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The project has been screened as C/1, requiring an environmental due diligence as through the increased equity investment the Bank will be exposed to all environmental and social issues associated with the Company.
An environmental due diligence of the Company was undertaken by an independent consultant in 2006 and again in 2008. The environmental due diligence has not identified any major environmental or social issues and confirmed that the Company is in general compliance with national standards. A new investment programme is being developed to help the Company increase energy efficiency and attain environmental and technical performance in line with international best practice and Enel’s corporate polices. This includes technical and environmental review of all the stations with benchmarking against best available techniques (BAT).
The main environmental risk is associated with the future performance of the generating assets and future requirements for upgrading the plants to meet both Russian and international (such as EU) environmental standards, notably in terms of air emissions. The environmental audits undertaken have identified a number of environmental investment needs and procedural requirements, and following the 2008 environmental audit, an Environmental Action Plan (EAP) was agreed with the Company and Enel, and is currently being implemented. Following the completion within 2009 of Technical and Environmental Audit performed by Enel, a revision of the Environmental Action Plan could be put in place to better address a number of environmental investment opportunities and procedural requirements.
The Bank will continue to monitor the implementation of the EAP, including corporate social responsibility policies of Enel, and overall performance of the plants and undertake monitoring visits as required.
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