Critical Assessment on the Mekong Region’s Power Development at Risk of Being Shelved

Tanya Lee

In December 2013, a study commissioned by the Asian Development Bank (ADB) on “Ensuring Sustainability of the GMS Regional Power Development” was completed by the International Centre for Environment Management and Economic Consulting Associates. The study used a strategic environmental assessment (SEA) approach to assess alternative energy futures for countries in the Greater Mekong Subregion (GMS) and identify costs and benefits of alternative energy scenarios. However, rather than disclosing the report and making it publicly available online, the ADB posted a memo on their website stating that the text was undergoing a process of being “edited and refined further” based on comments provided by GMS government representatives and other unidentified reviewers. 

The content and conclusions of the study are evidently being met with resistance on the part of governments in the region. For example, when the report was discussed during a “Regional Power Trade Coordination” meeting that was facilitated by the ADB in December 2013, questions were evidently raised about why large hydropower did not feature in the renewable energy scenarios described in the study, and why ‘positive’ impacts of energy projects, including large hydropower dams, did not receive the same weight as ‘negative’ impacts. It remains to be seen how such concerns will be integrated into the ADB’s revised version of the report, and how willing governments will be to put the recommendations into practice.

According to the ADB, the final study was to be made available by mid-October 2014. At the time of writing, the ADB has yet to disclose any study on their website. In the meantime, International Rivers has obtained a copy of the draft study. 

Comparing Energy Scenarios

The GMS report evaluates models of the current national power development plans (PDPs) of Cambodia, Laos, Thailand and Vietnam, in comparison to two alternative scenarios – a renewable energy and an energy efficiency power plan trajectory. It identifies significant problems with current PDPs in place. For example, the Lao and Cambodian PDPs include a number of hydropower projects identified as generating energy for export that are not matched by corresponding import projects in the PDPs for Thailand and Vietnam. It also notes that national projections of capacity needed and demand growth appear to be unrealistically high, leading to an overestimation of the number and scale of power projects needed. Accordingly, projections for the alternative scenarios demonstrate that installed capacity and energy power plants could be displaced if different factors are prioritized. For example, the study suggests that if an emphasis were to be placed on developing renewable energy or on energy efficiency, several planned nuclear plants and large-scale hydropower projects would not have to be built and could therefore be scrapped from current PDPs. 

The report concludes that in general, power sector planning processes do not adequately take into account national or cross-border environmental and social impacts, rational estimations of demands, or a cost-benefit analysis of alternative options. Importantly, the authors demonstrate that when using an evaluation scheme based on multiple security factors, energy efficiency scenarios consistently outperform the renewable energy and current PDP scenarios, because of the lower demand for electricity and lower requirement for the levels of installed capacity. 

Seemingly simple steps have been recommended by the report’s authors to improve power planning processes, including:

  • the integration of environmental and social concerns as well as costs, 
  • the development of agreed upon common approaches across the region, and 
  • the improvement of the quality of public consultations. 

Yet, the shortage of political will and political space mean many hurdles exist for such suggestions to become reality. 

Pursuing a Politically Safe Route At the Expense of Millions of Peoples’ Livelihoods?

Notably, some hydropower dams categorized by the study’s authors as ones that could be displaced if governments put more emphasis on renewable energy or energy efficiency have moved forward since December 2013. For example, Nam Ngiep 1 in Laos received a US $147 million loan from the ADB (approved in August 2014), but was highlighted as one of the dams in Laos that would not have to be built if there was the political will to explore alternatives. 

The fact that the ADB is prepared to ignore research it commissioned, and is unwilling to take any leadership to promote the alternative energy scenarios outlined in the report, raises serious questions about whether the study itself will have any practical influence on the situation at hand. Allowing the report to essentially be shelved would be politically ‘safe’ for the ADB, but would come with an immeasurable cost: the lifeblood of millions of people in the GMS who rely on the health of riparian and forest ecosystems for their very survival.