Assessment of Risks and Impacts:

As per national and local environmental regulations, the company develops environmental impact assessment (EIA) reports prepared by a qualified technical institute for all ground PV power stations, for submission to the local environmental authorities for approval. The EIAs describe management programs and monitoring requirements and address key risks and impacts commensurate with the nature of business activity of the company.  EIAs are not required for rooftop solar projects.

Environmental and Social Management Systems and Policy:

The company has an E&S policy in place defining its overarching goals. On this basis, the company annually establishes environmental, health, and safety related objectives and key performance indicators (e.g. zero incidence of electrical related incidents), with corresponding standard operating procedures (SOP) and detailed work instructions, with roles and responsibilities defined, and employee and contractor training programs developed and implemented accordingly. SOPs shared by the company focus on occupational health and safety, minimization of electrical incidents during construction and operation, and emergency preparedness and response, given that these have been identified as key areas of potential operational risks given the nature of business activity of ground-mounted PV stations. The company’s E&S policy, EHS objectives, KPIs, SOPs, roles and responsibilities, and training programs, together constitute its E&S management system, which is adequate and commensurate with the nature and extent of E&S risks of the company’s operations.

Management Programs, Reporting, Monitoring, and Review:

Day to day operations are implemented based on SOPs, and performance is evaluated as per established indicators. SOPs are applied uniformly across various ground PV stations, while their actual content differ slightly according to local conditions.

The company implements a set of supplier and contractor evaluation and selection criteria, and incorporates environmental, health, safety (EHS) related clauses into contractor agreements (e.g. requirements on use of proper personal protective equipment by all workers), which based on IFC’s review is adequate and commensurate with E&S risks associated with the project’s contractor’s operations. Before any contractor can commence work at a site, the company’s EHS department audits the contractor’s equipment and personnel readiness in accordance with an established checklist, and the contractor is required to submit its proposed day-to-day EHS management measures for the company to review and approve. All contractor personnel are also required to participate in the company’s site EHS and OHS training program before work can commence. Thereafter, the company’s on-site EHS foreman and security guards conduct daily inspections, as per EHS/OHS site compliance checklists, to ensure that contractor operations comply with its requirements. Contractor EHS requirements are encapsulated in the company’s Contractor EHS Management Procedures.

Emergency Preparedness and Response (EPR):

Hazard risk analyses are conducted, the results of which, including risk mitigation measures, form the basis for developing EPR procedural documents which are applied to each rooftop and ground PV station. IFC’s review finds the company’s EPR procedures to be adequate and commensurate with the company’s construction and operational E&S risks. EPR procedures detail actions to be taken in case of emergencies related to fire, electrical incidents, and potential natural disasters. Fire drills are undertaken at each PV power facility semi-annually. EPR procedures define the roles and responsibilities of various appointed staff members in case of emergency incidents, and of various working groups (e.g. evacuation team; medical response team) set up to manage and coordinate emergency planning and response.

Organizational Capacity:

The company’s EHS department is responsible overall for managing and coordinating EHS related programs and reports to the General Manager of the company. Related to this, an EHS/OHS committee has been established and is headed by the Deputy General Manager of the company, to whom the head of the EHS department reports, and with a designated EHS coordinator from each key operational department of the company comprising the rest of the committee members. One regional EHS coordinator from each of the company’s five designated operational regions in China report to the head of the EHS department. Each regional EHS coordinator, as part of the regional team to which she/he belongs, covers all the various rooftop and ground PV stations within that region and is responsible for ensuring OHS and EHS compliance at those stations, including construction contractor oversight and monitoring. A staff incentive program linked to EHS and operational performance is in place. Each regional team also has team members responsible for day-to-day management of under-the-panel agricultural activities, including waste management and human resource (HR) management aspects, and there are relevant procedures in place (refer to PS2 and PS3 sections below for further details).

In relation to its agricultural operations, the company will refine its standard operating procedures (on impact assessment, occupational health and safety, hazard point analysis, waste management, and training programs), key performance indicators, and monitoring programs, and apply them to all ground solar stations with under-the-panel agricultural activities. As part of the refined SOPs, the scope of EIAs of all future ground PV solar stations will be required to include assessing impacts of agricultural operations leading to appropriate mitigation and monitoring programs. Refer to the ESAP # 1 and # 2 for details.

Human Resources Policies and Working Conditions:

The company has a workforce of over 410 employees in its solar power generation business who are all full-time direct hires and with a male to female ratio of about 10:1 which reflects available talents and interested applicants in this sector. Employment practices of the company are consistent with principles of non-discrimination and equal opportunity and these are written into the company’s human resource policy and employee manual. Salary and benefits levels are determined by referencing prevailing labor market rates at comparable industry levels, and terms of employment consistent with national labor laws including provisions on minimum wage, working and overtime hours, mandatory social security enrolment, etc, are written into all employment contracts and are also stated in the company’s human resource policy and employee manual. Based on IFC’s review, the HR policy and employee manual are consistent with PS2 requirements and their scope adequately covers the contractor workforce. Overtime work does not occur to any significant extent. Turnover from 2017-2018 were below 10%, mainly due to natural attrition or staff deciding to return to their home provinces. No major retrenchment is planned in the foreseeable future as the company is expanding operations.

The company provides living quarters and dormitories to 210 staff, or a rental subsidy to other staff who choose to rent their own places near work locations. Staff dormitories visited by IFC appeared clean and safe, with adequate provisions (e.g. washing facilities) in place and measures to ensure privacy, and the company has written procedures in place mandating acceptable living quarter conditions and provisions.

Grievance Mechanisms and Workers’ Organizations:

IFC’s review did not find any signs of the use of child or forced labor, and effective measures are in place to receive and address worker grievances. Key means of management-worker communications are drop boxes, social media internal chat groups, staff sending anonymous emails to management should they wish to, regular staff meetings, and day to day direct dialogue between workers and supervisors during staff meetings. Where an employee feels an issue remains unresolved, she/he can escalate this to the human resource department or to senior managers. The company states that there have been no labor litigations.

About 15% of staff are members of the labor union at the company with membership being voluntary, and the company does not restrict any staff members from joining or setting up a labor union, or from entering into collective bargaining agreements should they wish.

Occupational Health and Safety:

Hazard risk analyses are conducted at power station sites before any commencement of works to identify potential risk points and targeted mitigation measures. Based on company records, there have been no fatalities as part of its activities nor lost time OHS incidents at company facilities in the past two years, including work related traffic accidents. Overall, given the company’s business nature, OHS risks during construction and operation are relatively moderate. As described under PS1, OHS performance is monitored by designated EHS officers against site inspection checklists, and the company also proactively looks for signs of near-misses as a leading indicator and takes remedial actions before near-misses transpire into actual lost time incidents. In relation to agricultural operations, there have been no instances of lost time accidents or agricultural chemical-related poisoning or mis-use incidents. The company requires that all workers in its farming operations wear adequate personal protective equipment (e.g. gloves, masks), and follow strict procedures on the access, use, storage, and disposal of chemicals. The company will further reinforce its OHS procedures, KPIs, and monitoring program applicable to agricultural operations – refer to ESAP # 1 for details.

Resource Efficiency and Greenhouse Gas Emissions:

Given the nature of business of the company’s rooftop and ground PV stations which involve limited use of grid electricity and fuel during construction and operation, estimated greenhouse gas emissions are regarded as negligible. The company states that total annual water consumption across its various power stations is estimated at a total of 22,000 cubic meters, mainly for the purpose of cleaning solar panel surfaces. This would represent on average an annual water consumption of about 370 cubic meters at each of the 51 stations, a small footprint which poses limited impact in terms of reducing water available to other local users such as farmers and small to medium rural township enterprises. The EIA of each project assesses its water use and water balance in the local area, and previous EIAs have not found the company’s projects to adversely affect water availability to other local users, and also have not found a scenario of the presence of other significant local water users competing for and reducing local water supply available to the company’s operations.

Pollution Prevention:

This renewable energy project is expected to annually displace about 260,000 tons CO2 equivalent of greenhouse gas which would have been produced from the burning of fossil fuels in a no-project scenario. The company’s rooftop and ground power-generation activities during construction and operation result in limited air emissions, waste water discharge, and solid waste generation. Hazardous wastes (solvents, oily rags, etc) are also limited in quantities and are collected, transported, and handled by licensed operators. Sanitary effluent from power stations is limited given that each station typically has not more than 3 persons at site during operations, and typically not exceeding 30 workers during construction, and is treated by on-site septic tanks. Construction waste is handled and disposed of by construction contractors as per pre-agreed waste management measures between contractors and the company, with the wastes recycled/reused where possible, and where not possible transported by licensed vehicles to designated local disposal sites. IFC’s review of available information confirms such construction waste management practices to be robust. Unused or damaged PV equipment or parts, if any, are collected by equipment suppliers.

In its agricultural operations, the company uses herbicides (e.g. Glyphosate), fertilizers (e.g. NPK mix), and fungicides, and states that no insecticide is in use. The following are key pollution-abatement measures taken: each site, based on an estimate of its required agricultural chemical usage quantity, submits an application to the procurement department, which centrally procures and distributes required chemicals to all project sites; the procurement department maintains a list of low-toxicity and low-residue fungicides and only procures from this list; agricultural chemicals are stored at areas within each farm only accessible to authorized personnel; empty agricultural chemical bags and other discarded items are collected by licensed recyclers; spraying of chemicals is not permitted near any water bodies, with a spraying distance of 2 meters from water bodies observed, and spraying is undertaken only on non-rainy days to avoid rainwater inadvertently carrying chemicals into local water bodies. In addition to refining its agricultural SOPs, KPIs, and monitoring programs, the company will also initiate a program of monitoring local ground water and soil quality, at representative agricultural sites, and provide summary results to IFC annually. Refer to the ESAP # 3 for details.

There have been no security nor safety incidents at any of the company’s power stations and under-the-panel agricultural sites. The company has effective procedures in place for managing traffic related risks to local communities and there have been no known cases of traffic safety incidents. There are no dedicated security personnel deployed at project sites since it is mostly large affixed equipment placed at sites which is difficult to remove. During operations, the company’s on-site, unarmed personnel patrol the sites. The company places a strong emphasis on proactively preventing fire risks associated with potential electrical malfunction incidents (e.g. short circuiting) at rooftop and ground solar stations, and has detailed policies, procedures, KPIs, training programs, and a team of qualified electricians across its regional teams to oversee this aspect. Hazard point analyzes conducted by the company include in-depth review of potential electrical risk points and required mitigations. Fire and emergency preparedness and response drills at the PV sites are conducted semi-annually.

Key stakeholder groups for the company are its employees, suppliers, contractors, clients, and rural community residents in the vicinity of each ground PV power station. To date, there have been no known grievances or issues of public concern associated with this project. During operations, the control room at each ground PV station and persons in charge at site are the key public interfaces to receive external communications including grievances from the public if any; and members of the public can also reach the company through its main telephone switchboard, social media account, and contact email address. The company proactively engages with local community stakeholders through: its long-term leasing of land from rural residents and village collectives to set up its ground power stations, thereby generating lease income for them; its under-the-panel agricultural activities, and the renting out of land to local farmers to grow cash crops under its PV solar panels, which contribute positively to local development. Overall, the company has elements of an effective grievance redress mechanism in place including steps to receive, respond to, resolve, and fully document each case, and its engagement with local communities is robust and befits the nature and extent of its E&S risks and impacts. The company will develop a stakeholder engagement plan (SEP) and grievance redress mechanisms (GRM) and incorporate these as standard operating procedures into their E&S management system.

Contact Person: Ms. HUANG Lan

Jiangsu Linyang Energy Co., Ltd.

Address: 18F, Building 1, Zhengda Wudaokou Plaza, Lane 1199 Minsheng Road, Pudong New Area, Shanghai, China

Tel: +86 21 50196211

Email: huanglan@linyang.com

http://www.linyang.com