IFC’s appraisal considered the environmental and social management planning process and documentation for the Project and gaps, if any, between these and IFC’s 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 implementation of these measures, the Project is expected to be designed and operated in accordance with Performance Standards objectives.
PS1: Assessment and Management of Environmental and Social Risks and Impact
Environmental and Social Management System and Policy. Darway Coast has established an E&S Management System (ESMS) framework and a corporate E&S Policy. The policy articulates sustainability objectives including promoting low-carbon renewable energy, conserving biodiversity, and resource efficiency in its operations. The Darway Coast’s ESMS has been developed in accordance with guidelines outlined in the WB approved DARES Platform E&S Management Framework (ESMF). This ESMF serves as an E&S assessment and management tool for DARES projects and provides guidance for satisfactory E&S performance management during project planning design, construction and operation phases in line with the applicable WB E&S Standards (ESS). Also, the ESMF is supported by separate instruments such as Resettlement Plan Framework (RPF), Labor Management Plan (LMP) and Stakeholder Engagement Plan (SEP) prepared for the DARES Projects, based on WB’s ESS. These documents serve as anchor E&S instruments for RESCOs selected to participate in the DARES program.
As part of the IFC investment, Darway Coast will consolidate its overall approach to E&S risk management and contractors oversight in a corporate ESMS with appropriate E&S procedures and plans, including on; (i) identification and assessment of E&S risks and impacts, and permitting; (ii) energy, water, waste and pollution management, (iii) management of E&S organizational capacity; (iv) E&S training; (v) emergency preparedness and response, including life and fire safety (L&FS) provisions, (vi) stakeholder engagement and community grievance management; (vii) contractor management (to be updated); (viii) traffic and security management ; (ix) supplier code of conduct and supply chain management; (x) occupational health and safety management; and (xi) E&S monitoring/reporting, including Key Performance Indicators (KPIs). The company will also update the Land Acquisition section of the ESMS as well as the Land Acquisition Management Plan to include the requirement on selection of only sites with no physical or economic activities that do not trigger involuntary displacement as defined in IFC PS 5, and requirements for monitoring land acquisition related social risks (ESAP #1).
Identification of Risks and Impacts. Darway Coast developed and submitted E&S Management Plans (ESMPs) in April 2025 for the mini grid sites in accordance with the requirements set by the Nigerian Federal Ministry of Environment, other statutory obligations, and the World Bank-approved DARES ESMF. These ESMPs adopts the mitigation hierarchy prioritizing avoidance and minimization of impacts and covers all phases of the projects. The DARES mini grid site ESMF exclusion list includes sites located in legally protected areas (e.g., national parks, conservation areas, forests), in internationally recognized areas, in critical natural habitats and where mini grid construction and operation will cause significant degradation of natural habitats (e.g., mangroves). Also, the ESMPs address a range of potential impacts, including land acquisition, construction-related disturbances such as air emissions, dust, and noise, soil erosion, biodiversity effects, community health and safety issues linked to transportation, and occupational risks. Each identified impact is paired with tailored mitigation measures and clearly assigned management responsibilities. Furthermore, social impacts have been integrated into the assessments, in alignment with IFC PS1 requirements. Darway Coast will secure all E&S permits from relevant authorities for all the mini-grid sites being financed.
Site selection and Land Acquisition: Darway Coast has developed a Land Acquisition Management Plan aligned with the DARES RPF and all the 21 sites have followed the willing buyer/willing seller principle with no economic and physical displacement. There will be no additional land acquisition for the distribution lines, which will be laid along existing road servitudes. Similarly, for all future sites to be considered for the mini-grid Project, Darway Coast will, as part of its ESMS upgrade, apply site selection criteria that avoid physical or economic displacement, as defined in IFC Performance Standard 5. Should a negotiated acquisition not be achieved, the client will consider alternative sites and not resort to any form of eminent domain. These commitments will be achieved by implementation of the updated Land Acquisition Management Plan and the Land Acquisition section of the ESMS in ESAP #1 above.
Management Programs: Darway Coast has established ESMPs that outline the management and mitigation requirements for its operations. The ESMP specifies roles, responsibilities, and regulatory compliance requirements. Additionally, Darway Coast has developed sub-plans and procedures within its ESMS to address identified E&S impacts associated with its mini-grid projects. These include the Waste Management Plan, Emergency Response Plan, Contractor E&S Management Requirements, Stakeholder Engagement Plan, Gender and Inclusion Plan, Occupational Health and Safety Plan, Community Health and Safety Plan, Site Organization Plan, Procurement Plan, Security Management Plan, Traffic Management Plan, Training and Capacity Building Plan, and Land Acquisition and Compensation Plan. Going forward, Darway Coast will (i) update its Contractor E&S Management Requirements document ensuring that E&S requirements are expressed in procurement standards, translated into tender documents and finally in contracts and (ii) develop a Site E&S Pre-clearance Procedure that includes site-specific templates for a) preconstruction E&S assessment, b) safety risk assessment c) security risk assessment d) site specific transport risk assessment, e) stakeholder engagement plan, and f) construction kick-off checklist (ESAP#2). This procedure will be used as a management tool signed off by a competent authority to ensure that all E&S processes are completed before commencement of work at each mini-grid project site.
Organizational Capacity and Competency. Darway Coast is developing its organizational capacity for E&S management, with a clear allocation of E&S responsibilities. There is a dedicated E&S Manager to lead ESMS implementation, supported by project teams and site managers. Senior management, including the CEO and Board, is accountable for E&S performance, demonstrating board-level commitment. The company has developed a capacity building plan and intends to conduct internal training on E&S issues for staff and contractors, covering topics like impact assessment, mitigation planning, and public consultation. As part of this IFC investment Darway Coast will recruit a dedicated suitably experienced EHS manager who will have the responsibility of overseeing the update and implementation of the ESMS and conducting monitoring of E&S performance and reporting to senior management. Also, the EHS Manager will oversee implementation of a competency training and awareness program to support awareness and capacity building in relation to the overall ESMS (ESAP #3).
Emergency Preparedness and Response. Darway Coast has developed an Emergency Response Plan (ERP) which covers various emergency scenarios relevant to a solar mini-grid project, such as fires, hazardous material spills, and severe weather events. It emphasizes flexible and adaptive responses, preparing staff to handle unforeseen situations effectively. The ERP outlines emergency roles and communication channels, emphasizing worker and visitor safety. It mandates regular drills and maintenance of emergency equipment like fire extinguishers and first aid kits. The plan includes coordination with local services, ensuring community awareness and response integration and covers site evacuation procedures, alarm systems, communication protocols, and assembly points to effectively manage emergencies. As per ESAP #1, the company will consolidate their emergency procedures into an Emergency Preparedness and Response Plan (EPRP), aligned with the requirements of IFC PS1, and will implement this EPRP at all its operating sites with site specific response procedures (evacuation plan) and drills.
Supply Chain: Darway Coast procures solar panels, batteries, and associated equipment from ‘Tier 1” (directly or through distributors) and plans to order all the equipment upfront. Darway Coast is considering procuring PV modules through the aggregator platform. Darway Coast has developed a Procurement Policy which provides a foundational framework and broadly aligns with principles from IFC PS1. The policy affirms a commitment to E&S integration across the supply chain and encourages ethical supplier practices. It embeds E&S, and economic considerations in supplier selection, procurement processes, and engagement with stakeholders and emphasizes fair labor practices and supply chain sustainability. As per ESAP #1, Darway Coast will strengthen its procurement policy to align with PS requirements to include: i) a supplier code of conduct prohibiting child and forced labor and containing other relevant E&S requirements, including a supplier registration and evaluation sheet that includes these labor and HSE provisions; ii) contractual clauses requiring suppliers’ compliance with the code of conduct; iii) a verification process to ensure new suppliers have the policies and procedures in place to meet requirements of the code of conduct; and iv) a formal process for supplier engagement, remedy or disengagement in case of unresolved non-compliances.
Monitoring and Review. Darway Coast's ESMS and project plans include comprehensive monitoring and review mechanisms aligned with IFC PS1 requirements. The ESMP provides a summary monitoring schedule for key issues, ensuring effective implementation of mitigation measures through proposed monthly inspection checklist to verify the presence and condition of spill containment kits, fire extinguishers, and first aid supplies amongst others. Going forward, Darway will implement an E&S monitoring and reporting procedure (ref. ESAP #1) with defined KPIs. The procedure will include key E&S indicators to be monitored, levels of E&S monitoring and a clear reporting structure from the lowest monitoring site to the Board of Directors. The E&S monitoring will also include issues related to land acquisition and use (per ESAP #1 above), both from internal monitoring and external stakeholders (including external grievances raised) and the Procedure will be implemented at all Project sites.
PS2: Labor and Working Conditions
Human Resources Policies. Darway Coast currently has approximately 44 full-time staff and 60 contract staff. The workforce has a male to female ratio of approximately 4:1. Darway Coast has developed several policies and procedures in relation to their human resource (HR) management, including HR management, workplace ethics, occupational health and safety, and grievance handling. The company has also developed an HR Manual detailing the company’s general employment principles and culture and articulates labor provisions including; (i) recruitment and onboarding; (ii) employee conduct and performance, (iii) workplace ethics and anti-discrimination, (iv) termination processes and disciplinary procedures; (v) Grievance redress mechanism (employee-focused) and (vi) Health and safety policies. As part of this IFC investment, Darway Coast will update its HR procedures manual to a PS2-compliant HR Manual for its employees and contractors as a management tool for its workforce and third-party workers with: (a) retrenchment procedure and (b) provisions on subcontracted and supply chain workers (ESAP #4)
Working Conditions and Terms of Employment. The Darway Coast HR policy has defined a standard eight working hours from Monday to Friday, and provides structured leave entitlements, including annual leave, sick leave, and maternity leave. Recruitment is merit-based, with outlined procedures for onboarding, training, and probation. Also, the policy includes health insurance, group life assurance, pension plans, and training support for staff. Furthermore, progressive disciplinary measures are included, outlining definitions of misconduct and OHS policy outlines internal risk management with pre-employment medicals, periodic health checks, first aid procedures, and emergency response. As per ESAP #4 Darway Coast will update its HR manual to include provisions on regular consultations with workers.
Workers’ Organizations. Darway Coast has developed a Right to Organise and Collective Bargaining Policy for the direct employees. The policy affirms the right of Darway Coast employees to freely form or join trade unions and engage in collective bargaining without fear of retaliation. It references the Nigerian Constitution and the Trade Unions Act, which establish these rights while noting exceptions (e.g., essential services like immigration or customs) and references ILO Convention. Currently, there is no active labor union at Darway Coast, and no workers association so there are no personnel representatives.
Equal Opportunity. Darway Coast’s Non-Discrimination and Anti-Harassment Policy ensures employment decisions are merit-based and condemns workplace harassment. The policy has specific provisions on; (i) zero tolerance for discrimination and harassment; (ii) recognizes various protected characteristics including race, gender, religion, (iii) Commitment to disciplinary action, (iv) promoting a safe and respectful workplace culture.
Grievance Mechanism. Darway Coast has developed an employee Grievance Redress Mechanism (GRM) approved in May 2023 with provisions for timely, fair, and confidential resolution of employee grievances, covering issues such as discrimination, harassment, safety, compensation, and policy violations. It outlines a step-by-step process, including informal resolution, formal submission, investigation, decision, and appeal, emphasizing confidentiality, non-retaliation, and HR oversight. As part of this ESAP #4 above, Darway Coast will update its grievance mechanism to (i) cover all workers, including third-party workers; (ii) include roles, responsibilities, action timelines and a system to log, track and report grievances; (iii) include provisions for submission of anonymous grievances and specific channels for Gender-Based Violence (GBV) and Sexual Exploitation, Abuse, and Sexual Harassment (SEAH) complaints. The company will also conduct employee awareness of the updated GRM through inductions, notice boards and online platforms, with specialized training requirements for staff handling GBV-SEAH complaints aligned with IFC PS2.
Protecting the Workforce. As per the company’s HR Policy, Darway Coast does not support or condone any form of child or forced labor. As per the HR manual, the company does not employ anyone under 18 years of age. Also, the company has included prohibition of child or force labor in its Procurement Policy to manage labor risks and impacts within its supply chain.
Occupational Health and Safety. Darway Coast’s Occupational Health and Safety Management Plan (OHSMP) addresses various occupational risks during mini-grid project phases, referencing both national standards and IFC PS2. The OHS plan has requirements and procedures for risk assessment, training, incident reporting, and emergency preparedness. Darway Coast has also adopted a Personal Protective Equipment (PPE) policy defining the company’s minimum PPE requirements. There is general awareness of the OHS management system as well as key OHS risks among the workers. Billboards with the minimum safety requirements is installed at operational assets project sites with adequate safety signs, firefighting equipment, toilets, and first aid arrangements. Darway Coast maintains an incident register and formal incident investigation procedure and has not reported any lost time injuries in 2024, resulting in a Lost Time Injury Frequency Rate (LTIFR) of 0. OHS leading and lagging indicators will form part of the KPIs monitored and reported regularly (ref. ESAP #1) as part of the ESMS implementation.
Workers Engaged by Third Parties. Darway Coast utilizes a limited number of third-party service providers. As per Darway Coast’s procurement policy, all service providers and other external parties are required to adhere to Darway Coast’s policies and procedures. The company has also implemented a Contractor Management procedure detailing the selection, evaluation, management, and monitoring of third-party service providers. The procedure includes involvement of the QHSE supervisor in evaluation and monitoring of contractor’s health, safety and environmental (HSE) practices and performance as per Darway Coast’s polices and valid work permits. As part of this IFC investment, Darway Coast will update its Contractor Management Plan (ref ESAP#2) to; a) include requirements for internal audits of labor conditions beyond health and safety compliance to areas including monitoring of periodic working hours, wages, or benefits per national labor law; and requirement for risk assessments of vulnerable groups including migrant workers and women; and a) ensure that the E&S requirements of the Contractor Management Plan translated into contract include requirement for labor rights clauses in all contracts (wages, hours, freedom of association) and periodic spot interviews with contractor workforce and c) require Contractors to implement a separate GRM and / or cascade Darway Coast’s GRM to contractor workers.
PS3: Resource Efficiency and Pollution Prevention
Solar mini-grid projects are not expected to materially consume key resources (e.g., energy, water) or result in significant emissions or pollution during operations. EHS risks are largely associated with the construction phase and are typically site-specific, short-term in nature, and managed through the implementation of the ESMPs.
Resource Efficiency and Greenhouse Gases. Darway Coast’s mini-grid installations are designed to be energy-efficient, primarily utilizing its own solar power during operations. During the construction phase, the energy mainly comes from diesel-powered equipment and generators. The project aims to minimize energy consumption by using diesel generators only when necessary. It also includes hybrid inverters and battery systems to store solar energy for use during non-sunlight hours, improving the overall energy efficiency of the mini-grid and reducing the reliance on back-up diesel generators. The Company take steps such as installing LED lighting, using energy-efficient appliances in offices, and using some of the solar energy to power site offices instead of drawing from the grid or generators.
Air Emissions: Darway Coast mini-grid project's air emissions are primarily from construction activities, which generate dust and particulate matter, and from diesel-powered machinery and backup generators emitting pollutants like NO?, SO2, CO, and PM. Greenhouse gas emissions (“GHG”) from the project during construction are predominantly associated with the transport of project components and on-site equipment and machinery including stand-by generators. During operations, annual GHG emissions from occasionally used back-up generators are expected to be below 25,000 tons of carbon dioxide equivalent per annum.
Water Consumption. Darway Coast sources its water from onsite boreholes. The company’s current water consumption is predominantly associated with dust suppression, concrete mixing, and domestic use by workers during construction. During the operational phase, water consumption is minimal, primarily for drinking, ablution, and periodic solar panel cleaning. As per ESAP #1, Darway Coast will include water management, monitoring and reporting as a KPI in its E&S monitoring procedure. This will include monthly water consumption, as well as the identification, where feasible, of viable water conservation measures within the company’s operations.
Waste Management. The project will generate typical non-hazardous waste streams like packaging materials, paper, plastics, organic waste from workers, and construction debris (e.g., wood, concrete, scrap metal). Also, Hazardous waste and materials handled at the solar mini-grid sites include batteries (e.g., lead-acid or lithium-ion), electronic parts (e-waste), battery chemicals, lubricants, cleaning agents and diesel fuel. Darway Coast has developed a Waste Management Plan (WMP) detailing the production, handling, storage, transport, and disposal of all waste streams generated from its operations. Darway Coast currently segregates waste by type and stores the waste in dedicated areas. Where feasible, Darway Coast prioritize the reuse of solid wastes such wood and cardboard while any waste metal is sold to scrap metal merchants. Darway Coast’s WMP envisages the use of authorized waste management service providers. As per ESAP #1, Darway Coast will track and report its waste from cradle to grave and conduct a due diligence on its waste service providers prior to contracting them to manage project waste.
Hazardous Materials Management. Darway Coast manages hazardous materials such as batteries, solar PV panels, electronic components, diesel, waste oils, and oil filters on site. Darway Coast has developed a Hazardous Material procedure identifying their primary hazardous materials, and the risks and impacts associated with their use. This includes the maintenance of a Hazardous Substance register and Materials Safety Data Sheets (MSDS). The procedure further defines the handling, storage, and disposal requirements. Additionally, the Company has signed a Memorandum of Understanding (MoU) with a licensed e-waste management company. Under the MoU, the licensed e-waste company will provide services for the removal, collection, transportation, treatment, recycling, and/or disposal of wastes from Darway Coast’s solar mini-grid sites, including: used or damaged batteries (Li-ion, lead-acid, Ni-Cd); faulty or outdated inverters and charge controllers; broken or end-of-life solar panels; electrical cables and connectors; packaging materials including plastics, cardboard, and wooden crates. As part of this IFC financing, Darway Coast will adopt a bar code or app-based inventory that tracks electrical/ battery serial numbers through end of life take back and implement a waste transfer and disposal process to ensure compliance with its ESMS, Waste Management Plan (ref. ESAP #1), national regulatory requirements and IFC PS3 requirements.
PS4: Community Health, Safety and Security
Community Health and Safety associated with Transport. Darway Coast’s logistics involve moving materials across states and into communities presenting E&S risks due to narrow roads and shared usage with pedestrians. The Company truck fleet consist of two trucks, but it relies on suppliers’ fleet to move components to mini-grid sites. Darway Coast’s ESMP outlines broad mitigation measures like speed limits and experienced drivers. The company has adopted a Driver Safety guideline describing driver behavior and best practices. As per ESAP #2 the Company will implement site specific transport risks assessment templates in its Site E&S Pre-Clearance Procedure and under the ESMS implementation (ref. ESAP#1) provide adequate training to its drivers and those of its suppliers on diverse E&S issues including GBV-SEAH.
Security Personnel. Darway Coast does not utilize a third-party service provider for security purposes, rather security guards are directly recruited by the company through the Community Power Committee. The guards recruited from the local community are unarmed and provided with training. As part of the ESMS update, Darway Coast will develop and implement a Security Management Plan (SMP) guided by the principles of proportionality and good international practice. The SMP will define the company’s approach to risk assessments, hiring, code of conduct, training, appropriate conduct toward workers and community members, equipping, and monitoring of security guards and their activities. Also Darway Coast will provide training (ref ESAP #1) to all security agents deployed at the different mini-grid sites including on Ethical Conduct and the Voluntary Principles on Security and Human Rights (VPSHR).
