Environmental and Social Management System
The importance of E&S sustainability is recognized amongst Gaia’s senior management. Gaia has prepared an initial Environmental, Health and Safety (EHS) Policy that is specific to their operations. The policy emphasizes stakeholder engagement, adhering to legislative and regulatory frameworks in the countries in which the company will operate and the importance of contractor management. The company has established an initial ESMS framework that makes reference to the performance requirements of a number of international finance institutions, including IFC. The framework also outlines the types of E&S related activities that should take place at different stages of the project cycle. It is accompanied by a risk assessment procedure, which recognizes E&S amongst other financial and technical risks. The risk assessment procedure calculates a cumulative risk score considering multiple factors (see description of the Risk Management Plan in the sub-section below on ‘Management Program’). The company considers E&S risk factors on par with financial and technical risks as demonstrated in the risk register of a recently considered PV solar project, which shows E&S factors as one of the top risks considered by the company during the due diligence process. Also as part of the ESMS, the company will categorize their projects in accordance with IFC’s practice (Category A, B and C).
As stated in ESAP Action Item (#) 1, the company will build upon its existing ESMS framework to bring it into alignment with IFC’s PS 1 and to ensure that all projects in Gaia’s pipeline are screened with respect to relevant IFC Performance Standards and World Bank Group Environmental Health & Safety Guidelines. Also as part of this action item, the company will develop its EHS policy in a format that could be easily distributed to contractors and sub-contractors. The company will also include the E&S categorization of projects mentioned above as part of the development of a corporate ESMS.
The corporate ESMS will be designed to respond to Gaia’s business model, which is largely based on project acquisitions, but also envisions project development. For example, for project acquisitions, the ESMS will systematically evaluate if existing E&S assessments - such as E&S impact assessments (ESIAs) and management plans - are prepared according to national regulations and meet the requirements of IFC’s Performance Standards. If the acquisition is in mid-construction, Gaia will commission a third party audit to identify gaps with respect to the Performance Standards and include in an action plan. For greenfield project development, the ESMS will be designed to ‘guide’ the development of the project-level ESIA and management plans at the initial stages. Lastly, as Gaia is considering expanding in a number of different emerging markets, the ESMS may include high-level screening of country-level ‘contextual’ E&S risks t
hat would help inform the expansion of the project pipeline and flag potential issues early on. Globally accessible tools that map various E&S risks could be useful to the project in this regard (e.g., BirdLife International’s online Soaring Bird Sensitivity Map, which was developed for the Red Sea/Rift Valley flyway).
As stated in ESAP Action #2, Gaia’s corporate ESMS will include provisions that each project within its portfolio develops its own project-specific ESMS and E&S policy.
Environmental and Social Assessment
As per ESAP Action #2, the corporate ESMS will include the provision to develop an ESIA in alignment with IFC’s Performance Standards for all projects that the company develops. Where the company acquires a project where the ESIA has already been conducted, a gap analysis will be conducted on the existing ESIA with respect to the Performance Standards. The ESIA will address project-level risks and impacts and, as appropriate, cumulative E&S impacts. With respect to the latter, cumulative impacts assessment often cannot be carried out by a single developer given the regional scale of impacts and access to data. In this situation, and if the potential for cumulative impacts arise, Gaia is committed to engaging with other developers to encourage data-sharing of relevant E&S information on baseline conditions and/or environmental monitoring results; and to explore the possibility of a cost-sharing mechanism to evaluate potential cumulative impacts. Where appropriate, Gaia is also committed to consulting with governments of the host countries in which it plans to operate on the subject of cumulative impacts and other regional-scale assessments and to encouraging their participation in the process. The ESMS will include references to cumulative impacts as part of the risk screening process. As specified in ESAP Action #3, a procedure will also be developed on the types of actions that would need to be carried out if a cumulative impacts assessment is contemplated (e.g., stakeholder engagement, involvement of government, outreach to neighboring companies, involvement of relevant industry associations and data-sharing).
With respect to the company’s acquired solar PV project, an ESIA was prepared to meet national and international standards and is in alignment with PS 1. The report describes the various phases of the project, provides baseline conditions, discusses the significance of potential E&S impacts and identifies mitigation and management measures in alignment with the mitigation hierarchy and includes stakeholder identification and consultation. The ESIA is based on a number of technical studies, baseline surveys (e.g., air / noise quality, biodiversity, cultural heritage, etc.), an evaluation of project alternatives and consultation with relevant stakeholders.
Management Program
The type and extent of the Environmental and Social Management Plan (ESMP) to be established for each project site will b
e determined through the project-level ESIA process and in accordance with Gaia’s corporate ESMS. Key subject areas will include waste management, sediment and erosion control, noise management, air quality control, occupational health and safety (OHS), biodiversity management, community health and safety and cultural heritage management. Depending on the nature and scale of the project, the project might need to develop dedicated, self-standing management or actions plans for specific high risks topics, such as a Biodiversity Management Plan, Cultural Heritage Management Plan, OHS Management Plan.
As mentioned above, each project within Gaia’s portfolio will be assigned an overall risk score, which factors various types of risks including those pertaining to financial, technical, country-level, E&S and other matters. A Risk Management Plan, which is multi-disciplinary in nature, establishes the framework by which the project team will identify risks and develop strategies to mitigate or avoid those risks. Through the development of the Risk Management Plan, a project-specific management team is assigned and risk monitoring takes place in accordance with the plan throughout the life of the project. The E&S aspects of the risk management process (and the development of the Risk Management Plan) will be integrated into the development of the corporate ESMS.
Organization
At the corporate level, Gaia has a number of preferred consultants that are available to conduct E&S related assessments at the project level. As indicated in ESAP Action #4, Gaia will procure a senior-level E&S Advisor to establish its corporate-level ESMS and related procedures. Once the ESMS has been established, and depending on the number of projects within the company’s pipeline / portfolio, Gaia may need to hire a full-time E&S Manager to ensure that project-level E&S commitments are rolled out consistency across project sites and in alignment with its ESMS and to report and track incidents, grievances and/or other E&S issues to senior management and to the Board of Directors.
As part of ESAP Action #4, Gaia’s corporate ESMS will include guidance on the types of E&S resources required at the project-level. At a minimum, all projects will require a Health, Safety and Environment (HSE) on-site focal point. Depending on the nature and the risks of the project, a community liaison officer might also be required and specialist / external resources if high risks issues emerge (such as physical resettlement and land replacement, biodiversity and cultural heritage).
Monitoring and reporting
As indicated in ESAP Action #5, monitoring and reporting will be included in the corporate ESMS. The ESMS will include standardized methods to track adherence to PS 1 at the project level (e.g. status of project-level ESMS, availability of an ESIA that meets international standards, availability of ESMP and adequacy of on-site E&S resources). Reporting will b
e designed to help ensure that the corporate-level ESMS is being rolled out at the project level in a consistent manner across Gaia’s portfolio.
The ESMS will also include streamlined reporting measures from the project level to Gaia corporate Senior Management on high-risk matters such as, summaries of labor and community grievances, H&S and security incidents and any necessary reporting of updates on particular E&S sensitivities such as physical resettlement and land replacement, biodiversity and cultural heritage.
As also included in ESAP Action #5, Gaia will incorporate the topic of E&S into its existing Audit and Compliance Committee as included in its Corporate Governance Handbook. The Audit and Compliance functions reports directly to Gaia’s Board of Directors.
Emergency Preparedness and Response
A project-level construction and operations phase emergency preparedness and response plan (or a set of procedures) will be required for all projects in Gaia’s portfolio as indicated by the corporate ESMS.
Depending on the nature and the scale of the project, emergency preparedness and response procedures (including fire risk assessment and control systems, fire alarm systems and drills, emergency preparedness planning) will be included as part of the project’s OHS Procedures/Management Plan for both the construction and operation phases. Emergency preparedness and response procedures will be designed to be specific to the project site (referencing muster point, nearby emergency facilities, responsible entities on-site or in the region, etc.) and will include an overview of risks and emergency scenarios, spill prevention and control measures, roles and responsibilities, notifications and communications (including alarms, warning systems and back-up systems), equipment and resources. The procedures will also include a specific training program for employees and contractors.
