ESIA – INDO RAYA TENAGA

Summary of Environmental and Social Impact Assessment

In compliance with the applicable Lenders’ E&S standards for managing the Project’s E&S risks, PT Indo Raya Tenaga (IRT) has developed an Environmental and Social Impact Assessment (ESIA) and an Environmental and Social Management Plan (ESMP) that are specific to the Project. These documents were carefully prepared by IRT together with internationally recognized E&S consultant namely Poyry, now AFRY (https://afry.com/en) and Environmental Resources Management ERM (https://www.erm.com/) during 2019-2021, which have been thoroughly reviewed by Lenders’ E&S Consultant, AECOM (https://aecom.com), to ensure compliance against the above standards.

The impact assessment process has identified the key environmental, social and community health issues, the impacts associated with the Project which requires the implementation of a wide range of mitigation measures. The necessary actions required to manage these issues, impacts and risks are presented in the Project’s ESMP, including other best practice measures designed to avoid, minimise or reduce negative impacts and enhance positive impacts.

Additionally, the Project since the early pre-construction phase in 2018, has established an Environmental and Social Management System (ESMS) and has been updating it continuously. This document has integrated its E&S policy outlining commitments to environmental and social sustainability, identification of risks and impacts, management programs, organizational capacity and competency, emergency preparedness and response, stakeholder engagement, and monitoring and review.

The ESMS and ESMP are live documents that may be enhanced during Project execution, depending on the measured effectiveness of the management measures based on monitoring and auditing of actual performance. This is in accordance with the Lenders’ E&S standards, whereby a key requirement is continuous improvement; an ongoing process of reviewing, correcting and improving the Project E&S management system, where required.

The Project recognizes the significance of integrating environmental and social safeguards and mitigations throughout the Project life cycle, from planning to post-operation phases. This approach enables the acknowledgment, understanding, and sustainable and environmentally responsible management of any adverse risks and impacts in accordance with the requirements outlined in Indonesian regulations and IFC Performance Standards (IFC PS 1 through IFC PS 8).

This page provides a summary of the key environmental and social impact management measures as detailed in the Project’s ESIA.

Summary of Key Environmental Measures

	Environment Aspect	Impact Source	Key Mitigation Measures

1.	Terrestrial habitat	Land preparation works during Project’s construction.	Establish landscaping plan and preserve existing vegetation where possible.
2.	Ambient air quality	Project’s general construction activities and operation of vehicles. Project’s operations	Suppress dust generation by watering/spraying and implement of wheel washing system. Inspect vehicle and machinery to ensure proper operation eligibility. Regularly clean the site access and local roads. Construct the chimney with a height of 265 m and install CEMS. Enclose the coal stockpile area. Use of dust suppression system in coal handling. Use of fog cannon for ash spray. Plant shade trees for dust barrier in boundary. Install and operate the best available equipment such as low NOx burner and Selective Catalytic Reduction, Electrostatic Precipitators, and Flue Gas Desulfurization to remove respective pollutants of NOx, particulate matter, and SO₂
3.	Noise and vibration	Project’s general construction activities and operation of vehicles. Project’s operations	Limit operational traffic to daytime to the fullest extent possible. Inspect vehicle and machinery to ensure the operation eligibility. Install silencer in equipment generating noise where possible.
4.	Waste generation	From Project’s construction and operation work.	All non-hazardous and hazardous waste will be handled, transported, and treated by authorised and licensed third party contractors. Provide the temporary waste storage and ensure compliance with relevant regulations. Adopt the Indonesian Government’s regulation, Minister of Environment and Forestry (MOEF) Regulation No 19/2021, for fly ash and bottom ash management (store, landfill, utilization) as non-hazardous waste. Provide emergency response and management.
5.	Seawater quality and marine biota	Project’s construction works Wastewater during Project’s operations,	Construction of settling ponds to collect the sediment and perform regular clean-up. Install net/screen at the sea, when possible, to reduce the spread of suspended solids. Ensure the temperature of the thermal water discharge meets environmental standards. Treat the generated wastewater at the wastewater treatment facility and ensure and verify compliance with applicable standards
6.	Landscape and visual impact	Project’s buildings, equipment and facilities	Preserve existing vegetation. Plant vegetation, preferable native species. Cover the landfill (long-term plan) when it is full in accordance to Minister of Environment and Forestry (MOEF) Regulation No 19/2021.

Summary of Key Social Measures

	Environment Aspect	Impact Source	Key Mitigation Measures

1.	Community expectations	Workers’ recruitment and procurement of goods and services during construction and operation.	Prioritize local hiring and maximize the involvement of qualified local vendors in the project, while closely collaborating with local stakeholders to monitor the process. Conduct transparent communication with the community and local stakeholders, follow local regulations, and provide a grievance mechanism for fair resolution of any issues.
2.	Social and health impact associated with the presence of non-local workers	Workers’ recruitment and procurement of goods and services	Conduct compulsory medical examinations for all workers, establish an onsite health clinic, and develop and socialize a Project policy on worker behaviours, including training on workforce conduct and cultural awareness; and Implement a grievance mechanism for reporting community health and safety concerns.
3.	Community impact due to migration influx	Workers’ recruitment and procurement of goods and services	To socialise and implement the Project’s grievance mechanism to help community groups understand how to submit complaints about Project workers. Investigate complaints promptly and involve relevant stakeholders as necessary to resolve issues fairly and quickly.
4.	Working condition	Workers’ recruitment and procurement of goods and services	Ensure workers’ contracts comply with Indonesian and International Labour Organization (ILO) standards, outlining fair terms, salary, duration, and rights.
5.	Workforce expectations	Post-construction and post-operation demobilization	Follow Disnaker (Workforce Agency) regulations for demobilizing construction workers. Clearly communicate demobilization plans to workers and manage their expectations. Documentation and archiving the number of demobilized workers. Provide financial management programs and ensure accessible grievance reporting.
6.	Working behaviour	The presence of workforce at Project’s facilities	Developing and socialising a Project policy on worker behaviours with the workforce and the local authorities (sub-district and village leaders) and communities. Establishing and enforcing a zero-tolerance approach should workers conduct any activities that are against Project policy. Socialising and implementing the Project’s grievance mechanism
7.	Community H&S	Project’s construction activities and operations of vehicles Project’s operations	Build fishermen jetty to provide a safe place for fishermen to anchor their boats. Inform fishermen about Project activities, discuss safety risks, provide safety signs, promote safe fishing practices, communicate about the Project’s efforts to preserve sea water quality during CFSPP operation. Conduct socialisation and regular consultation to the local community on mitigation measures undertaken by the Project to manage its waste, effluent discharges, and air emission. Disclose the Project’s grievance mechanism. Provide a traffic management plan to handle congestion and mobilization during the project. Conduct safety campaigns at local schools. Develop an Emergency Response Plan (ERP) for road and accidents, coordinate with local agencies on access road operations. Disclose the Project’s marine transportation schedule with fishermen and the community.
8.	Impact on Livelihood	Project’s construction and operation	Build food stalls for fishermen in the fishermen jetty. Develop a targeted social program to support impacted income following grievance investigations, with careful monitoring of vulnerability.
9	Security arrangement	Project’s construction and Operation	Adhere to international standards and local laws for hiring and training. Conduct thorough background checks to ensure hired security personnel have no history of misconduct. Investigate any credible allegations of unlawful or abusive acts by security personnel, take preventive action, and report to authorities if needed, working closely with police. Provide training on proper conduct and establish a grievance mechanism for accommodating community concerns on security issues.

Grievance