Building Trust in Geothermal Projects: The Role of FPIC in Stakeholder Inclusion

The document provides a structured framework for implementing Free, Prior, and Informed Consent (FPIC) in geothermal projects, ensuring Indigenous communities are actively engaged in decision-making. It emphasizes legal frameworks, stakeholder engagement, land rights, risk management, and sustainability to foster ethical and inclusive development.

Research conducted by the International Finance Corporation (IFC), the United Nations Development Programme (UNDP), and Indonesia’s Ministry of Energy and Mineral Resources (MEMR) provides a detailed roadmap for integrating Free, Prior, and Informed Consent (FPIC) into geothermal energy projects, ensuring that Indigenous Peoples and local communities actively participate in decision-making processes. FPIC is a fundamental principle in international human rights law, designed to protect Indigenous rights and promote ethical and sustainable development. This guide details the legal frameworks, methodologies, governance structures, and best practices necessary for embedding FPIC into project planning and implementation.

Early Engagement and Trust-Building

One of the key takeaways from the document is the critical importance of early and continuous stakeholder engagement. Establishing trust with Indigenous communities at the outset is essential for the success of any geothermal project. Initial scoping visits serve as the first point of contact, allowing developers to identify potential legacy issues, assess the cultural and historical significance of the land, and develop consultation strategies tailored to community needs. Indigenous communities, particularly those with past negative experiences with development projects, may harbor skepticism and resistance toward new initiatives. The guidelines emphasize the need for transparent communication, facilitated by professional mediators, local leaders, and conflict resolution experts, to ensure that discussions remain constructive and inclusive. By addressing community concerns proactively, developers can avoid misunderstandings and foster goodwill.

Governance, Land Rights, and Legal Frameworks

A significant portion of the document focuses on the governance structures and legal frameworks that facilitate FPIC implementation. The guidelines introduce a multi-tiered governance model involving Advisory Councils (AC), Working Groups (WG), and FPIC Facilitator Organizations (FFO), which collectively ensure Indigenous participation in decision-making. Indigenous representatives are encouraged to play a key role in drafting essential project documents such as the Indigenous Peoples Plan (IPP) or Social Impact Management Plan (SIMP). These documents outline mitigation strategies for potential social and environmental risks and establish mechanisms for dispute resolution.

Land acquisition is a particularly complex aspect of geothermal project development in Indonesia. The guidelines highlight participatory community mapping as an effective tool to prevent land disputes and establish clear boundaries of Indigenous territories. Additionally, grievance redress mechanisms (GRM) are emphasized as essential components of FPIC, providing communities with formal channels to voice concerns, seek clarifications, and renegotiate agreements when necessary. By adopting these approaches, developers can minimize conflicts and build relationships based on mutual respect and legal accountability.

Addressing Environmental and Social Risks

Environmental and social impact assessments (ESIA) play a crucial role in FPIC processes, ensuring that communities are fully informed about the potential risks associated with geothermal projects. The guidelines stress the need for rigorous risk assessment and management measures, particularly in regions where biodiversity and Indigenous livelihoods are closely intertwined. The document also highlights the importance of gender-sensitive approaches, recognizing that women in Indigenous communities often have unique perspectives on land use and environmental conservation. Special efforts should be made to include women in consultations and decision-making, ensuring that their voices are heard and considered.

To mitigate social risks, developers are encouraged to establish targeted capacity-building programs, legal literacy workshops, and financial compensation models tailored to the needs of affected communities. These initiatives not only ensure compliance with FPIC but also contribute to the long-term socio-economic development of Indigenous populations.

Sustainability, Monitoring, and Adaptive Management

A key recommendation of the guidelines is the need for continuous monitoring and adaptive management to ensure that FPIC remains an ongoing process rather than a one-time formality. Periodic evaluations and independent third-party audits are suggested as mechanisms for tracking compliance with FPIC agreements. The guidelines also propose the establishment of Indigenous oversight committees, which would provide continuous feedback and assess the project's impact in real time.

A particularly innovative feature of the guidelines is the introduction of Tripartite Implementation Agreements (TIA), legally binding contracts between developers, Indigenous communities, and the government. These agreements provide Indigenous groups with legal recourse in case developers fail to meet their commitments, thereby reinforcing accountability and trust.

The document warns against common pitfalls that have historically derailed projects, such as making unrealistic promises, failing to address past grievances, and neglecting traditional governance structures. Developers are advised to invest in long-term community development initiatives—such as education programs, healthcare services, and infrastructure projects that align with the aspirations of Indigenous communities.

By implementing these guidelines, geothermal developers can secure a “social license to operate,” ensuring that projects progress smoothly with the support of local communities. The document underscores that successful development is not solely about economic feasibility or technological advancements but also about fostering trust, equity, and long-term partnerships. Through ethical and responsible stakeholder engagement, geothermal energy projects can contribute to sustainable development while respecting Indigenous rights and cultural heritage.