Economic analysis of the environmental and social impacts of the Nam Theun 2 Hydroelectricity Power Project

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Courtesy of IWA Publishing

The Nam Theun 2 Hydroelectricity Power Project (NT2), located in the Khammouane Province of central Lao's People Democratic Republic (Lao PDR), aims to produce electricity with a generating capacity of 1,070 MW. Most of the electricity generated (995 MW) will be sold to the Electricity Generating Authority of Thailand (EGAT) and the remaining (75 MW) sold to Electricite du Laos (EDL). The primary purpose of the existing analysis is to undertake an economic valuation of the environmental and social impacts of the project, wherever possible. The lack of information pertaining to expected environmental and social changes induced by the project, or the impossibility to conduct original primary data collection may prevent the economic valuation of a number of environmental and social impacts. In such instances, however limited in number, the assessment remains of a qualitative nature. It should however never be concluded that a known impact (positive or negative) entails no benefit or cost when lacking economic quantification. It follows instead that such impacts should be appropriately accounted for by decision-makers and stakeholders in addition to the information provided by the cost-benefit analysis. The author aim to conduct this study and present its results in a manner that is most conducive to a comprehensive understanding and assessment of the various tradeoffs faced across each impacted area of the project.

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