Complaint to PCM of the EBRD on the Nenskra Hydropower Plant project

The Nenskra Hydropower Project (Nenskra HPP or the Project) proposes a large dam with an installed capacity of 280 Megawatts, to be located in the upper reaches of the Nenskra and Nakra valleys in Georgia. It is being developed by JSC Nenskra Hydro, a special purpose vehicle established for the sole purpose of constructing the Project (JSCNH or the Client). The Project is being developed by JSCH and would be owned by K-Water (75%) – a Korean state-owned utility; the Government of Georgia’s Partnership Fund (15%) and the European Bank for Reconstruction and Development (EBRD) (10%). The EBRD would provide a loan of up to USD 214 million and make a portage equity investment of up to USD 15 million. EBRD and ADB are lead arrangers of the Lender group which also includes the European Investment Bank (EIB), the Korean Development Bank (KDB), the Korea Trade Insurance Corporation (K-Sure) and potentially the Asian Infrastructure Investment Bank (AIIB).

The Complaint Submitted to PCM

The EBRD’s Project Complaint Mechanism (PCM) received a Complaint from community members of Chuberi, Georgia, co-submitted with civil society organizations (CSOs) CEE Bankwatch Network and Green Alternative (the Complainants), relating to the Nenskra HPP. The Complaint alleges Bank non-compliance with its 2014 Environmental and Social Policy (2014 ESP), in relation to the following ESP Performance Requirements (PRs):

• PR 7 – Indigenous Peoples, in relation to the absence of categorisation of the Projectaffected Svan community as Indigenous Peoples for the purposes of the Project as defined under the 2014 ESP;
• PR 1 – Assessment and Management of Environmental and Social Issues, in relation to the assessment of Project alternatives, cumulative impacts, associated facilities and gender considerations;
• PR 5 – Land Acquisition, Involuntary Resettlement and Economic Displacement, in relation to the reparation of economic displacement;
• PR 8 – Cultural Heritage, in relation to potential impacts of the Project on the Svan culture and community well-being; and
• PR 10 – Information Disclosure and Stakeholder Engagement, in relation to the consultation process undertaken in consideration of the Project scale.

The Complaint was deemed eligible for a PCM Compliance Review under the criteria outlined in the 2014 PCM Rules of Procedure (PCM RPs)