ENVIRONMENTAL AND SOCIAL INFORMATION
Environment and Social Policy, and Categorization. The Project is co-financed with EBRD, and the Project’s Environmental and Social (E&S) risks and impacts have been assessed in accordance with EBRD’s Environmental and Social Policy (EBRD’s ESP 2019) and related Performance Requirements (PRs). To provide for a harmonized approach to addressing the E&S risks and impacts of the project, and as permitted under AIIB’s Environmental and Social Policy (AIIB’s ESP), EBRD’s ESP and relevant PRs will apply to the project in lieu of AIIB’s ESP. AIIB has reviewed the EBRD’s ESP and PRs and is satisfied that: (a) they are consistent with AIIB’s Articles of Agreement and materially consistent with the provisions of AIIB’s ESP, including AIIB’s Environmental and Social Exclusion List (ESEL) and the relevant Environmental and Social Standards (ESSs); and (b) the monitoring procedures that are in place are appropriate for the project. EBRD has categorized the E&S risks of the project as Category B, which is equivalent to Category B if AIIB’s ESP were applicable.
ES Instruments. An Environmental Impact Assessment (EIA) in line with national regulations was prepared and approved and the construction activities commenced in June 2022, with the expected scheduled commissioning in January 2024. EBRD and AIIB have conducted an Environmental and Social Due Diligence (ESDD) including: (i) the review of proposed site settings and associated environmental and social risks as well as any legacy issues, considering cumulative impacts and associated facilities (transmission lines and roads), (ii) biodiversity risk analysis, especially for birds, bats and flora, (iii) overall land acquisition and use for the wind turbines, (iv) the review of the current operations and status of previous ESAP implementation, and (v) a review of the Project's supply chain arrangements, including an external labor audit. Based on the ESDD results, a site specific Environmental and Social Action Plan (ESAP), Non-Technical Summary (NTS), and a Stakeholder Engagement Plan (SEP) were prepared.
Environmental Aspects. The Project is an extension of the Zhanatas Wind Farm, located in Sarysu district of Zhambyl region, south Kazakhstan. Shokpar WPP will add an extra 22 turbines (100 MW) to the same location in the adjacent land plot owned by the shareholders and will utilize much of the same infrastructure including the same Opornaya substation via a 7.6 km 220 kV transmission line. The Project is expected to generate direct and indirect adverse impacts on biodiversity during construction, operation, maintenance, and decommissioning, as manifested through dust emissions, habitat fragmentation, noise, solid waste, wastewater, etc. The major potential impacts include bird and bat collision-related fatalities, noise, and shadow flickering during the operational phase. In addition, the location of the operational turbines may represent a barrier to migratory species. The Project is part of Kazakhstan’s wind energy development that involves other wind power plants in the same region, and it can cause cumulative impacts. Adverse impacts can also result from associated facilities, particularly overhead transmission lines and access roads. Overall environmental impacts associated with the extension of the existing wind power plant are site-specific and readily assessed based on the ESDD and can be mitigated via ESAP implementation and provision of adequate management resources to address identified E&S impacts.
Biodiversity. The ESDD included a biodiversity risk analysis based on EBRD’s PR 6 and, similar to the Zhanatas Wind Farm, the results confirmed that the wind farm is not located in any E&S sensitive areas, and there are no protected or designated nature reserves within a 30 km radius of the Project. The birds’ main migratory pathways are found about 25-30 km north of the Project area. The area's ecological value is considered to be relatively low with the vegetation and animals typical for the waterless zones of the steppe. The potential risk of collision and/or electrocution impacts from the turbines and power lines is not likely to be very significant as long as mitigation measures for collision and electrocution impacts are incorporated in the Project design.
Climate Risks. The Project site is located in a continental zone with large daily and annual air temperature fluctuations (-8°C and -32°C during winter and 34°C to 45°C during summer). Temperatures in Kazakhstan are projected to rise at a faster rate than the global average and faster than most other Asian nations and has a potential warming of 5.3°C by the 2090s. Climate change is expected to cause droughts, land degradation, desertification, and associated events such as dust storms. The turbines to be installed in the Project can withstand high temperatures and they will be equipped with a cold type temperature package to withstand low temperatures during winters. The ESAP requires Shokpar to monitor ice build-up on the wind turbines and consider anti-icing measures.
The Project contributes to Kazakhstan’s nationally determined contribution (NDC) to reduce GHG emissions and increase the uptake of renewable energy. Based on the activity type (wind power generation), AIIB's entire financing for the Project can be counted as climate mitigation finance. Additionally, the Project contributes to adaptation finance since wind power plants projects consume almost no water and when added to the grid, they displace water intensive thermal power production. It is aligned with national adaptation/resilience pathway under 2030 Water Resource Management Strategy as it will support country’s water conservation efforts. In water scarce contexts such as in Kazakhstan, the displaced energy and associated water consumption are material for the climate resilience of the country through avoided water consumption (analogous to avoided GHG emissions).
Social aspects. The Project Developer has completed the land acquisition process for the plots under wind turbine generators (WTGs) and reached easement agreements for the land leases under the 220kV transmission power line route through voluntary negotiations with the landowners. The Project has been prepared in accordance with local regulations and is not expected to cause physical or economic displacement in the form of loss of livelihood. Currently, the Project area is mainly used for grazing nomadic animals (horses, sheep, goats). The Project would have a minimal impact as these activities can be continued on the adjacent available land. Community and livelihood impacts were also analyzed, and it has been identified that they are mainly associated with increased traffic during construction and visual effects, which are considered negligible. Social, labor, and safety aspects during construction and operation were analyzed. Several recommendations were presented to the EPC contractor to strengthen its institutional capacity to manage E&S risks during the construction and operational phases and deliver the Project in line with EBRD's PRs. Moreover in order to enhance women’s access to economic opportunities, the client with the cooperation of stakeholders aims to carry out a number of tasks, including establishment of training and internship program for high school and university students, cooperate/partner with local educational providers to improve the perception and awareness of the employment and entrepreneurship opportunities for young women and men in the renewable energy sector; contribute to the development of a vocational guidance and employment programs in order to increase the number of women entrants in vocational educational programs. In order to mitigate the adverse impacts of Gender-Based Violence (GBV), Shokpar will develop a worker Code of Conduct, including GBV mitigation measures, and require its contractors to enforce the Code, with penalties leading up to dismissal.
Cultural Heritage. During the EIA process, the presence of archaeological/cultural heritage objects was identified within the Project allocated land plots. The archaeological survey of the Project area (confirmed the presence of two cultural heritage objects, namely (i) Aktogay Burial Ground (dated appr. IV-I cent. BC) and (ii) an ancient settlement Syzdykbaeva (est. ~40m2; dated appr. IV-I cent. BC). Following the local legislative requirements, the Project Company submitted the findings of the archaeology survey report to obtain a formal Archaeological Expertise conclusion. The archaeological finds have been collected from both sites and are currently temporarily stored at LLC Archaeological Expertise awaiting the Ministry of Culture and Sport’s decision regarding to which museum the findings should be delivered for collection and exhibition. In July 2020, the Project Company received a formal expertise conclusion stating that the cultural objects identified during the survey are not culturally and/or historically significant, and therefore, the area is not restricted for further development activities. Shokpar and the EPC Contractor and its subcontractors engaged in activities on-site will develop clear Chance Find procedure provide for relevant personnel among contractors to be trained in its use.
Labor and Working Conditions and Supply Chain. The Project will be co-financed with EBRD and AIIB will follow the approach adopted by the EBRD in addressing potential issues arising from labor and working conditions in the supply chain. Enhanced supply chain due diligence has been conducted in order to assess the working conditions and labor risks at the selected production facility, where the wind turbines are being assembled by Shokpar’s supplier. In addition to the labor audit at the facility level, a risk screening of the core/primary suppliers to Shokpar’s supplier will be conducted to review issues relating to labor and working conditions at the potential supplier/vendor level. The findings of the labor audit and supplier risk screening will inform the corrective actions on the improvement of the supplier management and traceability system for the Project and will be included in the Project’s ESAP, supplemented by Shokpar’s and its supplier's commitments on labor and working conditions in their supply chains.
Stakeholder Engagement, Consultation and Information Disclosure. Stakeholder engagement confirmed support for the Project and limited concern about its potential impacts. Shokpar has engaged with stakeholders to provide inputs into the Project design. Key issues/concerns raised by local communities during public hearings included the issue of noise as a result of construction activities; another aspect was the expectation from local residents for job opportunities during the construction phase of the Project. To facilitate a meaningful consultation process with Project stakeholders, including affected people and third parties, a project summary information in English, Kazakh and Russian is disclosed on EBRD’s website (KAZREF II - Shokpar Wind (ebrd.com)). A Non-Technical Summary (NTS), a summary of the ESAP and SEP in English, Kazakh, and Russian will be disclosed by the Borrower on its website, accessible at: https://sarysuwpp.kz/, and AIIB will provide links with this E&S documentation.
Project Grievance Redress Mechanism (GRM). A Project-level GRM has been established by Shokpar. It will disseminate information about the GRM at the Project level for stakeholders including local communities and Project-affected people (PAPs) in accordance with EBRD’s PR10 (Information Disclosure and Stakeholder Engagement) requirements. The information on the Project-level GRM and EBRD’s independent accountability mechanism will be disclosed in Kazakh/Russian in a timely and appropriate manner. The EPC Contractor will also be required to log in all complaints on site. Access to the Project-level GRM will be free of cost.
Monitoring. Monitoring and supervision missions will be carried out annually. Site visits to verify implementation of ESAP will be carried out jointly by the lender group. E&S monitoring reports will be prepared by Shokpar based on agreed format every six months during construction work, and annually thereafter.
