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dam-l Bujagali editorial/LS


The following is from the Uganda Confidential, No. 367,  Dec 03 - Dec. 10, 1999

EDITORIAL

   IFC not keen on AES funding

   The controversial AES Nile Power will continue to be a news-maker for a
a long time to come. And so will the blindly and corruptly managed Uganda
Power sector.
   So you can look forward for Uganda Confidential's continuous updates on
the new controversies that will continue to dog the dubious AES Nile Power
deals.

   Already, things are moving more in the direction Uganda Confidential
warned about many months ago. In many editions of Uganda Confidential we
advised President Yoweri Museveni and his corrupt politicians in the energy
sector to note that the environment issue is a global issue and that
although they may appear to have succeeded in intimidating the local
environmental crusaders, we warned that once the international
environmental lobby groups step in, Mr Museveni and his government will be
forced to listen to the masters they seem to respect more than their own
black people.

   And this is what is taking shape now. Ron Anderson, principal
Environmental specialist for the environment division of the IFC, is openly
reserved about moving forward quickly in Uganda. "The issues in Uganda are
very complicated" Anderson says, and adds that "a project on the River Nile
may require both a sectoral environmental assessment looking at economic
issues as well as regional environmental assessment looking at power demand
in East Africa. Big hydropower dams on the River Nile may not win out"

   The message is very clear for President Museveni, AES Nile Power and
Syda Bbumba. Although parliament was arm twisted into passing the AES Nile
Power Act, sorry the new Electricity Act, people like Ron Anderson, who are
international civil servants and who have a formidable career to protect
will not be intimidated or corrupted into endorsing a dubious project that
may create conflict around their personality. And that is where the
struggle against AES Nile Power dubious project takes form in the
international arena where international civil servants of the Ron Anderson
type dwarf local politicians of the Syda Bbumba type. In the end Ordinary
Ugandans are the losers. Because people like Kaijuka and Bbumba refuse to
take correct decisions, the power sector continues to be visionless. As of
now there are three hurdles that face the so-called AES Nile power.

   These are questions, which we have raised locally, but since our leaders
seem to have a low opinion of black Ugandans they continued to ignore us.
But sooner or later the donor community will raise the same questions and
that is when the corrupt politician will wake up.

   Question number one: Modern dams are built underwater in order to
preserve the natural beauty of the water falls. Both Canada and the US did
this when they  constructed ten dams under water on their border at the
Niagara Falls. NORPAK is planning to do the same. Donors are likely to
force the AES Nile Power to do the  same in order to preserve the Bujagali
Falls. Once this is done there will be no loser and winner as the
victorious Museveni-Bbumba and AES Nile Power wanted to  impress everyone
that the water falls are a non-issue.

   Hurdle numbers two: The technology of building modern hydropower dams
has made it quite cheap. Experience from elsewhere shows that a megawatt
can be constructed  at about $500,000. Once the donors start to examine the
inflated cost of AES Nile Power, they will certainly insist that the price
come down. In the end the  construction of 150 MW will be deemed to cost
only $75 million which that of 200 MW will be put at only $100 million.
Even if the donors open their hearts and  allow a much higher cost of say
$1 million per MW, the coast will range between $150 million for the 150 MW
and $200 million for the 200 MW. Once that situation is reached chances are
that AES Nile power will cry murder.

   The third hurdle is this: Ugandans have been told about the sweet song
of how Kenya is going to buy power from Uganda to the tune of $120 million
a year. The  truth is this: Kenya is progressing in the war against
darkness, and has constructed more than 500 MW since the NRM Government
came to power yet Uganda has  constructed only 50 MW in the same period. If
Uganda ever manages to produce enough power, which we can't see happening
during the corrupt years of Syda Bbumba, Kenya will then buy it only if the
price is good. But if the tariff is inflated Kenya might as well ignore the
sweet songs about buying Ugandan power.

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      Lori Pottinger, Director, Southern Africa Program,
        and Editor, World Rivers Review
           International Rivers Network
              1847 Berkeley Way, Berkeley, California 94703, USA
                  Tel. (510) 848 1155   Fax (510) 848 1008
                        http://www.irn.org
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