Offices and Implementing Entities
4.7.1Identify other offices or implementing agencies or units under your
supervision or control that are responsible for project implementation
or finance?
4.7.2In relation to these other agencies, has the Project established controls
and procedures for:
4.7.2.1 flow of funds YES
NO
4.7.2.2 financial information YES
NO
4.7.2.3 accountability YES
NO
4.7.2.4 audits YES
NO
4.7.3How long does it take for project information to reach your agency from 5 days
S App 8 - 15
Topic Response
other offices or implementing agencies or units?
4.7.4What checks are there to ensure the accuracy of project information that
your agency receives from other offices or implementing agencies or
units.
4.7.5Are periodic reconciliations performed among the different offices and YES
implementing agencies? NO
4.8 Other
4.8.1Describe the options available to employees, beneficiaries and others for All employees, beneficiaries or others have the rights to report incidence of
reporting suspected fraud, waste or misuse of project resources or property fraud, waste and sabotage, to the local discipline bureau. Reward
property? the informer if the report is true.
4.8.2What measures has your agency taken to inform employees, Investigate any reported incidence of property fraud, waste and sabotage.
beneficiaries and others of their options for reporting suspected fraud, Relevant staff assume legal responsibility.
waste or misuse of project resources or property?
4.8.3Will representatives of the municipal discipline investigation bureau be √YES
involved in project bidding and construction activities? NO
4.8.4Do contracts let by your agency for civil works and other large √YES
procurements include anticorruption clauses and safeguards. NO
5 Reporting and Monitoring
5.0 Are financial statements prepared for your agency? If YES, what accounting √YES accounting standards? The accounting system of state-owned
standards are they based on? construction units
NO
5.1 How often are financial statements prepared? monthly report
5.2 How quickly are the financial statements prepared at year end? weekly
5.3 Are separate financial statements prepared for the office or unit in your √YES
agency that will implement the Project? NO
5.4 Will the financial reporting system need to be adapted to report on the √YES
project components? NO
5.5 Does the reporting system have the capacity to link financial information with √YES
information on the physical progress of engineering project's? NO
S App 8 - 16
Topic Response
5.6 Describe procedures and controls used to insure that the physical project establish project management rules and accounting system to ensure the
data can be compared and coordinated with the financial data? consistency between project implementation and financial data
5.7 Are there financial management reporting requirements for existing yes
engineering projects that specify:
5.7.1what reports are to be prepared prepare financial statement: project budget, project progress, loan
utilization progress, Balance sheet, summary of sources and uses of funds
by project component and statement of implementation of loan agreement
5.7.2what the reports are to contain project pricing, project progress, fund use etc.
5.7.3how the reports are to be used provide information on project progress, quality and use of funds.
5.8 What information do the financial management reports for engineering √ Total project expenditures to date
projects contain? (check all that apply) √ Comparison of actual expenditures with budgets
√ Comparison of actual expenditures with work completed
√ Expenditures by project component
√ Explanations of significant variances of expenditures from budgets
5.9 Are financial management reports used by management? √YES
NO
5.10 Describe a recent action taken by management in response to information 紧项目实施前的各项准备工作 Check whether the capital expenditure
provided in a financial management report? corresponds with actual engineering progress in response to the
information provided and conduct supervision and adjustment in time
5.11 Are financial reports prepared directly by the automated accounting system prepared by an automated accounting system
or are they prepared by spreadsheets or some other manual method? √prepared by spreadsheets or other method
both ways used
6 Internal Audit
6.0 Is there an internal auditor or audit department in your agency? YES  answer questions 6.1 to 6.5
√NO  go to section 7
6.1 What are the qualifications and experience of audit department staff?
6.2 To whom does the internal auditor report?
6.3 Will the internal audit department include the Project in its work program?
6.4 Are actions taken on the internal audit findings? YES
S App 8 - 17
Topic Response
NO
6.5 Describe the most recent actions taken in response to the internal audit
findings?
7 External Audit
7.0 Is your agency financial statement audited each year by an independent √YES Who: Baicheng Audit Bureau
non-government auditor? If YES, who is the auditor?
NO
7.1 How soon following the financial yearend are audit reports issued? issue the audit report one month after financial year-end
7.2 Is the audit of your agency conducted according to International Standards YES
on Auditing? √NO
7.3 Were any major accountability issues identified in audit reports over the past YES
three years? √NO
7.4 Will your agency auditor audit the Project financial statements and accounts agency auditor
or will another auditor be appointed? √ another auditor
7.5 Has your agency implemented all recommendations made by the auditors in YES
audit reports or management letters over the past three years? If NO, √NO explain project has not started yet
please explain.
7.6 Is the Project subject to any kind of audit from an independent governmental YESWho:
entity (e.g., the supreme audit institution) in addition to the external audit? √NO
If YES, who is the independent entity?
7.7 Does your agency have separate terms of reference for annual audits of YES
major projects? √NO
7.8 Please provide the audit reports for the past three years.  Provided
√ Not provided – please give reason: project has not started yet
8 Information Systems
8.0 Is the financial management system computerized? √YES

NO
8.1 Can the system produce the necessary project financial reports? √YES
S App 8 - 18
Topic Response
NO
8.2 What training has the staff received to operate the system? training for financial software
8.3 What controls are there to safeguard the confidentiality, integrity and Set permission and password according to department personnel. Paper
availability of data in the information system? archive and electric data archive
S App 8 - 19
Responses to the Financial Management Assessment Questionnaire – Baishan Solid Waste Disposal Company
Topic Response
Name of agency Baishan Solid Waste Disposal Co. Ltd.
Project component that agency is responsible for Baishan ISWM
Name of person responsible for filling this form Dong, Wenyuan
Position and title of person responsible for filling this form Office worker
Nature of agency’s responsibility for the Project (check all that apply)  Provide counterpart funding
Sign a follow on loan contract for ADB funds
√Management of project construction
Management of contributions from NGOs or project beneficiaries
√Project operation and maintenance
√Financial management of project
Generate funds from tariffs, taxes or other sources to service the ADB loan
√Other – describe
1.0 What is your agency’s legal status and registration? Limited Company
Registration Capital: 8 million
Register number: 220600000009781
1.1 What is your agency’s governing body? Baishan Housing and Urban Construction Bureau
1.2 What is the governing body’s relationship to the Government? subordinate
1.3 Can the governing body make decisions independently of √YES
Government? If NO, please explain what decisions need government NO explain:
approval.
1.4 Has your agency implemented an externally-financed project in the YES briefly describe
past? If yes, please provide details?
√NO
1.5 What are the statutory reporting requirements for your agency with prepare financial report in accordance with the accounting law and enterprise
respect to finance? accounting system
1.6 Describe your agency’s organizational structure? (please attach an √Organization chart attached
S App 8 - 20
Topic Response
organization chart)  Organization chart not attached
1.7 Is the organizational structure appropriate for the needs of the To strengthen the management of construction projects
Project?
1.8 Has or will your agency established a project management office? YES, already have project office
√YES, will set up project office
NO
1.9 If the ADB loan is approved, what staffing changes will you make to Our unit will deploy professional personnel who meet requirements and they will
assist with project implementation? in charge of construction site management supervision and operation
management.
1.10 Does the Project have written job descriptions that define duties, YES – have already prepared these (attach job descriptions for the top two
responsibilities, lines of supervision, and limits of authority for staff? positions)
√ Written job descriptions are being or will be prepared
NO

2.0 Describe proposed project funds flow arrangements. Include a chart ADB Loan: ADB →Ministry of Finance → Jilin Provincial Finance Bureau
and explanation of the flow of funds from ADB, government and other →Baishan Municipal Finance Bureau →Contractor/Supplier
financiers to each lower level that will receive funds. Counterpart Fund: Baishan Municipal Finance Bureau –Baishan Solid Waste
Disposal company →Contractor/Supplier
2.1 Are the (proposed) arrangements to transfer the proceeds of the loan YES
from the government to the implementing agency satisfactory? NO briefly explain why not
√ Not applicable
2.2 Describe any past problems experienced in receiving investment No problem
funds from funding sources?
2.3 Describe proposed on-lending arrangements from the Government Not applicable
to your agency, including on-lending terms and conditions.
2.4 Will your agency use an imprest account to manage ADB funds? If √YES name of bank China Agricultural Bank
YES, in which bank will the Imprest Account be opened? NO
2.5 Does your agency have experience in the management of no experience
disbursements from ADB?
2.6 Does your agency have experience managing foreign exchange YES
risks? √NO
S App 8 - 21
Topic Response
2.7 Will your agency need to develop capacity to manage foreign  YES.  Explain capacity building arrangements: Training on how to reduce
exchange risks? If yes, what arrangements have been made to risk of exchange rate and interest rate
develop this capacity? √ NO
2.8 Is your agency is responsible for providing counterpart funds? If YES YES answer questions 2.8.1 to 2.8.3
answer the next 3 questions. √NO
2.8.1 What is the source of the counterpart funds: revenues generated
by your business activity, government tax funds, other?
2.8.2 How will you access the counterpart funds? Are they drawn from
revenues coming directly to you or do you obtain them as
government transfers?
2.8.3 How are payments made from the counterpart funds?
2.10 Will user charges that you receive as revenue is used to help finance √YES
the ADB loan? NO
2.11 Is part of the Project implemented by communities, project YES describe arrangements
beneficiaries or NGOs under your direction? If YES, describe √NO
reporting and monitoring arrangements that you have in place to
track the use of project funds used by these groups?
2.12 Are project beneficiaries under your direction required to contribute in YES describe guidelines
the form of labor to project costs? If YES, briefly describe guidelines √NO
and arrangements formulated to record and value the labor
contribution?
3 Staffing
S App 8 - 22
Topic Response
3.0 What is your agency’s organizational structure for accounting and
项目办主任
finance? Please attach an organization chart.
财部部长
会计出纳
3.1 Identify key finance and accounting staffs including job title,
responsibilities, educational background and professional
certification.
3.1.1.1 Staff 1
3.1.1.2 Main responsibilities 1. Verify the accounting report; 2. Conduct enterprise economic activity analysis;
3. Prepare enterprise financial budget and daily review; 4. Organize enterprise
cost management, reduce enterprise cost; 5. Manage enterprise financial
system; 6. Deploy enterprise operation funds; 7. Finance for enterprise
production and development; 8. Prepare enterprise tax planning; 9. Participate
in the enterprise investment decision-making; 10. Coordinate financial relation
between different aspects.
3.1.1.3 Training and Certification Assistant accountant
3.1.2.1 Staff 1
3.1.2.2 Main responsibilities 1. Responsible for recording financial general ledger and all kinds of detail
account. Complete formalities, accurate number, net writing, prompt registration
and clear account.
2. Responsible for preparing monthly final accounts, quarter final accounts,
annual final accounts and related reports on other aspects
3. Assist manager to prepare and implement institute budget.
S App 8 - 23
Topic Response
4. Verify original certificates carefully, refuse to entry these certificates violating
regulations and unqualified into account. Control expenses scope and expenses
standards strictly.
5. Verify fixed assets accounts regularly, make the accounts and assets
consistent.
6. Responsible for providing data and reporting situation when superior financial
authorities inspect performance.
7. Report financial conditions to manager in written form every month serve as
manager adviser and perform the financial supervision.
8. Bind accounting document, accounting book and statistical forms etc.
regularly, keep and archive carefully. Same year’s accounting archives are kept
by the accountant; former accounting archives are kept by school account room.
9. Assist the cashier with payment and bonus issue
10. Responsible for keeping financial seal and controlling the sign and issue of
check
11. Fill in auditing statement regularly, self-check carefully and submitting the
financial materials
3.1.3 Job title cashier
3.1.3.1 Staff 1
3.1.3.2 Main responsibilities 1. Prepare cash receipt and settlement service; 2. Register cash and bank
deposit journal; 3. Keep stock cash and various negotiable securities; 4. keep
related seal, blank receipt and blank check

3.1.4 Job title
3.1.4.1 Staff
3.1.5 Job title
3.1.5.1 Staff
S App 8 - 24
Topic Response
3.2 Attach job descriptions and CVs of key accounting staff. √job descriptions, CVs attached
job descriptions, CVs not attached
NO
3.4 Is the finance and accounts staff adequately qualified and YES
experienced? √NO
3.5 Are the project accounts and finance staff trained in ADB YES
procedures? If NO, what arrangements will be made for training? √NOdescribe training arrangements training for ADB’s financial management,
accounting and payment etc.
3.6 What is the duration of the work contract for project finance and 2013-2020
accounts staff?
3.7 Indicate key project finance and accounts staff positions not filled yet, Date ____ Position ______________
and the estimated date of appointment. Date ____ Position ______________
Date ____ Position ______________
Date ____ Position ______________
Date ____ Position ______________
3.8 Does the Project have written position descriptions that clearly define √YES
duties, responsibilities, lines of supervision, and limits of authority for NO
all of the officers, managers, and staff?
3.9 At what frequency are personnel transferred? NO
3.10 What is training policy for the finance and accounting staff? The financial staff attends the training programs organized by Department of
Finance.

4.0 General
4.0.1 Will the Project use your agency accounting system? yes
4.0.2 Describe how your agency accounting system will record project set up special subsidiary ledger, focus on business-related parties and record
financial transactions. the usage of each funds daily
S App 8 - 25
Topic Response
4.0.3 Describe how your agency accounting system will allocate Expenses receipts enter into accounting subproject according to different
project expenditures in accordance with the respective departments, cost allocation in accordance with departments and categories.
components, disbursement categories, and sources of funds?
4.0.4 Describe controls in place to ensure that all transactions are Account checking with clients every month, print of client confirmation slip,
correctly made, adequately explained, prepared and approved. checking out the reasons immediately if having doubts, problems being solved
within one month.
4.0.5 Will you have to change your chart of accounts to properly YES describe changes
account for and report on project activities and disbursement √NO
categories? If YES, describe the changes?
4.0.6 Describe arrangements in place to ensure that cost allocations to Cost enters according to accounting subject, subject in accordance with
the various funding sources will be made accurately and in department.
accordance with established agreements.
4.0.7 Are the General Ledger and subsidiary ledgers reconciled and in √YES
balance? NO
4.0.8 Are all accounting and supporting documents retained on a √YES
permanent basis in a defined system that allows authorized NO
users easy access?
4.0.9 Describe the system for storing and accessing accounting Archived for 10 years, consulting is not allowed without special approval from
documents and materials? general manager.
4.1.1 Who is responsible for the following duties (give name and title): Dong Wenyan, Director
4.1.1.1 authorize execution of transactions
4.1.1.2 record transactions
4.1.1.3 maintain custody of assets involved in transaction
4.1.2 Are responsibilities for ordering, receiving, accounting for, and √YES
paying for goods and services separated? If NO, briefly describe NO describe
how they are not separated.
4.1.3 Are bank reconciliations prepared by someone other than those √YES
who make or approve payments? NO
S App 8 - 26
Topic Response
4.2.1 Are annual budgets based on physical and financial targets? YES – with financial targets only
NO
4.2.2 Are multiple year budgets and financing plans prepared for YES
capital expenditures? √NO
4.2.3 Are separate budgets prepared for:
NO
4.2.3.2 Individual work units? √YES
NO
4.2.3.3 Distinct andsignificant functional activities (e.g. √YES
maintenance)? NO
NO
4.2.4 ？Is there sufficient detail in annual budgets to provide a √YES
meaningful tool for performance monitoring? NO
4.2.5 Are budgets used to monitor and control the performance of √YES
individual departments and units? NO
4.2.6 How frequently are actual expenditures compared to the budget? at least once every month
√once every 6 to 12 months
never
4.2.7 What happens if there are significant variations from the budget? Strictly follow the budget.
Are explanations required?
4.2.8 Are approvals for variations from the budget required in advance yes
or are they obtained after the fact?
4.2.9 Who is responsible for preparation and approval of budgets? Municipal government, municipal congress
4.2.10 How are budgets prepared and approved? Formation: submit annual budget formation according to departments
Approval: approved by municipal congress.
S App 8 - 27
Topic Response
4.2.11 Describe procedures used to plan project activities, collect
information from units in charge of project components, and
prepare budgets?
4.2.12 What due diligence measures are there to assure that project
plans and budgets are based on valid assumptions, are
developed by knowledgeable individuals and are realistic?
4.3 Payments
4.3.1.1 Copies of purchase orders and receiving reports obtained √YES
directly from issuing departments? NO
4.3.1.2 Comparison made of invoice quantities, prices and terms, √YES
with those indicated on the purchase order and with records NO
of goods actually received?
NO
4.3.2 Are all invoices:
NO
NO
NO
4.3.3 What controls exist for the preparation of the payroll? Currently the PMO staff is taken care by individual units
4.3.4 How are changes to the payroll authorized? N/A.
4.4.1 What is the basis of accounting (e.g., cash, accrual)? accrual basis
4.4.2 What accounting standards are followed (PRC, ISA, other)? People’s Republic of China Accounting Standards
S App 8 - 28
Topic Response
4.4.3 Does the Project have an adequate policies and procedures YES
manual to guide activities and ensure staff accountability? √NO
4.4.4 Does the accounting policy and procedure manual need to be √YES explain how? Depends on the progress of the construction project
updated for the project activities? If YES, explain how this will NO
this be done?
4.4.5 Are there written policies and procedures covering all routine √YES
financial management and related administrative activities? NO
4.4.6 How are new accounting principles, policies or procedures Financial department makes the account in accordance with new accounting
implemented within your agency? system; each department conducts it according to regulation and procedure.
4.4.7 Do procedures exist to ensure that only authorized persons can √YES
alter or establish a new accounting principle, policy or procedure NO
to be used by your agency?
4.4.8 How do policies and procedures define conflict of interest and Each department proposes rules and regulations, which can be carried out if
provide safeguards to protect the organization from them? approved in management conference.
4.4.9 How do policies and procedures define related party transactions Related party transactions refer to the trade between company or underlying
(real and apparent)? company and related parties which have links in vested interests and stakes
directly and indirectly with our company.
4.4.10 What safeguards are there to protect the organization from Sign contract with related parties and explicit creditor’s rights and debts.
conflict of interest and related party transactions?
4.4.11 Who has a copy of the policies and procedures manual? All staff in financial department.
4.5 Cash and Bank
4.5.1 Indicate names and positions of authorized signatories in the Li Hong, Cashier
bank accounts.
4.5.1.1 Nam： Position：
4.5.2 Does the organization maintain an up-to-date cashbook, √YES
S App 8 - 29
Topic Response
recording receipts and payments? NO
4.5.3 What are the controls for the following activities:
4.5.3.1 collection of revenues
Record in the subsidiary ledger according to the different capital source
4.5.3.2 timely deposit of receipts deposit of receipts on the day received
4.5.3.3 recording of receipts record the cash revenue in the subsidiary ledger
4.5.4 How frequently are bank and cash reconciled on a monthly more frequently than monthly
basis? √ every month
every quarter
4.5.5 Are all unusual items on the bank reconciliation reviewed and √YES
approved by a responsible official? NO
4.6.1 Describe the system to record assets and protect them from Execution of interim measures for administration of state-owned assets.
fraud, waste and abuse? Establish fixed assets accounting, set up fixes assets consumption subsidiary
ledger, user sign, specially-assigned person manages , headman authorize
4.6.2 Are subsidiary records of fixed assets and stocks kept up to √YES
date? NO
4.6.3 Are subsidiary records of fixed assets and stocks reconciled with √YES
control accounts? NO
4.6.4 How often are physical inventories completed of fixed assets √at least once a year
and stocks? every 2 to 3 years
less frequently
never
4.6.5 Are assets sufficiently covered by insurance policies? YES
√NO
S App 8 - 30
Topic Response
4.7.1 Identify other offices or implementing agencies or units under
your supervision or control that are responsible for project
implementation or finance?
4.7.2 In relation to these other agencies, has the Project established
controls and procedures for:
4.7.2.1 flow of funds √YES
NO
4.7.2.2 financial information √YES
NO
4.7.2.3 accountability √YES
NO
4.7.2.4 audits √YES
NO
4.7.3 How long does it take for project information to reach your 5 days
agency from other offices or implementing agencies or units?
4.7.4 What checks are there to ensure the accuracy of project Strict content management system, clear labor division system and adequate
information that your agency receives from other offices or supporting documents
implementing agencies or units.
4.7.5 Are periodic reconciliations performed among the different √YES
offices and implementing agencies? NO
4.8 Other
4.8.1 Describe the options available to employees, beneficiaries and 1, set a fixed box; 2, announced the telephone; 3, direct interview system
others for reporting suspected fraud, waste or misuse of project
resources or property?
4.8.2 What measures has your agency taken to inform employees, specially-assigned personnel are responsible for it
beneficiaries and others of their options for reporting suspected
fraud, waste or misuse of project resources or property?
4.8.3 Will representatives of the municipal discipline investigation √YES
bureau be involved in project bidding and construction activities? NO
4.8.4 Do contracts let by your agency for civil works and other large √YES
S App 8 - 31
Topic Response

5.0 Are financial statements prepared for your agency? If YES, what √YES accounting standards?
accounting standards are they based on?
NO
5.1 How often are financial statements prepared? monthly report
5.2 How quickly are the financial statements prepared at year end? Ten days
5.3 Are separate financial statements prepared for the office or unit in YES
your agency that will implement the Project? √NO
5.4 Will the financial reporting system need to be adapted to report on √YES
the project components? NO
5.5 Does the reporting system have the capacity to link financial √YES
information with information on the physical progress of engineering NO
project's?
5.6 Describe procedures and controls used to insure that the physical Financial personnel participate in the full process of project management,
project data can be compared and coordinated with the financial engineering project managers and financial personnel should ensure the timely
data? delivery of engineering information and accuracy of verification.
5.7 Are there financial management reporting requirements for existing
5.7.1 what reports are to be prepared prepare financial statement: Balance sheet, summary of sources and uses of
funds by project component and statement of implementation of loan agreement
5.7.2 what the reports are to contain Capital source conditions, capital consumption conditions and project
construction progress
5.7.3 how the reports are to be used provide information for enterprise’s internal and external managers
5.8 What information do the financial management reports for √ Total project expenditures to date
engineering projects contain? (check all that apply) √ Comparison of actual expenditures with budgets
S App 8 - 32
Topic Response
NO
5.10 Describe a recent action taken by management in response to Check whether the capital expenditure corresponds with actual engineering
information provided in a financial management report? progress in response to the information provided and conduct supervision and
adjustment in time
5.11 Are financial reports prepared directly by the automated accounting prepared by an automated accounting system
system or are they prepared by spreadsheets or some other manual √prepared by spreadsheets or other method
method? both ways used
6 Internal Audit
6.0 Is there an internal auditor or audit department in your agency?  YES  answer questions 6.1 to 6.5
√ NO  go to section 7

6.3 Will the internal audit department include the Project in its work
program?
NO
6.5 Describe the most recent actions taken in response to the internal
audit findings?
7 External Audit
7.0 Is your agency financial statement audited each year by an √ YES Who:
independent non-government auditor? If YES, who is the auditor?
NO
7.1 How soon following the financial yearend are audit reports issued?
7.2 Is the audit of your agency conducted according to International YES
Standards on Auditing? √NO
7.3 Were any major accountability issues identified in audit reports over YES
the past three years? √NO
S App 8 - 33
Topic Response
7.4 Will your agency auditor audit the Project financial statements and agency auditor
accounts or will another auditor be appointed? √ another auditor
7.5 Has your agency implemented all recommendations made by the √YES
auditors in audit reports or management letters over the past three NO explain
years? If NO, please explain.
7.6 Is the Project subject to any kind of audit from an independent √YESWho: Baishan audit bureau
governmental entity (e.g., the supreme audit institution) in addition to
the external audit? If YES, who is the independent entity? NO
7.7 Does your agency have separate terms of reference for annual YES
audits of major projects? √NO
7.8 Please provide the audit reports for the past three years. √ Provided
 Not provided – please give reason
8.0 Is the financial management system computerized? YES
√NO
8.1 Can the system produce the necessary project financial reports? YES
√NO
8.2 What training has the staff received to operate the system?
8.3 What controls are there to safeguard the confidentiality, integrity and
availability of data in the information system?
S App 8 - 34
Responses to the Financial Management Assessment Questionnaire – Baishan Xibeicha Qiyuan Hydropower Co. Ltd.
Topic Response
Name of agency Baishan Xibeicha Qiyuan Hydropower Co. Ltd. (BXQHC)
Project component that agency is responsible for Baishan Improved Water Supply System
Name of person responsible for filling this form An Minhua
Position and title of person responsible for filling this form Head of financial department
Nature of agency’s responsibility for the Project (check all that apply)  Provide counterpart funding
Sign a follow on loan contract for ADB funds
Management of project construction
Management of contributions from NGOs or project beneficiaries
Project operation and maintenance
Financial management of project
 Generate funds from tariffs, taxes or other sources to service the ADB loan
Other – describe Assist in the management
1.0 What is your agency’s legal status and registration? Baishan Xibeicha Qiyuan Hydropower Co. Ltd.
1.1 What is your agency’s governing body? Baishan Water Affairs Bureau
1.2 What is the governing body’s relationship to the Government? Subordinate
1.3 Can the governing body make decisions independently of Government? YES
If NO, please explain what decisions need government approval. √NO explain: governmental function unit
1.4 Has your agency implemented an externally-financed project in the YES briefly describe
past? If yes, please provide details?
√NO
1.5 What are the statutory reporting requirements for your agency with Prepare annual financial report according to accounting law and enterprise
respect to finance? accounting system
1.6 Describe your agency’s organizational structure? (please attach an Organization chart attached
organization chart) Organization chart not attached
1.7 Is the organizational structure appropriate for the needs of the Project? Yes, but lack of experience of foreign funded projects. Needs to strengthen
capacity
S App 8 - 35
Topic Response
1.8 Has or will your agency established a project management office? YES, already have project office
√YES, will set up project office
NO
1.9 If the ADB loan is approved, what staffing changes will you make to Deployed personnel to assist the implementation of the project
assist with project implementation?
1.10 Does the Project have written job descriptions that define duties, YES – have already prepared these (attach job descriptions for the top two
responsibilities, lines of supervision, and limits of authority for staff? positions)
√Written job descriptions are being or will be prepared
NO
2.0 Describe proposed project funds flow arrangements. Include a chart ADB Loan: ADB →Ministry of Finance → Jilin Provincial Finance Bureau
and explanation of the flow of funds from ADB, government and other →Baishan Municipal Finance Bureau →Baishan Water Affair Bureau
financiers to each lower level that will receive funds. →BXQHC→Contractor/Supplier
Counterpart Fund: Baishan Municipal Finance Bureau –Contractor/Supplier
2.1 Are the (proposed) arrangements to transfer the proceeds of the loan YES
from the government to the implementing agency satisfactory? NO briefly explain why not
√ Not applicable
2.2 Describe any past problems experienced in receiving investment funds No problem
from funding sources?
2.3 Describe proposed on-lending arrangements from the Government to Not applicable
your agency, including on-lending terms and conditions.
2.4 Will your agency use an imprest account to manage ADB funds? If √YES name of bank Jilin Bank
YES, in which bank will the Imprest Account be opened? NO
2.5 Does your agency have experience in the management of no experience
disbursements from ADB?
2.6 Does your agency have experience managing foreign exchange risks? YES
√NO
2.7 Will your agency need to develop capacity to manage foreign exchange  YES. 
risks? If yes, what arrangements have been made to develop this √ NO
capacity?
S App 8 - 36
Topic Response
2.8 Is your agency is responsible for providing counterpart funds? If YES YES answer questions 2.8.1 to 2.8.3
answer the next 3 questions. √NO
2.8.1What is the source of the counterpart funds: revenues generated by
your business activity, government tax funds, other?
2.8.2How will you access the counterpart funds? Are they drawn from
revenues coming directly to you or do you obtain them as
government transfers?
2.8.3How are payments made from the counterpart funds?
2.10 Will user charges that you receive as revenue is used to help finance YES
the ADB loan? √NO
2.11 Is part of the Project implemented by communities, project beneficiaries YES describe arrangements
or NGOs under your direction? If YES, describe reporting and √NO
monitoring arrangements that you have in place to track the use of
project funds used by these groups?
2.12 Are project beneficiaries under your direction required to contribute in YES describe guidelines
the form of labor to project costs? If YES, briefly describe guidelines √NO
and arrangements formulated to record and value the labor
contribution?
3 Staffing
3.0 What is your agency’s organizational structure for accounting and attached
finance? Please attach an organization chart.
3.1 Identify key finance and accounting staffs including job title,
responsibilities, educational background and professional
certification.
3.1.1.1 Staff 1
3.1.1.2 Main responsibilities 1. Verify the accounting report; 2. Conduct enterprise economic activity analysis;
3. Prepare enterprise financial budget and daily review; 4. Organize enterprise
S App 8 - 37
Topic Response
cost management, reduce enterprise cost; 5. Manage enterprise financial
system; 6. Deploy enterprise operation funds; 7. Finance for enterprise
production and development; 8. Prepare enterprise tax planning; 9. Participate
in the enterprise investment decision-making; 10. Coordinate financial relation
between different aspects.
3.1.1.3 Training and Certification Assistant accountant
3.1.2.1 Staff 1
3.1.2.2 Main responsibilities 1. Responsible for recording financial general ledger and all kinds of detail
account. Complete formalities, accurate number, net writing, prompt registration
and clear account.
2. Responsible for preparing monthly final accounts, quarter final accounts,
annual final accounts and related reports on other aspects
3. Assist manager to prepare and implement institute budget.
4. Verify original certificates carefully, refuse to entry these certificates violating
regulations and unqualified into account. Control expenses scope and expenses
standards strictly.
3.1.3 Job title Cashier
3.1.3.1 Staff
3.1.3.2 Main responsibilities Cashier

3.1.4Job title statisticians
3.1.4.1 Staff Lihuizhu
3.1.4.2 Main responsibilities Report statistics
3.1.5Job title statisticians
3.1.5.1 Staff Zhengjuanli
S App 8 - 38
Topic Response
3.1.5.2 Main responsibilities Financial statistics
3.2 Attach job descriptions and CVs of key accounting staff. job descriptions, CVs attached
√ job descriptions, CVs not attached
NO
3.4 Is the finance and accounts staff adequately qualified and experienced? √YES
NO
3.5 Are the project accounts and finance staff trained in ADB procedures? If YES
NO, what arrangements will be made for training? √NOdescribe training arrangements training for ADB’s financial management,
accounting and payment etc.
3.6 What is the duration of the work contract for project finance and 2013-2020
accounts staff?
3.7 Indicate key project finance and accounts staff positions not filled yet, Date ____ Position ______________
and the estimated date of appointment. Date ____ Position ______________
Date ____ Position ______________
Date ____ Position ______________
Date ____ Position ______________
3.8 Does the Project have written position descriptions that clearly define √YES
duties, responsibilities, lines of supervision, and limits of authority for NO
all of the officers, managers, and staff?
3.9 At what frequency are personnel transferred? NO
3.10 What is training policy for the finance and accounting staff? The financial staff attends the annual training programs organized by Municipal
Finance bureau
4.0 General
4.0.1Will the Project use your agency accounting system? yes
4.0.2Describe how your agency accounting system will record project set up special subsidiary ledger, focus on business-related parties and record
financial transactions. the usage of each funds daily
S App 8 - 39
Topic Response
4.0.3Describe how your agency accounting system will allocate project Expenses receipts enter into accounting subproject according to different
expenditures in accordance with the respective components, departments, cost allocation in accordance with departments and categories.
disbursement categories, and sources of funds?
4.0.4Describe controls in place to ensure that all transactions are Account checking with clients every month, print of client confirmation slip,
correctly made, adequately explained, prepared and approved. checking out the reasons immediately if having doubts, problems being solved
within one month.
4.0.5Will you have to change your chart of accounts to properly account YES describe changes
for and report on project activities and disbursement categories? √NO
If YES, describe the changes?
4.0.6Describe arrangements in place to ensure that cost allocations to Cost enters according to accounting subject, subject in accordance with
the various funding sources will be made accurately and in department.
accordance with established agreements.
4.0.7Are the General Ledger and subsidiary ledgers reconciled and in √YES
balance? NO
4.0.8Are all accounting and supporting documents retained on a √YES
permanent basis in a defined system that allows authorized NO
users easy access?
4.0.9Describe the system for storing and accessing accounting Archived for 10 years, consulting is not allowed without special approval from
documents and materials? general manager.
4.1.1Who is responsible for the following duties (give name and title):
4.1.1.1 authorize execution of transactions An Minhua Director
4.1.1.2 record transactions
4.1.1.3 maintain custody of assets involved in transaction Yue Chunxu accountant
4.1.2Are responsibilities for ordering, receiving, accounting for, and √YES
paying for goods and services separated? If NO, briefly describe NO describe
how they are not separated.
4.1.3Are bank reconciliations prepared by someone other than those √YES
who make or approve payments? NO
S App 8 - 40
Topic Response
4.2.1Are annual budgets based on physical and financial targets? YES – with financial targets only
NO
4.2.2Are multiple year budgets and financing plans prepared for capital YES
expenditures? √NO
4.2.3Are separate budgets prepared for:
NO
4.2.3.2 Individual work units? √YES
NO
4.2.3.3 Distinct andsignificant functional activities (e.g. √YES
maintenance)? NO
NO
4.2.4？Is there sufficient detail in annual budgets to provide a meaningful √YES
tool for performance monitoring? NO
4.2.5Are budgets used to monitor and control the performance of √YES
individual departments and units? NO
4.2.6How frequently are actual expenditures compared to the budget? √at least once every month
 once every 2 to 3 months
never
4.2.7What happens if there are significant variations from the budget? yes
Are explanations required?
4.2.8Are approvals for variations from the budget required in advance or yes
are they obtained after the fact?
4.2.9Who is responsible for preparation and approval of budgets? Preparation: accountant
Approval: general manager
4.2.10 How are budgets prepared and approved? preparation: according to the annual/monthly budget submitted by all
S App 8 - 41
Topic Response
departments
Approval: approved by general manager on the basis of budget, overspending
needs interpretation.
4.2.11 Describe procedures used to plan project activities, collect prepare budget according to departments
information from units in charge of project components, and
prepare budgets?
4.2.12 What due diligence measures are there to assure that project The personnel who in charge of project implementation and budget execution
plans and budgets are based on valid assumptions, are participate in the project preparation.
developed by knowledgeable individuals and are realistic?
4.3 Payments
4.3.1.1 Copies of purchase orders and receiving reports obtained √YES
directly from issuing departments? NO
4.3.1.2 Comparison made of invoice quantities, prices and terms, √YES
with those indicated on the purchase order and with records NO
of goods actually received?
NO
4.3.2Are all invoices:
NO
NO
NO
4.3.3What controls exist for the preparation of the payroll? Pay list is prepared by human resource department personnel and verified by
financial department.
4.3.4How are changes to the payroll authorized? Change request proposed by human resource department, verified by financial
S App 8 - 42
Topic Response
department, approved by general manager.
4.4.1What is the basis of accounting (e.g., cash, accrual)? accrual basis
4.4.2What accounting standards are followed (PRC, ISA, other)? People’s Republic of China Accounting Standards
4.4.3Does the Project have an adequate policies and procedures manual √YES
to guide activities and ensure staff accountability? NO
4.4.4Does the accounting policy and procedure manual need to be YES explain how?
updated for the project activities? If YES, explain how this will √ NO
this be done?
4.4.5Are there written policies and procedures covering all routine √YES
financial management and related administrative activities? NO
4.4.6How are new accounting principles, policies or procedures Financial department makes the account in accordance with new accounting
implemented within your agency? system; each department conducts it according to regulation and procedure.
4.4.7Do procedures exist to ensure that only authorized persons can √YES
alter or establish a new accounting principle, policy or procedure NO
to be used by your agency?
4.4.8How do policies and procedures define conflict of interest and Each department proposes rules and regulations, which can be carried out if
provide safeguards to protect the organization from them? approved in management conference.
4.4.9How do policies and procedures define related party transactions Related party transactions refer to the trade between company or underlying
(real and apparent)? company and related parties which have links in vested interests and stakes
directly and indirectly with our company.
4.4.10 What safeguards are there to protect the organization from Sign contract with related parties and explicit creditor’s rights and debts.
conflict of interest and related party transactions?
4.4.11 Who has a copy of the policies and procedures manual? All staff in financial department.
4.5 Cash and Bank
4.5.1Indicate names and positions of authorized signatories in the bank
accounts.
4.5.1.1 Name：Feng Limin Position：general manager
S App 8 - 43
Topic Response
4.5.2Does the organization maintain an up-to-date cashbook, recording √YES
receipts and payments? NO
4.5.3What are the controls for the following activities:
4.5.3.1 collection of revenues
Telephone and internet confirmation
4.5.3.2 timely deposit of receipts yes
4.5.3.3 recording of receipts yes
4.5.4How frequently are bank and cash reconciled on a monthly basis? more frequently than monthly
√ every month
every quarter
4.5.5Are all unusual items on the bank reconciliation reviewed and √YES
approved by a responsible official? NO
4.6.1Describe the system to record assets and protect them from fraud, Execution of interim measures for administration of state-owned assets.
waste and abuse? Establish fixed assets accounting, set up fixes assets consumption subsidiary
ledger, user sign, specially-assigned person manages,
4.6.2Are subsidiary records of fixed assets and stocks kept up to date? √YES
NO
4.6.3Are subsidiary records of fixed assets and stocks reconciled with √YES
control accounts? NO
4.6.4 How often are physical inventories completed of fixed assets and √at least once a year
stocks? every 2 to 3 years
less frequently
S App 8 - 44
Topic Response
never
4.6.5Are assets sufficiently covered by insurance policies? YES
√NO
4.7.1Identify other offices or implementing agencies or units under your
supervision or control that are responsible for project
implementation or finance?
4.7.2In relation to these other agencies, has the Project established
controls and procedures for:
4.7.2.1 flow of funds √YES
NO
4.7.2.2 financial information √YES
NO
4.7.2.3 accountability √YES
NO
4.7.2.4 audits √YES
NO
4.7.3How long does it take for project information to reach your agency same day
from other offices or implementing agencies or units?
4.7.4What checks are there to ensure the accuracy of project information Project on-site supervision
that your agency receives from other offices or implementing
agencies or units.
4.7.5Are periodic reconciliations performed among the different offices √YES
and implementing agencies? NO
4.8 Other
4.8.1Describe the options available to employees, beneficiaries and The person responsible for the project is the head of the project. If the IA can not
others for reporting suspected fraud, waste or misuse of project deal with the issue, it will be reported to the municipal government
resources or property?
4.8.2What measures has your agency taken to inform employees, forthcoming
beneficiaries and others of their options for reporting suspected
S App 8 - 45
Topic Response
fraud, waste or misuse of project resources or property?
4.8.3Will representatives of the municipal discipline investigation bureau √YES
be involved in project bidding and construction activities? NO
4.8.4Do contracts let by your agency for civil works and other large √YES
5.0 Are financial statements prepared for your agency? If YES, what √YES accounting standards: The accounting system of state-owed unit
accounting standards are they based on? NO
5.1 How often are financial statements prepared? annual
5.2 How quickly are the financial statements prepared at year end? ten days
5.3 Are separate financial statements prepared for the office or unit in your YES
agency that will implement the Project? √NO
5.4 Will the financial reporting system need to be adapted to report on the YES
project components? √NO
5.5 Does the reporting system have the capacity to link financial information √YES
with information on the physical progress of engineering project's? NO
5.6 Describe procedures and controls used to insure that the physical Each department strictly enforces
project data can be compared and coordinated with the financial
data?
5.7 Are there financial management reporting requirements for existing Timely and accurate delivery of financial management report is required
5.7.1what reports are to be prepared prepare financial statement: Balance sheet, summary of sources and uses of
funds by project component and statement of implementation of loan agreement
5.7.2what the reports are to contain Capital source conditions, capital consumption conditions and project
construction progress
5.7.3how the reports are to be used provide information for enterprise’s internal and external managers
5.8 What information do the financial management reports for engineering √ Total project expenditures to date
projects contain? (check all that apply) √ Comparison of actual expenditures with budgets
S App 8 - 46
Topic Response
NO
5.10 Describe a recent action taken by management in response to No
information provided in a financial management report?
5.11 Are financial reports prepared directly by the automated accounting √prepared by an automated accounting system
system or are they prepared by spreadsheets or some other manual prepared by spreadsheets or other method
method? both ways used
6 Internal Audit
6.0 Is there an internal auditor or audit department in your agency? YES  answer questions 6.1 to 6.5
√NO  go to section 7

6.3 Will the internal audit department include the Project in its work
program?
NO
6.5 Describe the most recent actions taken in response to the internal audit
findings?
7 External Audit
7.0 Is your agency financial statement audited each year by an independent √YES Who: Baishan Chenghua Audit Company
non-government auditor? If YES, who is the auditor?
NO
7.1 How soon following the financial yearend are audit reports issued? 1 month after the fiscal year
7.2 Is the audit of your agency conducted according to International YES
S App 8 - 47
Topic Response
Standards on Auditing? √NO
7.3 Were any major accountability issues identified in audit reports over the YES
past three years? √NO
7.4 Will your agency auditor audit the Project financial statements and agency auditor
accounts or will another auditor be appointed? √ another auditor
7.5 Has your agency implemented all recommendations made by the YES
auditors in audit reports or management letters over the past three √NO explain: no negative comments were made by the auditor.
years? If NO, please explain.
7.6 Is the Project subject to any kind of audit from an independent YESWho:
governmental entity (e.g., the supreme audit institution) in addition to
the external audit? If YES, who is the independent entity? √NO
7.7 Does your agency have separate terms of reference for annual audits of YES
major projects? √NO
7.8 Please provide the audit reports for the past three years. √ Provided
 Not provided – please give reason
8.0 Is the financial management system computerized? √YES

NO
8.1 Can the system produce the necessary project financial reports? √YES
NO
8.2 What training has the staff received to operate the system? training for financial software
8.3 What controls are there to safeguard the confidentiality, integrity and Set permission and password according to department personnel. Paper archive
availability of data in the information system? and electric data archive
S App 8 - 48
Baicheng Urban Planning Analysis
1
1. Background
1. China endeavors to push forward its ambitious plan of the Chinese-style urbanization, with
the preference on the development of small/medium sized towns/cities. The Chinese cities are
generally experiencing rapid developments in the past three decades. The pace of urbanization of
Baicheng is lagging behind. Although Baicheng is still one of the poorest cities in Jinlin Province, it
has a lot of potential due to its strategic location, the existing and planned key transport infrastructure,
and the rich resources that support the growth of the city.
2. Baicheng city has a population of 235,000. The city is about 12.5km away from the joint
boundary of Jilin Province and Inner Mongolia Autonomous Region (Figure 4) and is also close to Hei
Long Jiang Province (about 80km away from the boundary). Being the central city of the
three-provincial border region, and the must-pass-through-place from northeast Inner Mongolia
Autonomous Region and southwest Hei Long Jiang Province to Jilin Province, Baicheng is planned
to be the central hub of this predominantly rural region to serve about 4,000,000 population.
Figure 4 Baicheng locates close to the border of three provinces
3. Baicheng is at a pivot location of the economic corridor (Figure 5) between Mongolia, China
and Russia. This corridor is an important part of the Northeast Asia Economic Zone (inc China,
Mongolia, Russia, North Korea, South Korea and Japan). In future this corridor will be the main route
for Mongolian resources exporting to China, Japan and South Korea and also for industrial products
from these countries flowing back to Mongolia.
2
Figure 5 The Mongolia-China-Russia Economic Corridor of East Asia
Resources
• Wind Energy
4. Baicheng has great potential for the capture and utilization of wind energy. According to the
climatological data from 1951, there were average 24 days with 8 levels or above gale per annum,
average 47 days with below 8 level gale (about 60% windy days are in spring) per annum in
Baicheng. And annual average wind speed reached 3.7 meters per second. A survey carried out by
Central South Survey and Design Institute in 2009 confirms that the total area of land developable for
wind energy in Baicheng is 6,865 sqkm with the installed capacity of 22,800,000 KW. Currently the
installed capacity in Baicheng is about 2,130,000 KW. There is, therefore, more than 90% wind
energy capacity are waiting to be explored in Baicheng District.
• Water
5. Baicheng is rich in water resource. The total extractable underground water is 1.539 billion
cubic meters whilst 0.263 billion cubic meters are currently extracted (accounts for about 17.1% of
the total amount). The surface water resource is about 0.189 billion cubic meters whilst 0.041 billion
cubic meters are currently used (account for about 21.7% of the total amount). There is great
potential for water supply to meet the future development needs of the city.
• Ecology
6. Baicheng has unique natural and ecological resources. There are two National Nature
3
Reserve Areas, one Provincial Nature Reserve Area and one National Hunting Area in Baicheng
District. They are:
 Xianghai National Nature Reserve Area: The world A-Class wetland, it is the home of Red
Crowned Crane;
 Momoge National Nature Reserve Area: National wetland, the home of White Crane, White
Stork and Red Crowned Crane. It is called the paradise of birds.
 Baolawendu Provincial Nature Reserve Area: Wetland featured by large area of wild apricot
trees.
 Donggou National Wetland Hunting Area: it is the permitted hunting area by National Ministry
of Forestry. The Hunting area includes 4,000 hectare woodland and two rivers.
7. The natural and ecological resources in Baicheng is not only the natural assets that benefit
the environment of Baicheng as a whole, but also the city’s strenghth for culture, leisure and tourism
developments.
City Economy
8. According to the Baicheng Government Work Report 2012, agriculture accounts for over 1/3
of Baicheng GDP. This means Baicheng’s economy is still at the basic development stage as
agriculture remains the major supporting economic element of Baicheng.
9. Baicheng’s industrial base is relatively weak but the recent five years have seen over 25%
annual growth rate of the industrial sector. Among all industries, agro-food processing and
energy-related industries (wind and fire power) are the two major industrial types to support
Baicheng economy.
10. Baicheng is one of the important energy bases of Jinlin Province, the planned energy
generation capacity of Baicheng will reach 10,000,000 KW fire powered electricity and 20,000,000
KW wind powered electricity. The situation is that the existing industry of Baicheng, typically
agro-food processing, has relative low energy consumption. So there is a huge amount of energy
surplus which needs to be consumed locally. Otherwise the energy will be wasted. There is, therefore,
an urgent need to further develop and diversify the industry types in Baicheng in order to melt away
the surplus energy supply. Furthermore, if the surplus energy can be consumed by additional
industries, it will stimulate the development of wind energy equipment manufacturing sector in
Baicheng.
11. Although there are rich natural and ecological resources in Baicheng district, the tourism
economy is currently under-developed due to the city’s relative remoteness, the lack of investments
in tourism facilities and the absence of overall planning to integrate the tourism resources.
12. In summary, the city’s economy is in need of diversification. Agriculture economy has limited
growth potential and industry (with high energy consumption) and tourism are two promising sectors
that the city needs to strengthen upon.
4
Transport
13. Baicheng occupies a strategic location in terms of transportation. Two provincial capital cities,
Changchun and Harbin, are within 230 km radius of Baicheng. There are four railway lines and two
high level roads that are interconnected at Baicheng (Figure 6). The city is one of the must
pass-through places between Inner Mongolia and North east China.
Figure 6 The regional transportation of Baicheng
Rail
14. Baicheng is the railway/logistic hub of four main/branch railway lines. They are:
 Bai-A Line: Baicheng (Jinlin) – Aershan (Inner Mongolia);

 Chang-Bai Line: Baicheng (Jinlin) – Changchun (Capital City of Jilin Province) – Jinlin city
(Jinlin Province)
 Tong-Rang Line: Tongliao –– Baicheng(Jilin) - Ranghu Lu (Mainly Freight Route to Daqing Oil
Plant)
 Ping-Qi Line: Qiqihaer (Hei Long Jiang) – Baicheng(Jilin) – Siping (Jilin)
15. According to Baicheng City’s Development and Reform Commision, the National Railway
Company is planning to upgrade and extend Bai-A Line and Chang-Bai Line, which will greatly
improved the freight transport capacity of these railway lines in future.
Road
16. There are one express way and one Provincial Highways that are inter-connected in
Baicheng. G12 Hui-Wu Express Way is the major regional artery passing through Huichun – Dunhua
– Jilin – Changchun – Songyuan – Baicheng – Wulanhaote. S207 Provincial Highway is an important
south-northwards artery connecting the city with wider areas.
5
17. The two main railway lines (Bai-A Line and Chang-Bai Line) and G12 Express Way form part
of regional economic corridor between Inner Mongolia – Jilin. In future, this regional economic
corridor may form part of the international economic corridor between Mongolia-China-Russia
2. The Proposed Regional Infrastructure
a. High Speed Rail
18. There is a proposed high speed railway line (Figure 7) going through Baicheng, starting from
Huichun (border city near Russia) in the east to Aershan (border city near Mongolia) in the west. The
designed speed of train will reach over 260km per hour reducing travel time from over 6 hours to
about 1 hour from Baicheng to Changchun. In future, there is a possibility that Mongolia and Russia
in the west have the equivalent compatible railway to connect in Aershan with the high speed rail
network of China
Figure 7 The proposed High Speed Railway Line via Baicheng (Source: http://www.gaotie.cn)
6
b. Airport
19. There is a proposed Airport near Baicheng which was supported by the “National Eleventh
Fiver-Year Plan”. The Baicheng airport will be one of the four airports to supplement Changchun
Longjia Airport - the main airport in Jinlin Province. The airport site locates within Tao Bei District and
is about 16.5 km away from Baicheng City.
20. It is estimated that the proposed airport will have the throughput capacity of 203,000 travelers,
1,019 tons freight and 2,459 flight sorties per annum. According to the initial plan, the airport will have
flights to Beijing, Dalian, Qingdao, Yanji, Changchun, Shenyang and Harbin.
21. The proposed airport will further strengthen the position of Baicheng as a central city in the
region. This will also enable Baicheng to conveniently interact with other major Chinese and
international cities. The first foundation of the airport was laid in October 2012. The airport is
expected to operate in August 2014 by earliest.
3. The Expansion of City Districts
22. Baicheng is now in the process of rapid expansion. According to Jilin Provincial Urban
System Plan, Baicheng is to be forged into a central city in northwest Jilin with strong industrial
manufacturing capability. And the population of the city is expected to reach 500,000 by 2020
(current population is 230,000) as stated in the plan. In fact, the rapid industrial developments in
recent years have laid a good foundation for the city’s expansion.
23. In order to relief the pressure on the old city, and to support the provincial level plan to build
Baicheng into a central city in west Jinlin area, the city has ambitious urban expansion plan to meet
the growing needs of the city itself and the development expectations from provincial level. Four new
districts have been planned in addition to the old city (Figure 8). They are:
 Economic Development District (EDD)

 New Eco-City District (NED)
 Industrial Park District (IPD)
 Tao Bei Economic Development District.(TEDD)
24. The four districts are in the process of expansion with the aim of promoting more extensive
industrial and commercial developments to attract and support more residents to the city.
7
Figure 8 Five districts in Baicheng
Economic Development District (EDD)
25. Baicheng Economic Development District (EDD) was first established in 1998 with the
permission by Jinlin Province Government to be a Provincial-Level Development District. According
to the Baicheng Masterplan, EDD (Figure 9) will mainly accommodate technology, industrial,
commercial, and logistics related developments with supplementary residential developments.
26. EDD currently has 100,000 residents. There are a range of key projects proposed within this
area that will enable the creation of 11,118 job opportunities for local people. EDD is the main district
that benefits from the proposed West City Infrastructure Project. It is therefore of vital importance for
EDD whether the infrastructure project can go ahead with required fund or not.
Table of Proposed Major Projects in Economic Development District (EDD)

Project Name Net Land Requirement No. of Estimated No. of
(Ha) Employees per Jobs
Hectare
Car Trading Estate 30 33.4 1,000
8
Construction 53 33.4 1,770

Materials Trading
Market
Agricultural 30 33.4 1,000
Machinery Logistic
Park
Yiwu Micro 20 66.8 (33.4x2) 1336
Consumer Goods
City
Agricultural 10 33.4 334
Products Settle
Account Center
Agricultural 10 33.4 334
Products
Networking Center
50 Industrial 160 (3.2x50) 33.4 5344
Enterprises
Total 313 11,118
27. (Note: The figures in the above table are estimatied based on the calculation of average
number of employees per hectare industrial/commercial land in Baicheng. The proposed major
projects will be implemented in near future)
9
Figure 9 Economic Development District
New Eco-city District (NED)
28. This District (Figure 10) was just established in 2012. This district will partially benefit from
the proposed Infrastructure Project. Some of the roads are there to facilitate the connection between
New Eco-city District and the Economic Development District. The total planned area of this district
will be 25 km2 and will accommodate 98,000 populations when mature.
29. The main function of this district is a sustainable living district of the city with commercial,
Leisure, culture service facilities. San Huan Road will be the key road to connect the area with the
adjoining areas;
30. There are four major employment sites within the district. They are:
1. Central Business and Central Municipal District (121 ha)
2. Logistic Trading Park (138 ha)
3. Business & Technology Park (180 ha)
4. North Military Arms Theme Park (144 ha)
(Note: Above data is from the Development Control Plan of the New Eco-city District)
10
Figure 10 : Plan of the New Eco-city District
Table of Planned Employment Sites in New Eco-city District (NED)

Project Name Planned Land Net Land for Estimated No. of
Area Calculation (Ha) Jobs
(Ha)
Central Business and 121 242 (121x2) 8,082
Central Municipal
District
Logistic Trading Park 138 69 (138/2) 2,304
Business & Technology 180 90 (180/2) 3,006
Park
North Military Arms 144 38 (144/4) 1202
Theme Park
Total 583 14,594
(Note: The figures in the above table are estimated based on the calculation of average number of
employees per hectare industrial/commercial land in Baicheng)
Industrial Park District (IPD)
11
31. The Industrial Park District (IPD) (Figure 11) was initially established in 2005 and was
formally permitted by Jinlin Province Government in 2011 as a Provincial-level Development District.
Figure 11 The Industrial Park District
32. The IPD covers 22 km2 and is to be developed in three phases. Phase I, II and III cover 5.1
km , 5.9 km2 and 11 km2 respectively. If the IPD is fully occupied, there will be 36,740 job
2
opportunities in total.
33. Phase I and Phase II areas have already been served by good infrastructure. To date, there
are 106 confirmed projects in the industrial park, 26 of them with over 100 million RMB investments.
Currently there are 7,458 employees in the park. Phase I development is largely occupied. Phase I &
Phase II is planned to be fully occupied in five years time. There are additional 10,912 job
opportunities to be created in the next five years according to the plan.
Taobei Economic Development District (TEDD)
34. Taobei Economic Development District (TEDD) (Figure 12) was established in 2010. The
district comprises four sub-functional areas including a Modern Logistic Park, a Modern Commercial
and Trading Park, an Eco Commercial and Residential Area and a New Industrial Park.
12
Figure 12 The Taobei Economic Development District
35. The total planned area of TEDD is 33sqkm, which is to be developed in five phases. Phase I
is 3.2 km2 and it is planned to develop 10sqkm industrial land in total by 2016. Focused on clean
energy industry, machinery manufacture, agro-food and pharmacy & medical equipments industry,
the district government endeavors to create total 12,000 jobs in TEDD in near future.
4. The Factors to Support the City’s Expansion
36. The ambitious urban expansion plan in four districts of Baicheng matches the city’s potential.
There are a range of factors that will support the city’s further developments in the long term:
1). Policy Support in provincial Level

The city has been listed into the Jilin Provincial Urban System Plan as a central city in Northwest
Jinlin. According to the Plan, Baicheng is to be constructed into an important industrial city with a
population of 500,000 in next ten years. The high expectation from provincial level means the city
is likely to get the policy backup needed to support the rapid growth of the city.
2). The foreseeable East Asia Co-operation:

Baicheng is located at a pivot point of one of the ‘must-pass-through’ route of
Mongolia-Russia-North Korea corridor. It is foreseeable that the economic and transport tie
13
between Mongolia, China, Russia and North Korea will get stronger and stronger over time as
the East Asia economy develops. More comprehensive East Asia co-operation is taking place in
the foreseeable future. This will add to Baicheng’s strategic importance in East Asia Economic
Zone. In future, the industrial products from Baicheng can easily be transported to Mongolia,
Russia and North Korea. There is, therefore, good prospect for the Baicheng’s role in East Asia
Economic cohesion, which is a strategic advantage for Baicheng’s long term growth.
3). Proposed regional transport infrastructure

The proposed high speed railway and airport will conveniently connect Baicheng with other
Chinese cities and possibly with cities in other East Asian Countries in future. The high speed
railway will significantly reduce the travel time by rail (previously over 6 hours from Baishan to
Changchun reduced to about 1 hour). The airport will immediately open the door for Baicheng to
directly interact with the ‘external world’. These are undoubtedly a very important driving force to
raise Baicheng’s position in terms of regional, national and international importance.
4). Convenient transport link and the proposed upgrade of rail-based freight transport
Baicheng has convenient road and rail transport links with other major cities in the region. This is
a necessary prerequisite for industrial developments. The proposed upgrade of two main railway
lines further benefits Baicheng’s continuous efforts to attract more industrial enterprises into the
city.
5). Sufficient water and energy supply

Baicheng benefits from its rich water and wind energy resources, which are particularly helpful for
the city’s planned industrial developments. Renewable energy is one of the strategic industries
with promising future as sustainable developments are key to China’s economy transition and
industrial upgrade. It is a tangible advantage of Baicheng in the use of wind energy and the
development of wind energy related equipment manufacturing. This will support Baicheng’s long
term growth.
6). Great potential for tourism economy;

The unique natural and ecological resources are the treasure of Baicheng. The under-developed
tourism industry is where Baicheng’s potential lies. The proposed airport and high speed rail will
reduce Baicheng’s remoteness, which will then bring more tourists and create more tourism
related employment opportunities in future.
37. Baicheng has great potential to become a city of regional, national, even international
importance in the long term. The urban expansion plan suits the city’s future status and is reasonable
with reference to the rapid development pace of many precedent Chinese cities.
5. The Necessity of Baicheng Urban Development Project
38. Lack of development fund is one of the main constraints that threat the further development
of the city. The City needs the right level of facilities/infrastructure to meet its growing needs for
14
finance, technology, market, information, tourism and Living. However, due to the city’s limited
capability to raise the required fund, the much needed improvements to key infrastructure such as
road, waste collection & disposal and drainage have been delayed. This is undermining the amenity
of people who live and work in Baicheng, causing environmental problems and undermining the
City’s attractiveness to potential investors.
39. In Baicheng west city area, new residential areas have been developed without proper
connection with other parts of the city; population which have been settled into newly developed
residential buildings along district roads without proper municipal network are disconnected from the
central municipal services. Currently it is estimated that 100,000 (that is almost one third of the city)
residents are not yet connected to the central WWTP leading to a wastewater collection rate of 30%.
There is an urgent need for the improvement/installation of waste water collection system.
40. The density of Road network and grade of road are noticeably lower than the average level of
Jinlin Province. And the drainage system in the old city district is out-dated and disconnected. The
rapid growth of the Industrial sector in Baicheng recent years generates more and more job
opportunities and is attracting farmers from nearby areas to work and live in the city. This adds to the
pressure on the already over-burdened municipal infrastructure.
41. The proposed 9 roads are the critical infrastructure of west city area, which is key to the
success of the Economic Development District (EDD) and the New Eco-City District (NED). These
roads will conveniently link the west city area with other parts of the city, and also connect new
residential areas with the proposed employment sites (Figure 13).
Figure 13 The Proposed 9 roads in West City Area
15
42. The construction of strategic new roads and associated facilities will increase the synergy
and create a rational link between the city districts. Moreover it will open well planned urban areas,
providing new residential and mixed-use function areas to accommodate future residents and
economic activities and organize the future urban growth.
43. In China, infrastructure is one of the key components of the city’s competitiveness of
attracting industrial and commercial investments. Poor infrastructure increases the difficulty of
developments and raises the running costs of projects, which often scares off potential investors.
Baicheng infrastructure development project is an opportunity to show Baicheng government‘s
determination on the continuous investments on the city’s infrastructure. This will provide a high level
of certainty to potential investors.
44. The proposed Baicheng infrastructure project will create thousands of job opportunities for
skilled and non-skilled workers to work directly on the project in additional to indirect employment
opportunities. The improvement of city infrastructure would then enable the proposed industrial and
commercial development projects in Economic Development District (EDD) and New Eco-city District
(NED). The confirmed proposed projects in EDD will create 11,118 local job opportunities as
estimated. In NED, the estimated number of local jobs within the district will reach 14,594 in the long
term. The project will also enhance the city’s overall attractiveness and then indirectly support the
employment growth of other districts in the city.
6. Conclusion
45. Baicheng has the potential to become a city of great importance in northeast China. Currently,
the city is at its early stage of growth and is in urgent need of funding to finance the much needed
infrastructure improvements such as strategic roads, drains and solid waste collection/disposal. The
lack of fund for infrastructure improvements has long been the major problem that restricts
Baicheng’s developments.
46. The ADB loan represents a precious opportunity for Baicheng to raise the necessary fund to
finance the proposed west city infrastructure project. This project will directly benefit people who live
and work in the area, create a considerable number of local jobs, help to attract further investments,
and be the catalyst for the continuous growth of the city. The ADB loan is vital to Baicheng’s
development at this stage and it is strongly recommended to grant the loan to fuel the city’s journey
to success.
Appendix
Table 1 Existing Industrial Enterprises in Industrial Park District (IPD)
Occupied Land Number of

Name of Company
(ha Employee
1 Baicheng Tongwei New 7.1 62
16
Construction Materials Limited

Baicheng Guobin Machinery
2 1.0 53
Manufacturing Limited
Baicheng Tianpai
3 Petrochemical Engineering 1.0 26
Limited
Baicheng Fangyuan Doors &
4 Windows Manufacturing 1.5 37
Limited
Baicheng Luyou Road
5 1.2 31
Engineering Limited
Baicheng Suotian Building
6 1.0 66
Coating Materials Limited
Baicheng Jinshan Steel
7 Structure & Colour Steel Plate 4.8 173
Engineering Limited
Jilin Gongyiyuan Organic Food
8 10.0 236
Limited
Baicheng Yonghe Plastic
9 0.48 45
Textile Limited
Baicheng Branch, Jilin Daming
10 1.65 3
Steel Structure Limited
Baicheng East Advertising
11 0.5 35
Limited
Baicheng Hualong Plastic
12 0.5 28
Printing and Packaging Factory
Baicheng MIngrenju Condiment
13 1.36 96
Food Limited
14 Baicheng Yujie Boiler Factory 0.5 19
Jilin Zaowu Light Steel Tile
15 2.0 77
Limited
Baicheng Minfu Construction
16 1.5 45
Materials Limited
Baicheng Hande New Eco
17 3.0 219
Building Materials Limited
Baicheng Beiyuan Water
18 Conservation Irrigation 0.45 15
Equipment Limited
Baicheng Zhenglong Gear
19 11.9 827
Wheel Inc
Jinlin Jianzhitai Bio-technology
20 1.0 18
Limited
Baicheng Fengshen Rice
21 5.0 167
Processing Limited
17
Baicheng Hongdi Motor Gear

22 1.2 59
Wheel Limited
Baicheng Xinda Oxygen
23 0.45 12
Limited
Baicheng Letian New Building
24 2.0 35
Materials Limited
Baicheng Nitegu Car
25 1.0 36
Components Limited
Jinlin Runze High-efficiency
Water Conservation Irrigation
26 10.0 48
Technology Development
Limited
27 Jinlin Shengji Bio-chemical Inc 18.0 233
Jinlin Kangxi Bio-technology
28 3.3 31
Limited
Baicheng Jincheng Insulation
29 1.0 42
Materials Limited
Baicheng Jinqiao Noodle
30 0.5 46
Factory
Baicheng Longju Pipeline
31 7.7 230
Engineering Limited
Baicheng Chengyuan Eletric
32 5 158
Concrete Products Limited
Baicheng Dongjia Grain Food
33 15.1 152
Development Limited
Baicheng Xinyu Car Cable
34 1.01 50
Jinlin Zhongzheng Medical
35 2.69 41
Packaging Limited
Yihanjiali (Baicheng) Food and
36 23.38 365
Edible Oil Processing Limited
37 Jinlin Tongli Industrial Limited 10.1 286
Baicheng Jinsheng Nickel
38 11.8 431
Industry Limited
Baicheng Jiahe Steel Structure
39 3.0 20
Limited
Baicheng Tianqi New Energy
40 12.4 241
Equipment Limited
Baicheng Shuangshuang Door
41 & Window Manufacturing 1.0 80
Limited
Baicheng Longyue Plastic
42 0.45 80
Textile Limited
43 Zhongcai Technology 14.3 403
18
(Baicheng) Wind Energy Vane

Limited
Baicheng Zhongtian Steel
44 0.34 50
Structure Limited
Baicheng Fuda Steel Bar
45 3.38 200
Rolling Limited
Baicheng Longdan Diary
46 18.0 260
Technology Limited
47 Baicheng Yushi Concrete Inc. 2.2 102
Baicheng Tianhe Machinery
48 1.0 35
Limited
Baicheng Baiqiang Boiler
49 0.8 35
Huarui Wind Energy
50 34.93 150
Technology (Jilin) Limited
Baicheng Tianfu Food & Edible
51 7.2 150
Oil Group Co Limited
Baicheng Dongjia Rich Bran Oil
52 7.06 80
Limited
Baicheng Hongyue Road and
53 2.6 72
Bridge Limited
Baicheng Haodong Concrete
54 3.0 60
Products Limited
Dalian Lvbo Baicheng Licorice
55 Technology Development 3.5 110
Limited
Baicheng Yongmao Eco
56 Building Materials Products 3.01 80
Limited
Baicheng Xinhong Drilling Tools
57 7.04 140
Limited
Baicheng Xinhong Electric
58 5.67 60
Equipment Limited
59 Jinlin Tongyi Industrial Limited 4.29 103
Baicheng Fusang Special
60 10.0 176
Vehicle Manufacturing Limited
61 Jilin Shilihe Industrial Limited 6.04 89
Baicheng Sifang Electrical
62 1.0 43
Equipment Limited
Baicheng Huigang Printing and
63 2.2 106
Packaging Limited
64 Jilin Jiangyu Textile Limited 4.41 120
65 Huarun Gas Holding Limited 2.0 32
19
Jilin Zhongzheng Medical

66 2.58 41
Packaging Limited
Baicheng Yida Machinery
67 0.59 62
Limited
Jilin Beisuo Medical Packaging
68 5.0 163
Materials Limited
69 Jilin Huayu Edible Oil Limited 2.7 100
Baicheng Sifang Asbestos
70 1.0 43
Drilling Tools Factory
(Note: based on the number of Industrial Enterprises, occupied land and number of employees, the
average density is 33.4 person per hectare of industrial land)
Table 2 Existing Industrial Enterprises in Taobei Economic Development District (TEDD)
Occupied Land
Name of Industry No. of Employee
Ha
Jinlin Botai Agriculture
1. 17.1 240
Technology Development Limited
Jinlin Yaheng Farming
2. 11.23 300
Technology Development Limited
Baicheng Small/Medium
3. 8.5 500
Company Hatching Base Limited
Baicheng Hongrun Steel
4. 5 180
Moulding Plate Limited
Jinlin Province Ji Cheng
5. Shuangquan Energy Technology 3.3 120
Limited
Baicheng Yuanda Steel Structure
6. 1.83 60
Engineering Limited
Baicheng Ouruite Medical
7. 0.99 58
Materials Technology Limited
Baicheng Electricity Supply
8. 0.032 38
Company 66kv Substation
(Note: based on the number of Industrial Enterprises, occupied land and number of employees, the
average density is 31.2 person per hectare of industrial land)
20

Jilin Urban Water Supply Analysis

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Technical Assistance Consultant’s Report

Project Number: 46048-001

People’s Republic of China: Jilin Urban Development

Prepared by HJI Group Corporation

For Jilin Provincial Government

Currency Unit – yuan (CNY)

In this report, "$" refers to US dollars.

5.3 Water Treatment Plant ......................................................................................................... 29

1.1 Overall Description

1.2 Baishan City

1.3 Baicheng City

2.1 Geography and Topography

2.1.1 Baicheng City

2.2 Rivers and Water Systems

2.2.1 Rivers and Water Systems in Baishan Municipality

2.2.2 Rivers and Water System in Bacheng Municipality

2.3 Water Conservancy Engineering

2.3.1 Water Supply Engineering In Baishan City

Taipinghu HeigouRiver 84.3 1.145 0.686 Small A Fishing, irrigation

Jiangyuan Yue-jin Xibeicha River 1 0.115 0.042 1972.11 Small B Irrigation

Total 34.789 24.528

2.4 Climate Condition

2.4.1 Mean Annual Temperature

2.4.2 Precipitation in Jilin Province

1. The Outline of The Urban Master Plan of Baicheng Municipality.

Figure 2-3: The Distribution Situation of Precipitation in Space during 1970-2000

2.4.3 The Variation Trend of Annual Precipitation and Annual Temperature

Figure 2- 4: Annual mean temperature in Jilin Province during 1961-2010

Figure 2-5: Annual mean precipitation in Jilin Province during 1961-2010.

3. Water Resource Assessment in the Project Area

3.1 Water Resource Amount Assessment in Baishan City

3.1.1 Total Water Resource Assessment

Total 2721 1155 405 252.87 36.29 1155 405

3.1.2 The Available Water Resource Amount Assessment

Figure 3-1: Hun River Water System

3.1.3 Status of Construction of Xibeicha Reservoir

3.1.4 Water Quality Assessment

3.2 The Existing Water Consumption Assessment of Baishan City

3.2.1 Overall Current Water Consumptions in Sector's Assessment

Table 3-2: The Situation of Water Consumption of Baishan City by 2011.

Figure 3-2: Proportions of Sector's Water Usage by 2011 in Baishan City

Urban domestic Industry Public facility

3.2.2 Current Water Use Efficiency

3.2.3 The Changing Trend of water Consumption

Water supply /consumption amount Years

Total water Suppy Cang-nan-gou Nanshan Jinying Zhenzhumen

Annual water supply amount (10,000 proportions in total Water

3.3.1 Review of the Current Situation of the Water Supply

3.3.2 Review of the Water Treatment Plant

3.3.3 Identify Potential Weakness In Existing Infrastructure and Management

not fully developed yet.

3.3.5 Assessment on the Current Tariff Level

Urban Industrial Special

2.30 4.00 4.00 7.00

3.4 Water Resource Assessment in Baicheng

3.4.1 Total Water Resource Assessment

3.4.2 The Available Water Resource Amount Assessment

473200.00 402200.00 89.33 402289.33 21.18 11.38 32.56 402256.77

3.5 The Existing Water Consumption Assessment Of Baicheng City

3.5.1 Overall Current Water Consumption in Sector’s Assessment

4. The Water Resource Management Statistic Yearbook of Baicheng City, 2012.

by 2006 with about 7% of average annual average increase rate.