World Bank Annual Meeting Policy Forum – October 10 th , 2013

1. World Bank Annual Meeting Policy Forum – October 10th, 2013 Environmental and Social Assessment and Management: Strengthening all levels of the Integrated Framework Cumulative Impact Assessment: Making it work: challenges and options Emmanuel Boulet Principal Environment Specialist Inter-American Development Bank

2. Assessment methodologies are well established… • General consensus on needs and definition • Address “blind spots” of the project-focused ESIA process • Definition e.g. “changes to the environment that are caused by an action in combination with other past, present and future actions”(Hegman et al.) • Methodologies exist and their value is proven • Identify the Valued Ecosystem Components (VECs) • Consult stakeholders on VECs and agree on key ones • Define the geographical and temporal scale • Build scenarios and assess impacts of each scenario on key VECs (VEC-centered perspective) • Identify impact and risks mitigation strategies following the mitigation hierarchy

3. …but there are challenges to make it work in a project-centered safeguards framework • Roles and responsibilities: attribution of impacts to a specific project is in effect impossible • General attribution methodology considers: • Comparison with/without the Project • Relative contribution of the Project to the resulting cumulative impact • Interdependence of effectiveness of mitigation strategies: considering each project in isolation leads to sub-optimal solutions. • Example: cascade hydropower: • With/without a specific project in the cascade generally does not make a lot of difference to the overall cumulative impact • Cumulative impact >> ∑(project impact): each project can have a small contribution to a resulting significant cumulative impact • Management dilemma: e.g. barrier effect on migratory fish. • Who owns and manages the resulting cumulative impact?

4. Attribution challenge: Chiriqui Viejo River • Nine hydropower plants are being developed in cascade on the Chiriquí Viejo River, in western Panama. • The tailrace of each project - • in effect converting the river • in a succession of small • reservoirs and dewatered • stretches. • Consider cumulative impact • on the river with/without a • specific plant. For each plant.

5. Lessons Learned: options to make it work • Public Sector: appropriate regulatory and institutional framework in place, e.g. for hydropower cascade: • Planning tools at the river basin scale, e.g. watershed management plan, • Stakeholders representation, e.g. river basin committees • Authority which “owns” the cumulative impacts at river basin scale • Lessons learned: Sequencing is important. CIA recommendations are unlikely to be acted upon if the key elements of such framework don’t already exist. • Private Sector: best efforts to engage and contribute to a multi-stakeholder collaborative approach for the implementation of management actions that are beyond the capacity of an individual project proponent • Lessons learned: Requires a champion. Who is willing to own by default the cumulative impact issues ? Often difficult to implement in practice due to the attribution challenge and a “tragedy of the commons” situation. • Synergies public/private: “the Panel finds that this absence of complementarities between public and private sector development efforts is partially responsible for the observed flaws.” (Compliance Review Report of loan 2266/OC-PN “Pando-Monte Lirio Hydroelectric Power Plant Project).

6. Another outcome of CIA process: river offset for the Reventazon Hydropower Project in Costa-Rica A CIA process was carried out considering all existing and future developments in the Reventazon River basin Conclusion of the CIA was that cumulative impacts on key VECs (fish, tourism, water quality, etc…) would be significant. As a consequence of the CIA process, decision was taken in line with the mitigation hierarchy to develop and implement a river offset: e.g. commitment to leave a free flowing and healthy river system untouched recognizing that cumulative impact on the developed river system can’t be further mitigated.