MBA management

ENVIRONMENTAL ANALYSIS

The performance of a project may not only be influenced by the financial factors stated earlier. Other external environmental factors, which may be economical, social or cultural. May have a positive as well. The larger projects may be critically evaluated by lending institutions by taking into consideration the following factors:

1) Employment potential.
2) Utilization of domestically available raw material and other facilities.
3) Development of an industrially backward area as per government policy.
4) Effect of the project on the environment, with particular emphasis on the pollution of water and air that will be caused by it.
5) The arrangements for effective disposal of effluent, as per government policy.
6) Energy conservation devices, etc., employed for the project.

Meaning and Definition of Environmental Impact Assessment (EIA)

Environmental Impact Assessment (EIA) and the Environmental Impact Statement (EIS) are said to be the instrument through which the environmental management tries to accomplish its objective. The basic premise behind the EIS/ EIA is that no one has any right to use the precious environmental resources resulting in greater loss than gain to society. From this, it follows that the aim of EIS is to seek ways by which the project can proceed without any irreparable losses to environment and minimum losses if any, so that the net effect will be a desirable gain.

Environmental Impact Assessment (EIA is defined as, “An activity designed to identify, predict, interpret and communicate information about the impact of an action on man’s health and well-being (including the well-being of ecosystems on which man’s survival depends). In turn, the action is defined to include any engineering project, legislative proposal, policy program, or operational procedure with environmental implications.”

An EIA, therefore, is a study of the probable changes in the various socio-economic and bio-physical attributes of the environment, which result from a proposed action.

On the other hand, Environmental Impact statement (EIS) is defined as: A report, based on studies, disclosing the likely or certain environmental consequences of a proposed action, this altering the decision-maker, the public and the government to environmental risks involved; the finding enable better informed decisions to be made, perhaps to reject or defer the proposed action or permit it subject to compliance with specific conditions.

The EIS is a document prepared by an expert agency on the environmental impact of a proposed action/project that significantly affects the quality of environment. The EIS is used mainly as a tool for decision- making. At times, the EIA and EIS are used interchangeably as synonyms. But both are difference between the two is that the EIA is carried-out by the expert agency while the EIS as a tool is given to the decision-makers in different formats. As a matter of fact, the EIS is the outcome of EIA.

Objectives of EIA

1) To identify and describe (in as quantified manner as possible) the Environmental Resources/ values (ER/Vs) or the environmental Attributes (EA) which will be affected by the proposed project, under existing or “with or without project” conditions.

2) To describe, measure and assess the environmental effect that the proposed project will have on the ER/Vs (again, in as quantified manner as possible), including positive effects which enhance ER/Vs as well as the negative effects which impair them. Direct or indirect and short-term or long-term effects are to be considered. This would also include the description of the specific ways by which the project plan or design will minimize the adverse effects and maximize positive effects.

3) To describe the alternatives to the proposed project which could accomplish the same result but with a different set of environmental effects. Energy generation by thermal, hydel and nuclear would explain the case in point. Further, alternative locations are also considered.

Guidelines on the Scope and Contents of EIA

The following are the accepted points to be covered in an EIA study / report:
1) A description of the project proposed action; a statement of its purpose and a description of all relevant technical details to give a complete understanding of the proposed action, including the kinds of materials, manpower/resources, etc., involved.
2) The relationship of the proposed action to the land-use plans, policies and controls in the affected area or the project- vicinity. It is necessary to gain a complete understanding of the affected environment.
3) The probable impacts of the proposed project on environment are a very important aspect to be considered in details. It is necessary to project the proposed action into the future and to determine the possible impacts on the environmental attributes. The changes are to be quantified wherever possible.
4) Alternatives to the proposed action, including those not within the existing authority/ agency.
5) Any probable adverse environmental effect that cannot be avoided and stating how each avoidable impact will be mitigated.
6) The relationship between local short-term uses of man’s environment and thee maintenance of and enhancement of long-term productivity.
7) Any irreversible and irretrievable commitments of resources (including natural, cultural, labor and materials).
8) An indication of what other interests and considerations of government policy or program are through to off-set the adverse effect identified.

Process of EIA

The EIA process makes sure that environmental issues are raised when a project or plan is first discussed and that all concerns are addressed as a project gains momentum through to implementation. Recommendations made by the EIA may necessitate thee re-design of some project components, require further studies, and suggest changes which alter the economic viability of the project or cause a delay in project implementation. To be of most benefit it is essential that an environmental assessment is carried out to determine significant impacts early in the project cycle so that recommendations can be built into the design and cost- benefit analysis without causing major delays or increased design costs. To be effective once implementation has commenced, the EIA should lead to a mechanism whereby adequate monitoring is undertaken to realize environmental management. An important output from the EIA process should be thee delineation of enabling mechanism for such effective management.

The way in which an EIA is carried-out is not rigid: it is a process comprising a series of steps. These steps are outlined below:
1) Screening,
2) Scoping,
3) Prediction and mitigation,
4) Management and monitoring,
5) Audit,

1) Screening: Screening is the process of deciding on whether an EIA is required. This may be determined by size (e.g., greater than a predetermined surface area of irrigated land that would be affected, more than a certain percentage or flow to be diverted or more than a certain capital expenditure).Alternatively it may be based on site-specific information. The output from the screening process is often a document called an Initial Environmental Examination or evaluation (IEE). The main conclusion will be a classification of the project according to its likely environmental sensitivity. This will determine whether an EIA is needed and if so to what detail.

2) Scoping: Scoping occurs early in the project cycle at the same time as outline planning and pre-feasibility studies. Scoping is the process of identifying the key environmental issues and is perhaps the most important step in an EIA. Scoping is important for two reasons:
i) So that problems can be pinpointed early allowing mitigating design changes to be made before expensive detailed work is carried out.
ii) To ensure that detailed prediction work is only carried-out for important issues.

It is not the purpose of an EIA to carry-out exhaustive studies on all environmental impacts for all projects. If key issues are identified and a full EIA considered necessary then the scoping should include terms of reference for these further studies.

3) Predictions and Mitigation: Once the scoping exercise is complete and the major impacts to be studied have been identified, prediction work can start. This stage forms the central part of an EIA. Several major options are likely to have been proposed either at the scoping stage or before and each option may require separate prediction studies. Realistic and affordable mitigating measures cannot be proposed without first estimating the scope of the impacts, which should be in monetary terms wherever possible. It then becomes important to quantify the impact of thee suggested improvements by further prediction work. Clearly, options need to be discarded as soon as their unsuitability can be proved or alternatives shown to be superior in environmental or economic terms, or both. It is also important to test the “without project” scenario.

An important outcome of this stage will be recommendations for mitigating measures. This would be contained in the Environmental Impact Statement. Clearly, the aim will be to introduce measures which minimize any identified adverse impacts and enhance positive impacts. Formal and informal communication links are needed to be established with tams carrying-out feasibility studies so that their work can take proposals into account.

4) Management and Monitoring: The part of the EIS covering monitoring and management is often referred to as the Environmental Action Plan or Environmental management plan. It not only sets-out the mitigation measures needed for environmental management, both in the short and long-term, but also the institutional requirements for implementation. The term ‘institutional’ is used here in its broadest context to encompass relationships:
i) Established by law between individuals and government,
ii) Between individuals and groups involved in economic transactions,
iii) Developed to articulate legal, financial and administrative links among public agencies,
iv) Motivated by socio-psychological stimuli among groups and individuals.

The purpose of monitoring is to compare predicted and actual impacts, particularly if the impacts are either very important or the scale of the impact cannot be very accurately predicted. The results of monitoring can be used to manage the environment, particularly to highlight problems early so that action can be taken. The range of parameters requiring monitoring may be broad or narrow and will be dictated by the ‘prediction and mitigation’ stag of the EIA. Typical areas of concern where monitoring is weak are: water quality, both inflow and outflow; stress in sensitive ecosystems; soil fertility; water related health hazards; equity of water distributions; groundwater levels.

5) Auditing: In order to capitalize on the experience and knowledge gained, the last stage of an EIA is to carry-out an Environmental Audit sometime after completion of the project or implementation of a program. It will therefore usually be done by a separate team of specialists to that working on the bulk of the EIA. The audit should include an analysis of the technical, procedural and decision- making aspects of the EIA.

Technical aspects include:
i) The adequacy of the base-line studies,
ii) The accuracy of predictions and the suitability of mitigation measures.

Procedural aspects include:
i) The efficiency of the procedure,
ii) The fairness of the public involvement measures, and
iii) The degree of coordination of roles and responsibilities.

Decision-making aspects include:
i) The utility of the process for decision–making, and
ii) The implications for developments.

Some Major Issue in the Preparation Of EIA

The following are the major issues reported to be encountered commonly while conducting and preparing the EIS/EIA. Some of the issues cannot be resolved. In the absence of better alternatives, the analyst has to accept the issues as they are:

1) Determining the Environmental Impact: this is the central theme in any EIS/EIA. It is a very complex process. At the out-set, a distinction has to be made between the environmental impact and the changes in environmental attributes. Our interest is on the “impacts” and not on the ‘changes’, which normally take place even without the project. The determination of environmental impacts involves:
i) Identification of impacts on environmental attributes or the ER/Vs,
ii) Measurement of impacts on attributes, and
iii) Aggregation of impacts on attributes to reflect the total impact on environment.

2) With and without the Project: The environmental impacts are measurement of attributes with and without the project or activity at a given point in time. But thee changes in the attributes take place over time without thee activity. Therefore, the impact must be measured in terms of “net” change in the attribute at a given point in time.

3) Identifying the Impacts: The number of attributes to be practically infinite because any characteristic of the environment is considered to be attribute. Therefore, they have to be reduced to manageable numbers. Thus, duplicative, redundant, difficult to measure and obscure attributes may be eliminated in favor of those that are more tractable. This implies that some attributes, which are difficult to measure or conceptualize, may still remain to be examined. In this case, bias and subjectivity are likely to be crept in.

4) Characteristics of the Base: Conditions to the Activity: The nature of the impact is determined by the conditions of the environment existing before the project. The assessment of the characteristics of the bas is a critical factor.

5) Role of Attributes: Though thee impacts are considered to be the effects on the definite discrete attributes of the environment, the actual impacts are not correspondingly well categorized. Nature does not necessary respect man’s discrete categories. Rather, the actual impact may be the effect of varying severity on a variety of interrelated attributes. The issue is one of identifying and assessing the cause condition effect in order to work-out the remedial measures.

6) Measurement of Impact: Ideally, all impacts must be translatable into common units. However, this is not possible because of the difficulty in defining impacts in common units (e.g., on income and on water quality). In addition, the quantification of some impacts may be beyond the state of the art.

7) Aggregation Problem: After measuring the project impacts on various individual attributes or ER/Vs, one encounters the problem of how to aggregate all impacts (quantitative), thus assessed to arrive at a single composite measure to represent the “total activity impact’. This would involve expressing the various impact measures in common units, which is very difficult. Some use a weighting procedure to accomplish this, which is again subjective. There is another associated problem of summing-up and comparing with the impact of an alternative activity.

8) Secondary Impacts; Secondary or indirect impacts on environment should also be considered particularly in relation to the infrastructure investments that stimulate or induce secondary effects in the form of associated investments and changed patterns of social and economic activity. Such induced growth brings significant changes in the natural conditions. Similarly, there can be significant secondary impacts in the bio-physical environment.

9) Cumulative Impact: Here, accumulation refers to thee similar activities spread over in an environmental setting hotels, beach, resorts, surface or underground mines, industrial estates, etc. A single individual activity may produce a negligible effect on environment. However, a series of similar activities may produce significant cumulative effects. Therefore, it is suggested to prepare an Environmental Impact Assessment (EIA) on broad programs rather than on a series of component actions (e.g., industrial estates, mining sector, tourism industry, etc.). Or, alternatively, one can prepare an EIA for a particular geographical area where a series of similar activities are located (e.g., mining areas, coastal line for beach resorts, etc.).

10) Reporting Finding: The result should be displayed in such a way that it makes easy and clear to comprehend the total impacts of an activity from a brief review. It is suggested to display the impacts on a summary sheet in a matrix from.

Impact Assessment Methodologies

The impact identification and assessment can be made through several ways. There are six different methodologies in the literature based on the way the impacts are identified and assessed.

1) Ad Hoc: These methodologies provide a minimum guidance for impact for impact assessment. They merely suggest broad areas of possible impacts (e.g., impacts on lakes, forests, etc.), rather than defining specific parameters to be investigated. This is given exogenously to the analyst.

2) Overlays: These methodologies depend upon a set of maps on the environmental characteristics (Physical, social, ecological and aesthetic) of the proposed project’s vicinity. These maps are overlaid to produce a composite characterization of the proposed project’s vicinity. These maps are overlaid to produce a composite characterization of the regional environment. Impacts are then identified by noting thee impacted environmental attributes within the project boundaries.

3) Checklists: The methodologies present a specific list of environmental attributes to be investigated for possible impacts. They need not necessarily attempt to establish the cause-effect links to project activities. They may or may not include guidelines about how attribute data are to measured and interpreted.

4) Matrices: These methodologies incorporate a list of project activities with a checklist of potentially impacted environmental attributes. Then the two lists are related in a matrix form, which identifies the cause-effect relationship between specific activities and impacts. The matrix methodologies may either specify which actions affect, which attributes, or may simply list the range of project activities and environmental attributes in an open matrix to be completed by the analyst.

5) Networks: These methodologies work from a list of project activities to establish cause- condition-effect relationship. It is generally felt that a series of impacts may be triggered by a project action. They define a set of possible and allow the user to identify impacts by selecting and tracing- networks out the appropriate project actions.

6) Combination Computer-Aided: These methodologies use a combination of matrices, networks, analytical models and a computer-aided systematic approach. Since, this is a combination of difficult methodologies, it is a multiple-objective approach to:
i) Identify activities associated with the governmental policies and programs,
ii) Identify potential environmental impacts at different levels,
iii) Provide guidance for abatement and mitigation techniques,
iv) Provide, analytical models to establish cause-effect relationships and to quantitatively determine potential environmental impacts and
v) Provide a methodology and a procedure to utilize this comprehensive information in decision-making.

Limitations of EIA

Despite the success of EIA as a policy approach, in practice there have been two important shortcomings in its use as a planning tool in the Asia-Pacific region:
1) Severe problems have often arisen with the objectivity of EIA reports,
2) Preparatory work by regulatory authorities, primarily prior agreements on the scope or terms of reference for EIAs, has often missed opportunities for directing sound analysis towards the major environmental problems or opportunities associated with a given project.

Though RIAs are meant to improve project design and decision-making, this is often overlooked in practice. They too frequently are seen only as a stumbling block to investment. Furthermore, it has become common for oversight of the EIA process to be vested in the same line department responsible for promoting development of that sector. This often places environmental staff at odds with others in the department whose principal objective is to encourage investment in, e.g., mining, agriculture, or transportation. Project proponents-conduct EIAs, and it is easy to see that such groups may be reluctant to severely criticize project design if thee proponent is paying their bills and government oversight is weak.

The second major shortcoming in the application of EIA policies in the Asia-pacific region relates to their scope of analysis. The most common methods employed are based on a checklist approach wherein a pre-set range of potentially negative environmental impacts-sometimes refined according to the sector involved-is reviewed and the likelihood of adverse outcomes assessed .EIAs rarely attempt to fully quantify the environmental effects of project-induced change (e.g., the numbers of people with specific types of adverse health conditions resulting from air pollution or the reductions in crop yields due to erosion).They almost never describe these impacts in monetary terms.

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