IFC requires that this document be made available through the World Bank InfoShop and to the locally affected community no less than 30 days prior to project consideration by the IFC Board of Directors. The Summary of Project Information (SPI) also provides details of where the ERS has been made available to the locally affected community. The SPI must be sent to World Bank InfoShop no less than 30 days prior to project consideration by the IFC Board of Directors.

This is a Category B project according to IFC’s Procedure for Environmental and Social Review of Projects because a limited number of specific social and environmental impacts may result which can be avoided or mitigated by adhering to generally recognized performance standards, guidelines or design criteria. The review of this project consisted of appraising technical and environmental/social information submitted by the project sponsor and a physical evaluation of an operating facility. The following potential impacts were evaluated. - Sustainability of the AgCert process; - Environmental, cultural property and natural habitats protection and compliance with local regulatory requirements; - Protection of potable water resources; - Wastewater management; - Occupational health and safety; and, - Local environmental management.

The Sponsor has presented plans to address these impacts to ensure that the proposed Project will upon implementation of the specific agreed measures, comply with the environmental and social requirements, host country laws and regulations and the World Bank/IFC environment and social policies and the environmental, health and safety guidelines. Information about how these potential impacts will be addressed by the Sponsor/Project is summarized in the paragraphs that follow. - Sustainability of the AgCert Process. When methane gas forms as a result of anaerobic digestion of animal waste and escapes to the atmosphere, it is a GHG approximately twenty times more potent than carbon dioxide in terms of potential atmospheric damage. Accordingly, capturing and burning methane significantly reduces this potential. Methane combustion can be used for farm activities such as heating and/or a fuel for electrical power generators to generate energy. In the AgCert process, high-strength wastewaters from swine poultry, sheep feed lots, or dairy farms are collected and conveyed to lined, anaerobic pond(s) where anaerobic bacteria digest the wastes, producing methane as one of the by-products. Methane is captured in a flexible, airtight vinyl or high-density polyethylene (HDPE) cover. As pressure builds in the cover, gas is conveyed to a combustion device where it is burned to reduce its potential to damage the atmosphere. In the Brazilian state of Minas Gerais effluent from the wastewater treatment system can be used for irrigation of nearby agricultural crops (e.g. coffee, cotton, soybeans, or corn) if the hydraulic detention time equals or exceeds 22 days. Other states and countries may require varying detention times. Nevertheless, recycling/reuse of effluent and digested solids from the AgCert process provides significant added value to the Project and to local agricultural activities. Additionally, water and wastewater nutrients such N and P, which may seriously damage surface or underground water bodies, may be used by the crops thereby reducing and eliminating in some cases the need for artificial fertilizers. - Environmental, cultural property and natural habitats protection and compliance with local regulatory requirements. AgCert will undertake all locally required studies for land use and obtain permits for proposed operations. In accordance with the Kyoto Protocol each proposed new operation will be reviewed by local regulatory agencies and public consultation and disclosure programs will be carried out to ensure that host communities are apprised of project elements and have the opportunity to affect project design and implementation. The typical AgCert installation utilizes natural topography to move animal wastewater and solids to the digestion ponds. Cut and fill slopes and other physical, land-disturbing modifications that are required in each case will be protected from erosion by placement of appropriate ground cover and replanting to prevent erosion and to reestablish native vegetation. In the event of the occurrence of erosion that creates furrows and movement of sediments from the project site(s) will be immediately repaired with locally appropriate methods (e.g. placement of aggregate/bales of hay/netting/geomembranes, etc.) to repair damage and protect the slopes and digestion ponds from future damage and siltation. Should erosion persist, the host farm will install a storm water drainage system with sedimentation basins to ensure that surface waters are protected from sediment. If land treatment or disposal sites are not available for liquid and solid residues in a reasonable vicinity of a project site, Agcert will, prior to construction, collaborate with the host farm and local regulatory agencies and potentially affected communities and other water and land users to devise an appropriate treatment technology that will comply with wastewater discharge standards that the local regulatory authority will impose on the farm and that will be permitted by the local regulatory agency. Similarly, in the event of complaints about odor from local stakeholders AgCert will investigate and develop and implement a mitigation program - Protection of potential potable water resources. AgCert will monitor the use of effluent from its systems and work with farmers and local regulatory agencies to prevent impacts to potable water supplies local water supplies potentially affected by farming, wastewater digestion and disposal activities. Proposed use of the effluent for purposes other than crop irrigation will be disclosed to local regulatory agencies and approvals for such proposed uses will be obtained prior to implementation. - Wastewater management. In the event that a project farms sells or leases land that has been designated for disposal of effluent from a treatment system, AgCert will work with local regulatory agencies and submit all required data such as calculations indicating the depth of water and kilograms of solids per hectare of remaining land under the direct control of the project farm to facilitate comparison with hydraulic and solids loading rates allowed by the disposal permit granted by the local regulatory agency. AgCert and the farming entity will cooperate with the requirements of the local regulatory agency to ensure all changes to the proposed operation will be appropriate to ensure that land use permits are maintained and that there is 100% of compliance with local regulatory schemes. Additionally, if runoff and/or effluent from the project site(s) is to be discharged on or to cross neighboring land, AgCert will reach and document an agreement with the owner prior to commencing construction. - Occupational health and safety. AgCert will ensure that its operators and farm employees potentially engaged in operations and maintenance of the waste and methane management systems are fully trained in job hazards, personal protection and associated matters required to achieve full compliance with IFC’s occupational health and safety guideline. Project sites will be equipped with appropriate signage to alert individuals graphically of potential dangers and restricted areas. AgCert will monitor the frequency and severity of accidents and injuries and modify its occupational health and safety programs to ensure that such events are minimized throughout the network of operations.

Project documents submitted by AgCert, visual inspection of existing operations and interviews during an appraisal mission in December 2004 were the principal documents used for environmental appraisal and preparation of this document.

Accordingly, IFC concludes that the proposed project will meet the applicable World Bank/IFC environment and social policies and the environmental, health and safety guidelines upon successful implementation of the agreed mitigation measures.

IFC will evaluate Project compliance with the applicable environmental and social requirements during the lifetime of the project by reviewing a project-specific annual monitoring report that will keep IFC informed of permitting and compliance activities along with the expansion of the network of farms implementing the AgCert system. In general these summary reports will provide IFC with data covering the following: - the status of implementation of Agcert systems; - ongoing performance of project-specific environmental, health and safety - permitting and compliance programs required to achieve robust compliance with local regulatory requirements; - and exception reporting summarizing unplanned events that have occurred and the mitigation measures implemented in operations and planning to prevent reoccurrence of the event or phenomenon. Periodic site supervision visits may also be conducted.