Will the Grand Inga Dam be everything it promises to be?

Will the Grand Inga Dam be everything it promises to be?

The Grand Inga dam is expected to resolve the current power shortages in Africa, which are currently damaging the continents ability to grow its mining industry and therefore slowing economic growth.

Liberia targets an annual economic growth rate of on average 6%
South Africa will export its independent production of renewable energy program
What Future for the Mining Industry in South Africa ?

Background

The World Bank and the African Development Bank originally approved the grants for this $14 billion project in 2013 and 2014 with an initial injection of capital totally $141 million.

The Grand Inga dam is expected to resolve the current power shortages in Africa, which are currently damaging the continents ability to grow its mining industry and therefore slowing economic growth. It is forecasted that in phase one the dam will initially produce 4,800 megawatts, of which 2,500 megawatts will be purchased by South Africa. On completion the final hydropower complex is anticipated to produce up to 50,000 megawatts of power.
Agreements to export some of this power are currently being negotiated by the DRC government with both Nigeria and Egypt, including the General Authority of Suez Canal Economic zone.

Whilst many have expressed concerns about the true benefit of this enormous project; the world’s biggest hydropower scheme, there is a general feeling of reassurance that by including a number of multilateral financiers, the project will at least have to adhere to international environmental, social and anti-corruptions standards.

Delays

Since 2015 the level of confidence in these reassurances has begun to wane following the refusal of the DRC government to work with the Australian company SMEC who originally won the contract to complete the environmental and social impact assessments, as well as compile an action plan for any resettlement challenges. This has resulted in a stagnation of the project and two years since the grants were originally approved, impact assessments are still yet to begin.

In May 2016 the government of the DRC, starting to feel the pressure, committed to selecting the developers for the project within the next three months, and at the same time confirmed that the construction of the dam would begin by June 2017. Bruno Kapandiji, the project director has stated that he hopes the contract will be awarded to a Chinese consortium who have pledged to complete the project in a “maximum of five years and if they’re free to do whatever they want to do they can even do it in four years.”

China is already Congo’s biggest trading partner, they also already have a number of large mining and infrastructure projects underway with Chinese companies, including Sinohydro one of the consortium partners vying for this contract.

Corruption

This sudden acceleration is partly explained by the fact that South Africa will be the primary consumer of the dam’s electricity, and the contract between the two countries is due to expire in 2021. This is of particular concern because if allowed to expire, the renewal of this contract would be unlikely in the absence of President Zuma who is due to step down in 2019, as it faced significant opposition from within South Africa at the time.

In addition to this, President Kabila is in the process of trying to extend his reign as Congolese President due to end in December 2016, and a multi-billion-dollar project of this type would certainly assist him to achieve this as it would make a huge amount of money available to him, some of which could then be used to bride any people in positions of power that are raising concerns about the project.

It is well known that the DRC, in particular large infrastructure projects in the DRC, are prone to corruption, and only time will tell if the Grand Inga Dam project becomes a victim of this in the years to come.

Environmental and social impact concerns

Whilst hydropower is a clean renewable source of energy, there are significant concerns about the impact this project will have on the area, both environmental and social, including the displacement of potentially over 50,000 people and damage to the fisheries in the Lower Congo. Alarmingly however since refusing to work with SMEC, the Congolese government has made no attempt to commence the environmental and social impact assessments, stating that the initial feasibility studies (which did not include environmental impact assessments) indicated that the project wouldn’t have any negative impact on the surrounding area.

There is no doubt that the energy produced by the completed hydropower complex will hugely benefit industry in Africa, there are however concerns that the general population of the DRC, 91% of whom currently have no electricity, will not benefit to the same extent, if at all.

If the contract is won by the Chinese consortium as many are predicting, it is hoped that they will insist on the completion of all the necessary impact assessments, as in the past the Chinese government has committed to ensuring no projects are started without the completion of detailed and thorough environmental assessments.

COMMENTS

WORDPRESS: 0
DISQUS: 0
%d bloggers like this: