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Reducing Conflicts Between Hydropower And Fish Can Lower Investment Risk

Fish commute, just like many of us do.

And when the route of commuting fish — migrating sometimes hundreds of miles up a river to spawn — runs into a hydropower project, that can spell trouble. For people, not just fish.

Especially if the fish provide the greatest source of protein for your country’s population, while hydropower is one of your country’s primary options for electricity expansion.

Such is the case in Myanmar, whose energy choices risk colliding with how its people have always provided food for themselves.

Like here In Lonton, a town on Indawgyi Lake in the country’s far north. Framed by lush mountains, Indawgyi is Myanmar’s largest lake. Morning and evening rush hours here aren’t on the single-lane road (with its lounging cows and dogs and sparse traffic) but on the lake itself, where hundreds of boats putter out from six villages in the evening to set long drift nets or deploy boxlike bamboo shrimp traps and then head out again in the morning to pick up their catch.

I’m here as part of a multi-week trip traveling around the basin of Myanmar’s massive Irrawaddy River, where more than 30 large hydropower dams are in various stages of planning or preparation. In interviewing about 60 fishermen around Indawgyi, I’ve learned that nearly all of the lake’s major fish populations migrate—up its small tributary streams or moving back and forth between the lake and the Irrawaddy River.

The hydropower-fish conflict in Myanmar attracts attention due to its considerable environmental and social risks — a conflict well known in U.S. and Canadian salmon country. But it’s the improved management of investment risk that may point a way out of the conflict here and around the world.

The Mekong’s lessons on hydropower and fish

Scientific data on Irrawaddy fish populations are relatively sparse beyond studies on their aggregate value as sources of food and livelihoods. But that value is huge.

Fish provide 60 percent of Myanmar’s animal protein, with fish harvested from lakes and rivers providing one-third of the total. Further, 12-15 million people (out of a total population of 55 million) in Myanmar earn money from fisheries, which are a primary source of cash for low-income people.

With hydropower projects on the horizon, scientists are ramping up their studies of the Irrawaddy’s fish populations. In the meantime, the Irrawaddy’s neighbor in Southeast Asia, the Mekong, has been studied for decades — and provides insights into the likely impacts of conflicts between hydropower and fish in a large, tropical river basin.

For the Mekong, scientists forecast that construction of the proposed dams on the river’s main stem would cut the basin’s fish harvest by 40 percent — a loss of a million tons, valued at USD $500 million, per year. Offsetting this loss would require a huge increase in land dedicated to other sources of protein — this in a region where arable land is already limited.

Meanwhile, even at full development, Mekong hydropower would only provide 6 percent to 8 percent of the region’s electricity supply by 2030. Scientists have begun to demonstrate that more strategic approaches to planning dams — particularly avoiding those that have the greatest impact on fish — could identify more balanced development pathways. Several studies, for example, show that foregoing developing one-third of proposed hydropower capacity could significantly minimize fish losses.

One-third of hydropower capacity sounds substantial, but it represents just a few percentage points of the region’s future electricity demand. Together, the rapidly dropping cost of other renewables and the significant fisheries benefits from a shift in hydropower’s trajectory suggest that the Mekong region’s energy future still merits vigorous debate.

The Irrawaddy basin is at a far earlier development stage than the Mekong. So in theory, there is much more time for scientific analyses to identify balanced pathways for Myanmar’s energy future.

Managing hydropower’s environmental and social risk to reduce its investment risk

But system-scale solutions to the hydropower-fish conflict have proven difficult to translate into reality across the world. Decisions on hydropower tend to be made at the scale of individual projects, not at a strategic basin level. So changing project-level decisions will require evidence that is compelling and relevant for those that makes decisions at that scale, including investors and developers.

That means evidence about investment risk and returns.

We already have considerable evidence from recent studies about hydropower’s investment risks — particularly about frequent delays and cost overruns. For instance: EY found that, among various types of large infrastructure projects, hydropower had the highest frequency of cost overruns (86% of surveyed projects) and the highest average cost overrun (64%).

What’s causing those overruns and delays? Many reasons – but conflict from environmental and social risks are among the main contributing factors, particularly for large dams.

A recent study by The Nature Conservancy, featuring modeling analyses from the Brazilian energy consulting firm PSR, found that the return on investment from hydropower projects could increase by improved incorporation of environmental and social risk into decisions about which hydropower projects to build, compared to status quo project selection.

In other words, better use of information can help developers avoid environmental and social risk—translating into reduced investment risk and higher returns.

Our growing science on hydropower and river systems— including findings that identify system pathways to balance fish and energy, that quantify hydropower’s high investment risk, and the initial study suggesting improved returns through better risk management — collectively illustrate the potential for Myanmar to develop energy with far lower environmental and social impacts.

But beyond studies, Myanmar has its own dramatically tangible demonstration: the high impact Myitsone hydropower project on the Irrawaddy which, now suspended, has turned into a global case study of investment risk.

In the next few blog posts, I’ll explore further how Myanmar can move past Myitsone and meet the energy demands of its growing economy without losing the diverse environmental and social values of the Irrawaddy.

Source : Forbes

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