Most projects will be required to pass an Environmental Impact Assessment(EIA). Environmental issues may be related to a number of different aspects, which can be grouped in two categories.
The EIA is produced by environmental authorities (or produced by the government and then reviewed by the environmental authority), and the result may cause severe impacts on the project both in terms of costs and delays. The EIA may require a change in the location of the project or other concrete changes in the project design, including the redefinition of the route in a linear infrastructure project. Another impact on the project cost may be the need to include specific measures to mitigate impacts or protect environmental values.
The procuring authority may not control the EIA as this is commonly issued by an independent or a separate agency within the government, or the agency may belong to another level of government (for example, a regional or state government).
Environmental impacts have to be anticipated as far as possible by the authority in order to limit or mitigate this risk for the benefit of both parties.
The project specifications defined at the time the tender is issued have to comply with environmental regulations and impacts addressed in an environmental plan. The project’s preliminary design or the outline should also have been tested with the appropriate environmental agency. In some countries, it is common to ask for the issue of a preliminary environmental assessment (for example, in Nigeria the authority does the preliminary ESIA, and the winning bidder does the more detailed one).
The risk of a negative EIA or an EIA that impacts on the project design is usually borne by the private party. This can be caused by any changes or developments of the project specifications, or when such developments are outside the boundaries or guidelines provided by the EIA. Also, the private partner will remain affected by environmental liability during the Operations Phase.