FREQUENTLY ASKED QUESTIONS ABOUT XAYABURY HYDROPOWER PROJECT
(POLICY) Q. Why is Laos building hydropower dams? Laos is rich in natural resources but poor in terms of capacity, infrastructure and workforce to spur industrialization. When the World Bank and Asian Development Bank ¬urged Lao PDR to attract private investment, hydropower was deemed to be the best opportunity. Since its founding, Lao PDR has gained valuable experience in hydropower development. For example, Nam Theun 2, completed in 2010, has been praised as a model of economic, environmental and social sustainability. Hydropower already accounts for about one-third of the nation’s capital wealth and further development is needed to aid economic growth and lift Lao people out of poverty. Laos has the potential to develop as many as 100 hydropower dams with a total capacity of 28,000 MW. As per December 31, 2012, there are currently 21 dams with install capacity larger than 1 MW in operation, with a total installed capacity of 2,910 MW.
Q. How does hydropower development serve national energy policy? The national energy policy of Lao PDR is to maintain and expand affordable, reliable and sustainable electricity so that the electrification ratio exceeds 90 percent by 2020 and renewable energy accounts for 30 percent of supply by 2025. With the goal of being the “Battery of Southeast Asia,” Laos is tapping its very large hydropower potential with the participation of private developers. Hydropower already contributes about 33 percent of the nation’s capital wealth. Hydropower development is the only way to create enough capital growth to enable Laos to leave Least Development Nation status by 2020.
Q. Why has Laos chosen hydropower over other forms of energy? Hydropower is reliable, clean, zero-carbon-emission and affordable, renewable energy that does not pollute the environment or consume water. No other method of power generation provides the additional benefits of water for irrigation and human consumption, as well as flood control and infrastructure improvement. Like many other countries, Laos wants to reduce dependence on fossil fuels, gas, oil and coal. Nuclear energy is not an option.
Q. Why doesn’t Laos heed the calls to stop hydropower development on the Mekong? Perhaps more than any other country, Lao PDR depends on the Mekong River for its survival. In Laos, the Mekong plays an iconic and spiritual role in people’s lives, sustains livelihoods, serves as a highway for the transport of goods and passengers, and attracts tourism. At the same time, Laos, like the nations of Europe and the Americas, has a sovereign right to develop resources within its boundaries for the good of its people. The Lao Government has retained world-renowned consultants, with vast experience developing successful and environmentally friendly hydropower projects on Europe’s international rivers. These consultants, including the Finnish company Pöyry and the French firm Compagnie Nationale du Rhône (CNR), have performed exhaustive technical and environmental studies to ensure that the Xayaburi project is built to international standards, to be efficient, sustainable, and without significant impact on the river or natural environment in Laos and beyond its borders. The Government of Laos and its development partners continue to be responsive to all concerns raised by legitimate parties.
(TRANSBORDER ISSUES) Q. Is approval from the Mekong River Commission (MRC) required? No. The 1995 Mekong Agreement established a voluntary framework and procedural rules to ensure cooperation of the Governments of Laos, Thailand, Cambodia and Vietnam for sustainable development of the Mekong River Basin. While it promotes cooperation, the Agreement also respects Member Countries’ sovereignty and right to develop. The Agreement includes Procedures for Data Information Exchange and Sharing; Procedures for Water Use Monitoring, and Procedures for Notification, Prior Consultation and Agreement (PNCPA). When it shared information about plans to develop a hydropower plant at Xayaburi, Laos became the first country to undergo the PNCPA process. That process has been completed. No further action by the MRC or its member countries is needed for the project. (Formal agreement of the Members is required only when a project diverts water from the mainstream of the Mekong in the dry season. The Xayaburi project is a non-consumptive use of Mekong River water.)
Q. What is the PNPCA / “prior consultation” process of the Mekong Agreement? The process ultimately ensures that the four riparian neighbors have full information about proposed projects and have a forum to voice their opinions. Laos fully complied with the process between October 2010 and April 2011 in accordance with agreed procedures. In doing so, Laos agreed to take into account all legitimate concerns of the Member Countries. Their principal concerns were river navigation, fish migration and passage, sediment transport, water quality and safety of the dam itself. To address these concerns, the Government commissioned additional consultant studies of technical aspects of the dam’s operations, and downstream effects on the ecology.
Q. Do Thailand, Cambodia and Vietnam support the project? Yes. The governments of Thailand, Cambodia and Vietnam have been consulted at every step along the way. On a government-to-government basis, there have been assurances that the riparian countries support the project.
Q. Will there be downstream impacts on Cambodia and Vietnam? No. The great water systems of Tonle Sap in Cambodia and the Mekong Delta in Vietnam lie more than 1,000 km from Xayaburi. Studies indicate the Xayaburi project will have no appreciable impact on flood levels in Tonle Sap or dry-season flows and salt incursion in the Mekong Delta. The natural cycles of these water systems will continue in the future as if there were no dam at Xayaburi. The project is too far upriver to on have an impact on fisheries in those countries. Other more local factors will have much greater impact on water levels, sediment, aquatic nutrients and fish in these areas.
Q. Are more studies needed? An Environmental Impact Assessment and a Social Impact Assessment for the Xayaburi project have been completed and approved along with an Environmental Management Plan and a Resettlement Action Plan. These will guide implementation of plans formulated by national and local authorities in consultation with affected communities. However, hydropower is not the only activity that impacts downstream communities. Future research can assess the present and potential impacts of domestic and commercial use all along the Mekong’s course, including pollution from industrial sites, transportation and irrigation, gold mining, sand mining and export, fishery practices like blast fishing and overfishing, riverbank erosion and global warming.
(XAYABURI SPECIFICS) Q. Why was the Xayaburi site chosen for a dam on the mainstream of the Mekong? Located about 100 km downriver of Luang Prabang in northern Laos, the site’s unique topography makes it ideal for hydropower development. Here, the Mekong River runs through a narrow valley in a sparsely populated mountainous area. The contours of the land and river banks and flow of the river are perfectly suited for a low “run-of-river” dam. This type of dam has no reservoir. It requires a small slope with a rather high mean flow so that the water level (head) is constant and can be sent to flow through the turbines or spillway year-round.
Q. What is a “run-of-river” dam? In a run-of-river scheme there is no high dam storing enormous amounts of water in the rainy season for release in the dry season. Rather, the dam is relatively low and water is kept within the river’s course. The level of impounded water is raised minimally to allow for passage of ships and fish migration. The hydrology (mean daily flow regime) of the river is not affected. Generally speaking, the amount of water that flows into the dam flows out of the dam, and the level remains fairly constant year round. Another way of saying this is, the input flow will equal the output flow. The Xayaburi scheme will raise the current river level at the barrage by about 38 m above mean minimum. The ponding effect will extend about 90 km upstream.
Q. Has this type of dam been built before? Yes. There are many successful run-of-river or “low-head” hydropower plants on the great international rivers of Europe, which leads the world in hydropower technology. The Rheinfelden power plant, 25 km east of Basel, Switzerland, harnesses the power of the Rhine River, which has 12 hydropower dams. The Freudenau plant near Vienna, Austria, is the latest and largest on the Danube River, which has 59 large dams in the first 1000 km. France has developed 19 hydropower dams on the Rhone River.
Q. Is Xayaburi the first dam to be built on the Mekong River? No. The Mekong River flows nearly 4,500 km from Tibet through China’s Yunnan Province, Myanmar, Laos, Cambodia and Vietnam, making it the 10th longest in the world. China has built four large storage dams on narrow gorges of the Mekong (called the Lancang in China) and two more are under construction there. The Xayaburi project will be the first on the mainstream of the Lower Mekong River Basin. Many storage dams have been built on tributaries of the Mekong, including the Nam Ngum, Nam Theun rivers in Laos, and the Nam Moon in Thailand. There are plans for other dams to be built on the mainstream in the future.
Q. What are the technical features of the Xayaburi Hydroelectric Project? The Xayaburi project is state-of-the-art, incorporating the very latest developments in hydropower production, the same technology that is being used to produce clean, renewable energy in Europe and the Americas. The structure will be an average of 40 m high and 820 m long. The installed capacity, or production capacity, will be 1,285 MW, with annual generation of 7,370 GWh. Electricity will be produced when river water rushes through turbines to drive generators. Eight turbine-generator sets will be installed in the powerhouse. Seven will be of 175 MW capacity; one of 60 MW capacity. Water reaches the turbines by passing through a large intake cone. Water leaves the plant via a draft tube. 16 kV power is led from the generators to transformers that bring the voltage up to 115 kV for Laos and 500 kV for Thailand. Seven large spillway gates will be capable of releasing the high floods of the Mekong safely in combination with four low-level gates for the release of sediment flows.
Q. What is a “transparent” dam? This term means that the water and aquatic resources that flow into the dam, flow out of the dam. No water is diverted from the river. There is no change in the water quality, nothing added, nothing taken from the water. The natural input flow equals the output flow. Sediment that becomes trapped in the dam temporarily is routinely flushed out to return to the river. Proven technologies are employed to prevent, avoid and minimize all environmental and social risks with regard to fishery resources, sediment flushing, navigation, river bank erosion and maintenance of natural water quality.
Q. How was the original design modified in response to consultation? Internationally recognized engineers addressed the most pressing concerns of MRC member countries, including sediment transport and flow levels. Based on a series of hydraulic engineering tests on a scale model of the Xayaburi site, experts devised technology to maximize the flushing of sediment with low-level flaps and outlet gates. A second series of modifications added multiple facilities for fish migration. The modifications to further reduce impacts on the river have added about $100 million to the cost of the project but have comforted concerns of neighboring nations.
(BENEFITS) Q. What are the benefits for Laos? Firstly, the Xayaburi project will provide clean energy to about 1 million people in Laos, and secondly, electricity will be sold to Thailand to serve 3 million people there. Power purchase agreements, principally with the Electricity Generating Authority of Thailand (EGAT), will support poverty-reduction and infrastructure modernization programs. The economic impact of the Xayaburi hydropower plant will be in the range of US$450 million a year or nearly US$4 billion over the 29-year concession. Because the project is financed by the private sector, Laos will get power generation and infrastructure improvements without assuming any financial risk or debt. Direct benefits to the nation, derived from royalties, taxes and dividends, include new and improved roads, better living conditions and health access for people in the region, as well as employment opportunities and training for skilled labor, technicians and engineers. The Xayaburi hydropower project is the largest single investment in hydropower in Lao PDR, and will provide thousands of employment opportunities in one of the country’s least developed regions.
(FISH) Q. Will there be fewer fish in the Mekong River because of the Xayaburi project? No. There is no reason to believe there will be fewer fish. Fish and other aquatic species will be able to pass through the project area by a variety of means. The experience with other hydropower projects in Laos is that there will be more fish. Hand in hand with hydropower development over the past few decades, the supply of fish to the capital city Vientiane has actually increased to meet increased local demand. The Xayaburi project includes plans for a fish-hatching facility to ensure breeding stock of popular food fish and other species.
Q. What will be done to ensure fish migration? Several facilities will be built to minimize impacts on Mekong River fishery. Fish passage systems will ensure that fish of all sizes and species can swim across the width of the river in both upstream and downstream directions. A fish ladder extending 3 km will enable fish to swim upstream. The National University of Laos is designing fish ladders appropriate to the fish species in the region. A fish lift will carry fish through the dam to a higher elevation. Fish-friendly turbines will minimize losses due to machinery. A Fishery Extension Unit will breed aquaculture and native fish stock. During the initial phase of construction, fishery researchers will monitor fish migration to develop data on biology and ecology
Q. What is the difference between a fish ladder and a fish lift? A fish ladder is a permanent reinforced water course paralleling the river that is designed to gradually rise from a lower river level to a higher elevation, at an angle that will enable fish to swim upstream. A fish lift is a mechanical lift, or elevator, built into the mainstream barrage. Attraction currents at the top and bottom of the structure bring fish into a collection trough that is raised and lowered mechanically.
Q. Will Mekong River fish be able to swim upstream with fish ladders? Yes. Researchers at the National University of Laos have conducted fish ladder experiments on Mekong River fish species and shrimp. By adjusting the heights and angles of the troughs, to mimic the flow of water rushing downstream, they determined that Mekong fish and shrimp can easily swim upstream. After two years of research, they continue to experiment to learn more about fish behavior during upstream migration.
(BOATS) Q. How will big boats navigate the river? Throughout the ages, conditions on the Mekong River varied greatly from season to season, determining what boats could travel up and down the river and when. The Xayaburi project will greatly enhance the ability of vessels as large as 500 tons to navigate the river year round. This will have positive impacts on trade and tourism, contributing to the socio-economic well being of the region. The first navigation lock – actually a system of two locks – will be 12 m wide and 700 m long. Several vessels will be able to traverse the project at a time. The vessels will be lowered or raised over 35 m between an elevation of 275 m and 240 m. The overall design of the project allows for construction of a second navigation lock system if future traffic warrants expansion.
(INVESTMENT) Q. Why is the Xayaburi project called a public-private partnership? The Government of Laos has contracted with the private sector and professional experts to build and operate the Xayaburi Dam over a concession period of 30 years. The shareholders in Xayaburi Power Company Ltd., a Lao-registered company, include Ch Karnchang Public Co. Ltd., Natee Synergy Co. Ltd., Electricité du Laos, EGCO (Electricity Generating Public Co. Ltd.), Bangkok Expressway Public Co. Ltd., and PT Construction. The Power Purchase Agreement is with Electricité du Laos (EDL) and EGAT. Six Thai banking corporations have signed Credit Facility Agreements. Engineering Service Agreements are in place with Pöyry AF-Consult, Compagnie Nationale du Rhône, TEAM group and SEAN. The project is managed by a highly experienced Board of Directors with global expertise in economics, finance, law and technical aspects of hydropower development.
(TIMETABLE) Q. What is the timetable for construction? Preconstruction activity on preparatory infrastructure at the site began in 2010. Beginning in November 2012, the Construction Phase will take eight years. Roughly half of the time will be devoted to construction of right bank coffer dams, navigation locks, spillway and sediment flushing outlets and the intermediate block. The next phase involves construction of left bank coffer dams, the powerhouse and fish passage facilities. The installation and commissioning of electromechanical equipment will begin in 2018, culminating with the Commercial Operation Date in October 2019. The Operation Phase of the project covers 29 years through 2048 when ownership will be transferred to the Government of Laos free of charge.
(RESETTLEMENT) Q. How many people are being resettled? Under the approved Resettlement Action Plan about 458 families comprising about 2,200 people will be resettled at a cost of more than US$43 million during construction, and tens of millions more during operation. Following a public consultation process, the location and procedure for resettlement have been agreed upon, and development of housing, infrastructure and public facilities is underway. In keeping with best practices, the plan calls for both mitigation and compensation, by replacing lost assets and providing new living conditions and economic opportunities, including training and livelihood restoration programs to be carried out with continued support from the developer throughout the transition process.