FRV Potrero’s Environmental and Social Management System (ESMS) is comprised of relevant corporate policies, management programs and organizational capacity. These corporate-level ESMS elements (for example: sustainability commitments, code of conduct, governance practices, among others) provide FRV Potrero with the resources and guidance necessary to design and implement the project-level E&S impact and risk mitigation and benefit enhancement measures required to comply with Mexican regulations. In addition, FRV Potrero expects to contract the firm PRODIEL - an experienced international technology company specializing in renewable energy and environmental management - to act as Engineering, Procurement and Construction (EPC) contractor. As described above, PRODIEL will manage construction activities and associated environmental and social (E&S) impacts, while their joint venture partner, Power China will provide financial and procurement support in compliance with contractual obligations. PRODIEL is certified ISO 9001 / 14001, and OHSAS 18001, and has a well-developed Environmental and Social Management System (ESMS). FRV Potrero will update and consolidate their ESMS to support their commitments to manage the Potrero project’s impacts on the environment, their workers, and other external stakeholders (ESAP A1). The remaining paragraphs in this section summarize the key measures FRV Potrero has adopted to avoid, minimize, or mitigate the main project associated E&S assessment and management impacts and risks.
Policy: The Sponsor has a Code of Conduct that informs all parties with working relationships to the company of their ethical obligations and responsibilities towards FRV Mexico and its investors, clients, and other stakeholders. This Code of Conduct establishes basic guidelines and directives for the behavior of all FRV Mexico staff and associates. FRV Mexico’s Code of Conduct is broadly consistent with IFC performance standards and good international industry practice. This Code includes relevant sections on human resources, security, confidentiality, and environment, health and safety (EHS), among others. Staff and contractors receive a copy of the Code of Conduct during mandatory orientations. FRV Potrero will develop complementary policy implementation actions for the Potrero project as part of their consolidated ESMS (ESAP A1).
Identification of Risks and Impacts: FRV Potrero has relevant experience to identify key E&S impacts and risks, and to design mitigation measures aligned with IFC Performance Standards. IFC and the FRV Potrero have agreed on the associated Environmental and Social Action Plan (ESAP) to bridge any minor policy and performance gaps. In compliance with Mexican legislation, the sponsor contracted separate environmental (MIA) and social (EViS) impact assessments. These assessments adequately identified most of the key E&S impacts and risks, and related mitigation and benefit enhancement measures discussed in the E&S Categorization and Rationale section above. ESAP A1 will specify the process FRV Potrero will use to identify E&S impacts and risks during construction and operation of the Potrero Solar PV project.
Management Programs: The environmental, social and land-use permits FRV Potrero obtain from Mexican officials require the sponsor to implement a range of management programs for conservation of flora and fauna, occupational safety, waste management, emergency preparedness, among others. For example, the Sponsor’s environmental license requires that flora and fauna rescue and relocation efforts be made prior to and during construction. FRV Potrero suggested in the Environmental Impact report that an area of 78 ha will be reforested to compensate for impacts on vegetation. If implemented in accordance with the International Union for Conservation of Nature (IUCN) guidelines for translocation, these actions could generate a net benefit for conservation. Contractors and sub-contractors will also participate in these programs through contractual agreements. FRV Potrero will manage these E&S requirements through a Contractor Management Program that describes mitigation and performance improvement measures and actions that address the risks and impacts related to contractor performed activities (ESAP A2).
Organizational Capacity and Competency: FRV Potrero staff from their business development and finance divisions have been primarily responsible for project planning, permitting, and funding to date. These teams include qualified staff with many relevant E&S competencies. FRV Potrero also intends to outsource much of the responsibility for implementing the above-mentioned management programs to the EPC contractor. . The EPC contractor’s proposed E&S staffing includes a corporate level Health, Safety and Environment (HSE) Manager, Environmental Permits Manager, and a Monitoring Analyst. They also have an assigned Corporate Social Responsibility (CSR) Officer. On-site, they propose to employ a HSE Coordinator and one HSE Supervisor for every 50 workers, an Environmental Engineer, two Environmental Supervisors, and a CSR Coordinator. These teams report to the Project Manager and Site Manager who share overall leadership and responsibility for managing E&S risks and impacts. Workers also have a key role to play in the protection of their safety and that of the environment. The EPC provides all workers with sufficient training and decision-making power to report dangerous conditions or behaviors inconsistent with the company Code of Conduct. As part of ESAP action no.1, FRV Potrero will identify the positions and competencies required to supervise the EPC team’s E&S performance.
Emergency Preparedness and Response: All employees, including those working for contractors, must participate in mandatory training about applicable health and safety policies, emergency procedures, and medical services that accurately reflect the facility and surroundings. The EPC contractor will develop an Emergency Preparedness and Response plan based on the following elements: planning, operation and control; administration of resources, personal protection measures, and evacuation procedures. HSE Supervisors will know contacts (telephone numbers, radio frequencies) in case a specialized service is required, for example: rescue service, fire brigade, environmental emergency, or others. The EPC will also operate an onsite medical clinic and ambulance service. As part of ESAP action no.1, FRV Potrero will ensure this plan is updated and consulted with local authorities and communities, and that sufficient resources are available for staff training and implementation.
Monitoring and Review: According to national environmental licensing requirements, FRV Potrero must report to the licensing authorities on the status of their compliance with these legal requirements within six months of having received their authorization, or prior to construction, whichever comes first. Once this submission is approved, the sponsor must continue to submit annual E&S monitoring reports with evidence of implementation of required management programs. FRV Potrero’s environmental license also requires that they hire an Independent E&S Supervisor to monitor and review the FRV Potrero and EPC compliance with legal obligations, and report to the licensing authorities. Lenders E&S consultants will also monitor sponsor and EPC compliance with national legal and IFC E&S performance standards through biannual site visits during construction, and annually during operation.
