This content is from: Local Insights

Hydropower developments on the Mekong

The Lower Mekong River basin is attracting increasing interest on the part of developers of mainstream hydropower projects.

Private sector developers are studying 12 hydropower projects for the mainstream. The Mekong River is one of the last large rivers on earth not dammed for most of its length. It runs through six countries: China, Myanmar, Lao PDR, Thailand, Cambodia and Vietnam. China has built four mainstream dams. There are proposals for 12 hydropower projects in the works for the Lower Mekong River.

A number of hydropower projects have been built on tributaries in Lao PDR. The latest to achieve COD (in March 2010) is the Nam Theun 2 project, which was financed by 27 financial institutions including the World Bank.

The Mekong River Commission (MRC) is the inter-governmental river basin organisation, formed to implement the 1995 Mekong Agreement to which the governments of Cambodia, Lao PDR, Thailand and Vietnam are parties. They agreed on joint management of their shared water resources. They adopted a protocol that obliges them to notify their neighbours of proposed mainstream projects, and to consult and reach agreement on whether or not to proceed. The procedure was triggered for the first time, on September 22 2010, by Lao PDR's proposal of the Xayaburi mainstream project. The project developer is a Thai construction company and the power would be sold to EGAT; Thai banks would provide project financing.

On October 15 2010 the Strategic Environmental Assessment of Hydropower on the Mekong Mainstream issued its final report. Details can be found on the MRC website:

The main recommendation was that decisions on mainstream dams should be deferred for a period of 10 years, with reviews every three years to ensure that essential deferment-period activities are being conducted effectively.

The recommendation arises from the recognition of a need for caution in the face of evident threats of serious and irreversible environmental, social and economic damage. The report was prepared by a team of consultants, and does not necessarily represent the MRC's views. However, it may give rise to concerns on the part of lenders to proposed mainstream projects, and result in the approvals from the MRC and lenders, that are necessary to implement the projects, being delayed.

Albert T Chandler

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