Pilot Mozambique Biofuel Susainability Framework

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Information about Pilot Mozambique Biofuel Susainability Framework
Business & Mgmt

Published on February 17, 2014

Author: PeterVissers



Results of the pilot with Mozambique Biofuel Susainability Framework. Piloted at a sugar cane plantation, Jatropha plantation and a food energy company in Mozambique. Pilot between Jan and Nov 2013. Presentation given at the end of project workshop in Beira on 31 October 2013.

Piloting the Mozambican Biofuel Sustainability Framework (MBSF) Or... moving forward towards a useful application of the MBSF Project steering: Project funding: Implementation: Update: Occasion: DNER (representing the CIB Technical Commitee) NL Agency (Ministry of Foreign Affairs Netherlands) CEPAGRI Mozambique Partners for Innovation BV 31 October 2013 Workshop for stakeholers, Beira, 31 October 2013 Peter Vissers, Managing Director João Chidamoio, Senior Biofuel Expert © Partners for Innovation 1

Table of contents 1. Work plan: a. Profile of Partners for Innovation 3 b. Work plan with objectives, approach, roles, planning and expected results 5 2. Provisional results: a. R1 – three companies applied the MBSF b. R2 – a government delegation monitored the MBSF application at these 3 companies c. R3 – all participants drafted lessons learned, conclusions and recommendations d. R4 – a dissemination workshop will be held in Beira in Oct/Nov 2013 2 11 21 30 40

About Partners for Innovation Partners for Innovation is a leading consultancy for sustainable innovation based in the Netherlands. Together with our clients we achieve profitable solutions for a biobased and circular economy. In Africa we focus on profitable and responsible biomass chains and agroforestry. We have worked on this topic in Ghana, Niger, Nigeria, Madagascar, Mozambique, Senegal, SouthAfrica, Zambia and Zimbabwe. Our ambition is to help biomass and agroforestry actors to be succesfull. 3

About Partners for Innovation (selected references) Profitable and Responsible Biomass Chains  Capacity building on certification standards (NL Agency, Jatropha Alliance, WWF Madagascar, etc)  Business plan development (Bio2Watt, E+Co, Green Resources, Wakawaka, etc)  Carbon credit development (Bio2Watt, etc)  Scaling up agroforestry (Oxfam Niger, Nigeria, Senegal, Zimbabwe, CleanStar Mozambique etc)  Sustainability indicators (Ghana Energy Commission) Sustainable Energy for All & Climate Policy  Renewable energy potential in EDCs (EC)  Climate policy (Efico, BTC-CTB, etc)  Carbon footprint (Sunbiofuels, Triodos bank, etc)  NL investors mission South Africa renewable energy Product Innovation  EcoDesign training (DAF Trucks, SITA, Dorel, etc.)  Sustainable packaging (NVC, Schoeller Alibert, etc.)  Cradle to Cradle (Desso, Vanderlande, etc.) 4

The MBSF pilot – what are the objectives of the pilot? Two objectives: 1. Build up experience amongst biofuel companies and relevant government institutes with the application of the biofuel sustainability framework for Mozambique by carrying out pilots in the field, and; 2. Evaluate these experiences and formulate practical recommendations to industry and to the inter-ministerial subgroup. 5

Vision – why a pilot? 1. The biofuel sustainability framework provides Mozambique with a powerful and practical tool to assess and monitor biofuel projects 2. The sustainability framework is a thorough and comprehensive work. It would, however, benefit from piloting > to determine its value and feasibility on the ground, and > to augment its practicality 3. Piloting is extremely important given the limited available monetary and human resources at both the companies and the government organizations involved 6

Vision – what is crucial for a successful pilot? 1. Endorsement by the CIB technical committee and the participating governmental organizations; buy-in from the biofuel private sector; acknowledgement from other biofuel stakeholders 2. Learning-by-doing should be the heart of the work. The only way to build up capacity with the sustainability framework, and to assess its practicability and feasibility on the ground, is that the biofuel private sector and the government actually use the framework and really start to work with it 3. Our role is hence to support the biofuel private sector and the governmental monitoring delegation to apply the framework, NOT to collect the info and assess compliance for them 4. A straightforward approach – hands-on and easy to understand. 5. Use the sustainability framework AS IT IS at project start 6. Clear tasks and roles for all actors involved. Flexibility for unforeseen developments 7. Confidentiality and mutual trust. For all involved, the pilot should not lead to any problems afterwards 8. A trusted and competent team having hands-on experience with design and application of sustainability frameworks as well as with the biofuel situation in Mozambique, and having the right language mix (Portuguese/English) 7

Work plan – what is the approach of the pilot? 8

Work plan – which roles have the actors of the pilot? Actor Suggested role and activities AGNL DNER Funding partner. Contract partner for Partners for Innovation. Coordinating implementing partner. Co-organises the project, together with CEPAGRI and the other organisations of the CIB Technical Committee Partners for Innovation Implementing organisation. Co-organises and implements the project. CIB Technical Co-organises the project through DNER. Is informed on progress in CIB Committee Technical Committee meetings. Monitoring delegation Visits the 3 pilot projects and assesses their compliance. Attends the (11 persons) workshop and the monitoring visit. Evaluates the process. Presents the lessons learned at the seminar. Is composed of 11 persons representing national and provincial levels of CEPAGRI, CPI, DNAIA, DNER and DNTF. Participation requested of Ministry of Labour but not obtained. Biofuel pilot companies Apply to become a pilot company. Fill in the self-assessment. Host visit of (3 companies) Partners for Innovation, and then of the monitoring delegation and Partners for Innovation. Evaluate the process. Present the lessons learned at the seminar. Other stakeholders Are invited to the final seminar (as well as all actors mentioned above). 9

Work plan – what do we expected to achieve at project end? Four concrete results: 1. Three biofuel project developers have used the sustainability framework to pilot assess their compliance against the framework, and have undergone a pilot monitoring visit; 2. The monitoring delegation has used the sustainability framework to pilot assess the compliance of three project developers; 3. The experiences of these pilots are evaluated, lessons learned identified, conclusions and recommendations are drawn; 4. Interested Mozambican biofuel stakeholders have had access to the findings of the pilot through a seminar and a final report 10

R1 – Sugar cane company GEZ made a MBSF self-assessment 11

R1 – Jatropha company NiQel made a MBSF self-assessment 12

R1 – Food-energy company CleanStar made a MBSF self-assessment 13

R1 – Each company assessed itself against each verifier of the MBSF TAB3. ASSESSMENT >> Below the self-assessment fields that companies and government delegation fill in during the pilot COMPANIES MBSF requirements Self-assessment Source: draft regulation MBSF (v3 Feb 2013) Guidance Compliance Evidence Justification scores Nr Verificadores Guia de Guidance developed for SelfSelfCompanies explain in a few words the score for compliance. (Note: in the MBSF pilot it was decided avaliação pilot (beyond draft assessme assessme to focus CSM's self-assessment on its Sofala activities. CSM's bottling factory and sales activities in regulation) nt score nt score Maputo are hence not part of the assessment) GOVERNMENT Evidence list Companies list the available evidence. Evidence not available or not in Dropbox: lower score Observation Government officials put remarks 1. Legalidade Princípio 1: as operações de Biocombustíveis cumprem as obrigações prescritas na lei e obedecem as ordens emanadas pelas autoridades legítimas com respeito pelos direitos fundamentais. Principle 1: Biofuel operations respect all applicable laws, regulations and legal procedures Critério 1.1: Operações de Biocombustíveis devem estar em conformidade com todas as leis, políticas e estratégias aplicáveis e com o respeito a todos os direitos costumeiros existentes, relacionados com o uso e acesso à terra, água e outros recursos Criterion 1.1: Biofuel operations shall comply with all applicable laws, policies and strategies and with all existing customary and informal rights related to the use and access to land, water and other natural resources. Indicador 1.1.1: O operador de Biocombustíveis fornece evidência demonstrando o cumprimento das leis, regulamentos e procedimentos legais aplicáveis e dos direitos costumeiros. Indicator 1.1.1: The biofuel operator provides evidence demonstrating compliance with the applicable laws, regulations and legal procedures and with the informal and customary rights. Constituição da Nº 3 do artigo General Mozambican Not Not NA NA NA República de 2004 2, artigo 38, nº legal framework applic. applic. 2 artigo 46. (NA) (NA) Lei nº 16/91, de 3 de Artigo Licence/concession for Full Partial A water use license / concession does not seem necessary since the activities use low amounts of Available in dropbox: EIA 2012, Agosto, (Lei de Águas). 25,27,32,35,37 the use and benefit of complianc evidence water. In Dondo the operations use water from CSM's rain collection bassin and from its invoice of ARA Centro 2012. water e (100%) (75%) borewhole. In Tsawane there is a borewhole. The expected water use of the factory is less than Not available: evidence that no 8m3/hr according to the EIA p78/79. The ARA Centro water invoices CSM for annual consumption water licence/concession is in 2011 and 2012 of 450m3/a. Full compliance, partial evidence (evidence that a water use licence required is not required is missing). Diploma Ministerial nº Licence/concession for Full Partial As As 7/2010, de 6 de Janeiro, the use and benefit of complianc evidence (modelos de licenças e water e (100%) (75%) concessões de água) Lei n.º 20/97, de 1 de Artigo EIA if required Full Partial EIA. CSM completed a simplified Environmental Impact Assessment (EIA) for its factory producing Available in Dropbox: EIA 2012, Outubro, (Lei do 15,16,17. (full/simplified). complianc evidence ethanol from cassave in Dondo and for its 2 main Community Processing Centres (CPCs) located Governor/MICOA letters 2011, Ambiente). Environmental licence. e (100%) (75%) near Mezimbite and near the Administrative post of Savane. The EIA concludes that the activities 2012. Env licence 2012. 2013 Approval lettre of MICOA are environmentally viable (p13). In terms of negative impacts, the EIA identifies 1 high, 12 letter to MICOA Sofala medium and 8 low impacts, and has formulated mitigation measures. In terms of positive regarding use of molasses. 2013 impacts, the EIA has identified 3 high and 3 medium impacts. The EIA refers to 8 management addendum EIA for use of programmes (Social Communication Program, Program for Personnel Training and Operating, molasses. 2013 presentation on Environmental Education Program, Signaling Program, Reforestation Program, Assistance IASA framework. 2013 IASA Program for Families Involved in the Project, Recovery Program Contaminated Soils, and tool. Monitoring Program Water Quality Artificial Pond) (p137), and defines 12 monitoring actions and Not available: evidence of includes 8 monitoring tables. CSM has obtained an environmental licence. Full compliance, full compliance with programme evidence. and monitoring engagements EIA compliance and impact monitoring. CSM indicates to implement the project as described in of the EIA, internal report on the EIA. There is evidence for this since CSM has management programmes in place that cover MICAO inspection the above programmes (e.g. its HSE programme) and monitors the effectiveness of these programmes (e.g. incident reporting in HSE programme). There is also evidence that CSM monitors well its obligations regarding EIA: in July 2013 CSM submitted an addendum EIA for use of molasses to Sofala MICOA. CSM has furthermore developed a framework to monitor the social, environmental and economic impacts of its activities (IASA framework). Regarding compliance 14

R1 – Each company stored supporting evidence in Dropbox (average 400MB) 15

R1 – Pilot compliance is high (92-97%); supporting evidence is lower (70-85%) MBSF self-assessment: evidence MBSF self-assessment: compliance 1. Legalidade 100% 8. Protecção Ambiental 80% 60% 1. Legalidade 100% 2. Responsabilizaçã o Social 8. Protecção Ambiental 20% 0% 6. Segurança Alimentar Company GEZ NiQel CSM 7. Produtividade Agrícola 3. Consulta Pública 4. Segurança Energética 5. Viabilidade Económica e Financeira 60% 2. Responsabilizaçã o Social 40% 40% 7. Produtividade Agrícola 80% 20% 0% 6. Segurança Alimentar GEZ 4. Segurança Energética 5. Viabilidade Económica e Financeira NiQel CSM 3. Consulta Pública GEZ NiQel CSM Pilot compliance with MBSF MBSF follow-up Pilot evidence 97% = full compliance (90%-100%) > No follow-up 79% 92% = full compliance (90%-100%) > No follow-up 70% 94% = full compliance (90%-100%) > No follow-up 85% (after verification by monitoring delegation, reference to MBSF version Oct 2013) 16

R1 – The companies found applying the MBSF hard work, but useful + fun 17

R2 – Eleven government officials were on the 6-days monitoring visit 1. Ministério da Energia - DNER Issufo Juma 2. Ministério da Agricultura - CEPAGRI Jorge Manuel Manjate 3. Ministério da Agricultura - DNTF Osvaldo Manso 4. Ministério da C. A. Ambiental - DNAIA Bento Natal C. Joaquim 5. Centro de Promoção de Investimentos CPI Julio Antonio 6. Direcção Provincial R. Minerais Sofala Jorge Arnaca 7. Direcção provincial de Ambiental Sofala Cesario Jose Fernandes 8. Direcção provincial de Agricultura Bernardo Fernando 9. CEPAGRI - Delegação Manica Ester Jacinta 10. CEPAGRI - Delegação Zambézia Nelson dos Santos Sacoor 11. CEPAGRI - Delegação Zambézia Renato Martins 12. Partners for Innovation / UEM João Chidamoio 13. Partners for Innovation Peter Vissers 18

R2 – The monitoring delegation verified the MBSF application at 3 companies Typical program (start 8H, end 15H): A. Arrival, welcome by the company, setting agenda B. Plantation tour C. (lunch) D. Questions & answers session E. Verification of self-assessment, discussion of scores and underlying evidence. Upor downgrading of self-assessment scores upon consensus F. Evaluation and recommendations G. Group photo and end-of-visit 19

R2 – The MBSF application was verified in a respectful and friendly process 20

R2 – The start of the visit process was a plantation tour 21

R2 – The plantation tour provided good insight in the situation in the field 22

R2 – A Q&A session allowed a thorough understanding of the company activities 23

R2 – Self-assessment scores and their justification were verified in consensus 24

R2 – A group photo marked the end of each visit of the monitoring delegation 25

R2 – Each visit resulted in concrete recommendations for the companies For example >> Q13 Do you have recommendations for company A? 1. Organize all evidence of activities not registered and ask the CPI benefits according to the CBF!! 2. The environmental component and the implementation of the environmental management plan should be strengthened further 3. The company should document the facts to serve as proof / evidence 4. The company must comply with all laws and recommendations of the team's findings 5. Segregation of waste in the workshops, comparative table of emissions / carbon capture by biomass 6. Enjoy the maximum available local resources such as the case of the wood commercially existing at the time of drop for social use 7. Document their interactions with the community to be more transparent and supporting about the steps forward 8. Involve a Mozambican technician to accompany the work of foreign agronomist 26

R3 – Government participants were very satisfied on the self-assessment process >> Average score is 4.4 >> Meaning between 4. “good” and 5. “very good” Evaluation: the 11 government delegation members are satified about the pilot self-assessment proces The self-assessment matched the situation in the field The self-assessment allowed me to have a good insight in how the company complies with the MBSF The self-assessment allowed me to check whether the compliance was supported by evidence The visit and discussions allowed me to understand the value of the MBSF The visit and discussions allowed me to understand how the MBSF can be applied in practice Average scoree= 4,4 out of 5,0. Scores range from 1 "I strongly disagree" to 5 "I strongly agree". 1,0 1,5 27 2,0 2,5 3,0 3,5 4,0 4,5 5,0

R3 – Companies were very satisfied about the pilot self-assessment process >> Average score is 4.3 >> Meaning between 4. “good” and 5. “very good” Evaluation: the 4 company participants are satified about the pilot and the field visit The information meeting on 22 March was useful to understand the pilot The field visits and assessment process were useful to assess the compliance of our company The field visits and assessment process were useful to understand how the MBSF will work in practice Average scoree= 4,3 out of 5,0. Scores range from 1 "I strongly disagree" to 5 "I strongly agree". 1,0 1,5 28 2,0 2,5 3,0 3,5 4,0 4,5 5,0

R3 – The MBSF is considered very useful but not fully ready for implementation >> Average score of usefulness of MBSF is 4.5. >> Meaning between 4. “good” and 5. “very good” >> Government and business attribute similar scores >> Average score of readiness of MBSF for implementation is 3.3. >> Meaning 3. “neutral” Evaluation: the 15 participants are convinced of the value of the MBSF but not yet about whether it is ready for implementation The MBSF regulation is a useful tool for the Mozambican biofuel industry The MBSF regulation is ready for implementation Scores range from 1 "I strongly disagree" to 5 "I strongly agree". 1,0 1,5 29 2,0 2,5 3,0 3,5 4,0 4,5 5,0

R3 – All participants were happy with the work done in the pilot >> Average score is 4.1 >> Meaning 4. “good” Evaluation: the 15 participants are happy about the pilot The documents produced in the pilot were useful The communication during the pilot was of good quality and of the right frequency The pilot was well prepared and organised The field visits were well prepared and organised The pilot helped to understand how the MBSF will work in practice The pilot helped to understand how the MBSF can be improved Average scoree= 4,1 out of 5,0. Scores range from 1 "I strongly disagree" to 5 "I strongly agree". 1,0 1,5 30 2,0 2,5 3,0 3,5 4,0 4,5 5,0

R3 – Participants provided suggestions on biofuel sector development For example>> Q31 Do you have recommendations on how to further the development of the biofuel sector in Mozambique? 1. In the case of cassava, companies should produce the raw material in their fields 2. Improvement of regulation 3. More disclosure and in all sectors 4. Making extensive approach to citizens in education and in rural areas 5. Government entities should support the promotion of biofuel practices and grant tax benefits to companies 6. Sensitize the local level about the use and benefits 7. Review which crops can be used as a biofuel crop 8. Decrease complications of legislation. Keep things simple and clear. Disclose law 9. Greater co-operation between government and producers for more clarity on regulations 10. The biofuel sector in Mozambique should enhance the integration of the use of biofuels through having centralized processing and storage units, clear biofuel policies and quality standards to ensure its acceptance in the market 31

R3 – Participants provided suggestions for the government sector For example>> Q32 Do you have specific recommendations in this perspective for the government sector? 1. Educate and train technicians on the MBSF regulation 2. Coordinate the work to ensure best possible legislation 3. Strive to coordinate with biofuel companies 4. Encourage the production of biofuels in the national territory to combat destruction through unsustainable tree cutting for charcoal 5. Secure areas for food production, ensure food security and sustainable development 6. Try to harmonize regulations and ensure that they are applicable in the field 7. Ensure periodic multidisciplinary monitoring 8. Strive for participation of other institutions such as the Ministry of Labour 9. Create exceptions to certain rules. Disclose legislation connected with the whole process of the biofuels industry 10. Include cassava as a biofuel crop 11. Provide assistance in developing rail transport, clear biofuel policies, price mechanisms and storage at ports 32

R3 – Participants provided suggestions for the private sector For example>> Q33 Do you have specific recommendations in this perspective for the private sector? 1. Employ trained Mozambicans in existing areas. For example agronomists 2. The private sector has to show evidence of 100% in the process 3. Ensure the use of clean technologies, avoid food insecurity 4. Keep interconnected and participative on government policies. Continue to open discussions based on analysis of government legislation 5. Collect evidence that demonstrates that they comply with applicable legislation. Ask for available tax benefits 6. Involve more communities, always work in partnership with local governments 7. Understand perfectly the Mozambican biofuel policy and its price mechanisms 33

R3 – Participants provided suggestions for third parties For example>> Q34 Do you have specific recommendations in this perspective for third parties (consultants, certification bodies, others) 1. Know and have the domestic legislation 2. Consultants have to work with depth and co-ordinate with certification bodies in order to discover and resolve the bottlenecks 3. Should continue to work with communities and producers of biofuels to ensure a correct implementation 4. Be serious in investigations and offer recommendations... 5. Know the complexity of the country and try to link approaches to top management 6. Use the framework 7. Easing the legislative process, search for solutions 8. Certification bodies and consultations should be open minded, flexible and realistic when assesing projects 9. Ensure promotion of investment in biofuel sector 34

R3 – Participants provided suggestions for follow-up activities and next steps For example>> Q44 Do you have suggestions for follow-up work that needs to be done? 1. Integrate representatives of the beneficiaries in the team to reinforce the evidence 2. Disclosure and monitoring of the regulation 3. Distribution of the material 4. Monitoring and frequent consultations, schedule periodic monitoring of companies 5. Providing periodic reports (monthly) to structures in charge of permit in districts and provinces 6. The monitoring should start with information at provincial level and then national 7. May-be help companies implement all recommendations 8. Review progress in 6 months 9. Follow up on evidence documents so that pilot projects may reach up to 100% full evidence 35

R3 – The government delegation suggested practical MBSF improvements For example>> 1. 2. 3. 4. 5. 6. Typify the documentation required for each principle Specify the competences of the central organ (CIB) and the provincial government Revise Art 8… responsible for the CIB... coordinating with the provincial government Revise Art 9... fitting the CIB in co-ordination with the government provincial... Provide the form of Annex 2 information necessary... Improve Art 13 with regard to the sanctions... typify what corresponds to warnings, fines... as a function of the nature of principle, criterion and indicator. 7. Regarding Art 14b refers to analysts and technical meeting of the IWC. 8. Revise Art 8 regarding the level of compliance with quantitative and qualitative. 9. Classify the articles... 10. Revise verifiers to avoid repetition 11. Clarify the issue for the cut of trees for project investment. Need licenses or not. 12. Clarify the issue regarding the need to have a license for use of groundwater... 13. Clarify how to assess GHG balance sheet, energy balance, energetic efficiency. 14. Break down compliance/evidence in the regulation as in the tool 15. Clarify responsibility per principle (P5 P6 joint responsibility CEPAGRI DNTF) 36

R4 – A seminar will ensure sharing of results with Mozambican stakeholders > > > > > > > > > > > Date and timing Location: Organisor: Target public: 31 October , 13H-17H Beira CIB represented by DNER National biofuel sector. Target of 50 persons: staff of relevant national and provincial directorates, biofuel companies, interested NGOs Seminar objectives: 1. Sharing results of MBSF pilot 2. Sharing lessons learned of MBSF pilot 3. Sharing the new version of the MBSF 4. Preparing the implementation of the MBSF Seminar language: PT. Simultaneous translation to EN Draft programme: PfI proposes to DNER, CEPAGRI and AGNL Draft invitation list: DNER and CEPAGRI propose Sending of invitations: DNER Seminar logistics: CEPAGRI (transport, accomodation, overnight stays, simultaneous translation) with PfI Participant registration: DNER 37

Biofuel sector developments in Mozambique: looking backwards, looking forwards Years 2007-2008 2009-2010 Biofuel private sector • Massive land requests Biofuel policy • Work on policy • starts • Work on zoning • starts Sustainability framework 2011-2012 • Micro scale test • plots • Land • preparation • Few pioneers • Biofuel policy and strategy Zoning continued • Work on framework starts 2013 2014 >> Small scale test • Few productive • plots + larger companies, • plots planted many pre• Embryonic productive • Small scale sector Few pioneers • Few companies • Biofuel blending regulation • CIB decree • Draft regulation 38 Productive companies? Bigger scale? More companies? • Price mechanism? • Biofuel standards? • Logistics studies? • Pilot • Decree biofuels sustainability assessment? • Assisted implementation (dedicated tool, website, training)?

Muito obrigado ! Colophon During the MBSF pilot, companies, government and Partners for Innovation worked with the MBSF so test how assessing compliance against the MBSF can be done in practice. The work reported in this document was part of the pilot and should not be considered a criticism of any of the organizations involved. Although this document was developed with the greatest possible care, Partners for Innovation does not accept liability for possible errors. The authors welcome any feedback and suggestions for improvement. 39 Peter Vissers, Managing Director +31 (6) 4260 9354 +258 (84) 0229 923 João Chidamoio, Senior Biofuel Expert +258 (84) 6229 476 +258 (82) 8786 300

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