Environmental and Social Management Plan (ESMP) For

ANNEX G: ENVIRONMENTAL AND SOCIAL MANAGEMENT PLAN

Environmental and Social Management Plan (ESMP) for

“Reducing Argentina’s greenhouse gas emissions from the energy sector through the utilization of organic waste for energy generation in agriculture and agroindustries”

The purpose of the ESMP is to ensure that social and environmental impacts, risks and liabilities identified are effectively managed during the phase of procurement of selected bioenergy pilot projects and during the implementation of the technical assistance components of the proposed project. The ESMP specifies the mitigation, adaptation, prevention and management measures and shows how the project will mobilize organizational capacity and resources to account for the factors evaluated in order to implement the compiled measures. The ESMP also shows how mitigation and management measures will be scheduled.

The key objectives of the ESMP are:

 To outline mitigation measures against the possible degradation of the areas;  To enhance positive aspects brought by the project;  To ensure that the project will comply with relevant environmental legislation of Argentina;  To identify roles and responsibilities and the cost involved;  To propose mechanisms for monitoring compliance;  To provide adequate channels of input for the different stakeholders throughout the project activity; and  To establish proven mechanisms to correct/adjust the findings resulting from the monitoring activity and to include the input received throughout the project activity. The ESMP is a live document for project activities that will be updated as and when required. The ESMP acts as a quick guide for contractors and project implementers to enhance positive impacts and eliminate or minimize the occurrence of negative impacts through proposed mitigations measures. The ESMP relies on the following key principles:

Compliance with local, national and international laws

The project will empower individuals and groups, particularly the most marginalized, to realize their rights and interests, and to ensure that they fully participate throughout the development and implementation of projects.

Transparency and inclusivity

The project development team will engage in meaningful and transparent consultation with affected communities, particularly with vulnerable groups, to ensure that they can participate in a free, prior and informed manner in decisions about avoiding or managing environmental or social impacts. The inclusivity will be achieved inter alia via face‐to‐face open stakeholder consultations in the local

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communities, door‐to‐door invitations through the local social networks etc. The project will also aim at achieving at least 40% female representation within capacity building and awareness raising activities.

Systematic assessment and tracking of environmental and social impacts and risks

The project will aim at providing clear and constructive responses to individuals, groups, and communities potentially affected by projects on potential grievances related to the social and environmental performance of the projects, corrects non‐compliance where it has occurred, and shares the results of its review and any actions taken. During project implementation, any changes likely to have negative social and environmental impacts must be communicated to UNIDO prior to implementation. The key risks to be considered and tracked in a systematic way are described in Section 3 and in Section 4 of this ESMP.

Information will be collected on a real‐time and quarterly basis by the project team and will be treated as confidential within the project, to be kept in computerized form and backed‐up by the central UNIDO office. It will be kept for a minimum of 10 years after project completion.

Harmonisation with other projects and programs

The project will aim at maximizing efficiency and minimizing costs in complying with environmental and social safeguards. The project development team will lead discussions at country level to decide on the use of the most appropriate environmental and social safeguards procedures.

Gender equality

The project will identify and integrate the different needs, constraints, contributions and priorities of women and men and where possible, it will aim at enhancing the positive gender impacts of projects by undertaking to develop mitigating measures to reduce any potential gender specific and disproportionate adverse gender impact.

Climate resilience

The project will ensure that supported activities enhance climate resiliency and avoid unwarranted increases in greenhouse gas emissions.

1. Project Description The project falls under Category B for UNIDO projects and is likely to have less adverse impacts, which will be few in number, site‐specific, and few if any will be irreversible. In most cases impacts can be readily minimized by applying appropriate management and mitigation measures or incorporating internationally recognized design criteria and standards.

The project is expected to deliver tangible socio‐economic benefits for Argentina’s energy and agroindustry sectors, as well as for individual businesses and the men, women and their families

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involved. Socio‐economic benefits at national level (country) are achieved as a result of avoided imports of fossil fuels for electricity generation and heat applications. Distributed bioenergy systems, as well as other grid‐connected renewable energy plants can displace thermal power and improve the utilization rate of the transmission network, thereby postponing public investments in infrastructure. The direct replacement of diesel‐based electricity represents very substantial savings of public expenditures given its high marginal costs during peak hours. Moreover, diversification of Argentina’s energy mix enables a more economical operation of the national electricity system in function of fuel market prices and improves the country’s position for negotiating long‐term contracts with foreign suppliers.

The proposed project builds upon on‐going biomass related activities in Argentina and makes a contribution to the use of agricultural (including plantation forestry) and agro‐industrial biomass waste utilization for energy generation within the industry – a field in which UNIDO holds a comparative advantage – while promoting innovative business models and up‐stream uses of biomass.

A range of barriers have been found in place impeding the efficient development and implementation of energy projects based on agricultural and agro‐industrial waste in Argentina. These barriers extend to the policy and institutional framework, and knowledge and technical capacities, and inadequate access to investment capital. The identified weaknesses in the biomass energy value chain give rise to increased project risks, including perceived risks, which can be addressed by demonstration and promotion of best practices and benefits.

At the present stage of market development, there is a great need to mobilize investment capital enabling the industries to benefit from energy generation from agricultural and agro‐industrial organic waste and biomass residues. The utilization of biomass waste by national industries contributes to increasing the reliability of electricity and heat supply for energy consumers and diversification of the national energy matrix. Moreover, by incorporating biomass waste and residues into the industry's value chain, biomass energy generation is supportive to the competitiveness and financial viability of the agro‐ industrial sector and the national economy.

The component 1 of the project will support the adoption of policy, regulation and financial incentives to accelerate the market penetration of bioenergy systems based on agroindustrial residues. The component 2 aims to strengthen knowledge management mechanisms and delivery skills for project development, through the operationalization of a national Bioenergy Network under the Ministry of Agroindustry. The component 3 will demonstrate technical and economic feasibility of bioenergy projects based on agroindustrial residues and will also develop a project portfolio for upscaling of investment.

The selected demonstration pilots will be ranked in terms of technical and economic feasibility, socio‐ economic and environmental criteria, and shall be representative for the bioenergy portfolio in terms of size, geographical coverage and technology, applied business models and energy end‐use. These demonstration projects will involve technologies for organic waste collection, technologies for biogas productions (covered lagoons, biodigesters), technologies for electricity generation (internal combustion

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engines, gas turbines), technologies for thermal energy production (biomass boilers), technologies for cogeneration of heat and power, technologies for energy storage.

During the completion process of the portfolio of pilot projects, it will be the responsibility of the selected executing partners to ensure compliance with national environmental and social standards. For each identified demonstration project, an analysis and mitigation plan shall be prepared.

The identified sectors are geographically concentrated in two regions of Argentina (Northeast and Center) comprising the following six provinces: Corrientes, Misiones, Entre Rios, Province of Buenos Aires, Santa Fe, and Cordoba.

The potential negative environmental and social impacts identified in the ESMP are localized and placed in time with the possibility of mitigation actions. The projected environmental and social risks and proposed mitigation measures for the various stages of the project are presented in Section 3.

1.1 Project intervention area

Corrientes: It is in the northeast of Argentina, in the Mesopotamia region. As part of the subtropical area of Mesopotamia, the province has heavy rains and high temperatures with little daily and seasonal variation and no dry season.

Misiones: It is located in the northeast of the country in the Mesopotamia region. The subtropical climate has no dry season, which makes Misiones one of the most humid provinces in Argentina.

Entre Ríos: It is a central province of Argentina, located in the Mesopotamia region. The weather varies from subtropical in the north to temperate towards the Pampas

Buenos Aires: It is located in the central‐east of the country and is part of the Pampas. The weather of the province is strongly influenced by the ocean. Humidity is high and precipitation is abundant and distributed over the year.

Santa Fe: It is located in the center‐east of the country. Summers are hot and humid throughout the province.

Córdoba: It is located just north of the geographical center of the nation. Weather conditions are different depending on the region. The province has generally warm summers and cool winters to temperate by region.

1.1.1 Environment a. Geological and soil formations

Corrientes: The area consists mainly of lowlands, with the highest points in the east. To the west, a series of descending platforms go down to the Paraná River. The Corrientes province is a basement with a structural high, the Dorsal Asunción‐Rio Grande, where the Guaraní Aquifer System and the basaltic

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layer are thinner and the Mesozoic sediments rise near the surface. It is an area prone to local recharge and regional discharge of the Guaraní Aquifer System. Corrientes has been identified as an important depocenter with at least 3500 m of sedimentary and volcano‐sedimentary deposits that suggest the existence of significant pre‐carboniferous sediment units associated to ancient extensional structures of the early Paleozoic. The Iberá Wetlands, an area of lagoons and swamps, is a vast depression from volcanic flow, covered later with fluvial sediments. Red and sandy soils are found in the area.

Misiones: The area of Misiones is mostly a basalt continuation of the Paraná Plateau of Brazil, lying at elevations of 200 to 800 metres. The rocks contain significant quantities of iron which forms a part of the soil. At the center of the plateau rises the Sierra de Misiones, its highest peak, 843 m, near Bernardo de Irigoyen, in the Cerro Rincón. The humid and verdant area of north‐east Argentina provides fast decomposition of organic matter and gives the soil only a thin fertile layer that can easily be washed away.

Entre Ríos: The land has a flat relief, with hills some 100 meters in height. There are two main systems of low hills, the Cuchilla de Montiel in the west and the Cuchilla Grande in the east, which are separated by the Gualeguay River. The area is crisscrossed by rivers with soft undulations of the lomadas entrerrianas hills, also called blades. By the central valley between the two blades runs the Gualeguay River, which divides the province into two parts. Entre Rios has 5 types of soils: Mollisol on the coast of Paraná; Vertisol in the north; Alfisol in the areas of Feliciano, Federal, La Paz, Paraná, and Villaguay Tala; Entisol in the northeast, in a strip parallel to the Uruguay River; and Inceptisol in the valleys of the rivers Gualeguay, Gualeguaychú and Feliciano.

Buenos Aires: The landscape is mainly flat, with two low mountain ranges: Sierra de la Ventana and Sierra de Tandil. The highest point is Cerro Tres Picos (1,239m). Vertisol soil is found in the coastal area of Buenos Aires province at Samborombón.

Santa Fe: Most of the province consists of green flatlands, part of the humid Pampas, bordering in the north with the Gran Chaco region. There are low sierras to the west. The Ituzaingó Formation which is a geological formation consisting mostly of fine to medium sandstone is located in the province of Santa Fe. The highest point of the province is located in the town of Labordeboy, southwest of the province. Alfisol soil is found in the north and Mollisol is typically for the southern part of the province. Entisol is mainly located around the Parana River, which divides the province of Santa Fe and Corrientes. 70% of the provincial area is black or brown mollisol soils which have evolved from mineral sediments.

Córdoba: Córdoba has two distinct areas: The Plain Pampeana in the east and north, and the Sierras Pampeanas in the northwestern part. The soil of the humid pampas is composed of humus, sediments carried by winds and sediment carried by rivers. It is formed by the decomposition of plant and animal remains. It is ideal for developing crops, because it retains and conserves moisture. In the dry pampa, however, the soil is clayey, sandy and saline. In general the surface is flat, but in the southwest, dunes are constantly moving due to abounding winds.

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b. Hydrography

Surface water

Corrientes: The province is surrounded by the Uruguay River to the east, and the Paraná River to the northwest. The low shore of the Paraná produces frequent flooding. Therefore a protective system with barriers has been constructed. The province is situated in the Iberá Wetlands, which are of pluvial origin, having a total area of 15,000–20,000 km2. Part of the wetland is included within a provincial protected area, the Iberá Provincial Reserve and there are ongoing plans to further transfer its protection status to a national park. The Iberá Wetlands are one of the most important fresh water reservoirs in the continent and the entrance to the Guaraní Aquifer. Water resources are exploited for power generation in the hydroelectric dam Yacyreta.

Misiones: Misiones hydrological landscape is water abundant. The province is embraced by the Paraná River in the west , the Uruguay River in the east, and Iguazú River in the north. Iguazu Falls are waterfalls on the Iguazú River in the northwest corner of the province, near the city of Puerto Iguazú. Misiones shares the falls with the Brazilian state of Paraná. The province of Misiones occupies a central south‐east position with respect to the La Plata River Basin and a central position to the Parana River Basin in which the Guarani Aquifer System is contained. The Uruguay River northeast forms river terraces, today largely submerged by the dam of Salto Grande.

Entre Ríos: The region is traversed by many rivers and streams and surrounded by them in all their borders: the Paraná River to the west; the Uruguay River and the Mocoretá River to the east, and the Guayquiraró River to the north. To the south is the Delta del Paraná with low land and island formation. There are also hot springs along the basin of the Uruguay River, located in cities like Federación, Villa Elisa, and Colón.

Buenos Aires: The Parana River, the Rio de la Plata, and the Salado River have part of their route in the province of Buenos Aires. The Salado River is the longest river in the province (700 km long). The Rio de la Plata Basin encompasses 85% of the country’s surface water resources. A lot of lagoons can be found in the province and almost all of them are due to wind erosion of the plains of the pampas. Water pollution from industrial effluents is a considerable challenge and the risk of continued contamination is very likely in the area. There is a particular focus on the Matanza‐Riachuelo River Basin in Buenos Aires where industries are discharging the majority of the total load of contaminants into the Rio de la Plata.

Santa Fe: The province has numerous streams, rivers and lagoons, as the Parana River, Carcaraña River, Arroyo El Rey, Rio Salado, Rio San Javier, Tapenagá River, and Laguna La Picasa.

Córdoba: Suquía River, Xanaes River, Ctalamochita River, Chocancharava River, and Popopis River have part of their route in Cordoba. The province has numerous dams and reservoirs, as the Lake San Roque, Dique Los Molinos, Piedras Moras, Embalse Río Tercero and Dike Cruz del Eje. These dams are multifunctional and serve as reservoirs of freshwater, produce hydroelectric power, regulate water flows and provide water for irrigation.

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Groundwater

Corrientes: In the project area is one main aquifer present, the Guaraní Aquifer. It is one of the world's largest aquifer systems with a volume of about 40,000 cubic kilometres, a thickness of between 50 metres and 800 metres and a maximum depth of about 1,800 metres. It is estimated to contain about 37,000 cubic kilometres of water.

Misiones: The project area is also localized in the region of the Guaraní Aquifer.

Entre Ríos: The province has a big network of shallow and deep water through aquifers and the water is suitable for immediate consumption. The main aquifer which is present in the area is the Guaraní Aquifer.

Buenos Aires: Exploitable groundwater comes from the Pampeano and Puelches aquifers in the Matanza River basin, Buenos Aires. The depth of the Puelches aquifer ranges from 40 to 120 metres, and it supplies 9,900 cubic metres of water a day. It is located between the Pampeano aquifer, which is closer to the surface, and the deeper Paraná aquifer, whose water is salty and used primarily by industry.

Santa Fe: The Puelche aquifer is located in the western region of Santa Fe Province. The depth of the Puelches aquifer ranges from 40 to 120 metres, and it supplies 9,900 cubic metres of water a day. It is located between the Pampeano aquifer, which is closer to the surface, and the deeper Paraná aquifer, whose water is salty and used primarily by industry.

Córdoba: Cordoba has a significant reserve of groundwater. The groundwater in southern and eastern Cordoba is in large parts not suitable for human consumption. c. Biological environment

Flora

Corrientes: The province is situated in the humid and verdant area in Mesopotamia. The Atlantic Forest extends along the waterways of the Parana River and Uruguay River, where cactus, ferns, lianas and vines exist. In the undergrowth the tacuaruzu bamboo, pindo palm, lapacho, and ibapoy are found. The accumulation of aquatic vegetation causes the formation of dammed, floating islands on which land is deposited

Misiones: Misiones is one of the most bio‐diverse areas in the region. Most of the province is located in the south of the Upper Parana Atlantic Forest, an endangered forest biome of 15 ecoregions. The rain forest occupies 35% of the territory of the province. Among the most important species are tabebuia, jucara, peltophorum dubium, incienso, white laurel, black laurel, white mulberry, urunday, parana pine and rosewood.

Entre Ríos: The vegetation of the province includes species like prosobis, chañar, tala, lapacho and tabebuia. The Paraná Delta White Mountains are formed by other tree species like Humboldt’s willow,

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black poplar and cockspur coral tree. In Colon and Concordia palm trees known as butia yatay grow and the aquatic flora of rivers and lakes includes water sprouts, water lilies and cannas.

Buenos Aires: In this area, there are about 1600 species of major plants, with a large variety of grasses typical of the Pampas and trees like ombú, alder, cockspur coral tree or native willow, as well as rush plants, pampas grass, epiphytes and aquatic plants. Climbing plants and lianas are common in the area, especially in the riverside forest. The province has an immense flat grass prairie called “the Pampas”. This is one of the most endangered ecosystems in Argentina, since the whole area is being used for agriculture and cattle ranching.

Santa Fe: Native conditions of the flora have been changed by the adoption of crops. In the northern region hardwood trees like willow‐leaf red quebrach are forming dense forests. In the southern prairie evergreen trees as ombú grow, as well as laurel, ceibales, prosobis and aguaribaye. Among the herbs of the region are redroot pigweed, chamomile, mallow, verbena, xanthium, hemlock and thistle.

Córdoba: Prosobis, espinillos, chañar, and quebrachos are characteristic in lowland areas. By the rivers and marshes are mainly growing arrows, and cattails.

Fauna

Corrientes: Within the wildlife of Corrientes, the most common mammal is the capybara, the world's largest rodent. One of the endangered species is the marsh deer, as well as the maned wolf. Corrientes is also home to the river otter, wild cat, ocelot, nutria, raccoon, gray brocket, and mountain fox. The most common bird species are kingfishers, herons, spoonbills, ducks, coots, chakars, storks, sandpipers, herdsman, cardinal, swans, large toucan, flamingos, lapwings, woodpeckers, doves, and parakeets. The golden surubí, tarpon, pompano, kingfish, catfish, pacu, and tiger fish are part of the diverse fish fauna of the area.

Misiones: The fauna of the province is rich in variety. Because of the continuing disappearance of the rainforest the number of endangered species is rising. The most common species in the province of Misiones are: maned wolf, ornate hawk‐eagle, crested eagle, water opossum, green‐winged macaw, giant anteater, South American tapir, bush dog, giant otter, and armadillo.

Entre Ríos: The fauna of Entre Rios is naturally protected from predation by rivers surrounding the province, as well as by limits to hunting and fishing of species. Birds in the province are primarily found in lakes, rivers and streams, among them are waders, storks, ibis, spoonbills, kingfisher as well as ducks, cormorants and swans. There are reptiles such as caimans, iguanas and lizards, and snakes as coral snakes, boa constrictors, rattlesnakes and yararás. Among the mammals there are capybaras, ferrets, mountain fox, mice, armadillos, weasels. Fish include surubí, sardines, shad, manduví, and pacu. The construction of the underwater tunnel linking the provinces of Entre Rios and Santa Fe, led to the disappearance of pacu in the area of Riacho Victoria. It is believed that one of the causes is the sensitivity to noises of this species.

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Buenos Aires: La Plata dolphins can be found both in the Atlantic coast and estuary, sometimes even in the waters of the rivers Parana and Uruguay. Common in the area is as well the green turtle and loggerhead turtle. Species such as the jaguar or tiger are almost entirely extinct.

Santa Fe: Deers, skunks, rheas, mule, pampas foxes, puma and pampas cats can be found within the wildlife of the province. Especially along the Parana River are yarará snakes, lizards, frogs and birds like the caracara, partridges, plovers, owls, hummingbirds, great kiskadees and thrushes. The fish fauna of Santa Fe is composed of more than 200 species, among them are surubí, sardines, shad, manduví, and pacu.

Córdoba: The animals which are still living in this area are the caracara, weasels, guinea pigs, the chimango, flamenco, lizard, laucha, the woodpecker, the golden dove, duck, frog, and gray fox. The lagoon of Mar Chiquita is a protected area. In this zoological reserve, the lampalagua, wild cat, goose, mara, martineta, otter, swans, herons, gulls, and flamingos can be found. In the north of the lagoon capybaras live at risk of extinction. In the dry pampa are the endangered goat mountain, gray foxes and skunks at home.

1.1.2. Demographics

Corrientes: The population of Corrientes state is around 1 million and has a total surface of 88 thousand km2. Close to 83% of the population lives in urban areas, the capital and the most populous city is Corrientes with 350 thousand inhabitants. The Guaraní indigenous community composes almost one third of the total population in Corrientes. For this reason the Guaraní language has been recognised as an official language besides Castellano.

Misiones: Misiones has an estimated total number of 1.2 million inhabitants and lies on 30 thousand km2. The capital is Posadas with around 300 thousand people. Misiones is considered to have the largest young population among other states. Almost 40 % of the population lives under the poverty line and 12% of the population belongs to an indigenous group.

Entre Ríos: Entre Ríos has a population of 1.2 million and has a surface of 78 thousand km2. The state is decentralized, around 83% of the population lives in one of the ten urbanized areas. The capital is Paraná and its number of inhabitants is around 300 thousand.

Buenos Aires: The province of Buenos Aires has a total population of 16.6 million and lies on 307.5 thousand km2 resulting in the most densely populated state of Argentina. The capital is La Plata with 800 thousand inhabitants. 96.4% of the population lives in urban areas, mostly in the north‐east of the province in the so called “Gran Buenos Aires” metropolitan area.

Santa Fe: Santa Fe’s population is around 3.2 million and has a total surface of 133 thousand km2. The biggest city is Rosario with almost 2 million inhabitants and the capital is Santa Fe de la Vera Cruz with 480 thousand people. At least 20 different indigenous communities are present in this province; the most relevant ones are the Toba and Mocoví tribes.

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Córdoba: The population of the province Córdoba is 3.3 million and lies on 165 thousand km2. Over one third of the total population lives in the capital i.e. in the city of Córdoba. 88% of the population lives in urbanized areas.

1.1.3 Local economies

Corrientes: Agriculture is still one of the main activities with the focus being on sheep and cattle livestock. The province is also centred on the cultivation and processing of citrus fruits, and the cultivation of rice, tea, yerba mate, and cotton.

Misiones: Agriculture makes an important contribution to the population’s income. Especially the cultivation of yerba mate has been a long‐term main source. Misiones is Argentina's leading producer in tea and citrus fruit, and produces as well tobacco, sugar cane, rice, coffee, cocoa and coconut. Forestry production is primarily situated in the northwest of Misiones and in the Alto Parana region.

Entre Ríos: The population’s activity is based primarily on agriculture, livestock and tourism and to a small extent on mining and industry. In the agricultural sector, the emphasis is on the cultivation of rice, soybean, wheat, corn, citrus and afforestation of eucalyptus.

Buenos Aires: The province is Argentina's chief agricultural producer. The most important crops include soybean, maize, wheat, and sunflower. More recently, the local population started to produce premium wines in the south of the province.

Santa Fe: It is in an agricultural and livestock area, and has a high industrial development. The province is part of the most fertile region of the country. Santa Fe’s main crops are soybean, sunflower, maize, wheat, and rice. In smaller scale strawberry, honey, wood, and cotton are produced.

Córdoba: Its climate, topography, soil characteristics favours various productive activities such as agriculture, livestock, forestry and mining. These activities are complemented by a major industrial development in the province.

1.1.4 Environmental pressures Rapid urbanization and industrialization as well as an intensification of agriculture and cattle ranching have resulted in a major environmental threat to North‐Eastern Argentina in the last decades, leading to deforestation, biodiversity loss, air and water pollution along with an increase of GHG emissions, land degradation, a fall in pasture quality and pollution. As a result there have been more frequent and extreme floods in the last decade in the region of Pampas. Furthermore, due to continuous population growth, waste generation has increased, demanding adequate waste management to be provided by the government and municipalities. In addition, Argentina faces the issue of increasing energy consumption, limited management capacity of this demand and the inefficient use of non‐renewable resources.

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1.2 Component risks As the pilot projects will be constructed on sites (farms) where large‐scale agricultural activities are already being carried out, the main environmental and social impacts that may arise from these projects are most likely to occur during the construction phase. Potential impacts encompass air pollution and noise caused by the construction equipment, machinery, soil excavation, in addition to the consumption of large amounts of water and high electricity usage. It is expected that these potential impacts will be of a short‐lasting nature i.e. only entail short‐term effects. The environmental risks that may occur during the operational phase are summarized below:

1.2.1 Effluent leakages Feedstock for biogas plants (i.e. animal manure) may contain contaminants such as bacteria, viruses, trace quantities of toxic materials and the like. In the case that a leakage of effluent from pipelines, storage or bioreactors occurs, this may contaminate the biologically active portion of the soil or could reach groundwater or surface water directly.

1.2.2 Gas leakages Chemical emissions to air from cleaning products, building materials, and fuel transfer may reduce local air quality. A minimal amount of pollution may occur from the substrate/feedstock during operations.

1.2.3 Sulphur emissions

Sulphur (SO2) emission may contribute to acid deposition, which can lead to potential changes occurring in soil and water quality. Furthermore, it may affect aquatic ecosystems in rivers and lakes and damage forests, crops and other vegetation. Sulphur is a pollutant and can have a negative impact on human health.

1.2.4 Increase in agricultural activity The expansion of land utilisation either for expansion of the main agricultural activity and/or to cultivate (energy) crops or plantations for energy may lead to encroachments of virgin land, resulting in associated impacts. In addition, it may contribute to soil erosion. Increased demand on crops for energy can influence food prices, leading to negative market distortions and increases in end‐user prices.

1.2.5 Deforestation Wood as a feedstock for bioenergy systems can constitute a threat to existing forests as it may lead to unwarranted logging. A reduction in forest cover has multi‐fold effects; including, negative impacts on people’s livelihoods and biodiversity. Moreover, it can lead to increases in GHG emissions.

1.2.6 Transportation Emissions of nitrogen and sulfur oxides from the combustion of transport fuels used for the transport of biomass and/or fertiliser may reduce local air quality. The pilot projects will mainly use feedstock material produced on‐farm; however, additional environmental impacts may arise from transporting

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supplementary feed to the system. Similarly, fertilizers are likely to have an end‐use close by, however, increased fuel consumption at least to some extent is likely.

2. Operational Safeguards (OS) UNIDO distinguishes between the following operational safeguards:

OS 1: Environmental and Social Assessment OS 2: Protection of Natural Habitats OS 3: Involuntary Resettlement OS 4: Indigenous People OS 5: Pest Management OS 6: Physical Cultural Resources OS 7: Safety of Dams

Below, each OS is analysed in terms of its application in the country:

OS 1: Environmental and Social Assessment

For each pilot project a health risk for the population related to the quantity and quality of the effluents, emissions or waste produced should be conducted. In the area of influence, the population that could be affected by the atmospheric pollutants released in each stage of the project should be identified. The energy generation through biomass is generally responsible for odours. Because of this, a map with the potential sources and receptors of them has to be prepared, highlighting distances and landforms that impact in their propagation.

OS 2: Protection of Natural Habitats

Although with different levels of diversity and significance as it is described in the regional table below, each province has natural habits to be protected. So it will be essential to assess whether the project produces negative effects over the quantity and quality of the natural resources, namely the soil, the water and the air. For doing this it will be necessary:

 To assess the differences between the levels of noise of the project and the surroundings. The native wildlife that uses the place for nesting, reproduction and feeding should be specially considered. To evaluate the effect of the use of energy during each project phase on the wildlife and the soil or potential geologic fault that could interfere in the vibration propagation.  To identify the wildlife wealth, as well as its quantity and mobility, of the place and surroundings of the project. If the mobility of the wildlife is low, environmental management measures with the aim of protecting these species should be identified, especially for the activities of land preparation.  To characterize the natural flora of the place, its wealth and quantity. It is also important to identify the ecosystems that build up the flora and wildlife, like forests, and to assess the proximity to wetlands specially taking into account the intervention related to the electrical lines.  To determine the characteristics of the basin (if the project is placed in the high, medium or low area of it, if it is endorheic, exorheic or arheic, its drainage divide, its surface runoff regime) and the drainage network. GEF6 CEO Endorsement /Approval Template-August2016

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 To identify if the place where the project will be located encourages erosion as a response of the changes that can occur in the vegetable cover as well as in the soil texture and structure.

OS 3: Involuntary Resettlement

Firstly, it is necessary to identify if there is a population in the area of the project. In this case, it should be characterized in order to know if they form a community with human, economic and cultural relationships. After this, it should be determined whether the project takes into account its resettlement, including the displacement and the re‐localization.

The significance of the change in the life, habits and traditions of the community will have to be assessed by using a geographical, demographical, sociological, socio‐economic and social welfare approach. The distances between the project and the human settlements should be represented considering each part of their activities (such as warehouses, farmyards or barns), the natural resources used by them as well as the access ways.

OS 4: Indigenous People

In almost every province of the country indigenous people can be found. However, their distribution and quantity varies from one to another. In general, they live in small and disperse communities, but there are some exceptions. So, it is important to consider the impacts that the bioenergy pilot projects could produce on these groups of people.

OS 5: Pest Management

When working with biogas projects that include the later utilization of the digestate resulting from the anaerobic degradation, the innocuousness of this sub‐product should be controlled, especially in processes that deal with manure or waste from slaughterhouses. Wrong conditions in one of the processes, like low retention times, could result in a non‐stabilized effluent. Then, if this effluent is scattered on the soil, a proliferation of pathogens, antibiotics and hormones can occur. This should be controlled through an adequate management plan for each pilot project.

OS 6: Physical Cultural Resources

Before the development of each pilot project, the existence of places with scientific value because of their antiquity, singularity or historical heritage should be verified. In any of these cases, the potential alteration or damage of the site should be assessed as well as if it is reversible. Moreover, the interactions with other secondary effects (for example, effect on tourism due to a decrease in the historical or landscape value) need to be assessed. The area of influence of the project should be also assessed with the aim of preventing the alteration of popular expressions of any community or people.

OS 7: Safety of Dams Not applicable.

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In addition to these general observations, the following table describes the province‐specific issues to take into account regarding each Operational Safeguard.

Province Buenos Aires Corrientes Cordoba Entre Rios Misiones Santa Fe ‐ Slaughterhouse ‐ Slaughterhouse ‐ Slaughterhouse ‐ Dairy processing ‐ Feedlot ‐ Dairy processing ‐ Dairy farms ‐ Dairy processing facilities ‐ Rice mills facilities ‐ Feedlot facilities Sector ‐ Forestry (sawmills) ‐ Feedlot ‐ Forestry (sawmills) ‐ Feedlot ‐ Rice mills ‐ Feedlot ‐ Dairy farm ‐ Dairy farm ‐ Forestry (sawmills) ‐ Dairy farm ‐ Pig farms ‐ Pig farms ‐ Pig farms

In addition to the environmental and social management plan that each pilot project should present, each province has specific legislation related to the requirement of Environmental Impact Assessment79.

For rice mills and All the technologies For the dairy farms forestry (sawmills), considered to and feedlot sectors All the technologies All the technologies As combustion combustion produce bioenergy in bio‐digestion considered to considered to produce processes are processes are these sectors have in processes take place. produce bioenergy in bioenergy in these considered, potential considered. Because general the same As the province has these sectors have in sectors have in general atmospheric of this, potential environmental and water streams and general the same the same emissions should be atmospheric social impacts. As bio‐ reservoirs, it is environmental and environmental and specially assessed OS 1: emissions should be digestion processes important to assess social impacts. As bio‐ social impacts. As bio‐ and controlled. Environmental specially assessed take place and the the composition, digestion processes digestion processes In addition to this, as and Social and controlled. province has water quantity and disposal take place and the take place and the working with forest Assessment In addition to this, streams and requirements of the province has water province has water waste, it is important when working with reservoirs, it is effluents produced to streams and streams and reservoirs, to monitor its forest waste, it is important to assess prevent water reservoirs, it is it is important to assess traceability to ensure important to monitor the composition, contamination. important to assess the composition, it is not coming from its traceability to quantity and disposal For rice mills and the composition, quantity and disposal native forest ensure it is not requirements of the forestry (sawmills), quantity and disposal requirements of the exploitations that do coming from native effluents produced to combustion requirements of the effluents produced to not follow a forest exploitations prevent water processes are effluents produced to prevent water sustainable that do not follow a contamination. considered. Because prevent water contamination. management plan. sustainable In addition to this, of this, potential contamination. management plan. the province of atmospheric

79 Please also see section 3) below. GEF6 CEO Endorsement /Approval Template-August2016

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Finally, in the feedlot Cordoba is a place emissions should be sector bio‐digestion where this issue of specially assessed processes take place. odours generated by and controlled. As the province has bioenergy projects In addition to this, water streams and should be specially when working with reservoirs, it is taken into account forest waste, it is important to assess due the different important to monitor the composition, altitudes of its its traceability to quantity and disposal territory. ensure it is not requirements of the coming from native effluents produced to forest exploitations prevent water that do not follow a contamination. sustainable management plan. This is a province with high levels of This is a province biodiversity Since the whole area of with high levels of significant ecological this province is being biodiversity Although with a diversity, natural used for agriculture and significant ecological lower level of resources (such as cattle ranching, it is diversity, natural biodiversity No specific issues the Guarani Aquifer) No specific issues considered to be one of resources (such as compared to other OS 2: Protection have been identified and natural habitats have been identified the most endangered the Guarani Aquifer) provinces of the of Natural in addition to the (for instance, 35% of in addition to the ecosystems in and natural habitats Mesopotamia region, Habitats country application its territory is country application Argentina. Because of (Iberá Wetlands). So many rivers and analysis of this OS. rainforest and it has analysis of this OS. this, it is important to that it will be natural habitats can the Iguazu ensure the protection of essential to assess be also found in this waterfalls). Therefore its natural habitats such whether the project province. it will be essential to as deltas and wetlands. produces negative assess whether the effects. project produces negative effects. OS 3: It is important to evaluate potential involuntary resettlement and their mitigation measure, but there are not specific provincial issues related Involuntary with this OS. Resettlement

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There are no large There are not large indigenous indigenous It is highly vulnerable Indigenous Mapuche and communities in this communities in this There are no large in terms of protection communities (such as OS 4: Indigenous Tehuelche communities province. However, province. However, indigenous of indigenous people Mocovi, Toba and People can still be found in this there are some small there are some small communities in this as the biggest Mbya Huarpe) can be found province. groups of them groups of them province. Guaraní community in this province. especially near the especially near the lives in its territory.80 capital city. capital city. As one of the main As one of the main As one of the main As one of the main As one of the main activities of this activities of this activities of this activities of this activities of this sector sector is based on sector is based on sector is based on No specific issues sector is based on is based on bio‐ bio‐digestion, it is bio‐digestion, it is bio‐digestion, it is have been identified bio‐digestion, it is OS 5: Pest digestion, it is important to ensure important to ensure important to ensure in addition to the important to ensure Management important to ensure the the innocuousness of the innocuousness of the innocuousness of country application the innocuousness of innocuousness of the the sub‐products to the sub‐products to the sub‐products to analysis of this OS. the sub‐products to sub‐products to prevent prevent pest prevent pest prevent pest prevent pest pest propagations. propagations. propagations. propagations. propagations. In this province historical heritage No specific issues have No specific issues No specific issues No specific issues No specific issues such as previous OS 6: Physical been identified in have been identified have been identified have been identified have been identified communities’ ruins Cultural addition to the country in addition to the in addition to the in addition to the in addition to the can be found and it is Resources application analysis of country application country application country application country application import to ensure that this OS. analysis of this OS. analysis of this OS. analysis of this OS. analysis of this OS. the pilot projects do not damage them. OS 7: Safety of N/A N/A N/A N/A N/A N/A Dams

80 Among the six selected provinces for the development of bioenergy projects, Misiones is the most vulnerable in terms of protection of indigenous people as the biggest Mbya Guaraní community lives in its territory. There are 24 communities with a property deed and occupation permit for more than 13.600 Ha that have been transferred from the province to the organization called “Asociación de Comunidades del Pueblo Guaraní”. From this total, there are approximately 240080 Ha of native forest under exploitation (data source: http://indigenas.bioetica.org/base/base-d5.htm). GEF6 CEO Endorsement /Approval Template-August2016

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3. Policy, legal, and administrative framework 184. In October 2015, Argentina issued Law No. 27,191, an amendment to Law No. 26,190 that establishes the national regime for the promotion of renewable sources of energy for power production. New projects or repowered existing plants benefit from an anticipated VAT return for capital goods purchased, accelerated amortization of the income tax, tax certificates for projects with national components and extension to ten years of the period for tax carry‐forwards. In addition, the government will fix an energy purchase price, calculated on a project‐to‐project basis, to guarantee a fair return on investment.

Law No. 27,191 also provides for the creation of the Trust for the Development of Renewable Energies, mainly financed by the National Treasure. This fund will provide a subsidy of US$0.11/kWh to photovoltaic (PV) producers and US$0.005/ kWh for facilities up to 30MW generating electricity from wind, geothermal, biomass, biogas and hydro sources. However, to date, this fund has not been set up and the FiT is unavailable.

The short and long term objectives of Law 26,190 (as amended by Law 27,191) and Decree 531/2016 (“RE Framework”) are for RE to become 8% of the total electrical power consumed in Argentina by the end of 2017 and 20% by the end of 2025 respectively.

Fiscal incentives were included in both Law 26,190 and its predecessor Law 25,019, which allowed for deferred tax payments and provided 15 years of “fiscal stability” to existing projects whereby, during that period, the overall fiscal burden of renewable energy projects cannot be increased by means of augmented, modified, new or additional taxes and fees. Decree 562/2009, which regulates Law 26190, provided for accelerated depreciation and for VAT refunds after 3 years.

Federal laws on renewable energy invite provinces to adhere to the legislation and develop their own province‐level incentives. For instance, Decree 562/2009 developing Law 26,190 of 2006 invited provinces to adhere to Law 25,019 and to establish provincial fiscal incentives such as exemptions from revenue tax, local and administrative fees and property taxes. Some province‐level policies include:

 Province of Buenos Aires – Law 12,603 of 2001 exempts renewable energy projects from property tax for 10 years, provides USD 10/MWh for 10 years, and facilitates financing through long-term low-interest loans from the Buenos Aires Province Bank.  Province of Chubut – Law 4389 of 1998 exempts renewable energy projects from province taxes for 10 years and provides USD 5/MWh for wind power complying with a set of local content requirements  Province of Mendoza – Law 7822 of 2008 sets a target of 15% renewable electricity consumption by 2023 and provides exemption from provincial taxes to renewable energy projects.  Province of Misiones – Law 4439 of 2008 establishes a provincial framework for the promotion of renewable energy and creates a fund for the promotion of renewable energy and biofuels.  Province of Neuquén - Law 2596 of 2008 provides additional USD 1/MWh2 for 15 years.

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 Province of Santa Cruz – Law 2796 of 2005 provides exemption from property tax and all province taxes during ten years to the manufacturing of renewable energy equipment. It also establishes a subsidy of USD 3.45-10.30/MWh. Both the exemption and subsidy are variable depending on the percentage of local content. In 1999, Argentina launched the PERMER programme for rural electrification with renewable energy. PERMER was financed through a World Bank loan (USD 30 million), a UNEP grant (USD 10 million), federal and provincial governments, and contributions from concession companies and users.

PERMER provides companies a 15‐year concession to install and maintain subsidized renewable energy systems. For residential systems 79% of the cost is subsidized by PERMER. Users pay about 2% of the installation cost upfront, and the remaining 19% is covered by the concession company, which then recovers the investment plus O&M costs through a flat monthly fee for the duration of the concession.

At the end of 2012 PERMER had resulted in the electrification of 1894 public schools, 361 public service facilities and 25071 households.

Besides the energy legislation, there are national and sub‐national environmental legislations in Argentine that have to be considered. The most important one are listed below.

However, whether required or not by the legislation, it will be always necessary to present an environmental and social management plan for each project. It should consider all the activities related to the potential risks associated to its different stages: construction, operation and closure.

National environmental legislation framework Law No. 25675 It establishes the minimal requirements to achieve a sustainable and proper environmental management, to preserve and protect the biological diversity and to implement the sustainable development. It defines the principles that must be followed by the environmental policy, among them, the precautionary principle.

Law No. 25612 Integral management of industrial and services waste It establishes the minimal requirements of environmental protection about the integral management of industrial and services waste.

Law No. 24051 Hazardous waste It defines its scope of applicability, lists the different waste streams considered as hazardous and establishes the procedures for conducting the proper management and treatment of them.

Law No. 26331. Decree 91/2009. Native Forest Law Establishes the minimal requirements for environmental protection for enhancement, restoration, conservation, development and sustainable management of native forests and their environmental services. This Law led to the “National Program of Native Forest Protection”.

Law No. 26432 (extent and reform of Law 25080/1998). Investment in Cultured Forest Promotes investments in new forestry enterprises and extending existing forests with an objective of increasing wood supply through forestation.

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Sub‐national environmental legislation framework In addition to the national legal framework, as Argentina is a federal country, there are specific legislation in each of the six selected provinces regarding bioenergy projects and the presentation of the environmental impact assessment of them. These legislations are described below.

Buenos Aires: Ley Nº 11.723. Integral law of environment and natural resources.

Article 10°: Every Project that consists in the realization of constructions or activities that produce or could produce any negative effect in the environment of the province of Buenos Aires and/or its natural resources, should obtain a “Declaración de Impacto Ambiental” (Environmental impact statement) issued by the municipal or provincial environmental authority according to the categories stablished by the regulation as it reads in the expository list included in the annex II of the law.

Article 11°: Every physical or juridical as well as public or private person that owns a project with the characteristics of the previous article must present an environmental impact assessment following the dispositions that the authority determine in accordance to the 13° article.

Article 12°: Before to the administration resolution to be adopted for the realization or authorization of the constructions or activities covered by the 10° article, the competent authority will send the observation that it considers relevant to the provincial or municipal environmental authority about the project so as this organism can issue the “Declaración de Impacto Ambiental” (Environmental impact statement)»

Cordoba: Law No. 7343: Regulatory Decree No. 2131 In the Annex II are listed the projects that mandatorily have to present the “Aviso de Proyecto” (Project notification) and conditionally have to present the Environmental Impact Assessment. Regarding bioenergy projects, it is important to consider the following sections: Section 2: Projects of agricultural, hunting and fishing production. Section 3: Project of infrastructure and equipment Subsection A: Generation, Transport and Distribution of Energy.

Corrientes Law No. 5517 (It modifies the law No. 5067 related to Environmental Impact Assessment) In Annex of the law are listed the activities that should present an Environmental Impact Assessment. The type of bioenergy pilot projects planned to be done are not specifically included there. However, the article No. 2 of law states that in some cases when the activities are not covered, the authority could anyway require an Environmental Impact Assessment of them.

Entre Rios: Decree 4.977/09.

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It approves the regulation of the Environmental Impact Assessment. It also defines the Secretariat of Environmental as the competent authority of the Decree. In its Annex 6 the classification of the activities that should comply with this requirement can be found and it includes: the generation of energy coming from sources such as solar, biomass, wind, geothermal, etc.

Santa Fe: Law No. 11.717 of Environment and Sustainable Development Decree 101/2003 In its article No. 3 it highlights that “Any project capable of modifying the environment should be initiated before obtaining the endorsement of the Environmental Impact Study from the competent authority for the phases involved”. In its Annex II it describes the activities that have to comply with this regulation. The electricity, gas and water related activities and, inside them, the electricity generation through solar, biomass, wind and geothermal sources are listed in this annex.

Misiones: Ley XVI‐35 The law, whose competent authority is the Ministry of Ecology and Natural Renewable Resources, has not a regulatory decree. However, there some ministerial resolutions that regulate the procedures:  No. 464/08: Procedure for the environmental Impact Assessment for every type of project  No. 353/09: Forest, livestock‐forest and agriculture‐forest investment projects for the acquisition of rural facilities in the border zone.  No. 460/11: Procedure for the sustainable management and land use change plans of the native forestry in the framework of the law XVI ‐105.

4. Environmental and social risks and mitigation measures This section describes relevant environmental and social risks identified during the project preparation period (PPG). Since the ESMP should serve as an active tool, additional risks that are identified during the project implementation will be included as they are identified.

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Table 1: Main environmental and social risks

Cost of Mitigation Technical details of the Timeline,

mitigation technology, including (If substantial; Responsibili E&S risks Mitigating process, equipment, Location frequency, to be covered Applicable ty Measure design and operating start and end by the GEF to procedures date grant or non‐ UNIDO co‐ financing)

Effluent Biogas The project will The project will consider Project sites Throughout Project team N/A leakages consider a several solutions to lifetime of Beneficiaries (groundwater sustainable manage effluents, such installations contamination, effluent control as an impermeable and soil digester bottom, tanks pollution) and pipes as well as underground water monitoring

Risks identified Gas leakages Biogas Monitoring of gas The project will consider Project sites Throughout Project team N/A during the PIF production to several solutions to lifetime of Beneficiaries preparation and detect leakages avoid gas leakages, such installations verified during the as the application of project efficient sealing, a gas‐ preparation (PPG) tight construction, installation of a safety flare, continuous maintenance of plant.

Sulphur Biogas, Monitoring of The project will consider Project sites Throughout Project team N/A emissions Biomass sulphur based several solutions to lifetime of Beneficiaries emissions avoid sulphur emissions, installations such as the application of scrubbers or second

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absorbers

Increase in Biogas, Monitoring of The project will not Areas around the Semi‐annually Project team N/A agricultural Biomass agricultural engage in activities that portfolio of pilot with activities (e.g. activities and utilise new land for projects assistance of energy‐crop productivity as energy purposes only. local cultivation for well as Feedstocks used in stakeholders co‐digestion to feedstocks. project sites shall fulfil increase the sustainability criteria. plant’s efficiency)

Deforestation Biomass Monitoring of The project targets the Areas around the Semi‐annually Project team N/A origin of use of sustainable dry portfolio of pilot with feedstock biomass: agricultural by‐ projects assistance of (especially in the products such as rice local / case of wood / husks, forest wastes or national wood‐based pruning. stakeholders residues)

Increased Biogas, Monitoring of The project will target Project sites Throughout Project team N/A transportation Biomass supply distance suppliers that guarantee lifetime of Beneficiaries to minimize the the most installations Suppliers carbon footprint environmentally friendly

caused by the feedstock supply and

transportation of assure that buyers of

residues as well end‐products are as products preferably in the vicinity. generated

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5. Environmental and social sustainability monitoring Table 2: Monitoring of environmental and social risks

Monitoring methods Sampling/ Parameters to Timing/Frequency Detection Definition of E&S risks and procedures used monitoring Responsibility be measured of measurement limit thresholds (e.g. sampling) location

Effluent leakages Amount of Logs of the Frequently Amount of Project sites Project team (groundwater leaking monitored results monitored, annually effluent in m3 contamination, and effluents (if reported Beneficiaries soil pollution) any)

Gas leakages Amount of Logs of the Frequently 4.4% Amount of Project sites Project team leaking gases monitored results monitored, annually gases in (if any) reported m3/sec Beneficiaries

Risks identified Sulphur emissions Amount of Logs of the Frequently Amount of Project sites Project team during the PIF sulphur based monitored results monitored, annually sulphur in preparation and emissions (if reported ppm Beneficiaries verified during any) the project preparation(PPG) Increase in Agricultural National / Regional Annually % increase in Areas around Project team agricultural activities productivity data; beneficiary info agricultural the portfolio of with assistance (e.g. energy‐crop Feedstock to be productivity pilot projects of local / cultivation for co‐ Origin of Logs of the continuously national digestion to increase feedstock monitored results monitored, annually Origin of Project sites stakeholders the plant’s efficiency) reported feedstock Beneficiaries

Deforestation Forest density Satellite imaginary to Semi‐Annually Amount of Areas around Project team

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and surface detect changes in cleared forest the portfolio of with assistance area forest area and in hectares pilot projects of local / density, national communication with stakeholders government

Increased Carbon Logs of calculations Annually Fuel Project sites Project team transportation footprint of potential consumption emissions caused by and distances Beneficiaries transportation of Suppliers feedstock and end

products

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6. Capacity development 185. 186. Management arrangements of the project 187. The institutional arrangement considered at this stage includes the following organs:  The Project Steering Committee (PSC) as the highest decision-making authority, the preliminary composition of which is as follows: o Representative of UNIDO; o Representative of MINAGRI; o Representative of MINEM; o Representative of MAyDS (GEF Operational Focal Point); o National Project Coordinator (UCAR). 188.  For daily management and coordination of project activities, a project management unit (PMU) will be set up by UCAR.  The PMU will include as a minimum the National Project Coordinator (NPC). The Management structure of the EMSP is represented below.

PSC

PMU

NPC

Short term national International Experts experts

Other stakeholders, who will intervene in other aspects (apart from management) of the project, will be identified during project implementation. Capacity building – especially with respect to the pilot projects – is foreseen as part of the project activities.

7. Communication Following the request approval, the project will annually communicate on implementation progress, including evolution of identified risks and impacts on the project implementation using the PIRs. Periodic reports on the project status based on the template of the GEF 6 Tracking tool will also be

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made available. The ESMP and the relevant progress report will be disclosed on the UNIDO public website, under the following link: https://open.unido.org/index.html#/projects.

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