Sustainability assessment tools have been enhanced to better align with ESG requirements set by international financial institutions such as IFC and the World Bank.
Use of the Hydropower Sustainability Tools will mean hydropower developers better understand how their project can achieve the performance standards required by major investment banks for all types of infrastructure projects.
The tools comprise the Hydropower Sustainability Assessment Protocol, which is used to assess projects against 26 social, environmental and governance performance areas, and the Hydropower Sustainability ESG Gap Analysis Tool, which identifies gaps against good practice and produces a gap management plan.
Commissioning an independent assessment using these tools can help prepare project developers to meet lender requirements.
The tools offer a scoring framework specific to hydropower, and in some areas go beyond the requirements of international financial institutions by covering topics such as climate change and hydrological resource.
“The tools can help high-performing projects demonstrate why they merit investment and ensure the best outcomes for the environment and local communities” said Eddie Rich, CEO of the International Hydropower Association (IHA). “At IHA, we encourage our members to sustainability test new projects and are pleased to offer training to strengthen institutional capacity on delivering good and best practice.”
The changes include an update to assessment guidance on consultations with Indigenous Peoples, meaning projects will need to seek the Free, Prior and Informed Consent (FPIC) of affected Indigenous Peoples to achieve international good practice. This brings the assessment tools into line with IFC performance standards and the World Bank’s environmental and social standards.
Other changes to the HESG relate to its structure and section titles. For example HESG section 4 is now titled Community Impacts and Infrastructure Safety, more closely relating the Word Bank’s ESS4 standard on Community Health and Safety.
The tools are governed by the Hydropower Sustainability Assessment Council, whose members include representatives of organisations such as the World Bank, The Nature Conservancy, the International Union for Conservation of Nature, WWF, the Inter-American Development Corporation, hydropower companies and governments.
The International Hydropower Association (IHA) acts as the council’s management secretariat and is responsible for overseeing training and assessor accreditation.