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From Savannakhet to Somerset: United by controversial EDF megaprojects

Two controversial energy infrastructure megaprojects located on opposite sides of the world, one in Western Europe and the other in Southeast Asia, are linked in more subtle ways than the most obvious bond i.e. they share the same main project developer. Hinkley Point C (HPC) nuclear power station, proposed to be built in the English county of Somerset and the Nam Theun 2 (NT2) Hydropower Project in operation since 2010 in central Laos are both megaprojects awarded to the French state-owned power utility, Électricité de France (EDF) as the main developer and shareholder in the respective project consortia.

Both projects are touted by their proponents as low-carbon energy alternatives to fossil fuel burning power plants that are designed to economically supply perceived unmet energy demands; both represent the biggest infrastructure projects the respective host nations have built at the time of construction; both projects have considerable externalities not being shouldered by the developers due to taxpayer subsidised risk guarantees; and both are mired in complex multi-stakeholder debates over their socio-economic and environmental sustainability credentials.

Beyond these similarities, both HPC and NT2 share a common pattern of politicisation at the highest levels of government, both at home and abroad, as vested interests clamour for each project to proceed at whatever the cost (both financially and politically). This situation inevitably leads to some serious political and economic distortions and inherent risks that emerge with time, that could have been avoided had less high profile, cheaper, smaller, more accountable, devolved and transparent energy projects been developed. Thus, it might be an interesting exercise to compare these two megaprojects and see if any wider lessons can be drawn from the common linkages discernible, despite the significant physical distance and domestic development context that separates them.

Nam Theun 2 – a dam too far for EDF and the Banks?

As the historically older case, this hydropower project had an extended period of gestation between initial development plans being proposed and eventual construction many decades later. A pre-feasibility study was first conducted in 1986, although basin planners with the multi-lateral river basin organization, the Mekong Committee, had already identified the dam site as holding potential for hydropower generation in the 1960s[1]. With the Indochina War being expedited across Laos (as “the other theatre”) and eventual 1975 regime change in Laos ushering in a one party communist state, geo-political conditions were not conducive for the project to be resurrected until the early 1990s, when the plans were dusted off once more by international actors.

The 39 m high Nam Theun 2 dam under construction in 2008. Much of the work was sub-contracted out to Thai construction companies and the cement was sourced from over 600 kms away in Saraburi, Thailand (Source: International Rivers)

The 39 m high Nam Theun 2 dam under construction in 2008. Much of the work was sub-contracted out to Thai construction companies and the cement was sourced from over 600 kms away in Saraburi, Thailand (Source: International Rivers)

It took ten years in the appraisal and preparatory stage from 1995 before final approval by the World Bank’s Executive Directors in lending countries was granted, thereby rubber-stamping the proposed social and environmental safeguards to mitigate and compensate for project impacts. This approval followed a year long period of “public consultations” and “participatory workshops”, conducted both internationally and domestically (though it was widely acknowledged that no meaningful participation was possible in the Lao context). In no reasonable sense could the developer claim to have gained broad public acceptance or employed a “fair, informed and transparent decision-making process”, according to World Commission on Dams principles, given the depth of opposition expressed by civil society globally.

I attended the Bangkok leg of the “technical consultations” held in August 2004, at which numerous civil society actors and dam-impacted villagers from Thailand, including a handful of impactees from the World Bank-funded Pak Mun dam, gave a series of heartfelt and well-reasoned arguments why it was an ill-conceived idea to build the NT2 dam project. The Pak Mun dam in Northeast Thailand became infamous for the multiple impacts it caused to fisheries and aquatic resources based livelihoods, sparking local protests and wider social conflict that still simmers today. But the Bank officials brushed off the objections with their own technocratic arguments as to why constructing the project was Laos’ only option to deliver it from abject poverty through electricity revenue generated and develop economically based on a rational utilisation and export of its natural resource asset base. At all the other consultations worldwide, voices of opposition outweighed those in support both in terms of numbers and credibility of the arguments presented. However, it was clear the decision to proceed had been taken long before the consultations were held and the World Bank was more interested in issuing a “blank cheque” to the developers, as maintained by David Hales of the Worldwatch Institute who chaired the public workshop on NT2 in Washington in September 2004.

The NT2 Hydropower Company (NTPC) that built, owns and operates NT2 is itself a consortium of three main shareholders, namely EDF International (40 %), the Electricity Generating Public Company of Thailand (EGCO) (35 %), and the government of Lao PDR’s Laos Holding State Enterprise (25 %). NTPC sell 90 % of the power generated from the 1,070 MW installed capacity plant to the Electricity Generating Authority of Thailand (EGAT), with the remainder consumed domestically in Laos.

Construction officially began in November 2005 and NT2 was commissioned in March 2010, having cost about $1.45 billion, with funding derived from multiple sources, including France’s Coface, Sweden’s EKN, Norway’s GIEK, the ADB, Multilateral Investment Guarantee Agency, the World Bank, the French Development Agency, the Export-Import Bank of Thailand, Nordic Investment Bank, nine international banks and seven Thai banks. The Lao government’s equity share in NTPC was financed chiefly by a loan from the European Investment Bank (EIB) and Asian Development Bank (ADB), with the multi-lateral banks providing political risk guarantees to the developers and private lenders, in effect, thus placing the main burden of risk on taxpayers in the contributing countries and into the future, with the Lao people.

Due to its size, prestige and symbolic nature, NT2 neatly embodied for all representatives of the temporarily thwarted dam building industry (domestically and internationally) a significant step towards the realisation of the popular narrative created that Laos could become the “Battery of Asia” or “Kuwait of Southeast Asia”, if the slumbering nation could only maximise the development of its hydropower potential. Technically, the dam project appears to have performed reasonably, but socially and environmentally the dam has been a predictable disaster, with the impacts falling particularly heavily on the downstream riparian people living along the Xe Bang Fai river in Khammouan and Savannaket provinces.

The downstream channel constructed below the power station takes 350 m3/s of turbinated water down to the Xe Bang Fai river, adding significantly to its normal background flows and seriously impacting the aquatic ecology and river-dependent livelihoods (Source: Aurecon Group)

The downstream channel constructed below the power station takes 350 m3/s of turbinated water down to the Xe Bang Fai river, adding significantly to its normal background flows and seriously impacting the aquatic ecology and river-dependent livelihoods (Source: Aurecon Group)

A significant, but invariably overlooked, historical feature of NT2 and the manner in which funding approval was granted by the multi-lateral banks, relates to the highly politicised nature of the campaign pushing for its development,  that included being able to harness the support of national leaders at critical moments. At one point in late 2004, it seemed like commitment was wavering from several crucial parties to backing the project, including some ambivalence on the French and American sides as to whether this was a worthy project to be involved in, given the patently high social and environmental impacts that would result and rising voices of opposition. Seemingly in a carefully calculated bid to sway any doubters of the project’s strategic importance, proponents started playing the “China card”, suggesting that if the Western institutions failed to back it, then China would fill the gap in a trice and takeover the project. This scare tactic seemed to do the trick, because French President Jacques Chirac was understood to have intervened and secured European loans and grants to secure EDF’s central involvement, a fact tacitly acknowledged by the French Ambassador to Laos at the project’s powerhouse construction inauguration ceremony in November 2005. The ceremony was also attended by the Lao Prime Minister, Bounnhang Vorachit and then Thai PM, Thaksin Shinawatra, representing the country likely to benefit most from the project in terms of immediate construction contracts, subsidised imported energy and externalisation of socio-ecological costs. Building large dams in Thailand has been controversial since the early 90s, thanks to an active civil society and relatively free media.

The Nam Theun 2 Hydropower Project (NT2) in central Laos and relative position of Savannakhet, where the bulk of the project’s power leaves Laos for the Thai market (Source: Baird and Quastel, 2015)

The Nam Theun 2 Hydropower Project (NT2) in central Laos and relative position of Savannakhet, where the bulk of the project’s power leaves Laos for the Thai market (Source: Baird and Quastel, 2015)

There were strong suspicions amongst civil society observers and energy analysts that the World Bank doctored its figures and used incorrect assumptions in order to make the economic argument for the dam stack up, prior to final appraisal in March 2005. Civil society critics had always argued that there was no credible economic case for the NT2 project going ahead, above and beyond its poor social and environmental score sheet, as the amount of electricity it was supposed to produce for export could easily be covered by demand side management in the Thai energy market. At least 153 NGOs recorded their opposition to the dam project going ahead during the evaluation phase.

In 2011, the World Bank published a report entitled “Doing a Dam Better: the Lao People’s Democratic Republic and the story of Nam Theun 2”, in which it is claimed the story of NT2’s development would provide “valuable insights and lessons that can be applied in future projects of similar size, scope, and complexity”. It was also held up as “strong evidence” of the Bank’s re-engagement in and commitment to supporting the large hydropower sector, after a decade-long hiatus prior to and after the seminal World Commission on Dams (WCD) report. Thus, the NT2 project fulfilled many functions for the dam lobby, not only in terms of Laos but worldwide, as a harbinger of renewed lending for “high risk, high reward” hydraulic development projects. And sure enough, it did open up a flood of cheap finance, subsidies and externalisation of risk for the ever-thirsty industry across Asia, Africa and Latin America.  The World Bank’s storyline of success with the project has continued since, despite the many reports issued that challenge this stale narrative with compelling evidence, including those from the project’s own Panel of Experts (PoE), but also numerous civil society studies conducted.

The project is expected to generate total revenue of $1.9 billion over the course of its 25 year concession period, of which some 25 % should, in theory, make it into Lao government coffers to help fund rural poverty alleviation programmes. However, because the project’s financial arrangements are so murky, particularly on the Lao government side, there is no guarantee in place that the funds generated will be spent where they were originally intended. Due to a culture of intense secrecy and unaccountability within the heart of Lao state governance, it is uncertain to what extent dividends, taxes and royalties from NT2 have been directed towards social security, education or health programmes. Without an independent audit, suspicions remain that revenues are just co-mingled with other public resources or even mis-appropriated, calling into question any claims by the Banks of a “model project” in water or energy governance. Tellingly, a spate of subsequent hydropower projects in Laos have ignored the long list of “safeguards” touted as the new standard by the NT2 proponents and fast-tracked dam construction without even basic public consultations. In Transparency International’s 2015 Corruption Perception Index, Laos was ranked 139th out of 168 nations worldwide.

Children bathe in the dam’s 450 km2 Nakai reservoir near a resettlement village. Despite assurances by the developers to remove all vegetation prior to flooding, much of it was left and is slowly rotting in the water (Source: FIVAS)

Children bathe in the dam’s 450 km2 Nakai reservoir near a resettlement village. Despite assurances by the developers to remove all vegetation prior to flooding, much of it was left and is slowly rotting in the water (Source: FIVAS)

Meanwhile, most of the goals of the social and environmental mitigation programme remain unmet, while many of the impacts identified by critics (and some additional ones) have been borne out in practice. Resettled families have not been made demonstrably better off and many are still reliant on dwindling material handouts from the NTPC and Lao government to survive, while downstream along the Xe Bang Fai recipient river in Khammouan and Savannakhet provinces, fish populations have crashed and riverside vegetable gardens lost amongst a catalogue of impacts, impoverishing the livelihoods of the tens of thousands of people that once relied on them. Rainy season flooding has been exacerbated by the power station additional flows, further eroding the sustainability of local livelihoods through destruction of rice crops. Meanwhile natural forests have been destroyed and wildlife decimated in the “protected area” in the headwaters of the NT2 reservoir, despite the assurances of the dam proponents that the project’s development would ensure their protection.  As Professor Thayer Scudder, an eminent global expert on the social impact of dams, Commissioner for the World Commission on Dams and one of the three person Panel of Experts for the NT2 project, commented in a New York Times article in August 2014, after nearly two decades spent closely monitoring the dam’s development process, “Nam Theun 2 confirmed my longstanding suspicion that the task of building a large dam is just too complex and too damaging to priceless natural resources”.

 

Hinkley Point C – more economic madness?

Nuclear power was first developed in the United Kingdom during the 1950s and 60s with the somewhat cornucopian promise of abundant clean, cheap and reliable energy for present and future generations to benefit from. The British public generally believed the claims made by the industry and politicians, so little overt opposition to nuclear energy (unlike nuclear weapons) appeared until the first large-scale nuclear accident occurred at Three-Mile Island in 1979 followed six years later by nuclear meltdown disaster at Chernobyl. These events and various setbacks within the industry prompted a much wider debate about the technology with a resulting fall in public support. At its peak in 1997, nuclear power generated 27 % of the nation’s electricity, but this has subsequently declined to about 18.5 % (in 2012) from 15 nuclear reactors, as the original fleet of power stations has been gradually retired for decommissioning and not been replaced. Based on rhetorical concerns about future energy security and pressures to reduce national emissions of carbon dioxide, the UK government announced in 2008 that it had given the go-ahead for a new generation of nuclear power stations to be constructed, with eight potential sites announced the following year, one of which was Hinkley Point.

This move proved controversial, with many NGOs, including Greenpeace, Friends of the Earth, the Campaign for Nuclear Disarmament and the World Wildlife Fund opposing the shift back to nuclear power solutions, on the basis of uncertain cost-benefit appraisal, the opacity of the planning process and environmental concerns. By marked contrast with NT2, nuclear plants like HPC do not require the resettlement of 6,500 households nor do they have the same direct negative impacts on the livelihoods of tens or hundreds of thousands of people, so the short term social and environmental impacts could be said to be more limited and manageable. However, the long term environmental and health impacts and risks posed are less favourable, due to the problems of nuclear material transport to and from site, safe disposal of radioactive waste and plant decommissioning issues passed on to future generations to resolve.

After a long period in the consultation and planning stages, a third reactor is scheduled to be built alongside two existing plants at the Somerset coastal site, namely Hinkley Point A (Magnox reactor) and B (Advanced Gas-cooled Reactor). The landscape-dominating plants occupy a low-lying, rural spot barely above sea-level next to the Bristol Channel, famed for having the second highest tidal range in the world after the Bay of Fundy, eastern Canada. This fact is material, when considering the United Kingdom’s energy futures in an era of awareness of the need to build alternative, safe and sustainable energy sources to mitigate predicted climate change. The UK government is legally committed to a gradual decarbonisation of the nation’s energy production mix up to 2050.

A view across Bridgwater Bay to the Hinkley A and B power station site. HPC will be developed alongside, at an estimated cost of £ 18 billion (David J.H. Blake)

A view across Bridgwater Bay to the Hinkley A and B power station site. HPC will be developed alongside, at an estimated cost of £ 18 billion (David J.H. Blake)

While the original A plant closed in 1999 and is being decommissioned, Hinkley B is still operating under EDF ownership and is not expected to cease operations until at least 2023. The entire site is vulnerable to future increases in sea levels, something that was not well understood when Hinkley A and B were built, but should be a high priority for HPC planners. In 1607, a major tsunami is recorded as engulfing much of this coastline and killing an estimated 2,000 people, but neither this historical event nor future predicted sea level rises of at least two metres by the end of this century and more severe weather events precipitated by climate change seems to have dampened the appetite of the proponents to push ahead with HPC, regardless of potential risks. When I visited the site in early April 2016 at high water on a spring tide, the sea was already lapping over the first line of concrete defences around the existing reactors (see picture). I can foresee extra marine erosion and flood protection measures, adding further to the costs of the project in the foreseeable future.

The coastal perimeter of the HPC site is threatened with coastal erosion, expected to worsen in future under conditions of rising sea levels, stormier weather and an underlying soft geology (David J.H. Blake)

The coastal perimeter of the HPC site is threatened with coastal erosion, expected to worsen in future under conditions of rising sea levels, stormier weather and an underlying soft geology (David J.H. Blake)

HPC was originally proposed by the government as an ideal solution to “keeping the lights on” in a climate change challenged world, able to supply 7 % of the UK’s present energy needs at a single location, through a 3,200 MW installed capacity and reliably high plant load factor[2]. The trouble is, the European Pressurized Reactor (EPR) design EDF have proposed to use is thus far unproven technology and at the four other sites where a similar nuclear reactor type is being constructed in France, Finland and China, the projects have been dogged by unforeseen technical problems leading to steep cost and time overruns.

During a spring tide in early April 2016, the sea breached the first line of sea defences near the plant. In 1607, this coastline was struck by a major tsunami that swept many miles inland and drowned thousands (David J.H. Blake)

During a spring tide in early April 2016, the sea breached the first line of sea defences near the plant. In 1607, this coastline was struck by a major tsunami that swept many miles inland and drowned thousands (David J.H. Blake)

As a political party, the incumbent Conservatives have traditionally offered strong support for nuclear power, although up until a few years ago the leadership insisted that it should not be subsidised by the taxpayer but subject to normal market forces and open competition. However, this stance shifted under the Conservative-Liberal Democrat coalition government (2010-15), when ministers decided that the UK should pursue a nuclear-fuelled future, with the provision of state subsidies to sector investors, riling both free-marketeers and renewable energy campaigners alike. This policy position remained unchanged even after the sobering wake-up call of the potential dangers surrounding nuclear power delivered by the March 2011 Fukushima disaster. Yet the British public have proven far less averse to nuclear power than the German population, perhaps partly because the former have been fed a regular line from the government that without further nuclear development the UK may be looking at future brown-outs. Such a fear-invoking narrative was recently admitted to be a myth by the government’s own Secretary of State for Energy and Climate Change, when Amber Rudd publicly stated that the nation’s lights would not go out if it was not developed, as had been claimed by her predecessors.

Such admissions are grist to the mill for the national and local civil society opposition to Hinkley, movements like Stop Hinkley which have doggedly campaigned against the project for many years, long before HPC was proposed. Although such citizen groups are ideologically opposed to nuclear power development in principle, their economic arguments against the project have been given added weight in recent years by a number of studies by financial and economic analysts, such as Liberium Capital which described the strike price as “economically insane” and “as far as we can see this makes Hinkley Point the most expensive power station in the world.”

Despite the generous government guarantees provided by a strike price (at £92.50 per MW/h) for the electricity produced of over twice the current wholesale price for electricity in the UK, the parlous state of EDF’s finances and massive debt mountain mean that HPC is a risky proposition for the utility. Its own workers’ union opposes the project and in February 2016, Thomas Piquemal, EDF’s chief financial officer resigned, warning that building HPC could ruin the company. As a result, the French government has said it plans to provide financial support to EDF, a move that will likely fall foul of EU legislation to ensure fair competition in the energy market and disallow unfair state aid to individual companies, something that the UK government is already being challenged on in the European courts by the Austrian government. With national pride and the reputation of French nuclear technology potentially at stake (EDF is also looking to invest in China and other countries), a decision from the French government on whether to bailout EDF has been delayed time and again, and a decision is not now anticipated until at least September 2016.

One remarkable point of difference between NT2 and HPC is that with the former, China was portrayed by some as a threat to EDF and Western venture capital’s regional interests, had it been allowed to gain a stake in the dam project. With the benefit of hindsight, China was poised to build dozens of other dams in Laos, with or without EDF’s involvement. But now China is actively courted as a nuclear investment partner, both for the injection of funds it can offer, but also, potentially for its technological expertise. Indeed, the China General Nuclear Power Corporation has taken a one third stake in HPC, with the deal inked just hours before the state visit of President Xi Jinping to London in October 2015. Much to the chagrin of human rights groups, the President was afforded the red carpet treatment for his visit, with PM Cameron and Chancellor Osborne hoping HPC would be the springboard for further Chinese investment in nuclear power stations in Essex and Suffolk.

With the latest twist in the Hinkley saga looking like a legal challenge will be launched against the UK and French governments, one Southwest region Green MP referred to HPC as an uneconomic “white elephant” which is being pushed regardless, because there is “now a political battle where the stakes for both the UK and France are just too high to admit failure”.

Both NT2 and NPC would qualify as prime examples of what Danish economist Bent Flyvbjerg refers to as “Machiavellian Megaprojects”, which are shown to follow a time-honoured formula:

(underestimated costs) + (overestimated revenues) + (undervalued environmental impacts) + (overvalued economic development effects) = (project approval)

As Flyvbjerg stresses in his analysis of such megaproject development by a relatively few societal elites, the monomaniacal pursuit can frequently lead to the deception of “parliaments, the public and the media about the costs and benefits of the projects”.

It seems there is more linking the development paradigm of Savannakhet and Somerset than citizens in both the U.K and Laos may fully appreciate. There is still a glimmer of hope, however, that commonsense may prevail in London and Paris, and the HPC case of folie de grandeur may be stopped in its tracks. In the case of NT2, Laos has now been locked into a project with multiple negative social and environmental consequences, many irreversible such as permanent loss of valuable terrestrial and aquatic biodiversity, that will ultimately cost its citizens and the wider Mekong basin populations dearly into the future.

[1] Interestingly, in the address given by Pierre Lellouche, Minister of State with responsibility for Foreign Trade at the Nam Theun 2 project’s inauguration ceremony on 9 December 2010, he claimed that the site was first identified back in 1927 by an engineer, presumably of the French Indochina colonial government.

[2] The plant load factor is the ratio between the actual energy generated by the plant to the maximum possible energy that can be generated with the plant working at its rated power over the duration of a year.

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The Salween River is Not for Sale

TAUNGGYI, Shan state, Myanmar

It is billed to become the biggest dam in SE Asia. The Mong Ton dam project on the Salween River will flood a vast area, with a reservoir extending 380 km upstream over an area home to thousands of Shan and other ethnic groups in a region of important biodiversity.

It could well become Myanmar’s most controversial dam project since the Myitsone on the Irrawaddy. (This dam was suspended by President Thein Sein in 2010).

Sinohydro, The Three Gorges and Southern Power grid form a Chinese consortium with a 40 % stake in partnership with EGAT Thailand’s Electricity Authority (40%) and local partners IGE.

Kunhing villagers protest against Mong Ton Dam, April 30, 2015.

Kunhing villagers protest against Mong Ton Dam, April 30, 2015.

Thousands of villagers supported by civil society in the Shan state are angry that their Salween –the last undammed river of size and importance in the region- is being dragged into the nexus of ever expanding hydro-power and big business.

The strength of anti-dam sentiments took the EIA consultants by surprise at a recent public meetings in Shan state conducted by SMEC (The Snowy Mountain Engineering Corporation from Australia).

The Australian consultants have been engaged by the developers to conduct EIA and SIA – Environmental and Social Impact Assessments.

They received a hostile reception from hundreds of Shan people crammed into a small hall many of them sporting “No Dam “bandalas and placards.

The Smec consultants were told the assessment period was too short.The villagers have been told very little by the government and these corporations.

The recent protest against the gigantic Mong Ton dam project on Salween River is only one part of a growing anti- dam movement struggling to protect the culture and livelihoods of millions stretched across three ethnic states in Myanmar -Shan, Karen, and Kayah comprising diverse minority peoples.

Hundreds of kilometers to the south, Kesan – (the Karen Environmental Network) organized a Salween day to mark the global protection of rivers day March 14th 2015, to celebrate the river’s beauty and vital importance to ethnic peoples.

Up north the Mong Ton dam would flood pristine teak forests; the planned Hatgyi dam in Karen state would flood two wildlife north sanctuaries. Cultural and religious heritage sites will be inundated.

Banners defiantly proclaimed on the Thanlwin River/Salween in Myanmar: NO DAMS! THE SALWEEN IS NOT FOR SALE! On International Rivers Day of Protest celebrated on rivers around the world from the Amazon to the Mekong.

Ms Hsa Moo, a Kesan media coordinator addressed a crowd of several hundred Karen villagers. “When the government in Nay Pyidaw looks at the Salween River and other rivers in Burma, they don’t see its beauty: they only see Thai Baht, Chinese Yuan, US dollars and Indian Rupees. For them, the rivers flowing through the lands of our ethnic communities are nothing more than a potential source of revenue. Not revenue for local people, but for the central government:

They want to dam our rivers, sell most of the energy they generate to neighboring countries, and keep the money for themselves.’ She concluded “Our rivers are not for sale.”

Statements from the Naypidaw parliament indicate the government‘s prime concern is not with the potentially disastrous impacts, but with the country’s energy shortages.

In February 2013 the Deputy Minister of Power Myint Zaw told parliament that six hydropower dams had been approved for the Salween River, one of the region’s longest flowing for 2800 kms from the snow-capped mountains of Tibet, through China and Myanmar.

The projects in Shan State include the Kunlon, with a capacity of 1400 megawatts, Naungpha (1000MW), Mann Thaung (200MW) and Mong Ton(aka Tasang dam)   (7110MW). Other dams include Ywarthit (4000MW) in Kayah State and Hatgyi (1360MW) in Karen State.

Professor Maung Maung Aye chief advisor to the MEI –Myanmar Environment Institute speaking in a panel discussion in Yangon commented; “today damming the rivers is the government’s first principle for developing more energy, instead of being the last option for the nation.”.

The NGO Renewable Energy Association of Myanmar (REAM) also strongly criticized the government’s failure to adopt an energy policy that would include investment in solar power, wind power and other clean and green energy solutions that have recently dropped in price, and become far more affordable..

Upstream from Myanmar the Salween( Nujiang) in China had been the target for 13 dams in 2004. However in a dramatic reversal for Chinese hydropower, former premier Wen Jiabao declared a moratorium on dam construction on the River Nujang in response to a strong environmental campaign led by Green Watershed, supported by several Chinese geologists.

The Mong Ton (aka Tasang) dam will be by far the largest on the Salween River in Burma, producing 7,100 megawatts of electricity, 90 percent of which will be exported to China and Thailand.

The massive reservoir will stretch across almost the entire length of Shan State flooding huge areas and deluging hugely important areas of biodiversity and forest. Villagers who attended the recent SMEC –run consultation in early April, held up anti-dam placards and handed out a statement to the Australian staff, raising concerns about how the dam would threaten their livelihoods and trigger renewed armed conflict.

HYDRO- DAMS FUELLING CONFLICT

Nang Wah Nu, a representative from Shan State in Parliament reported last year that preparation work has already begun on monster Mong Ton dam designed to deliver 7000 mw of power, but only 15% for the Myanmar.

The Shan parliamentarian lamented “no information had been provided to residents who fear their homes, rice fields and pagodas will be flooded”. She warned   “Fighting could break out if the government does not discuss the project.”

Indeed fighting has broken out in the proximity of dam projects with more than 50 clashes recorded between armed ethnic groups and the army during the current period of peace talks according to the Burma Rivers Network coalition.

Fresh fighting has erupted in southern Shan State in March 2013, after the army launched an offensive against the Shan State Army-North to force its troops out of bases along the Thanlwin (Salween) located near dam sites in Nona Pha and Mong Tong. This forced the displacement of 2000 villagers in Tangyan township.

A spokesperson for Karen Rivers Watch reported that the army’s border guard force attacked the Democratic Karen Buddhist Army in May in an attempt to drive them away from the Hatgyi dam site. The villagers fled to refugee camps on the Thai border.”

Sai Khur Hseng, director of Sapwawa a Shan environmental network declared: “These conflicts have broken out despite the ceasefires. It is very clear that the Thanlwin (Salween) dams are fuelling war. If President U Thein Sein really wants peace, he should stop the dams immediately,”

The Myanmar government plans to sell electricity produced from the hydropower projects on the basis of agreements with five Chinese companies, one Thai company and three Myanmar companies. The ministry says Myanmar will get 15 percent of the electricity from the projects and the right to buy a further 25%.

These very serious and well- documented allegations have been raised in peace talks with the government.

Karen people protest against the Hat Gyi Dam and other dams on the Salween.

Karen people protest against the Hat Gyi Dam and other dams on the Salween.

THE HYDROPOWER DEBATE: The World Bank versus the World Commission on Dams and the Oxford Study.

In January 2015 the World Bank and its financial arm the IFC-International Finance Corporation organised a conference in Yangon to promote hydropower as an engine for economic growth, and as a solution for dealing with the nation’s energy problems held in Naypidaw.

The event was clearly aimed at tapping the huge influx of foreign investor’s rich eager to grab a stake in exploiting the nation’s rich natural resources.

Although heavily outnumbered by businessmen and bankers, a few ngos were allowed to raise serious challenges to the overwhelming pro-dam spirit of the conference. John Saw Bright a representative of Kesan –(the Karen environmental & social action network )made it clear to the conference , mega-dam projects like the controversial Myitsone dam have given dams a bad reputation in Myanmar.

A representative from Myanmar Peace Support similalrly observed “dams and hydropower do not have a beautiful name in Burma…”

THE WORLD BANK AND HYDROWER

At the Naypidaw conference in January 2015, the World Bank Group tried to counter the negative image of large-scale dams, with the simple mantra of “sustainable hydropower ““a slogan that has come to permeate all international discourse on dams.

Kate Lazarus from the IFC the financial arm of the World Bank commented, “a sustainable hydropower sector will help mitigate environmental and social risks, while realizing Myanmar’s huge energy potential, contributing to economic growth and shared prosperity.”(The Nation newspaper in Thailand)

Karin Finkelston, IFC’s vice president for global partnerships argued that “electricity is fundamental to reducing poverty and improving living standards for Myanmar’s people and hydropower is an important part of Myanmar’s energy future – but it has to be done in an environmentally and socially sustainable way.”

But all this begs the question of what is sustainable and does mitigation work? The World Bank and the IFC neglect to define the limits of sustainability. The test of unsustainability and the grounds for rejecting a dam-project cannot be found anywhere in their literature. It has also never been clarified by the Mekong River Commission.

Rhetoric and assurances do not guarantee that millions of people living on Burma’s great rivers, and their fisheries, farm crops, and their livelihoods, can be adequately protected from destruction, which normally follows in the wake of mega-dam operations.

In fact here the work of fisheries experts and scientists clearly demonstrates that World Bank policy runs counter to the conclusions of recent scientific reports including the World Commission on Dams and subsequent studies.

The most comprehensive study of hydropower dam impacts around the world concluded that most mega-projects had unleashed many problems and that the losses suffered usually outweighed the benefits.

The World Commission on Dams (2000) concluded ´Decentralised, small-scale options (micro hydro, home-scale solar electric systems, and wind and biomass system) based on local renewable sources offer an important near-term, and possibly long-term, potential particularly in rural areas far away from centralised supply networks.”

Renewable Energy Association of Myanmar (REAM), a civil society group, pointed out that most of the population in Burma lives in remote and off-grid areas. If the government and the World Bank Group genuinely aim to bring electricity to the local population, decentralized off-grid solutions are the best option, not large-scale hydropower dams for export.

International Rivers ngo view sustainable hydropower as a formula not for examining all energy options and defining criteria for stopping  a deeply flawed dam from being built, but rather a recipe for building ” better nicer dams” based on unproved technologies of mitigation.

Pai Deetes of International Rivers blogged “It is clear that the myth of “sustainable hydropower”, as it is being sold by the World Bank will simply not be accepted in Burma.

Just recently an Oxford University research study corroborated these conclusions. “The evidence is conclusive: Large dams in a vast majority of cases are not economically viable. Instead of obtaining hoped-for riches, emerging economies risk drowning their fragile economies in debt owing to ill-advised construction of large dams,” they said in a statement attached to the study, which was published on March 10: 2014 in the Energy Policy journal.

“The World Bank‘s claim that hydropower is “clean affordable, and reliable” is clearly contradicted by this study.

Bent Flyvbjerg, principal investigator for the Oxford University dam study, says dams “are not carbon neutral, and they’re not greenhouse neutral”. The vast quantities of concrete required to construct leave an enormous carbon footprint, he says.

Furthermore flooded vegetation under the reservoirs produces methane, a greenhouse gas roughly 20 times more potent than carbon dioxide, he says.

Co-author Bent Flyvbjerg, the founding chair of Major Programme Management at the school, said the findings against mega dams were so conclusive that only “fools” or “liars” would advocate for them.

Kunhing villagers protest against Mong Ton Dam. April 2015.

Kunhing villagers protest against Mong Ton Dam. April 2015.

CONCLUSION

Before the government and civil society consider following the World Bank neo-liberal model of development they should also heed the latest revelations from a global media investigation.

“Dams, power plants and other projects sponsored by the World Bank have pushed millions of people out of their homes or off their lands or threatened their livelihoods” the investigation found

The UK Guardian, the Huffington Post and other media, are currently    publishing a series of these investigation reports from the ICIJ (International Centre of Investigative journalism).

The ICIJ report concluded “The World Bank regularly fails to enforce its own rules protecting people in the path of the projects it bankrolls, with devastating consequences for some of the poorest and most vulnerable people on the planet.”

Many of the poorest and most vulnerable people constantly subject to military harassment, and enforced resettlement are the ethnic peoples of the Salween River.

If the Myanmar government is serious about bringing peace to the ethnic regions and ending civil war in the country, they have to think again about imposing mega-projects on the ethnic states without providing them any benefits or compensation.

Building or not building dams is about far more than foreign investment, selling energy to neighbouring countries and protecting the environment. It is intimately connected with a more equitable sharing of political power and natural resources between the central government and its impoverished ethnic regions.

This article was originally published in the May 14th issue of MIZZIMA Weekly. It is reprinted here, in its entirety, with full permission from its author.

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