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Environment and Social Monitoring Report Semi-Annual Environment and Social Monitoring Report Project Number: 47919 – 014 December 2020 Georgia: Adjaristsqali Hydropower Project Prepared by Adjaristsqali Georgia LLC for Asian Development Bank This environmental and social monitoring report is a document of the borrower. The views expressed herein do not necessarily represent those of ADB's Board of Directors, Management, or staff, and may be preliminary in nature. In preparing any country program or strategy, financing any project, or by making any designation of or reference to a particular territory or geographic area in this document, the Asian Development Bank does not intend to make any judgments as to the legal or other status of any territory or area.
SEMI-ANNUAL ENVIRONMENTAL AND SOCIAL MONITORING REPORT REPORTING PERIOD: 01 July 2020 –31 December 2020
TABLE OF CONTENTS Sr No Chapter Page No 1 Certification …………………………………………………. 3 2 Summary ……………………………………………………. 4 3 Compliance evaluation …………………………………….. 7 4 Major environmental and social achievements …………. 8 5 Major challenges and issues for the Company …………. 9 6 Key Project implementation data relevant to E&S ……… 11 performance evaluation 7 Compliance with IFC Performance Standards / ………. 12 EBRD Performance Requirements / ADB Safeguard Policy Statement (SPS) Annexure 1 HSE Performance Indicators ……………………………… 33 Annexure 2 E&S and HR KPIs 36 Annexure 3 Construction Phase Environmental and Social Action Plan (ESAP) as per Schedule 12 ……………………. Annexure 4 Action List 2
SEMI-ANNUAL ENVIRONMENTAL AND MONITORING REPORT 1. Certification: Georgia: Adjaristsqali Georgia LLC Semi-Annual Environmental and Social Monitoring Report (SAMR) Reporting Period: July 01 – December 31, 2020 Company and Project Information: Company: Adjaristsqali Georgia LLC ("AGL" or "the Company") Physical address of the Company: 129, Bagrationi Street Batumi - 6010 Georgia Company website: www.agl.com.ge Project: The development, construction, operation and maintenance of the Shuakhevi and Skhalta hydro-electric power plants with total electricity generation capacity of 187MW located on the Adjaristsqali River in Georgia. Authorised AGL representative who can be contacted by Lenders on the SAMR: Name: Rakesh Naik Title: Chief Executive Officer Company: Adjaristsqali Georgia LLC Tel: +995 577 691 968 Email: rakesh.naik@agl.com.ge Name: Anand Solanki Title: Chief Financial Officer Tel: +995 577 078 870 Email: anand.solanki@agl.com.ge Certification of the SAMR by Adjaristsqali Georgia LLC I certify that the data contained in this SAMR completely and accurately represents Adjaristsqali Georgia LLC during this reporting period. Anand Solanki ________________________________________________________________ Adjaristsqali Georgia LLC Signature 3
2. Summary: For the reporting period, the Shuakhevi Hydropower Project (the Project) has been operating smoothly and has generated about 29.62 Million units between 1st July 2020 and 31st December 2020, while the total generation as of 31st December 2020 since commencement of commissioning trials in February 2020 being about 258.27 million Units. All tunnels have been in operations with water transfer from Chirukhi and Skhalta being affected as envisaged under the overall project scheme. The balance works related with commissioning of 35 Kv line from Skhalta and Shaukhevi have also been completed and the line was charged on 9th October 2020. Below is a summary of commissioning works & remaining construction works for the reporting period: Civil Works: The civil works remaining in Skhalta, Didachara & Shuakhevi PH have been completed. all SDAs are completed. Tunneling Works: All finishing works in tunnel adits including grouting have been completed and taken over by AGL. Draining arrangement at HPHRT was commissioned in September. Didachara dam area: Repairs to LLO gate and structures were completed. Grouting works inside leakage gallery and on downstream face of dam was completed by AGE. Skhalta dam area: Skhalta bypass tunnel adit grouting works completed by AGE to attend the leakages. Skhalta Powerhouse: All balance preparatory works were completed with remote support from the OEM team. Trial synchronization of all the 3 Units was also completed during October 2020. Further load trials and commissioning activities would be taken up once adequate inflows are available. It is expected that Skhalta HPP would be now commissioned in Q1 2021. Diakonidze Weir: This scheme is under hold and may be taken up later at a suitable time. 35 kV Transmission Line: Subsequent to completion of all construction activities, and submission of all documentation related to completion of 35 Kv line has been submitted to Shuakhevi & Khulo Municipality in the prescribed formats, relevant approvals from GSE and inspections were completed, and clearance was obtained for charging of the 35 Kv transmission line. The line was successfully charged on 9th October and subsequently all associated equipment including outdoor switchyard and transformer at Skhalta were also charged and taken in service. This has enabled completion of all preparatory work for commissioning of Skhalta HPP which is expected in Q1 2021. 3. Compliance evaluation: Was the Company in material compliance with (i) environmental and social (E&S) requirements of the Lenders (ADB, EBRD and IFC), including the "Environmental and Social Action Plan" (Schedule 12 (Form of Action Plan) of the CTA), (ii) environmental, health and safety regulations, standards, and permits of the host country? If No, please summarize the non-compliance status and corrective actions that were taken or being taken. The present report covers the period of the operational phase of the Shuakhevi hydropower plant. Shuakhevi Hydropower Plant started commercial operation in March 2020. Persistent efforts were made by the Project team to finalize and implement pre-commissioning preparedness and other 4
outstanding commitments and ensured a smooth transfer to the new phase. AGL has developed the Company’s overarching operations Environmental & Social Management System (ESMS). The comments from ARUP have been received, the document is in the progress of finalization and will be ready in the 2nd Q of 2021. In October 2020 AGL developed a draft Key Performance Indicators (KPIs) linked to the management system objectives and shared it with ARUP/lenders for the approval. The KPIs cover Environment, Social and Human Resources sections (Please see Annexure 2). As for the OHS KPIs, they are established in the OHS Manual. Project Environmental Permit conditions are being verified regularly including ongoing monitoring. Quarterly Geological, hydrological and six-monthly biodiversity reports have been regularly shared with the Ministry of Environmental Protection and Agriculture (MEPA). AGL has obtained only one additional license for operational phase- Drinking Water Usage license for Skhalta HPP and received approval for technical regulation on maximum permissible limits of discharge from WWTP at Khichauri Camp. As for restoration works, most of construction sites were closed and rehabilitated, except Didachara and Khichauri camp areas. Biodiversity monitoring has been conducted as per Biodiversity Action Plan and Low Flow Mitigation Strategies The compliance of the Shuakhevi Hydropower Project with Georgian Environmental Legislation, Environment and Social Impact Assessment (ESIA) requirements and other project documents are regularly monitored through the AGL compliance registry, permit management system and by the Environmental Supervision Agency (ESA) of the MEPA via various inspections. No inspections on E&S issues by ESA have been carried out during the reporting period. Project Environmental Permit conditions are being verified regularly including ongoing monitoring. Geological, hydrological, biodiversity reports have been regularly shared with the MEPA. Biodiversity monitoring has been conducted as per Biodiversity Action Plan and Low Flow Mitigation Strategies. Closing out construction sites and SDAs were ongoing and most of the sites were closed per recultivation plans approved by MEPA. AGL updated HR Handbook which provides policies & guidelines for HR management and monitoring procedures for all AGL employees. Employees’ Grievance Mechanism is in place. The reporting period coincided with the second wave of COVID-19 pandemic in the country, especially Ajara region showed an increasing trend. The Government closed schools and universities, social gatherings were prohibited, and companies were urged to shift to distance mode of working. AGL staff, mainly employees at the Batumi office were shifted to distance regime, only essential E&M staff were traveling to site. AGL limited its physical interaction with communities, however phone calls and assistance request letters from communities were still maintained and responded in a timely manner. AGL elaborated alternative communication tools to meet the requirements of COVID-19 restrictions. Due to COVID-19 restrictions activities planned for the reporting period have been delayed, such as third-part verification audit was shifted to 2021, however the consultant company has been identified and contractual negotiations have been progressed. AGL selected international consultant to undertake the Completion Audit which is expected to commence in Q2 of 2021. 3. Major environmental and social achievements: Please summarize notable E&S achievements of the Company during the reporting year (e.g. awards received, higher performance achieved or recognized, improved community relationship). All environmental monitoring activities were conducted as per the environmental plans despite COVID-19 restriction. During monitoring field experts followed All COVID related requirements. As for the social achievements, AGL launched and successfully implemented business 5
development projects in Chanchakhlo village, an obligation which were taken by the Company under the Memorandum signed in 2019. Initially, locals protested to prepare business development proposals and required the Company to provide business grants for free. Locals demonstrated in front of the school yard in the village and refused to attend business proposal writing trainings which AGL initiated to assist them in developing start-up projects. They even approached the Shuakhevi Mayor and expressed dissatisfaction about this initiation. However, AGL stood firmly on its position and through negotiations and communication reached agreement with locals. 14 proposals were received from Chanchakhlo, and AGL financed 9 of them. The second round of grant submission is planned in Q2 of 2021. 4. Major challenges and issues for the Company: Please summarize major environmental and social challenges of the Company faced with (e.g. major incidents, spills, fire, explosion or unplanned releases, failure of emissions or effluent treatment, legal / administrative notice of violation, penalties, complaints, litigation, protest, negative media attention, chance finds of cultural heritage, labor unrest or disputes, local community and civil society concerns) and actions taken during the reporting year. Minor changes in the original route of 35kV OTL and erection of towers on non-compensated land triggered some complaints from the local inhabitants. AGL commissioned Expert 21 to undertake land valuations but due to COVID-19 restrictions field visits and valuations have been delayed. Valuation process will be finalized in Q1 of 2021. 5. Key Project implementation data relevant to E&S performance evaluation: 5.1. Start of construction date: 26 July 2013 5.2. Start of commercial operation date: 10th March 2020 5.3. Gross electricity generation capacity (MW): 187 MW (Shuakhevi HPP – 178 MW, Skhalta HPP – 9 MW) 5.4. Net electricity generation capacity (MW): 187 MW (Shuakhevi HPP – 178 MW, Skhalta HPP – 9 MW) 5.5. Gross Electricity generated during the reporting year (GWh/year): 29.68 Gwh 5.6. Net Electricity generated during the reporting year (GWh/year). Total, a portion exported to Turkey - NA, a portion delivered to Georgia: 29:41 Gwhr 5.1. Plant capacity factor (%) – Gross Electricity generated (GWh/year) / Gross electricity generation capacity MW x 8,760 hour/year: 17.5% - year 2020 Plant capacity factor 5.2. Number of AGL employees as of December 31 of the reporting year 5.2.1. Number of direct employees of AGL: 66 5.2.2. in total disaggregated as 5 expatriates and 61 Georgians, out of which 12 are women employees. 5.2.3. Contractors: Civil Works Contractor: AGE Batumi Number of employees: 27 out of which 4 are Turkish and 23 Georgians (4 females and 19 males). 6. Compliance with IFC Performance Standards / EBRD Performance Requirements / ADB Safeguard Policy Statement (SPS): 6.1. PS1/PR1/SPS – Assessment and Management of Environmental and Social Risks and Impacts: (a) E&S Assessment and Management System / Policy: Please provide an updated summary description of the environmental, health and safety (EHS) management system of the Company 6
(organizational chart, budget, reporting lines, responsibilities, policies, procedures). Please attach the Company’s latest EHS and social policy statement. If the Company’s EHS management system was internationally certified (e.g. ISO 14001, OHSAS 18001), please attach a copy of the certification. AGL has finalized its Occupational Health Safety (OHS) Management Manual which is aligned to the ISO 45001-20218. The manual solely focuses on health and safety at the workplace, as for the environment it is managed by other applicable documents. The implementation and fulfillment of the OHS system is the responsibility of all employees at various functional level, including contractors, sub-contractors, visitors, etc. AGL EHS management system comprises of 1 HSE Manager. Site audits and inspections are carried out by HSE Manager. Due to pandemic restrictions AGL was unable to carry out tabletop mock drill scheduled with the representatives of the Emergency Agency. It is planned to implement as soon as the situation will stabilize. AGL’s environmental team has full time Environmental Compliance Manager supported with Environmental Consultant Company ERM and a Forestry Officer. During operational phase AGL HSE officer and civil engineer are involved in environment related activities and site inspections to support Environmental Compliance Manager. ERM is in charge of reviewing biodiversity reports and mitigation measures (if any) provided by local experts, updating Statistical Trend Analysis yearly and developing biodiversity monitoring repot once in a year. (b) Based on the actual operation of the Company during the reporting year, please provide a summary of the key risks and impacts that the Company was faced with and the actions taken. For operations phase, E&S processes have been developed. The main focus has been made to safely isolate electrical equipment, outages, and Lock out-Tag out procedures in place during the transition period as this comprises the main activity in Operations. AGL Team continues to provide specific training such as Electrical Safety, Fire Safety, Work at Height, First Aid, etc. to develop Safety awareness for O&M Team. AGL developed An Infection Disease Emergency Response Plan which was shared will all AGL employees and also placed in AGL premises. Daily temperature control and checklists were in place. Protective equipment (face masks, gloves, face shield, sanitizers) were provided at all locations. Company vehicles, dormitories were disinfected twice per month. Health awareness meetings were conducted regularly. Weekly medical checks were provided to all employees including Security Police. (c) Organizational Capacity and Competency: Please provide a summary of the latest organizational structure of the Company (roles and responsibilities) in charge of EHS and social issues. Please provide a summary of training programs carried out including planned capacity building programs, if any. AGL organization capacity has slightly changed for the operations phase. For the reporting period there are 57 employees, where roles and responsibilities are split as follows: - 31 engineers (civil, electric-mechanical, operations) - 1 HSE Manager - 1 Environmental Compliance Manager supported by Forest Officer at project sites. - 1 PR Manager based in Tbilisi. AGL’s Social Department continues its operations with the CSR Manager taking over the lead for managing social issues and stakeholder engagement since March 2020. AGL retained two 7
Community Liaison Officers (CLOs) working in Didachara and Skhalta valleys (Khulo municipality), a Stakeholder Engagement Specialist (SES) responsible for registering and managing grievances, as well as working with the stakeholders around the Shuakhevi HPP and Chirukhi weir in Shuakhevi municipality. Shuakhevi Powerhouse serves as the only ‘PIC’ during the operations phase. At operations phase there are no separate positions of CEO and COO rather than both positions have been combines and the CEO takes overall responsibility of the technical as well as ESHS management teams. As for the rest, positions are split among technical, administrative staff, financial team, legal, etc. The updated Organization Chart has been incorporated below: Figure 1 Organizational Chart GE Alstom Contract Maint. Services during /H &sp. Maint Services Contract for echnicians & Helpers Shuakhevi Skhalta & Chirukhi Security P/H Didachara Skhalta Chirukhists ali Canteen Services Housekeeping ransport Services for Employees Legal Assistant Site Camp Manager Site Environmental Monitoring echnicians / Helpers Competency Building: Detailed training plan for HSE has been developed for all O & M staff including support functions and is being followed. Safety certification training program was conducted by Technical University of Georgia for all O & M staff. Training was conducted to develop awareness among staff towards Waste Management System. Firefighting drill & First aid training was conducted for the entire staff. (d) Emergency Preparedness and Response: AGL has developed Community Risk Assessment which is an integral part of the overarching Emergency Preparedness Plan. The Assessment lists all possible risks associated with the operations of the project, as well as indicates compliance with CDS guidelines. 8
(e) Monitoring and Review: If the Company publicly reported on overall E&S performance (e.g. sustainability report), please describe how it was done. Please also provide a summary of the Company's internal inspections and audits conducted to verify E&S performance compliance. AGL has established internal monitoring procedures to measure the effectiveness of the programs and evaluate its performance against the management plans. On a monthly basis all AGL employees prepare Monthly Review Report which is submitted to the management for review. Minutes of Meetings (MoMs) prepared, and land acquisition, employment data, CSR/LRP database is being regularly updated. AGL has put in a significant effort for internal monitoring of the HSE performance and compliance with the HSE Plans. PTW, JSA, Risk Assessment, and Toolbox Talks have been followed. AGL periodically conducts an inspection process that is inclusive of senior managers from AGL. For O&M stage AGL is continuing all HSE practices, such as Safety Rounds, HS Committee Meetings, Inductions, Trainings, Mock dirills etc. Some Near Miss Incidents that occurred during the reporting period are as below: 1) On 16th of September 2020 a team from EMD was performing routine checks for the Fire detection system by operating individual sensors and confirming their health. They intended to test the control room fire detection sensors. As soon as they activated one sensor, the fire alarm in FACP as well as the control room Inergen gas system started sounding. A special training was provided to the O&M team regarding the specification of Fire Safety Equipment by EMD. AGL Electrical Foreman and Technician were instructed of the same, and also how to check smoke detectors in Control Room 2) On 20th of October while walking at Shuakhevi PH GIS Room, AGL CEO slipped on the oily floor. The Oil was leaking from the Bridge Crane which is installed in the GIS room. luckily, he did not lose control and avoid from injury. As a preventive measure, the crane was parked in a safe area and it was electrically isolated. Also, the floor was cordoned. 3) On 8th of December at Skhalta Security Office, there was a short circuit on the Electrical distribution panel which resulted in a small sparking in the Skhalta Security building. The issue was solved by the security police personal who immediately switched off the central MCB. As a preventive measure, EMD checked all cable connections and they have been installed safely. All events were investigated thoroughly, and corrective and preventive actions have been taken as per findings. The investigation reports were also circulated to AGL management for review and comments for preventive actions. HSE observation system has been developed to ensure a systematic and adequate periodic reporting of safety walkthrough at site. All observations are kept centrally by the AGL HSE Department and data analysis is reported within the organization on a monthly basis. Data analysis for Jul-Dec 2020 are enclosed below. To verify environmental performance, AGL engaged ERM to conduct audit in March 2020. However, ERM team was not able to come to Georgia due to the COVID-19 restrictions. An audit was conducted by ERM in November 2019 & AGL has closed all the audit observations. For operational phase as part of ESMS system AGL is planning to contract ISO certified E&S audit for yearly third-party verification. AGL is in process of finalizing scope of the audit as well as contractual liabilities. 9
(f) Stakeholder Engagement: The Operations Phase Stakeholder Engagement Plan (SEP) was disclosed in February 2020. During the virtual tour with lenders, it was agreed that AGL will update the Ops SEP incorporating stakeholder engagement and consultation during pandemic in accordance with the EBRD and IFC guidance documents. Due to pandemic restrictions and mandatory requirements on social distancing, AGL tailored its social interaction methods with communities. Phone calls and engagement through local actors, such as CLOs and SES were the preferred method of communication by locals. During the reporting period AGE’s human resource was significantly reduced. 7.2 PS2/PR2/ADB’s Social Protection Strategy 2001 – Labor and Working Conditions: (a) Human Resources Policies and Procedures: If the Company received complaints through internal grievance mechanism for workers or through national regulatory agency/courts, please provide a summary of those, particularly about issues of labor union membership, non – discrimination, provision of mandated benefits including wages and medical and other social insurances, involuntary retrenchment, local employment and occupational health and safety. For the reporting period, the project did not receive any grievance through national regulatory agency and courts concerning labour issues. AGL ensures safe and healthy working conditions. Employees are provided with necessary personal protective equipment for carry out work in safe manner. Canteen facility is provided for all staff. First Aid facility is available at the Powerhouse and all work areas. AGL revised HR Handbook and including recruitment policy. Employees Grievance Mechanism is in place, all employees are aware of the Code of Conduct which is integral part of the Employment Agreement. (b) Workers Organization: Please provide a summary of whether the Company complied with national law in allowing workers to form and join worker’s organizations without retaliation or discrimination. Please provide a summary of worker’s organizations with numbers in member workers relative to total employees. Name(s) of the workers' organization(s): To date no organizations have been sought out by workers even though Labor Code of Georgia allows to do so. (c) Retrenchment: Civil Contractor AGE largely demobilized in the reporting period. As of December 2020, 27 workers were retained, 4 Turkish and 23 Georgians, out of this - 19 males and 4 females. Demobilization process went according to the agreed plan. All workers received timely notifications about the retrenchment. 10
(d) Grievance Mechanism: Employee Grievance Mechanism is in place, grievance boxes are installed in Batumi Office and Shuakhevi powerhouse, grievance forms in English and Georgian have been shared with all employees. Only one grievance was registered in the grievance log of employees which was related to the food quality at the canteen. AGL HR and Admin Manager together with the Shuakhevi Admin Manager immediately undertook survey of employees, conducted a meeting with the canteen owner and delivered employees’ concern. A follow-up survey with employees showed that the quality was significantly improved at the canteen. (e) Child Labor / Forced Labor: AGL’s legal teams review contracts against Georgian law which is aligned with the eight basic International Labour Organization conventions) and has not identified any instances of Children under 18 years being employed by the Project. (f) Occupational Health and Safety (OHS): The Company employed an average of 74 people between July-December 2020 more than 90% were Georgian Nationals. This figure includes all office and support personnel based at the camp areas and Batumi Offices, as well as workers hired by AGL for a short time repair works. From July to December 2020, 3 Near Miss incidents were recorded. All the events are low potential occurrences. No any Lost ime Incident L I’s was recorded only hree Near Misses were recorded during this period. On the EM front the focus remains on work around energized equipment. Lock out tag out procedures are closely monitored as well as permit to work authorization so that relevant persons are aware of the nature of work undertaken in respective areas and the work parties involved in execution. Table 1 Occupational Health and Safety Performance (Construction Phase) during this semi-annual period Number Item Target Employees Contractors Total – H2 2020 A: Fatalities: 0 0 0 B: Total Lost Time Accidents 0 0 0 (including vehicular): C: Total number of lost workdays 0 0 0 resulting from incidents. D: Total man-hours worked this 85320 5849 91169 reporting period: E: Incidence during this reporting 0 0 0 period: (Note: Incidence = total lost workdays / total hours worked) 11
F: Lost Time Injury Frequency Rate 0 0 0 (Number of lost time accidents x 1,000,000 hours / total man-hours worked = injuries per million hours worked) G: Lost Time Severity Rate (Total 0 0 0 7.5 or less Lost workdays x 1,000,000 (construction phase) hours / total man-hours worked = lost workdays per million hours worked) Table 2 Improvement Trend of Occupational Health and Safety Performance Item 2014 2015 2016 2017 2018 2019 2020 A: Fatalities: 0 2 0 0 0 0 0 [Employers] [Contractors] [Total] B: Total Lost Time Accidents (including 14 7 14 6 3 6 0 vehicular): [Employees] [Contractors] [Total] C: Total number of lost workdays resulting 69 694 38 45 131 170 0 from incidents: [Employees] [Contractors] [Total] D: Total man-hours worked this reporting 2,367,795 4,045,801 5,079,279 1,952,527 1,229,807 2,123,028 411909 period: [Employees][Contractors] [Total] E: Incidence during this reporting period: 0 0.006 0.00000784 0,000016 0.0001065 0.00008007 0 2 F: Lost Time Frequency Rate (employers) 5.91 1.73 2.76 2.58 2.4 2,82 0 (Contractors) (Total) G: Lost Time Severity rate (employees) 29.14 171.53 7.48 23.04 106.5 80,07 0 (Contractors) (Total) (g) Workers Engaged by Third Parties: Please provide a summary of how the Company is managing and monitoring the performance of third party employees in relation to the requirements of the PSs / PRs. Third parties such as subcontractors and consultants are subjected to weekly and monthly monitoring checks by AGL management. Records, such as inspections and audit are maintained at respective offices. 7.3 PS3/PR3/SR1 – Resource Efficiency and Pollution Prevention: (a) Resource Efficiency – Greenhouse Gas (GHG) emissions avoidance: Please provide the Company’s estimate about the GHG emissions avoidance effect of the Project: GHG emissions avoidance of the Project: Project was in the transition phase from Construction Phase to Operations phase during the reporting period. 12
Table 3 Year Gross electricity Auxiliary electricity Net electricity Grid emission GHG emissions generation (MWh / consumption (MWh / generation (MWh / factor (tonCO2 / avoidance year) year) year) MWh) (tonCO2 / year) A B C=A–B D E=CxD PDD for CDM Actual 2018 0 2,892,522 -2,892,522 0,396 -1,145,438.7 2019 Jan-June 0 2,949,898 -2,949,898 0,396 -1,168,159.6 2019 Jul-Dec 0 2020 Jan-Jun 228800 1634 227166 0.396 89957.73 2020 Jul-Dec 29680 1650 28030 0.396 11,099.88 Table 4 Estimated CO2 Emissions from Mobile Sources (Gasoline Vehicles) Total Total length of Gasoline consumed Gasoline CO2 emissions CO2 emissions number distance vehicle factor (tonCO2) of travelled (km) (litre) (TJ - LHV) efficiency (litre (kgCO2/TJ- vehicles / km) LHV) A B C D=B/A D=69300 E=BxD/1000 2014 2 400 30 69300 0,00225 0,075 2015 3 532 105 0,080 70850 0,00386 2016 3 86800 8680 0,1 69300 0,868 2017 3 54,000 5,400 0,1 69300 0,54 2018 5 11287 1710 0,15 69300 0,256 Jan-Jun 2018 5 24548 3080 0,12 69300 0,386 July-Dec 2019 Jan-Jun 5 29214 4090 0,14 69300 0,572 Jul-Dec 2019 5 22516 3782 0,17 69300 0,672 Jan - Jun 5 9216 0,16 69300 0,242 2020 Jul-Dec 8 44937 7762.94 0.173 69300 1.34 2020 Note: CO2 emissions factor (gasoline) 69300 kgCO2/TJ-LHV from 2006 IPCC Guidelines. Table 5 Estimated CO2 Emissions from Mobile Sources (Diesel Vehicles) CO2 emissions Total Total length of Diesel consumed Diesel vehicle factor CO2 emissions number of distance efficiency (litre (TJ - (kgCO2/TJ- (tonCO2) vehicles travelled (km) (litre) / km) LHV) LHV) A B C D=B/A D=74100 E=BxD/1000 2014 292 400 30 0,075 69300 0,00225 2015 294 1153988 873852 0,7572 74100 661,68 2016 340 6868600 4120187 0,6 74100 2472,1 2017 170 3778740 2553531 0,675 74100 1725,5ი 8 2018 Jan-Jun 152 782365 560000 0,715 74100 400 2018 71 477502 73227 0,153 74100 11,20 13
July-Dec 2019 Jan-Jun 153 2108188 1530540 0,725 74100 1109 Jul-Dec 2019 148 2052246 1416036 0,689 74100 975 Jan-Jun 2020 126 1747156 301970 0,17 74100 51,33 June-Dec 2020 8 5009 5444.1 0.109 74100 0.592669669 Note: C02 emissions factor (diesel 011) 74100 kgC02IT J-LHV from 2006 IPCC Guidelines. Pollution Prevention - Waste: Please provide a summary of non-hazardous and hazardous waste generation and minimization activities using the table below. Please add a summary description of major recycling activities conducted. Table 6 Non-hazardous and Hazardous Waste Minimization Activities Item Non-hazardous waste Hazardous waste Generated Re- Disposed Recycling Generated Re- Disposed Recycling (ton) cycled (ton) ratio (%) (ton) cycled (ton) ratio (%) (ton) (ton) A B C=A-B D=B/A E F G=E-F H=F/E 2014 285 - 285 0% 13,71 13,71 - 100% June - Dec 2015 236,4 - 236,4 0% 27,30 27,30 - 100% Jan- June 2015 91,35 - 91,35 0% 20,94 20,94 - 100% July - Dec 2016 Jan – 374,06 - 374,06 0% 53,55 53,55 - 100% June 352,8 - 352,8 0% 62,8 62,8 - 100% 2016 July - Dec 279,6 - 279,6 0% 10,5 10,5 - 100% 2017 Jan – June 395,1 - 395,1 0% 10,5 10,5 - 100% 2017 Jul - Dec 2018 306,8 - 306,8 0% 7,4 7,4 - 100% Jan-Jun 2018 July-Dec 306,8 - 306,8 0% 2,2 2,2 - 100% 2019 553,52 - 553,52 0% 9,6 9,6 - 100% Jan-Jun 14
2019 586,6 - 586,6 0% 15,7 15,7 - 100% Jul-Dec 2020 486,65 - 486,65 0% 0,9 0,9 - 100% Jan - Jun 2020 150,45 150,45 0% 0,2 0,2 100% Jul - Dec Please add a summary description of major recycling activities conducted. During reporting period, there has been a significant decrease in the amount of domestic and hazardous waste. Domestic waste is collected form Powerhouse and Kichauri camp area by the municipality tracks. Wastes are segregated based on type such as hazardous and non-hazardous waste. During construction phase, AGL was ensuring transportation of hazardous waste by special contractor to designated landfill in Batumi. For operational phase, as domestic waste has been reduced, local municipalities are arranging transportation of waste from project areas. As for Hazardous waste they are stored in special area, arranged as per requirement of Georgian legislation and international practice. Contract has been concluded with licensed company “SANI ARY” who is responsible for transportation and further treatment of hazardous waste. Quantity of hazardous waste handed to contractor for recycling also information on transportation is reported by AGL to the MEPA through official website. 7.4 PS4/PR4/SR1 – Community Health, Safety, and Security (a) Implementation of key actions for community health and safety (dam safety): AGL conducted safety information sessions prior to the commissioning of the 35kV OTL. Despite the fact that operations of the 35kV OTL was covered during the Shuakhevi powerplant safety briefing with communities in 2019-2020, AGL considered important to remind again about the risks and precautionary measures to be undertaken by general public. As the commissioning coincided with the lockdown in the country, virtual briefings were conducted with the villages heads and representatives of Furtio, Nigazeuli, Nenia, Shuakevi (town), Okropilauri, dabadzveli as well as in Khulo: Kinchauri, Tsablana, Tsabliani. (b) Implementation of key actions for security personnel management: Please provide a summary of the planned key mitigation measures of the security staff about appropriate use of force where applicable toward workers and affected Communities. During this reporting period, no use of force was needed, and no situations arose that required the use of security personnel attention. The security staff has direct supervision on site and are aware of their responsibilities through induction and refresher on the Security Code of Conduct Policy by the state Police. 15
(c) Implementation of key actions to other incidents. Please provide summary of incidents recorded including date, scale of damage and injury, if any; authorities in charge of investigation / recording and media or community reactions, if any; action taken to respond to the incident; and any outstanding issues and proposed measures. Please provide any other health and safety events or out-reach activities including incidents that have caused damage to the environment or to human health, and/or attracted attention of outside parties (e.g., fire, explosion, chemical or oil spill, and pollution release). No incidents occurred during the reporting period Training sessions for Emergency Preparedness were conducted and it will continue in the future. During the reporting period COVID-19 pandemic was a major health issue. All the necessary precautions were taken All the staff was sensitized about do’s and don’ts regarding C VID-19. Rules and regulations were followed as laid down by GoG. 7.5 PS5/PR5/SPS – Land Acquisition and Involuntary Resettlement: (a) Land Acquisition. Livelihood Restoration: Please provide a summary of the land acquisition and livelihood restoration, including implementation of the Land Acquisition and Livelihood Restoration Plan. Identify any gaps and the corresponding measures/corrective actions undertaken by the Company. Due to difficult geological landscape and unsuitable terrains for erecting towers, there were slight changes in the approved route of the 35kV OTL and towers were shifted, this resulted in affecting new land plots under the ROW. The scale of the impact is not significant. AGL is elaborating data on the change which will be reflected in the Land Acquisition and Completion Audit. AGL has resolved complaints received from locals whose land plots were affected by erection of towers and line stringing. Expert 21 undertook valuation and assessment of some land plots, however due to pandemic situation the valuation will continue once restrictions are lifted. AGL fulfilled its obligations under the Addendum to the LALRP and in December delivered walnut saplings (343) to 12 HHs who lost fruit bearing trees due to the project activities, as for agricultural pesticides it will be delivered in H1 2021. HHs and village head were notified about the revised timescale. AGL finalized ToR for the Completion Audit and received no-objection from lenders. Audit proposals were submitted by 2 constants, AGL planned to start the audit in October 2020, however due to pandemic it was delayed and is planned to start in April-May 2021. (b) Please provide a summary of PS5/PR5/SPS related stakeholder engagement and outcomes. NMG erected several towers on non-compensated land. AGL learnt about this through the grievance mechanism when some landowners/users submitted complaints requesting the land compensation. AGL conducted site visits as well as undertook number of phone calls with complainants to study the issue. The company will issue the document reflecting all changes in the project with respective timeline for paying compensation. AGL has compensated all landowners affected by the original design, however due to route changes some received compensation but had not lost any land, and some did not receive compensation, though the land had been affected. AGL will commission land officer and a valuator, Expert 21 to investigate such changes and based on the data studied intends to compensate all HHs affected by such changes. As the majority of compensations have already been paid and HHs had already been covered under the socio-economic survey, AGL will prepare Land Acquisition and Completion Report. The report is expected to be ready in H2 of 2021. 16
7.6 PS6/PR5/SR1 – Biodiversity Conservation and Sustainable Management of Living Natural Resources Biodiversity Monitoring Surveys and monitoring required by the Biodiversity Action Plan (BAP) continues to be implemented, monitoring results are shared with MEPA in accordance to the permit condition once in 6 months. Last monitoring report was submitted in January 2021 and found satisfactory by the MEPA. The following biodiversity monitoring activities have been undertaken: - Fish monitoring on 15 locations in June and August 2020. - Forest Restoration Monitoring - September 2020; - River Macroinvertebrates- August and November 2020. - Large mammals- August, October and December. - Fish pass monitoring -14-19 October 2020. Reports were shared with ERM for further review and comments if any. Compensatory Tree Planting With support of lenders consultant local botanists and ERM “No Net Loss” table was developed which shows the type of habitat, area affected/lost, no net commitment of the project and implementation status. According to the table around 30 ha is required to be planted to meet No Net loss requirement. This figure includes impact of 35 kV OTL project as well. In October 2021 around 8 ha area were planted in Nigazeuli, Shuakhevi municipality, 2 km away from the project impacted area. The land is owned by the State and AGL has obtained no objection letter before planting trees. Around 8 000 local species were planted in this area, dominated with oak. AGL forest officer and botanist undertake regular visits to oversee the condition of the trees. Totally for the reporting period 17.82 ha area is planted by AGL. The remaining 9, 5 ha will be planted by LLP Wildlife Agency of the Ministry of Environmental Protection and Agriculture in Spring 2021. According to contract between AGL and LLP Wildlife Agency (dated March 2020), tree planting should have been carried out in September 2020, however due to COVID-19 restrictions it was postponed to Spring 2021. As for the rest 2.65 ha land plot which is pending to plant to achieve no net loss, AGL has identified 3 ha area in the Village Kidzinidzeebi, Shuakhevi municipality. AGL will apply to the National Property Agency which is the owner of land plot to obtain no objection letter. Meanwhile, consultations were conducted with locals who are willing to have walnut plantation in this area. Tree plantation maintenance activities are regularly conducted by AGL in all 5 areas (villages Tsablana, Nigazeuli, Jabnidzeebi, Iakobidzeebi and SDA 4). AGL forestry officer and botanist oversee this activity. Local villagers are also hired to protect tree planting areas from cattle and damages from the third parties. Fish stocking obligation Fish stocking activity is ongoing as per the approved plan. In March 2020 a contract was concluded with the fish farm and the permit “to catch and remove” trout for the hatchery was obtained from the MEPA. Fish catching activity was conducted in two stages in June and August 2020. As per fish 17
stoking plan 180 reproductive trout was caught and transported to the hatchery. AGL has already reported on the progress to the MEPA as required. Fish stocking will be done in March 2021. Operational Biodiversity Action Plan Operational Biodiversity Action (OBAP) Plan was developed by ERM. Information on Statistical Trend Analysis of 2013-2019 was incorporated. AGL has received next round of comments from lenders team, ERM has addressed comments and shared with ARUP. Statistical Trend Analysis Report ERM has carried out the Statistical Trend Analysis of construction phase biodiversity monitoring data for birds, fish, endemic plants, herpetofauna, invertebrates, large mammals, macro- invertebrates and small mammals of the period 2013-2019. The followings were the objectives of the study: • Review of all the reports submitted by NGO and check for any deviations in the year, locations and frequency of sampling • Carry out initial trend analysis across all sampling locations across the years • Undertake a separate analysis for control sites and impacted site and compare any trends between the control and impacted sites • Use the trend analysis to assess residual impacts, at the end of the construction phase and suggest additional mitigation actions to address any residual impacts. Based on the results there is no significant impact on biodiversity species. Though decline trend has been noticed regarding the fish species and bird’s species. The report does not attribute the decline to the project. However, the continuiation of the monitoring and minor mitigation measures have been suggested. Impact was identified regarding floral critical habitat trigger species dwarf comfrey, which was lost on the small area in Chirukhistqali. To achieve no net loss, AGL will re-plant 0.09 ha area in September 2021 on Chirukhistqali camp area. In summer 2021 seeds of dwarf comfrey will be gathered by the botanist. Monitoring data suggest that the Project has not had a measurable adverse impact on the abundance of the faunal critical habitat trigger species Caucasian salamander and that no mitigation or compensation is required. Also, analysis indicates that the Project had not resulted in a decline in otter activity. Though, ongoing monitoring is proposed and considered in accordance with good international practice Ecological flow management: AGL discloses the e-flow monitoring reports on a monthly basis on AGL website. Besides, AGL continued hydrological monitoring through gauging stations downstream of dams. Information from gauging station on water discharge and ecological flow are submitted to the MEPA on a quarterly basis. AGL is looking for the options to install real-time e-flow monitoring camera. Monitoring cameras were purchased and are in the process installation. Restoration of SDAs and Camp areas All SDAs are closed, and recultivation has been completed by AGE. Only Khichauri and Didachara camp site recultivation is postponed for September 2021. 18
Table 1 Tentative timetable for SDA restoration activities Location / Permitted Current Volume Status Planned time Planned time SDA N Storage Used (m³) (See drop downs) frame for frame for Volume completing re- completion and (m³) cultivation hand over to AGL from AGE 1A - Chirukhi 145,000 135,500 Closed and re- April -2019 Completed engineered 3 - Didachara 123,000 122,000 Closed May – 2019 Completed 3A - Diakonidze 63,500 39,700 Closed May-2020 Completed 4 - Vashlovani 342,500 340,500 Closed. Sept - 2020 Completed 4A Zamleti 17,250 15,540 Closed, replanted Sep-17 Completed and handed over. 5 88,750 89,000 Closed. Oct 2020 Completed 6 240,000 213,500 Closed and re- March – 2019 –Competed engineered 7 51,000 50,300 Closed July – 2019 Completed 7A 172,300 170,500 Closed May – 2019 Completed 23 210,000 72,000 Closed May-19 Completed Camp & Closed July 2019 Completed Batching Plant – Chirukhi Camp Site – Closed Spring 2021 Completed Skhalta Camp Site – Closed Spring 2021 Sep 2021 Didachara Storage Site – Closed May-2020 Completed and Akhaldaba handed to state Camp Site – Still in use Spring - 2021 Nov- 2021 Khichauri 19
Table 8: Implementation of Corrective Action Plan 2019 Objectives of Action plan Activities conducted/implemented Status Objective 1. Sustained improvement in Workshop was convened by ERM on the 23rd and 24th of April, 2019 to ERM confirmed that the quality of biodiversity monitoring address Objectives 1 and 2. The following participants attended the quality of reports is reports through the delivery of training by workshop: improved and reached an experienced biodiversity specialist, Nino Gagua-Environment Compliance Manager of AGL, Dr. Arun the acceptable continued round the year review of Venkataraman-Technical Director, Biodiversity (ERM) and standard monitoring reports and clear Biodiversity Consultants: communication of project standards on 1. Dr. .Jimsher Mamuchadze, PSOVI, Birds, herpetofauna, large and Closed biodiversity reporting including actions small mammals; taken if suggested improvements are not 2. Dr. Rezo Goradze, Black Sea Monitoring Department of the realized. Environmental Agency, Macroinvertebrates; 3. Dr. Zurab Manvelidze. Mta Bari; Monitoring of restoration plots and invasive species; 4. Dr. Archil Guchmanidze, NEKTON consulting, Fish. Details of workshop has been provided to ARUP – ERM CAP workshop report (April 2019). Objective 2. Defining and integrating Closed into existing or new contracts, ERM has reviewed sample contracts AGL used to have for environmental responsibilities for undertaking statistical NGOs involved in biodiversity monitoring. As was observed Ccontracts analysis for monitoring data, assigning were focussing on legal obligations of the consultant, ERM responsibilities where possible and recommended to strengthen the with Annex 1 which include information: designing and implementation of adaptive management measures noting • A terms of reference indicating locations of sampling, timing and when this is not possible a precautionary frequency per year along with details on the methodology. approach will be followed. • A clause indicating that as a consequence of the trend analysis, the consultant may be required to provide suggestions for adaptive management and should do so in a timely manner. Objective 3. Identifying and contracting ERM was appointed to provide yearly biodiversity reports to Lenders. I Closed. an independent biodiversity specialist to First yearly report of operational phase will be provided to Lenders Feb p r o g ress report to annually to the lenders 2021 20
7.7PR10 P DB’ P b P y 2011 – Stakeholder Engagement (a) Implementation status of key actions: AGL follows operations phase SEP for the Shuakhevi power project and SEP for the 35 kV OTL. For the reporting period: • Shuakhevi powerhouse serves as the PIC for the operations. Didachara camp has been closed down and CLO from Khulo moved to the Shuakhevi powerhouse office. Khichauri camp is still operational only for catering and dormitory and does not serve as PIC for AGL. AGE social staffing has reduced significantly, and the company did not retain their CLO. • AGL engaged with APs of the 35kV OTL. Meetings were conducted with the purpose to resolve outstanding complaints related to impact on land acquired for the transmission line and towers; • Grievances are being registered in the log and Stakeholder Engagement Register is being updated accordingly. For the reporting period 38 visitors visited the Shuakhevi power plant PIC. Due to COVID-19 the preferred communication tool for locals turned out to be phone. Media coverage AGL has developed Communication and PR Strategy. The document focuses on activities improving AGL’s image in a wider public. AGL has developed partnership with several local and central media outlets and a significant good progress was made in shaping AGL’s reputation in public. Media coverage statistics is presented in the below chart: Over the past six months, AGL has maintained current trend. According to the media report, prepared by independent media resarch company IPM, media covarage about ShuakheviHPP was mostly neutral and positive. Key issues were particularly highly covered in media: • Personal stories of the locals, whose lives were changed for the better by Shuakhevi HPP. (10 personal sories are plannded in the cycle in media this year). • The news about appointment of new CEO of AGL was higly covered in the Georgian media. • How AGL handled the challenges associated with COVID-19. • Shuakhevi HPP - successful project in the energy sector in 2020. (It increased the electricity generated by seasonal hydropower plants in Georgia by 8% compared to the last year.) AGL communication activities are carried out in accordance with the company's communication strategy and media plan, where changes are made in compliance with current trends in the energy sector and existing challenges. 150 In Total - 88 100 50 0 Positive – 17, Negative – 1. Neutral – 70, Critical - 0 21
(b) Information Disclosure: AGL continues updating information on the Company’s website and tracks the statistics as recommended by the Lenders. For the reporting period: - There have been 9,589 unique visitors and 38,337 visits. The other tool for information disclosure is through article published on a monthly basis by partner media outlets, as well as TV interviews, video clips, social media pages on Instagram and LinkedIn. (c) Public Grievance Mechanism: AGL continues grievance registering and monitoring grievance resolution in a systematic way. Completion of construction activities led to a significant decrease of complaints. For the reporting period AGL registered the following grievances and requests from the local communities. Table 9: Grievances and actions taken by AGL Grievance category Date of the Closure of Description Actions taken complaint complaints received Geology, land July 22, 2020 August 2 The resident of Didachara village Even though the link between the erosion intermediate claimed that tunneling works activated project works and the actual condition response. erosion processes on his land plot of the complainant’s land plot has not October 30, located near the Didachara dam and been established AGL expressed 2020 requested the Company to include him readiness to support the complainant into the social projects. and provided walnut saplings as requested by the complainant within the CSR framework. Noise disturbance July 23, 2020 In progress A resident from Gurta, living upstream AGL social team together with the the Didachara dam, near the riverbed safety manager visited the area and of Adjaristsqali river complained about checked the noise volume at day and the noise disturbance from the nighttime as well. It was difficult to Skhalta-Didachara outlet tunnel. He measure only outlet tunnel noise, as it said that water falling from the outlet to was high flood season and there were the reservoir creates noise in the area noises coming from the river itself, as and makes it impossible to stay in the well as a creek coming adjacent to the area. house. However, to address this grievance competently, AGL will engage skilled and knowledgeable specialists who can provide noise measuring services and produce relevant reports. Results of the noise survey will be shared once prepared. Geology July 23, 2020 August 2, A complainant from Didachara AGL checked the area and confirmed 2020 complained that a mass of land that the area affected by the land slip collapsed near the Didachara belonged to the Company. The reservoir and requested complainant has been notified about compensation for the land slip. the decision. Geology, house July 29, 2020 July 29, 2020 A resident from Gurta complained that AGL has informed him that joint damage during blasting activities his house inspection formed by AGL, local located above the tunnel alignment in consultant and Khulo Municipality did Gurta was damaged and requested not find any connections linked to the the company to provide damage and construction activities, compensation. He also mentioned that however he received compensation he filed a complaint against AGL to from the municipality for the repair 22
IFC and was waiting for their works of his house. AGL declined to response. provide financial assistance. Road arrangement August 20, September Residents of Nigazeuli complained AGL has an obligation to rehabilitate on SDA 3a 2020 17, 2020 that some households failed to access and recultivate SDAs as per the mowing land plots located down the projects agreed and approved by the riverbed. A letter of request was also Ministry of Environment of Georgia. received from the Shuakhevi mayor Even though the SDA area is owned by asking assistance for the arrangement AGL, the Company arranged a footpath of motor road on SDA. on it to allow locals reach the mowing area. AGL communicated to the complainants and the Mayor’s office that the Company is ready to support locals request in case the municipality applies to the MoE and receives approval from the Ministry of the road arrangement. The response from the Mayor’s office is still pending. 35kV OTL – land August 6 and August 15 – Landowners complained about the AGL is going to study all such situations compensation 13, 2020 20, 2020 erection of towers and stringing the in the project and compensate all complaints line without being compensated for the whose land plots were taken for the land taken for the Project. project. Water pipe damage October 22, October 30, While cutting trees in Skhalta valley, a AGL has informed NMG about the 2020 2020 water pipes were damaged in Cheri complaint. NMG provided monetary village. compensation to fix the problem. Locals confirmed the complaint as closed. Makhalakidzeebi Community Complaint On July 2020 AGL and Makhalakidzeebi community met for a final joint meeting, facilitated by CAO and PMC via video conferencing due to travel restrictions related to COVID-19, the parties discussed the possibilities of continuing engagement. AGL presented once again support the Company is ready to extend to the villagers within its CSR framework, however, the villagers did not accept the partnership opportunity proposed by AGL and parties failed to reach a common agreement. The parties expressed willingness to continue dialogue beyond the CAP and PMC facilitation. Regarding the status of the court cases mentioned in previous reports, no updates have been registered. (d) Corporate sustainability activities: AGL developed a 3-year CSR strategy along with budget which was submitted to the Board of Directors for approval in February. The Strategy envisions continue implementation of social projects focusing on same areas, such as education, small business support programs and developing infrastructural projects together with local municipalities. During tunnel rehabilitation phase AGL signed MOUs with Chanchkhalo and Kinchauri villages on implementation of SME support and educational programs. For the reporting period, AGL financed 9 business cases in Chanchkhalo and 4 business in Kinchauri villages. The business ideas vary from agriculture to arrangement of guest houses and small cafes. Apart from it, AGL also provided monthly scholarships to 4 students from Kinchauri village. 23
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