Laos Hydroelectric Dam Projects Part I

Laos Boats in the Nam Khan

Laos wants to become the battery of Southeast Asia. The Laotian government is pursuing a number of hydropower projects with which the Southeast Asian country wants to strengthen its energy sector, generate more electricity and export it to neighboring countries. Alongside mining, hydropower is one of the most profitable sectors. The capacity to generate electricity is to be quadrupled by 2020. Despite the negative effects – also in neighboring countries, e.g. for fishing and rice cultivation in Cambodia – around 50 new dams are planned in addition to the almost 50 existing dams.

Not only negative ecological and social consequences – the breach of the dam in July 2018 revealed security gaps and made thousands homeless

In July 2018, an auxiliary wall of the Xe-Pian Xe-Namnoy dam in the south of the country, in the Attapeu province, broke. 30 people died, the unofficial numbers are higher, hundreds are missing and thousands have been left homeless.

The government promised to temporarily suspend new dam projects and to inspect existing dams. A special unit was set up to clarify how the disaster could have happened.

Critics speak of a long predictable and avoidable, man-made disaster, triggered by poor planning, construction and implementation.

According to areacodesexplorer, the Laotian government must now face the criticism that the construction of the dams is not designed for extreme weather conditions, there is no warning system for residents and communication was inadequate after the dam broke. Construction companies are also criticized.

Dams & dam plans for Laos

Nam Theun II Dam

In 2005, after ten years of negotiations with the Lao government, the World Bank promised a loan of US $ 1.3 billion for the construction of a dam on the Nam Theun River in the south of the country, whereupon international banks pledged a further US $ 1.6 billion.

The official opening of Nam Theun 2 took place at the end of 2010. Critics warned that the 450 square kilometer reservoir is destroying the ecosystem and livelihoods of the people in the region. In the meantime it has been shown that some of the fears have come true and that the dam project has not brought the hoped-for success. Even one of the advisory experts, Thayer Scudder, expresses doubts about the expectations associated with the construction of the dam, especially for poorer countries: “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 “. He justifies his doubts, among other things, with the results of a study “Should We Build More Large Dams? The Actual Costs of Hydropower Megaproject Development” (2014), which examined the costs of 245 large dam projects between 1934 and 2007 and concluded that the construction costs exceeded the expected profit.

First dam in the Mekong in operation since October 2019: Xayaburi Dam (Northern Laos)

At the end of October 2019, the first Mekong dam in Laos went into operation. Months beforehand – during the test phase of the turbines – residents reported downstream that water levels were too low, which is endangering the livelihoods of people living on the Mekong. Fishermen in particular suffer from low water levels and the associated decline in fish populations.

The project in the northwestern province of Xayaburi, around 150 kilometers south of Luang Prabang, has been causing heated controversy since construction began. The dam is valued at 3.8 billion US dollars and is expected to produce 1,206 MW of electricity annually, 95 percent of which will be sold to Thailand. The Xayaburi dam is the first on the lower Mekong and is considered the “greatest test” for the intergovernmental Mekong River Commission (MRC) since it was founded in 1995. In order for a dam project to be implemented, the decision-making process of the MRC provides for a consensus of all countries involved.

Laos Boats in the Nam Khan

Chronology of events

  • April 2011: Thailand, Vietnam and Cambodia vote for a postponement and a closer look at the effects of the dam. The decision is postponed.
  • December 2011: At the annual MRC ministerial meeting, the ministers of the four countries decide to postpone the project again. In this mutual coordination phase, they ask Japan and other international donor countries for financial support to carry out further studies and bring in national experts and interest groups.
  • The construction work will also continue during the coordination phase. Additional workers will be contracted to build roads and other equipment for the project. Opponents of the project speak of pure lip service from the Laotian government.
  • Mid-April 2012: The Thai company Ch.Karnchang, the second largest construction company in Thailand and one of the companies involved, informs the Thai stock exchange of the conclusion of a 52 billion baht (1.7 billion US dollar) contract with Xayaburi Power Co. Ltd, a Lao-Thai joint venture. According to the contract, construction is officially scheduled to start in mid-March 2013. Despite the possible negative ecological, social and economic consequences, Ch Karnchang is pushing for the contract to be signed and, despite protests from environmentalists and politicians, is of the opinion that the Laotian government has already approved the construction of the dam.
  • August 2012: Thai villagers file lawsuits against the dam.
  • Mid-September 2012: Even before the final decision on the part of the MRC, the Laotian energy minister promised to deliver electricity at an energy conference in Pnom Penh Cambodia. He says that construction should start at the end of 2012.
  • November 2012: Despite many protests, the Laotian government decides to start construction.
  • Environmental activists and politicians from the three lower Mekong countries, Thailand, Cambodia and Vietnam, demanded that the dam construction plans be postponed for a while or that they be given up entirely. Previous studies are neither compatible with international guidelines, nor do they provide a satisfactory answer to the questions raised.
  • The effects on the ecosystem are unsustainable based on the current planning. The planned dam could lead to a minus of six percent of the fish catch. Every year 2.5 tons of fish are fished from the Mekong. If the dam is built, over 200,000 people will feel the effects.
  • January 2013: At a meeting of the MRC, the representatives of the neighboring countries Cambodia and Vietnam “find their voice again” and demand a temporary construction freeze. In their Joint Development Partner Statement, the donors (including Germany, the EU, ADB, WB) affirm the hydropower potential in Laos, but at the same time demand transparent decision-making processes, the disclosure of the new dam design and greater involvement of civil society organizations.