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Environmental and Social Data Sheet Luxembourg, 1.9.2020 Public Environmental and Social Data Sheet Overview Project Name: Iren Green Energy Loan Project Number: 2020-0397 Country: Italy Project Description: Financing of the Promoter's 2021-2025 investments to expand and renovate the district heating network in Turin. EIA required: yes Project included in Carbon Footprint Exercise1: yes (details for projects included are provided in section: “EIB Carbon Footprint Exercise”) Environmental and Social Assessment Environmental Assessment The Promoter is upgrading and extending the district heating network in Turin and surrounding metropolitan areas with the aim of integrating the existing sub-networks. The investments within the Programme can be grouped into seven areas, based on the geographical location and/or the goal. The extension and improvement of the district heating network is also an integral part of the solution to reduce the local air pollution. Turin saturation (storage + saturation): the investments consist in the completion of t he works to the new heat storage facility of Mirafiori Nord (2500 m3), and in the expansion of the district heating network to new users. The expansion consists in developing principally “last mile” pipelines. Torino Nord (expansion): the investments consist in the creation of a structural backbone to transport heat to new areas. Vallette network (refurbishment): the investments aim at refurbishing the old network operating at 60oC, by upgrading it to the standard 90oC /120oC. The upgrade allows to increase the reliability and quality of heat supply, while reducing the energy and carbon 1 Only projects that meet the scope of the Carbon Footprint Exercise, as defined in the EIB Carbon Footprint Methodologies, are included, provided estimated emissions exceed the methodology thresholds: 20,000 tonnes CO2e/year absolute (gross) or 20,000 tonnes CO2e/year relative (net) – both increases and savings. Luxembourg, 1.9.2020 emissions. It also allows each building to become autonomous in selecting the desired heating level. The investments include a 40 MW heat exchange substation (interface between the 120oC and the 90oC networks), and a new pumping station for the 90oC network, which will be powered also by a new 14kWp solar PV onsite plant San Salvario (storage + expansion): the investments consist in the completion of the works and infrastructure functional to the new heat storage facility of San Salvario (2500 m3), and in the interconnection with the heating networks of South and Center Turin including two railway crossings. Torino Nord-Ovest (network integration): the investments consist in the expansion and interconnection of the heating network that serves the municipalities of Grugliasco, Rivoli, and Collegno, located N-W of Turin, with that of Turin. Torino (meshing): the investments aim at increasing the degree of meshing of the existin g network in Turin. The assets to be developed include the crossing of the existing railway network. Torino Nord-Est (storage + expansion) : the investments aim at extending the heat supply to areas in North-East Turin that are currently not served, including the interconnection to the Leinì CHP plant (owned and operated by another major utility), and a new heat storage facility in an area in via Basse di Stura, already owned by the Promoter. The Project components would fall under Annex II of the Environmental Impact Assessment Directive (2014/52/EU amending the 2011/92/EU) leaving it to the national competent authority to determine whether an environmental impact assessment is required. According to the Italian national legislation “D.Lgs. 152/06, Second Part, Annex IV”, the EIA is to be prepared and provided for district heating networks exceeding 20 km. For the network components relevant to Turin saturation an EIA was already prepared in conjunction with “Termal Plant Politecnico” an investment not part of this Programme and approved with DGP 267-62819 del 09/03/2004.Similar situation for the network expansion in Torino Nord where the EIA has already been concluded and approved with n.DSA-DEC- 2009-0000245 of 3/04/2009. A new EIA is needed as per Regional Law n. 40 of 14 December 1998 for the Torino Nord- Est and at the time of appraisal the documentation and the relevant approval is not finalised. The location of activities will be in urban areas outside cultural heritage sites and protected nature sites. The typically expected and low impacts such as traffic congestion, dust and noise are temporary by nature and can be mitigated by good industrial practice. The works are subject to building permits to be provided by the local authorities and railway network operation in case of railways line crossing. The district heating pipelines located below the soil are less exposed to climate change events but the Promoter is well aware of the potential risks. The Promoter carried out a risk assessment and in 2020 it will adopt a Climate Risk Policy to monitor and manage the impact from climate change in their business and infrastructure. Such policy will be part of a wider Enterprise Risk Management. Furthermore, the Promoter will take care of flooding risks Luxembourg, 1.9.2020 mitigation during design and installation and a emergency plan for district heating that allow s the sectioning of network in case of emergency is already present. EIB Carbon Footprint Exercise The estimated annual absolute emissions of the Programme in a standard year of operation are 55.8 kt CO2eq and the relative annual emissions compared to the baseline are -75 ktCO2eq i.e. a net reduction in emissions compared to the baseline. Project emissions are represented by network losses and by the emissions to supply heat to new customers. The emission factor used for the latter is the average through the project implementation even if part of the heat is expected to come from plants that have spare heat offtake capacity and without requiring increase fuel use. The baseline is represented by the emissions from the individual gas-fired heating boilers that would be otherwise replaced by district heating, and by the emissions associated with electricity generation in electricity-only plants throughout the country, which would not be displaced by the electricity cogenerated alongside incremental heat. For the annual accounting purposes of the EIB Carbon Footprint, the project emissions will be prorated according to the EIB lending amount signed in that year, as a proportion of project cost. Social Assessment, where applicable The activities will be implemented in urban areas, the works have an important impact on traffic and urban life and require very good planning and coordination. Appropriate periodical meetings are held between the Turin Municipality and entities that are performing works in public roads such as the Promoter to minimize the impact through appropriate planning. The pipelines will be located in public areas such as roads. No expropriation is expected but only rights for easement when necessary. The Project is expected to provide short-term positive socio-economic impacts in the form of temporary employment opportunities. Public Consultation and Stakeholder Engagement Public consultation and publication of the authorities’ decisions and EIA reports are mandatory under the Italian legislations for environmental impact assessments. The past EIA was performed through public consultation with the participation of the citizens in the Turin city and public consultation will be made during the finalisation of the EIA covering Torino Nord-Est. Other Environmental and Social Aspects The Promoter has demonstrated sound practice with respect to environmental, health and safety management. In addition to procedures to meet regulatory requirements, the Promoter has a comprehensive environmental management system, which is applied to new Projects and monitors ongoing operations. The Promoter operations an policies are supported by the Health, Safety, Environm ent and Quality (HSEQ) management system complying with EN ISO 9001 on quality management, Luxembourg, 1.9.2020 EN ISO 14001 on environmental management, and EN ISO 18001 on occupational health and safety management Conclusions and Recommendations The Project is expected to reduce emissions of greenhouse gases and other air pollutants by replacing individual heat sources in residential and public buildings with centralised heat generation, by adding new renewable heat generation, by modernising existing heat generation assets and by increasing the overall efficiency of the district heating system. The substitution of individual coal, oil or gas fuelled boilers and ovens with subsequent reduction of air pollutants is very important in view of its long-lasting and significant problems with the air quality, especially in the densely populated central areas of the city. The Bank reviewed the environmental and social capacity of the Promoter including its organisation, processes and procedures, and deemed them to be good. Based on the information available, the Project is expected to have minor negative residual impacts and thus is acceptable for Bank financing from an environmental and social perspective subject to the following conditions. The Bank with appropriate Contractual conditions will ensure that: the Promoter will send to the EIB copies of all EIA screening decisions concerning the Programme components issued by the competent authority for nature and environment as soon as they are available; the Bank’s funds will not be allocated to distribution Programme components that require an Environmental Impact Assessment (EIA) until the EIA and the biodiversity assessment as well as the environmental permitting process have been finalised, to the satisfaction of the Bank; when the EIA is made available to the public, an electronic copy of the full EIA study shall be sent to the Bank; The Promoter will take into account and implement conditions expressed in any decision or EIA consent granted by the competent authority for nature and environment. .
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