A critical part of the environmental assessment (EA) process for renewable energy projects is providing commitments around protecting the environment through all phases of project development, and through to operation. Compliance with these commitments is usually underpinned by legislative requirements, and while there is a financial cost to achieve compliance, there are bigger costs and risks to relationships with Indigenous nations, regulators and stakeholders if owners do not comply with their commitments.
How EA commitments are written is also critical since they will become the benchmark by which a project’s environmental performance is measured and monitored for years to come. Part of our work at Ausenco is helping our clients put forward EA commitments that achieve the environmental goals, yet are also pragmatic for implementation. Knowing what owners are agreeing to is important so that the terms can be built into contracting and procurement processes, and the costs can be incorporated into project financing.
In this article, we discuss some of the EA commitment hurdles project owners can encounter during the renewable energy project development cycle, as well as time and resource saving ideas to reduce risk.
The four project stages and why knowledge transfer between them is critical
Most renewable energy projects are broken into four development stages:
- Operation and maintenance
- Decommissioning or repowering.
EA commitments are developed and approved in the initial permitting/approval phase based on agreements to protect physical, biological and social environmental values during the subsequent construction, operation and decommissioning/repowering phases. The biggest risks we’ve seen when guiding clients through the project life cycle are the loss of information and knowledge when moving from one phase to the next, particularly when new proponent teams or new project partners specializing in the new phase are bought onto the project to replace the previous team. Due to these inherent risks, we always advise giving deep consideration to the commitments that were previously made in advance of moving from one phase to the next in a project’s life cycle.
When a commitment becomes problematic
At Ausenco, we understand the types of EA commitments that might become problematic. Flagging them before they become part of a signed agreement is critical. Below are some of the themes we’ve noticed in problematic EA commitments:
• Too specific: Some EA commitments are too prescriptive and leave little or no room for flexibility. Changes are inevitable as you construct and operate a project so there has to be some element of flexibility in your commitments to allow for adaptation.
• Too open-ended: Alternatively, we’ve seen EA commitments that are too broad and which can leave proponents exposed during compliance checks. It’s best to include specific metrics in commitments, including limits and the associated contingency actions should they not be reached.
• Unfinished commitments: Perhaps worse than being too specific or too broad is inexpertly deferring tasks required to develop a commitment to later phases in the development process. Saving time or money during the approval phase, pending information to be obtained later, is an acceptable approach and sometimes necessary for addressing uncertainty. Still, you must build in safeguards such as describing the future process and committing all required parties to that process. Expect to give a little for the flexibility you’re granted if you choose one of these types of commitments.
• Relying on others: Some commitments mistakenly rely either entirely or partially on third parties to fulfill a promise, such as a landowner clearing their property, or a contractor completing a project by a certain deadline. If there’s no way to enforce these third-party promises, the onus is always on the project owner to find and fund the solution, no matter the time or cost.
• Unachievable: In some cases, commitments made are simply not achievable. We’ve seen commitments to relocate infrastructure in the event of not meeting a target. This type of commitment is enormously expensive and impractical. Anything considered impractical or fiscally irresponsible should be avoided.
Project owners need to have a team of experienced developers and consultants who understand the entire life cycle of a project to carefully develop and manage each of the EA commitments.
Keeping projects on track
Ausenco not only helps project owners develop appropriate commitments during the permitting and approval phase, we also work to keep them on track during the subsequent phases. We’ve been involved in projects from feasibility and approval phases through to construction and operation and even in the re-powering of projects. With this experience, we’ve developed a keen sense of commitments that are workable and those that are not. During the handover between development phases, we recommend the compilation and maintenance of an environmental management system — a framework designed to help owners keep on top of their commitments as they move from one project phase to the next. Knowing and understanding your commitments, when they’re due and who’s responsible, is essential. You need a clear understanding of what needs to be done and by whom so that you, your contractor, or consultant does not drop the ball!
Our next article looks at involving the host community in your project, including the importance of relationship-building with project stakeholders including communities, Indigenous peoples, regulators, and other project partners.
Ausenco is a recognized leader in providing environmental support to the renewable energy sector including wind energy, solar, small hydro, run-of-river developments, and associated transmission projects. For more than two decades, our talented, dedicated and experienced impact assessment teams have supported many of Canada’s largest and most challenging projects. Our depth of experience and multi-disciplinary approach allow us to steer projects through the complex assessment and regulatory processes – on time and on budget.