Environmental and Social Review Summary
Kodeni Solar Project, Burkina Faso
This Environmental and Social Review Summary (ESRS) is prepared by MIGA staff and disclosed prior to the date on which MIGA’s Board of Directors considers the proposed issuance of a Contract of Guarantee. Its purpose is to enhance the transparency of MIGA’s activities. This document should not be construed as presuming the outcome of the decision by MIGA’s Board of Directors. Board dates are estimates only.
Any documentation that is attached to this ESRS has been prepared by the project sponsor, and authorization has been given for public release. MIGA has reviewed the attached documentation as provided by the applicant, and considers it of adequate quality to be released to the public, but does not endorse the content.
MIGA has been asked to provide a guarantee for a period of up to twenty years to cover equity investments and shareholder loans provided by Africa REN Invest Ltd (Africa REN) to Kodeni Solar S.A.S.U. for the development of the Kodeni Solar Project in Burkina Faso (“Kodeni” or “the Project”).
Kodeni is developed by Africa REN, an Independent Power Producer based in France and Mauritius with current renewable energy assets in Senegal. A separate Project Company (Kodeni Solar S.A.S.U.) has been formed as special-purpose vehicle in Burkina Faso to develop and manage the Project.
The Project consists of the development, construction and operation of a greenfield photovoltaic (PV) solar power plant, including PV modules mounted on single-axis trackers, inverters, step-up transformers, and supporting infrastructure such as maintenance buildings, control room and offices, and internal access roads. The installed capacity will be 38 MWp with an estimated yearly production of 67,2 GWh. The Project will be located in Bobo-Dioulasso, around 350 km south-west of Ouagadougou.
The solar plant will be connected to the national power grid through an existing substation managed by the national utility SONABEL. A 3,4 km long underground transmission cable will be constructed to connect the plant to the grid. Financing and construction of the cable will be undertaken by the Project Company, and ownership transferred at commissioning to SONABEL which will then be responsible for operation and maintenance. The transmission cable is considered an Associated Facility of the Project, as defined by the MIGA Performance Standards. The Project Company will be managing the construction of the transmission cable although once transferred, the cable will be owned, operated and maintained by SONABEL, and the Project will have no control and only limited leverage over the management of its operation and maintenance.
Construction activities will include clearing of the sites, the transport of equipment on site, the installation of photovoltaic solar modules and supporting inverters and transformers, electric meters, technical rooms, access roads, fences and a site security and surveillance system. During the operational phase, activities will be limited to daily monitoring, cleaning of modules as needed, maintenance of vegetation under and between modules, and maintenance of electrical components and installation fencing.
An Engineering, Procurement and Construction (EPC) Contractor is currently being selected through an international competitive process and a separate Operations and Maintenance (O&M) Contractor will be procured for the operations phase. Construction is expected to start in 2020, and last around 12 months.
The Project is located on a 80 ha plot south-west of Bobo-Dioulasso. There are no buildings or other types of infrastructure within the area. The site was historically used for seasonal crop farming and animal grazing by the local communities but is currently barren and not cultivated. Another solar plant implemented by SONABEL and sponsored by KfW is planned adjacent the Project site, and there is also plans for a housing project in the same area. A joint access road for the two solar plants and the housing project is being constructed.
MIGA has also been asked to provide guarantees covering investments for four other solar plants in Burkina Faso, disclosed under separate ESRSs available on MIGAs website.
The Project is categorized as Category B according to MIGA’s Policy on Environmental and Social Sustainability (2013) because the potential adverse impacts are site-specific, largely reversible and readily addressed through mitigation measures. Key potential environmental and social (E&S) risks and impacts related to the Project are economic displacement and livelihood impacts; water management and use; contextual security risks; labor and community health and safety risks; and the implementation of environmental and social management system and procedures.
While all Performance Standards are applicable to this investment, based on our current information, the investment will have impacts which must be managed in a manner consistent with the following Performance Standards (PS):
- PS1: Assessment and Management of Environmental and Social Risks and Impacts
- PS2: Labor and Working Conditions
- PS3: Resource Efficiency and Pollution Prevention
- PS4: Community Health, Safety and Security
- PS5: Land Acquisition and Involuntary Resettlement
The Project is located on heavily modified farmed and fallow land and there are no significant impacts related to biodiversity, thus PS6 Biodiversity Conservation and Sustainable Management of Living Natural Resources does not apply. There are no Indigenous Peoples within the Project area of influence, and therefore PS7 Indigenous Peoples does therefore not apply
No sites of cultural / historical value were identified within the boundaries of the project areas, neither were any resources of heritage value identified. PS 8 Cultural Heritage does therefore not apply; however, a Chance Find Procedure will be developed and implemented under PS1.
In addition, the following World Bank Group Environmental, Health, and Safety (WBG EHS) Guidelines are applicable to the Project:
- General EHS Guidelines (2007)
- Sector specific guidelines for Electricity Transmission and Distribution (2007)
The following documents were reviewed by MIGA:
- Provisional Environmental Impact Assessment Study: Kodeni Solar Plant. Engineering & Environment Services, November 2019.
- Environmental and Social Due Diligence: Kodeni Solar. IBIS Consultants, March 2020.
- Draft Engineering, Procurement, and Construction Contract. January 2019.
- Supplementary Livelihoods Restoration Program. OSIEC SAS, March 2020.
- Land Acquisition Process and Principles for Compensation. Africa REN, August 2019.
- Community Engagement Protocol [Protocole D’Accord], between Kodeni Solar and the 6th District Municipality of Bobo-Dioulasso. October 31, 2019.
In addition to reviewing the above documents, MIGA conducted due diligence calls with the Project Company and its consultants. The lender’s E&S consultants carried out an E&S due diligence visit in February 2020 which included meetings with the Project Companies and consultants, E&S staff, and affected communities, as well as tours of the Project sites.
MIGA’s due diligence review considered the environmental and social management planning process and documentation for the Project, and identified gaps (if any) 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
Africa REN has a Corporate Health, Safety and Environment Policy Statement in place, setting out the guiding principles and standards for Health, Safety and Environmental (HSE) requirements, applicable to the Project and related infrastructure. The policy statement affirms the Company’s commitment to develop the Project in a safe and socially responsible manner, including adherence to the requirements of the Performance Standards.
Identification of Risks and Impacts:
An Environmental and Social Impact Assessment study (ESIA) has been prepared for the Project, in accordance with local regulation and the requirements of the PSs. It was conducted by Engineering and Environmental Services, a local environmental consultancy. The final version of the ESIA was approved by BUNEE and Kodeni Solar is awaiting for the environmental certificate from the Ministry of Environment. Associated infrastructure such as the transmission cable and access road are part of the scope for the ESIA study.
An Environmental and Social (E&S) Due Diligence of the Project and the ESIAs against the requirements of the PSs was commissioned by the lenders in February 2020 and conducted by IBIS, an international consulting firm. The main gaps identified by IBIS were related to establishment of management plans and compensation of project-affected persons without formal land titles. These gaps are being addressed by the Project Companies, as further described below.
Potential cumulative impacts were considered in the ESIAs, including the adjacent SONABEL solar plant and the planned housing project. Material cumulative impacts are not expected since the time frame for development of the different projects are different and construction will not happen at the same time, but management of cumulative risks will be considered in the Kodeni Project’s management plans.
The ESIA includes a framework for an Environmental and Social Management Plan (ESMP), which provide principles for preventing and mitigating environmental and social impacts, in both construction and operation phases. The Project Company has engaged OSIEC, an environmental consultancy, to establish an ESMS and finalize the ESMP (as per the ESAP), based on the findings of the ESIA, Africa REN’s policies, applicable local regulation, and the PSs. The ESMS will include provisions for risk identification, organization and responsibilities, disclosure of information and reporting. The ESMS will also include a set of sub-management plans for inter alia occupational health & safety, emergency response, waste and recycling, water use and management, biodiversity, chance find procedure, stakeholder engagement, grievance management, and monitoring.
As required by the contract, the EPC Contractor will implement the ESMP, overseen by the Project Company. An ESMP for the operations phase will be developed prior to commencement of operations, as per the ESAP.
Organizational Capacity and Competency:
The Project Manager has the overall responsibility for compliance with E&S requirements and related coordination with authorities, contractors and other stakeholders. OSIEC will act as advisor to the Project throughout the development phase, including questions around implementation of the ESMS, monitoring of Environment, Health and Safety (EHS) aspects in construction, stakeholder engagement, the grievance mechanism, and capacity building. OSIEC will also provide an on-site EHS Officer, reporting to the Project Manager, and a Community Liaison Officer. Africa REN will also provide support to the Project through its corporate level E&S Manager based in Senegal.
The EPC Contractor will appoint an EHS Manager responsible for overseeing the implementation of the ESMP, monitoring and inspections, training, and reporting to the Project Company and relevant authorities. The EHS Manager shall be suitably qualified and have prior experience from overseeing ESH management in construction projects. In addition, each sub-contractor will be required to appoint an EHS Officer.
As per the ESAP, the Project Company will notify MIGA of the appointment and qualifications of the ESH Manager prior to the start of construction.
Emergency Preparedness and Response:
An Emergency Response Plan will be a part of the ESMS, which will include for example procedures for responding to fire and explosion, spills, loss of containments of dangerous substances, traffic incidents, safety and security incidents, and malicious acts. The procedures and responsibilities for emergency response actions and communication will be clearly defined and available on-site.
The plan will also include provisions for communication, resources, and training and updating of the Emergency Response Plan, and coordination with SONABEL for the solar project planned adjacent the Kodeni site.
Monitoring and Review:
As part of the ESMS, monitoring and reporting procedures on EHS impacts related to construction and operation will be established and implemented. Monitoring frequencies, methodology and indicators will be reflective of the risks and impacts identified in the ESIA. The EPC Contractor will report to the Project Company, which will report to authorities as required, disclose monitoring results and provide feedback to affected communities on at least an annual basis in relation to any impacts affecting them and associated mitigation measures. Annual monitoring reports will also be developed and submitted to MIGA.
In 2019, during the ESIA processes, several community consultation activities were completed with various groups of participants, including landowners, women, youth and local authorities. Stakeholder meetings were held to discuss the Project and to provide an opportunity for the affected communities to raise any concerns. Issues raised during the meetings primarily included employment opportunities, support for road maintenance and other community support measures.
A Stakeholder Engagement Plan (SEP) will be developed as part of the ESMS (as per the ESAP), building on the engagement undertaken as part of the ESIA. In addition to outlining procedures for information sharing between the Project and affected parties, the SEP will include the establishment of a committee for managing all questions related to local employment, and a committee for engaging external stakeholders in monitoring outcomes of the Project. Both committees will consist of representatives of the Project, affected persons, and local authorities. The SEP will cover both construction and operations phases.
A Community Engagement Protocol has also been agreed between the Project and local Municipality, setting out the principles for communication between the Project and Municipality, and responsibilities regarding community involvement and development, including establishment of the committees described above.
External Communication and Grievance Mechanisms:
A grievance mechanism will be established as part of the SEP, implemented by the Project Company, with the purpose to ensure that all complaints or other communications received from communities or other stakeholders are responded to and managed appropriately. This includes recording any stakeholder comments or complaints and ensuring that they are passed on to the relevant party for response and resolution as soon as practicable. If the grievance is related to the EPC Contractor’s activity, the EPC Contractor will work with the Project Company to address the complaint.
PS2: Labor and Working Conditions
Construction works for the plant will generate about 150 jobs for up to one year, and operations will involve about 20 full-time workers. Construction staff will be housed in nearby towns, and there will be no accommodation on the Project site.
A local recruitment committee will be established (as per the ESAP) composed of representatives from the local authorities, affected communities, EPC, and the Project Company. The committee will handle job applications and pre-selection of local candidates and ensure fair distribution of labor requests between the local villages. The committee will also administer training programs and presentations of employment and business opportunities. Recruitment at the entrance of, or close to the project site, will not be permitted.
Working Conditions and Management of Worker Relationship:
The EPC contract will require the Contractor to observe applicable labor laws and comply with the requirement related to working conditions in line with PS2, and it will also require the Contractor to ensure that these requirements is passed on to sub-contractors. Relevant HR policies and procedures for the construction and operations phases will be established (as per the ESAP) to cover all workers, including direct workers and contracted workers. At a minimum, the HR Policies will include the following provisions: working relationship; working conditions; terms of employment; workers’ organizations; non-discrimination and equal opportunity; grievance mechanism; prohibition of child and forced labor; and occupational health and safety. The conditions of employment and worker’s rights will be communicated to all new employees during the induction process.
The HR policy and employment contracts will allow for employees to join or form worker’s organizations. A staff representative will also be appointed, responsible for bringing employee’s concerns or requests to the management.
Protecting the Work Force:
In line with Kodeni Solar policies, child and forced labor is prohibited in relation to the Project. The EPC Contractor will be contractually bound not to use any forms of forced labor, and to observe applicable laws and PS2 requirements related to child labor.
Occupational Health and Safety:
The ESIA includes a description of Occupational Health and Safety risks (OHS) and impacts during construction and operations, with a series of preventive measures. The main risks and impacts will include heat exposure, traffic safety, exposure to welding light and fumes and potential for fires and/or explosions resulting from ignition of flammable materials or gases. As part of the ESMS, the EPC Contractor will develop and implement an OHS Management Plan. This will include organization, identification of risks and prevention measures, scheduling of meetings and trainings, permit-to-work procedure, and medical check-ups.
Workers Engaged by Third Parties:
As stated above, the Project Company will include EHS provisions in the EPC and O&M contracts and contracts with other sub-contractors providing services to that Project Company’s operations. These provisions will include as a minimum: compliance with labor legislation, terms of OHS management, and access to a workers’ grievance mechanism including review and response to anonymous complaints. The Project Company will monitor third-party compliance with approved EHS requirements.
PS3: Resource Efficiency and Pollution Prevention
During construction water will be primarily required for building foundations for the solar plant, as well as for sanitary purposes and dust control. A total of around 5000 m3 of water will be required for construction purposes (sanitation, drinking, construction, watering tracks, etc.). During operations water will be used for sanitary purposes and to clean the panels during operations. The frequency of cleaning depends on weather and climatic conditions, the estimated water usage will be around 150 m3 per month.
The Project Company will undertake a water resource study prior to construction (ESAP item), to assess options for meetings water requirements during operations, including connecting to the public water distribution network and whether water can be extracted from the ground aquifers to meet the water requirements for operations, whilst ensuring that extraction will not affect the local community’s resources. If sufficient water is not available, water will be supplied by trucks.
According to the ESIA, the Project will lead to greenhouse gas emissions reductions equivalent to approximately 50 000 tons of carbon dioxide per year.
During construction, a minor amount of air, noise and water emissions are anticipated, which will be mitigated through standard pollution prevention and control measures. During the operational phase, environmental pollution will be limited to wastewater and waste generation. The EPC Contractor will be required to implement pollution prevention measures in the ESMP to mitigate the risk of any pollution, with specific provisions for erosion and sediment control, effluent management, chemical management, and waste management.
The measures indicated in the ESMP of the ESIA include the use of proper equipment, vehicle and roads maintenance, timely dust suppression measures, speed restriction, etc.
According to the ESIA, during construction waste will primarily consist of wood residues, pallets and packaging material, metal scraps, and domestic waste. During operations, waste will be mostly generated at the offices, along with mineral oil from transformers, and sanitary effluents. A waste management procedure has been developed as part of the ESMP, including characterization of waste by type, quantities, and potential use; opportunities for source reduction, as well as reuse and recycling; procedures and operational controls for onsite storage; and final disposal.
Mineral insulating oils will be used to cool transformers in operations phase. These oils will be handled by trained personnel to ensure that manufacturers’ recommendations are strictly followed. Provision of secondary containment, drip trays or other overflow and spill containment measures will be implemented in designated areas. Vegetation control will be carried out manually without any pesticide use. Hazardous material will also include broken solar panels. The waste management system described above will include used hazardous materials and will address issues linked to waste minimization, generation, transport, disposal, and monitoring.
Apart from runoff water from cleaning the solar panels, only sanitary wastewater will be generated during operations. As there is no sewage collection network at the site, a septic system will be used, designed and installed in accordance with local regulations and the WBG EHS Guidelines to prevent any hazard to public health or contamination of land, surface or groundwater.
Decommissioning and rehabilitation plans will be developed prior to decommissioning the solar plants and associated infrastructure. Such plans will include, but will not be limited to, management of socio-economic aspects such as employment loss, removal, re-use and recycling of materials and vegetative rehabilitation to prevent erosion.
PS4: Community Health, Safety and Security
Community Health and Safety
The Project is located in a rural and sparsely populated area. It is surrounded by rural communities grouped in villages and hamlets, the closest of which is the town of Matourkou at around 1.5 km from the Project site, with an approximate population of 2,000.
Construction traffic is the primary potential adverse community health & safety impact associated with construction. A Traffic Management Plan will be developed and implemented as part of the ESMP, including training & certification, vehicle safety procedures, signage, and awareness campaigns in affected communities.
Community impacts related to in-migration are expected to be low and short-term due to the relatively short duration of the construction works. As indicated under PS1, as the construction phases of the two solar projects are unlikely to coincide, there are unlikely to be cumulative impacts from in-migration. In-migration will be minimized and managed through the ESMP and local recruitment committee, prohibiting the use of short-term workers and recruitment at the site, and the communication of qualified job opportunities on a national level.
As discussed under PS3, the quantities of hazardous materials are limited, and the materials are managed in a suitable manner to avoid community exposure to these materials.
The community exposure to disease around the plant is limited as the sites are located in sparsely populated areas. The Project will be implementing worker’s health programs to screen the health of workers, and a Communicable Diseases Awareness Campaign will be implemented in the communities surrounding the Project as part of the ESMP. A Code of Conduct for employees will be established, covering rules of interaction with local communities, addressing respect for local beliefs and customs and with special attention for risks related to sexual harassment, gender-based violence, and prostitution.
As indicated under PS1, the Project will develop and implement an Emergency Preparedness and Response Plan which covers the procedures for informing stakeholders and responding to emergencies.
Site security will be managed by a private security firm who provides trained, unarmed security personnel. The Project Company will ensure that the security contractor operates in a manner which meets the requirements of local regulation and Performance Standard 4, through the implementation of a Security Management Plan as part of the ESMS (ESAP item), including commitment to the Voluntary Principles on Security and Human Rights, rules for use of force, and code of conduct.
The site will be fenced to prevent public access to the solar plant.
PS5: Land Acquisition and Involuntary Resettlement
The Project site was selected to minimize displacement. No physical displacement is required, and the site has not been cultivated in the last decades but community members from the villages of Logofouroussou and Matourkou, primarily women, use the area to pick natural fruits or gather firewood.
The Project will be connected to the grid via an underground cable, which will not require any physical relocation.
Customary land right is the accepted and dominant form of land rights in the Project area, and there are no legal titles registered for the Project site. A Land Acquisition and Compensation Process (LACP) was agreed upon through a series of consultations between the Project Company, village elders, local authorities, and customary land owners. The consultations resulted in recognition of customary rights to the site for 6 households from Logofouroussou who had been allowed to cultivate the land by the village chief, as well as an area of the Project site recognized as communal land for the Matourkou village.
In line with the LACP, cash compensation was paid to the customary land owners (6 households) for loss of assets, i.e. trees. The compensation rates were reviewed by IBIS and confirmed to be based on market value and constitute full replacement cost as required by PS5. In-kind compensation for loss of land will be provided to the six households with customary rights, through the allotment of replacement plots located 3-5 km from the Project site. The replacement areas have been identified by Municipality of Bobo-Dioulasso and purchased from the previous owners through a willing-buyer willing seller process, which was confirmed also by IBIS. The households affected by the Project will receive legal titles to their replacement plots.
A Supplementary Livelihood Restoration Plan (SLRP) has been developed and will be implemented by the Project to address compensation for women using the area to pick natural fruits and firewood, and as well as community support programs identified based on consultations conducted as part of the ESIA studies. The LRP also builds on the Community Engagement Protocol signed between the Project and the Municipality. The details of the programs will be elaborated in consultation with the Project monitoring committee (see PS1) and representatives of the affected households, and may include agriculture productivity programs, support for electrification, livelihood diversification for women, tree planting and management, and a welfare program for vulnerable households. Eligible for participation in the support programs will be members of the Logofouroussou and Matourkou communities. The SLRP also makes reference to the community grievance mechanism which will be implemented as part of the ESMS (see under PS1), which will also be open for resolution of issues related to land acquisition.
The review conducted by IBIS of the land acquisition process against the requirements of PS5 concluded that the SLRP should be revised to consider legal process for land registry and titles, consistency of allocation rules of plots for the affected households, coordination with the Municipality regarding land acquisition for the adjacent housing project and access road, consideration of vulnerable households, and establishment of livelihood support programs as described above. The SLRP will be revised to address these gaps, and an SLRP close out audit will be conducted by a third party within one year following the completion of the SLRP. (as per the ESAP).
The Environmental and Social Impact Assessment Study for the Project will be made available electronically as an attachment to this ESRS once the final version is available.
MIGA supports its clients (as defined in MIGA Policy on Environmental and Social Sustainability) in addressing environmental and social issues arising from their business activities by requiring them to set up and administer appropriate grievance mechanisms and/or procedures to address complaints from Affected Communities.
In addition, Affected Communities have unrestricted access to the Compliance Advisor/Ombudsman (CAO), the independent accountability mechanism for MIGA. The CAO is mandated to address complaints from people affected by MIGA-guaranteed business activities in a manner that is fair, objective, and constructive, with the goal of improving environmental and social project outcomes and fostering greater public accountability of MIGA.
Independent of MIGA management and reporting directly to the World Bank Group President, the CAO works to resolve complaints using a flexible, problem-solving approach through its dispute resolution arm and oversees project-level audits of MIGA’s environmental and social performance through its compliance arm.
Complaints may relate to any aspect of MIGA-guaranteed business activities that is within the mandate of the CAO. They can be made by any individual, group, community, entity, or other party affected or likely to be affected by the environmental or social impacts of a MIGA-guaranteed business activity. Complaints can be submitted to the CAO in writing to the address below:
International Finance Corporation
2121 Pennsylvania Avenue NW
Washington, DC 20433 USA
Tel: 1 202 458 1973
Fax: 1 202 522 7400
Broad Community Support is not applicable for this project.