CSOs register complaint with World Bank Inspection Panel over proposed Bujagali hydroelectric project

12 April 2007

Ugandan groups highlight risks of project to hydrology of Lake Victoria, sustainability of the energy production, lack of comprehensive needs and options assessment, anticipated impacts on local communities

In the first week of March, the National Association of Professional Environmentalists (NAPE) of Uganda, in collaboration with other local groups, registered a complaint over the proposed Bujagali hydroelectric project with the World Bank Inspection Panel. The Inspection Panel is the Bank’s citizen accountability mechanism that investigates claims of harm resulting from the World Bank’s violation of its own policies.

In their request, the Ugandan groups highlighted a number of concerns including: the risks that the planned 250 MW Bujagali dam would pose to the hydrology of Lake Victoria, where water levels have declined substantially in recent years; the anticipated impacts of climate change-induced drought on hydropower, which may further reduce water levels and jeopardize energy production; the project sponsors’ failure to complete a comprehensive economic analysis that fully addresses alternative energy options; the harmful impacts on local communities, including inadequate compensation and resettlement plans; among others.

While NAPE duly recognizes Uganda’s need for increased power generation, particularly in light of the country’s ongoing energy crisis, it insists that the government should consider other less harmful and more sustainable solutions than the large dam, based on a comprehensive needs and options assessment.

The complaint has fueled the ongoing debate in Uganda surrounding the Bujagali dam - a debate that dates at least from 2002, when NAPE challenged the first iteration of the hydropower project, before its construction was stalled by corruption allegations and the eventual withdrawal of the project sponsor.

Despite the fact that many of the concerns raised in the current complaint have been echoed by academics and officials, NAPE’s appeal to the Inspection Panel has come under intense criticism by the Ugandan media. Last week, The Monitor said NAPE was trying to “undermine [the government’s] efforts to fulfil its pledge of providing adequate electricity to Ugandans,” while other papers have provided almost uniformly uncritical endorsements of the project. Many observers remain skeptical, however, of these papers’ impartiality, as it has been suggested that several media houses in Uganda are owned by the project’s investors.

The current project’s primary sponsor, Industrial Promotion Services (IPS), a unit of the Aga Khan Fund for Economic Development, reportedly released $150 million for the project last week to get work started, in anticipation of a further $600 million in support from various donors.

The World Bank is considering a partial risk guarantee worth $115 million, while both the International Finance Corporation (IFC) and European Investment Bank (EIB) are expected to approve investments in Bujagali worth $100 million and $130 million, respectively, some time in late April or May. The African Development Bank is also considering funding the construction of transmission lines from Bujagali to the tune of $43 million.

Resources

• Activists write to WB over Bujagali by Fredrick Masiga, The Monitor, March 20, 2007 (AllAfrica website)
• Weighing cost of power shortage by Fredrick Masiga, The Monitor, March 13, 2007 (AllAfrica website)
• Bujagali sponsors release Shs270 billion by Elias Biryabarema & Peter Nyanzi, The Monitor, March 29, 2007 (AllAfrica website) 
• National Association of Professional Environmentalists website
• Bujagali project page, International Rivers Network (IRN website)