Tradeoff analysis between electricity generation and ecosystem services in the Lower Mekong Basin

Abstract

The Mekong River is the largest freshwater fishery and the third most bio-diverse river system in the world. Two of 11 planned mainstream hydropower projects, Xayaburi and Don Sahong, are nearly completed and a third project proposal, Pak Beng, has been submitted by the Lao PDR government for consideration. This paper builds on previous studies and examines the tradeoffs (between water use, food security supply and energy production) for the proposed mainstream hydropower projects in the Lower Mekong Basin (LMB). The paper concludes that the forecast loss of capture fisheries, sediment/nutrients and social mitigation costs measured as Net Present Value (NPV at 10% discount rate) are greater than the benefits from electricity generation, improved irrigation and flood control. The paper also forecasts huge negative economic impacts for Cambodia and Vietnam in contrast to previous Mekong River Commission's (MRC) conclusions that all countries will benefit from hydropower development. The paper recommends reassessing the economic impacts of hydropower development using full environmental cost accounting. It also recommends that a new LMB energy strategy be developed taking into account less hydropower income than previously anticipated, updated forecasts for LMB power demand and anticipated technology developments for improved energy efficiency & renewable energy (especially solar which is now competitive with hydropower). Show more