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
If IFC’s investment proceeds, IFC will periodically review the the project’s ongoing compliance with the Performance Standards

The proposed investment is a Category B project because the Environmental and Social (E&S) impacts that may result from constructing and operating a solar power generation and transmission facilities are limited and can be avoided or mitigated by adhering to generally recognized good practices and design criteria.

The EIA for the Project reports that environmental and social impacts and risks are low to moderate. Neither new access roads nor right-of-ways for transmission lines will be built. The Company has acquired 100% private land under a willing-buyer willing seller basis. The site is located within modified habitat, mostly composed of pasture lands and annual crops, and patches of dry forest and secondary vegetation, therefore PS6 on Biodiversity Conservation and Sustainable Management of Living Natural Resource is not applicable. No indigenous Peoples or territories are within the direct or indirect area of influence of the project, therefore PS7 on Indigenous Peoples is not applicable. The assessments to date have determined that the Project area does not have any cultural or historical significance, nor is it located in a suspected archeological area, therefore PS8 is not applicable. The Sponsors will, however, develop a chance finds procedure

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.

Environmental and Social Assessment: The Sponsors engaged a group of qualified E&S consultants to prepare the EIA for the project and got issued its environmental license (021-2014) by the Secretaria de Recursos Naturales y Ambiente (SERNA), now Secretaria de Energia, Recursos Naturales, Ambiente y Minas (SERNAM), on January 28th, 2014. The EIA process followed established terms of reference (ToR) to comply with SERNA requirements and concluded that potential E&S risks and impacts of the project were low to moderate in nature and for the most part temporary. Based on the review of the EIA and IFC’s site visit, during construction, potential impacts identified included: (a) land use change and changes in the landscape; (b) topsoil removal; (c) limited vegetation clearance of patches of low dry forest as a result of site preparation; (d) air pollution and reduction in air quality, and increased ambient noise as a result of construction traffic and the exhaust emissions from construction traffic and heavy equipment; (e) potential contamination of surface waters from construction and accidental oil/fuel spills; (f) generation of solid and hazardous construction waste; (g) influx of construction workers; (h) potential community health and risks related to construction traffic and panel transportation in public highways; (i) pressure over water resources and availability to nearby communities; (i) occupational health and safety risks to construction workers, and (j) potential economic displacement due to loss of access to Jícaro trees. During the operations phase, the main potential impacts identified are related to (k) pressure over water resources needed to maintain and clean solar panel modules; (l) permanent landscape modifications; and (m) community risks associated with the permanent presence of security forces. All these impacts can be mitigated with established pollution prevention and control technologies and by applying good international industry E&S management practices (GIIP), such as those required under IFC Performance Standards and those described in applicable World Bank Group EHS Guidelines.



Even though the EIA was relatively comprehensive, during appraisal, IFC identified a few gaps that will be addressed as per the agreed Environmental and Social Action Plan (ESAP). These include, among others: (i) the need to enhance the Company’s ESHS Management System (ESHS MS) for alignment with GIIP and local (Honduran) requirements; (ii) the need for an assessment of potential project impacts on water resources and users (i.e., water needed for panel cleaning vis-à-vis existing and future competing water users); (iii) additional baseline work and social assessments to manage any impacts from the loss of Jícaro trees on the local communities, and (iv) a robust stakeholder engagement process and management.



During appraisal, IFC also identified that although the project is around 40 km from the coast, it falls into a proposed marine pr
otected area named Rio Negro Biological Reserve which was sponsored by Centro Agronómico Tropical de Investigación y Enseñanza (CATIE) and the International Union for Conservation of Nature (IUCN) in 1987. The Sponsors have agreed to coordinate with other project sponsors (CATIE, IUCN, IFC and the government) to better understand the conservation objectives of the proposed protected area, and evaluate whether any additional conservation-related actions need to be included in the project’s Environmental Management Plan (EMP).



Environmental and Social Management System: CAS has a corporate Quality, Safety and Environment (QSE) Policy which includes several components of the ISO14001 and OSHAS 18001 systems, and which governs its operations and ensures adequate management of environmental and health and safety risks. As part of IFC’s involvement, the Sponsors have committed to adapting CAS’ existing corporate QSE Policy to be specific to its Project in Honduras and to develop the relevant programs and procedures to properly assess and manage environmental, social, and OHS risks of its activities in line with Good International Industry Practice (GIIP) (See ESAP Action # 3).



Management Programs: As part of its Management Program, CAS has developed several measures for addressing EHS risks and impacts including general measures related to those for water, soil, flora and fauna, air quality, waste management, noise, and environmental monitoring and performance. As part of ESAP Action # 3, CAS will enhance its MS to include additional and more detailed management plans and procedures to address existing and future ESHS risks and impacts. Some of the programs expected to be developed include those related to contractor management, emergency response, waste management, water management, pollution prevention, among others.



Monitoring and Review: Parameters to monitor ESHS performance have not been yet defined by the Company. As part of IFC’s involvement, CAS will complement its ESHS-MS with an ESHS Monitoring Plan to establish specific monitoring actions and frequencies including relevant indicators to assess ESHS performance for the project over time. The ESHS officer on site will assure compliance with the local legislation and GIIP, and keep record of all relevant air emissions, noise, discharges, OHS statistics, solid and hazardous waste generated at site, as well as water usage.



Organizational Capacity: The Sponsors have agreed to appoint qualified on-site personnel to handle the ESHS aspects of the Company’s activities and who will be responsible for the implementation of the ESHS-MS during project construction and operations. The Sponsors have agreed to hire an on-site EHS Officer as well as a Community Liaison Officer (CLO) to assure adequate implementation of the ESHS Management System, Stakeholder Engagement Plan (SEP) and Grievance Mechanism (See ESAP Action # 4 and 5).



In addition, construction contractors will be required to ha
ve on-site Environmental, Health and Safety (EHS) supervisors for their operations.



Training: The Sponsors will develop a comprehensive ESHS Training Plan to conduct periodic ESHS training for all of the Company’s employees and contractors on aspects such as safety audits, job related risks, hazardous materials, fire prevention, and proper use and disposal of residues and waste products. Through the implementation of this Training Plan, the Sponsors will ensure that the construction contractor and project personnel for the Project are adequately trained to undertake ESHS activities.



Reporting: The Company will submit annual environmental and social performance reports to the Municipal Environmental Unit (Unidad Municipal Ambiental, UMA), SERNA, lenders, and investors. The Company will also prepare and submit an Annual Monitoring Report (AMR) to IFC, to capture its environmental and social performance.

It is expected that the proposed project will generate about 500 jobs during the construction peak. Half of the non-skilled workers are anticipated to be locally hired from the surrounding villages. The Project will generate approximately on average workforce of 15 jobs during the operation phase. It is anticipated that the workers will live in the community closest the project site. No construction camps will be built. The Company will make an effort to hire as many workers from the local communities as possible.



Human Resource Policy and Management: CAS currently has a Human Resources (HR) Policy. The Sponsors, however, have committed to enhance CAS’ existing Policy and related procedures to align them with IFC’s PS2 requirements (See ESAP Action # 6). The HR Policy, procedures, and component of the ESHS-MS, specifically, will include provisions related to non-discrimination and equal opportunity, wages and benefits, no engagement in forced or child labor, and adequate working and living conditions. These procedures will be appropriately communicated to all employees.



The Sponsors will also prepare a worker’s grievance mechanism aligned with PS2 to define the channels available to submit grievances (i.e. mail, phone, verbal report to immediate supervisor/reporting authority; etc.) and will maintain a database with information regarding grievances outcomes.



Occupational Health and Safety (OHS): The Sponsors will establish an Occupational, Health and Safety (OHS) management system to address related risks and impacts (See Action # 3 of the ESAP), the OHS-MS shall include safety measures for worker safety and use of personal protection equipment (PPE), preventive equipment maintenance, daily safety chats and permanent training. The Sponsors will also focus on the prevention of risks related to work at heights, work with live power lines and equipment, fire hazards, exposure to chemicals, and exposure to electromagnetic fields.

This is a renewable energy project and it responds to a need to increase and diversify the energy capacity and matrix in Honduras to new, clean and renewable sources of energy, reducing a dependence on fossil fuels. The project is expected to reduce the generation of CO2 emissions from energy generation and electricity use in Honduras by 90,500 tons CO2-eq per year.



Hazardous and Non-Hazardous Waste: Non-hazardous waste generated during construction and operation will be disposed according to the requirements placed by the municipality. CAS has also developed a procedure to properly manage hazardous and non-hazardous wastes.



Water and wastewater: The water requirements for construction will be supplied by water wells. The water for human consumption for both construction and operation phases will be supplied by bottled water. During construction, the Sponsors estimate a use of 17,000 liters. During operation, to maintain and clean the solar panels, the Sponsors estimate a water usage of 330,000 liters/year (1 cleaning per year). As per Action #1 of the ESAP, the Sponsors will assess the environmental and social impacts of water use or withdrawal during construction and operation. As part of this assessment, a water management plan shall be developed including a water balance, justification for the extent of water usage on the site considering environmental, social and financial factors and specific mitigation measures to address any identified impacts.



The construction phase will generate only domestic sewage. The operation phase will generate sewage and discarded panel wash water. The domestic waste water will be collected and treated in septic tanks. The sludge produced will be removed by an authorized sponsor. Typically, minimal amounts of wastewater result from the panel cleaning activities, and wastewater falls to the ground beneath the photovoltaic modules and does not need to be treated, since it just contains dust and particulate material that deposits on the panels.



Air quality: The main source of air emissions (SO2, NOX and particulate matter) during the construction phase relates to the movement of equipment and vehicles. Prevention measures during this phase will include sprinkling of water on roads and periodic checks for proper vehicle and equipment maintenance. The impact on the air quality during the operation phase is very limited since the operation does not generate air emissions.

Community Health and Safety: The Project is expected to have low negative impacts to the nearby communities. Any potential induced influx to nearby areas resulting from the construction phase will be due to the expectation of new employment opportunities. However, it is anticipated this impact will be temporary given the short duration of the construction phase which will take approximately 9 months. The construction contractor will provide transportation to its personnel. Traffic volumes due to workers commute and transport of equipment and materials to the construction site are not expected to be considerable; however, there is a risk of traffic-related accidents. The Sponsors, along with the contractor, will establish the optimum transportation routes, traffic management measures, and the appropriate site access provisions that will reduce impacts through development of a Transportation Management Plan as part of the enhancement of the ESHS MS (ESAP Action # 3).



The Sponsors will also develop an emergency response plan and will develop dedicated emergency response training programs for all new employees as well as in-house and off-site training for first responders (ESAP Action # 8).



Security: The Company will have a private security contractor. Armed personnel may be considered subject to a risk analysis. Given the inherent security risks prevailing in Honduras, in alignment with this Performance Standard, the Company and Sponsors will commission a security risk assessment from a qualified security risk firm. This assessment shall result in a comprehensive security management plan that will be (a) commensurate to the security risks, (b) aligned with the Voluntary Principles on Security and Human Rights and (c) assure that security personnel are trained and operate consistently with such principles and Performance Standard 4 (paragraphs 12, 13 & 14) (See ESAP Action # 7). The plan will include a grievance redress process associated with the conduct of security personnel.

The Sponsors have undertaken a consultation process with the communities surrounding the project and included participants from the following villages: Caserío Los Humos de Suyapa, Colonia Victor Argeñal, Barrio San Jorge, Caserío La Chaperna, Caserío El Buen Samaritano, Aldea El Carrizo, Caserío La Fortunita and Caserío Montecillo. Most of the issues discussed were related to employment and expectations due to the presence of the Project, and requests of support for local community projects. In compliance with Honduran requirements, the developers conducted a public consultation/socialization process (Proceso de Socialización a Cabildo Abierto) with relevant stakeholders between December 2013 and September 2014. The Sponsors, will, in addition, develop and implement a Stakeholder Engagement Plan (SEP) in alignment with GIIP, and IFC Performance Standard 1 requirements (See ESAP Action # 4). The SEP will include (a) a stakeholder identification and analysis process; (b) the establishment of an effective and transparent ongoing stakeholder consultation/engagement process; and (c) an external grievance mechanism. The engagement process shall assure that all those potentially affected by the project and other stakeholders understand the project design as well as its potential environmental and social impacts and risks, and will address and effectively respond to their concerns. The Sponsors will design a Grievance Procedure to receive, register, respond to and monitor community grievances during construction and operation. This procedure will be designed to be easily accessible, efficient, and to respond to the grievances in a culturally appropriate way. The complaints will be handled by a local community liaison officer to be appointed for the project.

Aura Solar will make a copy of the ESRS and the ESAP available in the following locations in Mexico City (Mexico) and San Pedro Sula (Honduras) and near the project site for a period of 30 days starting on:

Gauss Energía
Mexico City, Mexico
Bosque de Ciruelos 278-2, Bosques de las Lomas, 11700, Mexico
Telephone: +52 (55) 5596 6070
Fax: +52 (55) 5245 1105

Energía Cinco Estrellas, S.A. de C.V.
San Pedro Sula, Honduras
Entrada Colonia Universidad, contiguo a Indefusa Do it Center, Carretera a Puerto Cortés, frente a Molino Harinero Sula
Telephone: (504) 2566-1414
Fax: NA




For further information, questions or comments please contact:

Héctor Olea
President and CEO
Gauss Energía
Bosque de Ciruelos 278-2, Bosques de las Lomas, 11700, Mexico
Telephone: +52 (55) 5596 6070
Fax: +52 (55) 5245 1105
E-mail: mailto:holea@gauss.com.mx
Website: http://www.gauss.com.mx

Broad Community Support is not applicable for this project

Aura Solar II(35364) Supervision Disclosure Snapshot – Version 3
Description	Anticipated Completion Date	Status	Comments	Completion Date
The Sponsors shall assess the environmental and social impacts of water use/withdrawal during construction and operations on nearby users. As part of this assessment, a water management plan shall be developed including a water balance, justification for the extent of water usage on the site considering environmental, social and financial factors and specific mitigation measures to address any identified impacts. The Sponsors will also use best efforts to coordinate a wider sustainable water use program with relevant nearby users.	01-May-2015	Completed	Completed	10/27/2017
The Sponsors shall carry out a social baseline of the communities surrounding the project site, assess any potential impacts from the loss of access and income to Jícaro trees and, if needed, develop the necessary management and mitigation measures to address these impacts.	30-Apr-2015	Completed	Completed	5/30/2017
The Sponsors will update and enhance its corporate Environmental, Social and Occupational Health and Safety Management System (ESHS-MS) for the construction and operation phase to make it applicable and specific to its project in Honduras. This shall include the development of the necessary specific ESHS management plans and procedures to address current and future risks.	01-Mar-2015	Completed	Completed	3/1/2015
The Sponsors will develop a Stakeholder Engagement Plan (SEP) aligned with GIIP which shall include a community grievance mechanism.	01-Mar-2015	Completed	Completed	5/27/2016
The Sponsors shall enhance its team and hire an on-site Community Liaison Officer CLO) and an EHS Officer. The Community Liaison Officer will be responsible for managing social risks and impacts, including the implementation of the Stakeholder Engagement Plan and Grievance Procedure.	31-Jan-2015	Completed	Completed	12/1/2015
The Sponsors will ensure that its Human Resources Policy and procedures are in line with IFC’s Performance Standard 2 and with Honduran labor laws; and will ensure that those implemented by the construction contractor are consistent with Sponsor s’ commitments. The Sponsors will develop and make available a grievance mechanism for workers, including contractors.	01-Mar-2015	Completed	Completed	8/1/2015
The Sponsors will commission a Security Risk Assessment for the project and will develop a Security Management Plan (SMP), including a training module for management and security staff. This SMP shall be aligned with the Voluntary Principles on Security and Human Rights and with the requirements of Performance Standard 4 (paragraphs 12, 13 & 14).	01-May-2015	Completed	Completed	2/27/2016
The Sponsors will complement its current ERP to include dedicated emergency response training programs for all new employees as well as in-house and off-site training for first responders. The plan will also include the communication to and training of the communities related to response to emergencies as appropriate. In addition, the Sponsors, along with the contractor, will establish: the optimum transportation routes, the traffic management measures, and the appropriate site access provisions that will reduce impacts to the community, as part of the enhancement of its EHS-MS.	01-Feb-2015	Completed	Completed	3/30/2015