21 Feb 2013

Damnation at the Heart of Borneo

Note from David: I've asked a lot of people for more information on dams in Sarawak [prior post], and this guest post offers some expert insight.*

Good practices do not prevent a heart attack, bad practices matter
The Malaysian state of Sarawak, on the island of Borneo is on the verge of change. At the very base of this change is a debate on how Sarawak’s future economic development is relying on the construction of 12 large hydropower dams, that are either to jump-start coastal Sarawak into an industrial development spree [1,2], or to convert Sarawak into a battery for the region (perhaps extending to China or Australia) [3,4], as part of the Sarawak Corridor of Renewable Energy (SCORE), a pet project of Abdul Taib Mahmud, Sarawak’s Chief Minister of 30 years, state Financial Minister, and Resource Planning and Environment Minister [5].

Dam developments like these cannot only be considered in isolation, there is a networked global hydropower industry at work, which has been in a slump since the late 1980s; see e.g. this video. That is when broader opposition against societal and environmental impact of large dams took hold. But now the industry is re-consolidating and finding new traction in emerging countries, which have lead to range of settings where very similar discussions are currently going on (e.g., the Amazon, Congo, Nile, Mekong, or Brahmaputra river basins). Many of the international hydropower companies and international organizations are represented in the International Hydropower Association (IHA) [6]. In 2010, Sarawak’s energy company, SEB, joined the IHA, and in May 2013, it will host an international congress on advancing sustainable hydropower [7].

Hydropower or death?
Like in many emerging states, the hydropower development debate is highly polarized, with little room for maneuver and concession from both sides of the divide, and little constructive discussion going on in the middle of this polarization. On one side there is the development narrative that projects hydro-electricity as the engine to either support a country’s industrial development or as a commodity to be sold to neighboring countries. The other development narrative takes a look at the social and environmental impacts that dams have, and concludes that not many large hydropower projects have lead to direct benefits to local people who often have to be resettled and see their economic and natural resources diminished to the point that they end up in poverty.

On the pro-dam development side in Sarawak is Taib, his family, his associated ministries, companies, and cronies. Among other important sectors in Sarawak, the broader Taib network pretty much controls [8]:
  • the entire supply chain of timber, including licensing and transportation
  • palm oil plantations that are set up and licensed after a land has been cleared
  • mining enterprises such a coal and aluminum
  • hydropower development
  • cement (the family business has a state-wide monopoly)
  • state companies and state contracts, and access to international corporations
  • political party in office 
  • state media
Taib Mahmud and his SCORE-plans are under constant criticism for nepotism, cronyism, and corruption [10,11]. For example, how Hamed Sepawi, the chairman of Sarawak Energy Berhad (SEB), the company that is in charge of planning and operating the hydropower dams, also happens to be a cousin of Taib [9]. Another remarkable example of how polarized the debate has become dates from April 2012. At that time the Norwegian CEO of SEB, Torstein Dale Sjøtveit, came under fire at SEB at the same time he also received a prestigious industry award in Singapore [9,12]. All this provides a relevant context for questioning the justification of these 12 dams.

On the other side of the dam debate is an international coalition of different NGOs (Save Sarawak’s Rivers) [13], that is against the building of dams, and whistleblower website SarawakReport.org, which seems to be just pro-transparency, anti-corruption in Sarawak, thus against Taib and his dam-building aspirations [DZ: This appears to be the Indonesian equivalent]. Sarawak Report has uncovered many issues concerning the ongoing corruption around dam planning in Sarawak. Its reports and accusations seem to have their effects; in August 2011 it uncovered a $5 million plot where Taib (indirectly) paid a British PR company to start a campaign against Sarawak Report; it included setting up a website called Sarawak Reports, and creating positive and negative exposure on international broadcasting networks (like BBC World, CNN, CNBC) and included a journalist of the Guardian (who lost his job over this conflict of interest) [22,23].

The real losers
Apart from the corruption, the main concern against the dams is the socio-economical and environmental destruction that are generally associated with dam construction [14 DZ: See this article]; the dams are intruding into the Heart of Borneo; a place renowned for its rich and extraordinary cultural and biological diversity. Moreover, unique peatland swamps and coastal mangroves exist downstream on a very fragile hydrological and sediment balance, a balance that might be disturbed by the construction and operation of large dams in the upstream.

Before the construction of logging roads, the rivers were the only arteries supporting transportation and human settlement on the island of Borneo; and to the largest part of the inland population, they still are. A 2008 study by UNDP and the state government on transportation on inland waterways acknowledges that hydropower dams in the upstream would help to mitigate transportation problems due to seasonal droughts; it would even facilitate the transportation of bulk goods like timber and coal [32], but fails to recognize the logistic challenge if such a 100 m high concrete wall gets built between you and your destination.

All this while reports on violations of human/indigenous rights have been linked to the current rate of dam development in Sarawak. There are reports that to-be-resettled communities find their resettlement areas completely deforested and to-be-planted under palm oil [15]. Or about the lack in transparency and feedback mechanisms in environmental impact assessments surrounding the Murum dam, which is still under construction [16]. October 2012 saw a weeks-long road blockade disconnecting the Murum construction site by the indigenous Penans. Reuters (December 2012 [17]) reports of 40 lorries an hour shipping off timber from what is to become Murum’s reservoir, a complete lack of transparency surrounds this clear-cutting of 245 square kilometers of pristine forest. Though it would be a waste to leave the forest standing and rotting in the reservoir, it is very likely that someone closely related to Taib is running the logistics and getting the profits, and little of it remains with the people that originally lived there and have been resettled. And it can be assumed that this all forms part of the broader hydropower benefits package that goes to a few people; e.g. for Bakun dam, timber businessman without any experience in hydropower advanced $500 million to finance the dam in 1994 [34].

Around Bakun dam, there are reports that resettled people have trouble in paying for their electricity bills, and have their electricity cut off (!); though there are also unbiased reports of resettled people who find their situation much improved [17]. The Bakun dam was sort of exceptional in financial terms, in 2005 Transparency International credited the dam as a “Monument of Corruption” [18]. The dam was started in the early 1990s, stopped due to the decision to first exploit low-cost gas reserves, then due to the financial crisis [34], only to be finalized last year (2012). All with a lot of trouble, e.g. Sinohydro (Chinese state company) admitting that there were structural mistakes made under pressure during construction [19]. It must be quite scary to have such a massive and -somewhat- instable critter in the upstream in one of the world's wettest climates, with up to 4 meters of annual rainfall.

Drought or man-made shortage?
There are also the reports about the extreme 2010 and 2011 droughts in Sarawak’s largest Rajang river that were, according to some government outlets, the result of climate variability or climate change, though some independent media outlets observed that this drought completely coincided with the filling of the Bakun reservoir [20,30,31]. During the 2011 drought, someone estimated that the filling of the reservoir would take about two years of full river flow; i.e. in the unlikely –antisocial and anti-environmental- event that the dam would store every drop and not leave any water in the downstream river to support its people and nature. Such a scenario would be of direct benefit to the dam operator because it is the fastest way to start with electricity generation. But quite exceptional, given the climate-change-induced droughts of the last two years, there is a recent report from the dam operator that after just over two years of filling, the reservoir is at its operational level [21]. If the issues at stake wouldn't be so serious, they could at least be ridiculously funny.

International partners and domestic politicians with cold feet
The dam development trajectory is slowly-but surely starting to show some cracks; in March 2012 Rio Tinto cancelled to built its aluminum smelter in Sarawak; that smelter was to take about 900-1200 MW of the 2400 MW generated by the Bakun dam, and provided the backbone for its justification. Different perceptions exist on the reason behind this pull out, ranging from issues about energy prices, to global recession, to media pressure on the corruption behind Bakun dam [24].

In similar fashion, in December 2012 Hydro Tasmania has pulled out from its support to SEB and the broader hydropower planning in Sarawak. Hydro Tasmania had strategically downplayed its role in the Sarawak hydropower context, especially when they came under pressure from campaigners [28] and the Australian media for their support and doing business in such a controversial setup [25].

In the run-up to Malaysia’s 2013 elections, another setback happened early February 2013 when Taib-crony James Masing admitted that there is no real requirement to built those 12 dams, and maybe only keep it at 3 or 4 dams. Masing is the state’s Land Development Minister and probably made these comments in anticipation of the national elections, which are to be held before July 2013. Only, after a few hours Masing was forced to publically retract his earlier statements, blaming the journalist. Read all about it on Sarawak Report [26]. Related to these elections; the main national opposition candidate, Anwar Ibrahim, has promised to cancel plans for the construction of the Baram dam, if he gets elected into office [27].

Should the IHA cancel its conference in Sarawak?
At the moment, the Bruno Manser Fonds [29] (a Swiss NGO, part of Save Sarawak’s River coalition) is encouraging the International Hydropower Association to cancel its May 2013 Sarawak conference on sustainable hydropower [7], warning for the danger that the conference will be used by SEB to greenwash its dam building aspirations.

As a hydropower industry platform, it is very unlikely that conference will speak against  SCORE's plans to continue building 12 dams, some sources even quote more than 50 profitable hydropower projects have been identified [33], and it might be very well used as a networking opportunity by SEB to facilitate its plans. But as a platform supporting the principles of transparency and sustainability, it includes a range of non-industry international organizations; it might therefore also be in the line of expectations that this would be the best occasion to internationally expose and discuss SEB’s track record on sustainability and transparency.

The overall goal of the conference is to share good practices on “sustainable solutions for clean energy, responsible freshwater management, and climate change” [6]. It is therefore very unlikely that too many Sarawak-based good practices will be presented (since there aren't that many), but the question remains whether the platform is willing to raise, discuss, and learn from bad practices as well? If not, the IHA’s own reputation could be at stake.

1 www.sarawak.gov.my/uploads/assets/files/ePub/DevelopmentSynergy.pdf
2 www.british-hydro.org/Presentations/BHA%20Annual%20Conference%202010/Denis%20Lee%20Hau%20Aik.pdf
3 www.bmf.ch/files/news/Sarawak_Energy_Confidential.pdf
4 www.bakundam.com/newsarchive099a.html
5 en.wikipedia.org/wiki/Abdul_Taib_Mahmud
6 www.hydropower.org/
7 ihacongress.org/
8 www.sarawakreport.org/2011/04/taibs-ten-income-streams/
9 www.stop-corruption-dams.org/campaign_update/?show=20
10 aliran.com/6588.html
11 www.sarawakreport.org/tag/taib-mahmud/
12 www.theborneopost.com/2012/04/20/sarawak-energy-ceo-wins-prestigious-award/
13 www.bmf.ch/en/news/?show=288
14 www.internationalrivers.org/
15 aliran.com/3290.html
16 www.suhakam.org.my/c/document_library/get_file?p_l_id=30217&folderId=30507&name=DLFE-5417.pdf
17 Yee Keong Choy, 2004, Sustainable Development and the Social and Cultural Impact of a Dam-Induced Develoment Strategy – the Bakun Experience, Pacific Affairs: Volume 77, No.1-Spring 2004
18 www.thejakartaglobe.com/international/malaysias-bakun-dam-slammed-as-disaster/475840
19 asian-power.com/project/news/sinohydro-admits-flaws-in-bakun-dam-construction-procedures
20 www.theborneopost.com/2011/09/09/kapit-drought-a-yearly-phenomenon-says-minister/
21 www.theborneopost.com/2012/03/12/bakuns-reservoir-now-as-big-as-singapore/
22 www.sarawakreport.org/2011/08/taib-paid-out-5-million-to-attack-sarawak-report-international-expose/
23 www.sarawakreport.org/2012/08/malaysias-poison-blogger-exposed-in-the-us/
24 biz.thestar.com.my/news/story.asp?file=/2012/3/28/business/11000192&sec=business
25 www.sarawakreport.org/2012/12/pulling-out-hydro-tasmania-is-to-quit-sarawak-exclusive/
26 www.sarawakreport.org/2013/02/slapped-down-by-taib-i-didnt-mean-that-masing-grovels/
27 news.mongabay.com/2013/0114-hance-baram-dam-anwar.html#
28 www.savesarawakrivers.com/
29 www.bmf.ch/en/news/?show=339
30 anilnetto.com/governance/accountability/a-most-peculiar-drought-in-sarawak/
31 thestar.com.my/news/story.asp?sec=nation&file=/2011/8/30/nation/20110830141911
32 UNDP-Malaysia, 2008, Malaysia Inland Waterway Transport System in Sarawak
33 www.bmf.ch/en/news/?show=335
34 en.wikipedia.org/wiki/Bakun_Dam

HTs to ML and BS

* For academic perspectives, read Koh et al. [pdf] on the impacts of palm oil cultivation on biodiversity and Fisher et al. [pdf] on the high opportunity cost of retaining that biodiversity instead of replacing rainforest with palm oil.

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