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The Hydropower Solution in Central Asia: yes but"

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Message James Stafford

Surfing the wave of the hype for renewable energy such as hydropower and the invitation by the United States to many regional countries to get involved in the efforts to stabilize Afghanistan, Tajikistan is bringing back to the table the Rogun hydropower dam project. Rogun, conceived in Soviet days, was planned to generate 3,600 megawatts, but the collapse of the Soviet Union halted the completion of this project. Now an independent country, Tajikistan, one of the poorest in the world, sees Rogun as a central element for its energy independence and a source of severely needed foreign currencies that could be earned through the export of electricity.

That effort comes at a time when clean energy is seen as the panacea to reduce the world's dependency on polluting fossil energy, just like using olive oil was once seen as a solution to reduce cardio-vascular diseases. The push for clean energy is laudable but an expensive undertaking. Its implementation remains sketchy in poor countries where the lack of long-term political, economical and social visibility is a deterrent for foreign governments, companies, multilateral institutions and venture capitalists from making long-term costly investments. The "let's all hold hands and save the environment" speech quickly dies when the practicality of such projects are plugged into the picture.

This is unfortunate as the repeated calls for clean energy from industrialized countries create high expectation from poor countries that hope what they have to offer will be seriously considered. For Tajikistan the situation has been quite desperate. The country is plagued with regular energy shortages, unrealistic expectations and unmet promises. The hydropower potential of Tajikistan, about 300 billion kilowatt-hours, remains mostly untapped with only 5% of its potential being used. Once completed, the dam would be one of the tallest in the world at 335 meters and would be 1,500 meters wide. The reservoir would have a total storage volume of 13.5 million cubic meters over 10.3 km3. It is estimated that it would take seven to twelve years for the VakheshRiver to fill the reservoir. The project would force the resettlement of over 30,000 people.

Energy Shortages

Unlike Kazakhstan, Turkmenistan and Uzbekistan, Tajikistan has no known significant oil & gas reserves and as a result energy shortages cripple Tajikistan and regularly bring its manufacturing industry to a halt, not to mention the regular electricity shortages endured by the population, even in the capital city of Dushanbe. The situation is further exacerbated by tensions with neighboring Uzbekistan that cuts the energy supply to retaliate against any efforts by upstream countries to control water flows that might impact Uzbek downstream agricultural activities. The withdrawal in 2009 of Uzbekistan from the Central Asian electricity grid is a further blow as it will also prevent Tajikistan from exporting electricity generated by its hydropower plants. The country is also crippled by legacies of the past, notably the Talco Aluminum Plant (formerly "TadAZ"), which by itself consumes 40% of Tajikistan's electricity production and is said to pay its electricity at heavily discounted prices.

Tired of waiting on foreigners to act and on foreign governments and multilateral institutions that advocate smaller scale hydropower projects, President Emomali Rahmon launched a voluntary-compulsory share purchase program where he asked "every son of the nation, every patriot and our countrymen abroad to support Tajikistan through financial and moral help by acquiring share in the Rogun Hydropower Project. Five million shares and certificates have been issued for a total sum of six billion somonis (about $1.3 billion), which is the Tajik estimated cost to finish the project. Each family was asked (many will argue forced) to buy at least 3,000 somonis (about $690). This is very tolling for a population where the majority lives with less than $2/day, though the poorest families were exempted.

The idea of popular participation is interesting but questionable when not participating in this national effort is considered unpatriotic, and the zeal of some led to some doubtful collecting practices. By the end of January about 701 million somonis ($162 million) had been collected, and by March 10 that number painstakingly reached 770 million somonis ($176 million).

Unrealistic Expectations & Unmet Promised

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I have an interest in the financial markets, commodities and Geopolitics.
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