The proposed equity investment is a Category A project due to the diversity of E&S risks and impacts associated with planning, development and operations of large wind and solar projects mainly on account of land, biodiversity, noise and community related issues. While some of the individual projects that the company has or will develop/acquire may have limited risks and impacts, at this stage the residual risks and impacts associated with future pipeline (unknown/identified at this stage) of projects are not clearly known. HFE’s portfolio of existing/operating projects has residual issues as identified in the independent third party E&S due diligence that would need to be addressed in line with the agreed Environment and Social Action Plan (ESAP). These and other impacts on account of future planned projects will need to be carefully managed in accordance with Performance Standard’s requirements.

Update related to additional investment under the COVID-19 response facility:

E&S Performance: The Company has materially implemented the E&S Action Plan for the existing investment and has been regularly reporting to IFC through annual monitoring reports and regular updates. One of the pending actions from the previous E&S Action Plan was related to relocation of some households due to safety reasons and implementation of noise and shadow flicker mitigation at one of Company’s wind project. The Company has committed to complete this implementation by August 2020. Based on IFC’s supervision visits and review of information shared by the Company, the E&S performance has been satisfactory till date.

For review of the New Project, IFC relied on observations during the supervision visits (in December 2019) and updates from the Company on COVID-19 impacts and measures. As there is no change in the footprint, no separate visits were required. 

New E&S Risks: As all assets of the Company are already covered and supervised as part of the existing investment, the use of proceeds of the COVID-19 response facility is only for refinancing and no new project is expected to be constructed with proceeds of this loan, there will no new additional E&S risks due to this New Project. The agreement of the new investment will include similar requirement as previous agreement on compliance with IFC Performance Standards.

Response to COVID-19 Pandemic: As generation of power is classified under essential services under the Government of India directives, Company’s plants have been in operation throughout with enforcement of protective safeguards for COVID-19. Only construction activity for new projects was suspended. No retrenchment of workers has been undertaken by the Company (for both permanent and contract workforce). The Company has been ensuring regular supplies of essentials in its labor camp and guest houses. There has been no health impact due to COVID-19 on the workforce. The Company has developed procedures on safety and health of the workforce, which is strictly implemented and includes use of personal protective equipment, temperature checks, social distancing (e.g. in meetings, buses provided for employee transport), disinfection facilities, regular disinfection.