Why is the World Bank supporting the Trung Son Hydropower Project?
The Trun Son Hydropower Project will help Vietnam meet growing demand from households and industry for electricity while contributing to the climate change agenda. Consumption of electricity has been growing at 15 percent annually for the past several years, with demand expected to increase as the country aims to achieve middle income status. In this respect, hydropower is a vital source of renewable energy offering a least cost solution. The site for Trung Son was chosen based on analysis to optimize hydro production while minimizing environmental and other risks, in particular the number of people affected by the project. Financial and technical assistance provided by the Bank will also improve social, environmental and dam safety practices in the country’s hydro sector.
What benefits will the Trung Son Hydropower Project bring to the people of Vietnam?
Trung Son is a multi-purpose hydropower project, bringing flood control and irrigation benefits to rural and poor communities in the area, as well as helping to meet Vietnam’s increasing domestic demand for electricity. It is expected to generate 1,019 GWh/year out of the additional 10,000 GWh/year needed, according to conservative estimates following the 2008 global economic crisis. More electricity will be added to the national grid, while CO2 emissions of about 1 million tons per year will be avoided – contributing to Vietnam’s energy mix and energy security in an environmentally and socially sustainable manner
What measures are being taken to address social and environmental impacts in the project area?
The project includes various development programs to address social and environmental concerns, particularly to support people living in the project area. About 10,600 persons, or 2330 households, are expected to be directly or indirectly affected by dam and ancillary works construction. For example, community livelihood restoration and resettlement programs provide for the construction of roads, power supply and water services for households, irrigation, schools and housing. A public health action plan for resettlers will ensure that assistance is available. Environmental management activities to support biodiversity and cultural resources are also in place. More information about these plans is available on the Project Documents Page of the Bank’s Trung Son website.
How are local people being involved in the project throughout preparation and implementation?
Throughout preparation, multilingual consultations were conducted to make sure that people affected by the project were informed and understood the impacts as well as measures for mitigation. These were held at the hamlet or village level led by respected members of the community. Communities will continue to have opportunities to voice concerns during project implementation.
The Bank’s counterpart, the Trung Son hydropower Company, has a community relations program to address concerns and complaints from people and communities affected by the project. It will also provide information and serve as the point of contact for the resolution of complaints and grievances. The program is budgeted and staffed by the Company, and is part of its social and environmental unit.
Trung Son Hydropower Company website (www.trungsonhp.vn) will disclose key project documents. The Bank’s Trung Son website (www.worldbank.org/vn/trungson) is another source for information.
How will the project tackle the challenge of governance and accountability in Vietnam?
A specific action plan for Governance and Accountability has been created, and both Vietnam Electricity and its subsidiary, Trung Son Hydropower Company have made a commitment to undertake practical and innovative initiatives that can be implemented within existing regulations, policies and procedures. More detailed info can be found in Annex 12 of the Trung Son Hydropower Project Appraisal Document
How will the World Bank report on progress of the project?
In addition to publicly available documents related to the disbursement of funds and the “Status of Projects in Execution”, which provides information on all IBRD, IDA, and trust funded projects that were active in a given fiscal year, the new World Bank Access to Information policy provides for further public reporting during implementation periods in its “Implementation Status Report (ISR)”. The first ISR for Trung Son is expected to be issued in early summer 2011, about two months after project approval by the Board of Executive Directors.
What is the significance of an IBRD loan for Vietnam?
IBRD (International Bank for Reconstruction and Development) loans typically serve middle income countries, and low-income countries with a per capita income of less than $1,000 are eligible to receive low or no interest loans and grants from IDA (International Development Association). However, credit-worthy low income countries can receive a “blend” of financial assistance from both IBRD and IDA. Vietnam is entering the category of blend countries, and the Trung Son Hydropower Project is the first investment loan by the Bank to the country under IBRD terms of financing.