Social Compliance Audit Report

Project Number: 53037-001 April 2021

Regional: AC Energy Green Bond Project (Subproject: GIGASOL3 Solar Farm Project)

Prepared by GIGASOL3, Inc. for the Asian Development Bank.

This social compliance audit 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. Social Due Diligence/Social Compliance Audit Report GIGASOL 3 SOLAR FARM PROJECT

I. INTRODUCTION

1. Subproject/Investment Description

1. AC Energy Philippines (ACEN) is the owner and developer of Gigasol 3 Solar Farm Project through its subsidiary, Gigasol3, Inc. It is the listed energy platform of AC Energy and Infrastructure Corporation (“AC Energy”, formerly, AC Energy Inc.). AC Energy is a wholly owned subsidiary of Ayala Corporation, one of the largest and most diversified conglomerates in the Philippines, with business interests in real estate, banking, telecommunications, water, power, infrastructure, industrial technologies, healthcare, and education. The core business of AC Energy is power project development, renewable and thermal power generation, and wholesale and retail electricity supply. ACEN also has an interest in oil and gas exploration through its investment in ACE Enexor, Inc. AC Energy owns 81.6% of ACEN.

2. Gigasol 3 is one of the 14 energy projects of ACEN (Table 1). The project aims to supply electricity to the Luzon grid, where there is an expected short supply and at the same time use clean and renewable energy to ease the shortfall. The project was first conceptualized in 2017 after which the feasibility study was conducted between 2018 and 2019 (Table 2). The construction of the facilities began on 01 July 2020 and will be completed on 09 February 2021. Construction is 59.11% complete as of 20 October 2020. To manage and operate the project, ACEN created Gigasol3 Incorporated, a fully-owned subsidiary.

Table 1 ACEN Energy Projects, Capacity and Location

No Project Capacity Location (MW) 1 North Luzon Renewables 81 Pagudpud, Ilocos Norte 2 North Wind Power 52 Bangui, Ilocos Norte 3 Luzon Peaking Plants 178 Bacnotan, La Union 4 Palauig Solar (Gigasol) 60 Palauig, Zambales 5 Alaminos Solar 120 Alaminos, Laguna 6 South Luzon Terminal Energy 244 Calaca, Batangas Corporation (SLTEC) 7 Maibarara Geothermal Plant 32 Sto. Tomas Batangas 8 Ingrid Peaking 150 Pililla, Rizal 9 Power Barges 66 Iloilo City, Iloilo 10 Guimaras Wind 54 San Lorenzo, Guimaras 11 Islasol 80 La Carlota and Manapla, Negros Occidental 12 Sacasol 45 San Carlos, Negros Occidental 13 Montesol 18 Bais, Negros Oriental 14 Biopower Plants 63 La Carlota City, Negros Occidental Source: https://www.acenergy.com.ph/about/

Table 2 Selected Data on Gigasol 3 Solar Farm Project: September 2020

Subproject Name Gigasol3 Solar Farm Project Developer and Operator AC Energy Philippines (ACEN) Ownership of Developer and AC Energy (81.6%) Operator Year of Incorporation of AC 23 July 2019 Energy Philippines Year the Sub-project was First 2017 Conceptualized Inclusive Years of Conduct of 2018-2019 Feasibility Study Type of Agreements signed Solar Energy Operating Contract, 27 February 2020 with Government Agencies and Date of Signing Licenses obtained From the Municipal Endorsement Government and Date of Environmental Compliance Certificate (ECC) Issuance Barangay Endorsement Locational Clearance Zoning Certificate Building Permit - 30 June 2020 Bureau of Customs Certificate of Registration – 24 January 2020 Board of Investment Certificate of Registration – 10 July 2020 Tree Cutting Permit for Mango Trees – 10 October 2019 Tree Cutting Permit for Other Fruit Bearing Trees – 05 December 2019 Tree Cutting Permit for Planted Trees – 03 February 2020 Tree Cutting Permit for Naturally Grown Trees – 11 March 2020 Tree Cutting Permit for Narra – 24 February 2020 Estimated Project Cost (USD) 38,350,000 USD Inclusive Years of 2020-2021 Construction Corporate Name of Main ERS Energy Sdn. Bhd and JC Electrofields Power Systems Contractor Inc. Names of Sub-Contractors Sarmiento Group, YFK Engineering, Aguilar (MGA), Ariel Hernandez Dungo (AHD), Keon Construction, Frank Pamintuan (FRP), Impedance Engineering (IES), Albertous (AC), Etreme Solar (ES), Ulyses, Shield Construction, RSC Percentage of Completion as 59.11% of 20 October 2020 Commercial Operating Date 09 February 2021 Project Lifespan in Years 25 years Capacity 63 MWp DC Buyer of Electricity Produced Wholesale Electricity Spot Market (WESM)

3. The Engineering, Procurement and Construction (EPC) contractors are ERS Energy Sdn. Bhd and JC Electrofields Power Systems Inc which were granted the Notice to Proceed on 16 February 2020. The former is a company based in Kuala Lumpur, Malaysia while the latter is based in Velenzuela City, Philippines.1 The expected commercial operating date of the project is on February 9, 2021. It will have a production capacity of 63W p DC. The electricity generated from the power plant will be evacuated to the national grid by tap-in connect at Pole 208 of NGCP's 69kV Botolan-Candelaria Transmission Line that is located within the project site. The total construction cost is 38,350,000 USD.

2. Objectives and Scope of the Report.

4. This report contains the result of the social audit conducted on Gigasol3 Project on 21 September and 15 November 2020. It is prepared as part of the requirement of Asian Development Bank (ADB) which is considering financing the project. The financing will be through a private sector loan to ACEN. Through this report, ADB will determine whether ADB 2009 Safeguard Policy Statement (SPS) requirements and other ADB social policies are applicable. If these are applicable, the social audit determines the degree of compliance to the requirements and policies. In addition, the audit also confirms the project’s compliance with applicable national laws. Through the audit process and result, ADB will confirm the following:

(i) that all key potential social impacts and risks of a project are identified; (ii) that effective measures to avoid, minimize, mitigate, or compensate for the adverse impacts are incorporated into the safeguard plans and project design; (iii) that the borrower/client understands ADB’s safeguard policy principles and requirements as laid out in Safeguard Requirements 1–4 and has the necessary commitment and capacity to manage social and environmental impacts and/or risks adequately; (iv) that the role of third parties is appropriately defined in the safeguard plans; and (v) that consultations with affected people are conducted in accordance with ADB's requirements (Paragraph 56).

5. If there are aspects of non-compliance, this report will recommend corrective measures. The conduct of social audit intends to fulfill the requirements of 2009 ADB Safeguard Policy Statement (SPS) on existing facilities which it defines as facilities and/or business activities that already exist or under construction. For these facilities, the requirement is as follows:

The borrower/client will undertake an environment and/or social compliance audit, including on-site assessment, to identify past or present concerns related to impacts on the environment, involuntary resettlement, and Indigenous Peoples. The objectives of the compliance audit are to determine whether actions were in accordance with ADB’s safeguard principles and requirements for borrowers/clients, and the project’s compliance with applicable national laws and regulations, and to identify and plan appropriate measures to address outstanding compliance issues. Where noncompliance is identified, a corrective action plan agreed on by ADB and the borrower/client will be prepared. The plan will define necessary remedial actions, the budget for such actions, and the time frame for resolution of noncompliance (2009 ADB SPS Appendix 4 Paragraph 12).

3. Methodology

6. Primary and secondary information are used to prepare this report. The sources of primary information are on-site observation and interview with key stakeholders and project staff. Due to existing coronavirus disease (COVID 19) pandemic control measures, primary data collection was

1 https://www.ers.my/about-ers-energy/ and http://www.jcelectrofields.biz/AboutUs/CompanyProfile made virtually. The on-site observation was conducted through a video tour and review of still photographs which provide aerial and ground views of the site and vicinity.

7. To collect information from key stakeholders, a two-tier interview was conducted. This was done by preparing a set of guide questions beforehand and sending these to the interviewees so that they could review and prepare the answers. The project staff subsequently administered the guide questions to the interviewee as the first-tier interview between 30 September and 14 October 2020. The responses to the guide questions were sent to the social auditor who subsequently conducted the second-tier interview on 14-15 October 2020. The interview which was done online confirmed and clarified the interviewee’s responses to the guide questions and probed for more information. The list of interviewees is in Appendix 1 and the guide questions are in Appendix 2.

8. The interview of the project staff and representatives with main contractors were done on 23 October 2020. There were also intermittent interviews of the project staff conducted as part of the weekly meetings with the social and environmental auditors. The secondary information is from national laws and documents from the Philippine Statistics Authority, Palauig Municipal Government, Barangay Government of Salaza and Cauyan and AC Energy Philippines as well as scholarly studies and publicly accessible information in the internet. The list of the documents reviewed is in Appendix 3.

II. DUE DILIGENCE/AUDIT FINDINGS

4. Location

9. Administrative Units and Geography. The 58-hectare project site is located in two adjacent barangays of the Municipality of Palauig, Zambales (Table 3). The province is in northwest of Luzon but under the administrative region of Central Luzon (Region 3). Its geographic coordinates are 119-57-1.987 E longitude and 15-26-49.068 N latitude. Although the municipality is along the coast facing the West Philippine Sea, the project site is in the interior part, in an area with gently sloping and undulating terrain (Map 1). The two barangays where project site is specifically sited are Salaza and Cauyan. Around 49 (84%) has of the project site are within Barangay Salaza and 9 (16%) has are within Barangay Cauyan. It is 4.8 km from the municipal connected through a concrete barangay road and Olongapo-Bugallon Road.

Table 3 Key Description of the Location of the Gigasol3 Project Site

Location Barangay Salaza and Cauyan, Palauig, Zambales, Philippines Geographic Coordinates 15-26-49.068 N, 119-57-1.987 E, (Latitude and Longitude) Terrain Gently sloping undulating terrain Distance from Palauig 4.8 km municipal Center to the site (in km) Distance from Salaza 0.8 km barangay center to the site (in km) Distance from Cauyan 2.0 km barangay center to the site (in km)

Map 1: Project Location

10. Population Size, Growth and Density. The Municipality of Palauig had a population of 33,286 in 2010.2 This population size expanded to 34,947 in 2015 (Table 4). Within the five-year period, the annual population growth is 0.93 percent. This is much lower than the national population growth of 1.72 percent. Since the natural increase (number of births minus number deaths) in the municipality is comparable to the national rate, the only reason for this lower population growth rate is a negative net-migration (in-migration minus outmigration). The municipality is clearly an outmigration area.

2 National Statistics Office. 2012. 2010 Census of Population and Housing, Report No 1-E. Region III-Central Luzon. Population by Province, City/Municipality and Barangay. Manila. April.

11. The population growth rate is even much lower in the two barangays where the project site is located. Barangay Salaza grew by only 0.12% between 2010 and 2015 while Barangay Cauyan had a negative growth of 0.75 percent. The low population growth means low density in terms of land-people ratio. The municipality of Palaiug has an area of 310 square km or only 113 persons per square km in 2015. This is only about one-third of the 2015 national density of 337 persons per square kilometer. The density in Barangay Salaza is even lower at 28 persons per square km but it is higher in Barangay Cauyan at 287 persons per square kilometer. The municipal and barangay density reflects their rural characteristics. The municipality has no area classified as urban under the categorization of the National Statistics Coordination Board (NSCB) although the municipal government considers two barangays (East and West Poblacion) and urban.3

12. Ethnicity. The last national census which covered ethnicity at the municipal level was in 2000.4 Based on its result there were three main ethnic groups in Paluig based on their number: Zambals, Tagalog and Ilocano. This situation is confirmed to be still the same in 2020. In the 2000 census, 45.7% of the population identified themselves as Zambal. They constitute the dominant group in the municipality. The Tagalogs comprise 29.7% and the Ilocanos, 20.0 percent. Only 1.0% of the population identified themselves as Aeta or Negrito.

Table 4 Selected Demographic Data on Palauig Municipality and Barangays Salaza and Cauyan

Indicator Data Population (2015) Palauig Municipality 34,947 Barangay Salaza 4,126 Barangay Cauyan 1,081 Annual Population Growth Rate (2010-2015) Palauig Municipality 0.93% Barangay Salaza 0.12% Barangay Cauyan (0.75%) Population Density Palauig Municipality 113 persons per sq. km. Barangay Salaza 28 persons per sq. km. Barangay Cauyan 287 persons per sq km Distribution by Ethnic Group in Palauig (2000) Aeta/Negrito 1.0% Ilocano 20.0% Tagalog 29.7% Zambales 45.7% Others 3.6% Total 100.0 Gender Distribution in Palauig (2015) Men 51% Women 49 %

3 Municipality of Palauig. 2014. Comprehensive Land Use Plan (CLUP). Eco-social-2

4 National Statistics Office. 2003. 2000 Census of Population and Housing, Report No 2. Volume 1. Demographic and Housing Characteristics. Manila. Total 100% Number of Women per 100 Men 96 women Literacy Rate (10 years old and over) in Palauig (2015) Men 99.0% Women 99.1% Total 99.0% Average Household Size in Palauig (2015) 4.4 members Number of Dependents Per 100 Economically Active Adults 62 dependents (2015) Sources: Philippine Statistics Authority. 2017. 2015 Census of Population. Demographic and Socioeconomic Characteristics. Report No. 2. June; National Statistics Office. 2012. 2010 Census of Population and Housing, Report No 1-E. Region III-Central Luzon. Population by Province, City/Municipality and Barangay. Manila. April; National Statistics Office. 2003. 2000 Census of Population and Housing, Report No 2. Volume 1. Demographic and Housing Characteristics. Manila; .and Paluig Office Municipal Health Officer. 2019. Municipal Health Profile.

13. Gender Distribution, Literacy and Education. The population of the municipality is almost equally distributed by gender. There are 99 women per 100 men. This means that the outmigrants are both men and women of almost equal number. The literacy rate of the population is very high at 99.0% and the women are just as literate as the men. But women are slightly more educated than the men. Around 2.6% of the men are without any education but only 2.4% of the women are in the same situation (Table 5). Among the women 8.3% graduated from college but only 5.7% of the men have done the same.

14. Household Size and Dependency Burden. The average household in the municipality of Palauig has 4.4 members in 2015. This is the same as the national average. The dependency burden is still on the heavy side. There are 62 dependents (persons aged below 14 years old and over 65 years old) per 100 economically active adults (persons aged 15-64 years old). This means that every economically active adult has to support one or two dependents.

Table 5 Highest Grade Completed of the Population of Palauig by Gender (5 years old and over):2015

Grade Men Women Total None 2.6% 2.4% 2.5% Pre-school 3.0% 2.9% 2.9% Elementary 1-4 15.2% 13.4% 14.3% 5-6 5.2% 5.1% 5.1% Graduate 11.7% 12.1% 11.9% High School Undergraduate 15.7% 14.7% 15.2% Graduate 30.0% 27.8% 29.0% Post-secondary Undergraduate 0.1% 0.1% 0.1% Graduate 2.7% 4.1% 3.4% College Undergraduate 8.0% 9.0% 8.4% Graduate 5.7% 8.3% 7.1% Post-graduate 0.1% 0.1% 0.1% Total 100% 100% 100% Source: Philippine Statistics Authority. 2017. 2015 Census of Population. Demographic and Socioeconomic Characteristics. Report No. 2. June

15. Employment. The concentration of employment in the municipality of Palauig is in skilled extractive work (agriculture, forestry and fishery) as well as elementary occupations.5 Around 25.6% of the labor force (15-64 years old) are employed in skilled agriculture, forestry and fishery work (Table 6). Those who have elementary occupations compose 19.6 percent. More men than women are in employed in skilled agriculture, forestry and fishery work (34.0% versus 5.1%).

16. But there are more women than men in elementary occupations (21.8% versus 18.7%). The highest concentration of women is in service and sales work where 23.4% of them are employed. Only 9.4% of the men are in the same sector. The women nonetheless dominate the higher tier occupational sector: Around 14.5% of the women are managers versus 3.7% of the men. The women who work as professional compose 10.4% versus 1.9% of the men. The technicians among women comprise 4.7% versus 2.4% among men. The higher percentage of women in higher occupational tiers is consistent with their higher educational attainment compared to the men.

17. Poverty. The estimated poverty rate in Palauig in 2015 was 22.91%.6 But the estimate of the Municipal Planning and Development Office (MPDO) is 53.9% in the same year. At the barangay level, the captain of Barangay Cauyan considered 10.0% of its households as poor but in Barangay Salaza, the captain considered 70.0% of its households as poor. The Municipality of Palauig operates a Food-for-Work Program for the poor. Barangay Cauyan has no program for the poor while Barangay Salaza distributed relief goods as part of its response to the pandemic.

Table 6 Major Gainful Occupation of the Population of Palauig by Gender (15 years old and over): 2015

Occupation Men Women Total Managers 3.7% 14.5% 7.0% Professionals 1.9% 10.4% 4.4% Technicians 2.4% 4.6% 3.0% Clerical 1.8% 5.4% 2.9% Service and Sales Work 9.4% 23.6% 13.5% Skilled Agriculture, Forestry and Fishery Work 34.0% 5.1% 25.6% Craft work 14.9% 10.6% 13.5% Plant and Machine Operation 12.9% 3.9% 10.3% Elementary Occupation 18.7% 21.8% 19.6% Armed Forces 0.3% 0.1% 0.2% Total 100% 100% 100% Source: Philippine Statistics Authority. 2017. 2015 Census of Population. Demographic and Socioeconomic Characteristics. Report No. 2. June

5 Elementary occupations involve the performance of simple and routine tasks which may require the use of hand-held tools and considerable physical effort. Most occupations in this major group require skills at the first ISCO skill level. Examples are cleaning, restocking supplies and performing basic maintenance in apartments, houses, kitchens, hotels, offices and other buildings; helping in kitchens and performing simple tasks in food preparation; delivering messages or goods; performing various simple farming, fishing, hunting or trapping tasks performing simple tasks connected with mining, construction and manufacturing including product-sorting. 2012 Philippine Standard Occupational Classification. https://psa.gov.ph/classification/psoc/?q=psoc/major#:~:text=Tasks%20 performed%20by%20workers%20in,in%20food%20prepartation%3B%20delivering%20messages

6 Philippine Statistics Authority. 2015 Municipal and City Level Poverty Estimates. https://psa.gov.ph/content/psa-releases-2015- municipal-and-city-level-poverty-estimates

18. Social Services at Barangay Level. The social services in Barangays Salaza and Cauyan are limited to education and primary health care. In terms of education, both barangays have an elementary school but only Barangay Salaza has High School. The elementary school in both barangays have sufficient teachers and classrooms. Their student-teacher and student- classroom ratios are within the standard set by law at 45 students per teacher and per classroom in elementary school.7 But the High School in Barangay Salaza is short of classroom although it has enough teachers. There are 52 students per classroom. Both barangays have a Barangay Health Station (BHS) served by one nurse and one midwife. Given the population size of the two barangays, both have favorable BHS-population ratio. The national ratio is 5,126 people per BHS.8 Both barangays have no police station. The village police (barangay tanod) primarily maintain the peace and security in the two barangays. Its mandate stems from the 1991 Local Government Code which provides that the village council (Sanguniang Barangay) may form community brigades to carry out the purposes of the barangay government in accordance to the needs of public service (Article 387 and 391.16). The barangay captain directly supervises the barangay police based on its functions under the 1991 Local Government Code to enforce all laws and ordinances and maintain public order (Article 389.1 and 3).

Table 7 Social Services Available and Capacity in Barangays Salaza and Cauyan: 2020

Social Services Barangay Salaza Barangay Cauyan Elementary School Number of Teachers 14 8 Number of Classrooms 13 8 Number of Students 390 174 Number of Students Per Teacher 28 22 Number of Students Per Classroom 30 22 High School Number of Teachers 53 0 Number of Classrooms 28 0 Number of Students 1,447 0 Number of Students Per Teacher 27 0 Number of Students Per Classroom 52 0 Barangay Health Station Number of Nurses 1 1 Number of Midwife 1 1 Police Station Number of Police staff 0 0 Number of Barangay Tanods 10 18 Source: Barangay Captains of Salaza and Cauyan

7 Department of Education. DepEd Order No 77 Series 2010. Guidelines on the Allocation/Deployment of New Teaching, Teaching- Related and Non-Teaching Position. 4 June 2010 Section 2.a.1.a and Republic Act 7880. An Act Providing for the Fair and Equitable Allocation of DECS Budget for Capital Outlay. Section 3.

8 Dayrit, M. and others. 2018. The Philippine Health System Review: Health System in Transition. Vol 8. No 2. New Delhi: World Health Organization Regional Office for South-East Asia. p. 126 19. Municipal and Barangay Government Financial Capacity. Palauig is a 3rd class municipality indicating its limited financial capacity.9 Its average annual income between 2017 and 2019 is not available but in 2014 it was 92,221,123_PHP or a ratio of 2,639 PHP per person.10 The municipal internal revenue allotment (IRA) was largest income contributor amounting to 91.7% indicating the municipality’s dependence on the national government. Between the two barangays, Salaza is much better-off than Cauyan. Salaza’s average three-year income is 3,934,098 PHP (versus Cauyan’s 26,666 PHP) or per capita of 953 PHP (versus Cauyan’s 74 PHP).

Table 8: Income of Palauig Municipality and Barangays Salaza and Cauyan: 2020

Year Palauig Municipality Barangays Salaza Barangay Cauyan (PHP) (PHP) (PHP) 2017 No Data 3,371,481 20,000 2018 No Data 3,652,316 30,000 2019 No Data 4,778,496 30,000 3-Year Average 3,934,098 26,666 Income Per Person 953 74 Source: Palauig Municipal Development and Planning Office and Barangay Captains Salaza and Cauyan

5. Subproject Description

20. The 58-hectare project site is part of the 64-hectare block of land that GIGASOL3, Inc. bought from its corporate owner, Crismin Realty Corporation. The corporate owner grew mangoes, commercial trees and cattle in the land (Table 9). A land manager managed the land and paid workers tended the crops and cattle. There is no information on the number of workers. There were no public or private structures in the land. The MPDC, Barangay Captains of Salaza and Cauyan and two Aeta community leaders reported that no part of the land was not used for any social or cultural activities neither was it regarded as culturally or historically significant. The land was classified as agricultural under the municipality’s Comprehensive Land Use Plan (CLUP) but the municipal council reclassified is as industrial area under Municipal Ordinance No 161 Series 2019. GIGASOL3 Inc. signed the Deed of Sale for the land on 05 November 2018.

Table 9 Key Information on the Land Used as Project Site Before Land Acquisition

Item Data Total area purchased 64 has Date of Signing of Deed of Sale 5 November 2018 Total project area 58 has Land Classification Under Municipal CLUP Agricultural but reclassified as industrial by Municipal Ordinance 161 Series 2019 Land Cover Before Construction

9 The municipalities in the Philippines are classed based on annual income: 1st (55.0 million and over); 2nd ( 45.0- 54.9 million), 3rd (35-44.9 million); 4th (25-34.9 million); 5th 15-24.9 million); and 6th (below 15.0 M).Department of Finance. Department Order No. 28- 08. 29 July 2008. https://web.archive.org/web/20101113184319/http://www.nscb.gov.ph/activestats/psgc/articles/DepOrder Reclass.pdf

10 Municipality of Palauig. 2014. Comprehensive Land Use Plan (CLUP). Table 6.10 Mango orchard (in ha) 32 Commercial Tree plantation (in ha) 0 Natural Forest (in ha) 5 Grazing land mixed with trees (in ha) 21

Existing structures Road None Housing None Other structures None Area of cultural, historical or social significance None

6. Subproject Categorization on Involuntary Resettlement and Indigenous Peoples.

21. Under the ADB 2009 SPS the project is categorized as C for both Involuntary Resettlement and Indigenous Peoples. Category C means the project has no involuntary resettlement or indigenous peoples impact and no further action is required (OM Section F1/OP 1 October 2013 Paragraph 8 and 10).

22. Involuntary Resettlement. The project is categorized as C for Involuntary Resettlement for two reasons. One is that the land acquisition of the project site does not meet any of the criteria set by ADB 2009 SPS for involuntary acquisition. Another is that the restriction of access to the farms of five households imposed by site development is firmly resolved and no complaints from the affected households have been received by the project management and municipal and barangay officials after the resolution on 16 June 2020. For the first reason, the criteria set for involuntary acquisition in ADB 2009 SPS are contained in the paragraph below:

Resettlement is considered involuntary when displaced individuals or communities do not have the right to refuse land acquisition that results in displacement. This occurs in cases where (i) lands are acquired through expropriation based on eminent domain; and (ii) lands are acquired through negotiated settlements, if expropriation process would have resulted upon the failure of negotiation (Appendix 2 Paragraph 5).

23. The acquisition of the land serving as project site was a commercial transaction between two corporations where Gigasol3 Inc. was a willing buyer and Crismin Realty Corporation was a willing seller. Both parties had the right to refuse if the terms of acquisition were not satisfactory to any of them. Expropriation based on eminent domain was never employed in any part of the acquisition process.

24. The restriction of access occurred when a makeshift road used by five households to go to their farm that cut across the project site was closed. The closure due to site development constituted involuntary restriction of land use resulting to economic displacement through loss of access to assets, income sources or means of livelihood referred in ADB 2009 SPS (Appendix 2 Footnote 1). Although a public road that provides similar access exists, this was impassable to wheeled vehicle and prompted these five households to use the makeshift road cutting across the project site. The five households complained to the barangay government of Salaza and the project management. The project management improved the existing road rendering it passable to wheeled vehicle. The road improvement solved the access restriction.

25. Economic displacement may be a risk to the workers of Crismin Realty Corporation who used to work in the site although some of them were reportedly absorbed by the project as workers. But their risk of economic displacement was not due to land acquisition but cessation of operation of establishment. In this case, the provisions of ADB 2009 SPS are not applicable. The Philippine Labor Code covers the risk of workers retrenched due to cessation of operation of establishment under which Crismin Realty Corporation has the obligation to handle (Article 283).

26. Indigenous Peoples. A nine-hectare Aeta resettlement site with 1,150 people is located in Barangay Salaza, at least 7.0 kms from the boundary of the project site. The government resettled them on this site in 1991 after they were displaced from their home range in the municipalities of San Marcelino, San Narciso, San Felipe and Botolan, Zambales due to Mt. Pinatubo eruption. Although they are resettlers and are not in their ancestral territory, the ADB 2009 SPS still covers them under the following provision:

27. A group that has lost collective attachment to geographically distinct habitats or ancestral territories in the project area because of forced severance remains eligible for coverage under this policy (Appendix 3 Paragraph 8).

28. But the ADB 2009 SPS Indigenous Peoples safeguards are only triggered under the following condition:

If a project directly or indirectly affects the dignity, human rights, livelihood systems, or culture of Indigenous Peoples or affects the territories or natural or cultural resources that Indigenous Peoples own, use, occupy, or claim as an ancestral domain or asset (SR3).

29. Based on the information provided by the MPDC, Barangay Captain of Salaza and two Aeta community leaders, the project site has never been part of Aeta’s’ or any indigenous peoples’ territories. They never own, use, occupy or claim the project site in any point in history as an ancestral domain. They also never used its natural resources for economic, cultural, social and spiritual purposes nor has it any significance to them. They also reported that the project has no adverse impact on their dignity, human rights, livelihood systems, or culture. Instead it benefitted some Aeta households by providing employment to 14 persons. But for both negative and positive impacts, the ADB 2009 SPS provides the following:

Undertake a culturally appropriate and gender-sensitive social impact assessment or use similar methods to assess potential project impacts, both positive and adverse, on Indigenous Peoples (SR3.2)

30. The social impact assessment will serve as basis to prepare the Indigenous People Plan (IPP) (SR3. 6). The purpose of the IPP for project with positive impact on indigenous peoples is defined in ADB Indigenous Peoples Safeguards: A Planning and Implementation Good Practice Sourcebook (2013) as follows:

An Indigenous Peoples Plan (IPP) will need to be prepared for all projects having either significant (Category A) or limited (Category B) impacts on IP, even if only positive, as it is needed to mitigate the risks that they may not be able to capture the project benefits, improve their participation in sharing benefits, and address the possibility that effects may arise that may reinforce their vulnerability.

31. But this provision is not applicable to the project for two reasons. One is that employment is not an automatic project impact. It means that capturing it as a benefit requires intention and active effort from an interested person and the risk of not getting an employment rest on the person and not on the project. In this case, the project is not in the position to mitigate the risk because the person has to voluntarily get employed by the project to be impacted. Another is that the employment opportunities opened by the project is for all interested and qualified persons and not targeted at the Aeta. The project is not developed to produce benefits for the Aeta community and it does not require mitigation and compensation measures through project employment having no adverse impact on said community. In this case, the project does not need to ensure that the employment opportunity will go to Aeta vis-à-vis the non-Aeta which the IPP intends.11 Since the project has no impact on the Aeta community, it is not required to improve the Aeta community’s participation in sharing benefits versus the non-Aeta nor does the project reinforce their vulnerability. The issue will only arise when the Aeta applicant of better qualification is bypassed in employment in favor of the less qualified non-Aeta. But in this case, the issue is covered by national policies on equality of employment opportunities.12 Based on these reasons, the project is categorized as C in Indigenous People. The filled-up Categorization Forms for Involuntary Resettlement and Indigenous Peoples are in Appendix 4 and 5.

7. Scope of Land Acquisition and Resettlement Impacts.

32. The 58-hectre project site will accommodate the project’s seven main facilities, namely: (i) power plant including solar modules; (ii) substation; (iii) administration building; (iv) water pump and system; (v) internal roads; and (vi) 200-meter 69kV transmission line (Table 10). See Photo g in Appendix 8 for the GigaSol3 site lay-out. The power plant and solar modules will take the largest portion of the project site occupying approximately 54 % of its total area. Before it was developed for the project, the area had 1,423 mango trees, 604 planted timber trees and 359 naturally-growing trees along with 50 heads of cattle. There was an undetermined number of workers tending the trees and the cattle but there were no tenants and free users. While the trees yielded to site clearing, the cattle which were purchased with the land were relocated to the south east portion of the property. The 50-head cattle were purchased with the Deed of Sale signed on 12 December 2020. The site had no structures and had never been used for cultural, social or spiritual purpose by the owner or any member of the surrounding communities.

33. The site has ground water with a volume of 250 cu meters per month. But this water source was only used by the livestock and workers. No community water use was displaced by the land acquisition. Since the land purchased for the project site had a single corporate owner and purchased was a commercial transaction, there was no physical or economic displacement.

34. GigaSol3 purchased the land from Crismin Realty Corporation which was the title-holder. Its business address is Nepo Mart Complex 2009 Angeles City, Pampanga, Philippines.13 The corporation is one the family owned firms of the Nepomuceno clan which is based in Angeles City

11 The IPP will set out the measures whereby the borrower/client will ensure (i) that affected Indigenous Peoples receive culturally appropriate social and economic benefits; and (ii) that when potential adverse impacts on Indigenous Peoples are identified, these will be avoided to the maximum extent possible. Where this avoidance is proven to be impossible, based on meaningful consultation with indigenous communities, the IPP will outline measures to minimize, mitigate, and compensate for the adverse impacts.(ADB 2009 SPS Annex 3 Paragraph 16).

12 Equality in employment opportunities is guaranteed by the Philippine Constitution (Article XIII Section 3) and the Philippine Labor Code (Chapter 1 Article 3). Further, the Indigenous Peoples Rights Act provides that indigenous peoples have the right to be free from any form of discrimination with respect to recruitment and conditions of employment and the enjoyment of equal opportunities for admission to employment (Section 23). 13 https://www.infobel.com/en/philippines/crismin_realty_corp/angeles_city/PH100103072/businessdetails.aspx and which is considered prominent in regional politics and business. Its clan members have occupied high-ranking political positions at the local level since 1852.14 Apart from real estate, they have business interest in education, power, water supply, retail and agriculture. Their political and business activities are well-documented in both academic studies and the popular press.15

35. The development of the site initially closed a makeshift road that five households used to access their farm. This road which cut across the site was used as alternative because the government road was impassable to wheeled-vehicles. To restore the access, the project improved the government road which the five households currently use. Apart from this initial access restriction, the MPDC, Barangay Captains of Salaza and Cuayan and the two Aeta community leaders cannot cite any adverse impact resulting from site acquisition. The closest house to the boundary of the project site is 30 meters although there are farm huts closer to the boundary. From the barangay centers of Salaza and Cauyan, the project site boundary is 2 km away.

8. Applicable Laws and Regulations.

36. Philippine Policies. There are seven ways of acquiring land in the Philippines. One of which is private grant where a voluntary transfer or conveyance of private land by a private owner through sale or donation to a private or public entity is made.16 There are applicable laws in acquiring land through sale in terms of who can own land and how to transfer land ownership. Under the 1987 Constitution, only Filipino citizens can acquire land based on the following provision:

Table 10 Key Information on the Project’s Land Requirement, Affected Assets and Land Acquisition Process

Item Data Land requirement Power plant including solar modules (in ha) 31.6 has Substation (in ha) 0.0413 has Administration buildings (in ha) 0.028 has

Internal roads 3.9 has

Others (water pump and system, 200-m 69 kV 22.4307 has Transmission line, and easements) Total 58 has

14 Kreuzer, P. 2012. Mafia Style Domination: The Philippine Province of Pampanga. Report No. 114. Peace Research Institute. Section 3.12.

15 See for example Kuestner, A. 2016 Nepomuceno Legacy: The Construction of Elite Heritage. Master’s Thesis for Asian Studies. University of Hawaii at Manoa. December and https://newsinfo.inquirer.net/883787/the-boy-who-started-a-university

16 The six other ways are as follows: (i) public grant: acquisition of alienable lands of the public domain by homestead patent, free patent, sales patent, or other government awards; (ii) involuntary grant: acquisition of private party against the consent of the former owner through foreclosure sale, execution sale, tax sale or expropriation; (iii) inheritance: acquisition of private property through hereditary succession; (iv) reclamation: filling of submerged land, subject to existing laws and government regulations; (v) accretion: acquisition of more lands adjoining the banks of rivers due to the gradual deposit of soil as a result of the river current; (vi) prescription: acquisition of title by actual, open, continuous, and uninterrupted possession in the concept of owner for the period required by law.

Affected assets Mango trees 1,423 trees (stunted, non- productive) Planted Trees 604 trees Natural growing trees 359 trees Number of cattle 50 Water requirement Volume 250 cu meters/month Water source Ground water Current use water source None Number of users of water source by type of use Domestic – 4 Livestock – 50 cattle Affected Persons Name of Landowner (pre-acquisition) Crismin Realty Corporation Number of agricultural workers working for the land No information owner Number of tenants, free tillers and livestock owners 0 Inclusive Dates of Land Acquisition of Project Site See Table 11 (Steps Taken by AC Energy to Acquire the Land Used as Project Site) Preacquisition Tenurial Document of the Project Site Private Title Amount paid for the land in the project Site including the 102,747,360 standing assets (in PHP) Date of payment 05 November 2018; Total area of the contiguous land owned by the land 64 owner in the area including those not acquired by the project Distance of the boundary of project site to nearest private 30 meters house (in km) Distance from the Barangay Centers of Salaza and 2 km Cauyan Number of households using the project site to access 5 households their farms Mitigation measures for restricted access if occurring Improvement of existing road being the original access

Save in cases of hereditary succession, no private lands shall be transferred or conveyed except to individuals, corporations, or associations qualified to acquire or hold lands of the public domain. (Article XII Section 7)

37. The qualifications of those who can acquire lands of public domain through purchase are stated in 1936 Public Land Act (Commonwealth Act No. 141).

Any citizen of lawful age of the Philippines, and any such citizen not of lawful age who is a head of a family, and any corporation or association of which at least sixty per centum of the capital stock or of any interest in said capital stock belongs wholly to citizens of the Philippines, and which is organized and constituted under the laws of Philippines, and corporate bodies organized in the Philippines authorized under their charters to do so; may purchase any tract of public agricultural land disposable under this Act, not to exceed one hundred and forty-four hectares in the case of an individual and one thousand and twenty- four hectares in that of a corporation or association, by proceeding as prescribed in this chapter (Section 22).

38. The purchase will entail the transfer of ownership which is done through a contract of sale governed by the provisions of the Civil Code of the Philippines (Republic Act No. 386). It defines contract of sale as follows:

By the contract of sale one of the contracting parties obligates himself to transfer the ownership and to deliver a determinate thing, and the other to pay therefor a price certain in money or its equivalent (Article 1458).

39. The main conditions set by the Civil Code of the Philippines for the contract of sale are the following: (i) the thing subject to the contract must be licit and the vendor must have a right to transfer the ownership thereof at the time it is delivered (Article 1459); (ii) the thing subject to sale is determinate when it is particularly designated or physical segregated from all others of the same class (Article 1460): (iii) the requisite that a thing be determinate is satisfied if at the time the contract is entered into, the thing is capable of being made determinate without the necessity of a new or further agreement between the parties (Article 1460); and (iv) the goods which form the subject of a contract of sale may be either existing goods, owned or possessed by the seller, or goods to be manufactured, raised, or acquired by the seller after the perfection of the contract of sale (Article 1462); (v) the fixing of the price can never be left to the discretion of one of the contracting parties unless the price fixed by one of the parties is accepted by the other and the sale is perfected. (Article 1473); and (vi) the contract of sale is perfected at the moment there is a meeting of minds upon the thing which is the object of the contract and upon the price (Article 1475). After the contract of sale, the title of the land is transferred from seller to the buyer through the following process:

(i) Notarize the Deed of Absolute Sale. (ii) Prepare the following documents to pay the capital gains tax in the Bureau of Internal Revenue (BIR): (i) Deed of Absolute Sale; (ii) Original Transfer Certificate of Title (TCT); (iii) Certified True Copy of TCT from Registry of Deeds and Official Receipt/ Acknowledgment Receipt; (iv) Certified True Copy of the latest Tax Declaration; (v) Tax Identification Number (TIN) of seller (BIR Form No. 1904); (v) Photocopy of seller's government issued ID e.g. Passport; (vi) Tax Identification Number (TIN) of buyer (BIR Form No. 1904); and (vii) Photocopy of buyer's government issued ID. (iii) Pay the Capital Gains Tax in the BIR office where the land is located within 60 days starting on the date when the Deed of Absolute Sale was notarized. The Capital Gains Tax is 6% of the selling price or zonal value (BIR Form No. 1706) (iv) Pay the Documentary Stamp Tax which is 1.5% of the selling price (BIR Form No. 2000- OT) in the same BIR Office. (v) Get the Certificate Authorizing Registration (CAR) after about a month from the BIR Office. (vi) Prepare the following documents to register the land in the Registry of Deeds where the property is located: (i) notarized letter to the Register of Deeds requesting that a new TCT be issued; (ii) Certificate Authorizing Registration (CAR); (iii) Original Transfer Certificate of Title; (iv) Original Deed of Absolute Sale; (v) original Transfer Tax Receipt from Assessor's Office in the Municipal Hall; (vi) Original Tax Clearance Certificate from Municipal Hall; (vii) Original Capital Gains Tax (BIR Form No. 1706); (viii) original Documentary Stamp Tax (BIR Form No. 2000-OT) with receipts; and (ix) Tax Declaration of Real Property. (vii) Pay the registration fee at the Registry of Deeds. (viii) Get the TCT after about 1-2 weeks. (ix) Prepare the following documents to get a new tax declaration: (i) Certified True Copy of TCT and original TCT; (ii) certified True Copy of Certificate Authorizing Registration; (iii) Certified True Copy of Deed of Absolute Sale; and (iv) Certified True Copy of latest Tax Declaration (in the name of the previous owner) (x) Go to the Assessor's Office to get new tax declaration under the name of the new registered owner.

40. AC Energy Policies. Involuntary resettlement is covered by AC Energy ESMS policy. All AC Energy policies apply to ACEN and Gigasol3 Inc. Its provisions on involuntary resettlement is in Box 1. But since the land acquisition of the Gigasol3 project site is voluntary being a commercial transaction, these provisions do not apply. The applicable AC Energy Policy is the conflict-of-interest provision of its Code of Conduct and Ethics which provides as follows:

Directors, officers and employees shall not take part in any transaction of the Corporation with any enterprise with which they have personal or pecuniary interest. This prohibition extends to participation in the negotiation and approval of the transaction and to its implementation. In the case of the directors, they shall strictly comply with the provisions of Section 3.1 of the Board Charter (Section V.3).

Box 1 Involuntary Resettlement Provisions in AC Energy ESMS Policy AC Energy is committed to protecting communities, including indigenous populations and vulnerable populations, that are affected by its operations.

1. AC Energy seeks to build in areas with little or no population and will avoid involuntary resettlement wherever possible.

2. The company will engage with affected communities and local government units when acquiring land for its projects and through the lifecycle of its projects.

3. AC Energy will establish grievance mechanisms as early as possible in project development phases.

4. AC Energy will conduct a rapid assessment to determine if involuntary resettlement or physical and economic displacement will occur as a result of a project, whether involuntary acquisition of land affects a full parcel or only part of it and displacement is permanent or temporary.

5. In the case of physical displacement, AC Energy will provide compensation, in either resettlement property or cash, at full replacement cost for land and other assets lost.

6. In the case of economic displacement, AC Energy will compensate for lost assets and access to assets at full replacement cost, and provide opportunities to improve or at least restore their means of income-earning capacity production levels and standards of living. Source: AC Energy. Environmental and Social Management System Section 2.3.

41. Project’s Compliance to ADB 2009 SPS Standards. The acquisition of land by GigaSol 3 for the project site is not covered by ADB 2009 SPS Involuntary Resettlement safeguard policy because it was not involuntary. The ADB 2009 SPS considers the land acquisition involuntary when displaced when the landowner does not have the right to refuse land acquisition that results in displacement because the acquisition is through expropriation or negotiated settlements which would result to expropriation upon the failure of negotiation (Paragraph 5 Annex 2). AC Energy has no plan to acquire additional land for Gigasol3 project under the proposed ADB financing.

8. History and Status of Land Acquisition

42. GigaSol3 acquired the land for the project site following the legal steps. The 14-step process began with the inspection and survey of potential sites and will end with getting from the Assessor's Office the new tax declaration under the name of the company (Table 11). The process which began on October 2017 is not yet completed (Table 11). The Transfer Certificate of Title (TCT) is still being processed and the new tax declaration is yet to be obtained. The copy of the Deed of Sale is in Appendix 6. The copy of the Land Title (TCT No_044-2014000146” and “TCT No_044-2014000145) which is still in the name of Crismin Realty Corporation is in Appendix 7. The MPDC and Barangay Captains of Salaza and Cuayan did not receive any complaints on the acquisition of the land at any point of the process.

Table 11 Steps Taken by AC Energy to Acquire the Land Used as Project Site

No Step Date Done 1 Inspect and survey potential sites 2017 2 Select the Palguig property 2017 3 Negotiate with Crismin Realty Corporation 2017 4 Contract of sale is perfected after the meeting of minds upon the thing 2018 which is the object of the contract and upon the price (Article 1475). 5 Notarize the Deed of Absolute Sale. November 2018 6 Prepare the following documents to pay the capital gains tax in the Bureau November 2018 of Internal Revenue (BIR): (i) Deed of Absolute Sale; (ii) Original Transfer Certificate of Title (TCT); (iii) Certified True Copy of TCT from Registry of Deeds and Official Receipt/ Acknowledgment Receipt; (iv) Certified True Copy of the latest Tax Declaration; (v) Tax Identification Number (TIN) of seller (BIR Form No. 1904); (v) Photocopy of seller's government issued ID e.g. Passport; (vi) Tax Identification Number (TIN) of buyer (BIR Form No. 1904); and (vii) Photocopy of buyer's government issued ID. 7 Pay the Capital Gains Tax in the BIR office where the land is located November 2018 within 60 days starting on the date when the Deed of Absolute Sale was notarized. The Capital Gains Tax is 6% of the selling price or zonal value (BIR Form No. 1706) 8 Pay the Documentary Stamp Tax which is 1.5% of the selling price (BIR November 2018 Form No. 2000-OT) in the same BIR Office. 9 Get the Certificate Authorizing Registration (CAR) after about a month November 2018 from the BIR Office. 10 Prepare the following documents to register the land in the Registry of 2019-2020 Deeds where the property is located: (i) notarized letter to the Register of Deeds requesting that a new TCT be issued; (ii) Certificate Authorizing Registration (CAR); (iii) Original Transfer Certificate of Title; (iv) Original Deed of Absolute Sale; (v) original Transfer Tax Receipt from Assessor's Office in the Municipal Hall; (vi) Original Tax Clearance Certificate from Municipal Hall; (vii) Original Capital Gains Tax (BIR Form No. 1706); (viii) original Documentary Stamp Tax (BIR Form No. 2000-OT) with receipts; and (ix) Tax Declaration of Real Property 11 Pay the registration fee at the Registry of Deeds. 2020 12 Get the TCT 2021 13 Prepare the following documents to get a new tax declaration: (i) Certified 2020 True Copy of TCT and original TCT; (ii) certified True Copy of Certificate Authorizing Registration; (iii) Certified True Copy of Deed of Absolute Sale; and (iv) Certified True Copy of latest Tax Declaration (in the name of the previous owner) 14 Go to the Assessor's Office to get new tax declaration under the name of 2019 the new registered owner. Source: AC Energy

9. Indigenous Peoples

43. Philippine Policies. The commitment of the government to protect the right of indigenous peoples is expressed in three provisions of the 1987 Philippine Constitution. These provisions are as follows:

The State recognizes and promotes the rights of indigenous cultural communities within the framework of national unity and development (Article II Section 22).

The State, subject to the provisions of this Constitution and national development policies and programs, shall protect the rights of indigenous cultural communities to their ancestral lands to ensure their economic, social, and cultural well-being (Article XII Section 5).

The State shall recognize, respect, and protect the rights of indigenous cultural communities to preserve and develop their cultures, traditions, and institutions. It shall consider these rights in the formulation of national plans and policies (Article XIV Section 17).

44. These provisions are operationalized in the Indigenous Peoples’ Rights Act (IPRA) (Republic Act No. 8371). This act defines indigenous peoples as follows:

Group of people or homogenous societies identified by self-ascription and ascription by others, who have continuously lived as organized community on communally bounded and defined territory, and who have, under claims of ownership since time immemorial, occupied, possessed and utilized such territories, sharing common bonds of language, customs, traditions and other distinctive cultural traits, or who have, through resistance to political, social and cultural inroads of colonization, non-indigenous religions and cultures, became historically differentiated from the majority of Filipinos. Indigenous Cultural Communities/Indigenous Peoples shall, likewise include peoples who are regarded as indigenous on account of their descent from the populations which inhabited the country, at the time of conquest or colonization or at the time of inroads of non-indigenous religions and cultures or the establishment of present state boundaries who retain some or all of their own social, economic, cultural and political institutions, but who may have been displaced from their traditional domains or who may have resettled outside their ancestral domains. (Section II.1.l)

45. One of the main instruments provided in the Act to protect the rights of indigenous peoples is the Free, Prior and Informed Consent (FPIC) that should be rendered by the concerned group for any intervention meeting the following criteria: (i) exploration, development, exploitation and utilization of natural resources within ancestral domains/lands; (ii) research in indigenous knowledge, systems and practices related to agriculture, forestry, watershed and resource management systems and technologies, medical and scientific concerns, bio-diversity, bio- prospecting and gathering of genetic resources; (iii) displacement and relocation; (iv) archeological explorations, diggings and excavations and access to religious and cultural sites; (v) policies affecting the general welfare and the rights of ICCs/IPs; and (vi) entry of the military or paramilitary forces or establishment of temporary or permanent military facilities within the domains (Section III.7). Since the project does not affect any indigenous peoples and does not meet any of the FPIC criteria, none of the IPRA’s requirements applies to the project.

46. AC Energy Policies. The ESMS Policy expresses AC Energy’s commitment to protect communities, including indigenous populations and vulnerable populations, that are affected by its operations (Section 2.3). In its E&S assessments, it commits to cover the project risks to indigenous peoples (Section 3). It considers the procedures of the National Commission of Indigenous Peoples (NCIP) as priority tool in helping identify and develop actions to address E&S risks identified in the assessment (Section 4). The International Finance Corporation (IFC) Performance Standard on Environmental and Social Sustainability 7 (Indigenous Peoples) is also cited as best practice reference and standard (Section 4). But given that the project does not affect any indigenous peoples, AC Energy’s ESMS policy provisions on them will not apply.

47. Aetas in Palauig as Indigenous Peoples. The Aetas are the indigenous peoples in Zambales. They belong to the generic ethnic classification called Negritos which groups are still currently found in the Philippines, Malay Peninsula and Andaman Islands. Based on analysis of genomic data, the Negritos represent one of the earliest branches of the anatomically humans to have reached Southeast Asia where human presence dates back at least 40,000 years ago.17 Their current genetic and cultural diversity is a result of their long interaction with the environment, pre-existing archaic humans and the more recent migrants from mainland Asia. The Negritos in the Philippines are recognized as indigenous peoples and ethnic minorities by both by the government and scholars.18

48. The Negritos used to be found in many coastal areas in the country but have retreated inland with the expansion of settlements of other groups and the arrival of migrants19 This was the case of the Aetas in Zambales which went inland as the arrival of the Zambals from the East, Tagalogs from the South and Ilocanos from the North intensified.20 By 2010, the Aetas constitute

17 Jinam, T. A. and Others. 2017. Discerning the Origins of Negritos, First Sundaland People: Deep Divergence and Archaic Admixture. Genome Biology and Evolution. 9 (8) August. pp 2013-2022.

18 Jocano, F.L. 1998. Filipino Indigenous Ethnic Communities: Pattens, Variations and Typologies. Punlad Research House. pp 43- 68; Tenazas, R.C.P. 1974. Map of Better-Known Cultural Minorities of the Philippines. Philippine Quarterly or Culture and Society. 2: 1-2. March-June pp. 3-4: and Carino, J. 2012. Country Technical Notes on Indigenous Peoples’ Issues. Republic of the Philippines. International Fund for Agricultural Development (IFAD). November 2012. Table 1. . 19 Reed, W.A. 1904. Negritos of Zambales. Manila Bureau of Printing. Chapter 1.

20 Fox R. 1952. The Pinatubo Negritos: Their Useful Plants and Material Culture. The Philippine Journal Of Science. 81:3-4. September-December. P. 250 only 3.6% of the population of Zambales, numbering 19,291 out of the provincial population of 532,836.21 The three migrant groups have become dominant group with the Zambals composing 30.0% and the Ilocano and Tagalog at 27.4%, respectively.

49. The Aetas are associated with the mountain ranges of Zambales as well as Bataan, Western Pampanga and Tarlac and Southeastern Pangasinan22. But in Zambales, it was observed in 1903 survey that they were only in specific places in the towns of Botolan, San Marcelino, Subic and Olongapo.23 Palauig was not indicated as part of their location. The exclusion of Palauig as location of Aeta settlements in the earlier times seems to be confirmed by archeological evidence.24 The Municipal CLUP states that the Aeta inhibited the coastal settlement of Palauig in the pre-colonial times but this is neither substantiated by evidence nor collaborated by scholarly studies.25 In 2000 when the Philippine Statistics Authority last included ethnicity in its municipal level data, Palauig had 306 persons who consider themselves as either Aeta or Negrito.26 By this time, the municipality was already home to 42 ethnic groups. Nonetheless, the Zambal remained dominant comprising 45.7 percent. The Tagalog and Ilocano composed 29.5% and 20.1% respectively.

50. The Aeta settlement in Barangay Salaza in the municipality of Palauig was established in 1991. The government with the support of NGOs developed the area as a resettlement area (Dampay Resettlement Area) for Aetas from the municipalities of Botolan, San Felipe, San Marcelino and San Narciso, Zambales who fled their mountain homes when Mount Pinatubo erupted.27 In April 1992, the resettlement site had 330 families or 1,555 people.28 An area of 652 has of public land was originally earmarked by the Department of Environment and Natural Resources (DENR) for the resettlement area but it did not complete the survey and the required documentation for the Office of the President to issue a Presidential Proclamation to allocate the area for resettlement.29 The current Aeta settlement is 9.0 has but its tenure remains a public land. The Aeta households support themselves by farming cassava, corn and vegetables as well

21 National Statistics Authority. 2013. 2010 Census of Population and Housing. Report No. 2A. Demographic and Housing Characteristics. Zambales. April. Table 11.

22 Tenazas, R.C.P. 1974. Map of Better-Known Cultural Minorities of the Philippines. Philippine Quarterly or Culture and Society. 2: 1-2. March-June. p. 3.

23 Reed, W.A. 1904. Negritos of Zambales. Manila Bureau of Printing. Chapter 1.

24 Beyer, O.H. 1947. Outline Review of Philippine Archeology by Island and Provinces. The Philippine Journal of Science. 77:3-4. July-August. Pp. 224-225.

25 Municipality of Palauig. 2014. Comprehensive Land Use Plan (CLUP). Part II.I

26 National Statistics Office. 2003. Census of Population and Housing. Report 2. Vol. 1 Demographic and Housing Characteristics. January. Table 11.

27 Besas, D. 1994. The Rehabilitation of Mt Pinatubo Victims: A Case Study of Organizational Coordination in Dampay Resettlement Area, Barangay Salaza, Palauig, Zambales. Master’s Thesis in Social Work. University of the Philippines Diliman College of Social Work and Community Development. 17 April. pp. 72-80

28 https://openjicareport.jica.go.jp/pdf/11063377_02.pdf

29 Besas, D. 1994. The Rehabilitation of Mt Pinatubo Victims: A Case Study of Organizational Coordination in Dampay Resettlement Area, Barangay Salaza, Palauig, Zambales. Master’s Thesis in Social Work. University of the Philippines Diliman College of Social Work and Community Development. 17 April. pp. 83. as hired farm workers. They also hunt, forage and collect cogon and bamboo stalks in the forest. The bamboo stalks which are made into barbeque sticks and the cogon are sold. The limits imposed by some land owners around the settlement in the area where the Aeta could gather cogon and bamboo stalks have reduced their income opportunities. Transporting their produce to the market is also considered a problem.

51. The settlement is at least 7.0 km from the boundary of the project site and the closest Aeta-cultivated farm to the same boundary is 2.5 km away. The project site is not part of an area with Certificate of Ancestral Domain Title (CADT) or Certificate of Ancestral Domain Claim (CALC) or any ancestral domain claim. The Aeta community never used the project site or its natural resources for any economic, social, cultural or spiritual activity and no part of the project site is considered significant to them in any aspect. The MPDC, Barangay Captain of Salaza and the two Aeta community leaders considered the relationship between the Aeta and the other ethnic groups in the municipality and barangay as harmonious.

52. Project’s Compliance to ADB 2009 SPS Standards. The ADB 2009 SPS considers a group of people indigenous if it is a distinct, vulnerable, social and cultural group possessing the following characteristics in varying degrees: (i) self-identification as members of a distinct indigenous cultural group and recognition of this identity by others; (ii) collective attachment to geographically distinct habitats or ancestral territories in the project area and to the natural resources in these habitats and territories; (iii) customary cultural, economic, social, or political institutions that are separate from those of the dominant society and culture; and (iv) a distinct language, often different from the official language of the country or region (SR 3). The Aeta group in Barangay Salaza has all these characteristics (Table 12). Although they are already using Zambal, the language of the dominant group in Zambales, they did have their own distinct language which was gradually eroded and lost after hundreds of years of interaction with the dominant group. But the project does not trigger ADB’s Indigenous Peoples Policy because it does not affect the dignity, human rights, livelihood systems, or culture or the territories or natural or cultural resources that they own, use, occupy, or claim as an ancestral domain or asset (SR3).

Table 12 Characteristics of the Aeta Group in Barangay Salaza, Palauig Described Using ADB 2009 SPS Criteria

No Generic Characteristics of Characteristics of the Aeta Group in Barangay Salaza, Indigenous Peoples Per Palauig ADB 2009 Safeguard Policy Statement 1 Distinct, vulnerable, social and Anthropological studies consider the Aeta physically, socially cultural group and culturally distinct from other Philippine ethnic groups.1 In Palauig, they still depend on the forest for hunting and foraging although they already adapted sedentary dry land agriculture. Two local officials and the two Aeta chieftains consider their living standard similar to most of the municipal population. Their vulnerability arises from their dependence of the forest. The DENR is reportedly receiving private sector applicants for the management of the forest they use under the Integrated Forest Management Program (IFMP). Further, some landowners in the area have imposed limits to the collection of cogon and bamboo stalks which the Aeta depend for cash. 2 Self-identification as members The Aeta including those in Palauig identify themselves as of a distinct indigenous cultural distinct indigenous cultural group. Anthropological studies, group and recognition of this government documents and the municipal and barangay identity by others; government also recognize them as such.2 3 Collective attachment to Being refugees due to Mt. Pinatubo eruption the area currently geographically distinct habitats used by the Aeta in Palauig is not part of their ancestral or ancestral territories in the territories. But they already developed attachment to the area project area and to the natural they used for habitation, agriculture, hunting and foraging. resources in these habitats and territories; 4 Customary cultural, economic, The Aeta traditionally live in moving campsite where social, or political institutions leadership is defined by kinship, age, experience and that are separate from those of residence but nonetheless diffused and flexible.3 But in the dominant society and Barangay Salaza, they have an organization headed by a culture; chieftain. This is a people’s organization and operates separately from the government. 5 Distinct language, often The Aeta are mainly using Sambal, the language of the different from the official numerically dominant ethnic group in Zambales although there language of the country or may be dialectic differentiation. As the other Philippine major region. languages, Sambal is an Austronesian language of the Austronesian people in archipelagic Southeast Asia from around 4,000 BP. After millennia of interaction with the Austronesian people, no Negrito group still use their indigenous language.4 1 Tenazas, R.C.P. 1974. Map of Better-Known Cultural Minorities of the Philippines. Philippine Quarterly or Culture and Society. 2: 1-2. March-June pp. 3-4: and Carino, J. 2012. Country Technical Notes on Indigenous Peoples’ Issues. Republic of the Philippines. International Fund for Agricultural Development (IFAD). November 2012. Table 1. 2 Tenazas, R.C.P. 1974. Map of Better-Known Cultural Minorities of the Philippines. Philippine Quarterly or Culture and Society. 2: 1-2. March-June pp. 3-4: and Carino, J. 2012. Country Technical Notes on Indigenous Peoples’ Issues. Republic of the Philippines. International Fund for Agricultural Development (IFAD). November 2012. Table 1. 3 Jocano, F.L. 1998. Filipino Indigenous Ethnic Communities: Pattens, Variations and Typologies. Punlad Research House. pp 57-58; 4 Reid, L.A. 2013. Who Are the Philippine Negritos? Evidence from Language. Human Biology. 85:15 pp. 329-330 and Blench, R. 2016. Splitting Up Proto-Malayo-Polynesian: New Models of Dispersal from Taiwan. In: Austronesian Diaspora: A New Perspective. B. Prasetyo and Others (eds). Yogyakarta: Gadjah Mada University Press. P 77..

10. Consultation and Stakeholder Engagement.

53. Philippine Policies. The 1987 Constitution provides that the right of the people and their organizations to effective and reasonable participation at all levels of social, political, and economic decision-making shall not be abridged (Section 16). It also commits that the State shall, by law, facilitate the establishment of adequate consultation mechanisms (Section 16). In the development and operation of projects, the law that establishes the consultation mechanism is the Implementing Rules and Regulations (IRR) for the Philippine Environmental Impact Statement (EIS) System (DENR Administrative Order No. 2003-30) which operationalizes the EIS Law (Presidential Decree No. 1586). The IRR provides that social acceptability based on informed public participation is one of the three criteria to be used in EIA review and social acceptability as a result of meaningful public participation will be assessed as part of the Environmental Compliance Certificate (ECC) application (Section 1.d and f). It defines public participation as follows:

Open, transparent, gender-sensitive, and community-based process aimed at ensuring the social acceptability of a project or undertaking, involving the broadest range of stakeholders, commencing at the earliest possible stage of project design and development and continuing until post-assessment monitoring (Section 3aa).

54. The IRR’s Revised Procedural Manual (August 2007) provides the details of the required public participation activities for each step of the EIA process (Section 1.11).

55. AC Energy Policies. AC Energy Revised Corporate Governance Manual (16 October 2019) has the following provision on information disclosure:

The Management shall make proper disclosure of the Corporation’s management of material economic, environmental, social and governance aspects of its businesses and activities using the GRI Standards by Global Reporting Initiatives (Section V).

56. The AC Energy Code of Conduct and Ethics (11 June 2020) defines the criteria for the disclosure of information as follows:

Ensure compliance with all disclosure requirements, making sure that all disclosures of material information are full, fair, accurate, clear and timely (Section I.3).

57. Its Corporate Disclosures Procedures Manual provides for two types of public disclosure: structured and unstructured. The structured disclosure is made through annual, quarterly and other periodic reports. The unstructured disclosure are communications of corporate developments as they occur as may be necessary to update the investing public on information on the operations and business of the listed company based on the Philippine Stock Exchange Disclosure Guidelines and SEC Form 17 C. Release of information is first made to the Exchange prior to the media or the public. Selective disclosure is prohibited, however this limitation will not apply in the following instances: disclosure‐ is done to a person who is bound by duty to maintain trust and confidence to the issuers (e.g. auditor or legal counsel) and disclosure is done to a person who agrees in writing to maintain in strict confidence the material information and will not take advantage of it for personal gain.

58. Its ESMS requires that it should undertake a process of consultation to enable affected communities the opportunity to express their views on project risks, impacts and mitigation measures, and which enables the client to consider and respond to them.30 The qualifications it sets for consultation are as follows: (i). begin early in the process of identification of E&S risks and impacts and continue on an ongoing basis as risks and impacts arise; (ii) be based on the prior disclosure and dissemination of relevant, transparent, objective and meaningful and easily accessible information: (iii) enable meaningful participation through use of culturally appropriate measures, to reach them, engaging with stakeholders in their own communities and places where they feel comfortable and provision of opportunities for two-way dialogue; (iv) documented by keeping records of questions, comments, and suggestions they give and use these to adapt AC Energy Action Plans; and (v) report back on how their input has been used and considered.

59. Compliance Mechanism. AC Energy Revised Corporate Governance Manual requires its strict observance and implementation and imposes penalties for violations (Part Four). The Code of Conduct and Ethics enjoins all directors, officers, and employees of the Corporation to comply with the Code in their decisions, transactions, and interactions (Introduction). AC Energy has three-level compliance mechanism that cuts across its governance structure: project, management and Board of Directors. At the project level, E&S measures are implemented and monitored through the corporate ESMS. The implementation and monitoring have five phases: (i) assessment of E&S risks; (ii) management of E&S risks; (iii) approval of E&S plans and

30 AC Energy. 2019. Environmental and Social Management System (ESMS). 27 February. Section 5.2 communication platforms; (iv) implementation of E&S plans and communication platforms: and (v) monitoring and review of implementation performance.31 The 14 steps comprising these phases are shown in Box 2. The AC Energy E&S Manager and Project E&S Manager are mainly responsible for the implementation and monitoring of E&S measures. They report annually to the Senior Management on the progress and compliance of E&S plans. For ADB-funded projects, Appendix C2 of the ESMS is applicable as reference.

Box 2 Phases and Steps in the AC Energy ESMS Phase 1: Assessment of E&S Risks 1. Complete General E&S Risk Identification checklist 2. Complete Risk prioritization worksheet 3. Complete Stakeholder Mapping Worksheet 4. Complete the Emergency scenarios assessment worksheet Phase 2: Management of E&S Risks 5. Formulate the E&S Action Plan for Priority Risks 6. Formulate the Stakeholder Engagement Plan 7. Develop the Stakeholder Communication Platform—Disclosure, Consultations, Grievance Mechanism, and Ongoing Reporting 8. Formulate Emergency Preparedness Plans, as necessary Phase 3: Approval of E&S Plans and Communication Platforms 9. Secure approval of E&S Action Plans, Stakeholder Engagement Plans and Communication Platforms, and Emergency Preparedness Plans through an official memorandum Phase 4: Implementation of E&S Plans and Communication Platforms 10. Implement E&S Action Plans, Stakeholder Engagement Plans and Communication Platforms, and Emergency Preparedness Plans Phase 5: Monitoring and Review of Implementation Performance 11. Ensure ongoing compliance with national regulatory requirements and internal monitoring of E&S Action Plan implementation; 12. Conduct a semi-annual review on the progress and compliance of all E&S Action Plans and Stakeholder Engagement Plans 13. Annually report to Senior Management on the progress and compliance of E&S Action Plans and Stakeholder Engagement Plans 14. Conduct an annual E&S assessment onsite using the General E&S Assessment checklist to determine if any new risks have arisen Source: AC Energy. 2019. Environmental and Social Management System (ESMS). 27 February. Section 1.0

60. At the management level is the Chief Risk Officer (CRO). The CRO has two tasks critical to ensuring compliance. One is collaboration with the Chief Executive Officer (CEO) in updating and making recommendations to the Board Risk Management and Related Party Transaction Committee. Another is communicating the top risks and the status of the implementation of risk management strategies and action plans to the Board Risk Management and Related Party Transaction Committee. The full description of the CRO’s duties is Box 3.

Box 3

31 AC Energy. 2019. Environmental and Social Management System (ESMS). 27 February. Section 1.0 Duties and Responsibilities of Key Officers Ensuring Compliance to Corporate and Government Requirements A. Duties and Responsibilities of the Chief Risk Officer 1. Supervise the entire Enterprise Risk Management (ERM) process and spearhead the development, implementation, maintenance, and continuous improvement of ERM process and documentation; 2. Communicate top risks and the status of the implementation of risk management strategies and action plans to the Board Risk Management and Related Party Transaction Committee; 3. Collaborate with the CEO in updating and making recommendations to the Board Risk Management and Related Party Transaction Committee; 4. Suggesting ERM policies and related guidance as may be needed; and 5. Provide insights on whether risk management processes are performing as intended, risk measures reported are continuously reviewed by risk owners for effectiveness and established risk policies and procedures are complied with. B. Duties and Responsibilities of the Corporate Governance and Related Party Transaction Committee 1. Generally, ensure compliance with and proper observance by the Corporation of corporate governance principles and practices. 2. Oversee the implementation of the corporate governance framework and periodically review the said framework to ensure that it remains appropriate in light of material changes to the corporation’s size, complexity and business strategy, as well as its business and regulatory environments. 3. Oversee the periodic performance evaluation of the Board and conduct an annual self evaluation of its performance. 4. Ensure that the results of the Board evaluation are shared, discussed, and that concrete‐ action plans are developed and implemented to address the identified areas for improvement. 5. Recommend continuing education/training programs for directors, assignment of tasks/projects to board committees, succession plan for the board members and senior officers, and remuneration packages for corporate and individual performance. 6. Adopt corporate governance policies and ensure that these are reviewed and updated regularly, and consistently implemented in form and substance. 7. Propose and plan relevant trainings for the members of the Board. 2.2 Related Party Transaction C. Duties and Responsibilities of the Compliance Officer 1. Ensure the proper onboarding of new Director through orientation of on the corporate business, charter, articles of incorporation and by-laws among others; 2. Monitor, review, evaluate, and ensure the compliance by the corporation, its officers and directors with the relevant laws, the Corporate Governance for PLC and rules and regulations and all governance issuances of regulatory agencies; 3. Report to the Board if violations are found and recommend the imposition of appropriate disciplinary action; 4. Ensure the integrity and accuracy of all documentary submission to regulators; 5. Appear before the SEC when summoned in relation to compliance with the Corporate Governance for PLC; 6. Collaborate with other departments to properly address compliance issues which may be subject to investigation; 7. Issue and Annual Corporate Governance Report (ACGR) that is duly signed by the Chairman and CEO, the President and Chief Operating Officers and two Independent Directors of the Corporation very five years; 8. Issue consolidated changes in the ACGR that is duly approved by the board yearly; 9. Provide the SEC at the end of every fiscal year with a sworn certification that the requirement for Independent Directors and their attendance at meetings in accordance with Sec. II (7) of SEC Memorandum Circular NO. 2 has been complied with; 10. Identify possible areas of compliance issues and work towards their resolution; 11. Ensure the attendance of Board members and key officers in relevant training; and 12. Perform such other duties and responsibilities as may be provided by the SEC. Source: Corporate Governance and Related Party Transaction Committee Charter Section 2.1 and AC Energy. Corporate Governance Manual. pp. 14 and 16

61. At the level the Board of Directors, the Corporate Governance and Related Party Transaction Committee Charter created a Corporate Governance and Related Party Transaction Committee. It is tasked to ensure compliance to corporate governance principles and practices. It has at least three members, all of whom are independent directors, including the Chairman. The Committee may request the assistance of the officers of the Corporation in carrying out its tasks. Part of the board is the Compliance Officer who holds a position of a Managing Director. The task of the Compliance Officer is shown in Box 3. One of its tasks is to monitor, review, evaluate, and ensure the compliance by the corporation, its officers and directors with the relevant laws, the Corporate Governance for public limited company and rules and regulations and all governance issuances of regulatory agencies.

62. The risk management performance of AC Energy is subject to internal audit. The internal audit group covers not only business operation but also regulatory compliance.32 It is required to adhere to the Institute of Internal Auditors Code of Ethics and International Standards for Professional Practice of Internal Auditors. The corporate Integrated Annual Corporate Governance Report (31 December 2019) covers the performance of the implementation of Corporate Governance Manual, Code of Conduct and Whistleblowing and Non-Retaliation Policy following the format issued by Securities and Exchange Commission (SEC-Form ACGR).

63. Project Performance. The municipal and barangay officials first learned about the project in 2018. The MPDC reported that they learned about it when the project staff went to the municipal hall to apply for municipal permits. In case of the barangay officials, the project staff meet them to get a feel of the reception of the people of the project. The project was explained to them in greater detail in the stakeholders meeting conducted as part of the preparation of the Initial Environmental Examination (IEE).33 It was held on 19 July 2019 in the Barangay Salaza Covered Court. Project and the DENR representatives and the officials and residents of the two barangays hosting the project were in the meeting.

64. Around 54 barangay residents attended the meeting, 31.5% of them were women (Table 13). The following information was disclosed in the meeting: profile of the project developers, purpose of the project, technology and process used, project location and expected benefits. The benefits presented were as follows: (i) non-pollutant power production; (ii) reduced dependence on fossil fuel; (iii) employment; (iv) local area improvement and infrastructure; (v) contribution to local tourism; (vi) government revenue; and (vi) PHP 0.01 per kWh of total electricity sales going to the host communities as provided by Energy Regulation No. 1-94. The documentation of the meeting does not show of any issue raised.

Table 13 Participants of the Public Consultation Meeting Held as Part of the Project’s IEE Preparation

Barangay Number of Participants Total Men Women Cauyan 14 7 21 Salaza 15 10 25 Not Determined 8 0 8 Total 37 17 54 Source: LCI Envi Corporation. 2020. PHI: Gigasol3 Solar Farm Project. Initial Environmental Examination. Initial Draft. February. Appendix 2.

65. There has been no other community meeting held. But there were meetings with municipal and Salaza barangay officials. The municipal officials visited the site three times since the start of the construction period to conduct compliance monitoring to government regulations. The purpose of the visit is to determine if the project complies with the guidelines of the Department of Health

32 AC Energy. Corporate Governance Manual. p. 17.

33 LCI Envi Corporation. 2020. PHI: Gigasol3 Solar Farm Project. Initial Environmental Examination. Initial Draft. February.

(DOH) and Department of Public Works and Highways (DPWH). These Guidelines are shown in Appendix 8.

66. The Salaza Barangay officials met with some project staff on January 2020. A monthly meeting between the project management and the officials of the two barangays was agreed on March 2020 but this was never carried out due to the pandemic. Information from both sides is currently disclosed by mobile phone through the number of the Project Manager. This number is accessible to all residents in the two barangays and everybody. The communication line between the AC Energy and the captains of the two barangays is described by both sides as open. Project information is also disclosed through AC Energy website (https://www.acenergy.com.ph/) and the project’s Facebook page (https://www.facebook.com/pages/category/Solar-Energy- Company/Gigasol3-Solar-Farm-103068464875558/).

67. Project’s Compliance to AC Energy ESMS and ADB 2009 SPS Standards. The ADB 2009 SPS requires that consultations with affected people are conducted in accordance with ADB's requirements (Paragraph 56). A comparison of these requirements with those of AC Energy ESMS shows that there are two differences. ADB 2009 SPS requires that consultations to be meaningful must be undertaken in an atmosphere free of intimidation or coercion, gender inclusive and responsive, and tailored to the needs of disadvantaged and vulnerable groups (Paragraph 32). The AC Energy ESMS does not have these requirements (Table 14) Nonetheless, the consultations made for Gigasol3 project complied with these requirements. But the requirement on documentation was only partly complied due to the unavailability of meeting transcript. Due to this unavailability, there is no information showing that stakeholders’ views which were expressed in the meetings were incorporated in the project design and decisions as required by ADB 2009 SPS. This means that out of the seven ADB 2009 SPS requirements, five are fully complied. For the AC Energy ESMS requirements, three of the five are complied.

Table 14 Compliance of Gigasol3 Project to AC Energy and ADB 2009 SPS Requirements for Meaningful Consultation

No AC Energy ESMS ADB 2009 SPS Status of Compliance 1 Begin early in the Begins early in the project Complied. A meeting with barangay officials process of preparation stage and is carried and the community meeting done as part of IEE identification of E&S out on an ongoing basis preparation were done as part of the project risks and impacts and throughout the project cycle preparation stage. Monthly meeting with the continue on an (Paragraph 32) barangays was planned but not implemented ongoing basis as risks due to Covid19 restrictions. Open and impacts arise. communication with stakeholders through telephone and online is maintained. 2 Be based on the prior Provides timely disclosure of Complied. Project information was disclosed disclosure and relevant and adequate meeting with barangay officials and the dissemination of information that is community meeting done as part of IEE relevant, transparent, understandable and readily preparation. It is still disclosed through the open objective and accessible to affected people communication between the project staff and meaningful and easily (Paragraph 32) stakeholders, Although the presentation accessible information materials in the community meeting were in English, the discussion was in Tagalog and Sambal. 3 Enable meaningful Information about social and Complied. See Item 2 participation through environmental safeguard issues use culturally is made available in a timely appropriate measures manner, in an accessible place, to reach them, and in a form and language engagement with understandable to affected stakeholders in their people and other stakeholders, own communities and including the general public, so places where they feel they can provide meaningful comfortable and inputs into project design and provision implementation (Paragraph 53; opportunities for two- ADB Access to Information way dialogue Policy Paragraph 15.vi). 4 Documented by The consultation process and its Partly Complied. There no transcript on the keeping records of results are to be documented meeting with barangay and municipal officials. questions, comments, and reflected in the Although the community meeting done as part and suggestions they environmental assessment of IEE preparation was documented, there is no give and these should report (Appendix 1 Paragraph transcript on the discussion be used to adapt AC 19). Energy Action Plans. 5 Report back on how Enables the incorporation of all No Information. There is no documentation on their input has been relevant views of affected people stakeholders’ views which were expressed in used and considered and other stakeholders into the meetings and were incorporated in the decision making, such as project project design and decisions design, mitigation measures, the sharing of development benefits and opportunities, and implementation issues (Paragraph 32) 6 Undertaken in an atmosphere Complied. Photographic evidence of the free of intimidation or coercion community meetings indicates that there no (Paragraph 32) intimidation and coercion used. 7 Gender inclusive and Complied. Around 31.5% of the participants of responsive, and tailored to the community meeting done as part of IEE needs of disadvantaged and preparation. The meeting was held in the center vulnerable groups (Paragraph of Barangay Salaza so that the poor need not 32) pay for transportation to attend the meeting. Source: AC Energy. 2019. Environmental and Social Management System (ESMS). 27 February. Part on Engage in communications with Affected Communities Section 2 and ADB 2009 SPS.

67. Corporate Social Responsibility. ACEN is also engaged with its stakeholders through its Corporate Social Responsibility (CSR) Program.34 This program supports education and implements forest protection in communities around its project sites. The support for education in 2019 includes rehabilitation of 18 schools under government’s Brigada Eskwela Program, training of 119 science teachers, and work immersion of 60 high school students. For forest protection, its CSR Program monitors and protects 127 hectares of reforested areas in its three project sites. But none of these activities have been done in communities around GIgasol3 project site. One of its main contractors (EC Electrofields Power System Inc.) conducted three CSR activities: (i) blood donation in the drive sponsored by the Department of Health (DOH), Philippine Red Cross and Pagauig Municipal Government, (ii) disinfection of temporary Covid 19 isolation facility of Palguig; and (iii) coastal cleanup in Barangay Subic, Palauig.

11. Grievance Redress

68. Philippine Policies. The 1987 Constitution guarantees the right of the people to petition the government for redress of grievances (Section 4). This provision is one of the bases for the inclusion of complaint management as component of the Philippine EIS System. IRR’s Revised Procedural Manual (August 2007) (Section 2.4 and Annex 2.7b and 3.2). Under the Procedural Manual, the compliant management component include the following: (i) complaint receiving set- up procedures or protocols (preferably written), (ii) relevant documentation of specific cases, (iii)

34 AC Energy Philippines. 2019 Integrated Report. p.37 case investigation implementation of corrective measures, (iv) communication with the complainant, and (v) public complaint documentation.

69. AC Energy Policies. The AC Energy ESMS provides for the establishment of a grievance redress mechanism (GRM) to receive and facilitate resolution of the affected communities’ concerns about the project’s E&S performance.35 It specifies five required features of the GRM: (i) be publicized so people know where to go and whom to approach; (ii) enable people to contact AC Energy either openly or anonymously; (iii) established procedures to register, screen, categorize, investigate and determine resolution and redress options; (iv) established system to communicate decisions taken and progress on pending actions; and (v) committed response time and keep to it as this will increase transparency and a sense of “fair process.”

70. Gigasol3 Incorporated’s GRM is described in its Draft Policy for Redress of Community Grievance. It has two tiers. The first is the Grievance Committee which first assesses and resolves a grievance received from the community. It has three members: (i). Plant Manager; (ii) Company Stakeholder Engagement or CSR Manager; and (iii) Health, Safety, and Environment (HSE) Officer. The committee reports to the Head of Plant Operations. It may create ad hoc teams to assist in the investigation and evaluation of the grievance. If the grievance is not resolved at the first tier in a timely and satisfactorily manner, the Grievance Committee may refer it to the second tier. This tier is the Company’s upper management (Legal Head for Plant Operations/Development, Project Director, and Head of Sustainability). The GRM has nine steps to resolve a grievance from the community (Table 15). The Compliance Mechanism described in Section 10 applies to GRM Policies

Table 15 Steps in the Grievance Resolution Per Gigasol3 Incorporated’s Draft Policy for Redress of Community Grievance.

No Steps in Receiving and Resolving Complaints from Community Members 1 The complainant will file a grievance using one of the three methods: Fill out the Community Grievance Report Form available at the entrance of the Plant and submitting the same from 9:00 am to 6:00 pm of any Business Day to the security guard in charge. On a daily basis, the security guard in charge shall inform the site/plant administration personnel of received form Send an electronic mail to [email protected] and detailing the nature and details of the Grievance. Call 0917-560-6456 from 9:00am to 6:00pm on any Business Day. In this regard, the Project Lead for External Affairs shall inquire about the name and contact details of the Complainant, and the full details of the Grievance. The Project Lead for External Affairs will fill-out the Community Grievance Report Form on behalf of the Complainant and submit the same to the Grievance Committee. 2 The Company, through the Grievance Committee, will record all Grievances upon the submission thereof or as soon as practicable afterwards. All communications with the Complainant, and any actions to address the Grievance will likewise be recorded. 3 The Company will acknowledge the receipt the grievance through any of the contact information provided by Complainant within 24 hours from the time the Grievance was communicated or as soon as practicable afterwards. Further, the Company shall endeavor to give the Complainant an approximate timeframe, depending on the nature and gravity of the Grievance, for the resolution of the Grievance.

35 AC Energy. 2019. Environmental and Social Management System (ESMS). 27 February. Section 5.3 4 The Grievance Committee shall exert reasonable efforts to investigate and review all Grievances and will verify the veracity of a Grievance. If necessary, the Grievance Committee will contact the Complainant for clarification or any additional information about the Grievance. The Grievance Committee may also interview relevant stakeholders as resource persons. If the Grievance Committee determines that the Grievance is valid, the Company will identify and propose possible actions to address the Grievance. The Company will also examine actions previously taken to resolve a similar Grievance. 5 The Grievance Committee will discuss the findings with the Complainant and explain the proposed resolutions orally or in writing, depending on the circumstances. Once the Complainant agrees with the proposed resolutions, the Company will formalize the same through a letter or electronic mail and implement the agreed resolution. 6 If the grievance committee is unable to timely and satisfactorily resolve the grievance, it may refer the grievance to the Company’s upper management (Legal head for Plant Operations/Development, Project Director, and Head of Sustainability). The Grievance Committee shall then inform the Complainant of the revised timeframe for resolution of the Grievance 7 If the cost of resolving the grievance resolutions will exceed the existing appropriated budget, and for grievances that are forwarded already in the form of legal notices, the Head of Development, during the construction period, or the Company President, after commercial operations of the Plant, shall consult with the Legal head for Plant Operations/Development and make the appropriate recommendation for approval by the Board of Directors of the Company. 8 The Grievance Committee will continue dialogue with the Complainant until the Grievance is resolved. The final acceptance of Grievance resolution by the relevant stakeholder shall be evidenced in writing or thru a quitclaim, as applicable. 9 The Project Lead for External Affairs or Company Stakeholder Engagement Manager and CSR Manager, as the case may be, will monitor compliance with the GRM.

71. Project Performance. The only complaint that the project received was the restriction of access of five households resulting from the closure of makeshift road that cut across the project site. The complaint has been resolved through the improvement of an existing government road. The MPDC, captains of the two barangays and the two Aeta community leader have not received any complaint against then project or its activities or staff.

72. Project’s Compliance to ADB 2009 SPS Standards. The ADB 2009 SPS requires bank borrowers to establish and maintain a grievance redress mechanism to receive and facilitate resolution of affected peoples’ concerns and grievances about its social and environmental performance at project level (Paragraph 59). It has five requirements for its borrowers GRM. These requirements are as follows: (i) address affected people's concerns and complaints promptly; (ii) use an understandable and transparent process; (iii) gender responsive; (iv) culturally appropriate; and (v) readily accessible to all segments of the affected people. The AC Energy GRM process has to provide a fixed timeframe in resolving grievances preferably within 15 calendar days to meet the requirement of promptly addressing the complaint. It also has to include community members - one man and one woman – and if possible, other third parties to meet the requirements of transparency and gender responsiveness. This will also increase the level of impartiality. Without third party participation, this grievance review and appeal mechanism will function more of remediation mechanism between the complainant and the company than a dispute-resolution mechanism. It can also incorporate the Barangay Justice System (Katarungan Pambarangay) as provided in the Local Government Code (Section 17.b; 389.b.b; 515 and Chapter 7) in its GRM as third tier to enhance cultural appropriateness and impartiality.

12. Gender and Development

73. Philippine Policies. One of the Philippine state policies under the 1987 Constitution is the recognition of the role of women in nation-building and the fundamental equality before the law of women and men (Article 14). Along this policy is the Magna Charta of Women (Republic Act No. 9710). The policies contained in this law are as follows: (i) women empowerment and equal access to resources and development results and outcome; (ii) abolition of unequal structures and practices that perpetuate discrimination and inequality; (iii) condemnation of discrimination against women in all forms; and (iv) affirmation that women’s rights as human rights and provision of necessary mechanism to enforce women’s rights. There are numerous other laws and regulations promulgated aimed to promote gender equality and uplift the status of women. These laws include the 1995 Anti-sexual Harassment Act (Republic Act 7877) and the Act on Strengthening the Prohibition on Discrimination Against Women on Terms of Employment (Republic Act 6725). Many of these policies are promulgated as part of the implementation of the Philippine Plan for Gender- Responsive Development (1995-2025).

74. AC Energy Policies. AC Energy does not have specific gender policy. But it considers equal opportunity in employment and diversity as a management approach.36 Under this approach, the AC Energy will practice non-discrimination and breakdown of employees by age, gender and rank. The rationale for this practice is that a diverse and healthy workplace environment enables the Company to expand. Its Code of Conduct and Ethics and Table of Offenses have components intended to protect women against sexual harassment. The provision in Code of Conduct and Ethics is stated as follows:

The Corporation is committed to keep its work environment free from sexual harassment and all forms of sexual intimidation and exploitation, and will not tolerate harassment of its employees in the workplace. For this purpose, sexual harassment, as it is hereby defined, is considered a violation of this policy and is, therefore, forever banned in the working environment. (Section IX)

75. The Table of Offenses (HR-1A_Schedule 1) listed six offenses against persons. One in the list favors and protects women. The offense is described as follows:

Any grave immoral act by the employee either by himself or with another person committed within Company property or premises or job sites or during Company activities or commission of a crime or offense by the employee against any person involving destruction of life or any attempt to take a life. (HR-1A_Schedule 1) Table of Offenses: Offenses Against Person

76. Supporting these policies is its Whistleblowing and Non-Retaliation Policy which provides mechanism for reporting perceived and actual irregularities that are contrary to its Core Values while providing appropriate protection for whistleblowers from possible retaliation. One of AC Energy’s subsidiary, Trans-Asia Power Generation Corporation (renamed Bulacan Power Generation Corporation) has a Policy Against Sexual Harassment but this yet to be adapted at

36 AC Energy Philippines. 2019 Integrated Report. p.73. the ACEN level and in Gigasol Inc,37 Nonetheless, a hotline is provided to report any irregularity.38 The Compliance Mechanism described in Section 10 applies to Gender-relevant Policies

77. Corporate and Project Performance. The AC Energy Probationary Employment Contract provides for the employee’s agreement to abide by all corporate policies and regulations. In its Schedule of Benefits, there are two women-specific benefits: maternity leave (normal/caesarean birth) and special leave for women/solo parent. In practice, the AC Energy does employ women. Its 11-member Board of Directors has four women.39 The 12-person management team has four women as members.40 The employees record of AC energy is disaggregated by gender. The current employees of Gigasol3 and its contractors have 1.6% women (Table 16). At the project-site, a designated toilet is its only facility for women. Gigasol3 does not have yet CSR activities in the project site nor budget allocation for women-specific activities.

Table 16 Number of Workers by Gender in Gigasol3 and its Contractors and Subcontractors in Construction Phase: October 2020

Organization Number of Workers Total Men Women Gigasol3 7 1 8 ERS Energy Sdn. Bhd and subcontractors 4 1 5 JC Electrofields Power Systems Inc. and sub- 914 13 927 contractors. Total 925 15 940

78. Project’s Compliance to ADB Gender Policy. ADB’s policy on Gender and Development adopts mainstreaming as a key strategy in promoting gender equity. Mainstreaming means to consider gender issues in all aspects of ADB operations, accompanied by efforts to encourage women’s participation in the decision-making process in development activities. (Paragraph 78). The gap between this policy and those of AC Energy is that gender is not a specific consideration in its ESMS. Further, there are no gender and women-specific its training courses and CSR activities (See Section 10 and 13).

13. Labor and Social Protection

79. Philippine Policies. The 1987 Constitution guarantees the protection of labor and workers’ rights in the following provision:

The State shall afford full protection to labor, local and overseas, organized and unorganized, and promote full employment and equality of employment opportunities for all. It shall guarantee the rights of all workers to self-organization, collective bargaining and

37 https://acenergy.ph/governance/board-committee/company-policies/policy-against-sexual-harassment/ 38 AC Energy. Whistleblowing and Non-Retaliation Policy.

39 AC Energy Philippines. 2019 Integrated Report. p.19-26. The corporation’s Amended By-Laws requires 11 members of the Board but only 10 were mentioned in the 2019 Integrated Report due to the death of one member who has since been replaced by a male.

40 AC Energy Philippines. 2019 Integrated Report. p.36.

negotiations, and peaceful concerted activities, including the right to strike in accordance with law. They shall be entitled to security of tenure, humane conditions of work, and a living wage. They shall also participate in policy and decision-making processes affecting their rights and benefits as may be provided by law (Section 3).

80. These rights and the measures to protect these are described in detail in the Philippine Labor Code and related issuances of the Department of Labor and Employment (DOLE). These rights include the core labor standards: (i) freedom of association and right to collective bargaining (Articles 3, 243, 246); freedom from forced labor (Article 12b and c); (iii) freedom from child labor (Article 139); and freedom from discrimination in employment and occupation (Article 135, 140, 79). The International Labor Organization (ILO) has eight fundamental conventions upholding these standards all of which were ratified by the Philippines and have in- force status.41 Through ratification, these conventions become part of the national laws and must be complied with the Philippine Labor Code and related issuances.

81. AC Energy Policies. AC Energy’s Code of Conduct and Ethics provides that it conducts business in accordance with the applicable laws and regulations of the Philippines and such other jurisdictions in which the Corporation conducts its business. These laws include the Philippine Labor Code and other regulations protecting the rights of workers including the international conventions that the Philippines ratified.

82. The AC Energy ESMS also adheres to high levels of standards on a broader range of material issues that impact power companies. These include business ethics, labor practices, employee health and safety, water and waste management, as well as materials sourcing and efficiency, and product design and lifecycle management (Section 2.3.7). But it cannot be determined if the key provisions on the labor laws are reflected in the human resources policies of AC Energy because its Human Resources Manual of Policies and Procedures and Employee Handbook are not yet available. The AC Energy recruitment and retrenchment process as well as the employees’ GRM cannot be also determined. Contractors and suppliers are required to adhere to Philippine laws and regulations is a part of AC Energy’s management approach.42 But a sample of the contractors’ contract had not been available for review. The Compliance Mechanism described in Section 10 applies to labor protection policies.

83. Corporate and Project Performance. The management approach required contractors and suppliers to adhere to Philippine laws and regulations is not reflected in its Service Contractor Requisition Policy (HRA-PR 09 1 April 2020). The main contractors’ and subcontractors’ contracts have yet to be examined to determine if the requirement of compliance to Philippine laws and regulations is reflected in these documents. Further, AC Energy does not have standard procedure to ensure that its contractors and sub-contractors are complying with the labor laws and regulations.

41 The Philippines ratified 38 International Labor Organization (ILO) Conventions (CO) and 31 are in force. Those in force include all of the eight fundamental conventions on the following aspects: (i) Forced Labor (CO 29), (ii) Freedom of Association and Protection of the Rights to Organize Convention (CO 87); (iii) Rights to Organize and Collective Bargaining (CO 98): (iv) Equal Renumeration (CO 100); (v) Abolition of Forced Labor (CO 105); (vi) Discrimination (Employment and Occupation) (CO111); Minimum Age (CO 138); and Worst Form of Child Labor (112). https://www.ilo.org/dyn/normlex/en/f?p=NORMLEXPUB:11200:0::NO::P11200_ COUNTRY_ID:102970

42 AC Energy Philippines. 2019 Integrated Report. p.27-30

84. Around 76 % of the construction phase workers are from Palauig in which 26% are from Brgy. Salaza, 3% are from Brgy. Cauyan, and 47% are from within Palauig area. JC Electrofields and Brgy. Salaza municipal and barangay government signed a MOA that priority in employment is given to the residents of Barangay Cauyan and Salaza. During the operation phase, the workforce is expected to be reduced to 45 persons (Table 17). These persons will all be Gigasol3 Inc. employees and will be entitled to both law-mandated and voluntary benefits that AC Energy provides to its employees (Table 18). AC Energy develops its human resource through training. Between July and October 2020, it has 58 training courses offered (Table 19). The courses are on personality development, management and technical matters. There no information on the training that the contractors and subcontractors provide to workers.

Table 17 Number of Workers in the Pre-Construction and Construction Phase and Expected Number in the Operation Phase by Gender

Phase Men Women Total Pre-construction 4 0 4 Construction 925 15 940 Operation To be determined To be determined 45

Table 18 List of AC Energy Employees’ Benefits

No Benefits A. NON-TAXABLE CASH BENEFITS 1 Annual Rate a. Reimbursable Annual Family Medical Expense Limit 2 Christmas Gift Certificate (Privilege) 3 De Minimis 1 - Various Allowances (Monthly x 12 Months) 4 De Minimis - Annual Clothing Allowance 5 Reimbursable Transportation Expense Limit (Monthly x 12 Months) 6 B. GUARANTEED BONUS (including the mandatory 13th Month Pay) C. MEDICAL BENEFITS 7 Out-Patient Coverage, with basic dental care Employee's annual benefit limit Dependent's annual benefit limit 8 Hospitalization Coverage Employee's maximum benefit limit / confinement / disability Dependent's maximum benefit limit / confinement / disability 9 Annual Physical Exam d. Dental Coverage (under Villareal Dental Clinic) D. COMPANY PAID LIFE AND ACCIDENT INSURANCE 10 36 X Basic Monthly Salary or maximum cover, whichever is higher 11 Maximum Cover for Group Term Life / TPD Rider 12 Maximum Cover for Accident E. LEAVE OF ABSENCES 13 Vacation Leave (working days) maximum accrual 14 Sick Leave (calendar days) maximum accrual c 15 Emergency Leave (working days) d 16 Paternity Leave (working days) e 17 Maternity Leave (Normal/Caesarean) f. 18 Special Leave for Women/Solo Parent Leave 19 F. WELLNESS BENEFIT PLAN 20 G. CLUB AFFILIATION (Dues Only) Professional Organization H. COMMUNICATION SUBSIDY 21 Handy Phone and Mobile Subsidy 22 Laptop / Desktop 23 I. SERVICE AWARDS Monetary Award for completing 5 years of service and multiple thereof G. RETIREMENT BENEFITS 24 Normal Retirement (Age 60 with at least 5 years in service) 25 Early Retirement (Age 50 with at least 10 years in service) 26 K. RESIGNATION BENEFITS: Benefit as a percentage of Monthly Basic Salary - At least 5 years but less than 10 years - At least 10 years but less than 15 years - 15 years and above Source: AC Energy. Summary of Benefits and Privileges. Annex B.

Table 19 Training Courses for AC Energy Employees for July-October 2020

No Training Course Date of Training 1 Building Personal Resilience 3 July 2 Advanced Coaching in Times of Uncertainty 8 July 3 Leadership Development 13-14 July 4 Utility and Community Scale Energy Storage (U&CES) Systems 14-17 July 5 Heat Rate Optimization of Coal Power Plants 15-17 July 6 Coal Mining Fundamental 20-22 July 7 Maintenance Planning, Scheduling and Control 20-22 July 8 Placeholder-Psychological First Aid Training 23 July Build Your Resilience in the Face of Crisis 3 August 9 Essentials of HR Management 4-5 August 10 Job Sourcing and HR Upskilling 7 August 11 Influence Others 10 August 12 People Handling Skills 11-12 August 13 Effective Business Writing 12-13 August 14 Psychological First Aid 13 August 15 Unleashing the Strategic Leader 13-14 August 16 Effective Business Writing 18-19 August 17 High Impact Selling 25-26 August 18 Psychological First Aid 26 August 19 Powerful Presentation Skills 3-4 September 20 Leading with Authenticity and Strength 4 September 21 Organizational Development Interventions 9-10 September 22 Powerful Presentation Skills 10 September 23 Virtual Selling Essential Skills in Remote Selling 11 September 24 Competency-based Recruitment Selection 14-15 September 25 Essential Data Privacy Law 16 September 26 Leading Virtual Teams 16 September 28 Training the Trainers 17 September 29 Key Account Management 17 September 29 Psychological First Aid 18 September 30 Leading Virtual Teams 21 September 31 Build High-Performing Virtual Teams 23 September 32 Key Account Management 24 September 33 HR Analytics 28 September 34 Advance Turnaround, Shutdown and Outage Management 26 September- 2 October 35 Microgrids-Understanding and Developing Effective Deployment 29-30 September 36 Virtual Meetings That Engage 30 September 37 Leading With Agility 2 October 38 Unleashing the Strategic Leader 5-6 October 39 High-Impact Selling 5-6 October 40 Managers’ Guide to Sustainable Employee Engagement 7 October 41 Communication with Professional Coaches 7 October 42 Leadership Communication 8 October 43 Unleashing the Strategic Leader 12-13 October 44 High-Impact Selling 12-13 October 45 Preventing Corrosion and Wear Using Surface Engineering 12-13 October 46 Effective Performance Coaching 13-14 October 47 Power Negotiation 15-16 October 48 Leadership Communication 15-16 October 49 Mastering Management 19-21 October 50 Industrial Instrumentation and Modern Control System 19-21 October 51 Effective Performance Coaching 20-21 October 52 Power Negotiation 22-23 October 53 Team Leader Excellence 22-23 October 54 Mastering Management 26-28 October 55 Organizational Change 26-27 October 56 Developing Presence, Confidence and Influence 27-28 October 57 Team Leader Excellence 28-29 October 58 Organizational Change 29-30 October Source: AC Energy, Training Calendar July-October 2020

85. Project’s Compliance to ADB Social Protection Policy. ADB Social Protection Policy requires that activities using its resources must comply with core labor standards and national labor laws (Paragraph 84.ii). Gigasol3 Project’s compliance on the three of the four core labor standards is determined. On freedom from forced labor, the project workers including those of the contractors and subcontractors have freedom of movement. The residents of Palauig are living with their families and outside workers are living in private houses used as staff houses where they can freely go in and out. There has been no case filed against the project on forced labor. On freedom from child labor, the youngest Gigasol 3 Inc. staff is 23 years old. Among the workers of ERS Energy Sdn. Bhd and its subcontractors, the youngest worker is 26 years old while its 21 years old for the workers of JC Electrofields Power Systems Inc. and sub-contractors. On freedom from discrimination at work, the gender and ethnic composition of the project’s workforce indicate compliance. The project and its contractors and subcontractor have women workers composing 1.6 % of the total work force (Table 16). They also employ 14 Aeta workers. On freedom to form and join a union, and to bargain collectively, the eight GIgasol3 project staff are not unionized. The policy of AC Energy on labor union and collective bargaining is yet be seen when its Human Resources Manual of Policies and Procedures and Employee Handbook is released.

86. ADB Social Protection Policy requires that appropriate steps should be taken to ensure that procurement of goods and services, contractors, subcontractors, and consultants, comply with the country’s labor legislation (e.g., minimum wages, safe working conditions, social security contributions, etc.) as well as with the Core Labor Standards (Paragraph 15.iv). AC Energy needs to reflect in its Service Contractor Requisition Policy (HRA-PR 09 1 April 2020) the requirement for its contractors and suppliers to be compliant to national laws.43 The contracts of its contractors and subcontractors also need to be examined if these include provision for this requirement. There are also no procedures for AC Energy to check compliance.

14. Community Health and Safety

87. Philippine Policies. The need to protect community health and safety is provided in the 1987 Constitution. It mandates the State to protect and promote the right to health of the people (Section 15). This mandate is echoed in the Philippines Sanitation Code (Presidential Decree No. 856) which provides that all efforts of public services must be directed to the protection and promotion of health. The DENR Administrative Order No. 03-30 Revised Procedural Manual

43 AC Energy Philippines. 2019 Integrated Report. p.27-30

(August 2007) identifies threat to public health as key issue in projects that must be addressed in the EIA process (Annex 2-7a).44

88. AC Energy Policies. Community health and safety is covered by its ESMS. It provides that E&S assessments will cover environmental, involuntary resettlement, indigenous peoples, Occupational, Health and Safety (OHS), labor and community risks (Section 3). It also cites the IFC Performance Standard on Environmental and Social Sustainability 4 (Community Health and Safety) as best practice and standard (Section 4). The Compliance Mechanism described in Section 10 applies to community health and safety policies.

89. Project Performance. The risk of communicable diseases arising from the interaction of project workers and local communities is well noted.45 The risk is high if no precautions are put in place. The Municipal Health Office (MHO) recorded incidence of three critical infectious diseases in the municipality: Pulmonary Tuberculosis (PTB), Gonorrhea and Syphilis. PTB was reported in 2018 and 2019 (Table 20). In 2020, the MHO reported 105 outstanding cases. The BHS in Salaza reported five outstanding cases although none was reported in Cauyan. There were two cases gonorrhea and syphilis, respectively recorded in the MHO in 2019. Further, the MHO reported incidence of two insect-borne diseases (Dengue and Chikungunya) and one rodent-borne disease (Leptospirosis) in the municipality although no outbreak reportedly occurred.

Table 20 Leading Causes and Rate of Morbidity in the Municipality of Palauig: (Per 10,000 Population)

No Cause 2018 2019 1 Acute Respiratory Infection (ARI) 68.35 30.12 2 Hypertension 38.53 0.80 3 Wound Abscess/Allergy 7.02 0.03 4 Pulmonary Tuberculosis 4.47 0.03 5 Urinary Tract Infection 1.86 0.07 6 Bronchial Asthma 1.81 0.03 7 Skin Diseases/Allergy 0.10 0.01 8 Pneumonia (All Forms) 0.07 0.03 9 Degenerative Joint Disease 0,04 0 10 Bullous Impetigo 0.02 0 11 Bronchitis 0 0.07 12 Acute Watery Diarrhea 0 0.01 13 Gonorrhea 0 0.0005 14 Syphilis 0 0.0005 Source: Palauig Municipal Health Office

90. The exposure of outside project workers to these diseases in the community is high because they are living in rented houses with the community members. Under this arrangement, the project has less control in upholding sanitation standards in the immediate environment outside the housing units compared to the workers camp setting. This arrangement also allows greater interaction between workers and community members. This interaction also happens in

44 DENR Administrative Order No. 2003-30 (Implementing Rules and Regulations for the Philippine Environmental Impact Statement (EIS) System operationalizes the Philippine EIA Law (Presidential Decree No. 1586).

45 World Bank. 2018. ESS4: Community Health and Safety. Guidance Notes for Borrowers for IPF Operation. June. GN5.3 the three makeshift restaurants allowed by the barangay to operate close to the project site. This interaction can serve as pathways for the cross-infection between workers and community members and among workers and community members. Under the Local Government Code (Republic Act No. 7160), the MHO has the responsibility to direct the sanitary inspection of these lodging houses and restaurants (Section 478.vi). But the Paluig Municipality does not have a sanitary inspector to do the task.

91. The interaction between the workers and the community members have been curtailed by the restrictions that the municipal government and the project imposed due to the Covid19 pandemic. These restrictions control the spread of other infectious diseases as well between the workers and the community. The municipality and the barangays have their coordinated Covid19 control protocols which were reportedly prescribed by DOH through the Provincial Health Office (Table 21). The project’s Covid19 control protocol is discussed in the Environmental Audit Report.

Table 21 Steps Taken by the Municipality and Barangays Salaza and Cauyan to Control Covid19 Community Transmission

No Steps Palauig Barangay Barangay Municiplity Salaza Cauyan 1 Health education through house to house visits X X X 2 Coordination with barangay officials for immediate X X X reports of persons under monitoring 3 Giving of medications and vitamins for persons X X under investigations 4 Distribution of supply of alcohol. face masks at the X X checkpoints 5 Assisted in the distribution of food and cash X X assistance from government officials and NGOs 6 Giving of pamphlets regarding COVID-19 by house X X X to house visits 7 Posting of IEC materials in public areas on how to X X prevent further infection of COVID-19 8 Continuous immunization of infants for their routine X X immunization in house to house set up while giving health advocacy regarding COVID-19 9 Preventing overcrowding of people in public places X like the wet market by subdividing it and placed it different designated barangays 10 Palauig PNP provided check points at the borders X during the quarantine 11 Referring suspected cased to Rural Health Unit X 12 Contact tracing X Source: Palauig MHO and Barangay Salaza and Cauyan BHS

92. The municipality of Palauig has very limited medical facilities. It only has one government medical doctor and one private doctor (Table 22). The medical doctor-population ratio is 18,686 people per medical doctor. This ratio indicates that the health services of the municipality is extremely strained considering that the World Health Organization (WHO) recommends a ratio of one doctor per 1000 persons. It only has one private clinic and has no hospital. The medical needs of the project is not to expected add an additional burden to the municipality’s health services due to the following provision in the project site: one clinic, first aid provisions, one nurse, dedicated vehicle for emergency and an arrangement with a hospital in Iba, Zambales to handle its medical needs. However, the the project has no ambulance and the dedicated emergency vehicle is not fitted with emergency provision. The hospital in Zambales in 20 minutes away from the project site.

Table 22 Health Services in Palauig Municipality: 2020

Services Number Government Medical Doctor 1 Private Medical Doctor 1 Private Clinic 1 Government Hospital 0 Government Ambulance 2 Source: MHO

93. The municipality of Palauig has only one fatal vehicular accident in 2019. The traffic load in the road cutting the project site is light based on the video obtained through a drone. The vehicle load that the project will add to the traffic is not expected to increase the incidence of traffic accidents as long as it implements all the standard health and safety measures as well as road safety measures.

94. Project’s Compliance to ADB Safeguard Policies. The ADB 2009 SPS requires the borrower to identify and assess the risks to, and potential impacts on, the safety of affected communities during the design, construction, operation, and decommissioning of the project and to establish preventive measures and plans to address them in a manner commensurate with the identified risks and impacts (Appendix 1 Paragraph 42). The risk of outside housing of workers and makeshift restaurants must be addressed through sanitary inspection to ensure that they comply with the national and local sanitation regulations. The applicable national regulations are contained in Philippine Sanitation Code which provides standards food establishment (Chapter III) and lodging houses (Chapter XIV).

III. CONCLUSION

95. Land Acquisition. The land acquired for the project site is not covered by the ADB Involuntary Resettlement Policy. It was done through willing-buyer-willing seller purchase and expropriation power was not used or intended to be used in case the negotiation would fail. In this case, land acquisition was voluntary being a commercial transaction between two corporate entities. The process complied with all national and local laws and there is no outstanding compliance issue.

96. Indigenous Peoples. The project has no impact on the Aetas whose nearest house to the project site boundary is at least 7.0 km away. No part of the project site is within an area under CADT or CALC or claimed by the Aeta as ancestral territory nor is there any resource within the project site used by them for economic, social, cultural or spiritual purposes. AC Energy ESMS commits to protect indigenous peoples affected by its operation (Section 2.3). It also considers equal opportunity in employment and diversity as a management approach.46 There is no information if the project contractors and sub-contractors have the same non-discriminatory policy on indigenous peoples. But the contractors employ 14 Aeta as workers.

46 AC Energy Philippines. 2019 Integrated Report. p.73.

97. Stakeholder Engagement. There are two requirements in ADB 2009 SPS on meaningful consultation which are not in the AC Energy requirement. One is to do consultation in an atmosphere free of intimidation or coercion. Another is to make consultation gender inclusive and responsive, and tailored to the needs of disadvantaged and vulnerable groups. These requirements are based on Appendix C2 of the ESMS. Nonetheless, the conduct of its community consultation done as part of IEE preparation complied with both requirements. But the documentation which is required in both ADB 2009 SPS and AC Energy ESMS was only partly complied due to the unavailability of meeting transcript. Consequently, there no information showing that stakeholders’ views which were expressed in the meeting were incorporated in the project design and decisions as required by ADB 2009 SPS. The meeting complied with five out of seven ADB 2009 SPS requirements and three of the five AC Energy ESMS requirements.

98. On CSR, AC Energy has assisted local communities in education through teachers training, student work immersion and school rehabilitation as well as in forest protection. But none of these activities were done in communities around GIgasol3 project site. One of its main contractors (EC Electrofields Power System Inc.) conducted three CSR activities: (i) blood donation in the drive sponsored by the DOH, Philippine Red Cross and Palauig Municipal Government, (ii) disinfection of temporary Covid 19 isolation facility of Palauig and coastal cleanup in Barangay Subic, Palauig.

99. Grievance Redress Mechanism. The only complaint that the project received was the restriction of access of five households which was already resolved through the improvement of an existing road. The ESMS GRM process has to provide a fixed timeframe in resolving grievances preferably within 15 calendar days to meet the requirement of promptly addressing the complaint. It also has to include community members - one man and one woman - to meet the requirements of transparency and gender responsiveness. The incorporation of the Barangay Justice System (Katarungan Pambarangay) as provided in the Local Government Code (Section 17.b; 389.b.b; 515 and Chapter 7) as the third tier in its GRM should be considered to enhance cultural appropriateness

100. Gender and Development. AC Energy has no Gender Policy but it considers equal opportunity in employment and diversity as a management approach. It has policies that protect women from sexual harassment, provides women-specific employment benefits and have employed women across the organizational structure. The gap between ADB Gender and Development Policy and AC Energy policy is that gender is not a specific consideration in its ESMS. Further, there are no gender and women-specific its training courses and CSR activities. Gigasol3 CSR activities should be consistent with the Project Gender Categorization indicator ii, wherein ADB funded projects should have CSR programs with substantial activities (at least 25% of the respective CSR program funds) to empower or benefit women in local communities.

101. Labor and Working Conditions. The Gigasol3 Project’s complies with three of the four core labor standards: freedom from forced labor, freedom from child labor and freedom from discrimination at work. But its policy on freedom to form and join a union, and to bargain collectively is not yet clear because Human Resources Manual of Policies and Procedures and Employee Handbook are not yet released. AC Energy’s recruitment, retrenchment and employees’ GRM procedures should also be contained in these documents. The eight GIgasol3 project staff are not unionized.

102. ADB Social Protection Policy requires that appropriate steps should be taken to ensure that procurement of goods and services, contractors, subcontractors, and consultants, comply with the country’s labor legislation (e.g., minimum wages, safe working conditions, social security contributions, etc.) as well as with the Core Labor Standards (Paragraph 15.iv). AC Energy needs to reflect in its Service Contractor Requisition Policy (HRA-PR 09 1 April 2020) the requirement for its contractors and suppliers to be compliant to national laws.47 The contracts of its contractors and subcontractors also need to be examined if these include provision for this requirement. There are also no procedures for AC Energy to check compliance.

103. Community Health and Safety. The project houses its outside project workers in rented houses in the community. There are also three makeshift restaurants at the periphery of the construction site patronized by workers. Both arrangements increase the opportunity for interaction between the workers and community members although the Covid19 restrictions have curbed it. The project on one hand and the municipal and barangay governments on the other have implemented Covid 19 protocol. But such interaction can serve as pathway in disease transmission. Incidence of insect and rodent-borne as well as sexually-transmitted diseases was recorded in the municipality. The incidence of PTB is relatively high. The MOH does not have a sanitary inspector to ensure the compliance of these rented houses and makeshift restaurants to the Philippine Sanitation Code. Nonetheless, the risk that the project will add burden to the municipality’s highly constrained health system and increase the incidence of traffic accidents is low due to the provisions that the project put in place.

IV. CORRECTIVE ACTION PLAN

104. The measures proposed to constitute the corrective action plan are shown in Table 23. These measures are intended to close the gaps identified in complying to applicable ADB policies.

Table 23 Applicable ADB Policies, Gaps in Compliance and Corrective Actions for Gigasol3 Project

No Applicable ADB Gaps in Compliance Corrective Actions Policies 1 The consultation process There no transcript on Improve the documentation of and its results are to be meetings with barangay and meetings by ensuring that documented and reflected municipal officials. Although every meeting must have in the environmental the community meeting recorded minutes which are assessment report done as part of IEE systematically filed as part of (Appendix 1 Paragraph preparation was the project’s ESMS database. 19. SPS). documented, there is no transcript on the discussion 2 Enables the incorporation There is no documentation The minutes of meeting must of all relevant views of on stakeholders’ views show the issues discussed affected people and other which were expressed in the and agreement made stakeholders into decision meetings and were including the actions that the making, such as project incorporated in the project project will take to address the design, mitigation design and decisions issues. measures, the sharing of development benefits and opportunities, and

47 AC Energy Philippines. 2019 Integrated Report. p.27-30

implementation issues (Paragraph 32. SPS) 3 (The GRM) should The resolution of complaint Provide a fixed timeframe in address affected people's has no fixed timeframe resolving grievances concerns and complaints which contravenes the preferably within 15 calendar promptly, using an required promptness. The days and include community understandable and Grievance Committee has members - one man and one transparent process that no mandatory membership woman- to meet the is gender responsive, of women and community requirements of transparency culturally appropriate, and members which undermines and gender responsiveness. It readily accessible to all its gender responsiveness can also make use of the segments of the affected and transparency Barangay Justice System people (Paragraph 59. (Katarungan Pambarangay) SPS). as provided in the Local Government Code (Section 17.b; 389.b.b; 515 and Chapter 7) to enhance cultural appropriateness. 4 To consider gender Gender is not a specific Incorporate gender issues in all aspects of consideration in its ESMS. considerations in ESMS in all ADB operations, Further, there are no gender its aspects (See Table 24). accompanied by efforts to and women-specific training Include women-specific encourage women’s courses and CSR activities training courses and CSR participation in the activities. decision-making process in development activities (Paragraph 78. Gender and Development Framework Policy) 5 In the design and Policy on recruitment, Release the Human formulation of its loans, retrenchment, employees’ Resources Manual of Policies ADB will comply with the GRM and freedom of and Procedures and internationally recognized association and collective Employee Handbook. core labor standards bargaining are not (Paragraph 84.ii Social determined in the HR Protection Policy) Policies 6 Appropriate steps should Service Contractor Include provision in the be taken to ensure that Requisition Policy (HRA-PR Service Contractor procurement of goods and 09 1 April 2020) has no Requisition Policy (HRA-PR services, contractors, provision that contractors 09 1 April 2020) that subcontractors, and and suppliers should be contractors and suppliers consultants, comply with compliant to national laws. should be compliant to the country’s labor The contracts of its national laws. The contracts legislation (e.g., minimum contractors and of its contractors and wages, safe working subcontractors also need to subcontractors have to be conditions, social security be examined if these include examined if these include contributions, etc.) as well provision for this provision for this requirement. as with the Core Labor requirement. There are also Formulate and implement Standards (Paragraph no procedures for AC procedures to check the 15.iv. Social Protection Energy to check contractors’ and suppliers’ Policy). compliance. compliance to national laws. 7 Identify and assess the Outside housing of workers Work with the MHO for the risks to, and potential and makeshift restaurants in conduct of sanitary inspection impacts on, the safety of the periphery of the project of private houses used to affected communities site creates risk of disease accommodate workers as well during the design, transmission between and as the makeshift restaurants construction, operation, among workers and in the periphery of the project and decommissioning of community members. site to ensure that they the project and to comply with the national and establish preventive local sanitation regulations. measures and plans to The applicable national address them in a manner regulations are contained in commensurate with the Philippine Sanitation Code identified risks and which provides standards impacts (Appendix 1 food establishment (Chapter Paragraph 42). III) and lodging houses (Chapter XIV).

Table 24 Provisions in ESMS Where Gender Considerations Will Be Inserted and Type of Insertions

ESMS Section Current Provision Amended or Added Provision

2.3 AC Energy is committed to protecting AC Energy is committed to communities, including indigenous protecting communities and will populations and vulnerable pay particular attention to populations, that are affected by its indigenous populations, women operations. and vulnerable groups that are affected by its operations

2.3 None. To be added as Item 2.3. 8 AC Energy will take measures tailored to the needs of indigenous populations, women and vulnerable groups that are affected by its operations.

3 General E&S assessments will cover E&S assessments will cover Guidelines environmental, involuntary environmental, involuntary Bullet 3 resettlement, indigenous peoples, resettlement, indigenous peoples, Occupational, Health and Safety gender, Occupational, Health and (OHS), labor and community risks. Safety (OHS), labor and community risks.

3 General The E&S risk assessment will include The E&S risk assessment will Guidelines input from affected communities include input from affected Bullet 7 (ACs), and other relevant communities (ACs), and other stakeholders. relevant stakeholders and will ensure women’s participation. The objective of these meetings The objective of these meetings would be to gather more information would be to gather more on the: • location of sensitive information on the: • location of environmental areas or areas of sensitive environmental areas or biodiversity concern, • proximity of areas of biodiversity concern, • communities to the candidate proximity of communities to the development site, • the presence of candidate development site, • indigenous peoples, and • other presence and vulnerability of matters related to social conditions indigenous peoples, • vulnerability of women; and other matters related to social conditions

4 Bullet 5 E&S Consult with workers, managers, Consult with workers, managers, Action Plan experts and external stakeholders, experts and external stakeholders including suppliers and community. with women duly represented, They can offer insight into important including suppliers and community. issues and effective actions. They can offer insight into important issues and effective actions.

5 Types of stakeholders may include: 1. Types of stakeholders may Affected communities 2. Local include: 1. Affected communities 2. community 3. NGOs 4. Activist groups Local community 3. NGOs 4. 5. Media organizations 6. Investors 7. Activist groups 5. Media Employees 8. Contract workers 9. organizations 6. Investors 7. Trade unions/worker associations 10. Employees 8. Contract workers 9. Suppliers/contractors 11. National Trade unions/worker associations Government Agencies 12. Local 10. Suppliers/contractors 11. Government Units 13. Civil Society National Government Agencies 12. Organizations Local Government Units 13. Civil Society Organizations; 14. Women and Their Groups

5 Engage in Enable meaningful participation a. 3. Enable meaningful participation Communication Use culturally appropriate measures a. Use culturally appropriate with Affected to reach them b. Engage with measures to reach them b. Engage Communities stakeholders in their own with stakeholders in their own communities and places where they communities and places where 2.3 feel comfortable c. Provide they feel comfortable c. Provide opportunities for two-way dialogue opportunities for two-way dialogue; d. Provides relevant and adequate information; e. Free of coercion and intimidation; f. Gender inclusive and responsive to the needs of vulnerable groups; and g. Incorporates relevant views to project decision-making 5 Engage in The grievance mechanism should: 1. The grievance mechanism should: Communication Be publicized so people know where 1. Be publicized so people know with Affected to go and whom to approach. 2. where to go and whom to Communities Enable people to contact AC Energy approach. 2. Enable people to either openly or anonymously. 3. contact AC Energy either openly or 3 Establish procedures to register, anonymously. 3. Establish screen, categorize, investigate and procedures to register, screen, determine resolution and redress categorize, investigate and options. 4. Establish a system to determine resolution and redress communicate decisions taken and options. 4. Establish a system to progress on pending actions. 5. communicate decisions taken and Commit to a response time and keep progress on pending actions. 5. to it as this will increase transparency Commit to a response time and and a sense of “fair process.” keep to it as this will increase transparency and a sense of “fair process.”; and 6. gender responsive, culturally appropriate, and readily accessible to all segments of the affected people.

APPENDICES

1. List of Interviewees 2. Guide Questions 3. List of Documents Reviewed 4. Involuntary Resettlement Categorization Form 5. Indigenous Peoples Categorization Form 6. Copy of Deed of Sale 7. Copy of Land Title 8. Photos

APPENDIX 1

List of Interviewees

A. AC ENERGY

Mr. Vincent De Paz, AC Energy Sustainability Manager Mr. Joshua Baquiran, AC Energy Sustainability Officer Ms. Ani Guillermo, AC Energy Project Manager Mr. Mikael Andre Ladiao, AC Energy Stakeholder Engagement Manager Mr. Jonel Elamparo, HSE/Pollution Control Officer Mr. Apolonio Ramirez Jr., Gigasol3 Project Manager

B. ERS Energy Sdn. Bhd. (EPC)

Mr. Isagani Leutrio, Project Manager

C. JC Electrofields Power Systems Inc. (EPC)

Mr. Jimmy San Esteban, Project Manager

D. Municipal Government of Palauig

Ms. Vina Modelo, Municipal Planning and Development Coordinator Dr. Federico Nacin, Municipal Health Officer

E. Barangay Salaza

Ms. Lorna Gloria, Captain Ms. Jhesette Dayrit-Altares, Barangay Nutrition Scholar

F. Barangay Cauyan

Mr. Antonio Asis, Barangay Captain Florence Ruth Oficial, Barangay Health Station Nurse Jhesette Santos, Barangay Health Station, Midwife

G. Aeta Community

Mr. Joe Badar, Chieftain Mr. Manuel Paanan, Chieftain

APPENDIX 2

Guide Questions GUIDE QUESTIONS FOR THE MUNICIPAL PLANNING AND DEVELOPMENT OFFICER

Name: ______Date of Interview: ______

A. Project Location 1. What is the municipal income class of the Palauig? ______2. What is the amount of municipal income in the following years? 2017 ______PHP; 2018______PHP; 2019______PHP 3. What percent of the households in Palauig is classified as living below poverty line? ______% 4. Does the municipal government have any activities aimed at helping the poor? ______If yes, please describe these activities? ______5. What percent of the population of Palauig are Aeta? ______% 6. In what barangays are they residing? ______7. Are there issues in the relationship between the Aeta and the mainstream population? ____If yes, what are these and please explain why these are issues? ______8. Do you know if the Aeta community in Palauig are the facing issues in livelihood and other aspects that are not encountered by the mainstream population? _____ If yes, what are these issues? ______9. Based on your knowledge, was the project site used for any religious ceremony (Christian or non- Christian) before this was acquired by the project? ______If yes, who were the people who participated in the ceremony? ______10. Based on your knowledge, was the project site used for any cultural activities such as social celebrations and festivities before this was acquired by the project? ______If yes, what were these activities? ______Who were the people who participated in the activities? ______11. Based on your knowledge, were there events which are historically important to the people in the municipality which occurred in the project site before this was acquired by the project? ______If yes, what were these events?______12. Based on your knowledge, was the area for the project ever used as graveyard or burial ground before this was acquired by the project?______If yes, how many graves were there ______. From where were the people who were buried in these graves? ______13. Based on your knowledge, are there any sites (e.g., church, chapels, areas for social celebrations and sites considered sacred) which are used for religious or cultural purposes by the people of Palauig which access will be restricted by the establishment of the project? ______If yes, please describe the nature of the restriction? ______14. Based on your knowledge, are there any social services or public facilities (e.g., health center and schools) which access will be restricted by the establishment of the project? ____ If yes, please describe, the nature of the restriction? ______15. What would you consider the main economic problems of the people of Palauig? (You can mention more than one).______16. What activities the municipal government has done to address these economic problems? ______17. Based on your knowledge about the municipality, what would you recommend to address these economic problems?______18. Do you see benefits for the municipal government from this project? ______If yes, what are these benefits (please mention has many as you can. ______19. Do you see benefits for the people of the municipality from this project? ______If yes, what are these benefits (please mention has many as you can.______20. Do you have an estimate of the revenue that the municipal government will earn from this project every year of operation?______If yes, how much? ______PHP

B. Land Acquisition and Resettlement Impacts 1. Were there any municipal ordinances or resolutions which were not followed in the acquisition of the land for project site? ____ If yes, what is this ordinance or resolution and their number? ______What did the municipal government do to ensure compliance? ______2. What is the status of the non-compliance? ______3. Do you have knowledge on how the previous owner of the land acquired it and when? ____ If yes, please describe how the was acquired by the previous owner and when did this happen. ______4. Did the project management consult the municipal government when it acquired the land for the project? ______If yes, please provide the dates and places of the consultation, the issues raised and the agreements made? Consultation Consultation Issues Raised Agreement Made Date Location

5. Did municipal government receive any complaint from the seller of the land when the project acquired it? ______If yes, what was the compliant and how was this resolved? ______6. Did municipal government receive any complaint from the owners of surrounding lands when the project acquired the project site? ______If yes, what was the compliant and how was this resolved? ______. 7. Did municipal government receive any complaint from the community members living close to the land when the project acquired it? ______If yes, what was the compliant and how was this resolved? ______8. Based on your knowledge, has the acquisition of project site posed any impediment to access of farms as well as forest, water bodies and other natural resources used for livelihood? _____ If yes, how is this issue being addressed? ______

C. Indigenous Peoples 1. Does the municipality have ordinances or resolutions aimed at serving the interest of the Aeta? ______If yes, please mention the ordinances or resolutions and the number. ______2. Has the project complied with these ordinance and resolutions? ______If no, what actions did the municipal government take and what is the status of non-compliance? ______3. Has the municipal government received any complaints from Aeta community about the project? ______If yes, what are these complaints? ______. What actions taken by the municipal government to address these complaints? ______. What is the status of the compliant? ______. 4. Based on your knowledge, do the provincial and national government agencies have any activities in Palauig aimed at helping the Aeta in their livelihood? ______If yes, what are these activities and what is the implementing agency? ______

D. Consultation and Stakeholder Engagement

1. When did the municipal government first learned about the project? ______What was the source of information? ______2. After the municipal government first learned about the project, did it get additional or succeeding information? ______If yes, what were the sources of additional or succeeding information? ____ 3. Apart from the consultation meetings on land acquisition mentioned in Section B.3 if any, were there other consultation meetings that the municipal government officials and employees attended? ____ If yes, please describe when and where did these happen and what issues and agreements were made. Consultation Consultation Issues Raised Agreement Made Date Location

4. Do the project and the municipal government have any plan to conduct periodic consultations? ___ If yes, how frequent is the consultation meetings planned______. 5. Does the municipal government have any issue on the amount, type of information that it received from the project? _____ If yes, what are these issues? ______6. What actions do you recommend to resolve the issues? ______7. Apart from the complaints referred to in Section B Items 4, 5 and 6 which referred to land acquisition, did the municipal government receive any other complaint about the project?_____ If yes___, when were these received, what were the complaints, who were the complainants and what is the status of the complaint? Date of the Complaint Type of Complaint Affiliation or Position of Status of the Complaint was received the Complainant

8. How does the municipal government resolve these complaints on the project? Please describe the steps.______9. Do you have any suggestion on how to better manage these complaints in the future? ______If yes, what are these______

E. Gender and Development 1. Does the municipality have ordinances or resolutions aimed at serving the interest of women? ______If yes, please mention the ordinances or resolutions and the number. ______2. Has the project complied with these ordinance and resolutions? ______If no, what actions did the municipal government take and what is the status of non-compliance? 3. Based on your knowledge, do the provincial and national government agencies have any activities in Palauig aimed at helping women in their livelihood? ______If yes, what are these activities and what is the implementing agency? ______4. F. Labor and Social Protection 1. Does the municipality have ordinances or resolutions to prioritize the employment of local labor? ______If yes, please mention the ordinances or resolutions and the number. ______2. Does the municipality have activities aimed at promoting local employment? ______If yes, please mention these activities ______.

G. Community Health and Safety 1. Is the municipal government anticipating the coming of outsiders attracted by the employment and business opportunities generated by the project?______If yes do you anticipate problems created by these outsiders? ______If yes, what are these problems? ______2. Do you have any recommendations to respond to these problems if any? ______If yes, what are these recommendations? ______Others 1. Is there anything else you want to say about the project and its impact? ______If yes, what is this? ______

GUIDE QUESTIONS FOR THE PALAUIG MUNICIPAL HEALTH OFFICER

Name: ______Date of Interview: ______

A. Health Services 1. What are the health services available in the municipality? Please fill in the answer below: Services Number Municipal Health Center Medical Doctor Registered Nurse Midwife Dentist Sanitary Engineer Ambulance Government Hospital Medical Doctor Registered Nurse Dentist Midwife Hospital Bed Ambulance Private Clinics Medical Doctors Registered Nurses Private Hospital Medical Doctors Registered Nurses Midwife Dentist Hospital Beds Ambulance

2. What are the infectious and transmittable diseases with incidence in the municipality? Please put below the number of cases recorded in the Municipal Health Center in 2019 and the actions taken: No Infectious Number of Actions Taken by the Municipal Health Center for Disease Diseases Cases in 2019 Control:

1 Malaria 2 Dengue 3 Hepatitis B 4 Tuberculosis 5 HIV/AIDS 6 Gonorrhea 7 Syphilis

B. Disease Outbreak Management 1. Was there a disease outbreak declared in the municipality in since 2010? ______If yes, what was the disease, what year did this happen, what were the causes and what was done to control the outbreak? (Please fill the answer below) Disease Year of the Outbreak Causes Actions Taken

2. Please list below the steps taken by the municipality to manage the COVID-19 Pandemic in Palauig

C. Community Health and Safety 3. Do you see any health problem that may result from the construction and operation of the project? _____ If yes, what are these problems? ______4. What actions can you recommend to solve these problems? ______5. Is the Municipal Health Office anticipating the coming of outsiders attracted by the employment and business opportunities generated by the project?______If yes do you anticipate health problems created by these outsiders? ______If yes, what are these problems?______6. Do you have any recommendations to respond to these problems if any? ______If yes, what are these recommendations?______

D. Others

Is there anything else you want to say about the project and its impact? ______If yes, what is this?

GUIDE QUESTIONS FOR THE BARANGAY CAPTAIN

Name: ______Date of Interview: ______

A. Location 21. What is the amount of barangay income in the following years? 2017 ______PHP; 2018______PHP; 2019______PHP 22. What are the social services present in your barangay? Please indicate below: Social Services Number Elementary School Number of Teachers Number of Classrooms Number of Students High School Number of Teachers Number of Classrooms Number of Students Barangay Health Center Number of Nurses Number of Midwife Police Station Number of Police staff

23. What percent of the households in the barangay is classified as living below poverty line? ______% 24. Does the barangay have any activities aimed at helping the poor? ______If yes, please describe these activities? ______25. What percent of the population of Barangay Cauyan are Aeta? ______% 26. Are they residing mixed with the residents of other ethnic groups or separate? ______If separate, why is this so? ______27. Are there issues in the relationship between the Aeta and the mainstream population? ____If yes, what are these and please explain why these are issues? ______28. Do you know if the Aeta community in Barangay Cauyan is facing issues in livelihood and other aspects that are not encountered by the mainstream population? _____ If yes, what are these issues? ______29. Based on your knowledge, was the project site used for any religious ceremony (Christian or non- Christian) before this was acquired by the project? ______If yes, who were the people who participated in the ceremony? ______30. Based on your knowledge, was the project site used for any cultural activities such as social celebrations and festivities before this was acquired by the project? ______If yes, what were these activities? ______Who were the people who participated in the activities? ______31. Based on your knowledge, were there events which are historically important to the people in the barangay which occurred in the project site before this was acquired by the project? ______If yes, what were these events?______32. Based on your knowledge, was the area for the project ever used as graveyard or burial ground before this was acquired by the project?______If yes, how many graves were there ______. From where were the people who were buried in these graves? ______33. Based on your knowledge, are there any sites (e.g., church, chapels, areas for social celebrations and sites considered sacred) which are used for religious or cultural purposes by the people of Palauig which access will be restricted by the establishment of the project? ______If yes, please describe the nature of the restriction? ______34. Based on your knowledge, are there any social services or public facilities (e.g., health center and schools) which access will be restricted by the establishment of the project? ____ If yes, please describe, the nature of the restriction? ______35. What would you consider the main economic problems of the people of Barangay Cauyan? (You can mention more than one).______36. What activities the barangay government has done to address these economic problems? ______37. Based on your knowledge about the barangay, what would you recommend to address these economic problems?______38. Do you see benefits for the barangay government from this project? ______If yes, what are these benefits (please mention has many as you can. ______39. Do you see benefits for the people of Barangay Cauyan from this project? ______If yes, what are these benefits (please mention has many as you can.______40. Do you have an estimate of the revenue that the barangay government will earn from this project every year of operation?______If yes, how much? ______PHP B. Land Acquisition and Resettlement Impacts 9. Did the project management consult the barangay government when it acquired the land for the project? ______If yes, please provide the dates and places of the consultation, the issues raised and the agreements made? Consultation Consultation Issues Raised Agreement Made Date Location

10. Did barangay government receive any complaint from the seller of the land when the project acquired it? ______If yes, what was the compliant and how was this resolved? ______11. Did barangay government receive any complaint from the owners of surrounding lands when the project acquired the project site? ______If yes, what was the compliant and how was this resolved? ______12. Did barangay government receive any complaint from the community members living close to the land when the project acquired it? ______If yes, what was the compliant and how was this resolved? ______13. Based on your knowledge, has the acquisition of project site posed any impediment to access of farms as well as forest, water bodies and other natural resources used for livelihood? _____ If yes, how is this issue being addressed? ______

C. Indigenous Peoples 5. Does the barangay have ordinances or resolutions aimed at serving the interest of the Aeta? ______If yes, please mention the ordinances or resolutions and the number. ______6. Has the project complied with these ordinance and resolutions? ______If no, what actions did the barangay government take and what is the status of non-compliance? ______7. Has the barangay government received any complaints from Aeta community about the project? ______If yes, what are these complaints? ______. What actions taken by the municipal government to address these complaints? ______. What is the status of the compliant? ______. 8. Based on your knowledge, do the provincial and national government agencies have any activities in Barangay Cauyan aimed at helping the Aeta in their livelihood? _____ If yes, what are these activities and what is the implementing agency? ______9. D. Consultation and Stakeholder Engagement 10. When did the barangay government first learned about the project? ______What was the source of information? ______11. After the barangay government first learned about the project, did it get additional or succeeding information? ______If yes, what were the sources of the additional or succeeding information? 12. Apart from the consultation meetings on land acquisition mentioned in Section B.3 if any, were there other consultation meetings that the barangay government officials and employees attended? ____ If yes, please describe when and where did these happen and what issues and agreements were made. Consultation Consultation Issues Raised Agreement Made Date Location

13. Do the project and the barangay government have any plan to conduct periodic consultations? ___ If yes, how frequent is the consultation meetings planned______. 14. Does the barangay government have any issue on the amount, type of information that it received from the project? _____ If yes, what are these issues? ______15. What actions do you recommend to resolve the issues? ______16. Apart from the complaints referred to in Section B Items 4, 5 and 6 which referred to land acquisition, did the barangay government receive any other complaint about the project?_____ If yes___, when were these received, what were the complaints, who were the complainants and what is the status of the complaint? Date of the Complaint Type of Complaint Affiliation or Position of Status of the Complaint was received the Complainant

17. How does the barangay government resolve these complaints on the project? Please describe the steps.______18. Do you have any suggestion on how to better manage these complaints in the future? ______If yes, what are these______

E. Gender and Development 5. Does the barangay have ordinances or resolutions aimed at serving the interest of women? ______If yes, please mention the ordinances or resolutions and the number.______6. Has the project complied with these ordinance and resolutions? ______If no, what actions did the barangay government take and what is the status of non-compliance? 7. Based on your knowledge, do the provincial and national government agencies have any activities in Barangay Cauyan aimed at helping women in their livelihood? ______If yes, what are these activities and what is the implementing agency? ______

F. Labor and Social Protection 3. Does the barangay government have ordinances or resolutions to prioritize the employment of local labor? ______If yes, please mention the ordinances or resolutions and the number. 4. Does the barangay have activities aimed at promoting local employment? ______If yes, please mention these activities ______. G. Community Health and Safety 7. Is the barangay government anticipating the coming of outsiders attracted by the employment and business opportunities generated by the project?______If yes do you anticipate problems created by these outsiders? ______If yes, what are these problems? ______8. Do you have any recommendations to respond to these problems if any? ______If yes, what are these recommendations? ______H. Others 2. Is there anything else you want to say about the project and its impact? ______If yes, what is this? ______

GUIDE QUESTIONS FOR THE BARANGAY HEALTH STATION NURSE

Name: ______Date of Interview: ______

A. Health Services 3. What are the health services available in the barangay health center? Please fill in the answer below: Services Number Barangay Health Center Building Registered Nurse Midwife In-patients Beds

4. What are the infectious and transmittable diseases with incidence in the barangay? Please put below the number of cases recorded in the Barangay Health Center in 2019 and the actions taken: No Infectious Number of Actions Taken by the Municipal Health Center for Disease Diseases Cases in 2019 Control:

1 Malaria 2 Dengue 3 Hepatitis B 4 Tuberculosis 5 HIV/AIDS 6 Gonorrhea 7 Syphilis

B. Disease Outbreak Management 3. Was there a disease outbreak declared in the barangay since 2010? ______If yes, what was the disease, what year did this happen, what were the causes and what was done to control the outbreak? (Please fill the answer below) Disease Year of the Outbreak Causes Actions Taken

4. Please list below the steps taken by the barangay to manage the COVID-19 Pandemic. No Steps Taken to Manage COVID-19 1 2 3

C. Community Health and Safety 9. Do you see any health problem that may result from the construction and operation of the project? _____ If yes, what are these problems? ______10. What actions can you recommend to solve these problems? ______11. Is the Barangay Health Officer anticipating the coming of outsiders attracted by the employment and business opportunities generated by the project?______If yes do you anticipate health problems created by these outsiders? ______If yes, what are these problems? ______12. Do you have any recommendations to respond to these problems if any? ______If yes, what are these recommendations?______

D. Others Is there anything else you want to say about the project and its impact? ______If yes, what is this?

GUIDE QUESTIONS FOR THE AETA LEADERS Names and Position: ______Date of Interview: ______

A. Profile of Indigenous Peoples (Aeta) 1. As a leader of the Aeta, please describe how the leaders like you are selected by the group. ______2. As a leader of the Aeta, what are your duties (please many as many as you can? _____ 3. Is it possible that an Aeta leader will lose his position of leadership? ______If yes, what will be the reason? ______4. How many kilometers is the nearest Aeta house or settlement from the project site? ______km 5. How many kilometers is the nearest Aeta farm from the project site? ______km 6. How many kilometers is the nearest Aeta settlement from the project site? ______km 7. Please indicate below the number of kilometers are the following social services from your Aeta settlement: Social Services Distance From the Aeta Settlement in Km Elementary School High School Barangay Health Center Police Station Road

8. Based on your knowledge, what year did the Aeta first settle in this area close to the project site? _____ 9. Based on knowledge, why did the Aeta settle in this area? ______10. From where were the Aetas who settled in this area? Please name the barangay and the municipality? __ 11. How many Aeta people are currently in this settlement? ______. 12. How many houses are there in this settlement? ______. 13. What are the livelihood and subsistence activities of the Aeta people in the settlement? ______14. What natural resources do you use to make your livelihood and get your subsistence? ______15. Where are the lands you use for livelihood located (please mention the barangay and municipality)? ____ 16. What are the biggest problems they encounter in their livelihood activities? ______17. Do you know if the Aeta community is facing issues in livelihood and other aspects that are not encountered by the mainstream population? _____ If yes, what are these issues?______18. What solutions can you suggest for these problems and issues? ______19. Do the Aeta residents of the settlement have dealings with the non-Aeta people? ______If yes, what are the activities where they deal with non-Aeta people? (please mention as many as you can) ______20. Did the Aeta residents encounter problems in these dealings? ______If yes, what are these problems? _ 21. What are your suggested solutions to these problems? ______22. Since the Aeta residents in your settlement have been exposed to the non-Aetas, are there non-Aeta beliefs and practices that the Aeta residents have adopted as a result of this exposure? ______If yes, what are these beliefs and practices? (please mention as many as you can). ______23. Since the Aeta residents in your settlement have been exposed to the non-Aetas, are there traditional Aeta beliefs and practices that has been lost as a result? ______If yes, what are these belief and practices? (please mention as many as you can). ______24. Do you anticipate problems that may arise as result of the project? _____ If yes, what are these problems? ______25. What solutions do you suggest to solve these problems resulting from the project? ______you anticipate benefits for the Aeta settlement from the project? ______If yes, what are these benefits? _ 26. Are there on-going programs in the Aeta settlement aimed at improving the living conditions of the Aetas? _____ if yes, what are these programs and who are sponsoring these? ______27. Has the Aeta settlement or any of its members received any assistance from the project? ____ if yes, what is this assistance? (mention as many as you can)? ______28. Do you have any recommendation on the type of assistance that the project may provide in case this is given to the Aeta Settlement? _____If yes, what are your recommendations? ______

B. Scope of Land Acquisition/Leasing and Resettlement Impacts 41. Based on your knowledge, is the project site part of your ancestral domain whether under CADC, CALT or claim. 42. Do you know if any member of the Aeta community has participated in a consultation meeting on the acquisition of the project site? ______If yes, how many meetings did they participated? ______43. Based on your knowledge, was the project site used by the members of Aeta community for any religious ceremony before this was acquired by the project? ______If yes, what was the purpose of this ceremony? ______44. Based on your knowledge, did members of the Aeta use the project site for any cultural activities such as social celebrations and festivities before this was acquired by the project? ______If yes, what were these activities? ______45. Based on your knowledge, were there events which are historically important to the Aetas which occurred in the project site before this was acquired by the project? ______If yes, what were these events?__ 46. Based on your knowledge, was the area for the project ever used as graveyard or burial ground by Aetas before this was acquired by the project?______If yes, how many graves were there ______. 47. Based on your knowledge, are there any sites (e.g., sites considered sacred) which are used for religious or cultural purposes by the Aeta which access will be restricted by the establishment of the project? ______If yes, please describe the nature of the restriction? ______48. Based on your knowledge, are there any social services or public facilities (e.g., health center and schools) which access will be restricted by the establishment of the project? ____ If yes, please describe, the nature of the restriction? ______. 49. Based on your knowledge, has the acquisition of project site posed any impediment to access of farms as well as forest, water bodies and other natural resources used for livelihood? _____ If yes, how is this issue being addressed? ______

C. Consultation and Stakeholder Engagement. 19. When did you first learned about the project? ______What was the source of information? ______20. After you first learned about the project, did you get additional or succeeding information? ______If yes, what were sources of the additional or succeeding information?______21. Apart from the consultation meetings on land acquisition mentioned in Section B if any, were there other consultation meetings that the Aetas in your settlement attended? ____ If yes, please describe when and where did these happen and what issues and agreements were made. Consultation Consultation Issues Raised Agreement Made Date Location

22. Do the project and the Aeta Leaders have any plan to conduct periodic consultations? ___ If yes, how frequent is the consultation meetings planned______. 23. Do you have any issue on the amount, type of information that it received from the project? _____ If yes, what are these issues? ______24. What actions do you recommend to resolve the issues? ______25. Did you receive any complaint about the project from other Aetas?_____ If yes___, when were these received, what were the complaints, who were the complainants and what is the status of the complaint? Date of the Complaint Type of Complaint Affiliation or Position of Status of the Complaint was received the Complainant

26. How did you deal with these complaints on the project? Please describe the steps.______27. Do you have any suggestion on how to better manage these complaints in the future? ______If yes, what are these______28. Did you receive information on what to do if you have complaints about the project, _____ If yes, please describe the information that you receive.______29. Do you have suggestions on how to better handle complaints about the project should any arise from your community members? _____ If yes, what is are these suggestions? ______30. D. Labor and Social Protection 5. Based on your knowledge, are there any Aeta who are employed by the project? ____ If yes, how many? 6. Based on your knowledge, are there any Aeta whose livelihood is benefitted by the project? _____If yes, what is this livelihood? ______What is the benefit that is obtained? ______

E. Community Health and Safety 13. Is the Aeta community anticipating the coming of outsiders into its area attracted by the employment and business opportunities generated by the project?______If yes do you anticipate problems created by these outsiders? ______If yes, what are these problems? ______. 14. Do you have any recommendations to respond to these problems if any? ______If yes, what are these recommendations? ______

F. Others 3. Is there anything else you want to say about the project and its impact? ______If yes, what is this? ______

APPENDIX 3 List of Documents Reviewed A. AC Energy

2019 Integrated Report (2 April 2020) Code of Conduct and Ethics (11 June 2020) Corporate Disclosures Procedures Manual (8 August 2017), Phinma Document Corporate Governance and Related Party Transaction Committee Charter (8 August 2017) Phinma Document Deed of Absolute Sale Between Crismin Realty Corporation and AC Energy (Date November 5, 2019) Environmental and Social Management System (27 February 2019 Gigasol3 Employee Profile (Undated) Initial Environmental Examination for Gigasol3 Solar Farm Project. Initial Draft. (February 2020). Prepared by LCI Envi Corporation Integrated Annual Corporate Annual Report (31 December 2019) Land Title Probationary Employment Contract (Undated) Redress of Community Grievance Policy. Draft.(Undated). Revised Corporate Governance Manual (16 October 2019) Schedule of Benefits Annex B (Undated) Service Contractor Requisition Policy (HRA-PR 09) (1 April 2020). Summary of Benefits and Privileges. Annex B (Undated) Table of Offenses (HR-1A_Schedule 1) (Undated) Training Calendar (July-October 2020) Whistleblowing and Non-Retaliation Policy (Undated), Phinma Document

B. EC Electrofields Power System Inc.

Local Community Program (Undated)

C. Asian Development Bank Indigenous Peoples Safeguards: A Planning and Implementation Good Practice Sourcebook (2013) Operational Manual (OM) Section Fi/BP (1 October 2013) Policy on Gender and Development (May 1998) Safeguard Policy Statement (2009) Social Protection Policy (August 2001) Access to Information Policy (September 2018)

D. Philippine Laws and Plans

1987 Constitution Allocation of DECS Budget for Capital Outlay Act (Republic Act 7880). Anti-sexual Harassment Act (Republic Act 7877) Civil Code of the Philippines (Republic Act No. 386) Environmental Impact Statement (EIS) System Law (Presidential Decree No. 1586). Guidelines on the Allocation/Deployment of New Teaching, Teaching-Related and Non-Teaching Position (Department of Education Order No 77 Series 2010). Implementing Rules and Regulations (IRR) for the Philippine Environmental Impact Statement (EIS) System (DENR Administrative Order No. 2003-30) Indigenous Peoples’ Rights Act (Republic Act No. 8371). Labor Code of the Philippines (Presidential Decree No.442) Local Government Code (Republic Act No. 7160) Magna Charta of Women (Republic Act No. 9710). Prohibition on Discrimination Against Women on Terms of Employment (Republic Act 6725) Public Land Act (Commonwealth Act No. 141) Revised Procedural Manual for DENR Administrative Order No. 2003-30 Philippine Plan for Gender- Responsive Development (1995-2025). Rules and Regulations Implementing Republic Act No. 7638 (Energy Regulation No. 1-94) Sanitation Code of the Philippines (Presidential Decree No 856)

E. Government Documents

National Statistics Office. 2003. 2000 Census of Population and Housing, Report No 2. Volume 1. Demographic and Housing Characteristics. Manila. National Statistics Office. 2012. 2010 Census of Population and Housing, Report No 1-E. Region III-Central Luzon. Population by Province, City/Municipality and Barangay. Manila. April National Statistics Authority. 2013. 2010 Census of Population and Housing. Report No. 2A. Demographic and Housing Characteristics. Zambales. April. Philippine Statistics Authority. 2017. 2015 Census of Population. Demographic and Socioeconomic Characteristics. Report No. 2. June Paluig Municipal Health Office. 2019. Municipal Health Profile.

F. Other Documents

Besas, D. 1994. The Rehabilitation of Mt Pinatubo Victims: A Case Study of Organizational Coordination in Dampay Resettlement Area, Barangay Salaza, Palauig, Zambales. Master’s Thesis in Social Work. University of the Philippines Diliman College of Social Work and Community Development. 17 April. Beyer, O.H. 1947. Outline Review of Philippine Archeology by Island and Provinces. The Philippine Journal of Science. 77:3-4. July-August Blench, R. 2016. Splitting Up Proto-Malayo-Polynesian: New Models of Dispersal from Taiwan. In: Austronesian Diaspora: A New Perspective. B. Prasetyo and Others (eds). Yogyakarta: Gadjah Mada University Press. Carino, J. 2012. Country Technical Notes on Indigenous Peoples’ Issues. Republic of the Philippines. International Fund for Agricultural Development (IFAD). November 2012 Dayrit, M. and others. 2018. The Philippine Health System Review: Health System in Transition. Vol 8. No 2. New Delhi: World Health Organization Regional Office for South-East Asia Fox R. 1952. The Pinatubo Negritos: Their Useful Plants and Material Culture. The Philippine Journal Of Science. 81:3-4. September-December Jinam, T. A. and Others. 2017. Discerning the Origins of Negritos, First Sundaland People: Deep Divergence and Archaic Admixture. Genome Biology and Evolution. 9 (8) August. pp 2013-2022. Jocano, F.L. 1998. Filipino Indigenous Ethnic Communities: Pattens, Variations and Typologies. Punlad Research House. Kreuzer, P. 2012. Mafia Style Domination: The Philippine Province of Pampanga. Report No. 114. Peace Research Institute. Kuestner, A. 2016 Nepomuceno Legacy: The Construction of Elite Heritage. Master’s Thesis for Asian Studies. University of Hawaii at Manoa. December. International Finance Corporation (IFC). 2012. Performance Standard on Environmental and Social Sustainability 4 (Community Health and Safety) and 7 (Indigenous Peoples). January Reed, W.A. 1904. Negritos of Zambales. Manila: Bureau of Printing. Reid, L.A. 2013. Who Are the Philippine Negritos? Evidence from Language. Human Biology. 85:15 pp. 329-330 Tenazas, R.C.P. 1974. Map of Better-Known Cultural Minorities of the Philippines. Philippine Quarterly or Culture and Society. 2: 1-2. March-June pp. 3-4: World Bank. 2018. ESS4: Community Health and Safety. Guidance Notes for Borrowers for IPF Operation. June. GN5.3

G. Websites https://www.acenergy.com.ph/about/ http://www.jcelectrofields.biz/AboutUs https://www.ers.my/about-ers-energy/ https://psa.gov.ph/classification/psoc/?q=psoc/major#:~:text=Tasks%20performed%20by%20w orkers%20in,in%20food%20prepartation%3B%20delivering%20messages https://psa.gov.ph/content/psa-releases-2015-municipal-and-city-level-poverty-estimates https://web.archive.org/web/20101113184319/http://www.nscb.gov.ph/activestats/psgc/articles/ DepOrder Reclass.pdf https://www.infobel.com/en/philippines/crismin_realty_corp/angeles_city/PH100103072/busines sdetails.aspx https://newsinfo.inquirer.net/883787/the-boy-who-started-a-university https://openjicareport.jica.go.jp/pdf/11063377_02.pdf https://www.ilo.org/dyn/normlex/en/f?p=NORMLEXPUB:11200:0::NO::P11200_ COUNTRY_ID:102970

APPENDIX 4 INVOLUNTARY RESETTLEMENT IMPACT CATEGORIZATION

Date: 3 November 2020 A. Instructions (i) Please complete the form and indicate the involuntary resettlement category of the project. (ii) In addition, please indicate in the comments section if the project is highly complex and sensitive (HCS). HCS projects are a subset of category A projects that ADB deems to be highly risky or contentious or involve serious and multidimensional and generally interrelated potential social and/or environmental impacts. B. Involuntary Resettlement Category Category C. The 58-hectare project site is part of the 64-hectare block of land purchased through commercial transaction between two corporate entities. The purchase was under a willing-buyer- willing-seller arrangement. It did not involve expropriation and expropriation could not be resorted if the negotiation for the purchase failed. The land did not have tenants and free users. It was never used by any group for social and cultural purposes neither it has historical or spiritual significance to anybody. The development of the site closed a makeshift road restricting the access of five households to their farm. But a government road which was impassable by wheeled vehicle was improved by the project restoring access.

Involuntary Resettlement Impact Categorization Checklist

Probable Involuntary Resettlement Effects Not Yes No Remarks Known Involuntary Acquisition of Land X A privately-used land of 64 ha was 1. Will there be land acquisition? acquired through under willing-seller- wiling-buyer arrangement. X The site was purchased and 2. Is the site for land acquisition known? construction of facilities is 44% complete.

3. Is the ownership status and current usage of land to be X The land was a titled private property acquired known? of Crismin Realty Corporation and was used to grow tree crops and cattle 4. Will easement be utilized within an existing Right of Way X No easement will be used as ROW (ROW)?

5. Will there be loss of shelter and residential land due to land X The land was not used for residence acquisition? and had no structure of any kind.

6. Will there be loss of agricultural and other productive assets X Natural and crop trees well be lost but due to land acquisition? these were paid as part of the land purchase. 7. Will there be losses of crops, trees, and fixed assets due to X Please see Item 5 and 6 land acquisition?

8. Will there be loss of businesses or enterprises due to land X None acquisition?

X An undetermined number of farm workers who lost their jobs were 9. Will there be loss of income sources and means of livelihoods covered by the retrenchment due to land acquisition? provisions of the Philippine Labor Code (Article 28). Some were absorbed by the project Involuntary restrictions on land use or on access to legally designated parks and protected areas X The land did not have natural 10. Will people lose access to natural resources, communal resources used by people apart from facilities and services? the owner and did have communal facilities and services. 11. If land use is changed, will it have an adverse impact on X None social and economic activities?

12. Will access to land and resources owned communally or by X Please see Item 10. the state be restricted?

Information on Displaced Persons:

Any estimate of the likely number of persons that will be displaced by the Project? [ ] No [X] Yes If yes, approximately how many? Zero

Are any of them poor, female-heads of households, or vulnerable to poverty risks? [X ] No [ ] Yes Are any displaced persons from indigenous or ethnic minority groups? [ X ] No [ ] Yes

Note: The project team may attach additional information on the project, as necessary.

APPENDIX 5 INDIGENOUS PEOPLES IMPACT CATEGORIZATION Date: 3 November 2020 A. Instructions (i) Please complete the form and indicate the involuntary resettlement category of the project (ii) In addition, please indicate in the comments section if the project is highly complex and sensitive (HCS). HCS projects are a subset of category A projects that ADB deems to be highly risky or contentious or involve serious and multidimensional and generally interrelated potential social and/or environmental impacts. B. Indigenous Peoples Category. Category C. No part of the project site is within an area under CADT or CALC or claimed by the Aeta as ancestral territory nor is there any resource within the project site used by them for economic, social, cultural or spiritual purposes. No adverse impact is identified or expected on the dignity, human rights, livelihood systems, or culture of indigenous peoples. Indigenous Peoples Impact Screening Checklist

KEY CONCERNS NOT YES NO Remarks (Please provide elaborations KNOWN on the Remarks column)

A. Indigenous Peoples Identification

X The house owned by an Aeta household closest to the 1. Are there socio-cultural groups present in or use the project site is at least 7.0 km. project area who may be considered as "tribes" (hill tribes, away while a farm is 2.5 km schedules tribes, tribal peoples), "minorities" (ethnic or away. national minorities), or "indigenous communities" in the project area?

2. Are there national or local laws or policies as well as There is no ethnic group anthropological researches/studies that consider these present or using the project groups present in or using the project area as belonging to site. See Item 1 "ethnic minorities", scheduled tribes, tribal peoples, national minorities, or cultural communities?

3. Do such groups self-identify as being part of a distinct See Item 2 social and cultural group?

4. Do such groups maintain collective attachments to See Item 2 distinct habitats or ancestral territories and/or to the natural resources in these habitats and territories?

5. Do such groups maintain cultural, economic, social, and See Item 2 political institutions distinct from the dominant society and culture?

6. Do such groups speak a distinct language or dialect? See Item 2

See Item 2 7. Has such groups been historically, socially and economically marginalized, disempowered, excluded, and/or discriminated against?

KEY CONCERNS NOT YES NO Remarks (Please provide elaborations KNOWN on the Remarks column) 8. Are such groups represented as "Indigenous Peoples" See Item 2 or as "ethnic minorities" or "scheduled tribes" or "tribal populations" in any formal decision-making bodies at the national or local levels?

B. Identification of Potential Impacts

9. Will the project directly or indirectly benefit or target X The project employs 14 Indigenous Peoples? persons who are Aeta

10. Will the project directly or indirectly affect Indigenous X No impact is identified or Peoples' traditional socio-cultural and belief practices? expected (e.g. child-rearing, health, education, arts, and governance)

11. Will the project affect the livelihood systems of X No impact is identified or Indigenous Peoples? (e.g., food production system, expected natural resource management, crafts and trade, employment status)

12. Will the project be in an area (land or territory) X See Item 2 occupied, owned, or used by Indigenous Peoples, and/or claimed as ancestral domain?

C. Identification of Special Requirements

Will the project activities include:

13. Commercial development of the cultural resources and X See Item 2 knowledge of Indigenous Peoples?

14. Physical displacement from traditional or customary X See Item 2 lands?

15. Commercial development of natural resources (such X See Item 2 as minerals, hydrocarbons, forests, water, hunting or fishing grounds) within customary lands under use that would impact the livelihoods or the cultural, ceremonial, spiritual uses that define the identity and community of Indigenous Peoples?

16. Establishing legal recognition of rights to lands and X See Item 2 territories that are traditionally owned or customarily used, occupied or claimed by indigenous peoples ?

17. Acquisition of lands that are traditionally owned or X See Item 2. customarily used, occupied or claimed by indigenous peoples?

APPENDIX 6 Copy of Deed of Sale

APPENDIX 7 Copy of Land Title

APPENDIX 8 Photos

Photo a: Aerial shot of GigaSol 3 (with Geotagging)

five

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Photo b: Aerial shot of GigaSol 3 site (Right of Way Provisions)

Photo c: Agreement between GigaSol 3 and Brgy. Salaza (Right of Way Provisions)

Photo d: GigaSol 3 On-site canteen or mess hall

Photo e: GigaSol 3 Workers toilet (interior and exterior) for Male and Female

Photo f: GigaSol 3 Site Clinic

Photo g: GigaSol 3 Site lay-out