ARISE Project: environmental and social management framework

Abstract

The Environmental and Social Management Framework (ESMF) is developed for Accelerating Renewable Energy Integration and Sustainable Energy (ARISE) project. The project is funded by the World Bank and implemented by Government of Maldives (GoM). Ministry of Environment (ME) is the key implementation agency. Implementation partners for the project include State Electric Company Limited (STELCO) and FEN AKA corporation limited the two-government owned electricity service providers in the country. The project is comprised of four components: Component l: Solar PV risk mitigation (US$24.8 million IDA Guarantee and US$6.2 million IDA Grant) - This component will provide risk mitigation packages to private sector Independent Power Producers (IPPs) to cover off taker risks. This component is expected to cover 36 MW of solar installation through a number of phases through various geographic localities across Maldives. Component 2: Battery Energy Storage System (BESS) (USD 25 million CTF Loan)- This component will support deployment of BESS system in some islands to enable high penetration of solar PV. This addresses challenges posed of rapidly integrating variable energy to existing grids. The Component targets to support about 50 MWh of BESS in the selected grid systems, subject to market price trends. Component 3: Grid Modernization for VRE integration (US$2 million CTF Loan and up to approx. US$25 million from other IFI co-financing) - This component will support grid upgrades and reinforcement to accommodate an increasing volume of renewable energy and BESS, especially for longer duration, in selected grid systems. Component 4: Technical Support (USD 3 million CTF Grant) - This component provides technical assistance on the following key areas: (i) Institutional Capacity Building (Utility, ME and other energy producers); (ii) Pipeline Developments (Feasibility studies and other relevant studies); (iii) Other Sustainable Energy Developments; and (iv) Project management and implementation plan The project applies the World Bank's Environmental and Social Framework (ESF) with the following standards being applicable: ESS l: Assessment and Management of Environmental and Social Risks and Impacts; ESS 2: Labor and Working Conditions; ESS 3: Resource Efficiency and Pollution Prevention and Management; ESS 4: Community Health and Safety; ESS 6: Biodiversity Conservation and Sustainable Management of Living Natural Resources; ESS 8: Cultural Heritage; ESS l 0: Stakeholder Engagement and Information Disclosure. These aspects are applicable to components 2,3 and 4 of the project. For Component 1, as the project involves private sector investments which has guarantee component from International Development Association (IDA) to cover off taker risks, International Finance Corporation (IFC) performance standards are applicable to the project. Like ESS the applicable PS for the project includes: PS l: Assessment and Management of Environmental and Social Risks and Impacts, PS2: Labour and Working Conditions, PS3: Resource Efficiency and Pollution Prevention, PS4: Community Health, Safety and Security, PS 6: Biodiversity Conservation and Sustainable Natural Resource Management and PSS: Cultural heritage. A number of national regulations were identified as applicable for the project. This includes environmental, energy and social regulations. From environmental point of view the several regulations that were developed under Environmental Protection and Preservation Act (4/93) of the Maldives was found to be applicable. This includes: Environmental Impact Assessment Regulations, Waste management Regulation, Regulation on Protection of Old Trees, Regulation on Cutting Down, Uprooting and Transfer of Trees and Palms from One Island to Another, Protected Area Regulation, Migratory Birds Regulation and Dewatering Regulation. From the energy sector the applicable policies, legislation, regulations and guidelines identified include: Strategic Action Plan, Public Service Act ( 4/96), Net metering Regulation, Generation Distribution Supply Licensing Regulation, Guidelines for Power System Approval and Export Import Act and Export Import Regulation. From a social and cultural perspective the identified laws and regulations include: Land Act, Employment Act, Decentralization Act, Heritage Act, Construction Site Health and Safety Regulation, laws and regulations related to migrant workers and laws and regulations in relation to gender. Several gaps were identified between national requirements and that of World Bank ESS through a gap analysis. In general World Bank standards were identified to be more stringent. For instance, nationally, the focus of assessments and impacts on development projects is very much focused on environmental aspects while world bank standards give preference to both environmental and social aspects equally. Moreover, as per national requirements, the impacts of projects on vulnerable groups are not investigated in detail. Another aspect missing locally through legislation is the right for unionizing, collective bargaining and the right to strike. Furthermore, for pollution prevention air quality requirements were found to be missing from local legal requirements. Mechanisms to address grievances that arise as a result of projects are also found to be missing through local regulations. Six islands have already been identified to undertake project activities as a first phase. This includes: Addu City, Fuvahmulah City, Kulhudhuhfushi City, Thinadhoo, Hinnavaru and Eydhafushi. Key environmental and social features of these islands were presented in the ESMF. In this regard, it was identified that there are a number of wetland areas in majority of these locations including Addu, Fuvahmulah, Kulhudhuhfushi and Thinadhoo. It was identified that many of these islands have cultural and historical significance. For example Fuvahmulah used to be a location where political prisoners were banished, Addu used to be a base for British Airforce during World War II and Thinadhoo was involved in a significant and violent uprising. The main impacts identified for the project include impacts that occur due to disposal of hazardous waste (PV systems and Battery) installed through the project at end of life, vegetation clearance, impacts on aviation where solar PV is installed in airports, impacts on light and heat reflection, impacts on buildings where solar PV is installed, impacts on land use, labour related impacts, impacts on vulnerable groups and impacts on marine habitat due to floating solar PV. The ESMF identifies mitigation measures to address these impacts. This include; ensure safe disposal of solar panels and battery systems by including provisions in contracts, preferring vegetation relocation and where it has to be removed planting two trees to every tree removed, undertaking glare assessment for PV installed close to airports, structural assessment undertaken where PV is installed on rooftops, signing MOU with council to secure land, preferring land which cannot be used for another purpose, involving vulnerable groups in all stages of the project, establishing labour management procedures for the project, establishing stakeholder engagement plan for the project and undertaking feasibility assessments prior to undertaking floating solar installation. The ESMF also includes chance find procedures for cultural heritage and grievance redress mechanism for addressing public grievances regarding the project. The ESMF also lays out the steps that needs to be followed when attaining approval for various activities that are undertaken througl1 the project. In this regard, for Component 1, it has been determined that prior to bidding, structural assessment of buildings, glare assessment for projects close to airports and feasibility studies for floating solar projects, need to be undertaken. Moreover, for this component, Environmental and Social screening needs to be undertaken and the level of assessment required for IPP identified and information disclosed prior to the bidding process. As for Components 2 and 3, the ESMF identifies that screening and the required ESIA or ESMP following screening needs to be completed and included in bidding documents for works contractors. The ESMF mentions the responsible parties and administrative arrangements for implementation of ESMF. In this regard, the all environmental and social screening will be undertaken by the Project Management Unit (PMU) of ME for all the components. For Component 2 and 3, Environmental and Social Impact Assessment (ESIA) and Environmental and Social Management Plan (ESMP) will be prepared by PMU. For component l it will be undertaken by IPP. The Environmental and Social Safeguards Specialist (ESS) of the PMU will assume the prime responsibility of implementation of this ESMF, while the Communications Specialist (CS) will provide support in implementing the requirements in terms of undertaking consultations and awareness session required under this ESMF. Furthermore, STELCO and FENAKA will identify island-level Environmental and Social Officers (ESOs) as focal points to provide support for implementation of this ES.MF. Moreover, the Monitoring and Evaluation Specialist will take the lead in implementing the Gender Action Plan. A detailed Grievance Redress Mechanism (GRM) for the project has been included in the SEP and also referenced in the ESMF. The first tier of the mechanism is the site, the second tier is the council and the third tier is Ministry of Environment. This system was defined based on the experience from previous energy projects implemented in the Maldives. Information on GRM is required to be displayed at the site, at the council, at the electricity service provider office and on the website of ministry, council and the electricity service provider. The ESMF also identifies capacity development requirements. This includes training given to direct project staff by the World Bank and training given to ESO by the PMU. Cost estimates for implementation of this ES.MF and capacity development needs were identified in the ESMF.