Environmental appraisal of projects

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Environmental appraisal of projects

  1. 1. Environmental appraisal of projects Job Thomas Roll No. 8, Semester-5, MBA (PT) School of Management Studies, Cochin University of Science and Technology Cochin, Kerala, INDIA, PIN 682022, Email: job_thomas@yahoo.comIntroductionEnvironmental appraisal is the process of assessment of environmental effect or consequences of aproposed project. Environmental appraisal of project consists of two key components: 1. Environmental report for approval or clearance 2. Sustainable growth of the firmAny project requires environmental clearance for approval or licensing. The approach accounting forthe consideration beyond mere legal clearance is also appreciated in the present scenario. Theenvironmental appraisal of projects are carried out by following approaches, namely,:-1. Feasibility approach a. Reactive approach b. Proactive approachFeasibility approachIn this approach, minimum environmental standards prescribed in the county are to be met. Forinternational companies, beyond environmental standards, company aims at achievingenvironmental certification such as ISO 14000 (general industries) or LEED certification (building orconstruction industries) There are two feasibility approaches, namely, reactive approach andproactive approach.Reactive approachEnvironmental impact assessment is carried out for the sole purpose of getting environmentalclearance.Proactive approachEnvironmental impact assessment is used as a tool to improve planning process, cost effective,carbon credits, safety of work-place etc.LEGAL REQUIREMENTSGovernment of India permits to carry out a project if and only if it satisfies or confirms to‘Environmental Protection Act (1986).’ The clearance from GoI is mandatory for new projects aswell as expansion or modernisation of existing projects. Environmental Impact assessmentnotification published in 2006 declares the partial decentralization by implementing EIA agency andEnvironmental appraisal of projects by Job Thomas Page 1
  2. 2. environmental expert committee at central and state level. The expert committee evaluates theappraisal report by personal visit and public notification. The regulatory authority gives theclearance within 105 days of receipt of final EIA. The biannual compliance report of EIA of project isexpected to submit to the authority for post clearance monitoring.Environmental Impact Assessment (EIA) stagesScreening: Screening determines the requirement of the project to be assessed for EIA.Scoping: Scoping identifies the key issues and its impacts.Impact Analysis: Impact analysis identifies likely environmental and social impact.Mitigation: Mitigation recommends the actions to be taken to reduce the potential adverseenvironmental consequences.Reporting: Reporting presents the results of EIA.Review: Review examines the adequacy and effectiveness of EIA.BEYOND LEGAL REQUIREMENTSThe major aspects or significance of the environmental appraisal of the project other than legalrequirements are1. Meeting higher standards2. Carbon financingMeeting higher standardsThe popular methods of meeting higher standards area. ISO 14000 certificationb. Green Project rating (GRP)c. Global Reporting Initiative (GRI)d. Indian Green Building Council Certificatione. LEED ratingISO 14000 provides environmental management standards to help organisations to minimize thenegative impact of their projects to environment. In 2000, there were about 257 Indian companiescertified with ISO 14000, it is increased to 2016 companies in 2006. The economic benefits of ISO14000 certification aimed modification in production plant are reduction in waste, innovations inprocess management etc.Green rating Project (GRP) is constituted by Centre for Science and Environment (CSE), GoI. GRPis an initiative to rate the industrial units on the basis of environment friendliness. According to theenvironmental friendliness approaches implemented, industrial units are classified into fivecategories in the GREEN LEAF SCALE. The reputation is the incentives for GRP.Environmental appraisal of projects by Job Thomas Page 2
  3. 3. The mission of Global reporting Initiative (GRI) is to make sustainable reporting standardpractice for all organisations. GRI initiate in participate, communicate and report the sustainabledevelopment practices initiative. Only 13 companies from India take the advantages of GRI in 2011.The certification from Indian Green Building Council is another approach of meeting higherstandards. Green buildings use less energy, water and natural resources, creates less waste and ishealthier compared to standard buildingsLeadership in Energy and Environmental Design (LEED) certification is based on six domains(1) Sustainable site(2) Water efficiency(3) Energy and atmosphere(4) Material and resources(5) Indoor environment quality(6) Innovative in operationsIn LEED certification procedure, the building is certified in four categories namely,‘CERTIFICATION’, ‘SILVER’, ‘GOLD’, and ‘PLATINUM’.Carbon financingThe problem of global-warming and climate change lead to initiation of concept of carbon financing.Kyoto Protocol (2005) gives the opportunity for carbon trading. The developing countries producecarbon equivalent less than the prescribed limit, the balance amount of carbon equivalent can besold to developed country to compensate the overproduction beyond the prescribed limit.Significance of environmental appraisal of project1. Environmental appraisal provides true account of real cost and benefit of the project. Quantification of environmental impacts in the approval procedure will help to offset future market failure and penalising the schemes with environmental costs. It helps to promote environmental benefits2. Environmental appraisal provides the adjustment factor to allow environmental depreciation in the computation of national accounts like GNP, GDP etc. The adjusted GNP or GDP is more accurate indicator of country’s development.3. Environmental assessment helps to develop environmental policies through green pricing. In developed countries size of environmental cost and benefits is also accounted in valuation of taxes, subsidies, user charges etc. *******Environmental appraisal of projects by Job Thomas Page 3

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