While all Performance Standards are applicable to this investment, IFCs environmental and social due diligence indicates that the investment will have impacts which must be managed in a manner consistent with the following Performance Standards. If IFCs investment proceeds, IFC will periodically review the the project’s ongoing compliance with the Performance Standards

PS 1 – Assessment and Management of Environmental and Social Risks and Impacts
PS 2 - Labor and working conditions
PS 3 - Resource Efficiency and Pollution Prevention
PS 4 – Community Health, Safety and Security
PS 5 – Land Acquisition and Involuntary Resettlement
PS 6 – Biodiversity Conservation and Sustainable Management of Living Natural Resources
PS 7 – Indigenous Peoples
PS 8 – Cultural Heritage
If IFC’s investment proceeds, IFC will periodically review the the project’s ongoing compliance with the Performance Standards

The project has been classified as a Category A project according to IFC’s Environmental and Social Review Procedure due to potential risks and impacts associated with the operations and proposed capital investment program of CELPA which includes, among others, the construction of sub-transmission lines in forested regions of the Amazon Biome. Such state is located in its entirety within the Amazon region and most its remaining natural forests are part of the Amazon Biome.

IFC's appraisal considered the environmental and social management planning process and documentation for the project and gaps, if any, between these and IFCs requirements. Where necessary, corrective measures, intended to close these gaps within a reasonable period of time, are summarized in the paragraphs that follow and (if applicable) in an agreed Environmental and Social Action Plan (ESAP). Through the implementation of these measures, the project is expected to be designed and operated in accordance with Performance Standards objectives.

Policy

CELPA has developed and adopted a Corporate Sustainability Policy which outlines the following objectives:

Openness and transparency in communication of stakeholders;

Ethical conduct in interactions with clients and the public at large;

Application of policies and practices which contribute to the sustainable development of the concession region;

Compliance with environmental legal requirements;

Ensuring integrity and equity in the company’s relationship with suppliers;

Contribution to the sustainable development through provision of reliable, quality, service to the community;

Minimizing negative environmental and social impacts of its operations while contributing to the community through social programs;

Respective the health and safety of internal stakeholders;

Promoting environmental conservation through pollution prevention; environmental education of own workers, contractors, and the community; and technological innovation.



Identification of Risks and Impacts

Consistent with its practice and cognizant of the sensitivity involving the Amazon region, CELPA strives to construct the required sub-transmission lines in areas that are not legally protected or indigenous peoples’ lands and seeks to take advantage of existing right-of-way (ROW) alignments such as roads and highways to minimize the costs and impacts associated with land clearing. This is mainly the case with the 34.5kV and smaller transmission and distribution (“T&D”) networks.



Brazilian environmental regulations require the preparation of detailed environmental and social impact assessments (ESIAs) as part of a stepwise environmental licensing process applicable to major impacting activities. In the State of Pará, the State Secretariat of Environment - Pará (SEMA-PA) is the entity responsible for reviewing ESIAs prior to issuing a Preliminary License (Licença Prévia or LP) and Installation License (Licença de Instalação or LI) required prior to the start of construction activities of any major projects. This is followed by the issuance of an environmental operating license (Licença de Operação or LO) issued after regulatory inspection of the fully constructed project, just before commencement of operations. The typical scope for ESIAs cover environmental and social aspects, including: geology, soils, land use, water resources, flora, fauna, ichthyofauna, noise, air quality, traffic, cultural resources, and socioeconomic aspects of neighboring municipalities and communities.



In the Case of CELPA, due to the large number of new projects that have similar characteristics, SEMA developed and issued a specific norm (Instrução Normativa No. 30964 of 2007), which provides the terms of references (ToR) of environmental and social documents to be prepared by CELPA during environmental permitting of new T&D lines and substations. The procedure consists of the preparation of a form that briefly describes the project to be constructed by CELPA. The forms, alon
g with issued licenses, are available at SEMA’s webpage (monitoramento.sema.pa.gov.br/simlam/). The Instrução Normativa does not include specific requirements related to stakeholder engagement.



For the environmental permitting of the Island of Marajo Project, CELPA developed a more comprehensive study to comply with the basic requirements of a simplified environmental report (RAS – Relatório Ambiental Simplificado), as described in SEMA’s norm No. 247/CLA/DCQA/208. This norm requires the analyses of alternative ROW routes, characterization of the project’s area of influence, the environmental feasibility of the project, identification of environmental impacts and proposed mitigation and compensation measures. The RAS for the Island of Marajo Project included limited flora baseline studies and fauna characterization based on previous studies conducted in the region. Cultural resources baseline studies were conducted in accordance with the requirements and approval by the Brazilian National Institute for the Preservation of Historical and Archeological Resources (IPHAN).



At the time of the award of the original private concession about 10 years ago, CELPA inherited hundreds of assets (sub-stations and ST&D lines) without environmental licenses. CELPA is still working with regulatory agencies to secure the required environmental licenses of several of these existing assets in a process that has been taking several years to complete. As part of IFC’s investment, CELPA will be required to complete the regularization of missing or defective environmental licenses according to a specific timeline.



Going forward, CELPA will formalize into a documented procedure its current institutional practice of screening projects to avoid construction of sub-transmission lines or substations in environmentally and socially sensitive areas (i.e. conservation areas, indigenous people’s lands, and areas where involuntary resettlement would be required). CELPA will also revise the ToR of SEMA’s norms for assessment of impacts in sensitive habitats (native forests) to ensure consistency with IFC requirements. The revised ToR will include adequate baseline studies for fauna and flora to identify the presence or absence of listed species and evaluation of potential presence of Critical Natural Habitat (as defined in IFC’s PS6).



Management Programs

CELPA has a well-established corporate level environmental, health, safety and social (EHSS) management program with a detailed set of standard operating procedures. Some of these operating procedures cover aspects related to the management of EHSS aspects such as: identification of legal requirements; environmental licensing; environmental procedure for project planning and development and for construction activities; risks analysis for soil and groundwater contamination; vegetation suppression; right-of-way clearing and maintenance; urban vegetation management; erosion control; control of atmospheric emissi
ons; noise management; pollution prevention and control; solid waste management; hazardous materials management; control and monitoring of right-of ways; work in indigenous peoples land; work in ecologically sensitive areas; management of archeological and historical resources; qualification and selection of contractors; thermal power plant decommissioning; and involuntary resettlement. The above-referenced standardized procedures serve to support project-specific management plans as required for more complex construction activities.



CELPA’s activities present workers and contractors with significant occupational hazards such as exposure to high voltage and falling hazards. CELPA has developed and implemented a documented occupational, health and safety management program consisting of OHS Manual applicable to employees and contractors. The OHS Manual provides detailed OHS procedures which include such aspects as: people and materials transport safety; use of individual and group protective equipment and safety tools; work in heights; electrical safety (including detailed lock-out-tag out (LOTO) procedures); and several other aspects related to the safe installation and repair of electricity transmission and distribution networks. The OHS procedures are supported by an additional set of work procedures governing the installation and maintenance of electricity ST&D infrastructure.



Going forward, in order to update the ESMS in alignment with IFC’s requirements, CELPA will include an explicit reference to IFC’s Performance Standards in the section on applicable environmental and social legal requirements in the Company’s ESMS. CELPA will also update the above-referenced operating procedures to address the following specific IFC requirements:

Update process for selection of new contractors or renewal of existing contracts to include environmental, health, and safety (EHS) performance criteria: standards of employee occupational health and safety (OHS) training; evidence of compliance with labor laws; accident records; and records of response to CELPA’s audit findings;

Revise standard operating procedures in power stations to reduce the volume of oily wastewaters requiring treatment;

Develop and implement land acquisition and right-of-way negotiation procedures consistent with IFC PS5 requirements;

Develop and implement due diligence procedure for review of government managed resettlement in the event that this takes place in land ceded to CELPA by state or municipal authorities, defining CELPA’s role and responsibilities consistent with IFC PS5 requirements;

Develop and implement a squatter’s management procedure to formalize CELPA’s policy and approach to prevention and response to illegal occupation of transmission line ROWs, including identification of this risk prior to the construction of new transmission lines;

Develop and implement a formal IP community engagement procedure to be applied in the event that transmission or
distribution assets will be installed in IP lands. The engagement procedure shall be consistent with IFC PS7 requirements; and

Develop and implement archeological and cultural patrimony chance-find procedures applicable to construction activities which are consistent with Brazil’s IPHAN and IFC PS8 requirements.



Organizational Capacity and Competency

Management of environmental aspects is presently assigned to an environmental unit led by a qualified group Environmental Manager and staffed by an additional four (4) qualified professionals responsible for oversight and implementation of environmental licensing and monitoring processes, including licensing of projects in remote regions of the State of Para. Financial constraints have led to significant turnover rates in some of the administrative functions and occupational health and safety (OHS) aspects are presently managed by an interim coordinator, who reports to the Human Resources (HR) Department. The OHS coordinator is supported by regional supervisors who oversee field implementation of company safety requirements by employees and contractors. Human resources management is well staffed with an HR Manager and sector coordinators. Social aspects are covered mainly through CELPA’s corporate social responsibility activities which have been reduced over the last few years due to financial constraints.



Moving forward, CELPA will hire an experienced OHS Manager and replace OHS auditors lost through attrition. In addition, CELPA will complement the environmental management structure with the assignment of competent professionals at the sub-regional level in order to provide the right level of support for the large number of simultaneous environmental licensing processes in different regions of the State of Para, as well as the increased need to supervise contractors’ environmental performance in remote regions.



Emergency Preparedness and Response (EPR)

In order to comply with Brazilian regulatory requirements, CELPA is required to develop occupational health and safety plans and procedures applicable to construction activities which include emergency preparedness and response as well as EPR plans for operating assets such as power generating facilities. EPR plans include such aspects as coordination with external entities; use EPR response equipment; emergency contacts; training (including maintenance of a registry); response procedures to address fires, electrical shock, short circuits, explosions, lightning, floods, and landslides; and fire brigades.



Monitoring and Review

Through the public website of its former corporate owner, CELPA has tracked and published a series of environmental, health, safety, and social performance indicators as part of an annual sustainability report. The latest report covering the 2011 period included indicators for aspects such as: hazardous and non-hazardous solid and liquid wastes generation; number of environmental licenses obtained
; environmental education outreach activities; use of insulated cabling (as a measure of public safety to prevent accidental contact with non-insulated cable); number of fines received from regulatory agencies; and total energy and fuel consumption. However, monitoring of EHS and social performance appears to be inconsistent and does not always include performance of key service providers (i.e. construction and maintenance companies) or to be used for the purposes of change management.



Going forward, CELPA will institute monitoring programs for key E&S indicators and performance measures, including but not limited to OHS incidents with employees and contractors and oil/water separator effluent discharges, among others. CELPA will also prepare E&S performance reports to communicate to Company management key aspects of ESMP implementation (including at a minimum: OHS accident rates and trends, status of Notices of Non-Compliance (NOVs or TACs) and other key issues of potential significance). Management reports shall be prepared at a minimum on a quarterly basis or more frequently as determined by the Company Management.



External Communications and Grievance Mechanisms

As the only electric power distribution company in the State of Para, CELPA is a highly visible entity be it through the relationships it has with its costumers or due to its active role in the provision of electricity to underserved communities of the State. In addition, CELPA has limited social programs that provide environmental awareness to children at local schools and the aforementioned “Transparency Program” through which the Company provides basic information about energy efficiency and safety to its customers. CELPA publishes an Annual Sustainability Report that presents the Company’s performance indicators and initiatives. However, the State Environmental Agency’s (SEMA) current environmental permitting requirements do not include provisions for stakeholder engagement in the development and construction of new projects, mainly because most projects consist of the installation of low tension distribution lines along existing roads.



Going forward, CELPA will develop a stakeholder engagement plan which defines engagement and disclosure levels appropriate to the level of adverse environmental impacts of specific transmission and distribution projects, consistent with IFC stakeholder engagement requirements. CELPA will also develop and implement a robust Grievance Redress Mechanism consistent with IFC PS1 requirements.



On-going Reporting to Affected Communities

Public reporting requirements in Brazil are defined on a project-specific basis. In the absence of community engagement and reporting requirements associated with the environmental licensing of new projects, CELPA’s external reporting has mainly consisted of the preventive safety information distributed to clients as well as E&S performance summaries published in annual sustainability reports publ
ished in the external website. This approach is appropriate for the vast majority of CELPA’s projects consisting of the installation of low tension distribution lines along existing roads.



Going forward, CELPA will develop and implement a Project-specific environmental and social reporting program for the communities located in the projects’ direct area of influence, commensurate with the potential risks and impacts of the specific project. CELPA will also continue to disclose indicators of environmental and social performance applicable to CELPA’s construction and operational activities (such as those already published in recent annual Sustainability Reports).

Working Conditions and Management of Worker Relationship

CELPA presently has a workforce of approximately 2,100 direct employees and 3,500 sub-contractors, most of who are dedicated to the construction and operational maintenance activities. Working conditions and company policies are defined in individual employment contracts which make reference to such aspects as: working hours; salary; overtime payments; payment schedule; deductions for company benefits and insurance policies; safety norms; intellectual property rights; and confidentiality of company trade secrets, among others. CELPA has also drafted a brief Code of Conduct where the Company defines a series of policies including: commitment to avoid all types of harassment in the workplace; non-discrimination in the hiring and promotion process; confidentiality of personal information; conflicts of interest; respectful work environment; and whistleblower protection, among others.



The Company actively encourages employees and managers to openly discuss and resolve conflicts. Employees are currently able to lodge complaints internally through the Human Resources department and Company management and externally through the public Labor Rights system (Justiça do Trabalho).



Going forward, CELPA will develop and implement a human resources policy consistent with IFC Performance Standard 2 and national labor laws. The HR policy will make explicit reference to the Company’s commitments to non-discrimination and equal opportunity; minimum work age requirements; workers’ rights to freedom of association; respect for collective agreements, if these are present; maximum working hours; and working conditions and terms of employment. The Company will also create and implement a formal internal grievance according to IFC Performance Standard 2 requirements.



Workers’ Organizations

IFC found no evidence that Sponsor restricts freedom of association of its employees. In Brazil, workers normally affiliate with local or regional labor unions organized to cover their specific industry activities.

In the State of Para, CELPA’s employees belong to one of two trade unions: 1) Sindicato dos Engenheiros no Estado do Para (Engineers’ Syndicate in the State of Para (http://www.sengepa.com.br/)) and 2) Sindicato dos Trabalhadores nas Industrias Urbanas do Estado do Para (Syndicate of Urban Industries’ Workers in the State of Para (http://www.urbanitarios-pa.org.br/)). The Company and these Unions have signed Collective Bargaining Agreements for the 2011-2012 period which covers key labor aspects such as: salaries; working hours; contracting and layoffs; labor stability; benefits, rights and responsibilities; occupational health and safety; workers organization and union relations; and contributions to the union. Copies of the respective agreements can be found at: http://www.sengepa.com.br/ACTs/Acordo_2011_2012_Celpa.pdf, and http://www.urbanitarios-pa.org.br/index.php?option=com_flippingbook
&view=book&id=1470:celpa&catid=9:ultimos-acordos



Retrenchment (Reduction of the Workforce)

In the event that CELPA’s restructuring process results in the need to reduce the workforce, the company will develop and implement a retrenchment plan, in consultation with the trade unions, and in alignment with IFC PS2 requirements. In this event, CELPA will also prepare a management report documenting how the retrenchment process was implemented consistent with the requirements of PS2.



Protecting the Workforce

Brazilian labor laws prohibit discriminatory practices and define minimum of age of work. The Company complies with local requirements, supporting equal opportunity and non-discrimination in employment and requiring all prospective employees to demonstrate proof of age of 18 years or older. Employment contracts and the Company’s employment rules do not allow for circumstances that could be construed as forced labor.



Occupational Health and Safety

According to Brazilian legal requirements, the Company and its contractors are required to develop and implement a series of occupational health and safety (OHS) management programs, including: Medical Surveillance Program (PCMSO, Programa de Controle Médico e Saúde Ocupacional); Internal Commission for Prevention of Accidents (CIPA, Comissão Interna de Prevenção de Acidentes); Personal Protective Equipment (PPE) Program; and Environmental Risk Prevention Program (PPRA, Programa de Prevenção de Riscos Ambientais). The Company also has a detailed OHS operational procedures as previously described in this summary. Nevertheless, CELPA has among the highest occupational health and safety accident frequency and severity rates among Brazil’s more than 60 electric sector concessions according to statistics published by the electric industry non-profit foundation FUNCOGE (http://www.funcoge.org.br/). Accident rates among CELPA’s contractors are significantly higher than those involving CELPA’s own employees (http://www.funcoge.org.br/csst//relat2010/index_pt.html). The challenges with occupational health and safety accident rates are associated with the expanse of CELPA’s operations throughout the State of Para and with the Company’s limited OHS resources to effectively supervise work by contractors in remote regions of the Amazon.



Additionally, CELPA has received, or is party to, two Notices of Violations (NOVs) presented by public prosecutors in the State of Para related to high occupational accident rates among the Company’s employees and subcontractors and one NOV related to the need for the Company to create an employee Code of Conduct to address issues of harassment in the workplace.



Going forward, CELPA will develop and implement a detailed training program for contractors consistent with local and IFC requirements. Additionally, CELPA will conduct periodic audits of key service providers such as contractors responsible for construction and maintenance of ST&D lines and transf
ormers’ maintenance shops. Further, CELPA will engage with local authorities and will develop a time-bound action plan to come into compliance with the public prosecutors’ NOVs and terms of commitment (TACs) for issues related to occupational health and safety risks among its employees and subcontractors.



Workers Engaged by Third Parties

CELPA has subcontracts with a large number of companies primarily to support the construction and maintenance of the rural electrification networks and for any major sub-transmission construction projects. CELPA also subcontracts heavy equipment maintenance (overhaul of transformers); vehicle fleet maintenance; electric meter reading; part of the call center operation; cafeteria; cleaning and security services. The total number of workers engaged by third parties is about 3,500.



CELPA’s service providers are contractually required to comply with the labor laws of Brazil as well as to follow CELPA’s OHS management procedures. CELPA requires contractors to show proof of compliance with their obligations and employers including, for example, proof of up-to-date social security payments together with the required registry of employees, which also serves as proof of payment of salaries.



CELPA’s OHS management procedures, particularly those related to the electrical hazards, are applicable to both direct employees and those of subcontractors. These procedures require contractors to abide by the findings and corrective actions identified by CELPA in the course of OHS audits. OHS procedures also include minimum contractor training standards. These procedures will be strengthened with IFC’s aforementioned requirement for CELPA to improve contractor training and monitoring.

Management of Waste Streams

CELPA’s operations generate solid and liquid waste streams at the Company’s offices, substations, power generation units, equipment and fleet maintenance, ST&D construction and maintenance and from street lights.



Good waste management practices include the return of potentially hazardous wastes to the original product manufacturers for such wastes as old mercury lamps, alkaline and acid base batteries, and used tires from the Company’s fleet. Domestic wastes generated at CELPA’s offices (e.g., paper, cardboard, plastic bottles, organic waste, etc.) are segregated for recycling and non-recyclable wastes are disposed at municipal landfills. CELPA industrial operations generate large volumes of used light bulbs, batteries, used filters, used oil, electric wires/cables, used transformer oil, etc. Volumes of wastes generated, stored and disposed are entered into the Company’s ESMS. Records and reports documenting the transport and disposal of such waste streams are maintained by the environmental division.



Diesel power generation stations make use of gravity oil/water separators to control oily fluids (from spills in the diesel tank secondary containment, water draining from diesel tanks, management of waste oils, and engine cleaning and maintenance). CELPA reports that no monitoring of treated effluent quality is conducted. Effluents are presently discharged into leachfields. Going forward, the Company will revise standard operating procedures at the thermal power stations to reduce the volume of oily fluids that require treatment at the onsite oil/water separators. In addition, CELPA will develop and implement a program to monitor discharges from the oil/water separators and to implement corrective actions, as required, to address deficient performance.



Noise is emitted from the diesel power plants and, sometimes, from buzzing or humming of high voltage transformers in sub-stations. CELPA reports that the Company monitors noise levels at its power generation stations and reports that there are plans for the implementation of corrective actions, where applicable, to comply with Brazilian occupational health and safety and ambient noise standards.



Hazardous Materials and Oil Management

CELPA does not use significant quantities of hazardous materials during construction or operation activities. The insulating oils used in the transformer are of mineral origin. Additionally, the majority of power transformers, which contain the greatest quantities of oil, are typically installed on top of concrete containment structures that can hold the contents of the transformers in the event of an accidental release.



In 1998, the government of Brazil privatized the electrical sector and CELPA’s concession was awarded to Rede Energia. In the years following its privatization, CELPA conducted environmental site assessments to identify potential environmental liabilities from past operations and also initiated
the process to obtain environmental licenses for existing facilities. Since 1981, Brazilian law has banned the use of polychlorinated biphenyl (PCBs) in new equipment. CELPA reports that by 2000, old transformers that used PCB had been replaced and PCB-containing oils were incinerated at authorized facilities and that no environmental contamination by PCBs has been reported in any of its facilities.



CELPA reports that between 1999 and 2001, the Company worked in close coordination with SEMA to obtain the environmental licenses for the diesel power generation stations. SEMA required that CELPA conduct environmental site assessments of operational and decommissioned diesel power generation stations to determine potential contamination by hydrocarbons. CELPA identified 28 sites that required remediation of soil and/or groundwater. In 2002, CELPA started the remediation of five sites considered as critical. In 2006, CELPA conducted additional environmental site assessments at its operating facilities. To date, CELPA has remediated 22 sites. There are four sites that are currently undergoing remediation and six sites to be remediated. Documents reviewed indicate that CELPA’s environmental consultants apply remediation standards from CETESB, the State of Sao Paulo Environmental Agency, and that standard site management practices have been adopted. CETESB’s remediation standards consist of a risk-based approach that is consistent with IFC’s approach to contaminated site cleanup.



CELPA reports that the Company does not apply pesticide or herbicides in its operations. ROW and grounds maintenance include mechanical controls (i.e., vegetation trimming or suppression).



Atmospheric Emissions, Including Greenhouse Gases (GHGs)

The main sources of atmospheric emissions in CELPA’s operations include combustion sources from diesel power generation stations and from the Company’s vehicle fleet. All of CELPA’s diesel power stations (and that of their subcontractor GUASCO) are below 50MWth installed capacity and some are even below 3MWth. They are mainly located in remote areas of the State of Para, away from large urban centers. CELPA indicates that these facilities use No. 2 diesel fuel which in Brazil contains less than 2% sulfur. Therefore, these facilities are not considered significant sources of emissions.



Additional sources of GHG emissions include the gas SF6 used for isolating purposes in switching equipment and indirect emissions from the production of electricity for own consumption. Information presented in the Company’s 2011 Annual Sustainability Report shows that for the year 2009, CELPA emitted 282,903 tons of CO2-equivalent. Through the implementation of the Marajo I and II Projects, the Company expects to retire approximately 15 diesel power generation stations over the next 2 to 5 years, thus reducing its annual GHG emissions. As CELPA continues to increase its ST&D network, additional isolated thermal generation stations
will be decommissioned. In addition, CELPA has signed an agreement with Eletrobras and GTZ, as part of the Araras Project, an experimental program to expand the use of hybrid systems (i.e. solar / wind / diesel; use of biodiesel; etc.). The Araras Project’s main objective is to meet the need of isolated communities and users that cannot be connected to the grid because cost-benefit analyses deem these connections economically infeasible. The Arara Project is a government-subsidized program and CELPA is currently assessing the results of initial pilot sites.



Energy Efficiency

Given that the greatest opportunity for improvement in energy efficiency lies with the company’s reduction in technical losses and improved efficiency of end users (customers), CELPA has historically planned and implemented programs to promote and invest in improvement of both of these areas. In 2011, CELPA implemented a project to replace low-efficiency traffic lights in the Municipality of Belem with high-efficiency LED sets. In addition, as part of the sub-program “Low-income” that is included in the “Luz Para Todos” program, CELPA subsidizes the distribution of high-efficiency light bulbs and refrigerators to low-income households. Additionally, CELPA has developed methods to reduce or eliminate illegal connections to the distribution network. These theft reduction efforts have resulted in significant increases in energy efficiency due to the reduced overload of the system.

Infrastructure and Equipment Design and Safety

CELPA has programs to educate communities about the hazards associated with accidental contact with electrical equipment in public areas. The company provides instructive information to communities in presentations at schools or at home, via brochures, or via the internet on such issues as the safe use of electricity in the home, staying away from broken transmission and distribution cables, avoiding illegal access into the Company’s lines, warning the children about the dangers of playing near lines, and other general safety precautions around electric installations. Additional preventive measures include the increasing use of insulated wiring in low tension distribution lines which, together with the increasing use of an innovative enclosed metering system, has almost eliminated energy theft, one of the most significant causes of accidents. The company monitors the total number of accidents and fatalities associated with interactions between the community and the distribution infrastructure. Over a period of 3 years (i.e., 2009 through 2011), there were approximately 41 accidents per year involving members of the communities.

During the initial planning phase of new ST&D line routes, CELPA follows an informal procedure to avoid legally protected areas. In the event national parks or conservation areas are to be affected by a proposed ROW, SEMA would need to coordinate with the Brazilian Institute of Environmental Protection and Natural Resources (Instituto Brasileiro do Meio Ambiente e dos Recursos Naturais Renováveis - IBAMA) and with the Chico Mendes Institute for Biodiversity Conservation (Instituto Chico Mendes de Conservação da Biodiversidadeduring – ICM-Bio), which manages many of the federally protected lands. IBAMA and ICM-Bio would develop mitigation and compensation measures to be adopted by CELPA and its contractors.



As previously noted, CELPA will be required to revise the Terms of Reference (ToR) of ESIAs for sensitive habitats (natural forests) and develop appropriate management plans to avoid and mitigate impacts in according with IFC PS6. The quality and detail of the ESIAs will need to be sufficient to identify and classify the type of habitats dividing them as defined in PS6 into modified, natural, and critical. The baseline surveys of biodiversity data of these ESIAs will include literature reviews and field surveys to provide necessary information to determine Critical Habitat or Natural Habitat and corresponding important biodiversity values, and to help monitor the status biodiversity over time to assess the project’s compliance with PS6. These surveys will need to be completed by qualified biodiversity experts who know the flora and fauna of the Brazilian Amazon, based on a combination of efforts including, for example: use of satellite imagery and vegetation maps to determine major habitat types within the project footprint and surrounding area; field surveys within each major habitat type, typically with a minimum of five days and nights sampling for all taxonomic groups; sample of unique micro-habitats within each habitat type. Surveys will need to be completed following international standards for sampling protocols.



Depending on the results of the ESIAs, CELPA will need to consider potential impacts to biodiversity and ecosystem services, especially focusing on habitat loss, degradation and fragmentation, among others, and may need to prepare biodiversity management programs consistent with the nature of the impact. Management approaches for the protection and conservation of biodiversity will be based on the mitigation hierarchy including biodiversity offsets, which may be considered only after appropriate avoidance, minimization, and restoration measures have been applied. Impacts to Natural Habitat will need to demonstrate no net loss of biodiversity while impacts to Critical Habitat will be required to demonstrate net positive gain of the important biodiversity values identified.



During the construction of the Island of Marajo Project Phase I, ICM-Bio and IBAMA issued NOVs to CELPA due to a contractor that deviated fro
m the permitted ROW alignment, entering and clearing 187.55 ha within the multiple-use reserve Arioca Pruanã that is managed by ICM-Bio. The NOV resulted in a suspension order for a period of three (3) months, which has been lifted while pending outcome of legal process. This type of situations will be prevented with increased oversight from CELPA as a result of aforementioned improvements in its environmental and social management systems, including additional organizational capacity.

During the initial planning phase of new ST&D line routes, CELPA follows an informal procedure to avoid legally protected areas. In the event that an indigenous people’s (IP) territory is to be affected, CELPA negotiates directly with the National Foundation of Indigenous Peoples (Fundação Nacional do Indio – FUNAI), the federal entity responsible for the establishment and implementation of policies related to indigenous peoples in Brazil. CELPA reports that based on its experience, FUNAI only allows proposed ST&D lines to be constructed within an IP territory if the electrical energy is to service the communities located within that territory. According to CELPA, FUNAI is typically unwilling to allow proposed ST&D lines to cross IP territories if such lines do not directly service the community. FUNAI is the entity in Brazil responsible for defining, in consultation with IP communities, the mitigation and compensation measures to be implemented when new ST&D lines are to be constructed within IP territories. As previously noted, CELPA will formalize its current practice of screening projects to avoid construction of ST&D lines or substations in socially sensitive areas such as indigenous people’s lands as well as develop an IP engagement procedure consistent with IFC PS7.

During the environmental permitting process of new ST&D and substations, CELPA’s secures the services of qualified and certified cultural resources specialists to conduct studies in accordance with the requirements by the National Institute of Historic and Artistic Heritage (Instituto de Patrimônio Histórico e Artístico Nacional - IPHAN). The qualified cultural resources specialist coordinates with IPHAN to carry out field surveys and potential rescue and restoration, as deemed necessary by IPHAN. Documentation associated with the environmental permitting of the Island of Marajo Project Phase I, shows that CELPA’s qualified cultural resources specialist has coordinated with IPHAN and obtained the due authorizations from this agency. As previously noted, CELPA will formalize its procedures for chance finds during the construction of new ST&D, substations and renewable/hybrid power generation stations.

The communities potentially affected by the company’s operations are also its customers. CELPA’s two principal means of communication with its customer include the call center, which operates 24 hours a day, seven days a week, and face-to-face meetings at CELPA’s main office in Belem and at CELPA’s branches at 158 locations throughout the State of Para. In 2011, CELPA logged 11.2 millions customers’ contacts via the various means of communication. The majority of the calls are customer-service related. CELPA also liaises directly with PROCON, the agency that protects Costumers’ rights. CELPA’s website is designed to allow customers to log their complaint in accordance with the categories required by the Brazilian government (http://www.redenergia.com/celpa/fale-conosco/).

Formal community engagement activities are complemented by a series of more informal activities including educational presentations to communities who are part of the “Luz Para Todos” Program and for those who are gaining access to electricity for the first time. These educational presentations, conducted in all small rural communities reached by this program, focus on the safety and efficient use of electricity. CELPA’s “Transparency Project” provides additional direct engagement with communities. A specially equipped vehicle is used to provide demonstrations to local communities of how electricity works and of common measures to prevent injuries and to improve energy efficiency. In 2011 the “Transparency Project” reached approximately 8,000 people.

Copies of environmental and social impact assessments conducted for new projects will be made available for public view at the following location:

Centrais Elétricas do Pará S.A. – Celpa
Rodovia Augusto Montenegro, km 8,5 | Belém - PA | CEP 66823-010 |
Call Center - 0800 091 01 96

Broad Community Support is not applicable for this project