Environmental Criteria for Hydropower in the Mekong Region - WWF

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The Current Status of Environmental Criteria for Hydropower Development in the Mekong Region: A litterature compilation Table 4 Electricity Use and Socio-economic Indicators in the GMS Country Selected Socio-Economic Statistics Population (millions) Access Electricity GDP % of % Pop Use People Population Living ($US) with Urbanized on less Kwh/person Per Capita access to (%) than $1 annual electricity a day services Cambodia 14 391 89 15.0% 16.0% 33.8% Lao PDR 6 433 0 0.0% 21.6% 28.8% Thailand 65 2,767 1,808 82.0% 32.2% 17.8% Viet Nam. 83 621 492 70.0% 26.2% 9.7% Myanmar 55 ? 112 0.0% 30.0% n/a PRC (Yunnan) 43 - PRC(all) 1,300 1,769 1,467 0.0% 41.8% 33.0% Notes: 1 kwh is based on gross generation, not final demand 2 Data source is ADB for 2005 pop, ADB 2004 for rural % 3 GDP 2005 WB and ADB Country Profiles Perhaps the common ground is not an argument about if the role that electricity plays in the energy economy of the GMS will expand. 27 Rather, the debate should centre on how electricity is generated, at what scale, whether by centralized or distributed generation approaches, and whether sufficient attention is given to investments in efficiency of use, also recognizing this requires higher but socially responsible tariff policy. 28 Certainly the equity dimensions of service provision and tariffs (e.g. subsidy only between tariff categories) are central issues, within which commitments to meet the MDGs should be prioritized. 27 Electricity as a proportion of final end-use will continue to expand in the 21st century, as overall energy intensity levels and carbon use decline in post-industrial societies. Another contemporary view is that there are clear thresholds of electricity consumption, where basic needs have to be met. Presently all GMS countries adopt a policy to pursue electricity supply development, where demandside management investments will moderate growth rates. 28 This does not exclude a specific country context, where an aggressive demand side management programme in combination with targeted investments in technical efficiency in generation, transmission and distribution can defer new supply increments and contribute to regional energy security. 32
The Current Status of Environmental Criteria for Hydropower Development in the Mekong Region: A litterature compilation What environment criteria would be helpful in this area? First, the discussion highlights the need to find criteria (and policies) to integrate payments using power market mechanisms to improve the management of ecosystem services adversely transformed by hydropower projects. There is a clear rationale seen by the high proportion of the population living in rural areas (70%) and it reflects a central premise of electricity laws—to advance socio-economic development. Second, environment criteria need to assess how the benefits and costs of hydropower are distributed in society, in line with the MDGs and the governments’ own ethnic minority policies, looking at these through an ecosystems functionality and services lens. Most hydropower developments are in ethnic minority areas. An available tool is an environmental flows assessment (EFA) with social, environment and economic modules, the major variant being the Downstream Response to Imposed Flow Transformation (DRIFT) method developed in South Africa and promoted by the multilateral development banks and donors. 29 Box 1 Driving Factors Behind the Grid Supply Integration Reduced or postponed costs: through least-cost development of energy resources, reduced spinning reserve costs and sharing of ancillary benefits. Fewer projects are needed to serve the same demand where interconnection is feasible as compared to each country operating independently. Improved conditions on the supply-side. Reduced coincident peak load of the region, mutually utilized generation reserves for interconnected systems, increased robustness of power supply to meet unexpected events, increased system reliability. Export revenue earnings: net exporters such as Lao PDR and Yunnan see revenues to fund not only power investment and return on equity, but also an opportunity to capture economic rent to significantly increment national or provincial budgets. Domestic supply augmentation to meet immediate needs. Countries such as Viet Nam enter into long-term agreements with Yunnan and Lao PDR to cover load growth as lead times for new supply outstrip demand growth. Cambodia increases cross border supply in advance of developing its capacity. Greater Mekong Subregion Economic Cooperation power policy and strategy - Since 1992, the regional energy initiatives of the GMS have largely focused on the power sector, strengthening cross-border electricity trading and the interconnection of transmission networks. The power policy articulated in the GMS Forums essentially builds on the national policies, with the approach of regional cooperation within a framework of national initiatives. It recognizes that some GMS countries have more resources amenable for conventional grid generation than others, i.e. hydropower, 29 The DRIFT framework developed in South Africa addresses all aspects of the river ecosystem. It employs four modules to construct scenarios and their ecological, social and economic implications. An innovative feature is the strong socioeconomic module, which in the developing country context, can be used to predict impacts of each scenario on subsistence users of the resources of a river. (adapted from Flow: The Essentials, IUCN 2003). Also see World Bank Environmental Flow Assessment - NOTE C.1 Environmental Flows: Concepts and Methods, 2003 and Environmental Flow Assessment - NOTE C.2 Environmental Flows: Case Studies, 2003 http://web.worldbank.org/WBSITE/EXTERNAL/TOPICS/EXTWRM/0,,contentMDK:20436871~men uPK:1305255~pagePK:148956~piPK:216618~theSitePK:337240,00.html 33
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Environmental Criteria for Hydropower in the Mekong Region - WWF

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