Maldives: Solar Power Development and Energy Storage Solution

OBJECTIVE

To increase generation capacity from renewable energy sources and to facilitate the integration of renewable energy into Maldives’ grid infrastructure.

DESCRIPTION

The Project involves the development of 36 MW solar power project and 50 MWh of battery energy storage solutions across various selected islands in the Maldives. The Project also involves grid modernization for the integration of variable renewable energy with the grid, which will be financed under the proposed AIIB loan. The Project comprises of the following components:  

Component 1. Solar PV Risk Mitigation 

Component 2. Battery Energy Storage System (BESS) 

Component 3. Grid Modernization for Variable Renewable Energy (VRE) Integration 

Component 4. Technical Assistance  �

The AIIB loan will finance activities under Component 3. The Project is co-financed with the World Bank (WB) and Clean Technology Fund (CTF).

ENVIRONMENTAL AND SOCIAL INFORMATION

The project will be cofinanced with the WB as lead cofinancier, and the project’s environmental and social (ES) risks and impacts have been assessed in accordance with the WB’s Environmental and Social Framework (ESF). To ensure a harmonized approach to addressing the ES risks and impacts of the project, and as permitted under AIIB’s Environmental and Social Policy (ESP), the WB’s ESF will apply to the project in lieu of AIIB’s ESP. AIIB has reviewed the WB’s ESF and is satisfied that: (i) it is consistent with AIIB’s Articles of Agreement and materially consistent with the provisions of AIIB’s ESP, including the relevant ES Standards; and (ii) the monitoring procedures that are in place are appropriate for the project. The WB has categorized the ES risks of the project as Moderate, which is equivalent to Category B if AIIB’s ESP were applicable. An ES Management Framework (ESMF), accompanied by an ES Commitment Plan, a Stakeholder Engagement Plan (SEP), Labor Management Procedure, and Gender Action Plan have been prepared to meet the requirements of the WB ESF and have been disclosed on the WB website and the website of the Borrower. Links to these documents will be included on the AIIB site. For Components 2 and 3, an ES Impact Assessment and an ES Management Plan will be prepared and similarly disclosed. A three-tier Grievance Redress Mechanism (GRM) is included in the SEP and referenced in the ESMF. 

Project activities are not expected to result in involuntary resettlement as land/space needed will either involve existing government property or will be procured through lease agreements. The WB’s assessment finds that there is no evidence suggesting the presence of Indigenous Peoples in the Maldives, therefore the project will not have an impact on Indigenous Peoples.  

Environmental risks associated with the solar energy generation system investments include future decommissioning of the solar energy systems at the end of their lifetime, and the grid upgrade works. However, these are expected to be localized in nature and arise only during construction with localized impacts such as dust/noise pollution and waste generation, as well as issues related to worker health and safety. There is also the need to manage any toxic wastes from the use of batteries during the operational stage of the project.