J.4 Initial Environmental Examination LAC-IEE-22-58.pdf

BUREAU/MISSION/PROJECT

USAID 216 ACRO TEMPLATE VERSION 2, MARCH 2018

INITIAL ENVIRONMENTAL EXAMINATION

PROJECT/ACTIVITY DATA

Project/Activity Name: USAID/Mexico Partnership for Net Zero Cities Geographic Location(s) (Country/Region): Mexico Amendment (Yes/No), if Yes indicate # (1, 2...):

Implementation Start/End Date (FY or M/D/Y): FY2022/FY2027 If Amended, specify New End Date:

Solicitation/Contract/Award Number(s):

Implementing Partner(s):

Bureau Tracking ID: LAC-IEE-22-58 Tracking ID of Related RCE/IEE (if any):

Tracking ID of Other, Related Analyses:

ORGANIZATIONAL/ADMINISTRATIVE DATA

Implementing Operating Unit(s):

(e.g. Mission or Bureau or Office)

USAID/Mexico

Other Affected Operating Unit(s):

Lead BEO Bureau: LAC Funding Account(s) (if available):

Original Funding Amount: $24,500,000 If Amended, specify funding amount:

If Amended, specify new funding total:

Prepared by: Jeanette Normand Date Prepared: 12/1/2021

ENVIRONMENTAL COMPLIANCE REVIEW DATA

Analysis Type: x Environmental Examination ☐Deferral Environmental Determination(s): ☐Categorical Exclusion(s) x Negative ☐Positive ☐Deferred (per 22 CFR 216.3(a)(7)(iv)

IEE Expiration Date (if applicable):

Additional Analyses/Reporting Required:

Climate Risks Identified (2): Low ___0___ Moderate ___2___ High ___0___ Climate Risks Addressed (2): Low ___0___ Moderate ___2___ High ___0___ about:blank about:blank

THRESHOLD DETERMINATION AND SUMMARY OF FINDINGS

PROJECT/ACTIVITY SUMMARY

The purpose of this activity is to reduce greenhouse gas emissions by improving energy efficiency measures in the buildings and transportation sectors and reducing Short Lived Climate Pollutants (SLCP) through a variety of interventions that include municipal level policy and code development, and thereby helping to put Mexico on a pathway to net zero emissions after 2030.

ENVIRONMENTAL DETERMINATIONS

Upon approval of this document, the determinations become affirmed, per Agency regulations (22 CFR 216).

TABLE 1: ENVIRONMENTAL DETERMINATIONS

Projects/Activities

Categorical Exclusion Citation (if applicable)

Negative Determination

Positive Determination1

Deferral2

Activity Type 1: technical assistance and guidance on policy and regulation development to reduce greenhouse gas emissions and SLCPs.

Technical assistance and research assistance is aimed at:

● increasing energy efficiency of transportation systems

● increasing efficiency of buildings by improving municipal building codes

● support policy development that supports green energy technology adoption and implementation at the municipal level

● instituting public transportation incentives to rely less on the use of personal use vehicle (PUV) transportation

● diversifying modes of public transportation

☐ X ☐ ☐

1 Positive Determinations require preparation of a Scoping Statement and Environmental Assessment.

2 Deferrals must be cleared through an Amendment to this IEE prior to implementation of any deferred activities.

Activity Type 2: provide technical assistance to develop public and private financial schemes that will improve climate finance and capital investment planning

☐ X ☐ ☐

CLIMATE RISK MANAGEMENT

In accordance with Executive Order 13677 on Climate-Resilient International Development, as of September 2016, all USAID projects and activities require being managed for climate risks. The Climate Risk Management (CRM) process was undertaken and from this the Mission Environmental Officer/Climate Integration Lead determined that the climate risks associated with the Partnership for Net Zero Cities activity are identified as moderate.

The identified risks indicate that climate change will unlikely materially impact achievement or sustainability of project or activity outcomes. The climate risks identified for the Partnership for Net Zero Cities award include the disrupted trading patterns due to floods/droughts/storms and potential increased risk and cost borne by financial institutions due to extreme weather events. See Annex 1 for the complete CRM table.

BEO SPECIFIED CONDITIONS OF APPROVAL

Conditions for approval are listed in Section 5 of this document. In addition, safety measures shall be taken to prevent transmission of COVID-19 during project implementation. Specifically, the implementing partner (IP) will ensure that the following requirements are met:

● Ensure compliance with applicable partner country requirements and technical guidelines to prevent COVID-19 transmission over the course of the activities. This includes ensuring staff safety, safety of community members, and adequate management of waste. As appropriate, train staff and beneficiaries on social distancing, personal protective equipment (PPE) use, and disinfection. IP may follow WHO and/or CDC guidance as appropriate.

IMPLEMENTATION

In accordance with 22 CFR 216 and Agency policy, the conditions and requirements of this document become mandatory upon approval. This includes the relevant limitations, conditions and requirements in this document as stated in Sections 3, 4, and 5 of the IEE and any BEO Specified Conditions of Approval.

USAID APPROVAL OF INITIAL ENVIRONMENTAL EXAMINATION

PROJECT/ACTIVITY NAME: Partnership for Net Zero Cities_____

Bureau Tracking ID: ______________________

Approval: Bruce Abrams 01/12/2022 Bruce Abrams, Mission Director Date

LAC-IEE-22-58

mailto:babrams@usaid.gov

Clearance: Terry Miller 1/12/2022

Clearance:

Terry Miller, Deputy Mission Director

Sharon Gulick

Date

1/6/2022

Clearance:

Sharon Gulick, Director, Office of Sustainable Development

Gerardo Arroyo

Date

12/23/2021

Gerardo Arroyo, A/COR Date

Clearance: Corey Hancock 1/7/22 Corey Hancock, Mission Environmental Officer Date

Clearance: Jeanette Normand 1/7/2022 Jeanette Normand, Regional Environmental Advisor Date

Clearance: Alexis Taylor-Granados 1/12/2022 Alexis Taylor-Granados, Resident Legal Officer Date

Concurrence:

Bethzaida Colon Bureau Environmental Officer Date

DISTRIBUTION:

● AOR/COR for this activity

● OAA for solicitation and to include in the award

● Environmental Compliance Database

INITIAL ENVIRONMENTAL EXAMINATION

CONTENTS

1.0 PROJECT/ACTIVITY DESCRIPTION

1.1 PURPOSE OF the IEE 6

1.2 PROJECT/ACTIVITY OVERVIEW 6

1.3 PROJECT/ACTIVITY DESCRIPTION 6

2.0 BASELINE ENVIRONMENTAL INFORMATION

2.1 LOCATIONS AFFECTED AND ENVIRONMENTAL CONTEXT (ENVIRONMENT,

PHYSICAL, CLIMATE, SOCIAL, Threatened and ENDANGERED species) 8

2.2 APPLICABLE AND APPROPRIATE PARTNER COUNTRY AND OTHER

INTERNATIONAL STANDARDS (E.G. WHO), ENVIRONMENTAL AND SOCIAL LAWS,

POLICIES, AND REGULATIONS 9

2.3 COUNTRY/MINISTRY/MUNICIPALITY ENVIRONMENTAL CAPACITY ANALYSIS (AS

APPROPRIATE) 10

3.0 ANALYSIS OF POTENTIAL ENVIRONMENTAL RISK

4.0 ENVIRONMENTAL DETERMINATIONS

4.1 RECOMMENDED ENVIRONMENTAL DETERMINATIONS 12

4.2 CLIMATE RISK MANAGEMENT 12

5.0 CONDITIONS AND MITIGATION MEASURES

5.1 CONDITIONS 13

5.2 AGENCY CONDITIONS 14

5.3 MITIGATION MEASURES 15

6.0 LIMITATIONS OF THIS INITIAL ENVIRONMENTAL EXAMINATION

7.0 REVISIONS

ATTACHMENTS:

Annex 1. Activity Climate Risk Management Summary Table 18

1.0 PROJECT/ACTIVITY DESCRIPTION

1.1 PURPOSE OF THE IEE

The purpose of this document, in accordance with Title 22, Code of Federal Regulations, Part 216 (22 CFR 216), is to provide a preliminary review of the reasonably foreseeable effects on the environment of the USAID intervention described herein and recommend determinations and, as appropriate, conditions, for these activities. Upon approval, these determinations become affirmed, and specified conditions become mandatory obligations of implementation. This IEE also documents the results of the Climate Risk Management process in accordance with USAID policy (specifically, ADS 201mal).

This IEE is a critical element of USAID’s mandatory environmental review and compliance process meant to achieve environmentally sound design and implementation. Potential environmental impacts should be addressed through formal environmental mitigation and monitoring plans (EMMPs) and/or Environmental Assessments (EAs), if needed.

1.2 PROJECT/ACTIVITY OVERVIEW

Purpose

The purpose of the Partnership for Net Zero Cities activity is to reduce greenhouse gas emissions by improving energy efficiency measures in the buildings and transportation sectors, and reducing Short Lived Climate Pollutants (SLCP), thereby helping to put Mexico on a pathway to net zero emissions after 2030. The activity will work at the subnational level in select areas throughout Mexico.

1.3 PROJECT/ACTIVITY DESCRIPTION

The Partnership for Net Zero Cities activity aims to reduce GHG emission throughout Mexico. To achieve this goal, in the select target cities/states, this activity will work to address 4 overall objectives:

Objective 1: work to improve building cooling efficiency

Objective 2: increase public transport in zero emissions vehicles

Objective 3: reduce methane emissions from the waste sector, and

Objective 4: improve access to private/climate finance and improved capital investment planning and procurement processes.

Achieving the listed objectives will require access to private/climate finance and improved capital investment planning and procurement processes (Objective 4). If these goals can be achieved in 3-6 target cities/states by 2025, then this activity could be scaled to other cities/states so that GOM is on a pathway to achieving net zero emissions by 2030.

Activities carried out under each objective can be categorized into the following activity types:

https://www.usaid.gov/our_work/environment/compliance/22cfr216 https://www.usaid.gov/our_work/environment/compliance/22cfr216 https://www.usaid.gov/ads/policy/200/201mal

Objective Activity Type

Objective 1: work to improve building cooling efficiency by 50 percent

Objective 2: increase public transport to 30 percent zero emissions vehicles

Objective 3: reduce methane emissions by 30 percent from the waste sector

Activity Type 1: technical assistance and guidance on policy and regulation development to reduce greenhouse gas emissions and SLCPs.

Technical assistance and research assistance is aimed at:

● increasing energy efficiency of transportation systems

● increasing efficiency of buildings by improving municipal building codes

● instituting public transportation incentives to rely less on the use of personal use vehicle (PUV) transportation

● diversifying modes of public transportation

Objective 4: improve access to private/climate finance and improved capital investment planning and procurement processes.

Activity Type 2: provide technical assistance to develop public and private financial schemes that will improve climate finance and capital investment planning

TABLE 2: DEFINED OR ILLUSTRATIVE PROJECTS/ACTIVITIES AND SUB-ACTIVITIES

Activity Type Illustrative Activities

Activity Type 1: technical assistance and guidance on policy and regulation development to reduce greenhouse gas emissions and SLCPs.

Technical exchanges, technical analysis including economic modeling and Transportation modeling, scenario planning Building code development that will incentivize energy efficiency within municipal infrastructure portfolios. Local transportation policy development

Activity Type 2: provide technical assistance to develop public and private financial schemes that will improve climate finance and capital investment planning.

Procurement structuring including capital expenditure planning Provide incentive/financing mechanism for commercial buildings meeting a certain EE threshold (e.g. LEED or IFC EDGE) Develop long-term capital investment planning strategy with municipalities to evaluate low-carbon transportation procurement opportunities Provide technical assistance to municipalities and planning agencies so that they can meet the project requirements for accessing green finance

Will this project/activity involve construction3 as defined by ADS 201 and 303? Yes ☐ No x

3 Construction, as defined by ADS 201 and 303, includes: construction, alteration, or repair (including dredging and excavation) of buildings, structures, or other real property and includes, without limitation, improvements, renovation, alteration and refurbishment. The term includes, without limitation, roads, power plants, buildings, bridges, water treatment facilities, and

2.0 BASELINE ENVIRONMENTAL INFORMATION

2.1 LOCATIONS AFFECTED AND ENVIRONMENTAL CONTEXT (ENVIRONMENT, PHYSICAL,

CLIMATE, SOCIAL, THREATENED AND ENDANGERED SPECIES)

Mexico’s greenhouse gas (GHG) emissions have increased by 63 percent over the last three decades and are projected to continue to increase until at least 20304. Mexico will need to scale up climate action to meet its Nationally Determined Contributions (NDC); its current plan is deemed unambitious and insufficient with achieving a way to maintain less than a 1.5 C increase in temperature. Fossil fuels still make up 87 percent of Mexico’s energy mix, which is above the G20 average and despite declining output, the country is still the second largest oil producer in Latin America.

Given the Mexican administration's focus on strengthening the state-owned oil and electricity companies, progress for emission reductions in these sectors does not seem likely. Accelerating the pace of emissions reductions in other sectors, (e.g. transport and buildings) is needed in order to help Mexico remain on a path towards net zero emissions by 2050. Not only do transportation and buildings account for the majority of Mexico’s GHG emissions5, but energy efficiency in buildings, transportation, and industry is expected to account for at least 40 percent of GHG emission reductions in 20506. By accelerating the transition to energy efficient buildings and transportation, this activity will lay the foundation for Mexico to quickly deploy low-cost renewable energy resources in the next ten years.

Transport and buildings present the greatest opportunity for emissions reductions. Mexico’s transport sector has grown over the years without prioritizing low emission technologies and today, it represents one of the biggest emitters of GHGs in the country - second only to power generation. Mexico’s transport sector is dominated by fossil fuels, and the light passenger and heavy-duty vehicles are not only key contributors of GHG emissions but are also the primary source of outdoor air pollution in Mexican cities.

Working on fuel efficiency standards and electromobility is thus a promising route to achieve mitigation targets and reducing health impacts. On the other hand, buildings accounted for about 23 percent of GHG emissions in Mexico7, including direct emissions from fuel burnt onsite and indirectly from electricity consumption. The buildings share is expected to grow to 27 percent by 20508, driven by (1) increased electricity use in homes, particularly as air conditioning becomes more affordable and (2) the growth of the commercial sector with office buildings, shopping centers and hotels. Fortunately, the building sector offers great opportunities to mitigate GHG emissions and contribute to overall climate goals. In fact, the building sector has the potential to emit no net emissions using current technologies.

Additionally, short-lived climate pollutants (SLCP), including black carbon, methane and hydrofluorocarbons, are powerful climate forcers which can also impact air quality. Reducing these pollutants can bring climate benefits and improve health and livelihoods, by preventing premature deaths.

Mexico’s climate change commitments include a target of reducing black carbon emissions by 51% in vertical structures. In the box below, describe any construction planned for this project/activity. Refer to ADS 201maw for required Construction Risk Management procedures.

4 Mexico Climate Transparency Report 2020 5 Coalition for Urban Transitions https://urbantransitions.global/en/publication/seizing-the-urban-opportunity/seizing-mexicos-urban-opportunity/ 6 IEA Net Zero by 2050 7 (SENER-Sistema de Información Energética 2019) 8 LBNL, preliminary estimate.

https://www.usaid.gov/sites/default/files/documents/1865/201maw.pdf https://www.iea.org/news/pathway-to-critical-and-formidable-goal-of-net-zero-emissions-by-2050-is-narrow-but-brings-huge-benefits https://paperpile.com/c/ULZUnk/EtZxv

2030 compared to BAU scenarios. Mexico has an integrated strategy to reduce SLCP, and key sectors in which opportunities exist are the waste, industry and oil and gas sectors.

There is political will in Mexico to address climate change at the subnational level. Many states and municipalities have come up with plans including Mexico City’s eight point strategy to curb annual emissions by 65 metric tons of CO₂ equivalent (mtCO2e) by 2050. The state of Jalisco has also been identified as a climate champion with over seventy-two percent of municipalities having developed climate strategies. Mexico City and Guadalajara also have 2050 net zero targets.

Therefore, an opportunity exists for cities/states to play an important role in climate leadership and many already are climate champions. Even if the national government returns to ambitious national climate commitments, it will not be enough to reduce emissions. Cities and states must be empowered and enabled to implement those commitments.

Interventions that will be implemented are focused on technical assistance, capacity building, research, analyses, meetings, and training. The geographic focus of this activity is on a limited set of subnational champions (states and cities) that are best positioned to benefit from USAID assistance and ultimately share their best practices with other municipalities. Under this activity, USAID/Mexico will identify and work with states and cities to advance decarbonization in Mexico. The final geographical scope will be determined according to the following criteria:

● emissions reduction potential at the original intervention site;

● potential to scale up to other cities and states across the country;

● political opportunity/support among key state or municipal authorities (climate change champion);

● potential demonstration effect; and

● technical capacity of subnational entities as a determinant.

2.2 APPLICABLE AND APPROPRIATE PARTNER COUNTRY AND OTHER INTERNATIONAL

STANDARDS (E.G. WHO), ENVIRONMENTAL AND SOCIAL LAWS, POLICIES, AND REGULATIONS

The Mexican Constitution, in the Article 133 establishes the supremacy of the national constitution and the federal legal framework, mandating that State/local authorities adapt their laws to ensure coordination with national legislation. Article 27 foresees the utilization of renewable natural resources, and recognizes the preservation, restoration of ecological stability and the conservation of nature. In 2012, the Congress modified Article 4, modifying the term “right to an adequate environment," to the phrase “right to a healthy environment," including adding a phrase permitting the identification of those responsible for environmental deterioration, and the infringement of basic rights.

Mexico’s environmental legislation includes six major laws: Ley General del Equilibrio Ecológico y Protección al Ambiente (1988; reformed January 2021), Ley General de Vida Silvestre (2000; reformed 2015), Ley General de Desarrollo Forestal Sustentable (2018; reformed 2021), Ley Federal de Responsabilidad Ambiental (2013, reformed 2021), Ley General de Pesca y Acuacultura Sustentables (2007, reformed 2018) and the Ley de Desarrollo Rural Sustentable (2001, reformed 2021). The Decrees:

Decreto 12-01-1978: Decree establishing Montes Azules Biosphere Reserve, Decreto 20-01-1986: Decree establishing Sian Kaan Biosphere Reserve, Decreto 26-05-1989: Decree establishing Calakmul Biosphere Reserve. Regarding International Agreements: Convention on Illegal Trade in Endangered Species (CITES): Ratified by Mexico in 1993, Convention on Biological Diversity (CBD): Ratified by Mexico in

2003. and the United Nations Convention against Transnational Organized Crime: ratified by Mexico in 2003.

Mexico’s governance over natural resources is managed by the following entities:

- SEMARNAT - Secretaría de Medio Ambiente y Recursos Naturales

- CONAFOR - Comisión Nacional Forestal

- CONANP - Comisión Nacional de Áreas Naturales Protegidas

- CONABIO - Comisión Nacional para el Conocimiento y Uso de la Biodiversidad

- CONAGUA - Comisión Nacional del Agua

- INECC - Instituto Nacional de Ecología y Cambio Climático

2.3 COUNTRY/MINISTRY/MUNICIPALITY ENVIRONMENTAL CAPACITY ANALYSIS (AS

APPROPRIATE)

Mexico has a strong institutionality and legal framework to manage natural resources, but operational and enforcement capacities remain weak. Identified potential government units working on the environment/energy nexus issues include: Secretaría de Medio Ambiente y Recursos Naturales (SEMARNAT), Secretaría de Energía (SENER), Comisión Nacional del Uso Eficiente para la Energía (Conuee), Instituto Nacional de Ecología y Cambio Climático (INECC), Agencia de Seguridad, Energía y Ambiente (ASEA), Other State authorities: Mexican States also have their environmental and or energy authorities responsible for the management of natural resources and energy planning. One example includes the Comision de Ecologia y Desarrollo Sustentable del Estado de Sonora, in charge of executing and evaluating environmental policy at the state level. Other states with similar bodies include the state of Puebla, Yucatan, Jalisco and Nuevo Leon.

https://www.gob.mx/conanp/que-hacemos https://www.gob.mx/conanp/que-hacemos https://www.gob.mx/inecc https://www.gob.mx/inecc

3.0 ANALYSIS OF POTENTIAL ENVIRONMENTAL RISK

PROJECT/ACTIVITY 1: MEXICO PARTNERSHIP FOR NET ZERO CITIES

TABLE 3A. POTENTIAL IMPACTS – PROJECT/ACTIVITY 1

Project/Activity Potential environmental and social impacts

Activity Type 1: technical assistance and guidance on policy and regulation development to reduce greenhouse gas emissions and SLCPs.

Technical assistance and research assistance is aimed at:

● increasing energy efficiency of transportation systems

● increasing efficiency of buildings by improving municipal building codes

● instituting public transportation incentives to rely less on the use of personal use vehicle (PUV) transportation

● diversifying modes of public

a) Potential social impacts include land use changes and improved livelihoods.

b) Job/economic losses for individuals working in traditional energy sectors, if energy efficiency measures reduce demand.

For a complete list of environmental impact considerations associated with small scale distributed solar generation impacts and associated mitigation measure see:https://www.usaid.gov/sites/default/files/documents/18 60/SectorEnvironmentalGuidelines_Energy_2018.pdf assistance to develop public and private financial schemes that will improve climate finance and capital investment planning

Existing local policies surrounding/energy efficiency can play a significant role in uptake of energy efficient technologies.

Potential environmental impacts include:

● Possible competition with traditional suppliers of electricity such as diesel generators and paraffin merchants as off-grid products become more affordable

● Improved private finance may result in poor quality off-grid solar products flooding markets.

● Public sector consumers may revert to traditional sources of electricity such as diesel generators and kerosene, when they do not trust off-grid solar products

4.0 ENVIRONMENTAL DETERMINATIONS

https://www.usaid.gov/sites/default/files/documents/1860/SectorEnvironmentalGuidelines_Energy_2018.pdf https://www.usaid.gov/sites/default/files/documents/1860/SectorEnvironmentalGuidelines_Energy_2018.pdf

4.1 RECOMMENDED ENVIRONMENTAL DETERMINATIONS

The following table summarizes the recommended determinations based on the environmental analysis conducted. Upon approval, these determinations become affirmed, per 22 CFR 216. Specified conditions, detailed in Section 5, become mandatory obligations of implementation, per ADS 204.

TABLE 4: ENVIRONMENTAL DETERMINATIONS

Projects/Activities Categorical Exclusion Citation (if applicable)

Negative Determinat ion

Positive Determinati on9

Deferr al 10

Activity Type 1: technical assistance and guidance on policy and regulation development to reduce greenhouse gas emissions and SLCPs.

Technical assistance and research assistance is aimed at:

● increasing energy efficiency of transportation systems

● increasing efficiency of buildings by improving municipal building codes

● instituting public transportation incentives to rely less on the use of personal use vehicle (PUV) transportation

● diversifying modes of public transportation

☐ X ☐ ☐

Activity Type 2: provide technical assistance to develop public and private financial schemes that will improve climate finance and capital investment planning

☐ X ☐ ☐

4.2 CLIMATE RISK MANAGEMENT

This section summarizes the methodology used and findings of the CRM Screening, in accordance with ADS 201mal. The project design team, in consultation with the CIL, considered the potential effect of climate risks/stressors on the sustainability of the project (changing precipitation patterns, rising temperature, floods, droughts, fires, landslides, etc.) in addition to the impact of project activities on the climate (increased greenhouse gas emissions, land use changes, etc.). See Annex 1 for the complete CRM table.

9 Positive Determinations require preparation of a Scoping Statement and Environmental Assessment.

10 Deferrals must be cleared through an Amendment to this IEE prior to implementation of any deferred activities.

https://www.usaid.gov/ads/policy/200/201mal

5.0 CONDITIONS AND MITIGATION MEASURES

5.1 CONDITIONS

The environmental determinations in this IEE are contingent upon full implementation of the following general implementation and monitoring requirements, as well as ADS 204 and other relevant requirements.

5.1.1 During Pre-Award:

5.1.1.1 Pre-Award Briefings: As feasible, the design team and/or the cognizant environmental officer(s) (e.g., MEO, REA, BEO) will provide a pre-award briefing for potential offerors on environmental compliance expectations/responsibilities at bidders’ conferences.

5.1.1.2 Solicitations: The design team, in coordination with the A/CO, will ensure solicitations include environmental compliance requirements and evaluation criteria. A/CO will ensure technical and cost proposal requirements include approach, staffing, and budget sufficient for complying with the terms of this IEE.

5.1.1.3 Awards: The A/COR, in coordination with the A/CO, will ensure all awards and sub-awards include environmental compliance requirements.

5.1.2 During Post-Award:

5.1.2.1 Post-Award Briefings: The A/COR and/or the cognizant environmental officer(s) (e.g., MEO, REA, BEO) will provide post-award briefings for the IP on environmental compliance responsibilities.

5.1.2.3 Workplans and Budgeting: The A/COR will ensure the IP integrates environmental compliance requirements in work plans and budgets to comply with requirements, including EMMP implementation and monitoring.

5.1.2.4 Staffing: The A/COR, in coordination with the IP, will ensure all awards have staffing capacity to implement environmental compliance requirements.

5.1.2.5 Records Management: The A/COR will maintain environmental compliance documents in the official project/activity file and upload records to the designated USAID environmental compliance database system.

5.1.2.6 Host Country Environmental Compliance: The A/COR will ensure the IP complies with applicable and appropriate host country environmental requirements unless otherwise directed in writing by USAID. However, in the case of a conflict between the host country and USAID requirements, the more stringent shall govern.

5.1.2.7 Work Plan Review: The A/COR will ensure the IP verifies, at least annually or when activities are added or modified, that activities remain with the scope of the IEE.

Activities outside of the scope of the IEE cannot be implemented until the IEE is amended.

5.1.2.8 IEE Amendment: If new activities are introduced or other changes to the scope of this IEE occur, an IEE Amendment will be required.

5.1.2.14 USAID Monitoring Oversight: The A/COR or designee, with the support of the cognizant environmental officer(s) (e.g., MEO, REA, BEO), will ensure monitoring of compliance with established requirements (e.g., by desktop reviews, site visits, etc.).

5.1.2.16 Environmental Compliance Mitigation and Monitoring Plan: The A/COR will ensure the IP develops, obtains approval for, and implements Environmental Mitigation and Monitoring Plans (EMMPs) that are responsive to the stipulated environmental compliance requirements.

5.1.2.17 Environmental Compliance Reporting: The A/COR will ensure the IP includes environmental compliance in regular project/activity reports, using indicators as appropriate; develops and submits the Environmental Mitigation and Monitoring Reports (EMMRs); and completes and submits a Record of Compliance (RoC) describing their implementation of EMMP requirements in conjunction with the final EMMR or at the close of sub activities (as applicable). And where required by Bureaus or Missions, ensure the IP prepares a closeout plan consistent with contract documentation for A/COR review and approval that outlines responsibilities for end-of-project operation, the transition of other operational responsibilities, and final EMMR with lessons learned.

5.1.2.18 Corrective Action: When noncompliance or unforeseen impacts are identified, IPs notify the A/COR, place a hold on activities, take corrective action, and report on the effectiveness of corrective actions. The A/COR initiates the corrective action process and ensures the IP completes and documents their activities. Where required by Bureaus or Missions, ensure Record of Compliance is completed.

5.2 AGENCY CONDITIONS

5.2.1 Sub-award Screening: The A/COR will ensure the IP uses an adequate environmental screening tool to screen any sub-award applications and to aid in the development of EMMPs.

5.2.2 Programmatic IEEs (PIEE): PIEEs stipulate requirements for additional environmental examination of new or country specific projects/activities. The A/COR of any project/activity being implemented under a PIEE will ensure appropriate reviews are conducted, typically through a Supplemental IEE, and approved by the cognizant BEO.

5.2.3 Supplemental IEEs (SIEEs): An SIEE will be prepared for any new project/activity being planned which fall under a PIEE. The SIEE will provide more thorough analysis of the planned activities, additional geographic context and baseline conditions as well as specific mitigation and monitoring requirements.

5.2.4 Other Supplemental Analyses: The A/COR will ensure supplemental environmental analyses that are called for in the IEE are completed and documented.

5.2.5 Resolution of Deferrals: If a deferral of the environmental threshold determination was issued, the A/COR will ensure that the appropriate 22 CFR 216 environmental analysis and documentation is completed and approved by the BEO before the subject activities are implemented.

5.2.6 Positive Determination: If a Positive Determination threshold determination was made, the A/COR will ensure a Scoping Statement, and if required an Environmental Assessment (EA), is completed and approved by the BEO before the subject activities are implemented.

5.2.7 Compliance with human subject research requirements: The AM, A/COR shall assure that the IP and sub-awardees, -grantees, and -contractors demonstrate completion of all requirements for ethics review and adequate medical monitoring of human subjects who participate in research trials carried out through this IEE and ensure appropriate records are maintained. All documentation demonstrating completion of required review and approval of human subject trials must be in place prior to initiating any trials and cover the period of performance of the trial as described in the research protocol.

5.3 MITIGATION MEASURES

The mitigation measures presented in this section constitute the minimum required based on available information at the time of this IEE and the environmental analysis in Section 4. These measures shall provide general direction for completing the project/activity Environmental Mitigation and Monitoring Plan (EMMP) and/or the EA and PERSUAP, if required.

PROJECT/ACTIVITY 1: MEXICO PARTNERSHIP FOR NET ZERO CITIES

TABLE 5A. SUMMARY OF MITIGATION MEASURES FOR PROJECT/ACTIVITY 1

Project/Activity Mitigation Measure(s)

Activity Type 1: technical assistance and guidance on policy and regulation development to reduce greenhouse gas emissions and SLCPs.

Technical assistance and research assistance is aimed at:

● increasing energy efficiency of transportation systems

● increasing efficiency of buildings by improving municipal building codes

● instituting public transportation incentives to rely less on the use of personal use vehicle (PUV)

Partnership for Net Zero Cities will demonstrate that it will work with relevant policy makers, utilities, and other entities to ensure that environmental policies and regulations in place address management of energy efficient equipment and technologies and that there’s capacity to implement those policies and regulations.

Partnership for Net Zero Cities will also encourage policy makers to incorporate and/or adhere to international best practices on environmental and social safeguards such as the IFC Performance Standards.

Any modeling or technical analysis done as part of this activity will include the consideration of the full value of ecosystem services that the land, water (surface, subsurface), forest and air provide to the specific and surrounding geography in question.

Technical analysis to include environmental and social impact

● diversifying modes of public analysis that include the following under review:

● Potential environmental and social impacts associated with large solar projects include land use alterations, habitat loss for wildlife and potential impacts on water availability,

● Site clearance for construction can cause erosion of soil, minerals, and release of harmful pollutants into nearby streams,

● Impacts to displaced persons, to marginalized populations,

● Only projects with minimum negative impacts on the environment and people to be supported.

**Mitigation measures will be addressed through EMMPs.

assistance to develop public and private financial schemes that will improve climate finance and capital investment planning

Partnership for Net Zero Cities will encourage governments to develop and implement policies that allow only quality assured products into their markets and support campaigns disseminate information on the advantages of quality verified products, technologies and services.

Partnership for Net Zero Cities will share risk assessment results with investors and encourage investors not to implement projects where there will be high risk of environmental and social impacts.

Partnership for Net Zero Cities will assist lenders and developers providing credit with tools to assess customer default risk.

IFC Performance Standards guidance will be provided to lenders and Partnership for Net Zero Cities will encourage them to follow their process if relocation or land acquisition is possible.

Partnership for Net Zero Cities will request all environmental compliance documents required by local/national governments from developers.

Partnership for Net Zero Cities will use EMMPs to ensure that environmental and social impacts are adequately addressed in the environmental compliance documents.

6.0 LIMITATIONS OF THIS INITIAL ENVIRONMENTAL EXAMINATION

The determinations recommended in this document apply only to projects/activities and sub-activities described herein. Other projects/activities that may arise must be documented in either a separate IEE, an IEE amendment if the activities are within the same project/activity, or other type of environmental compliance document and shall be subject to an environmental analysis within the appropriate documents listed above.

Other than projects/activities determined to have a Positive Threshold Determination, it is confirmed that the projects/activities described herein do not involve actions normally having a significant effect on the environment, including those described in 22 CFR 216.2(d).

In addition, other than projects/activities determined to have a Positive Threshold Determination and/or a pesticide management plan (PERSUAP), it is confirmed that the projects/activities described herein do not involve any actions listed below. Any of the following actions would require additional environmental analyses and environmental determinations:

● Support project preparation, project feasibility studies, or engineering design for activities listed in §216.2(d)(1);

● Affect endangered and threatened species or their critical habitats per §216.5, FAA 118, FAA 119;

● Provide support to extractive industries (e.g. mining and quarrying) per FAA 117;

● Promote timber harvesting per FAA 117 and 118;

● Lead to new construction, reconstruction, rehabilitation, or renovation work per §216.2(b)(1);

● Support agro-processing or industrial enterprises per §216.1(b)(4);

● Provide support for regulatory permitting per §216.1(b)(2);

● Lead to privatization of industrial facilities or infrastructure with heavily polluted property per

§216.1(b)(4);

● Research, testing, or use of genetically engineered organisms per §216.1(b)(1), ADS 211

● Assist the procurement (including payment in kind, donations, guarantees of credit) or use

(including handling, transport, fuel for transport, storage, mixing, loading, application, clean-up of spray equipment, and disposal) of pesticides or activities involving procurement, transport, use, storage, or disposal of toxic materials. Pesticides cover all insecticides, fungicides, rodenticides, etc. covered under the Federal Insecticide, Fungicide, and Rodenticide Act per §216.2(e) and §216.3(b).

7.0 REVISIONS

Per 22 CFR 216.3(a)(9), when ongoing programs are revised to incorporate a change in scope or nature, a determination will be made as to whether such change may have an environmental impact not previously assessed. If so, this IEE will be amended to cover the changes. Per ADS 204, it is the responsibility of the USAID A/COR to keep the MEO/REA and BEO informed of any new information or changes in the activity that might require revision of this environmental analysis and environmental determination.

ATTACHMENTS:

Annex 1: Climate Risk Management Summary Table for Activity (use for Activity level IEE)

ANNEX 1. ACTIVITY CLIMATE RISK MANAGEMENT SUMMARY TABLE

Tasks/Defined or Illustrative Interventions Climate Risks11 Risk Rating 12 How Risks are Addressed13 Opportunities to

Strengthen Climate Resilience14

Activity Type 1: technical assistance and guidance on policy and regulation development to reduce greenhouse gas emissions and SLCPs.

Technical assistance and research assistance is aimed at:

● increasing energy efficiency of transportation systems

● increasing efficiency of buildings by improving municipal building codes

● instituting public transportation incentives to rely less on the use of personal use vehicle (PUV) transportation

● diversifying modes of public transportation

Increasingly severe weather can negatively impact infrastructure that could be built as a result of guidance and policy development undertaken by this activity.

More frequent or severe weather events resulting from climate change may result in loss of revenue to off-grid developers and challenge efforts to improve performance. For example, increased damage to mini-grid infrastructure will require either additional expenditure to plan and build more resilient infrastructure or pay for retrofits and repairs.

MODERATE Implementing partners will encourage employment of the most current technology, and the most flexible yet robust options for rural grid infrastructure that are designed to withstand changing climate.

Planning and technical assistance will include risks of more frequent and severe weather events so mini-grid developers can be more prepared and reduce overall mitigation expenditures.

Implementing partner will work with ministries and municipalities in making sound development decisions regarding siting, design, and maintenance of power sector

Consult climate models that will allow planners/design teams to adjust and adapt their plans to mitigate and offset the potential risks.

Consult climate models as well as resilient infrastructure design that will allow planners/design teams to adjust and adapt their plans to mitigate and offset the potential risks.

Look for opportunities to collaborate with strong partners to mitigate climate risk and encourage actions to increase flexibility in power systems. Encourage diversification of incomes

11 List key risks related to the defined/illustrative interventions identified in the screening and additional assessment.

12 Low/Moderate/ High 13 Describe how risks have been addressed in activity design and/or additional steps that will be taken in implementation. If you chose to accept the risk, briefly explain why.

14 Describe opportunities to achieve multiple development objectives by integrating climate resilience or mitigation measures infrastructure, including off-grid/rural.

Implementing partner will encourage relevant entities to undertake national and regional planning that includes consideration of climate modeling and potential energy supply and/or demographic shifts throughout the region.

Planning and technical assistance will include risks of more frequent and severe weather events so offgrid can be more prepared and reduce overall mitigation expenditures.

for off-grid companies.

Assist developers to design products that allow for adverse climatic effects.

Activity Type 2: provide technical assistance to develop public and private financial schemes that will improve climate finance and capital investment planning

Climate change poses potential threats to energy security and increases the long-term financial risk to power system investments.

Instability and/or conflict could potentially result from increased extreme weather events that result in conditions like drought and resource scarcity.

Imigration from heavily impacted regions - or energy resource scarcity in countries - may change energy demand and supply patterns

MODERATE Implementing partner will encourage use of the latest technology that is more resilient to damage that may be caused by severe weather events.

Implementing partner will identify opportunities to strengthen critical infrastructure and equipment procurement planning that can reduce risk to investments.

Employ economic modeling that incorporates climate risk mitigation actions.

and associated regional market conditions.