Bujagali Dam and the WCD

Uganda is one of the world’s poorest countries. About 95% of the population does not have access to electricity, and most could not afford it even if they were offered free connections to the national grid. The US–based AES corporation, the world’s largest independent power producer, proposes to construct a US$530–million hydroelectric dam that would drown Bujagali Falls on the Nile River, a culturally significant site that also supports a growing whitewater tourism industry. The project is now being considered for funding from the IFC, the World Bank, the US agency OPIC, and a number of European export credit agencies.

In addition to the fact that this project will not help the poor majority, NGOs and civil society in Uganda have a number of other concerns about the project. The existing grid to which the dam will supply electricity is very inefficient and only a fraction of the nation’s population is connected to it. Allegations of corruption have dogged this project, which was not subject to competitive bidding and has enjoyed undue favoritism from both the Ugandan and US governments. The dam will be built within a few miles of two other dams, and the cumulative impacts on the river are unknown. The project is also expected to set off a dam–building boom in Uganda.

Bujagali is also a very risky project for Uganda. Under a "Take or pay" contract, Uganda has committed to buy a set amount of power every year regardless of how much is actually produced. As the project design and projected outputs are based on highly optimistic hydrological studies of the river, Uganda could end up paying for power that is not produced. Scientists believe East Africa could be hit with increasing and more serious droughts due to global climate change, thus increasing the project’s already significant "hydrological risk."

There are alternatives to this dam, but they have been minimized by project proponents. In addition to improving the existing system (it is estimated that 30 – 40% of electricity generated in Uganda is lost before it reaches the consumer), Uganda is favorably endowed for solar, microhydro, geothermal and, to a lesser extent, wind power. In neighboring Kenya, more households get their electricity from the sun than from the national grid, according to regional energy experts. A more decentralized approach to energy supply (lately called "micropower") would also be ideal for Uganda, as it would supplant the need for further expansion of the grid, has fewer impacts, and can be up and running more quickly—and in places where there is currently no power.

Evaluating Bujagali Against WCD Guidelines

NEEDS ASSESSMENT

WCD Recommendation
The WCD calls for a "needs assessment" to ensure that a project will actually meet local needs: "In countries where a large proportion of the population does not have access to basic services, a key parameter should be the extent to which basic human needs will be met."

Reality on the Ground
The Bujagali Dam will not bring power to the rural poor. The World Bank itself acknowledges that grid–based electricity generation will not meet basic human needs: "No more than 7% of the total population [in Uganda] can afford unsubsidized electricity… It is unrealistic to think that more than a fraction of the rural population could be reached by a conventional, extend–the–grid approach. A more promising course is to rely instead on ‘alternative’ approaches to electrification."

INCREASING EFFICIENCY

WCD Recommendation
The WCD calls for studies to assess the scope for "demand–side management (DSM) … and for decentralised supply options and community–level initiatives." It further states that "a priority should be to improve existing systems before building new supply, [and] that demand–side options should be given the same significance as supply options."

Reality on the Ground
Uganda has no thorough evaluation of DSM options, and no firm plans to try efficiency and conservation measures before building Bujagali Dam. If the World Bank chooses to support the project, it is likely to catalyze the construction of a cascade of dams on the Nile in Uganda, thus leading it away from the path of decentralized power supply options.

COMPREHENSIVE OPTIONS ASSESSMENT

WCD Recommendation
"Ensure that available alternatives, their relevant consequences and uncertainties are given full consideration." It urges that "a multi–criteria assessment was used to screen and select preferred options from the full range of identified alternatives."

Reality on the Ground
Although Uganda has excellent renewable energy potential, project proponents have dismissed these in favor of Bujagali. The evaluation of Uganda’s energy alternatives, commissioned by the IFC, was carried out by a dam engineering firm, Acres International, that is already building dams on the Nile. Not surprisingly, its report–which ran to hundreds of pages–had only a few paragraphs on solar. In public meetings conducted by Acres, solar and other options were barely discussed, because no information was presented on these options.

CUMULATIVE IMPACTS

WCD Recommendation
The WCD states, "cumulative impacts of projects should be analyzed," and "environmental impacts from past projects should be evaluated and incorporated into the needs assessment."

Reality on the Ground
The Bujagali Dam will be the third dam in one short stretch of the Nile. Neither of the two previous projects had environmental impact studies, and their impacts are not being evaluated in planning for Bujagali. A recent article in the Ugandan newspaper New Vision states, "Doctor John Baliwa of the Fisheries Research Programme told stakeholders during a workshop … that mats of water hyacinth could accumulate behind the numerous dams and kill fish in the area. He said many [dams] had been planned along the Victoria Nile, which is an extensive fishery resource with an estimated potential of 10,000 metric tons of fish per year." Other cumulative impacts include dessication of wetlands and forests along the river.

RISK

WCD Recommendation
Risk must be fairly analyzed and publicly discussed. "[Risks] must be identified, articulated and addressed explicitly. Most important, involuntary risk bearers must be provided with the legal right to engage with risk takers in a transparent process to ensure that risks and benefits are negotiated on a more equitable basis." It goes on, "Determining what is an acceptable level of risk should be undertaken through a collective political process."

Reality on the Ground
This project has big risks for Uganda’s taxpayers, and yet public discourse on the terms of the government’s agreement with AES has been minimal. The key document that lays out risks – the power purchase agreement – has been kept secret. However, the terms of the power purchase agreement reportedly force Uganda to buy all of the project’s projected power output even if there is not enough demand from consumers, and even if the dam is unable to generate the power due to drought.

There is also significant risk to dam–affected people to whom promises have been made by AES that may not be kept. There are no mechanisms in place to hold developers accountable to their promises, which in this case have been substantial (jobs, hospitals, schools and land are just some of the promises). At this writing, potentially affected people had begun demonstrating at AES’ project–site offices, to demand an end to their uncertainty. According to the local newspaper The Monitor, "…It is now four years without cultivation and famine was biting the locals. ‘People have one meal a day and eat food bought from shops,’ the enraged locals said.".