A Blue–Ribbon Report That Made a Difference

Five years ago, on November 16, 2000, Nelson Mandela, the Prince of Orange, the President of the World Bank and other luminaries launched the report of the World Commission on Dams (WCD) at a glitzy ceremony in London. Initiated by the World Bank and the World Conservation Union, the report was the first independent evaluation of the performance of the world’s large dams.

The WCD found that large dams provide important water and power supply services, but that their social, environmental and economic costs are often unacceptable. The Commission estimated that large dams have displaced 40–80 million people, and that most of these people were impoverished in the process. The environmental and economic costs of large dams were often higher than predicted.

The WCD presented a series of far–reaching recommendations on how such impacts could be avoided in future. Key to better projects is first to assess all available options in a balanced, transparent and participatory manner. New projects should only go ahead if they find demonstrable public acceptance, and if the rights of affected people are guaranteed.

Large dams are one of the most contentious topics in international development policy. The WCD managed to find consensus through a process that brought conflicting interests – the dam industry, governments, academics, environmental groups and social movements – to the table. It was hailed as a new model of resolving international conflicts.

Unlike other blue–ribbon studies, the WCD report did not fade away after its launch. It still influences the decision–making of many different institutions. Governments (including those from Germany, Nepal, South Africa and Sweden) initiated national processes to translate the report's recommendations into policies. Numerous financial institutions committed to considering the WCD recommendations in their future water sector lending. Communities affected by large dams have started to insist on the new rights that the WCD proposed for them. In short, the WCD recommendations have become the most important global benchmark for the dam industry, and a kind of soft law against which all new projects are being measured.

The broad coalition that supports the WCD approach will bring about progress in the planning processes for water and power projects. Yet one critical actor is missing. After the dams commission dissolved, the World Bank walked away from the report that it had initiated, and announced that it would not follow its recommendations. Instead, the Bank embarked on a new strategy to build more dams, which completely disregarded the WCD’s findings.

The World Bank approved its first large dam project under the new strategy earlier this year – the Nam Theun 2 Project in Laos. It announced that it intends to support the immensely controversial Kalabagh Dam in Pakistan, even though its own research found that Pakistan’s existing dams have devastating environmental impacts, and are being utilized inefficiently. The World Bank is also considering support for high–risk dam projects in Brazil, Africa and other parts of the world.

Dam builders are looking at the Nam Theun 2 Project as the harbinger of a new trend, and are hoping that the Bank’s dam strategy will inject new lifeblood into their ailing industry. Yet Nam Theun 2 is considerably more expensive than alternative options of electricity supply, and is fraught with so many environmental risks and problems that it is ill–qualified to serve as a model. Since the World Bank announced its dam strategy in early 2003, new wind projects have added more power capacity to the global system than new large hydro projects.

The World Bank’s new dam strategy ignores 70 years of experience with corrupt decision–making, ruined rivers, impoverished communities, and unpayable debts. Only a people–centred approach will fulfil the water and energy needs of the poor without sacrificing affected communities and the environment. As numerous expert bodies have found, the alternatives to address these needs are available. The recommendations of the WCD offer the best way to select the most appropriate alternatives by creating a level playing field and involving all legitimate interest groups.

Environmental organizations stand ready to work with developers that are trying to follow the new model of the WCD. Governments that are committed to inclusive decision–making and to the UN’s Millennium Development Goals should bring the World Bank to reason. Governments, the World Bank and the dam industry should fully embrace the approach of the WCD, which offers the best chance to avoid the costly and painful mistakes of the past.