HRW Briefings

Progress at two hydro plants in Vietnam

Vinacomin Power Holding Corp. has awarded a US$26.6 million contract to a consortium of Alstom and Hydrochina Huadong Engineering Corp. to supply turbines and electromechanical equipment for the 154 MW Dong Nai 5 project in Vietnam.

Alstom said it will design, manufacture, deliver and supervise the erection of two 77 MW turbine-generator units and related mechanical and electrical auxiliaries.

The $302 million Dong Nai 5 complex, on the Dong Nai River, is part of Vietnam’s Power Development Master Plan VII and will begin operation in August 2015, Alstom said.

In other news, a consortium of Alstom and Hydrochina Zhongnan Engineering Corporation signed a $144.76 million contract with Electricity of Viet Nam in January to provide electromechanical equipment for the 1,200 MW Lai Chau project. Alstom is to supply three 400 MW Francis turbine and generator sets, as well as mechanical and electrical auxiliaries.

Portugal inaugurates Alqueva pumped-storage project expansion

An extension of Portugal’s Alqueva pumped-storage plant has doubled its capacity to 520 MW. The addition – called Alqueva 2 – was announced by Energia de Portugal (EDP) in October 2007 as a means of storing power produced by southern Portugal’s booming wind sector.

Alqueva Dam is the location of the 520 MW Alqueva 2 pumped-storage facility, which was recently expanded through the addition of two reversible pump-turbine units.
Alqueva Dam is the location of the 520 MW Alqueva 2 pumped-storage facility, which was recently expanded through the addition of two reversible pump-turbine units.

In September 2008, EDP awarded a contract worth US$138.3 million to a consortium consisting of Alstom, EFACEC Engenharia S.A. and SMM of Portugal to equip the Alqueva 2 expansion. Alstom said the group supplied, delivered and installed two 130 MW reversible pump-turbine units and other mechanical equipment, which were officially inaugurated during a ceremony in January.

Alstom also previously supplied two 130 MW reversible pump-turbine units for the first phase of the Alqueva project, which has been operating since 2004.

Hydro activity continues strong in India

Development work is ongoing in several locations in India.

The Permanent Court of Arbitration (PCA) recently upheld India’s right to divert water from a Neelum River tributary for National Hydroelectric Power Corporation’s 330 MW Kishanganga project, being built by HCC-Halcrow Consortium.

At the same time, Pakistan’s Water and Power Development Authority has progressed in its plans to develop the 969 MW Neelum-Jhelum plant, which would be located downstream from Kishanganga on the same river system. Fearing that Kishanganga might reduce the capacity of its Neelum-Jhelum plant by diverting water, Pakistan asked the neutral PCA to resolve the conflict under provisions of the Indus Waters Treaty in 2010.

The court – located in The Hague – ruled that India was adhering to the treaty, which stipulates that the first country to complete its project will have priority rights to the river’s waters.

Advancing work on other Indian plants

India’s West Bengal state hopes to use hydroelectric projects to increase its supply of water and energy, according to a master plan that details potential development along the North and South Bengal rivers.

The plan, released by the West Bengal State Electricity Distribution Company (WBSEDCL), said new conventional and pumped-storage hydro projects in the state could provide capacity of 6,300 MW. WBSEDCL is in the preliminary stages of identifying hydropower potential in existing canals and irrigation systems, is preparing feasibility reports for conventional hydro schemes in Darjeeling, and has identified potential sites for a 1,000 MW pumped-storage facility in Purulia district.

In addition, development of hydropower projects in several Indian states could benefit from the Forest Advisory Committee’s (FAC) reversal of a recommendation in February requiring cumulative impact assessments for three new hydroelectric plants. Affected by the committee’s decision are 800 MW Tawang 2 in Arunachal Pradesh, 520 MW Teesta 4 in Sikkim and 775 MW Luhri in Himachal Pradesh.

FAC said last year that it could not consider giving the projects Stage 1 environmental clearance until comprehensive hydrology, ecology, wildlife, sociology and disaster management studies were complete, although the requirements were relaxed in an effort to help meet India’s growing demands for power, sources said.

Georgia, USAID agreement to increase private sector development

A new partnership between the United States Agency for International Development and the Georgian government is intended to help spur private development of hydro projects.

USAID and Georgia’s Ministry of Energy and Natural Resources signed a letter in January declaring their intent to implement the program – called the Georgian Electricity Market Model 2015 (GEMM 2015) – as a “core strategy” for the country’s energy sector. According to Georgia officials, GEMM 2015 will promote private development of new hydropower construction by giving energy producers easier means of selling their power to Turkey and other regional markets.

USAID has a history of supporting hydro projects in Georgia and said GEMM 2015 grew from the response it received during previous projects. “The hydro electrical power development project initially started with a series of studies to help identify potential investors for one of the hydroelectric facilities,” USAID Mission Director Stephen Haykin said. “In the course of doing this, we were trying to attract investors to Georgia. We got feedback and saw Georgia is in need of changes in policy structures and institutions.”

Georgia’s Ministry of Energy will seek further input from the country’s National Energy and Water Supply Regulatory Commission (GENRC) and local and foreign experts. The ministry said it hopes to have the new market model formed by the end of 2014, with implementation to begin in 2015.

Zimbabwe making Batoka Gorge debt repayments

Debts being paid to Zambia from state-owned Zimbabwe Electricity Supply Authority (ZESA) should help pave the way toward construction of the 1,600 MW Batoka Gorge project. The US$3 billion plant is being developed by the Zambezi River Authority, which is jointly owned by Zimbabwe and Zambia.

Batoka Gorge on the Zambezi River will be the site of a 1,600 MW hydro project jointly owned by Zimbabwe and Zambia.
Batoka Gorge on the Zambezi River will be the site of a 1,600 MW hydro project jointly owned by Zimbabwe and Zambia.

ZESA Chief Executive Elijah Chifamba told a parliamentary committee in February that the utility will have paid Zambia $40 million of its $70 million in debt by the end of March, allowing development to proceed. “Zambians needed to see first that we were committed to settling that debt and to demonstrate that we are bona-fide partners before they could actually enter into the Batoka project,” Chifamba said. “Because we have done so, that has unlocked the project.”

Development of Batoka Gorge is seen as crucial for Zimbabwe, whose industries have been crippled by a lack of available power and load shedding.

Update on hydro development in Nepal

Production at Nepal’s 60 MW Kulekhani 1 project was cut in half by a short circuit in a cable that occurred in February. The project – on the Kulekhani River – is the only reservoir-type hydroelectric plant in the country, according to owner the Nepal Electricity Authority (NEA).

Kulekhani 1 is intended to provide power for peak demand and emergencies, although NEA said recent rainfall in the area should allow other run-of-river facilities to keep pace with demand.

NEA said repairs would take about a week, although a more permanent replacement cable would be installed as soon as possible. That process, NEA said, might take months.

In other Nepal hydro news, the Asian Development Bank (ADB) and Japan International Cooperation Agency (JICA) have agreed to finance two-thirds of Nepal’s 140 MW Tanahun project. JICA and ADB said they will provide $150 million each after negotiations completed in February. The JICA loan will carry 0.01% interest with a 40 year payback period, while the ADB loan has a 1.5% interest rate over 30 years.

Official loan documents have not yet been signed.

Sources report the European Investment Bank (EIB) has expressed interest in financing at least part of the Tanahun project’s remaining costs, although officials said negotiations have not taken place yet.

The run-of-river project will be built on the Seti River and could be generating power by 2020, assuming NEA can begin construction in 2014 as proposed.

RusHydro announces consolidations, objectives for 2013

Russian hydropower project operator JSC RusHydro has announced it will reorganize the company’s hydro engineering operations by consolidating its three subsidiaries.

As per an in absentia meeting of the RusHydro board of directors in February, the consolidation “aims to improve project complex efficiency and increase the total economic effect through better usage and planning of hydro engineering resources.”

Included in the consolidation are JSC Institute Hydroproject, JSC Lenhydroproject and JSC Mosoblhydroproject. The three will now operate under the “JSC Incorporation Hydroproject” banner, which will be wholly owned by RusHydro.

According to RusHydro, the three groups have “similar capabilities and functions that often overlap,” although Institute Hydroproject and Lenhydroproject have more “expertise in developing comprehensive and complex hydro engineering projects,” while Mosoblhydroproject specialized in small and medium hydro project developments.

The board also identified several hydropower-related priority objectives for 2013, including reliability and modernization of operating plants, operations and maintenance efficiency improvements, and increased capacity through implementation of investment projects.

Syrian rebels take control of 824 MW Tabqa project

A group of rebels took control of the 824 MW Tabqa project and the lake it impounds on the Euphrates River in February. Tabqa and Lake Assad – Syria’s largest hydropower plant and biggest reservoir – are in the northeastern Raqqa Province and help power the contested city of Aleppo.

Sources said the dam seizure comes after Syrian President Bashar al-Assad has been denying power to rebel-held areas as a means of turning the population against the insurgent forces.

Syria’s government has not confirmed that Tabqa is in rebel hands, although the United Kingdom-based Syrian Observatory for Human Rights said the insurgent group had captured both the powerhouse and areas in the nearby town of Al Tabqa.

Tabqa Dam on the Euphrates River in Syria was reportedly taken over by rebels in February, along with the 824 MW powerhouse and the lake the dam impounds.
Tabqa Dam on the Euphrates River in Syria was reportedly taken over by rebels in February, along with the 824 MW powerhouse and the lake the dam impounds.

Laos: Land lease advances development, update on Xayaburi

A 32-year land lease will allow investors to continue development of the 390 MW Xe-Pian Xe-Namnoy project in Laos’ Champassak and Attapeu provinces.

The US$830 million plant is a venture of the Laotian government (24%), Korea’s SK Engineering & Construction Co. Ltd. (26%), Korean Western Power Co. Ltd. (25%) and Thailand’s Ratchaburi Electric Generating Holding PLC (25%).

The group signed a project development agreement with the Laotian government in November 2008.

Now with a land lease worth about $1 million, construction of Xe-Pian Xe-Namnoy (also spelled Xae Pien-Xae Nam Noi) is expected to begin in July. The project will create a reservoir that will cover about 238 hectares in the Xe Kong River Valley and reflects Laos’ efforts to become the “battery of the region.”

When completed in 2019, officials said about 90% of the power generated will be exported to Thailand.

In January, governments and organizations used the 19th Mekong River Commission (MRC) Council Meeting to voice displeasure with Laos’ 1,285 MW Xayaburi project. Although Poyry Energy Business Group was selected in November 2012 to supervise construction of the US$3.5 billion run-of-river plant, some members of MRC and their international partners have expressed concern that the prior consultation process was not adequately completed. “It is our consensus that building dams on the mainstream of the Mekong may irrevocably change the river and hence constitute a challenge for food security, sustainable development and biodiversity conservation,” a statement from MRC’s international partners said. These partners – which include the European Union, USA, Australia, New Zealand, World Bank and Asian Development Bank – are concerned that Laos has not addressed the concerns of other MRC members.

MRC was founded in 1995 and consists of Laos, Cambodia, Thailand and Vietnam. The council is intended to provide a forum for cooperative use of the Mekong River, but the Cambodian, Thai and Vietnamese representatives said Laos did not complete its due diligence before moving forward with Xayaburi.

At a Special Joint Committee Meeting in April 2011, Vietnam proposed a 10-year moratorium on decisions regarding mainstream dams on the Mekong. The Laotian government appeared to accept Vietnam’s proposal and announced it would suspend development of Xayaburi during the 18th MRC Council Meeting in December 2011, pending further impact studies.

However, in October 2012, the Andritz Group announced it was awarded a $322 million contract by CH. Karchang Public Co. Ltd. to supply electromechanical equipment for the plant. Laos now says a cofferdam will be complete in May, with construction of Xayaburi to begin in full shortly after.

WAPDA moves forward on several projects in Pakistan

Pakistan’s Water and Power Development Authority (WAPDA) began mechanical runs of its 121 MW Allai Khwar project in February and anticipated power generation by the end of the month. WAPDA said Allai Khwar was expected to begin commercial operation the first week of March.

Allai Khwar – built on an Indus River tributary of the same name – includes an 88 meter-long by 51 meter-tall concrete dam, a 2.3 km-long steel-lined tunnel and two 61.5 MW turbines.

The project is the second of three WAPDA high-head hydroelectric complexes that have been developed in recent years. Also included are 72 MW Khan Khwar, which went online in November 2010, and 130 MW Duber Khwar, which WAPDA said will be commissioned soon.

In related news, WAPDA expects to begin construction of its 122 MW Keyal Khwar plant in April. WAPDA said engineering design and prequalification of firms for civil and electromechanical works must be completed before work can begin, but that it expects those prerequisites to be completed “very soon.”

The US$242.6 million Keyal Khwar plant will be located on Keyal Khwar River, which is a tributary to the Indus River in the Khyber Pakhtunkhwa province.

These projects are being developed as part of WAPDA’s “least-cost energy generation and water storage plan” that could include as many as 26 hydro plants with 21 GW of installed capacity.

Pakistan sees Indus Water Treaty from Pakal Dul plant

Pakistan’s Punjab Irrigation Department has objected to Indian plans for a new 1,500 MW plant at Pakal Dul Dam.

India’s proposed Pakal Dul project – to be located on the Marusdar River in Jammu and Kashmir – is subject to terms of the Indus Waters Treaty of 1960 because the Marusdar is a tributary to the Chenab River. Sources said India submitted the proposal to the Pakistan Commission for Indus Waters, which forwarded it to the Punjab Irrigation Department for analysis.

According to India’s plan, the Pakal Dul complex would include a 87,500 m3 reservoir that would be impounded by a concrete-faced rockfill dam 1,708 meters high.

The Irrigation Department is concerned that Pakal Dul Dam could decrease the flow of water into Pakistan, which violates the treaty. The department has also questioned several design aspects that, according to Pakistan, are cause not to endorse the project.

Armenia developing, rehabilitating hydro projects

An agreement signed in February at the Armenian National Assembly will allow for construction of two hydro projects along the Aras River on the Armenia/Iran border.

The two governments signed agreements in 2007 and 2008 allowing for construction of the 130 MW Meghri and 130 MW Karachilare (also spelled Gharachilar or Ghare Chiler) plants. Meghri – under construction as of November 2012 – will be on the Armenian side, with Karachilare on the Iranian side.

As per draft laws adopted by the Armenian National Assembly, Iran will fund construction of the US$400 million Meghri project in exchange for the electricity produced until Armenia’s debt is repaid. Sources said repayment will likely take 15 years, at which point Armenia will assume control of the plant.

Construction of the plants is being undertaken by the Farab Sepasad Co. Each powerhouse will include two 65 MW hydro turbines. Completion is expected within the next five years.

EBRD loans to finance Armenian rehabilitation projects

The European Bank for Reconstruction Development (EBRD) has provided a US$25 million loan that will help fund International Energy Corporation (IEC) rehabilitations of seven hydro projects in Armenia’s Sevan-Hrazdan Cascade.

The stations are located along the Hrazdan River and have a total combined capacity of 565 MW, or about 10% of Armenia’s annual production. The plants were constructed between 1936 and 1961 and have received little investment since, EBRD said. IEC’s rehabilitations will raise the facilities to modern technical standards and restore their lost capacity.

Brazil: Continuing to be a hotbed for hydro

Significant new hydroelectric development work is ongoing in Brazil, although the current drought raises questions as to whether consumer demand can be met by these facilities.

Energy tax reform announced by Brazilian President Dilma Rousseff in September 2012 will force power distributers to slash tariffs by 18% for residential customers and more than 30% for industries. The new policy is expected to have a marked effect on utility company and hydro project operator Eletrobras’ budget, with profits projected by some analysts to drop at least 30% through the next year.

To respond, Eletrobras is in the midst of a restructuring plan it expected to be complete in March. The company says it will utilize “synergies between subsidiaries and propose a framework for management of generation assets, transmission and distribution compatible with the new regulatory landscape” to cut costs.

In early February, Alstom shipped the first stay ring to the 373.4 MW Santo Antonio do Jari plant. The company is also supplying Kaplan turbines, generators, hydromechanical and lifting equipment, a distributed control system and engineering works, along with erection, supervision and commissioning services. Santo Antonio do Jari is being built on the Jari River in Brazil’s Amazon region. Commissioning is expected for late 2014.

Voith Hydro received a contract for work on this plant in January, and the company will supply and install a Kaplan S turbine, a generator, automation systems, and related electrical and mechanical parts. This will expand capacity by about 3.4 MW.

Speaking of new development, in January ANEEL authorized the start of commercial operation for the 10th turbine at the 3,150 MW Santo Antonio plant. The Santo Antonio complex is on the Madeira River in the Amazon basin. The plant is part of the 3,750 MW Jirau project, which received an operating license from Brazil’s Institute of the Environment and Natural Resources (IBAMA) in October 2012.

Santo Antonio’s newest turbine unit adds 69.6 MW to the plant’s existing 713.5 MW of capacity. The turbine is the second in Santo Antonio’s Power House II, which is located on the left bank of the Madeira River. According to operator Santo Antonio Energia, another 17 turbines will enter commercial operation in 2013, totaling 27 generating units in production.

Sources report that Brazil’s dry summer is depriving hydro plants of water, straining the available power supply and causing fear that the country will face energy rationing. Brazil’s national electrical system operator, ONS, said reservoirs are at 31.61% capacity in the northeast and 41.24% in the north region.

Meanwhile, the Brazilian Association of Independent Power Producers said reservoirs for hydro plants in the southeast and midwest are at 28.9% – just 0.8% above the minimum levels required to meet demand at full load.


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