Thailand’s National Energy Plan (NEP), a blueprint for the country’s energy strategy from 2023 to 2037, has earned praise for its noble goal of increasing the use of clean, renewable energy. The plan states that by 2050, half of the electricity consumed locally must be clean and renewable energy — solar cells, wind, biomass, small nuclear and hydro dams.
It must be noted that a large share of renewable energy comes from hydro dams, most of which are built on the Mekong River in the territory of the Lao PDR. The Electricity Generating Authority of Thailand (Egat) has signed agreements with Laos to buy 10,500 megawatts of electricity from hydro dams built in Laos — ie the 1,285-megawatt Xayaburi, Don Sahong, Luang Prabang, Pak Beng, and Pak Lai dams.
These schemes are co-invested by Thai investors. In terms of the energy business, the Mekong River has become a hot spot for investors to build hydro dams to sell to governments that are trying to reduce emissions. For instance, Thais have invested in major dams that sell electricity to Egat.
The hydro-dam industry has a unique contractual obligation. For instance, hydro dams selling electricity to Egat will sign a so-called “take-or-pay” contract — a price-guaranteed contract to draw investors to place huge sums of money to build large public infrastructure projects.
Despite Thailand having an overall 30% surplus of electricity, Egat must buy all energy produced from these schemes, including unused electricity. Egat then transfers energy purchase costs in the electricity monthly bill under the category of “Ft” (Fuel Tariff) in monthly bills. That explains why hydro dam projects are a good investment.
While making electricity from water flow appears friendly, policymakers largely sideline issues such as environmental and social impacts. Such debate is crucial, as the world is facing environmental problems and competition over natural resources.
In terms of carbon emissions, methane gas from hydro dams is often ignored. Methane is one of the greenhouse gas emissions. It might be lesser known, but it is more than 80 times as potent as CO2. According to the International Energy Agency, since the Industrial Revolution, it has contributed around 30% to global warming.
An academic study, “‘Reservoir CO2 and CH4 emissions and their climate impact over the period 1900-2060’”, carried out by Sara Mercier-Blais, Research Associate at the Université du Québec à Montréal (UQAM), stated that one billion tonnes of carbon dioxide (CO2) of methane come from reservoirs, some of which are large dam reservoirs.
Methane is generated in freshwater sediments through microbial decomposition of carbon-rich organic matter in oxygen-depleted conditions, prevalent in environments like tropical swamps, peat bogs, and waterlogged soil in reservoirs, as well as rice fields and dairy farms.
Methane emissions from reservoirs (hydroelectric and others) accounted for 5.2% of anthropogenic methane emissions in 2020.
Despite this, Mercier-Blais warns that some new reservoirs expected to be built in warmer climates in the future could potentially involve higher methane emissions, depending on the site.
Governments have tried to reduce methane on a global scale. Hence, about 150 countries have committed to the Global Methane Pledge, aiming to reduce methane emissions from human activities by 30% from 2020 levels by 2030. It needs to be said that the Thai government delegates who attended the COP in Glasgow did not join the Global Methane Pledge.
Large hydro-dam schemes, such as the largest dam in the world, the Three Gorges Dam in China, have been criticised for the environmental and social impacts they caused. Thousands of communities were uprooted for the construction of the Three Gorges Dam.
Closer to our memory is the Pak Mun Dam. The small hydro dam was built over three decades ago on the Mun River in Ubon Ratchathani province. Built and operated by Egat, the benefits of this 136-megawatt hydro dam were overshadowed by the lasting social and ecological impact it caused. Despite the hydro dam producing a small amount of electricity only during the wet season when water in Mun River is abundant enough to run the turbine, communities relocate. Local free fisheries were replaced by commercial fish farms after the dam structure was built.
Dams built on crucial transboundary rivers like the Mekong also face similar criticisms.
The Mekong River Commission (MRC), a regional body overseeing the use of the river, has warned that planned mainstream dams could result in the loss of one million tonnes a year of Mekong fish catches. The MRC also forecasted that the flow of sediment and nutrients to the Mekong Delta in Vietnam would be reduced by nearly 100%, which would seriously impact the Vietnam farm economy that relies on nutrient-rich alluvial sediment carried downstream. The Mekong Delta produces about 50% of Vietnam’s rice and accounts for 30% of the country’s GDP.
Upstream Chinese hydropower projects and existing Mekong tributary projects in Laos have already changed the annual Mekong flood pulse. In April, Vientiane experienced a few hours of blackout after the water in the Mekong ran dry. The abrupt change in water levels is linked to upstream dams collecting water in their reservoirs to produce electricity. Downstream, the change in the water level in the Mekong River has affected the annual expansion of Tonle Sap Lake and drastically reduced the Tonle Sap fish catch in Cambodia. The change in the Mekong water flow has also increased river bank erosion.
The Social Impact Assessment (SIA) conducted in 2010 for the Xayaburi Dam project, in consultation with the MRC, indicated that approximately 4,000 households would be directly affected. However, International Rivers (IR), an international environmental NGO, challenged that the actual impact could be much larger, affecting up to 200,000 people.
The question is how countries on the Mekong River or communities can measure the real impact of dam projects. Any projects proposed on the lower Mekong must be tabled for discussion among the governments of the four countries — Thailand, Laos, Cambodia and Vietnam — that signed the Mekong Agreement in 1995 and formed the Mekong River Commission (MRC). They cannot veto the projects; they only raise concerns about negative transboundary impacts.
Look at the environmental impact study of the Pak Lay Dam. In 2018, Save the Mekong—a coalition of civil society organisations in the Mekong region — publicly stated that at least 90% of the Social Baseline Conditions section of the Pak Lay Dam report had been directly used in the Pak Beng Dam project, rendering the report unsuitable for consideration as Pak Beng Dam is still under construction.
The Luang Prabang Dam, positioned only 25 km upstream from Luang Prabang City — a Unesco World Heritage site and the ancient former capital of Laos — raises particular concerns. Critics warned about the impact of seismic activity due to the dam’s location. It is also under construction.
A decision on an energy project is challenging, especially when environmental factors such as emission reduction and social and ecological impact are involved. After all, energy policy is a complicated matter. Policymakers cannot make simple trade-off decisions based on financial viability.
We must constantly ask our policymakers and ourselves: is this choice good for the environment? Is there any better option that does not require us to trade off between energy and social and ecological impacts?
Kongpob Areerat is a communications manager and researcher at Climate Finance Network Thailand (CFNT), a think tank devoted to propelling sustainable financial practices and assisting in Thailand’s transition towards a low-carbon economy. Access to previous articles and related data can be found at https://climatefinancethai.com.