Effects on Biodiversity
Development, by its very nature, results in change. This change also affects the environment. This occurs in the construction of dams, powerhouses, and transmission lines, generating plant and in the case of a hydro scheme with stored capacity, inundation of the reservoir area. The effects on the environment are both positive and negative.
Negative impacts include:
- changes to the habitat of animals and fish
- loss of vegetation
- changes in food available for wild life
Negative impacts are inevitable and it is thus vital to manage and mitigate the negative impactsand to monitor the mitigation programme. It is also important to ensure that the negative impacts of energy development are outweighed by the economic benefits of development
Relocation of people
Where it is necessary to relocate people, it is important to ensure the relocation is done so that the lives of those resettled are improved, with this improvement objectively measured.
There are World Bank Standards (Directive 3.20) which set down guidelines and future hydropower projects in Lao PDR will be guided by World Bank criteria.
EIA Reports
There are well established standards for Environmental Impact Analysis, Resettlement, and Environmental Impact Mitigation. If these standards are not applied effectively two problems emerge:
- there is a deterioration in the quality of the environment
- criticism of the energy project leading to delays
Delays to projects due to Environmental issues result in financial losses which not only effect the viability of the project, but ultimately reduce the financial returns to Lao PDR for poverty alleviation and the development of the country
Hongsa Thermal Project
The Hongsa Power development will burn lignite coal that includes significant sulphur in its composition. It will be necessary to design the plant so that these sulphur emissions are minimised.
Thermal generation has lower efficiencies (33 - 40%) than hydropower and is associated with pollution of the atmosphere, global warming and acid rain formation. Acid rain from thermal generation is a growing regional problem in South East Asia. Global warming from the atmospheric build-up of C02 released from high carbon fossil fuels is also an increasing concern. With energy growth within the region projected to double every seven years, the consequences of relying exclusively on thermal power for energy generation will have major regional and global consequences
Databases
Energy developments are often criticised for their effect on water quality, fisheries and agriculture. In Laos these criticisms are usually hearsay and are not based on scientific data that meets an international standard. This often results in subjective and anecdotal debate that does not assist in developing proper management plans.
It would assist greatly if reliable databases on water quality and fisheries for each project were available so that objective analysis of the effects of each project could be undertaken. This would hopefully reduce the time taken to resolve these issues
Delays in Resolving Environmental Issues
Given the costs of developing a project, delays related to resolving environmental issues can effect the viability of a project. These delays result in more front-end capital being required to develop a project and a higher profit component in the cash flow analysis to cover any extra costs incurred in resolving environmental issues that are prolonged. Front-end capital is expensive because the interest payments accumulate over a potentially long period of time before cash flow is generated to repay any borrowings.
It would improve the viability of projects if a streamlined process for resolving the environmental issues associated with energy projects was created that is acceptable to all interested parties
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