Special Reports
Malaysia's Bakun project: Build and be damned
by Tony Allison
Summary
Despite a long history of controversy and difficulties, both financial and political, Malaysia is proceeding with the Bakun Hydroelectric Project (HEP) in Eastern Sarawak, although most likely on a smaller scale than originally planned.
The project, originally estimated at US$5.2 billion, was to construct what would have been the world's second-largest dam. Work was suspended at the height of the Asian economic crisis in 1997.
Unofficial estimates say that if the project is revived in full, it would cost a third more than its original price tag. Funding would have to come from state coffers as the government has assumed control of what was once a private turnkey project.
Bakun Dam was to supply 2,400 megawatts (MW) of electricity - generated from a reservoir the size of Singapore - to East Malaysia and the peninsula via undersea cables, although the latter proposal is most likely to be scrapped.
Prime Minister Mahathir Mohamad said on October 23 the project would be revived as money spent on pre-construction works should not be wasted. "We will revive it, whether full-scale or not we have not decided yet,'' he said. He added the dam was needed to meet the growing demand for electricity in Malaysia. However, most of the growth in demand for electricity is not in Sabah and Sarawak in East Malaysia where the dam is located, but in the peninsular.
Environmentalists and social activists have roundly and vigorously opposed the project, saying it will destroy a vast tract of rain forest and force more than 10,000 villagers from their homes. Many thousands have already been resettled.
The Bakun HEP was taken over by the government in 1997 and subsequently suspended by then Deputy Prime Minister and Finance Minister Anwar Ibrahim, much to the ire of Mahathir. Differences over the project are believed to have contributed to the later sacking of Anwar. Earlier, the leaders of an international consortium managing the project, ABB, had been dumped from the project in acrimonious circumstances.
Last June Mahathir said Malaysia must proceed with construction because of rising industrial demand for electricity, and work on diversion tunnels for the river was resumed. The project is now managed by the national utility company, Tenaga Nasional Berhad.
Work on the 12-meter high, 1.4-kilometer long tunnels, being undertaken by South Korea's Dong Ah Construction Ind Co Ltd, is expected to be completed in early 2001. On the current schedule the dam will be able to generate 500 MW of electricity by 2005.
The project
In its original form the HEP comprised the construction of a 2,400 MW hydroelectric dam, the transmission of its electricity, and the building of related infrastructure including access roads, a new township and an airport. The dam would bridge the Balui river, about 37 km upstream of Belaga in Sarawak. Sarawak is one of the two East Malaysian States in the northern part of the island of Borneo. The transmission of its electricity would have necessitated some 1,500 km of overland wires and four 650-km-long undersea cables under the South China Sea to Peninsula Malaysia.
The dam is to be a 205-meter-high Concrete Face Rockfill Dam (CFRD), with a length of crest of 740 meters, a base width of 560 meters and a crest width of 12 meters. This makes it one of the highest rockfill dams in the world. It will flood 69,640 hectares of land, an area bigger than Singapore. Its catchment area is over 1.5 million hectares of mainly primary forest, even though some 16 percent of Sarawak's total log production currently comes out of this area. Fifty-one percent of the land of the reservoir area is Native Customary Land (meaning it is legally owned by indigenous communities).
The project requires the relocation of up to 10,000 indigenous people, mainly of the Kayan, Kenyah, Kajang, Ukit and Penan ethnic groups. In addition, by changing water quality and river flow patterns, it would potentially affect the thousands of people living downstream of the dam, on the Rajang river, which is the longest river in Malaysia. The completion date was to have been 2003.
Malaysia's power needs
Malaysia's energy policy has traditionally been based on a four-fuel strategy - gas, oil, hydroelectric and coal. Of these, gas is dominant, with about 70 percent of the country's requirements supplied by gas-fired power plants.
However, the government will adopt a "five-fuel" policy in the Eighth Malaysia Plan (2001-2005) by placing stress on "renewable energy" as an alternative source. The move is prompted by too much reliance on gas and the pollution caused by other options. Promising areas for renewable energy include the conversion of biomass waste to energy, and in solar-power applications. Given this initiative, the opponents of Bakun will further question the need for it.
A country typically experiences growth in electricity demand at approximately 1.5 times the rate of its economic growth. Malaysia is currently in the second year of a strong recovery from the effects of the Asian financial crisis of 1997-98. Following a 7.5 percent decline in real gross domestic product in 1998, Malaysia experienced real GDP growth of 5.4 percent in 1999. Real GDP growth for 2000 is projected at 5.8 percent. Oil and gas production accounts for more than 8 percent of Malaysia's total GDP.
Malaysia currently has approximately 14,000 MW of electric generation capacity. In 1998, the country generated about 57.4 billion kilowatthours of electricity. In addition, four power projects are scheduled to be commissioned after 2000: Yan Power Plant (1,200 MW), Lumut Power Plant (2,100 MW), Perlis Power Plant (650 MW), and Kulim Power Plant (450 MW).
Bakun had been slated to send 70 percent of its generated power (officially stated as an average output of 1,770 MW) from Sarawak to Kuala Lumpur through the construction of 664 km of overhead lines in eastern Malaysia, 640 km of submarine cables and 456 km of distribution infrastructure in Peninsular Malaysia. In addition, expansion plans included a high-voltage line south to Johor Baharu and north to Perlis, near the western Thai border.
The development of the Bakun HEP was aimed to create a more balanced generation mix, with hydro sources accounting for 19.7 percent by the year 2005. The project is touted as one of the most hydrologically efficient base-load plants in the world, with a ratio of firm energy to average energy of 92.5 percent.
Malaysia is reforming its power sector to make it more competitive and to lower costs. Currently, three state-owned utilities dominate power generation and distribution. The market was opened to independent power producers (IPPs) in 1994, and 15 IPPs were licensed. Tenaga Nasional Berhad, the manager of the HEP, began in 1999 to divest some of its generation units.
Opposition
The Bakun HEP has been mired in controversy since it was first proposed in the early 1980s. Apart from the question of its necessity, its financial viability and its environmental costs, questions have been raised from the beginning about its potentially disastrous social impacts as it would flood an area the size of Singapore and some 15 indigenous communities involving more than 1,500 families and nearly 10,000 people would have to be resettled.
The project is opposed by many in the indigenous communities of Malaysia, together with the opposition Democratic Action Party (DAP) political party, the Coalition of Concerned NGOs on Bakun (Gabungan) - a coalition of over 40 Malaysian NGOs, including the World Wildlife Fund For Nature (WWF) Malaysia and the Environmental Protection Society of Malaysia (EPSM) - and many other NGOs and individuals around the world. Some of the key criticisms include:
Bakun's electricity would be neither the cheapest nor the cleanest available in the country.
The siting of a dam designed to supply Peninsular Malaysia with electricity in a remote part of Sarawak is highly dubious. Among other things, it means the project would rely on the transmission of electricity via long overland and undersea cables whose security and viability may be vulnerable, and whose environmental impact is incalculable.
There was the perception that the official projections of Bakun's electricity output were wildly optimistic. The project was based on a number of assumptions regarding, for example, efficiency of the dam, rainfall, streamflow, sedimentation rates, likelihood of earthquakes, maintenance costs, speed of construction, and downstream effects; the miscalculation of any one of which would throw the viability of the project into doubt.
The planning of the dam was conducted with no public accessibility to vital feasibility studies, no process of public feedback on the Environmental Impact Assessment (EIA) process and limited consultation procedures with the indigenous peoples. Feasibility studies and reports commissioned by the government on the Bakun project have been classified under the Official Secrets Act, meaning it is a criminal offense for anyone to see or use their information. Not all of the appendices, interim and final reports of the EIAs have been made accessible to the general public. Project proponents have refused to meet critics in any open discussion.
Adverse environmental and social impacts as well as the risk to the safety and livelihood of the people living downstream due to possible sudden releases from the reservoir and the potential of a dam failure are feared.
The design does not adequately address the dangers of overtopping, sedimentation and reservoir-induced seismicity.
Malaysian Prime Minister Mahathir Mohamad has steadfastly defended the project, saying it was the "government's way of helping the poor". He has also attacked critics of the project as unpatriotic and irresponsible, and has blamed "foreign" hands for stirring unrest.
EIA reports: The project promoter was required under the Environmental Quality Act 1974 and the Natural Resources and Environment (Amendment) Ordinance, 1993 of Sarawak, to submit EIA reports, detailing the possible impacts and the mitigating measures. The Natural Resources and Environment Board (NREB), Sarawak and the Department of Environment, Ministry of Science, Technology and Environment were the responsible authorities for approving the EIA reports and in ensuring that the project promoter complied with any mitigation measures as stipulated in the EIA reports.
The publication of the EIA did little to reassure critics. Not only did it specifically exclude assessment of the impact on the communities, but the assessment of the project generally was full of omissions, mistakes and questionable assumptions. In issuing the EIA report, the government ensured that it could be inspected only in Kuching, the state capital of Sarawak, and two small towns in the vicinity of the proposed dam, shutting out those campaigning against it from having access to the report, which was also made available in these three centers at an exorbitant cost and only in English.
At one stage the Malaysian High Court even declared the project invalid. It ruled that the decision to implement the project had not been reached through any form of public participation. The government's reaction was to dismiss the decision as "technical".
The High Court found that the government had subverted the basic rights of the indigenous peoples to comment on the EIA before approval. The issue was brought to the court by three members of a native tribe who would have been the direct victims of the project. The ruling was later dismissed on appeal.
History of the project
Studies relating to the hydropower potential of the Rejang River Basin, in which Bakun is situated, began in the 1960s. The Bakun HEP, which was to be a part of a series of dams, was subject to several dozen separate studies covering technical, economic and environmental aspects. The government began serious discussion on the project in the late 1980s, but decided against it in 1990, for the following reasons:
Recession and slow economic growth in the mid 1980s dampened the government's optimism on the growth of electricity demand;
The availability of gas for electricity generation caused the project to lose its status as the least-cost option for Peninsula Malaysia until the year 2000.
A review of the project undertaken in 1992 concluded that the project was economically viable and should be implemented, for full commissioning by 2005. Based on this review, the government agreed in September 1993 that the project be started.
Prime Minister Mahathir said at the time: "Bakun will not only provide the cheapest source of energy but will also serve as a catalyst to the country's industrialization program." This included being able to supply energy to fuel an aluminum smelter in Bintulu. Other official reasons given at the time for its revival were:
To generate employment and valuable spin-off industries for Sarawak, which were expected to add 3.0 percent to that state's growth per year;
To bring the indigenous peoples "into the mainstream of development" through resettlement;
To provide much needed infrastructure to a remote part of Sarawak, which will become a valuable tourist destination.
A public-listed company, Ekran Berhad, submitted a conceptual proposal to the government to implement the project on a privatized turnkey and fast-track basis for commissioning by 2003. Ekran's chairman, Ting Pek Khiing, was known to be close to Prime Minister Mahathir Mohamad and other leading politicians. Subsequently, the government issued an invitation to Ekran Berhad to submit a detailed project proposal.
This was reviewed with the assistance of international consulting firm, Harza Engineering LP of the United States. Subsequently, a letter of intent was issued to Ekran Berhad to undertake preliminary works to implement the project, including the preparation of tender documents, prequalification of contractors, invitation to bid and submission of EIA reports.
In view of the huge capital outlay involved, the government decided the project be undertaken by a joint-venture company. The State Government of Sarawak, Tenaga Nasional Berhad (TNB), Sarawak Electricity Supply Corporation (Sesco), Malaysia Mining Corporation Bhd (MMC) and others were invited to participate in the venture, to be led by Ekran Berhad. Its responsibilities included the sub-contracting of all necessary works related to the project, and the raising of the finance. The Sarawak State government, however, was responsible for the resettlement of the affected indigenous communities.
In order to meet the commissioning target of 2003, the government allowed Ekran Berhad to proceed with the preparatory works. The government requested Ekran Berhad to begin work on the 12-metre high, 1.4-km-long river diversion tunnels first, since they were a critical component of the project.
For the main works, Ekran Berhad invited bids based on a tender document which was prepared by the company and reviewed by the government. The bidders were required to submit tenders on a lump sum design-build basis. For this bidding exercise, the project was divided into two packages - hydro and transmission. Bidders were allowed to submit tenders for either separate individual packages or combined packages.
On June 13, 1996 the Malaysian government announced the awarding of the tender to an international consortium led by ABB, an international electrical engineering company which was the result of a merger between the European engineering giants Asea of Sweden and Brown Boveri of Switzerland. ABB was to construct the hydro-electric power generation plant and transmission system at Bakun. With its value of more than $5.5 billion, it was the largest single project ever handled by ABB.
As consortium leader, ABB was responsible for the overall project management and supply of all electrical equipment, including six 420-megawatt hydro-generators and a complete 500-kilovolt High-Voltage Direct Current (HVDC) transmission system to connect the power plant in Sarawak to the centers of population in Peninsular Malaysia - a total distance of more than 1,300 km, of which half will be via three submarine cables under the South China Sea.
ABB's consortium partner for the civil works was Companhia Brasileira de Projetos e Obras (CBPO) of Brazil, a large civil engineering company belonging to the Odebrecht Group and which was to be responsible for the construction of the dam and power house. In addition, substantial work was to be carried out by Malaysian companies and other groups from Asia, Latin America and Europe. ABB agreed to follow the Malaysian government policy of transferring and sharing technology. Engineering consultants from Germany (Lahmeyer) and the United States (Harza) helped with feasibility studies, dam design and overall project supervision.
By 1997 the project faced major difficulties. Financing was proving to be a problem, with reports of lack of payments and uncertain deadlines, and Malaysian government agencies were forced to take up large share-holdings, meaning taxpayers' money was being used. Conditions at the dam site were said to be bad, and although never officially confirmed, there were said to have been a number of fatal accidents. Delays caused by problems with the diversion tunnels had already indicated the unjustified optimism of original schedules, and the schedule for the resettlement of the indigenous people was repeatedly delayed.
In 1997, the contract with ABB was withdrawn after an bitter row with the project developers, Ekran Berhad, mainly over the issue of time/cost estimates and who was to be responsible for any extra payments in the event of overruns, and on Ekran's insistence on using subcontractors linked to it without going through the tendering process. Subsequently, the project was suspended, due in part to the economic crisis in Southeast Asia and to investor fears over its high financial risks.
The immediate impact of the loss of the construction contract was a write-off of $100 million in ABB's third-quarter results. In terms of market share, ABB slipped from first to third place in the hydro generator market for the world's largest projects, behind its rivals, General Electric and Siemens.
By December 1997, with the project stalled, then Deputy Prime Minister and Finance Minister Anwar Ibrahim announced its indefinite suspension, along with all other major infrastructure projects in the country. It was unusual for Anwar and not Mahathir to make this decision. Some analysts suspect that Anwar wanted to preempt measures that might be taken by the recently formed National Economic Action Council, formed to tackle problems flowing from the Asian economic crisis. There was concerns that well-connected businessmen in Malaysia would be appointed to the council and that they would take steps to protect their interests at the expense of national interest.
Political fallout: The HEP is believed to have been one of the factors causing the fallout between Prime Minister Mahathir and Anwar, his anointed successor. During the country's general election in November 1999, Sarawak Chief Minister Tan Sri Abdul Taib Mahmud accused Anwar of sabotaging Bakun and other large development projects in Sarawak. Taib said that in front of the prime minister Anwar supported all development projects in Sarawak, but that behind his back he criticized and cancelled these projects.
In early November 1999, Anwar testified in the High Court - where he was being charged with sodomy - that he had clashed with Mahathir when he disagreed with the prime minister's directive to him to use treasury funds to compensate Ekran without proper audit and procedures as it was not the duty of the finance minister to "plunder" public funds to save any company. Anwar said the prime minister was angry with him over the matter and this led to "bad blood" between them, culminating in his dismissal on September 2, 1998.
Revival
In mid-1999 work resumed on the river diversion tunnels, a major component of the project, which are due be completed by early 2001. The Malaysian government has taken control of the project, under the management of national utility company, Tenaga Nasional Berhad. To date, financial compensation totaling more than $250 million is believed to have been paid to Bakun Hydroelectric Corp, Ekran and other parties. It is estimated that 9,000 people have already been relocated, where they face high costs of living and social problems.
In November 1999 the Tenaga Nasional Berhad and Sarawak Electricity Supply Corporation (Sesco) were asked to review the scope and scale of the revived project. It is believed that the subsea transmission line concept has been abandoned, and the government is exploring the possibility of sales of electricity to Brunei and Indonesia. It is likely the project will be scaled down from its original 2,400 MW capacity, but to what extent is still unclear.
Critics say that both Sarawak and Sabah, where the power will have to be sold should the undersea option be canned, already have enough electricity and they are certain to remount their sustained campaign to have the project scrapped.
(Special to Asia Times Online)
Economic Aspects of the Project - 1) Financial returns on, and economic viability of the project.
- 2) "The Bakun Dam within the development of the Malaysian economy"
- 3) Close ties between project proponents, contractors, and government officials
- 4) The effort devoted to finding private or domestic sources of funding, and to portray this project as an example of privatization.
- 5) The international economic links implied by this project.
- 6) Doubts as to the need for power from Bakun
Impacts of the Project
- Environmental Impacts
- Social Impacts: Resettlement
- Technical issues
Economic Aspects of the Project (top of page)
1) Financial returns on, and economic viability of the project.
Since the project was first proposed, its proponents have projected favourable economic returns. In 1983 the SAMA Consortium projected rates of return of about 16%. They also noted that only if there was a "practically inconceivable combination" of low demand for electricity, low fuel prices, and "extreme deviations from expected costs (+20%) and benefits (-20%) would the project become marginal. This study concluded that "Bakun is an economically outstanding project."
However, the experience with most large water projects has been that costs have been underestimated, and benefits have been over-estimated. This appears to also be the case with the Bakun project. Power from the project is likely to be more expensive than that available from other sources. Ekran has signed a contract to sell electricity to the national utility at a rate higher than that offered to independent power producers, and about double the cost of power from the utility's own stations. Even at this rate, much doubt has been expressed that the project will be economically viable. Ultimately, according to many critics, the cost of the project will be borne by the national electric utility, and by the Malaysian public, through higher electricity rates, direct subsidies, or both.
Sources:
o SESC 1983.
o Insan, Power Play, pp. 19-52. [Detailed discussion of economic aspects of the Bakun Project.]
o Delphi International, "Bakun: High Dam: High Risk?" 8th July 1996. [Assessment of the economic viability of the project, from the perspective of London-based investment consultants. Highly influential.]
2) "The Bakun Dam within the development of the Malaysian economy" (top of page)
Beyond the economic viability of the project itself, the Bakun Dam has been justified in terms of the overall economic development Malaysia. In 1991 Malaysia established "Vision 2020", a plan that envisages Malaysia becoming a fully developed, industrialized nation by 2020. Key aspects of the plan include:
- a central role in the development process to be played by manufacturing, as the nation shifts from its former reliance on primary resources and agriculture;
- access by Malaysia to the most advanced technology, through both domestic innovation and links with foreign technology-based companies;
- a partnership between the government and the private
sector, with shared goals, and close working
relationships.
Within this context, the Bakun Dam could contribute in several ways to Vision 2020:
- through the supply of electricity, needed by manufacturing. In recent years, demand for power has increased by up to 13 per cent / year. The 2400 megawatts produced by the dam was expected to be required by soon after the year 2000;
- through gaining access to advanced power technology, such as turbines and transmission lines, provided by foreign engineering firms;
- the project would be a model of close partnership between the state and federal governments, and the private sector.
3) Close ties between project proponents, contractors, and government officials (top of page)
As is often the case in Sarawak natural resources development, there are close ties between government officials and proponents of resource development. (For example, the Sarawak environment minister also holds major timber concessions.) In the case of the Bakun project, two of the Sarawak Chief Ministers' children are shareholders of the company participating in harvesting timber from the forest reservoir area. The Sarawak Chief Minister is also chair of the Sarawak Natural Resources Board, established by the Sarawak government to regulate the project, and over-ride the national environmental impact assessment provisions. Tight links between business and government officials often means that these officials are in a position to benefit when companies with which they are associated receive benefits.An extensive array of often closely-associated businesses are potentially or actually involved in the Bakun project. In many cases, these businesses have associations of
various kinds with Ekran Berhad. Ekran has sought to provide lucrative contracts for components of the project (harvesting timber, or selling products to the project, etc.) to associated companies. (In mid-May 1997, however, ABB overturned many of these contracts, opening them up to other companies through a more competitive bidding process.)
Sources:
o "Jupiter's list of potential players," The Edge, Oct. 14, 1996
o "The Bakun Connection: The Business Connections and Environmental Effects," Aliran Monthly, Vol. 15(7), 1995. [On the complex business relationships of Ekran Berhad.
(top of page)
4) The effort devoted to finding private or domestic sources of funding, and to portray this project as an example of privatization.
In the project's first incarnation in the 1980s, funding was not discussed in any detail publicly. The widespread assumption apparently was that Malaysia would seek loans from international sources, particularly multilateral development banks such as the World Bank. However, in the 1990s, there is clearly a strong intention to avoid funding from multilateral sources. This is likely an effort to avoid the controversies and close
examination that have arisen from World Bank funding of dam projects elsewhere, such as the Narmada project in India. A statement by Prime Minister Mahathir on September 24, 1991 perhaps helps explain his government's effort to avoid involvement of the World Bank: "We in the poor countries would like to have some cheap hydroelectric power. But
all manner of campaigns are mounted against our proposals the World Bank will be used to deprive poor countries of cheap hydroelectric power. And all this after the rich have developed most of their hydro potentials." Instead, funding is being sought through domestic private and government sources, as well as international private investors.
The extent to which the Bakun Dam represents "privatization" of power generation is ambiguous: while Ekran Berhad currently holds the largest stake in the project and is actively seeking private investment, the Sarawak state government and Sesco are also major shareholders. Ekran has also agreed to sell much of the power to the national public utility,
at rates that may involve considerable subsidy of the project by Malaysian electricity consumers. Indirect government support of the Bakun project, through the involvement of the Employees Provident Fund [state-run pension fund] in underwriting it, has aroused controversy, because of the potential risk to workers' savings being invested in this project, with uncertain returns.
While domestic sources are envisaged as the dominant sources of funding, funding from foreign private sources is also clearly a priority for project proponents, perhaps because of the credibility such funding would provide. However, the effort devoted to obtaining private funding illustrates the obstacles encountered in financing such a project without subsidies. It has often been argued by dam opponents that such projects could not survive without large subsidies from governments or multilateral development banks. Difficulties that Ekran has encountered in soliciting interest from foreign private investors suggests that this is also the case in this project.
Sources:
o Delphi International, "Bakun: High Dam: High Risk?" 8th July 1996.
(top of page)
5) The international economic links implied by this project.
The Bakun project has attracted the attention of numerous international engineering and construction companies, with experience building dams elsewhere. A consortium led by ABB Asea Brown Boveri and Brazil's CBPO had won the bidding to build the dam. Other major participants in the consortium include Hyundai Engineering and Construction and Mexico's Ingenieros Civiles Asciados S.A. de C.V. Other companies will also be involved. Both ABB and CBPO have been involved in building many other dams, including some that have aroused substantial controversy. These and a few other major firms together dominate the $20 billion/year international dam building business, engaging in active lobbying to support dam projects.
6) Doubts as to the need for power from Bakun (top of page)
Since 1993 Malaysia's generating capacity has expanded greatly, with new plants being constructed by the national utility and by independent producers encouraged by policies promoting privatization of power generation. The margin of supply over demand has increased to about 50 percent, with several additional plants expected to be completed within the next few years. As a result, the need for power from Bakun has become much less evident.
Impacts of the Project (top of page)
As it had in the 1980s, the Bakun project has elicited a variety of concerns, relating both to its impacts, and the process by which decisions are being made. These concerns have led to formation of a popular movement, the "Coalition of Concerned NGOs Against the Bakun Dam". Since late 1993 their concerns have coalesced around environmental
impacts, social impacts (resettlement), and economic and technical problems.
Environmental Impacts (top of page)
In the 1983 feasibility study of the project, the environmental impacts of the project were described as manageable, and, on balance, as positive:
"The project will have positive effects with respect to the use of local resources, employment, transfer of technical know-how, promotion of regional development and industrialization, savings of fossil fuel, river regulation, tourism and fishery. Also, air pollution would be reduced due to the replacement of thermal energy. Other ecological effects will be negative, such as the deterioration of the water quality (although temporary) and the danger of the appearance of water-borne diseases. With proper planning of precautionary measures those negative effects can be kept under control and should not lead to long-term detrimental effects."
According to the EIA, the dam would provide a range of benefits, including improved conditions for those affected, flood control, and better river navigation. While a range of impacts were identified in he"preliminary ecological impact assessment", it was concluded that these could be minimized. For example, sedimentation could be reduced to an "acceptable level" that would not affect the project. Sediment inflow was estimated "for the present rate of erosion" as 9 million tons/year. This was considered to have a "negligible" impact on reservoir storage capacity. it was also argued that "the risk of long lasting detrimental effects on men and environment caused by the creation of the Bakun reservoir can be reduced to an acceptable level if appropriate preventive measures are
undertaken". With proper management, the river system could adjust to the changed conditions (for example, the diversity of indigenous fish could ensure that there would be sufficient species to fill all niches within the new reservoir.) It was also argued that "[a]dequate measures will help to prevent long lasting ecological damages as a result of the creation of the Bakun Reservoir thus contributing to a successful implementation of the
project."
Other impacts were less than feared, because of damage that had already occurred. For example, since the reservoir area had already been disturbed by shifting cultivation, impacts would be less severe than if the area were virgin forest. Remarkably, the EIA even claimed that the dam would reduce loss of forests, even though site preparation for the reservoir involved clearing the entire area. Further impact studies were also recommended.
Many of the claims made in this feasibility study could be questioned. For
example, it was specified that during reservoir filling a "mandatory release of 150 m3/s will be maintained to satisfy the needs of the downstream ecosystem". This figure could be compared with the observed unregulated flow, varying from 960 m3/s in July, to 1975 m3/s in November. (It was not explained how 150 m3/s would be sufficient to "satisfy the needs", given these pre-existing flows.) Similarly, while benefits of the project identified in 1983 included regulation of downstream flows, "improving navigation conditions and reducing flood damages", there was no apparent discussion of the inevitable trade-off between flood control and power generation.
Shortly after the release of the 1995 EIA report, it was evaluated by the
International Rivers Network (IRN). The IRN identified numerous shortcomings. While the EIA had identified a range of impacts, including deterioration of reservoir and downstream water quality, impacts on downstream water levels and salt water intrusion, risk of waterborne diseases, loss of fish habitat, and inundation of terrestrial habitat, most
of these impacts were not reflected in the EIA's optimistic conclusions.
The evaluation also concluded that the EIA's "usefulness is severely limited by basic methodological flaws". It had failed to explain why the dam was needed, or to consider adequately the no-project alternative, or other sources of energy. Nor did it evaluate long-term impacts, or interactions between different impacts, such as the effect of water quality on fisheries. It did not even estimate adequately the life-span of the project. Numerous key issues were not addressed at all, and the report relied too much on inadequate data or uncertain predictions. In sum, the IRN said, the EIA "would not meet internationally accepted standards for environmental assessments", and gave no evidence of having benefited from past experience with large reservoirs in tropical areas.
For more information on the environmental impacts of the Bakun project.
Sources:
o Democratic Action Party, "A Preliminary study on the proposed Bakun hydroelectric project," October 1985. [brief overview of environmental impacts, in the context of ethical principles of reverence and respect for the environment.]
o Ekran Berhad, "Privatisation of the Bakun Hydroelectric Project; Detailed Environmental Impact Assessment for Reservoir Preparation," February 1995.
o Philip B. Williams et al., "A Review of the Environmental Impact Assessment [Interim Report] of the Bakun Hydroelectric Project Prepared for Ekran Berhad," Prepared for the International Rivers Network, June 1995.
Social Impacts: Resettlement (top of page)
"We are happy you came among us.
For soon, we worry, we may drown
Because of Bakun.
We are mourning, due to our problems.
Share your ideas with us, so we can have courage.
Please help us, please tell your
friends, and others in the world outside,
that we have our problems
so that you and they can help us
one way or other.
Please remember us and our plight
whereever you go, wherever you may be."
'a parap' (an offering in song and rice-wine) sung by a Kenyah grandmother. The Bakun project would compel relocation of more than 9,000 people, who would lose their land, homes, and every other aspect of 18 communities. Most are now subsistence farmers, with some supplementing their income through cash crops or jobs in timber companies. They value their autonomy: as one stated: "We are poor only insofar as we have little money. In fact, we are rich, because we have all we need to feed ourselves and house ourselves. Rice is free, fish and meat are free, vegetables are free, water is free, lumber is free". After relocation they would likely no longer have their own land, but might have to seek work instead on large plantations.
The need to resettle inhabitants was noted in the project's initial feasibility study of the project. This was seen as a relatively straightforward and inexpensive aspect of the total project: 5200 persons (note population growth in the region to about 9000 since the 1980s) would be resettled into areas having "suitable living accomodation, basic infrastructure, such as schools, medical centres and electricity and water supply, and lands
for planting crops", at a cost of M$65 million. The resettlement program, it was noted, "must cater for the needs and interests of each ethnic group," and accordingly, detailed socioeconomic studies would be needed of these communities.
A few hundred kilometers from the Bakun site sits the smaller Batang Ai dam, completed in 1985. For that project, 3000 people were relocated to an area lacking adequate farmland or jobs, even before their new homes were ready. Many have not yet received fair compensation, and almost half have returned to near their original homeland. Relocation plans at the Bakun site appear not to have benefited from this experience: the time frame for completing the resettlement (by 1998) is unrealistically short, and, as Jérôme Rousseau of McGill University has documented, plans make little provision for the preferences of those to be relocated. While many would prefer to move to higher ground within the catchment area, plans call instead for a move to an area with poorer land and fewer prospects.
Resettlement plans have been marked by a general failure to consult those affected. As Nyaban Kulleh, a resident of one of the communities to be flooded told a journalist in 1994: "no one has come forward to tell us what is happening. We don't want to go against the Government. But if the Government wants the Bakun project, why don't they think of us? They say this is development but we don't think that flooding our homes is development."
Sources:
o Sarawak Museum, "Batang Ai Hydro-Electric Project: Survey on the attitudes of the affected people towards the project and resettlement" Batang Ai Report No. 1, July 1979. [A survey of those to be displaced by the Batang Ai project, before resettlement occurred.]
o "We don't want to leave our land," Utusan Konsumer, Feb. 1986. [interviews with those to be displaced by the Bakun project.]
o Democratic Action Party, "A Preliminary study on the proposed Bakun hydroelectric project," October 1985. [overview of issues relating to resettlement.]
o Insan, Power Play, pp. 74-86. [Critical discussion of resettlement plans for the Bakun project, from the perspective of Malaysian activists.]
o Rousseau, Jérôme, "The Bakun Project: Review of Socio-Economic Studies and Preliminary Recommendations for the Resettlement of the Kayan and Lahanan of the Upper Balui," A report submitted to the State Planning Unit, Jabatan Ketua Menteri, Sarawak, 27 Sept. 1994. [Extensive analysis of Bakun resettlement plans.]
o Rousseau, Jérôme, "The Bakun Hydro-electric Project and resettlement: a failure of planning," Conference on the Bakun Hydro-electric Project, Kuala Lumpur, December 2-3, 1995. [Critical discussion of resettlement plans, from the perspective of a McGill
University anthropologist.]
Technical issues (top of page)
There are many uncertainties concerning technical details of the Bakun project. These include variations in rainfall and streamflow at the dam site, and questions concerning the design and stability of the dam itself. One of the most significant technical worries relates to the cables that will deliver power to the Malaysian mainland. They are, in effect, an unprecedented experiment. At 650 km, they are far longer than the longest existing undersea power cables, beneath the calmer waters between Denmark and Sweden. No reliable estimates of how much these cables will cost, how long they will last, or how much power will be lost as it travels through the cable, are yet available.
Sources:
o Insan, Power Play.
o Malaysia Ministry of Finance, Economic Report 1994/95.
o Aliran Monthly, Vol. 16(5), 1996.
o Wang, WeiLou, "Bakun Hydro-Electricity-Project (HEP) Firm Capacity: Dangerous Tendency" Conference on the Bakun Hydro-electric Project, Kuala Lumpur, December 2-3, 1995. [Argues that predictions of power production are inflated, as estimates of river flow and efficiency of power generation are over-estimated.]
