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 6 – Biodiversity Conservation and Sustainable Management of Living Natural Resources
If IFC’s investment proceeds, IFC will periodically review the the project’s ongoing compliance with the Performance Standards

The proposed CSP plant is a Category B according to IFC’s Policy and Performance Standards on Environmental and Social Sustainability because a limited number of specific environmental and social impacts that may result from their construction and operation can be avoided or mitigated by adhering to generally recognized performance standards, guidelines or design criteria.

Key environmental and social issues associated with CSP power plants include the developers’ and contractors’ capacity to undertake adequate mitigation measures commensurate with the adverse impacts, and in consultation with locally affected populations, during both construction and operations phases, particularly with regard to: i) surface water resources; ii) fair, safe and healthy working conditions for both construction and operations work force; iii) wastewater, solid and hazardous waste; iv) handling and storage of hazardous/harmful chemicals and v) impacts of construction and operations on the natural flora and fauna, and the human populations surrounding the project area. IFC’s project appraisal considered environmental and social management issues and plans for the project, and gaps between these plans and IFC requirements. Corrective measures intended to close these gaps within a reasonable period of time are summarized in the paragraphs below and in the agreed Environmental and Social Action Plan (ESAP) disclosed in this review summary. Through the implementation of these management plans the Project will be designed and operated in accordance with Performance Standards objectives.

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.

IFC’s assessment considered: The Project Companies’ management of its environmental, health and safety performance in the establishment and operation of its facilities; and compliance with national and local permitting requirements.

Environmental Assessment: South Africa has the most comprehensive EIA and impact management requirements in all of sub-Saharan Africa. Reputable consultancies and technical specialists have compiled the EIA for the power plant. The EIA is believed to be of an international standard and was granted the requisite authorization by the Department of Environmental Affairs (DEA) in April 2011. The same authorization was amended for the Project and was issued on July 23 2013.



The overall assessment, as well as associated specialized studies, follows the standard protocol of studies of this type to establish the nature, extent, duration, magnitude, probability and significance of potential impacts. In addition to a general assessment of impacts, the EIA contains specialized assessments of impacts on the ecology, avifauna, geology and soil conditions, hydrology and water resources, cultural heritage and visual impacts of project infrastructure. The EIA also contains a comprehensive socio-economic profile of the areas and consideration of both negative and positive impacts, including cumulative impacts, and a full record of public consultation and comment.The most significant environmental impacts associated with the proposed project identified by the EIA studies include: impacts on water resources and visual impacts on the natural scenic resources of the area due to disturbance and modification of the site, and the presence of construction workers on site. The studies conclude that: i) there are no environmental fatal flaws that should prevent the Project from proceeding; ii) the predicted ecological impacts are of medium to low significance; and iii) the local employment benefits offered by the construction and operation of the Project outweigh the potentially negative social impacts. The studies conclude that, subject to the implementation of recommended mitigation measures, the Project will comply with the requirements of the DEA.



Environmental Permitting: While it is considered that the sharing of certain infrastructure between the project phases (where such does not prejudice any of the projects and where consent has been obtained from the required authorities and the lenders involved with the different phases) could be advantageous, in order to account for unforeseen complications, the Project Company confirmed that separate permits for the individual phase of the Project will be sought from the South African authorities. Prior to receiving confirmation that the Project has permission to share facilities with the !Kaxu (Phase 1) project from the Department of Energy, this assumption remains a risk, and is raised in the ESAP as a requirement prior to disbursement.



Additional (temporary) permits may be requi
red from the National Department of Environmental Affairs, the Provincial Department of Transport, the South African National Roads Agency Limited and/ or the Department of Health in relation to specific activities during the construction process e.g. tree removal, transportation of abnormal loads on provincial roads, transport and storage of hazardous substances. The company will retain responsibility for obtaining these licenses and permits and based on discussions during the site visit, however it is unlikely that obtaining the temporary construction licenses and permits will be an issue. The company is aware of its obligations in this respect and this requirement should not represent an issue for the project progress.



Management, Monitoring and Reporting: The EIA included a comprehensive Environmental Management Plan (EMP) that outlines measures to be implemented for the planning, construction and rehabilitation, operation and decommissioning phases of the! XiNa CSP plant so as to manage and minimize the extent of potential environmental impacts associated with the facility over the life of the Project. The EMP summarizes appropriate management plans to control air quality (e.g., dust management), erosion and sediment, soil contamination, spill incidents, impacts on terrestrial ecology, water quality, noise and vibrations, traffic and transportation of materials and equipment and waste management during construction and operations.

The EMP is also structured to ensure compliance with the requirements of all environmental authorizations, permits and obligations established by the relevant environmental legislation. In addition, the EMP incorporates the recommended mitigation measures identified in each of the EIA specialized studies (ecology, avifauna, geology and soil conditions, hydrology and water resources, cultural heritage and visual impacts of project infrastructure) into a set of actions and/or controls – each with its specific performance indicators and monitoring regimes – to ensure adequate impact mitigation at each of the Project stages. The EMP further identifies personnel responsible for implementation of each action and the timeframe in which those actions must be implemented. The company will be required to confirm the CSP plant’s compliance with the EMP and DEA Authorization requirements as part of its annual environment and social reporting to IFC.

The Project Companies will appoint a Project Manager and Site Manager for each CSP plant. These managers will have environmental management responsibilities incorporated into their terms of reference that include familiarity with the EIA, EMP and the requirements of the DEA’s Authorization, as well as responsibilities to ensure that engineering contractors and service providers observe all environmental and social impact mitigation provisions detailed in those documents. These managers will be supported by an Environmental Control Officer (ECO) who will monitor contractor
compliance with the provisions of the EMP on behalf of the DEA as required. The ECO will have the authority to stop the work of any contractor or service provider found in violating the proscriptions of the EMP. The ECO will compile regular performance reports, which may include corrective actions, for project management and DEA.

IFC’s review considered Project construction and operations with regard to fair, safe and healthy working conditions.

Employment opportunities and accommodation: Construction activities associated with the Project will generate short-term employment for an average of an estimated 690 posts over the construction period, and peak at an estimated 1.360 posts during the mechanical erection phase. The XiNa CSP plant’s operations are expected to directly employ 45 people on a permanent basis. The Company estimates that at least 35of this labor requirement will be for skilled labor and, thus, can be recruited from communities surrounding the project sites if adequate labor resources exist. The EIA did not address specific labor accommodation or contractors camps, but did assess potential environmental and social issues associated with the deployment of labor in the social specialist impact assessment. It is assumed by the project and the EPC that subcontractors will make use of existing accommodation in the Pofadder, Kakamas, Keimoes and Upington areas. Significant additional accommodation has been created in these areas to house workers involved with the KaXu project which will be available when the XiNa project starts. In order to ensure that workers are housed in decent accommodation and that they will have access to adequate security, water, sanitation and waste removal services, a labour accommodation plan will be developed in accordance with the IFC/EBRD Guidance on Worker’s Accommodation: Process and Standards (August 2009). Compliance with this Guidance note will be incorporated into the EPC contract. This will also be subject to the requisite monitoring as specified under PS2 in addition to complying with national legislation. This is articulated in the ESAP.



Employment conditions: The companies will develop a Human Resources Policy and management system consistent with South African labor laws and the requirements of Performance Standard 2 for its operational personnel, as has been the case at the nearby Phase 1 project. Each employee is expected to have a contract and understand their working rights related to hours of work, wages, overtime, compensation, and benefits upon beginning the working relationship and when any material change occurs. In addition, either together or separate from the HR Policy, the Employee Handbook shall reflect company commitments against the use of forced labour or child labour, and statements indicating that they will not seek to influence or control any workers’ organisations or collective bargaining rights. The HR Policy will show a commitment to make employment decisions based on inherent job requirements, non-discrimination and equal opportunities. In addition, the Project Company will incorporate a grievance redress mechanism and disseminate information on how workers’ (including construction contractors) take advantage of that mechanism.



Health and Safety: With regard to the construction phase, t
he EPC Contractor has produced a Health and Safety Plan which complies with the Department of Labour, Occupational Health and Safety Act, 1993, Construction Regulation 2003 and international and European good practices. The companies will monitor the implementation of the plan during construction, as well as compile an occupational health and safety plan to accompany or be part of an updated EMP to address occupational health and safety risks for the operational phase.

IFC’s review considered the Project’s management of resource use and waste disposal on the surrounding human and natural environment in its operations.

Water Resources: The area of South Africa’s Northern Cape Province considered most suitable for CSP is a vast, arid and sparsely populated scrub-land (2.2 persons per km2) that supports low density sheep and cattle farming and one of the major table grape growing industries in the world. That industry is dependent on irrigation from the Orange River, South Africa’s largest, and most controlled watercourse. The Orange River is estimated to have a surplus of 44 million m3/year after abstraction of water to meet existing demand for irrigation and municipal services. The national Directorate of Water Resource Planning has accounted for the use of a portion of this surplus for alternative energy technologies.



The assessment within the EIA was based on water requirement of approximately 2.5 million m3 per annum assuming wet cooling and generating capacity of 310MW. The Project Company has subsequently clarified in their initial approach to the Department of Water Affairs that the Kaxu Phase 2 Project requires approximately 200,000m3/year during construction and 400,000m3/year during operations. This latter water quantity will comprise: 75,000m3 for mirror washing; 150,000m3 assumed in evaporation/drift losses; 10,000m3 for potable water use and 165,000m3 discarded in the evaporation ponds. The Project Company has stated that the parabolic troughs will be cleaned using de-mineralized water, which will subsequently be discharged to the ground. Given the change in technology from heliostats to parabolic troughs, the EMP will be updated to ensure that any chemicals (if used) and wastewater used in washing mirrors are considered.



The Project Company will be required to seek an integrated water use license (WUL) for XiNa CSP from the Department of Water Affairs (DWA) though has already received conditional notice from the Department that sufficient water is available to meet the Project’s requirements. It is understood that the Water Report was approved by the DWA and that formal application for the license has been made. The final authorization for the WUL will be sought upon appointment as preferred bidder.



A concern raised during the public consultation process was the need to maintain the ecological flow at the mouth of the Orange River. This project will permanently remove water from this river and as such its water use requirements are required to be considered alongside all the other water use requirements along the river (existing and future) in order to ensure the correct flow is maintained at the river mouth. This will be managed through the water use licensing process where this, and other projects, is considered for their water requirements. The Orange River is an International Waterway and, as such, IFC will inform the Government of Namibia of its intent to finance the CSP plants.


Water and Wastewater Management: Water requirements for the operation of the XiNa power plant is kept to minimum thanks to the use of a dry cooling process. The project will withdraw water via electric pump from an established abstraction site on the Orange River approximately 30kms from the site. Water will be pumped through a sand filter station (featuring a backwash system for compliance with zero liquid affluent design) to a storage pond located on the project site. The water pipeline will be buried along the alignment of an existing access road to the abstraction point maintained by an established grape farm. Both reservoirs will be equipped with floating lids to reduce evaporation. 

The waste water treatment plant will treat and recover a portion of the different effluents of the plant in order to minimize the consumption of raw water and the final effluents of the plant. Evaporation ponds will be considered for final disposal of effluents. The chemical dosing system provides the dosing of chemicals to the water-steam cycle to ensure correct water and steam quality, according to equipment manufacturers’ requirements. The cooling water system dosing is located next to the auxiliary cooling tower basin. The function of this system is the dosing of reagents to the circulating water and to the closed refrigeration circuit for corrosion prevention and monitoring purposes. The thermal cycle blow down will be recycled whenever possible.



The brine that will accumulate in this pond through evaporation will be removed at project decommissioning by a licensed waste management company for disposal at an appropriate waste site. The blow down pond will be lined with an impervious membrane.

The CSP plant is designed with a zero-liquid discharge system to treat all aqueous effluents according to their level of origin and contamination. However, the EIA did not assess the impacts associated with the production, handling and disposal of sanitary wastewater during both construction and operational phase as calculated quantities does not trigger any listed activities under the NEMA. The EPC Contractor Technical Proposal (Chapter 6.1.12, reference: 4D/6212-Rev.1) states that sanitary wastewater will be treated on site then sent to a wastewater (homogenization) tank prior to final disposal in the evaporation pond. After the life of plant, the built up solids will be removed by a professional licensed operator for off-site disposal at a licensed landfill site.



Solid Waste and Hazardous Materials Management: Waste generated by the XiNa CSP plant will be limited to solid waste construction materials, spent vehicle and construction machinery lubricants and other chemical wastes (adhesives, abrasives, paints and solvents) used in the assembly and maintenance of power plant components. The EMP contains specific provisions for the transport, storage, handling, use and disposal of lubricants and chemicals as well as to contain and respond to leaks, spills, or
other emergency situations during construction and operation. The Heat Transfer Fluid used in parabolic trough plants is a petrochemical and must be managed as a hazardous material. The molten salts used to store heat in CSP plants are not considered hazardous materials.

GHG Emissions: Carbon emissions associated with the CSP plant will include vehicle operation during construction and operations, and two single 2 MVA diesel generators used to supply construction power to the site. The operations of the combined projects represent a reduction in carbon emissions generated by coal or other non-renewable source amounting to approximately 330 Million tons per year.

IFC’s review considered the Project Companies’ capacity with regard to the management of the impacts of the operation of its facilities on the health, safety and security of surrounding communities. Impact on surrounding communities: A Social Impact Assessment (SIA) assessed the potential impacts associated with the Project during construction and operation on neighboring communities. The potential impacts include road safety as a result of heavy vehicle movement during construction, risks of accidental fires, and the influx of laborers in the area during construction. With the implementation of mitigation measures highlighted in the SIA and EIA report, these impacts are considered negligible and can be adequately managed through the EMP. In addition, long-term impacts on families and communities as a result of the presence of construction workers (i.e. HIV/AIDs and unplanned pregnancies) have been assessed within the SIA. Some of the mitigation measures identified within the SIA are not included within the EMP (December 2010), such as implementation of HIV/AIDs awareness programme for all the construction workers.

The Project site is not in proximity to any landscape features that attract tourism to the area (e.g., the Augrabies Falls National Park).



Life & Fire Safety: community members raised concerns during the EIA consultation regarding bush fire hazards, which may directly affect their farming livelihood. Measures have been identified in the EIA to mitigate the fire risks during construction phase and this can be managed through the measures proposed in the Project EMP and developed by the EPC Contractor. The Owner/Operator will ensure local community members are made aware that emergency procedures exist, in particular if individual farmers are in the evacuation zone, and to ensure relevant local institutions (police, fire brigades) have the necessary capacity to carry out their envisaged roles.

Security Forces and Community Safety: No site security arrangements have yet been developed. IFC will require the Project Companies to develop a comprehensive security protocol for its direct employees or security contractor(s) consistent with the requirements of Performance Standard 4. Emergency Preparedness and Response plans have not yet been established for the Project. Emergency Preparedness and Response Plans will therefore be developed for the construction and operational phase of the Project and prior to each stage commencing, in coordination with the Pofadder municipal authority who will respond to leaks, spills and other emergency situations.

IFC’s review considered the impacts of the construction and operation of the Project on the terrestrial and aquatic ecology of the habitats affected by project infrastructure.

Biodiversity: The EIA included a comprehensive ecological assessment of the Project site to determine the impacts of the major infrastructure components of the CSP plant – access road; the solar array (mirror field), power block and related structures, overhead power transmission line; and water pipeline and associated infrastructure – on the habitat and ecological processes. The assessment identified the potential impacts to the following receptors: i) indigenous natural vegetation; ii) threatened plants; iii) protected tree species; threatened animals; and iv) wetlands. The assessments also considered change in surface water runoff and drainage patterns and the establishment of invasive plant species to be potential adverse impacts of the power plants.

The Project sites are situated on rangeland that has been used for commercial stock rearing for nearly 100 years resulting in degradation of natural vegetation. As part of the ecological assessment of the project areas, a sensitivity assessment was undertaken by a specialist to identify areas of high conservation value or that may be sensitive to disturbance.

The consensus of the EIA study is that there will be negligible impacts on terrestrial and aquatic fauna, birdlife or flora during both the construction and operation of the projects. The disruption of seasonal streams and rivers, which represent micro-habitats for certain species of plants and animals, can be avoided or mitigated through the selective siting of project infrastructure and the protection of stream flow from construction activities. Only one plant species of conservation concern was found on the larger solar complex site, Aloe dichotoma (quiver tree), though none have been recorded within the XiNa footprint. It was also confirmed that Sociable Weaver birds exist in the vicinity of the proposed site. The Environmental Authorisation permit requires that a procedure for removal of nests be written into the Operation Manual for the facility. In addition, a permit must be obtained from the Northern Cape Provincial Department prior to relocation of Sociable Weavers and White Browed Sparrow Weavers’ nests. These impacts will be managed through an updated EMP for the Project.

South Africa requires comprehensive disclosure of project information to stakeholders through the entire EIA and project permitting process including: public notification of the project; a public review of a draft project scoping report; a sequence of public meetings and public review of a draft EIA report; and formal public notification of DEA’s decision to award a permit for the project. In this process, EIA consultants identify, and organize public meetings and focus group discussions with, a full range of Interested and Affected Parties (I&APs). The outcomes of these consultations are incorporated into the final EIA and recommendations for the respective project’s environmental and social management plan. Any stakeholder who registers as an I&AP is required to be updated on project and permitting developments throughout the life of the project.
Stakeholder and public consultations were undertaken during the scoping stage in accordance with
National requirements and the outcomes have been incorporated into the final scoping and EIA reports and the DEA has considered that consultations with Interested and Affected Parties (I&APs) has been appropriate to the location and type of facility. The Sponsor has also confirmed that all registered I&Aps have been informed of the DEA’s decision to approve the revised technology and grant the XiNa Project environmental authorization (EA) within the 12 day stipulated period.
A complete record of notifications, public comments and the list of I&APs was attached as annexes to the EIA report disclosed along with this ESRS. Project information was placed in the public domain (local public libraries and on line (at http://www.savannahsa.com) during this period.
The sponsors, in collaboration with the local communities, have established Community Development Trusts, which will be equity shareholders in the Companies. Earnings from their equity stakes will provide revenue to each Trust to support community development activities.

For more information on the project outlined above, contact:Dr Louis van HeerdenGeneral ManagerAbengoa Solar South Africa (Pty) LtdKendon House3 Kiepersol Close, Cape Town, 7550Telephone: +27219309599 Email: mailto:mailto:Louis.VanHeerden@solar.abengoa.comWebsite: http://www.abengoa.com

Broad Community Support is not applicable for this project

S.no	Description	Anticipated Completion Date	Status
1	EPC Contractor to implement a site-specific Occupational Health and Safety Management Plan for the Xina Project to meet IFC’s Performance Standards.	07/31/2014	Completed
2	Prepare and submit a labour accommodation plan for any planned labour camp(s) in accordance with Performance Standard 2 and the IFC/EBRD Guidance on Worker’s Accommodation: Process and Standards (August 2009)	07/31/2014	Completed
3	Prepare and implement a protocol governing the project site security operations during construction and operations consistent with the requirements of IFC’s Performance Standards.	07/31/2014	Completed
4	Prepare and implement an Emergency Preparedness and Response Plan for construction and operation phases consistent with the requirements of IFC's Performance Standards.	06/30/2014	Completed