investments in Hydropower Development Luxembourg, 11 June 2018 - - PowerPoint PPT Presentation

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investments in Hydropower Development Luxembourg, 11 June 2018 - - PowerPoint PPT Presentation

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EIBs Draft Environmental, Climate and Social Guideline for investments in Hydropower Development Luxembourg, 11 June 2018 Introduction to the Stakeholder Engagement Workshop Monica Scatasta, Head of Environmental, Climate and Social Policy,

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SLIDE 1

EIB’s Draft Environmental, Climate and Social Guideline for investments in Hydropower Development

Luxembourg, 11 June 2018

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SLIDE 2

Introduction to the Stakeholder Engagement Workshop

Monica Scatasta, Head of Environmental, Climate and Social Policy, EIB

European Investment Bank Group 2

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SLIDE 3

Objectives of Today’s Workshop

  • Focus on the Guideline document

and listen to your feedback To this end we will first:

  • Outline the rationale and process
  • f development of the guidelines
  • Discuss the criteria and objectives
  • Highlight key new elements in

EIB’s approach to hydropower

  • Listen to your feedback

European Investment Bank Group 3

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SLIDE 4

The EIB: the EU bank

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  • Shareholders: 28 EU

Member States

  • Natural financing

partner for the EU institutions since 1958

  • Around 90% of

lending is within the EU

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SLIDE 5

The EIB at a glance

  • Largest multilateral lender and borrower :
  • We raise our funds on the international capital markets
  • We pass on favourable borrowing conditions to clients
  • Some 450 projects each year in over 160 countries
  • Headquartered in Luxembourg with 40 local offices
  • Around 3,200 staff:
  • Not only finance professionals, but also engineers, sector

economists and socio-environmental experts

  • 60 years of experience in financing projects

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SLIDE 6

EIB’s lending to Hydropower

  • Hydropower projects part of the

renewable energy portfolio financed by the EIB, in line with the Bank’s Energy Lending Criteria

  • Co-financed 92 hydro project
  • perations since 2007
  • Over € 8.9bln loans since 1984 to

197 projects in 60 countries

European Investment Bank Group 6 322.5 3083 70 89 198.8 121.5 785.24 512.5 383.7

Lending volume 2007-17 EUR 5.56 bn

Russia, E.Europe,Sth. Caucasus Member states EFTA Potential candidate countries Candidate countries Mediterranean countries Latin America Asia (excl. Central Asia) ACP States

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SLIDE 7

The Guideline’s Rationale

  • Hydropower is largest source of renewable power worldwide:
  • Significant benefits if implemented sustainably
  • But potentially major and complex negative impacts
  • The Guideline sets out:
  • EIB’s clear position on:
  • Compliance with EU policies and alignment with their principles
  • Definition of EIB expectations regarding project promoters’ responsibilities
  • EIB’s ambition regarding hydropower sustainability, building on best

practice in the EU

  • A “toolkit” for EIB staff → quality and consistency of the analysis

European Investment Bank Group 7

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SLIDE 8

EIB’s project cycle

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EIB project cycle

Step 1 Proposal Step 2 Appraisal Step 3 Approval Step 4 Signature Step 5 Disbursement Step 6 Monitoring and reporting Step 7 Repayment

  • Financial
  • Economic
  • Social
  • Environmental
  • Technical

assessment

  • EIB Management

Committee

  • Investment

Committee (for operations potentially benefiting from EU guarantee under EFSI)

  • EIB Board of

Directors Finance contract is signed Conditions for disbursement are checked

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SLIDE 9

EIB’s E&S Framework

  • EIB Statement on Environmental and

Social Principles and Standards

  • EIB Environmental and Social

Standards

  • Internal procedures for their
  • perationalization
  • Set of sector/issue specific guidance

materia - “Environmental, Climate and Social Guideline for investments in Hydropower Development” is part

  • f this evolving set

European Investment Bank Group 9

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SLIDE 10

Structure workshop

  • Session 1 : Guideline Rationale and Process (1h)
  • Session 2 : Guideline content and specific aspects

that are new in EIB’s approach (1.5h)

  • Wrap up : “What we heard” and Next Steps (15m)
  • Rules of engagement:
  • Focus on the Guideline document
  • State who you are
  • Short statements/questions so all can participate
  • Follow up in writing

European Investment Bank Group 10

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SLIDE 11

Thank you! Any Questions?

European Investment Bank Group 11

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SLIDE 12

Development of the Guideline

Bartholomew Judd, Environmental Specialist, EIB

European Investment Bank Group 12

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SLIDE 13

Objectives of the Guideline

  • Provide direction to Bank

staff, project promoters, government agencies and civil society on EIB’s approach to appraising and monitoring future hydropower projects.

  • Highlight areas of good

practice and potential

  • pportunities and risks

related to hydropower projects.

European Investment Bank Group 13

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SLIDE 14

Approach of the Guideline

  • Focus on Risks and Opportunities in hydropower with

the goal of identifying and disseminating best practice.

  • Defines approaches for any type of Hydropower Project.
  • Defines approaches for all EIB financial services,

including on-lending to financial intermediaries.

  • Hydropower-specific requirements and

recommendations:

  • Within framework of EU legislation and EIB Standards .
  • How and when to comply versus alignment.

European Investment Bank Group 14

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SLIDE 15

Development of the Guideline

  • Competitive tender

contract awarded to ERM Q4 2016.

  • Targeted consultation:
  • Understand expectations

and opinions.

  • Gather knowledge and

experience.

  • Identify issues.
  • Policy context.
  • Stakeholder’s views on

implementation.

European Investment Bank Group 15

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SLIDE 16

Consultation – External Stakeholders included:

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  • EC: DG ENV; DG DEVCO; DG CLIMA; DG ENER
  • IFIs: World Bank; Inter-American Development Bank;

Asian Development Bank; European Bank for Reconstruction and Development; AFD; KfW;

  • Promoters: EDF; eleQtra;
  • NGOs/Civil Society: The Nature Conservancy; WWF;

BankWatch

  • Other: International Hydropower Association;

International Institute for Environment and Development;

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SLIDE 17

Overall Benefits of the Guideline

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  • Clear, concise statement of EIB’s commitment to renewable

energy, and development of sustainable hydropower - to set expectation

  • Emphasis on compliance with EU legislation and EIB

Standards

  • Clearly defined requirements for project promoters that EIB

will consider when approaching future hydropower projects

  • Description of how EIB will work with promoters and other

stakeholders during appraisal and monitoring of hydropower investments

  • Collection of best practices and key references on approaches

and methods, and discussion of how/when to apply

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SLIDE 18

Thank you! Any Questions?

European Investment Bank Group 18

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SLIDE 19

Structure and Criteria of the Guideline

Dr Eamonn Barrett

Project Team Leader, ERM Ltd

European Investment Bank Group 19

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SLIDE 20

Structure of the Guideline

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  • Introduction, including:
  • Applicability.
  • Policy Environment.
  • Technical Issues and

Impacts (see later slide).

  • Monitoring Requirements.
  • Key References.
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SLIDE 21

Environmental Issues and Impacts

  • Natural Habitat and Biodiversity Degradation and Loss.
  • Downstream Hydrology and Limnology (including

Environmental Flows).

  • Reservoir Water Quality and Sedimentation, including

Eutrophication.

European Investment Bank Group 21

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SLIDE 22

Social Issues and Impacts

European Investment Bank Group 22

  • Physical and Economic

Displacement and Loss

  • f Access.
  • Cultural Heritage.
  • Public Health, Safety and

Security.

  • Ecosystem Services.
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SLIDE 23

Climate Resilience and GHG Emissions

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  • Factoring Climate

Change into Hydrological Assessment.

  • Assessing Potential

Physical Risks.

  • Calculation of Reservoir

GHG Emissions.

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SLIDE 24

Strategic and Basin-wide Issues

  • Cumulative Basin-Level

Impacts.

  • Potential Transboundary

Impacts.

  • Strong Governance and

Community Support.

European Investment Bank Group 24

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SLIDE 25

Reservoir and Dam Safety

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  • Risks Associated with

Infrastructure Failure.

  • Risks Associated With

Dam Operation.

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SLIDE 26

Monitoring Requirements

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  • Regular reporting by the

promoter on performance

  • f the project’s ESMS.
  • Reporting to regulatory

authorities.

  • Reports on contractor

management.

  • Stakeholder engagement
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SLIDE 27

Layout of the Guideline

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  • 78 requirements & recommendations listed,

across 6 key topics.

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SLIDE 28

Thank you! Any Questions?

European Investment Bank Group 28

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SLIDE 29

Stakeholder Engagement Workshop – Key changes for the EIB

Olivier Tricca, Power Engineer, EIB

European Investment Bank Group 29

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SLIDE 30

EIB engagement baseline

  • Transparent and comprehensive Requirement /

Recommendation process for hydro projects

  • No discrimination based on power plant or dam

size but on reservoir size and Degree of regulation.

  • Priority to economic site restoration over existing

assets rehabilitation over new assets.

  • Stricter rules of EIB engagement for FI operations.

European Investment Bank Group 30

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SLIDE 31

Project development stage

  • Increased awareness of E&S

inputs integration at site selection stage

  • Increased support to WFD

principle application, strategic and system-based studies,

  • utside EU
  • Promote sustainable and

adaptive approach for water assessment (climate change, flood, environmental flow and associated facilities)

European Investment Bank Group 31

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SLIDE 32

Project Implementation stage

  • Higher participation from local community, women

and vulnerable people in monitoring and benefit sharing mechanism

  • Increase support for higher public governance

standards and independent committees review

  • Strong and transparent monitoring system (flow,

gas emissions, sedimentation...)

European Investment Bank Group 32

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SLIDE 33

Thank you! Any Questions?

European Investment Bank Group 33

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SLIDE 34

Next Steps

Bartholomew Judd, Environmental Specialist, EIB

European Investment Bank Group 34

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SLIDE 35

Next Steps

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  • Collate comments from stakeholder engagement

process – July 2018.

  • Review and update final draft based on stakeholder

comments.

  • Publish Final Guideline Q4 2018.
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SLIDE 36

Thank you! Any Questions?

European Investment Bank Group 36