Outline Law as a tool can be used on two differed levels Laws and procedures at national and regional level can be implemented to improve current decisionmaking about the Xayaburi dam and other proposed mainstream dams ID: 788024
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Slide1
Law as a Tool for Cooperation and Sustainable Development of the Mekong River
Slide2Outline
Law as a tool can be used on two differed levelsLaws and procedures at national and regional level can be implemented to improve current decision-making about the Xayaburi dam and other proposed mainstream damsRegional institutional strengthening can improve decision-makingThe presentation will:Assess whether the relevant legal framework under the 1995 Mekong Agreement framework has been implemented adequately in the Xayaburi decision-making process
Assess whether Thai law has been adequate been implemented during the approval of the PPA and outlines the Thai institutions investigating the Xayaburi project
Argues for the need for regional institutional strengthening
to ensure better cooperation for the sustainable development of the Mekong
River
Conclusions and Recommendations for Next Steps
Slide3Legal Frameworks
International Legal Frameworks:International environmental and laws e.g. Ramsar Convention on WetlandsRegional Framework:1995 Mekong AgreementProcedures for Notification, Prior Consultation and Agreement (PNPCA)ADB-GMSASEANNational Frameworks:Lao PDR, Thailand, Cambodia, Vietnam
Slide4The Big Picture: Damming the Meko
Slide5Xayaburi Project in Lao PDR
Country: Location: Xayaburi town, Approximate 80 km south of Luang Prabang, Lao PDRCommercial operation: October 2019 (expected)Construction cost: $3.8 billion Owner(s): Xayaburi Power Company Limited (XPCL)
Dam and Spillways Height: 32.6m Length: 820m
Use of Electricity:
95% of power for export to Thailand
Relocation:
The latest estimate of people to be resettled is 2,130.
Preliminary construction has already commenced
The developer’s consultants Poyry and CNR have not finished studying baseline information, so dam design has not been finalised
The is likely to trigger a cascade of up to 11 dams in Lao PDR
Slide6PNPCA as Current Main L
egal ToolThe PNPCA one of the MRC’s five procedures for countries to jointly review any dam proposed on the mainstream of the Mekong River with an aim to reach a consensus on whether or not it should proceed, and if so, under what conditions. The 1995 Mekong Agreement states that Prior Consultation phase of the PNPCA is not a unilateral right to use water by any riparian without taking into account other riparian's rightsOn 20 September 2010,
started the Xayaburi PNPCA by submitting documents including an Environmental Impact Assessment, a Feasibility Study and a Social Impact Assessment for the project.
Slide7How has the PNPCA been implemented?
MRC Prior Consultation Review Report: “The project review by the MRC Secretariat highlights a number of areas of uncertainty on which further information is needed to address fully the extent of the transboundary impacts and mitigation measures required.” Further, “[the] distribution of the number of affected people among countries would need to be further analyzed based on more extensive social information.” One MRC partner said: "Putting it frankly, the key documentation prepared by consultants for the promoters of this dam has been nowhere near international standards and it reflects very poorly on the consultants involved."
Slide8MRC Joint Committee PNPCA Meeting
At Joint Committee meeting of the MRC held in Vientiane on 19 April 2011, Lao PDR insisted that the PNPCA process was complete, while the other three MRC member states raised concerns on impacts and gaps in technical knowledge and mitigation measures. The Joint Committee members therefore agreed to elevate the issue to the ministerial level and refer it to the MRC Council.
Slide9MRC Council MeetingOn 6 December 2011, water and environment ministers from the four MRC member states who comprise the MRC Council agreed to further study on the sustainable development and management of the Mekong River, including impacts from mainstream hydropower development projects.
It was not however made clear whether the Xayaburi dam could proceed before the study was completed.
Slide10Lao PDR and PNPCA Instead, of addressing the concerns raised in the PNPCA, the Government of Laos commissioned two desk studies outside the MRC framework.
In May 2011, Laos commissioned Swiss company Pöyry Energy AG to evaluate the Xayaburi Dam’s compliance with the dam design requirements set by the Mekong River Commission. Pöyry completed the study in August 2011 and recommended that construction on the dam proceed despite identifying significant gaps in scientific knowledge about the impacts of the dam. The Pöyry report was widely criticized throughout the region for its technical shortcomings, including by WWF and ICEMIn response to this criticism, Laos hired French dam builder Compagnie Nationale du Rhône (CNR) in January 2012 to conduct an independent review of the Pöyry report. In April 2012, the Lao government published the CNR report on its “Powering Progress” website. Like the Pöyry report, the CNR report has neither produced new knowledge on the Xayaburi Dam’s impacts nor has it responded to the concerns raised by the MRC governments in April 2011. The study was limited only to three topics—hydrology, sediment flows, and navigation—and did not fill gaps in baseline data or study transboundary impacts.
Slide11Thailand and PNPCAThe National Energy Policy Council and Thai Cabinet approved:
Power Purchase Agreement (Oct 2011)Krung Thai Bank loan to the project (Nov 2011) Without these approvals, the project could not move forwardAs Thailand will purchase 95% of the power and a Krung Thai state majority owned bank will finance the project, Thailand is equally responsible for the project moving forward
Slide12Has the PNPCA been followed?
The PNPCA has not been followed: Despite Lao PDR’s unilateral assertion that the PNPCA process is complete Lao PDR is obligated to address the concerns and recommendations made in the PNPCA process by Cambodia and Vietnam, and that Lao PDR has not provided adequate answers to these requests. Obligations of Lao PDR and Thailand: As a party to the Vienna Convention on the Law of Treaties, Lao PDR is obligated to act in good faith with other member states. There are no terms in the agreement or in the PNPCA whose ordinary meaning empowers a member to unilaterally declare the PNPCA process complete.
Lao PDR is obligated to return to the table and negotiate in good faith to resolve any disagreements regarding the status of the PNPCA before proceeding with the construction of the Xayaburi Dam project. Thailand should also suspend its approval of the Power Purchase Agreement pending the compilation of answers to the requests for further information by downstream MRC members.
Slide13Following International LawLao PDR has an obligation under international environmental law to conduct a transboundary
EIA when there is a risk of transboundary environmental harmThere is a strong possibility there will be transboundary harm from the projectNo transboundary EIA has been conducted.
Slide14The Role of Thai Law
All administrative decisions must comply with the Constitution of Thailand which requires for affected communities:Environment and Healthy Impact assessmentPublic consultationThe National Energy Policy Council and Thai Cabinet approved:Power Purchase Agreement (Oct 2011)Krung Thai Bank loan to the project (Nov 2011) There has not been an impact assessment of the project inside Thailand
Xayaburi public meetings in Thailand did not provide information about the project or project impacts and therefore cannot be characterised as consultations
Slide15Thai Investigations of the Project
Court case was filed in Administrative Court of Thailand on 7 August 2012 by affected communities from the eight Mekong River provinces of Thailand. The lawsuit argues the agreements are unconstitutional and illegal because they did not involve impact assessment or public consultation with villagers or downstream countries. Villagers hope that without the power purchase agreement, the project will not be able to go ahead.
Slide16Analysis of Xayaburi Dam Decision-Making
The decision-making for Xayaburi has been problematic:PNPCA not fully implementedNo transboundary Environmental Impact Assessment (EIA) conductedPreliminary construction on the project has already commencedRecommendations of the Strategic Environmental Assessment (SEA) report have been ignoredDecision not integrated at national or regional level with other hydropower developmentIf the Xayaburi dam is approved, there are inadequate procedures to govern its construction and operation
Slide17Legal tools not being examined or discussed in impact assessment
There are two studies of the impacts of hydropower development on the Mekong River mainstream currently being discussed. First, the MRC will lead a study of the impacts of hydropower development along the Mekong mainstream. The four MRC member states are currently debating the terms of reference. Second, the Vietnamese National Mekong Committee is leading a study of the impacts of hydropower development on the Mekong Delta.These studies will only examine the impacts of hydropower development and will not analyse the laws and institutions to strengthen decision-making to ensure the future cooperation and sustainable development of the Mekong River.
Legal institutions are a key tool to avoid and minimise negative environmental and social impacts of hydropower development
Slide18Recommendations of Strategic Environmental Assessment
In addition to making findings and recommendations on the environmental and social impacts of the 11 proposed dams, the MRC commissioned SEA Report identified critical shortcomings in national and regional legal and institutional capacities related to the governance of hydropower dams that should be addressed prior to any dam construction on the Mekong mainstream. The shortcomings in legal and institutional capacities are outlines in the next slides.
Slide19SEA Legal Recommendations (1)
No MRC mechanism for basin-wide regulation of development on the Mekong mainstream. Need new regional institutional mechanism be required to plan and manage multi-sector development on the mainstream. Calls for a review of the 1995 Agreement and formulation of additional protocols to determine whether MRC can fulfill this role.
Slide20SEA Legal Recommendations (2)
Need for an independent regulatory authority to set and enforce design, maintenance and operations standards. Original project proposed for Xayaburi dam did not meet MRC Preliminary Design Guidance requirements for safety and fish passagesPoyry/CNR Reports have been very controversial but no one state or body has regulatory powerXayaburi dam only being discussed as individual project but a cascade of dams proposed to be operated by private sector
Slide21SEA Legal Recommendations (3)
Significant improvements in regional cooperation, institutional and regulatory capacity are needed:frameworks setting regional standards and safeguards related to transboundary and downstream effects; institutional arrangements for enforcement; and mainstream project risk management.
Slide22SEA Legal Recommendations (4)
Many gaps in institutional and procedural arrangements to effectively manage dam construction and operation exist at the local level. Need for increased capacity at the national and provincial level for conducting SEA’s, assessing EIAs, SIAs and EMPS, and implementing and enforcing environmental safeguards are necessary.
Slide23SEA Legal Recommendations (5)
Institutional capacity for avoidance and mitigation measures are currently inadequate at national level.Adjustment and support programs for affected communities do not currently existBenefit sharing mechanisms between states and national and local levels must be developed to equitably share costs and benefits
Slide24SEA Legal Recommendations (6)
A Mekong River Basin Management Fund should be created:For mitigation, protection, prevention, basin development, including benefits sharing, research and monitoringRevenue tariffs, contributions from developers, development partners and China and Burma. The MRC might be an appropriate vehicle to administer such a fund. This fund should also have safeguard policies and a review process
Slide25Conclusions
Current legal frameworks have not been fully implementedThai LawPNPCAInternational LawImpacts and institutions not sufficiently linkedThere is a need for regional institutional strengtheningImproving current implementationDiscussion of wider context to ensure framework is effective to ensure cooperation & sustainable development.
Slide26Next Steps
The PNPCA should be fully implemented, which means Lao PDR has an obligation to provide the information that was requested during the Prior Consultation phase by Cambodia, Thailand and Vietnam. Lao PDR should suspend all construction activities at the site, and Thailand should suspend its approval of the Xayaburi Power Purchase Agreement and loan by Krung Thai bank until all information has been provided and discussed among MRC member states.There should be a call by all four MRC member states for a review of the 1995 Agreement and formulation of additional protocols to ensure the objects and purpose of the 1995 Mekong River Agreement can be implemented in practice.
The MRC study on the impacts of hydropower on the Mekong River Mainstream and the study by the Vietnamese Mekong River Committee on the impacts of hydropower in the Mekong Delta
should both include a section in their terms of reference to review the legal tools available to minimise or avoid negative impacts.