Blue 1 Solar Project

MIGA has been requested to provide guarantees covering non-shareholder loans by the Green for Growth Fund Southeast Europe S.A., SICAV-SIF (Guarantee Holder or GGF) into SPV BLUE 1 SH.P.K (Project Enterprise, PE),  for a period of up to 13 years. The PE is a joint venture company created by Blessed Investment sh.p.k and Matrix Konstruction sh.p.k to undertake the design, construction, operation, and maintenance of a 50 megawatt (MW) solar photovoltaic plant (PV) and a 1.6 kilometer (km) 110 kV overhead transmission line (OHTL) in Topoje, Municipality of Fier, Albania (the Project).  

The Project consists of 103,020 solar panels, office buildings, a 110/35 kV substation, access roads, and a parking area. The Project’s 110 kV OHTL temporarily connects the power plant to the 220 kV Hoxhara-Fier OHTL until the project can connect to the new 220/110/35 kV Hoxhara substation, which is estimated to be commissioned in December 2024. The Hoxhara-Fier OHTL and Hoxhara substation, which are under the responsibility of the Transmission System Operator (OST sh.a.), have been designed to serve existing and planned solar power projects in the area.   

The Project is located in two separate land plots (main plot and secondary plot), approximately .05 km apart, on bare and former agricultural land, which has not been cultivated for over 30 years. The Project site, which is approximately 1.5 km from the coast of Topoje, does not overlap with any legally protected area, key biodiversity area, or important bird area. The area is sparsely populated and the nearest village, Gyrka, is located approximately 1.5 km from the Project site.  

The Engineering, Procurement and Construction (EPC) of the Project was implemented through split contracts (e.g. civil works, electrical, engineering), overseen by the PE. Matrix was responsible for construction of the Project, while Renco provides construction management and engineering assurance. The Project’s construction started in July 2022 and was commissioned in May 2024. Abkons sh.p.k, a subsidiary of Blessed Investment, has been contracted for the Project’s operation and maintenance. 

The project benefited from a technical assistance grant from MIGA’s Fund for Advancing Sustainability (FASTF). This grant enabled the project to engage a specialized firm to conduct a Critical Habitat Assessment (CHA) in alignment with IFC Performance Standard 6 (PS6). A comprehensive CHA is essential for identifying and mitigating potential impacts on endangered species or sensitive ecosystems within the project area.

MIGA’s due diligence review considered the environmental and social management planning process and documentation for the Project and identified gaps between these and MIGA’s requirements. Where necessary, corrective measures, intended to close these gaps within a reasonable time period, are summarized in the paragraphs that follow and in the Environmental and Social Action Plan (ESAP) attached to this ESRS.  Through the implementation of these measures, the Project is expected to be designed and operated in accordance with the Performance Standards. 

Key environmental and social (E&S) issues associated with the Project business activities are summarized in the paragraphs that follow. 

PS1:  Assessment and Management of Environmental and Social Risks and Impacts 

Environmental and Social Assessment and Management System: 

The Project has developed and is currently implementing a project-level E&S Management System (ESMS), which covers health, safety, environment, and social aspects of the Project. The key aspects of the ESMS are described in the Project’s E&S Management Plan (ESMP) and specific E&S plans and procedures, which were developed during the Environmental Impact Assessment (EIA) process, prior to construction. 

Policy: 

The Project has a Health, Safety, and Environment (HSE) Policy that stipulates the main E&S objective, principles for E&S assessment and management, compliance with applicable laws and regulations, and the management’s commitment to uphold the Project’s HSE performance. 

Identification of Risks and Impacts: 

The PE commissioned Abkons, a subsidiary of the PE, to develop the Project’s Preliminary Environmental Impact Assessment (EIA) Report that was completed in 2020. The Preliminary EIA describes potential E&S impacts of the different phases of the Project, proposed mitigation measures and monitoring plan. In addition to the Preliminary EIA, the Project has developed additional studies and assessments related to hydrology, biodiversity, local communities, and human rights to comply with the Performance Standards.  The results of these studies, together with the information regarding the OHTL, were incorporated in an addendum to the Preliminary EIA, which was developed in November 2022.  

The Preliminary EIA was submitted to the National Agency of Environment (NEA) and the NEA Decision on Preliminary EIA was obtained in February 2021. The NEA Decision for the EIA addendum, focusing on the OHTL, was obtained in October 2023.  

The PE conducted a preliminary climate risk study and a specific hydrological study to assess the risk from flood and erosion and identify necessary measures to ensure the protection of the project. Based on these studies, it was recommended that all electrical equipment should be installed on a height of a minimum 1.2 m. above sea level. 

Management Programs:  

The PE is implementing an E&S Management Plan during the construction phase that covered the mitigation and management of E&S risks and impacts identified in the ESIA. The PE will review the existing E&S management plan to reflect the operational phase activities of the Project and ensure consistency with the ESIA, Performance Standards, WBG EHS Guidelines, and regulatory requirements (ESAP item). It will cover at a minimum, water management; hazardous materials management; waste management; emergency preparedness and response; community health, and security; biodiversity management; and stakeholder engagement. It will include E&S legal requirements, specific E&S actions/commitments, responsible entities, monitoring and reporting. 

Organizational Capacity and Competency: 

The Project Manager is responsible for the overall HSE performance of the Project. The Project employs an E&S Lead, HSE Lead, Social Expert, Community Liaison Officer (CLO), and Head of Human Resources and Operations, through secondment from Abkons. These key E&S staff report directly to the Project Manager. 

Emergency Preparedness and Response: 

The Project has an Emergency Preparedness and Response Plan (EPRP) that describes potential emergencies, responsibilities, incident reporting, training, and measures to prepare for and respond to these situations. The PE has designated emergency assembly points on site and provided fire extinguishers at certain points of the site. The EPRP will be reviewed and updated to specify conditions during operations, determine if additional measures are required for flooding, identify coordination with neighboring residents, describe internal and external communication protocols and reporting lines, training requirements, evacuation areas and routes, and Emergency Response Team members and their responsibilities during operations (ESAP item).   

Monitoring and Review: 

The PE will update and implement the E&S Monitoring Plan for operational phase as part of the OESMP, detailing monitoring requirements, location, frequency, performance indicators, targets, responsible staff, and corrective actions (ESAP item). The PE will regularly monitor and assess the Project’s HSE performance and compliance with E&S commitments and requirements during operation  

The PE monitors and reports environmental parameters to NEA to comply with regulatory requirements. The PE also develops weekly and monthly HSE monitoring reports, which describe monitoring findings, HSE incidents and observations, trainings conducted, activities performed, amounts of resources used and wastes generated, and recommendations. The Project will also be required to submit annual monitoring reports to MIGA, reporting its E&S management performance. 

The PE will submit a construction close-out report to provide information regarding the measures implemented during the final stage of construction and EHS conditions of the Project and areas temporarily used by the Project (ESAP). It will also describe if committed actions were implemented and actions to address potential gaps.  

Stakeholder Engagement: 

The Project has a Stakeholder Engagement Plan (SEP) that describes stakeholder identification and analysis, engagement methodologies, grievance redress mechanism, and action plan. Public consultation activities were conducted as part of the EIA and the land acquisition process. The CLO communicates with village leaders and community members to discuss project-related concerns and requests.  

The PE will update the SEP and specify responsible staff and their responsibilities, as well as concrete activities and engagement methodologies that enable open communication with the local communities during the operations phase (ESAP item).  

External Communication and Grievance Mechanisms: 

The PE discloses Project information, EIA report, Stakeholder Engagement Plan, Grievance Mechanism, and Land Acquisition Procedure through the Project website (https://www.spvblue.com/). Prior to the construction, Project information was disseminated through project leaflets, posters, and bulletin boards.  

The external grievance mechanism is also disclosed to the public. Grievances can be lodged verbally or in writing via e-mail or phone, published on the Project’s website. The CLO is responsible for accepting, addressing, and monitoring grievances, as well as managing the grievance register. The details of the Project’s grievance mechanism are described in the SEP. 

PS2:  Labor and Working Conditions 

The PE engages 19 employees for the Project operation. Two employees are directly employed by the SPV, while the remaining 17 employees are seconded from Abkons, which is the Project’s O&M contractor 

Working Conditions and Management of Worker Relationship:  

The Project adopts Abkons’ set of human resource (HR) policies and procedures that are compliant with applicable labor laws, including regulatory requirements related to terms of employment and workers’ benefits. This includes a Human Rights Policy, which stipulate compliance with Albanian laws and applicable international standards (ILO). The Policy recognizes freedom of association and collective bargaining, diversity and inclusion, non-discrimination, equal opportunity, as well as prohibition of child labor, forced labor, and human trafficking.  

Through the Project’s Code of Conduct, the PE commits to uphold integrity and ethics in its operations through its business principles and requirements. The Code describes employees’ responsibilities and prohibited actions and behavior. The Code of Conduct applies to all workers, subcontractors, suppliers and other parties acting on behalf of the Project.  

The HR policies, procedures, and Code of Conduct will be updated to be project-specific, stipulate compliance with the PSs, staff responsible for implementation, gender-based violence (GBV) and sexual harassment, as well as communication strategies to inform all workers about their rights and responsibilities (ESAP item). 

The Project’s workers are informed about the grievance mechanism through bulletin boards and pamphlets. They can file grievances verbally, electronically or through boxes that are placed within the project site. The CLO is responsible for the implementation of the grievance mechanism, including registering workers’ grievances, as well as updating the grievance register. The PE will update the workers’ grievance mechanism to allow anonymous complaints, clarify roles and responsibilities of relevant staff and cover the reporting and management of GBV incidents (ESAP).  

As part of the ESAP, the PE will also provide sanitary facilities in the secondary plot. 

Protecting the Work Force: 

The Project’s Human Rights Policy stipulate the prohibition of child labor and forced labor. This Policy is included in the contractual provisions signed with contractors, sub-contractors and primary suppliers.  

Occupational Health and Safety:  

The Project has a Health and Safety (H&S) Management Plan that describes the process and procedures for identifying, assessing, and managing occupational H&S risks, responding to emergencies, monitoring performance, and reporting incidents. The HSE Lead is responsible for implementing and monitoring the HSE performance of the Project.  

The H&S Plan includes H&S induction trainings, providing information and adequate facilities and tools to reduce workplace hazards (e.g. shaded areas, first aid kits, dangerous wildlife signages), adjusting work time to avoid extreme weather conditions, and implementing PPE use. The HSE Manager tracks HSE related incidents, status of corrective actions, and trainings conducted. The HSE Lead prepares incident reports to investigate the cause of the incident and propose measures to avoid incidents and improve performance. No loss time injury has been reported to date.  

The PE will update the H&S Plan for operations to specify compliance with PS 2 requirements, update responsible staff and applicable H&S risks relevant to the Project operations, training requirements and procedures for reporting and addressing incidents (ESAP). The updated H&S Plan will be included in the OESMP.  

Workers Engaged by Third Parties: 

The PE specified E&S requirements in the tender documents for contractors and sub-contractors. The PE also developed a Contractor Management Procedure, which describes how the Project will monitor and manage the E&S performance of the contractors and subcontractors.  

The contractors and subcontractors are all required to adopt the Project’s E&S policies, procedures, and management plans, as specified in the E&S contractual provisions. The E&S performance of contractors and subcontractors is monitored and evaluated through regular site checks, observations, and audits. In addition, the workers from contractors and subcontractors are able to access the Project’s internal grievance mechanism.  

Supply Chain:  

The Project’s Human Rights Policy and Supply Chain Management Procedure includes provisions for human rights due diligence, action planning, monitoring, and reporting.  The PE conducted a human rights risk assessment of its contractors and a supply chain due diligence. It did not identify any non-compliance. The PE also included provisions relating to forced labor in the supply chain in the contract with suppliers. 

PS3:  Resource Efficiency and Pollution Prevention 

Resource Efficiency  

The Project is estimated to generate 119 747 MWh per year with greenhouse gas reductions of 1 912 tCO2 per year. Solar batteries are used to store energy needed in case of emergencies, such as an emergency shutdown.  

The Project sources its water from the local municipality through third-party contractors., The Project uses water for domestic use and cleaning the panels. Approximately 110 m3 of water is needed for each wet cleaning, which is carried out two to four times a year.  

Pollution Prevention: 

Wastes generated during construction have been cleared except for the top soil, which is stored on site and will be used in the revegetation and restoration of vacant areas within the Project site. With the implementation of mitigation measures, there have been no reported exceedances of dust and noise limits, nor any significant incidents such as spills to date. 

During operations, the Project is expected to generate minor to moderate amounts of wastes and pollutants to air, noise, water, and soil which are anticipated to be readily mitigated through the implementation of standard pollution prevention and control measures, defined within the ESMP. The PE will update the Pollution Prevention Plan, Hazardous Materials Management Plan, and Waste Management Plan to avoid and mitigate potential environmental impacts during operations (ESAP item). This update will also cover erosion and sediment control for the drainage channels, as well as the storage and management of hazardous wastes, including broken solar panels and other electrical wastes that will be generated on site. 

The PE segregates wastes using waste bins for recyclables and general wastes. These will be collected and disposed by licensed contractors. The PE will also contract an accredited waste company to collect and dispose hazardous wastes (ESAP item). Domestic wastewater is collected in a septic tank on site and removed by authorized contractors for disposal in a wastewater treatment plant.  

The PE avoids using chemicals to clean the panels by using filtered water only. It also employs mechanical methods to manage vegetation on site. Pesticides or herbicides will not be used.  

PS4:  Community Health, Safety and Security 

Community Health and Safety   

The PE developed a Community Health and Safety Plan that describes actions to minimize and manage impacts on local communities. Specific measures include, but are not limited to, prevention of bushfires, and implementing safe driving, minimizing pollution and disturbance. The effectiveness of these measures is covered in the HSE monitoring.   

The Project has an external grievance mechanism, established to accept and address complaints from the public and local community members. This mechanism is under the responsibility of the CLO and described in the SEP.  

Security Personnel 

The PE contracts an authorized security company to provide security services for the Project. The PE implements a Security Management Plan that specifies the roles and responsibilities of security personnel, and applies to the security contractor. The security personnel are assessed and trained before engagement. They are included in the Project’s HR, compliance, and OHS trainings and are required to follow the Project’s Code of Conduct. 

PS5:  Land Acquisition and Involuntary Resettlement 

The project site covers an area of 87 hectares of former agricultural land, consisting of 12 parcels of previously privately owned land which was used for grazing by local community members prior to project construction. The land for the 1.6 km OHTL transects state/municipal land and a Collaboration Agreement with the Fier Municipality gives the Project the right to use the land for the OHTL. 

The Project acquired the land on a willing buyer-willing seller basis and has developed a Resettlement Action Plan and to compensate informal land users, including community members previously engaged in grazing of animals. The plan includes a grievance mechanism for claims or grievance related to land acquisition or land use impacts.   

PS6:  Biodiversity Conservation and Sustainable Management of Living Natural Resource  

The project is located on a flat low-lying area near the coast, within the Illyrian deciduous forests ecoregion which extends along the coastal ranges of the East Adriatic coast. The site was reclaimed land created for agriculture. The wider area includes wetlands and coastal lagoons, river deltas, sand dunes and coastal pine forests. The project is inside of the Adriatic Migration Flyway which is a bottleneck site for migratory birds. The site does not overlap but is relatively close (between 5 to 10 km approx.) to protected and internationally recognized areas, mainly designated for their importance for birds. This includes Divjaka-Karavasta National Park, the Pishë-Poro protected area, and the Divjaka sand dunes (natural monument).  

The project footprint is 85.1 ha and modified, with the exception of 0.3 ha of marshland under the transmission line. The PV site is located on abandoned agricultural land, used by the local population for animal grazing. The site also contains a network of irrigation channels that is not currently used. Vegetation was dominated by salt and water tolerant plant species, and included pioneer species, and presence of alien and invasive species. The access road has minor overlap with wooded sand dunes.  The OTHL route and buffer area included agricultural land, pasture and areas used for hay production.  

Prior to construction, the PV site was abandoned agricultural land undergoing natural successions to former brackish water and salt marshes, with some freshwater habitats existing in former irrigation/drainage channels and seasonal rainwater pools. Restricted range fish and the VU Albanian Water Frog were present in drainage channels and seasonal rain fed pools. In addition, several important bird species are present in the wider area: VU European Turtle Dove, nationally CR Pygmy Cormorant, nationally EN Eurasian Sparrowhawk, nationally EN Great White Egret, nationally EN Black-winged Stilt, nationally CR European Roller and nationally EN European Bee-eater, nationally CR Dalmatian Pelican and the Greater Flamingo. 

Key mitigation during construction included avoidance of areas important for biodiversity (retaining the drainage channels), and implementation of standard good practice construction measures to maintain drainage and avoid dust, erosion, sedimentation, and introduction of invasive species. Following construction, the PE will update and implement a Revegetation and Rehabilitation plan to restore and enhance the remaining habitat on the PV site (e.g. by planting local species, recreating freshwater ponds, restoring channels, using topsoil stored during construction) (ESAP).  

During operations, the risk of bird and bat collisions will be reduced through the installation of line markers . As committed in the ESIA, the Project will install bird diverters on the OHTL prior to the connection to the new Hoxhara substation to mitigate the risk of bird collisions (ESAP). In addition, the project will carry out Post Construction Fatality Monitoring (PCFM) for the two years following commissioning of the project. If results indicate significant mortality, additional mitigation will be identified and monitoring extended (ESAP). 

The ESIA identified fishing as one of the ecosystem services provided by the drainage channels and marshy areas around the site.  In addition, the wider area provides aesthetic value for both residents and tourists. The ESIA concluded that no significant impacts to ecosystem services would result from project construction and operation.   

The documentation listed below is available electronically as PDF attachments to this ESRS at www.miga.org.