Carbon Market Watch

For fair and effective climate protection.

Large hydro power up for registration despite serious protests by local communities (Newsletter #5)

01 Dec 2009

The 24 MW Bhilangana – III Hydro Power Project is currently being established at the Bhilangana river, the tributaries of Bhagirathi River in the Tehri District, Northern India. The project has applied for CDM in January 2008 and is has now requested registration.

Further to some alarming hints by local communities, CDM Watch visited the dam area. When approaching the village, we were forced to stop 1 km downhill of the village because landslides caused by the construction had made the road impossible to pass. Meeting the villagers in a neighbouring place, they told us that they were neither consulted nor informed about the project but had only noticed because their houses started trembling as a result of the explosions for the tunnel construction. The agreement between the Government of Uttarakhand and Polyplex Corporation Ltd as the constructor of the project was signed in November 2003. But villagers of Dewlang and others only learned about the project when construction commenced in May 2007.

Ever since, an emotional battle of representatives of 14 villagers is ongoing. Villagers keep protesting against the construction of the run-of-river project but are being ignored. Following empty promises about compensation of suffered losses and witnessing bribes between local government and project proponents, one villager event went on hunger strike for 56 days. Another representative of the village has now gone to court to claim the relocation of affected individuals to suitable places.

He claims that due to the construction of the Bhilangana- III Small Hydro Power Project, life in Dewlang village has been made impossible and that the life of hundreds of people inhabiting neighbouring 14 villages has been negatively affected. Because of the explosions caused by the tunnel construction, a large part of the houses suffered severe cracks and some houses even collapsed.  Cracks are visible throughout the whole hill and have shifted the natural path of groundwater, diverting the fresh water sources that once nourished the villages. Classes in the local school have to be held outside because parents fear the collapse of the building. Moreover, neighbouring villages suffer similar damages, including barren fields caused by the polluting dust from the construction site and disappearing fresh water sources.

People in the village are desperate. “We don’t want this project. It is ruining our life”, they told us when we departed.

Sadly, this story does not come as a surprise. International Rivers has covered numerous projects that are responsible for the displacement of thousands of people; the “contribution for sustainable development” remains questionable most of the times. Project proponents argue that the construction and maintenance of the projects have generated job opportunities and that the power generated by these projects has increased the life style of the villages in the surrounding areas. Well, when we asked the villagers they said that there no local people were working for the construction of the site. Instead, Nepalese people who get lower wages than local people were contracted. They live now in shags next to construction site and will move on to the next projects, once Bhilangana- III Small Hydro Power Project is finished.

According to the PDD, the crediting period should start in September 2009 but villagers don’t think that the project will be finalized anytime soon. However, until 2012 the 24 MW project should be running a total of 5613 hours and is supposed to reduce 102.000 tonnes of CO2 which should add up to a sum of 1.021.000 tonnes of CO2 by 2020.

Hydro power projects are seriously undermining the objectives of the CDM. The vast majority of CDM hydro power projects have not contributed to any sustainable development. On the contrary, they are destroying homes and lives on a daily basis. When it comes to their environmental effectiveness, similar questions concerning additionality remain: In the case of Bhilangana III, allocation of the project to Bhilangana Hydro Power Limited (BHPL) happened in November 2003. Given that this was still one year before it was clear that the Kyoto Protocol would enter into force, and before the first CDM project had registered, it is extremely unlikely that BHPL’s decision in November 2003 took the CDM seriously into account. If the CDM had influenced bank decisions to lend to the project, the developer should have included the IRR analyses on which those considerations were based. Just mentioning this influence is not evidence enough. Lastly, it certainly is possible that the high project risks could have caused the developer to abandon their bid for the project. But simply listing barriers which are also faced by many small hydropower developers in India does not prove that the developer would have abandoned the project. In sum, the additionality of the project is unlikely, and not convincingly proven.

Bhilanghana III should never be registered as a CDM project as it fails to comply with the rules of the World Commission of Dams (WCD) and undermines the goals of the CDM as laid out in decisions by the COP/MOP Kyoto Protocol Article 12(b): “the purpose of the clean development mechanism is to assist Parties not included in Annex I to the Convention in achieving sustainable development and in contributing to the ultimate objective of the Convention”. However, the project developers should be held responsible for relocating the villagers to a suitable place so that they can continue their lives.

Action to be taken by the Board: In order to safeguard the principles of the CDM, the Board should take all necessary steps to reject project activity 2936 “24 MW Bhilangana – III Hydro Power Project”. Moreover, the Board should seriously consider whether large hydro in India and China meet the additionality criteria of the CDM. All large hydropower have a high likelihood of being non-additional because large hydropower is common practice wherever there are hydropower resources, because financial assessments of hydropower are notoriously inaccurate, and because hydropower is commonly built when it is not the least cost option (World Commission on Dams). The Board should then take necessary steps for exclusion similar to the case of wind power projects in China.