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ミンダナオ石炭火力発電所
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NGOから日独・金融機関に提出した 「フィリピンのミンダナオ石炭火力発電所に関する要望書」  (2003.10.14) (英語本文)


October 14, 2003


Chairman of the Board
Kreditanstalt fur Wiederaufbau
Palmengartenstr. 5-9
60325 Frankfurt/Main
Germany


Mr. Kyosuke Shinozawa
Governor
Japan Bank for International Cooperation
4-1, Ohtemachi 1-chome
Chiyoda-ku, Tokyo 100-8144
Japan


Mr. Hidehiro Konno
Chairman and CEO
Nippon Export and Investment Insurance
Chiyoda First Building, 3-8-1 Nishikanda,
Chiyoda-Ku, Tokyo 101-8359
Japan



Re: Mindanao Coal-fired Power Plant in the Philippines


Dear Sirs,

We, the undersigning 58 NGOs from 19 countries, actively monitor the social and environmental impacts of export credit agency lending and insurance services, and are advocating reforms so that social and environmental policies rise to the level of international standards and good practices, such as the World Bank's safeguard policies.

We are aware that your institutions are currently considering funding or providing insurance services for the Mindanao Coal-fired Power Plant. Local groups, such as People's Campaign against the Mindanao coal-fired thermal power plant (a fast-growing local alliance of many people's organizations and civic and religious groups) are very concerned about the project because of health hazards, adverse environmental impacts, and the lack of proper information disclosure and consultation.

We strongly request your institutions to more prudently review the project in terms of the fulfillment of national and international standards and good practices, and the respect for the rights and interests of the affected local groups.

(1) Health hazards and environmental damage
Research (FOOTNOTE 1: "Coal-Fired Power Plants and the Menace of Mercury Emissions" (Greenpeace Southeast Asia, August 2001), "Hazardous Emissions from Philippine Coal-fired Power Plants" (Greenpeace Research Laboratories, Department of Biological Sciences, and University of Exeter, Exeter, UK, July 2002). See (https://www.greenpeacesoutheastasia.org/en/seareports.html).) conducted by Greenpeace and the University of Exeter in England on ash samples of four existing coal-fired power plants in the Philippines, also financed in part or backed by JBIC, revealed high levels of mercury and other heavy metals (arsenic, chromium, and lead) in the effluents. As a result, investigations of the Philippine Senate on the ill-effects and health hazards of the already existing coal-fired power plants are ongoing and the question of constructing a new coal-fired power plant is therefore highly controversial at the national level.

Before deciding on loans and insurance services for the construction of the Mindanao plant, your institutions should wait for the results of these investigations and avoid influencing the national decision making process by announcing that you are ready to finance the construction of an additional coal plant. It is highly possible the research will conclude that the existing coal plants have contributed to hazardous environmental damage in the Philippines. We urge you as financial institutions to take seriously your commitments to sustainable development and not provide any loans or insurance services for projects that are likely to magnify the already existing environmental problems of the country.

The local groups are also concerned about the high amount of discharges of thermal effluents from the power plant into Macajalar Bay. The fishery, as well as the marine ecosystem of Macajalar Bay, which contains a fish sanctuary (the Agutayan Reefs), will be adversely affected by the discharge of thermal effluents. According to local groups, more than 3000 households actually depend on the fishery in the Macajalar Bay for their livelihood.

Furthermore, they have pointed out that it is necessary to investigate the effects of the coal-fired plant on the environment and the people outside the specific project area in a wider range than is considered in the Environmental Impact Assessment (EIA). The EIA only covered an area within a 2-km radius from the stack and a distance of approximately 6 km along the coastline starting at the mouth of Tagoloan River. According to your own environmental checklists, you should prudently conduct reviews of whether the project proponents take the concerns and opinions of the affected people seriously, and adequately explain and properly respond to them.

(2) Involuntary resettlement
It is still unclear how many people will need to be relocated for the Mindanao plant. The numbers vary from 100 individuals to 100 households (equivalent to 500-1000 individuals). But it is already obvious that the affected people have not had any opportunity to take part in the planning process concerning resettlement. No consultation of their options, regarding land or monetary compensation for example, has taken place.

Furthermore, it should also be noted that the compensation standard for demolished structures in the relocation packages of the responsible governmental agency PHIVIDEC does not meet the international standards, such as World Bank Operational Policy 4.12 (which stipulates that depreciation of structures and assets should not be taken into account). The standard of the PHIVIDEC is "10% of the appraisal value of a structure to be demolished."

Despite the fact that many resettled farmers affected by other projects in the same region (PHIVIDEC Industrial Estate) had been promised job opportunities, many are still waiting for these opportunities today. The local groups also complain that they received no offer to participate in the planning, implementation and monitoring of the Social Development Plan (issued by the State Power Development Cooperation (FOOTNOTES 2: SPDC is a joint venture of the project proponents, the German Steag and the Filipino State and Investment and Trust, Inc. (SITI).) ), which was launched recently. As a result of these negative experiences with the project proponents, both in this project and in past projects in the PHIVIDEC Industrial Estate, the local groups doubt that compensation will be carried out in a fair and just manner.

Before making critical decisions on loans and insurance services, we urge you to ensure that the conditions exist for fair and equitable compensation as well as the improvement of living standards and, at the very least, the restoration of livelihoods of people facing involuntary relocation, such that they are able to share in the project benefits, and that these procedures are implemented to a standard that is equal to all the relevant World Bank standards.

(3) Viable alternatives
In addition to the above-mentioned social and environmental issues, we must also state that the planned coal-fired plant is not the most sustainable energy option for the "Misamis Oriental" region. The local groups have pointed out that alternatives that are economically and ecologically more sound, such as renewable energy sources and the rehabilitation of existing hydroelectric power plants, were neither discussed in the EIA nor during consultations. According to World Bank standards, economically and ecologically feasible alternatives to the project also need to be taken into consideration.

Especially with regards to the construction of new coal-fired power plants it is important to consider all alternatives. Huge infrastructure projects such as coal-burning power plants contribute to air pollution and climate change over their long live spans, from the pollutants in plant emissions, such as carbon dioxide, nitrogen oxide and sulfur dioxide. To be true to your commitments to "sustainable development," institutions like JBIC, NEXI and KfW should only support coal-fired power plants if no alternative power sources with less impact on the global environment can be found.

(4) Questionable economic viability and onerous Power Purchase Agreement
Apart from the above-mentioned environmental and social issues, the project is also plagued with other irregularities concerning the economic viability of the project. First, the need for the power to be generated by the project is highly questionable. Local groups state that it is much cheaper and more efficient to increase the efficiency of existing power plants than to invest in the construction of a new plant.

Second, the Project Evaluation Review conducted by the National Economic Development Authority (NEDA) in Region 10 (Northern Mindanao), published in June 2002, maintains that the project is not viable economically and financially, and may require a government subsidy of about U.S.$10 million per year, for a period of 25 years.

Third, the Philippines Inter-Agency Review Committee investigated 35 onerous Independent Power Producer contracts, one of which was of the Mindanao Coal-fired Power Plant (MCPP). The Committee found "financial irregularities" in the contract with MCPP. As a result of the report of the Review Committee, investigations on the issue by the Philippines Senate and House of Representative have already begun.

Before making your decision on Mindanao, we urge you to wait for the results of these investigations and to carry out additional studies regarding the economical feasibility of the project, in order to ensure that you do not invest public money in projects that could prove to be a huge demerit to the Philippine state and its people.

(5) Lack of proper information, consultation, and participation
Local groups have been unsuccessful trying to obtain a copy of the Environmental Impact Statement (EIS) from the relevant Philippine government agencies (FOOTNOTES 3: Friends of the Earth Japan got the EIA for the Mindanao plant from JBIC in May, 2003. JBIC and NEXI need to disclosure the EIAs of projectsthat they classify as Category A projects.) . According to World Bank standards the EIA needs to be made publicly available and the affected people then need to be consulted to give them an opportunity for comment. In this respect, World Bank standards were not fulfilled. This oversight almost guarantees that concerns and comments made by the local groups will not be adequately addressed in the EIA or incorporated into the project plan. As a result of the questionable social acceptability to the project, the Philippine Senate has already adopted a resolution and is currently investigating the approval of the Environmental Compliance Certificate (ECC).

Another area of concern relates to grievance mechanisms and the follow-up of environmental and social considerations such as monitoring plans, Multi-partite Monitoring Team (MMT), Environmental Guarantee Fund (EGF) and Environmental Monitoring Fund (EMF), which have been proposed by the proponents in the EIS and the Social Development Plan. In past projects in the Philippines, such schemes have failed to ensure adequate information disclosure to local residents and local NGOs and the opportunity for appropriate participation and consultation, which are crucial for the proper implementation of the schemes. In the case of the Mindanao coal-fired power plant project, the lack of information and participation of the affected people has been highly criticized. The local groups also point out that the voices and participation of the landless farmers in PHIVIDEC Industrial Estate are suppressed and restricted under the supervision of the PHIVIDEC (especially due to the fear of harassment by the guardsmen of the Phividec Industrial Authority).

We urge you to carry out reviews to establish whether or not the grievance mechanisms can be expected to solve unforeseen problems in the future in a satisfactory manner, and whether they will allow for the participation of affected people, taking into consideration the performance of the proponents in the present and in past projects.


Since there are still many serious open questions regarding the social, environmental and economical viability and feasibility of the Mindanao coal-fired power plant, we strongly request you:

(i) To carefully review the project, taking special note that additional in-depth studies on several above-mentioned aspects ought to be carried out before you make any decision, in order to guarantee that international standards and good practices will be met in this project. We even recommend that you postpone your final decision on the Mindanao plant until all national investigations on specific aspects of the project have been concluded;

(ii) To conduct fact-finding missions and to not only refer to information from the project proponents, but to also actively obtain opinions and information from local residents and local NGOs;

(iii) To ensure adequate transparency and accountability towards all stakeholders, including local residents and local NGOs, even before making your decision on funding or providing insurance services, in order to guarantee that their concerns will be incorporated in the review process and into the decision-making process;

(iv) To not extend the funding or insurance services, if the proponents of the Mindanao coal-fired power plant fail to give proper consideration to the social, environmental and economic viability and feasibility, or if you judge that the proponents cannot be expected to give such consideration after you make decisions on funding or insurance services.


We appreciate your attention to this letter and look forward to your responses.


Sincerely,


Hozue HATAE
Public Finance and Environment Program Campaigner
Friends of the Earth - Japan

Barbara HAPPE
Campaigner on Financial Institutions
Urgewald - Germany


Cc: Mr. Hans Eichel, Minister of Finance, Germany
Mr. Wolfgang Clement, Minister of Economy, Germany
Mr. Joseph Fischer, Minister of Foreign Affairs, Germany
Mr. Juergen Trittin, Minister of Environment, Germany
Mr. Sadakazu Tanigaki, Minister of Finance, Japan
Mr. Shoichi Nakagawa, Minister of Economy, Trade and Industry, Japan
State Power Development Corporation
STEAG Shareholder Association
PHIVIDEC Industrial Authority
National Economic and Development Authority, Philippines
Department of Environment and Natural Resources, Philippines
National Power Cooperation, Philippines
Mr. Antonio Calingin, Governor of Misamis Oriental, Philippines
Mr. Masamoto Tazaki, President and CEO, Kawasaki Heavy Industries. Ltd.
Mr. Hidetoshi Nishimura, President and CEO, Nissho Iwai Corporation



This letter is also endorsed by the following organizations.
(The names of organization and countries who endorsed are followed here.)

*This letter got 56 endorsements from 19 countries.



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