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RuadoRócio,351,1ºandar VilaOlímpia–CEP:04552Ͳ000 SãoPaulo,Brasil Porto de Sergipe I Thermoelectric Complex Social and Environmental Executive Summary Report Contents 1 Executive Summary .......................................................................................................... 1 1.1 Objective and Justification ............................................................................................ 1 1.2 Main Characteristics of The Enterprise ......................................................................... 2 1.2.1 Temporary Structures: ..................................................................................... 3 1.2.2 Schedule and Investments: .............................................................................. 3 1.3 Thermoelectric Complex History .................................................................................. 4 1.4 Areas of Influence ......................................................................................................... 5 1.5 Environmental Impact Matrix and Evaluation Summary .............................................. 6 1.6 Cumulative Impact Assessment ................................................................................. 1-9 1.7 Risk Assessment ......................................................................................................... 1-9 1.8 Social and Environmental Plans and Programs........................................................ 1-10 1.9 Environmental Compensation ................................................................................. 1-13 1.10 Conclusion ................................................................................................................ 1-13 Figure FIGURE 1: PORTO DE SERGIPE I THERMOELECTRIC COMPLEX MACRO-LOCATION ..................................................... 1 FIGURE 2: PORTO DE SERGIPE I THERMOELECTRIC COMPLEX DIAGRAM ................................................................. 3 FIGURE 3: FRAMEWORK OF SOCIAL AND ENVIRONMENTAL PLANS AND PROGRAMS FOR THE PORTO DE SERGIPE I THERMOELECTRIC FACILITY ............................................................................................................... 1-12 Table TABLE 1: AREAS OF INFLUENCE ...................................................................................................................... 5 TABLE 2: ENVIRONMENTAL IMPACT ASSESSMENT MATRIX ............................................................................... 1-7 1 Porto de Sergipe I Thermoelectric Complex Social and Environmental Executive Summary Report 1 Executive Summary The Porto de Sergipe I Thermoelectric Complex will be implemented in the city of Barra dos Coqueiros, state of Sergipe, a municipality next to the capital, Aracaju. This project is composed of three main basic units: a floating offshore storage and regasification unit (FSRU), a thermoelectric plant (UTE) and the transmission line (TL) to conduct the energy towards the public system. Through burning of natural gas, the project will have an installed capacity of 1,516 MW. Figure 1 below shows the macro-location of the Porto de Sergipe I Thermoelectric Complex. Figure 1: Porto de Sergipe I Thermoelectric Complex macro-location 1.1 Objective and Justification The Brazilian electric energy supply, marked by concentration on hydraulic sources, has been changing significantly in recent years, presenting diversity of both renewable and non-renewable sources. Among those, natural gas was responsible for generating 12.9% of Brazil's electricity in 2015, according to the National Energy Balance, base year 2015, prepared by MME / EPE, 2016. To meet the diversification of the Brazilian energy matrix and, at the same time, to provide security to the system by reducing dependence on climatic factors, without reducing the relevance of renewable resources, natural gas has increased its contribution among non-renewable sources. This growing scenario of the Brazilian electric energy market requires more investment in public planning due to the demand of the consumer market, besides the growth of the strategic use of natural gas. To provide greater efficiency and safety in the national energy matrix, Centrais Elétricas 1 Porto de Sergipe I Thermoelectric Executive Summary Complex Social and Environmental Report de Sergipe SA - CELSE SA, having as shareholders EBRASIL Energia Ltda. and GG Power S.A., each with a 50% share, participated in the 21st New Energy Auction held by the Energy Research Company (EPE) in April 2015. The Porto de Sergipe I Thermoelectric Power Plant (UTE Porto de Sergipe I) will be responsible for supplying electric power beginning in January 2020. The commercialization of electricity will be through an Energy Trading Contract in Regulated Environment - CCEAR (Contrato de Comercialização de Energia no Ambiente Regulado) by Availability. The project was authorized by Ordinance MME No. 530, dated November 23, 2015. 1.2 Main Characteristics of The Enterprise The process of electric power generation of this complex is initiated in the reception of the fuel, natural gas in its liquefied form, transported by tankers (LNGC) to the Floating Storage and Regasification Unit (FSRU), which is equipped with a regasification system with a storage capacity of 170,000 m3 of Liquified Natural Gas (LNG) and a regasification capacity of 21 MNm3/day (millions of normal cubic meters per day), located 6.5 km from the coastline, linked to a Submerged Anchoring System called softyoke. This anchorage system will allow the free rotation of the FSRU and will provide for the interconnection of this unit to the pipeline and fuel directing to the plant. The gas pipeline, in turn, starts at the connecting flange of the softyoke and ends at the inlet flange of the UTE Porto de Sergipe I onshore. As a result, it is 6.5 km long in the offshore area, and is complemented to the area of the plant by 1.2 km in the onshore portion. The thermoelectric plant, located about 1.2 km from the coast line, will use natural gas as fuel for the generation of electric energy in Combined Cycle. In order to attend to the processes involved in the operation of the UTE, seawater will be collected by a 2.6 km long pipeline (1.2 km in the onshore part and 1.4 km in the offshore area), interconnected to a pumping station. In addition, the effluents generated in the plant, in turn, will be launched into the sea through a submarine emissary 1.2 km long in the marine region, whose exit is located about 400 m before the water inlet. The electric power generated at the plant will be connected to the National Interconnected System (SIN) by the third unit of the system, consisting of a 500 kV Transmission Line of 34.2 km extension, connecting the UTE Porto de Sergipe I Elevatory Substation to the Jardim Substation, located in the municipality of Nossa Senhora do Socorro. Figure above shows the simplified project diagram, with the structures distributed between Offshore, UTE and Transmission Line, indicating if the structure is located in offshore or onshore environment. 2 Porto de Sergipe I Thermoelectric Complex Social and Environmental Executive Summary Report Figure 2: Porto de Sergipe I Thermoelectric Complex diagram 1.2.1 Temporary Structures: The construction sites of the UTE, Transmission Line and Offshore facility will be implemented in the acquired area of CODISE, near the UTE's deployment area, in an area without vegetationthat has already been modified by previous occupations. In addition, it is planned to install a support tent for the works of the offshore installations, next to the beach strip, adjacent to the Pumping Station, and another for the installation of the connecting bay, adjacent to the Jardim Substation. Both planned areas do not envisage vegetation suppression, as they are located in an anthropic area. 1.2.2 Schedule and Investments: The implementation of the entire Barra dos Coqueiros Thermoelectric Facility has already begun and should be fully completed by December 2019, with the start of the operation scheduled for January 2020. The total estimated investment, considering the Offshore facility, the Thermoelectric Plant and the Transmission line, is approximately R$ 5 billion (Brazilian reais). 3 Porto de Sergipe I Thermoelectric Executive Summary Complex Social and Environmental Report 1.3 Thermoelectric Complex History As explained above, the 21st Energy Auction was carried out by the Energy Research Company (EPE, initials in Portuguese) in April 2015, to commercialize the energy to be generated by the Porto de Sergipe I Thermoelectric Power Plant, with commercial start up in January 2020. At the time this UTE was part of the Thermoelectric Complex Marcel Deda, the design of which was conceived to contain the following units: Thermoelectric Power Plants (i) Porto de Sergipe I; (ii) Laranjeiras and (iii) Marcelo Deda; Transmission line of 500 kV (34 km); and offshore installations and operations (based on TMIB). The grant by ANEEL took place through Decree MME No. 520, November 23rd, 2015. It should be noted that by this time, Marcelo Deda and Laranjeiras UTEs were not considered, since there was no demand for the use of this energy to be sold. The environmental licensing process was initiated by ADEMA, under the auspices of the Process No. 2016/TEC/LP-0003, and received Advance