Final Report
“Improving Hydropower Project Decision Making Processes in Mekong Basin:
Case Studies of Lower Sesan 2 and
Kamchay Hydropower Projects, Cambodia”
Royal University of Phnom Penh (RUPP)
Department of Environmental Science1
December 2013
1
Ham Kimkong ( Senior researcher/ lecturer and project team leader), Hay Samchan, Sok Thea (Associate
Researcher), Sim Vichet, Lor Rasmey (Researchers)
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TABLE OF CONTENTS
TABLE OF CONTENTS ................................................................................................................................2
LIST OF FIGURES .......................................................................................................................................4
LIST OF TABLES .........................................................................................................................................4
LIST OF ABBREVIATION ............................................................................................................................5
ACKNOWLEDGEMENT ..............................................................................................................................7
RESEARCH KEY FINDINGS .........................................................................................................................8
Chapter 1: Introduction ...................................................................................................................... 11
1.1. Cambodia’s Development and Energy Challenges....................................................... 11
1.2. Problem Statement............................................................................................................. 13
1.3. Objectives ............................................................................................................................ 14
1.4. Research Questions........................................................................................................... 15
Chapter 2: Methodologies ................................................................................................................. 16
2.1. Site Selection ...................................................................................................................... 16
2.2. Research Method ............................................................................................................... 16
2.3. Theoretical Framework ...................................................................................................... 17
Chapter 3: Overview of Hydropower Development ....................................................................... 20
3.1. Global and Regional Hydropower Development ........................................................... 20
3.2. Hydropower Potentials and Plan in Cambodia .............................................................. 21
3.3. Justification of Hydropower Dam Development in Cambodia ..................................... 23
3.4. Problems Caused by Hydropower Development in Cambodia ................................... 25
Chapter 4: Decision Making in Hydropower Development .......................................................... 27
4.1. Investment Process in Cambodia .................................................................................... 27
4.2. Main Existing Regulation Concerning Hydropower Project in Cambodia .................. 29
4.3. Hydropower Investment Process ..................................................................................... 31
4.4. EIA Approval Process in Cambodia ................................................................................ 34
4.5. Key Institutions Involve in Hydropower Decision Making ............................................. 37
4.6. Civil Society on Hydropower ............................................................................................. 43
4.6.1. Role of NGOs on Hydropower Development ......................................................... 43
4.6.2. Influence of Civil Societies on Hydropower Development.................................... 45
4.7. Resettlement Policies Change ......................................................................................... 45
Chapter 5: Case Studies ................................................................................................................... 47
5.1. The Lower Sesan 2 Hydropower Project ........................................................................ 47
5.1.2. Predicted Impacts of LS2 Dam ..................................................................................... 48
5.1.3. Lower Sesan 2 Dam Decision-Making Process......................................................... 49
5.1.4. Stakeholder’s Participations.......................................................................................... 51
5.1.5. Compensation and Resettlement Mechanism and Policy ........................................ 52
5.1.6. Compensation and Resettlement Mechanism ........................................................... 53
5.1.7. Cultural and Spiritual Impacts ....................................................................................... 54
5.1.8. Shift in Political Support ................................................................................................. 56
5.2. Kamchay Hydropower........................................................................................................ 58
5.2.1. Background of Kamchay Hydropower ......................................................................... 58
5.2.2. Project’s Purpose............................................................................................................ 59
5.2.3. Kamchay Dam Decision Making Process ................................................................... 60
5.2.4. Stakeholder’s Participations.......................................................................................... 61
5.2.5. Impact after Construction of Kamchay Dam............................................................... 62
5.2.6. Design Issues of Kamchay Hydropower Dam ........................................................... 65
5.2.7. Financial Flows of Kamchay Hydropower Dam ......................................................... 66
5.2.8. Livelihood Reconstitution .............................................................................................. 67
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Chapter 7: Conclusion ....................................................................................................................... 68
Bibliography ......................................................................................................................................... 70
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LIST OF FIGURES
Figure 1: The Use of Impact Assessment to Understand Drivers and Enablers ...................... 18
Figure 2: General Application Process of Qualified Investment Project (QIP).......................... 27
Figure 3: Investment Process of Hydropower Project .................................................................. 33
Figure 4: EIA Approval Process in Cambodia................................................................................ 35
Figure 5: Analysis on Gaps Concerning Cooperation between Government and NGOs .......... 45
Figure 6: Map of Lower Sesan 2 Hydropower Dam in Stung Treng Province .......................... 47
Figure 7: Process of LS2 Hydropower Decision Making .............................................................. 50
Figure 8: Structure of LS2 Dam’s Compensation/Resettlement Committee ............................. 54
Figure 9: Location of Kamchay Hydropower .................................................................................. 58
Figure 10: Kamchay Hydropower Decision Making Process....................................................... 60
Figure 11: Electricity Distribution and Financial Flow of Kamchay Hydropower Dam ............. 67
LIST OF TABLES
Table 1: Selected Study Areas and Number of Samples ............................................................. 16
Table 2: Number of Field Observation Activities in Kampot and Stung Treng Provinces ....... 16
Table 3: Key Informants Met ............................................................................................................. 17
Table 4: Existing, under Construction, and Planned Dam in LMB .............................................. 21
Table 5: Commission Plan of Hydropower/Coal-Fire Stations by the Government from 20092013 ...................................................................................................................................................... 21
Table 6: Current Hydropower Dams under Construction and Development in Cambodia ..... 23
Table 7: Predicted Impacts of Lower Sesan 2 Dam ...................................................................... 26
Table 8: Law and Regulations Relevant to Hydropower Development Cambodia .................. 29
Table 9: Roles of Local Authorities .................................................................................................. 41
Table 10: Roles of Provincial Departments .................................................................................... 41
Table 11: The Promised Benefits from Lower Sesan 2 Hydropower Dam ................................ 48
Table 12: Timeline of Political Seats in the National Assembly .................................................. 56
Table 13: Commune/Sangkat Council Election Result in LS2 Dam Reservoir ......................... 57
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LIST OF ABBREVIATION
3SPN
ASEAN
ADB
ANZ
BOO
BOOT
BOT
CDC
CDRI
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CENTDOR
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CEPA
CI
CIB
CPP
CRC
CIDA
CNMC
CNRP
COM
CSO
CSR
EAC
EDC
EMP
ESIA
EVN
FACT
FDI
FFI
FGD
FRC
FS
FUNCINPEC
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GMS
GDP
HECEC
HP
IA
ICEM
IRC
IUCN
JICA
KCC
KHR
kWh
LMB
LMR
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3S River Protection Network
Association of Southeast Asian Nations
Asian Development Bank
Australia and New Zealand Banking Group Limited
Build-Own-Operate
Build-Own-Operate-Transfer
Build-Operate-Transfer
Council for Development of Cambodia
Cambodia's Leading Independent Development Policy Research
Institute
Center for Development Oriented Research in Agriculture and
Livelihood Systems
Culture and Environment Preservation Association
Conservation International
Cambodia Investment Board
Cambodian’s People Party
Conditional Registration Certificate
Canadian International Development Agency
Cambodian National Mekong Committee
Cambodian National Rescue Party
Council of Ministers
Civil Society Organization
Corporate Social Responsibility
Electricity Authority of Cambodia
Electricite du Cambodge
Environmental Management Plan
Environmental and Social Impact Assessment
Electricity of Viet Nam
Fisheries Action Coalition Team
Foreign Direct Investment
Fauna and Flora International
Focus Group Discussion
Final Registration Certificate
Feasibility Study
National United Front for an Independent, Neutral, Peaceful, and
Cooperative Cambodia
Great Mekong Subregion
Gross Domestic Product
Hydroelectric Commission Enterprises Corporation
Hydropower
Implementation Agreement
International Center for Environmental Management
Inter-Ministerial Resettlement Committee
International Union for Conservation of Nature
Japan International Cooperation Agency
Key Consultant Cambodia
Khmer Riel
Kilowatts per hour
Lower Mekong Basin
Lower Mekong River
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LNC
LS2
MEF
MIME
MLMUPC
MPWT
MOE
MOU
MOWRAM
MRC
MW
NA
NEC
NGO
NIS
NSDP
PAM
PE
PO
PPA
PDOA
PDOE
PDOIME
PDOWRAM
PECC1
QIP
RCC
RGC
SAWAC
SRP
TVK
USD
UNTAC
WEF
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Letter of Non-Compliance
Lower Sesan 2
Ministry of Economic and Finance
Ministry of Industry, Mines and Energy
Ministry of Land Management, Urban Planning and Construction
Ministry of Public Works and Transport
Ministry of Environment
Memorandum of Understanding
Ministry of Water Resources and Meteorology
Mekong River Commission
Megawatts
National Assembly
National Election Committee
Non-Governmental Organization
National Institute of Statistics
National Strategic Development Plan
Project Approval Ministry
Political Ecology
Project Owner
Power Purchasing Agreement
Provincial Department of Agriculture
Provincial Department of Environment
Provincial Department of Industry, Mines and Energy
Provincial Department of Water Resources and Meteorology
Power Engineering Consulting Joint Stock Company 1
Qualified Investment Project
River Coalition of Cambodia
Royal Government of Cambodia
SAWAC Consultants for Development
Sam Rainsy Party
Television of Kampuchea
United States Dollar
United Nations Transitional Authority in Cambodia
World Economic Forum
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ACKNOWLEDGEMENT
On behalf of project’s researcher team members of Royal University of Phnom Penh,
Department of Environmental Science, would like to sincerely thank to Dr. Kim Geheb,
CPFW’s Mekong Basin Leader, Dr. Nathanial Matthews CPWF’s MK8 regional project
coordinator for their research guidance, technical advices and encouragement to our
Cambodia’s research team. Indebtedness, authors would like to express ours sincerely
gratitude to the CGIAR/Challenge Program on Water and Food (CPWF) for financial support
to this research project, without this grant the study would not be possible to produce book
chapter and project report. Very gratitude and thank to Dr. Pech Sokhem, Dr. Sam Nouv for
their valuable technical advises and assistances to research team.
The special thanks to all concerned provincial and local government officers at both Kampot
and Stung Treng provinces, colleagues and students of Department of Environmental
Sciences, Royal University of Phnom Penh for their kind supports and cooperation in
providing information and respondents. Sincere gratitude is to people and communities for
responding to all research questions and extended their warm hospitality and kind
cooperation. Last, but not least; extremely grateful to all friends for their patience and moral
support throughout the period of this research.
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Executive Summary
 The energy shortage is seen as a challenge against the continuing effort of the
government in Cambodia’s reconstruction and socio-economic development.
Cambodia has been focusing on its hydropower potentials to solve this challenge as
well as to sustain energy sector in the future. As this hydropower development has
been gradually increasing, there has been lots of social and environmental issues
emerge from this development. Concerns have been raised over how efficient is the
decision making of hydropower development in Cambodia. There are certain
literatures showing the limitation of hydropower decision making in Cambodia which,
as a result, fail to guarantee equal benefit and the interest of the weakest segments
of society. This report is prepared in an attempt to bring to light hydropower decision
making processes in Cambodia which is the topic of hot debate both in Cambodia as
well in the region. To understand the hydropower decision making, this study lays out
3 main objectives: 1) to identify key drivers that influence hydropower development;
2) to understand EIAs and SIAs influence on HP decision-making; and 3) to identify
‘power in relation’ in HP decision-making in Cambodia.
 The study focuses on two case studies including Lower Sesan 2 (LS2) hydropower
project in Stung Treng province and Kamchay hydropower project in Kampot
province, starting with the review and analysis of related documents including
regulation, plan and policy and the previous literatures. Field observations were
organized at both target areas to see the actual target study sites, to introduce the
project to stakeholders, and to build network with all key stakeholders and partners at
provincial levels. In total, 106 households in Stung Treng province were interviewed,
114 persons were met and discussed during the field observation phase, and 44 Key
Informants were interviewed in the 2 targets areas. To understand the phenomenon
hydropower decision making process in Cambodia, the Political Ecology (PE) is used
to analyse the data and information to check the power relations between different
multiple layers at local, district, provincial, national, and regional level, and look at
how decisions are made regarding to hydropower development in Cambodia. This
research uses Environmental Impact Assessment process of hydropower projects as
a lens so that information of interaction among all stakeholders can be accessed for
analysis.
RESEARCH KEY FINDINGS

With considerable high economic growth during the last decade and along with the
country’s intension to move into upper-middle income country by 2030, Cambodia is
in need of energy, especially the electricity. The demand of electricity was also
pressured when the main economic activities is moving from traditional agriculture to
ward industry and service sectors. The energy challenges in Cambodia includes low
electricity supply capacity, high electricity cost, limited rural electrification, and
continued dependency on imported fuel oil and on electricity import from
neighbouring countries. This electricity issues is highlighted as a major disincentive to
potential investors, which is eventually the barrier to the effort of economic
development in Cambodia. As forecasted, the demand of electricity is also on the
trend of big surge and, even some effort to control the demand site, the government
needs to increase the country’s generating capacity of 20% to stabilize this electricity
sector. Even though electricity export have not been loudly spoken by the
government, it is apparent that the government still has the intension to export energy
to neighboring country if we consider the intension to build huge dams on Mekong
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River’s mainstream, as well as the hydropower locations which placed to be easily
accessed by cross-country power grids such in the areas near national border.
Until the fourth legislation of the government of Cambodia, certain small and largescale hydropower dams as well as thermal coal power plant have been developed
and put under operation. According to the National Sector Review of Hydropower
done by Ministry of Industry, Mine and Energy in 2003, the government has been
focusing on around 60 possible hydropower sites including 14 priority projects, which
could produce power capacity varying from 1,900 MW to 4,700 MW according to the
scale of Sambor Hydro which will be built on Mekong Mainstream. Up to now, there
are four hydropower development projects under construction including Lower Russei
Chhrum, Atay, Tatay and Lower Sesan 2 hydropower, while at least 12 others are
under the MOU of feasibility studies.
The selection of hydropower as a corner stone of energy policy of Cambodia was
partly pushed by the availability of country’s resources as well as the global and
regional trend toward renewable energy, for example, the 15% of renewable energy
in the total installed power capacity by 2015 set by ASEAN. The selection of
hydropower, especially the large scale one, is also encouraged by the belief that
large scale is more efficient and the availability of financial resource and the investor.
Royal government of Cambodia (RGC); acknowledges the need to consider social
and environmental impacts caused by hydropower dams, meanwhile raises that the
tributary hydropower dams would cause less negative impacts than the mainstream
ones, and this is why, Cambodia started building dam on tributaries to meet the
electricity demand, while dam on mainstream can be considered after 2030.
Moreover, the government is seen to focus more on macro perspective, rather than
micro perspective when talking about cost and benefit of dam which leads to the
scarifying of certain resources to get the electricity. While complaints are raised by
civil societies, the government claims that efforts were done to get the win-win
situation.
The actual negative impacts especially on society, even though strongly concerned
by civil society, was not huge so far, because until now, the dams under operation are
not large in scale and most of them were built in highland and mountainous areas
outside Mekong Basin, where resettlement is not big issues, and some time the
downstream villagers did not strongly depend on the water such as the case of
Kamchay dam. However, the people in the northeastern part of the country like
Ratanakiri and Stung Treng provinces have been seriously suffered from the transboundary impacts caused by dams built in the upper part of Sesan River especially
the Yali Fall dam in Viet Nam territory. Adding to the existing trans-boundary impact,
the people living in the 3S areas are worrying about the possible negative impacts
caused by the planned Lower Sesan 2 (LS2) dam in Stung Treng province. Certain
studies show that if LS2 is to be built as planned, where will be certain issues such as
relocation of affected people, decreased fish stock, hydrological changes and the
impact on the Tonle Sap Lake, blocking of fish migration and sediment flows. There
are mounting concerns from civil societies over the impacts and the issues of public
participation, the quality of EIA, as well as the hydropower planning and design,
which are seen as topics of intensive argument between the government and civil
societies. Moreover, the information regarding the condition and process of
hydropower investment are very limited to public access, which causes the suspicion
especially among civil societies over the transparency and the benefit sharing of the
project.
Until now, Cambodia does not has direct law on hydropower development, but
relevant articles within other laws have been used. While EIA law is in its drafting
process, the Sub-decree of EIA established in 1999 is used instead. The
implementation of EIA was also seen to be under criticism when development
projects are considered more important compared than the need to study its
environmental and social impacts. There are certain facts behind this argument like
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small proportion of running investment projects with EIA, late EIA study, capacity and
resources of EIA department of MoE, as well as the interaction with related
institutions, especially with the project’s leading ministry. Quality of EIA report,
according to the percept of interviewed civil societies, is low because of limited
participation. However, there are also progresses during which civil societies are
selectively allowed to participate in the consultative processes.
Civil society was seen to play active role in the issues of hydropower development.
The majority of affected people who turn to depend civil society organizations said
that they has less trust on the government existing system to help them to solve their
problem, so they turn to medias, civil society organizations and even opposition party.
The case of the change of political support from the ruling party to the opposition
party during the 2012 commune/Sangkat election is a message that the government
needs to improve the consideration and communication with the affected people to
make sure that people’s demands are heard and problems are considered and
solved. As noticed by civil societies, the government has been improving, even
though not significantly, the condition of compensation and resettlement, which can
be understood as an attempt satisfy the affected people.
From the 2 case studies, the study also found that benefit sharing is still a challenge
that the government need to seriously consider both during the impact assessment
phase and the implementation of all promised mitigation measures as well as the
livelihood restoration programs. Kamchay case, even though most people do not feel
any sever impact, local people, especially those who are living close to the dam are
not happy when their local resources are used to supply only those who are mile
away from the dam. Moreover, the implementation of the promised livelihood
supporting programs is unclear even though dam was put under operation for years.
The case of Kamchay will be lesson learnt to the government to make sure that the
other dam development, especially LS2 dam will not fall into this situation that the
effect will be much bigger than Kamchay am. Deeper study over the impact must be
considered and included. This includes direct and indirect impact on both upstream
and downstream villages. Moreover, the cultural and spiritual assets of the local
people must be considered seriously to maintain the way of life of the people which is
generally seen as a movement toward sustainable development.
Finally, it is also worth notice that until recently almost all of the approved and
commissioned hydropower development projects in Cambodia are technically and
financially supported by foreign donor or private investment companies. But recently,
there is a turning point where local private investors have a space in the investment
of large scale hydropower project LS2 in the form of joint venture with foreign
investors. Cambodia needs foreign investors because Cambodia has limited
resources in such development. In the case of LS2 dam, it is also noted that there is
a change of hydropower investor from Viet Nam to China which is playing significant
role in hydropower as well as other infrastructure development in Cambodia. Even
though the change of investor’s shares in the case of LS2 is claimed to be because of
the financial problem of Viet Nam side, the move toward China is seen to be in
parallel with the current strong economic and political ties between the two countries.
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Chapter 1: Introduction
1.1. Cambodia’s Development and Energy Challenges
After Khmer Rouge regime, the 1980s was occupied by Planned Economy. The 1991 Paris
Peace was the main foundation setting Cambodia on a new path toward free market and
democracy with the Constitution and the firstly elected Royal Government of Cambodia
(RGC) in 1993 (RGC, 2006). Since then, aid agencies and international organizations started
to pour in and bring significant contribution to the reconstruction of the countries (JICA,
2002), and Cambodia has struggled to transform itself from planned economy to free-market
economy and encourage investment, trade and private sector development within the Great
Mekong Sub-region (GMS), the regional of Association of Southeast Asian Nations (ASEAN)
and East Asian as well as global context (CDRI, 2012).
Cambodia’s economic today is significantly supported by a mixture of agriculture, industry
and service. Four sectors that remarkably contributed to the growth were garments and
footwear, hotel and restaurant, construction, and agriculture. In 2010, agriculture shared 27.4
percent of the GDP, industry 26.4 percent and the services 40.6 percent (CDRI, 2012).The
economy experienced remarkable growth with the average annual increase of 7.8 percent
between 1994 and 2010, which brought the people with the increase of per capita income
from USD 240 to USD 735 respectively. Foreign Direct Investment (FDI) in the second half of
the 2000s increased to USD 604 million, and in aggregate from 1993 to 2010, FDI reached
USD 5.58 billion which accounts for 34 percent of the total private investment in Cambodia
(CDRI, 2012).The rate of people living below the overall poverty line has been reduced more
than one percent annually down from 34.7 percent in 2004 to 30.1 percent in 2007 (RGC,
2009). Cambodia today is in transition from the low income to lower middle-income country
(USD 1025 - USD 4035) (CDRI, 2013), the status identified by World Bank. With the
country’s per capita GDP in 2012 of USD 970, and the expected annual increase of over 7
percent, the Prime Minister of Cambodia expressed his vision that Cambodia will move into
upper-middle income country by 20302.
Along with development prosperity, Cambodia has been facing many challenges which need
to be solved to sustain economic development. Energy issue is seen as one of the
challenges against the government’s efforts in reconstruction and socio-economic
development of the country (MIME, 2003). The energy issue includes low electricity supply
capacity, high electricity cost, limited rural electrification, and continued dependency on
imported fuel oil. In 2009, the electricity generation capacity in Cambodia reached 372
megawatts (MW) but heavily depended on imported diesel and heavy fuel oil up to 91.4%
compared to other energy sources like hydropower plants 3.6%, biomass and wood fuel
plants 1.6%, and coal 3.5% (ADB, 2011). In 2007, residential electricity consumers used
49% of the total electricity supply, followed by 15% by industry, 26% by commercial users,
and 10% by the administrative sector (RGC, 2009).
The electricity demand is on the increasing trend with the annual growth rate of around
19%country wide, and 25% in Phnom Penh City3, which needs the government to achieve
the annual increase of generating capacity of 20% to stabilize electricity sector (MIME,
2013). In 2010 total electricity supply in Cambodia increased to 2,203.18 GWh within the
installed capacity of 537 MW and 40% of total electricity production was imported from
2
Cambodia Daily Newspaper, Hun Sen Reaches for Ambitious Income Target,
http://www.cambodiadaily.com/archive/hun-sen-reaches-for-ambitious-income-target-18766/, (accessed 04
November 2013)
3
Presentation by Victor Jona on Cambodia Energy Status and Its Development during the 2011 Cambodia
Outlook Conference A Partnership of CDRI and ANZ Royal Bank on 16 March 2011, At Phnom Penh Hotel,
Phnom Penh, Cambodia
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neighbouring countries including Viet Nam (67%), Thailand (32%) and Lao PDR (1%) with
the total capacity of around 225 MW, 48% increase compared to the figure in 20094. Late
2012 high ranking officers from the Ministry of Industry, Mines and Energy (MIME) indicated
that the electricity supply for the whole country during the year reached 1,000 MW, while up
to 400 MW was consumed by only Phnom Penh City5. The demand is expected to increase
up to 1,349 MW by 2015 and to 2,401 MW by 2020 (ECA, 2010).
The electricity consumption increase is caused by certain factors. Firstly, Cambodia’s
population growth with the annual rate of 1.54% from 11.4 million in 1998 to 13 million in
2008 probably explains the increase of the country’s electricity demand (NIS, 2008; NIS,
1998). The consumption increase is also deliberately planned. The intention to increase
electricity supply in Cambodia by the RGC was articulated in the country’s 1994 Power
Sector Development Policy, which aimed at providing an adequate electricity supply
throughout the country (MIME, 2003). This policy was integrated in the RGC’s Rectangular
Strategy Phase I and II, which focuses on planned economic growth from 2006 to 2013. In
these two strategic plans, the development of electricity generating and transmission
capacity is part of the government’s effort to rehabilitate old, and build new, physical
infrastructures throughout the country (RGC, 2006; RGC, 2009). Secondly, economic growth
has also contributed to the increased electricity consumption. The GDP per capita in
Cambodia grew from approximately USD 277 in 2000 to USD 830 in 2010 (NIS, 2010). This
growth has been driven by the growth of garments and footwear, hotel and restaurant,
construction, and agriculture sectors (CDRI, 2012) which is believed to put more pressure on
existing electricity shortage. The annual electricity demand per capita in 2006 was only 48
kWh (World Bank, 2006) while in 2010 it grew to 159.2 kWh6. Thirdly, access to the electricity
grid is also another catalyst of electricity consumption growth. The number of people with
access to electricity was less than 15% of Cambodia’s population in 2006 (World Bank,
2006), but in 2010 national electrification reached 29% of Cambodia’s population7. In 2010,
annual electricity demand in Phnom Penh was by 25%, where only 1.5 million people reside8.
Almost 100% of households in urban areas were electrified; the same was true of only 12.3%
of rural households9.
In general, the electricity price is in Cambodia is very high and higher than other countries in
ASEAN countries. The electricity price for residential area is from USD 0.08 to USD 0.15 per
kWh; for commercial purpose from USD 0.12 to USD 0.16 per kWh; and for industrial
purpose from USD 0.12 to USD 0.15 per kWh (CDRI, 2012). However, the variation of the
tariff is significant throughout the countries depending on what source of electricity the
people use and what location they are living at. The electricity tariff can reach up to USD
0.18 per kWh in Phnom Penh and up to USD 0.3 per kWh in provincial town and up to USD
0.75 to USD 1.25 per kWh in the remote areas where electricity is generated by small-scale
private body (Middleton & Sam, 2008). According to figure from EDC in 2007, the total sale
of electricity (from EDC, Independent Power Producer, and Import) was 1,222.52 Gwh
4
Presentation by Victor Jona on Cambodia Energy Status and Its Development during the 2011 Cambodia
Outlook Conference A Partnership of CDRI and ANZ Royal Bank on 16 March 2011, At Phnom Penh Hotel,
Phnom Penh, Cambodia
5 Phnom Penh Post Newspaper, Sustainable Energy in Cambodia Plans Target by 2030,
http://www.phnompenhpost.com/National/sustainable-energy-in-cambodia-plans-target-by-2030.html, (accessed
10 January 2013)
6 Presentation by Victor Jona on Cambodia Energy Status and Its Development during the 2011 Cambodia
Outlook Conference A Partnership of CDRI and ANZ Royal Bank on 16 March 2011, At Phnom Penh Hotel,
Phnom Penh, Cambodia
7 Ibid
8
Phnom Penh Municipality, Facts about Phnom Penh, http://www.phnompenh.gov.kh/phnom-penh-city-facts99.html, (accessed 15 July 2013)
9 Presentation by Victor Jona on Cambodia Energy Status and Its Development during the 2011 Cambodia
Outlook Conference A Partnership of CDRI and ANZ Royal Bank on 16 March 2011, At Phnom Penh Hotel,
Phnom Penh, Cambodia
Page-12-
producing the 2007 revenue of USD 231 million. The amount of the electricity was consumed
by 286,660 users, and 35.3% of the consumption was by 177,124 residences across the
country in 16 cities and provinces (EDC, 2007). Therefore, with this figure, the average rate
of electricity in 2007 is around USD 0.19 per kWh and the annual electric utilities paid by
each residence who can access and effort to pay was around USD 460 which was more than
two third of GDP per capita of the year which was only USD 623.
Beyond high price, electricity supply in Cambodia is unreliable. Recently, there are frequent
electricity blackouts, especially in Phnom Penh, where around 40% of the total electricity
supply is consumed in late 201210. Of course, the electricity blackout irritates and affects the
quality of life of the people, but it has been the concern of some businesses institutions that it
reduces the efficiency of their production. To cope with this, those business organization use
own generators from which they have to pay more for gasoline. This expensive and
unreliable energy supply is highlighted as a major disincentive to potential investors (Mark,
2012). For instance, AMRU Rice Cambodia, one of the biggest rice exports, had complained
that during dry season the company has faced with electricity cut offs at least two hours per
day which slows down the company’s productivity11. As a result, government has set up
power sector policy and established power development plan 2008-2020 to response to the
demands including the development of domestic hydropower projects12. As policy, the
government sets the target that by 2020 all villages in Cambodia will access electricity by
different kinds of electricity sources and by 2030 at least 70% of the people in Cambodia will
be accessible to quality electricity grids13. In addition, by 2020, Cambodia would be capable
to export electricity more than 4,000 MW to neighbour countries14.
Responding to these problems, the government focuses on two solutions: increasing the
supply side while controlling the demand side. The RGC has set the target that, by 2020, all
villages in Cambodia will access to electricity from whatever sources, and that by 2030 at
least 70% of Cambodia’s people will have access to a quality electric grids which are more
reliable15. Even though Cambodia electricity consumption is still lower than most of the
ASEAN nations, the government still consider controlling the demand side. Along with 2012
commitment in the ASEAN to reduce energy intensity by 8% from 2005 level to 2015
(ASEAN, 2012), Cambodia has, in 2008, issued a circular to raise the awareness of
electricity saving among the public and guided all governmental institutions to follow energy
saving rule including the crackdown on electricity stealth (RGC(a), 2008). Moreover,
Cambodia has an electricity tariff policy which is seen to be pro-poor, meaning that the tariff
is lower for the consumption less than 200 kWh16 and this is understood to contribute to the
control of electricity demand side.
1.2. Problem Statement
High energy cost, inadequate and unreliable sources of powers is one of the issue affecting
both national and GMS infrastructure program for connectivity which are critical for future
growth and development (WEF, 2011), while the government of Cambodia acknowledges
that the country is facing energy issue which was seen to be a challenge against the
10
Phnom Penh Post Newspaper, Blackouts Leading to Reduced Production,
http://www.phnompenhpost.com/business/blackouts-leading-reduced-production, (accessed 10 January 2013).
11
Phnom Penh Post Newspaper, Cambodia's Top Ten Rice Exporters Elected,
http://www.phnompenhpost.com/business/cambodias-top-ten-rice-exporters-elected, (accessed 10 January 2013)
12 Presentation by Victor Jona on Cambodia Energy Status and Its Development during the 2011 Cambodia
Outlook Conference A Partnership of CDRI and ANZ Royal Bank on 16 March 2011, At Phnom Penh Hotel,
Phnom Penh, Cambodia
13 Presentation by Victor Jona on the Energy Efficiency Challenge and Opportunities in Cambodia during the 2nd
EAS Energy Efficiency Conference on 31 July- 2012 August at Sofitel Phokeatra Hotel, Phnom Penh Cambodia
14 Ibid
15 Ibid
16
Interviewed with representative officer of MIME on 23 August 2013
Page-13-
government’s efforts in reconstruction and socio-economic development of the country
(MIME, 2003). Cambodia’s electricity demand is on the upward trend with the annual rate of
around 19%in the whole country17. In 2010, Cambodia imported 40% of total electricity
production from neighbouring countries such as Viet Nam (67%), Thailand (32%) and Lao
PDR (1%) and this the level of import increase drastically18.
Cambodia’s electricity costs are still among the highest in the Greater Mekong Sub-region
and in the world due to the high cost of imported diesel (King et al, 2007; World Bank, 2006).
As a matter of fact, in 2009, up to 91.4 percent of energy is from imported diesel and fuel oil
(ADB, 2011). Moreover, electricity supply in Cambodia is unreliable, which are all seen as
one of the obstacles for the motivating the investor to come in Cambodia (Mark, 2012).This
shortage of power supply was also seen as a challenge against the continuing effort of the
government in reconstruction and socio-economic development of the country and Cambodia
needs to utilize its hydropower potential to meet future electricity demand as well as to
gradually become independent from energy imports and fuel energy (MIME, 2003).
Generally, hydropower was thought to be a comparatively clean, low-cost and renewable
energy source (ADB, 2011), while at the same, lots of social and environmental issues
emerges from the development. There are concerns over how the decision making of
hydropower development is well done for the sack of development or not. In Cambodia, Lao
PDR and Viet Nam, the transparency in the decision making process is still low in spite of
legal frameworks which are potential to regulate more sustainable hydropower outcomes.
The decision making was found to be easily vulnerable to the influence by developers and
other actors with money and access to political power. Moreover, the decision making does
not guarantee equal benefit and the interest of the weakest segments of society was not
effectively responded (Diana Suhardiman et al., 2011).
In Cambodia, 14 potential sites were identified for hydropower projects across Cambodia
including Sambor Hydropower Project which is planned to construct on Mekong mainstream
and set to be commissioned in 2016 (MIME, 2003). Until now the decision making of
development of those hydropower dams has been inaccessible in general; energy planning
process currently remains closed to public participation and civil societies are arguing for a
more sustainable energy option rather than hydropower development19. Furthermore, the
existing and ongoing project issues emerge around the Environmental and Social Impact
Assessment (ESIA). For example, in Lower Sesan 2 and other existing hydropower dams in
Cambodia, ESIA reports were rejected by civil societies and the affected people mainly
because of lack of public participation and quality of the report (Mark, 2012; Biard, 2009).
This study is expected to contribute to find out factors causing such flaws in hydropower
decision making and come up with recommendations toward a better hydropower decisionmaking in Cambodia, as well as in Mekong Region. To the discover above-mentioned
factors, impact assessment process is used as a lens to understand the drivers and enablers
of hydropower decision-making process, during which there exist diversified involvements
from public sphere including the both powerful and vulnerable actors interacting with each
other around the issues.
1.3. Objectives
 To identify key drivers that influence hydropower (HP);
 To understand EIAs and SIAs influence on HP decision-making; and
17
Presentation by Victor Jona on Cambodia Energy Status and Its Development during the 2011 Cambodia
Outlook Conference A Partnership of CDRI and ANZ Royal Bank on 16 March 2011, At Phnom Penh Hotel,
Phnom Penh, Cambodia
18
Ibid
19 International River, www.internationalrivers.org/campaigns/cambodia, (accessed 23 July 2013)
Page-14-
 To identify ‘power in relation’ in HP decision-making
1.4. Research Questions
 What are the drivers that influence HP decision-making?
 To what extent do EIAs and SIAs influence HP decision-making?
 What do the ‘power networks’ in networks’ in HP decision-making look like?
 Who are key financers and why?
 Who are the winners and losers due to the environmental changes?
Page-15-
Chapter 2: Methodologies
2.1. Site Selection
The study focuses on two different case studies including Lower Sesan 2 (LS2) hydropower
project in Stung Treng and Kamchay hydropower project in Kampot provinces. The Kamchay
dam locates in part of Bokork National Park. It is a large dam and it has operated since 2011.
There are two villages are located in the downstream of the Kamchay dam are selected for
interviews where the upstream is a part of National Park with no residential setup.
LS2 is the planned hydropower dam set to be constructed in 2014 and is the second large
dam ever built in Cambodia locates in Mekong River Basin where there exists three Rivers:
Sesan, Srepok and Sekong. For diversification purpose, three villages in the upstream (in the
planned reservoir), and two villages in downstream of the dam were selected.
The study conducted household interviews with 106 households in Stung Treng province
stated as below:
Table 1: Selected Study Areas and Number of Household Samples
province
District
Commune
Village
Stung Treng Sesan
Phluk
Phluk (downstream)
Banbong (downstream)
Kbal Romeas
Kbal Romeas (upstream)
Srekor
Srekor1 (upstream)
Srekor2 (upstream)
Total
1 district
3 Communes
5 villages
Sample
25
15
26
23
17
106
2.2. Research Method
Document Review and Analysis Method
Review and analysis of related documents, such as constitution, land law, water law,
environmental law, regulations or principles for hydropower decision making, EIA, previous
literatures, journals, books, reports written by many different scholars. The findings from the
literature review are the integral part of the entire research process and can make value
contribution to the research. Precisely, by reviewing those documents, the team could
understand and gain more knowledge of many issues surrounding the research topic.
Field Observation
This approach aim to see the actual target study sites, introducing the project, clarifying
some issues, building network with all key stakeholders and partners at provincial levels
before selecting samples and conducting interview. Both individual and group meeting are
conducted during the field observations. The project plans to meet local villagers, local
authorities, provincial departments, provincial vice governor, hydropower company’s
representatives, and civil societies.
Recently, the team has conducted a few field observations in the two target sites already.
Each of the field visit have provided the team loads of the understanding of many issue
regarded to the topic and especially given us a great opportunity to build up the all concerned
stakeholders as a very strong network.
Table 2: Field Observation Activities in Kampot and Stung Treng Provinces
No.
Field Survey
Time
Number of people met
1
Stung Treng province
12-15 January 2013
22 person
2
Kampot province
14-16 February 2013
16 person
Page-16-
3
4
5
Stung Treng province
06-09 April 2013
Stung Treng province
11-17 May 2013
Kampot province
27-28 October 2013
Total
* This number include interviewed KI below
5 person
59 person
12 person
114 persons*
Key Informant Interview, Focus Group Discussion and Household Questionnaires
Checklist and key informant interview and questionnaires were applied in the processes of
the study. In total, 106 samples were selected for conducting in-depth interview in Stung
Treng province as mentioned in Table 2 above. In addition, key informant interview was
conducted with representatives from the government agencies International Organizations
and Local Non-Governmental Organizations. Information gathered from the interview was
processed and transcribed. Some useful analysis tools such as Ms. Excel were applied.
Table 3 shows Key Informant interview conducted in Phnom Penh that are representatives
from the government institutions in national level and NGOs.
Table 3: Interviewed Key Informants
No.
Institutions
1
Deputy Director, EIA Department, Ministry of Environment
(MOE)
2
NGO Forum on Cambodia
3
International Union for Conservation of Nature (IUCN)
4
Tonle Sap Authority (Government agency)
5
Ministry of Water Resource and Meteorology (MOWRAM)
6
Deputy Director General, Department of Energy, Ministry
of Industry, Mines and Energy (MIME)
7
Culture and Environment Preservation Association (CEPA)
8
Center for Development Oriented Research in Agriculture
and Livelihood Systems (CENTDOR)
9
Fisheries Action Coalition Team (FACT)
10 Fauna & Flora International (FFI)
11 Deputy Director General, Department of Energy, Ministry
of Industry, Mines and Energy (MIME)
12 Technical Director, Conservation International (CI)
13 4 NGOs’ representatives, 5 Provincial Departments’
Representatives (PDoE, PDOWRAM, PDoA, PDoIME), 4
Community’s representative (Pluk, Srekor, Kbal Romeas
communes), and 1 preventative from FA
14 4 representative of local authorities (Sesan district, Pluk
commune, Kbal Romeas commune, Serekor commune)
and 1 representative from FA
15 2 Commune Chiefs (Mak Prang and Kampong Kreng of
Kampot province), 5 representatives from provincial
department in Kampot (PDoT, PDoE, PDoIME,
PDoWRAM, PDoA), 1 representative from FA, 1
representative from Stung Treng provincial hall
Total
Time
Number
14/12/2012 1 person
06/03/2013
13/03/2013
15/03/2013
18/03/2013
19/03/2013
2 persons
2 persons
1 person
1 person
1 person
19/03/2013 1 person
23/03/2013 1 person
12/08/2013 2 persons
19/08/2013 2 persons
23/08/2013 1 person
30/08/2013 1 person
12-15
14 persons
January
2013
06-09 April
2013
5 persons
14-16
February
2013
9 persons
44 persons
2.3. Theoretical Framework
This research applies Political Ecology (PE) as analysis approach to understand the
interaction between all stakeholder in the context of environment, economic, social and
political aspects. The PE focuses on human ecology—the interaction of social system and
Page-17-
ecosystem—and political economy, which encompasses the constantly shifting dialectic
between society and land based resources, and also within classes and groups within
society itself (Blaikie and Brookfield, 1987). With this approach, the study analyses power
relations between different multiple layers to come up with the understanding of how
decisions are made regarding to hydroelectric power development, and how to improve this
interaction to increase the social and ecological benefits from dam. Figure 1 below illustrates
the interaction between various inter-related stakeholders involving in hydropower
development in Cambodia including the government, community/people, CSOs,
investor/constructor, financer and media. The information of how these stakeholders interact
with each other from local to regional level over the issues of dam development and the
social, environmental impacts will the understanding of drivers and enablers affecting the
hydropower decision making in Cambodia. Hence, this research explores the relations
between different stakeholders in different levels: local, district, provincial, national, and
regional level.
Figure 1: The Use of Impact Assessment to Understand Drivers and Enablers
Project initiation and project planning
Construction Kick-off
Impact Assessment Process
Focus: relationship of power, economic and politics
Community/people
- Right
- Participation/public
consultation
Financer
- Safeguard measure
- Financial model
- Influence
Government
- Policy Legal
framework and
instrument
- Enforcement capacity
and resources
- Power
- Institutional
arrangement
CSOs
- Institutional arrangement
- Power/strength
- Participation/public
consultation
Investor/constructor
- Sustainability
framework
- Social responsibility
framework, CSR
- Reason for investment
Drivers
and
Enablers
of
Hydropo
wer
Decision
Making
Improvement of
hydropower
decision making
Medias
- Role/involvement of
media
Legend:
: The arrow represents the interaction between stakeholders
CSR: Corporate Social Responsibility
CSO: Civil Society Organization
Source: Authors, 2013
In the case of LS2 hydropower dam, the study tries to look in to the interaction between
various inter-related stakeholders involving in hydropower development in Cambodia
including the government, community/people, CSOs, investor/constructor, financer and
media. The information of how these stakeholders interact with each other from local to
regional level over the issues of dam development and the social, environmental impacts
leads to the understanding of drivers and enablers influencing the hydropower decision
making in Cambodia.
The space that all stakeholders interact is important with which information sharing,
participation, utilization of authorities and so on can be checked to understand the elements
suggested in PE. This research uses Environmental Impact Assessment process of
hydropower project as a lens so that information of interaction among all stakeholders can be
Page-18-
accessed for analysis. As stated in Scottish National Heritage in a Handbook on EIA, “[EIA]
is the whole process of gathering environmental information; describing a development or
other project; predicting and describing the environmental effects of the project; defining
ways of avoiding, reducing or compensating for these effects; consulting the general public
and specific bodies with responsibilities for the environment; taking all of this information into
account before deciding whether to allow the project to proceed and ensuring that the
measures prescribed to avoid, reduce or compensate for environmental effects are
implemented (SNH, 2009:136).
According to this definition, EIA is not only a simple process of gathering environmental
information for designing the project, but also layouts the responsibility of responsible actors
to disseminate the information about their project to and consult with general public or
relevant institutions to make sure that the environmental information reflect the real issues by
taking into account every diversified involvements from public sphere including the both
powerful and vulnerable actors around the hydropower decision making. Therefore, this
study does not only see the EIA as the simple process of gathering environmental
information for designing the project, but also a space at which responsible actors
disseminate the information about their project to and consult with general public or relevant
institutions to make sure that the environmental information reflect the real issues by taking
into account every diversified involvements from public sphere including the both powerful
and vulnerable actors around the hydropower decision making. Furthermore, hydropower’s
narrative also was used to understand key stakeholder’s roles and perspectives on LS2
hydropower dam.
Page-19-
Chapter 3: Overview of Hydropower Development
3.1. Global and Regional Hydropower Development
Around 2,000 BC, dam was found to be widely used for irrigation and water supply; as the
evidence, certain of earth embankment dams for water diversion still remain in Sri Lanka and
Israel (Schnitter, 1994). Up to now so many large dams have been built all over the world. By
the 20th century, there were more than 45,000 large dams in 140 countries (ICOLD, 1998).
The rate of dam building rose during the economic growth after World War II; particularly, the
period from 1970 to 1975 was seen to be the fastest growing of dam building, during which
almost 5,000 large dams were built around the world and it is noted that China alone own
almost half of the world’s dam (22,000 dams), and it is the countries among the top five
countries that own nearly 80% of total dam in the world (WCD, 2000). Around two trillion
USD was estimated to be invested in the construction of large dam during the 20th century.
However, it is remarkable that dam construction has slowed down, 60% decreased (Imhof, et
al., 2002) worldwide after the peak period of the 1970s, especially in North America and
Europe when the most technically attractive sites for dam constructions are already
developed (WCD, 2000).
Dams have been promoted as a long-term and strategic investment which can produce
multiple benefits and it is the way to respond to water and energy needs. These days, dams
are used to regulate, store and diverse water from river to farm lands, to supply for water for
industrial and human use in town and cities, to generate electricity and to control flood. In
many countries, dam for electricity generation firstly found around 1890, is the most
important reason for the construction of large even though it is stated as the primary purpose
or just the additional one. Nineteen percent of the world electricity supply among 150
countries is from hydropower dam; moreover, hydropower was thought to be a comparatively
clean, low-cost and renewable energy source (WCD, 2000).
In Mekong region, dams were planned, constructed, and operated in Mekong River Basin—
Upper Mekong Basin in the China and Myanmar, and Lower Mekong Basin overlay Lao
PDR, Thailand, Cambodia, and Viet Nam. There are more than 70 million people residing in
Mekong Basin with the estimated increase around 65 percent to reach 120 million by 2025
(Steward, 2008). In Lower Mekong Basin, there are up to 30,000 MW hydropower potential,
from which more than 10% was already developed all on the river’s tributary system mostly
during the last two decades (MRC, 2010). MRC in 2010 reported that Mekong region is one
of the most active regions for hydropower development in the worlds. The growth of
hydropower development in the area is because of, on the one hand, the energy policies and
strategies to reduce the energy poverty gap among countries in the region and to build a
sustainable energy future related to its energy sources, and on the other hand, because of
the promotion of energy grade among GMS countries, by which certain countries like Laos
PDR and Cambodia can generate income from selling energy produced by hydropower as
energy potentials are bigger than their national demands (MRC, 2010).
Hydropower development becomes controversial when dam are planned on the mainstream
of Mekong River (MRC, 2010). In LMB there are at least 11 potential sites on Mekong River’s
mainstream under feasibility study phase with the total capacity of 14.697 MW, while in
China the Upper Mekong region up to 8 hydropower dams are completed, under
construction, and planned. The plan to build hydropower dams in LMR’s mainstream were
proposed since the 1960s followed by the 1994 plans by Mekong Secretariat, but vanished
partly because of the complaint over its huge negative effects. However, the approvals in
2006 by Laos, Cambodia and Thailand to conduct studies for the construction of a series of
dams on Lower Mekong River’s mainstream are seen to be a serious threat to the river
Page-20-
ecology and leave millions of people whose livelihoods depend on the river under the risky
conditions20.
Table 4: Existing, under Construction, and Planned Dam in LMB
Countries
Mainstream
Tributary
Planned
Existing
Under
Planned
construction
Cambodia
2
1
11
(4,280 MW)
(1 MW)
(1,309 MW)
Lao PDR
9*
11
9
71
(10,417 MW)
(738 MW)
(2,764 MW)
(6,847 MW)
Thailand
7
(745 MW)
Viet Nam
7
5
3
(1,205 MW)
(1,016 MW)
(363 MW)
Total
11
26
14
85
(14,697 MW)
(2,688 MW)
(3,780 MW)
(8,519 MW)
Total
14
(5,590 MW)
100
(20,767 MW)
7
(745 MW)
15
(2,583 MW)
136
(29,684 MW)
*Two projects shared border between Lao PDR and Thailand
Source: MRC, 2011
3.2. Hydropower Potential and Plan in Cambodia
The energy development activities in Cambodia these days have been following the
Cambodia Energy Strategy 2006-2020 which was supported by World Bank21. During the
third legislature, the RGC mentioned in its NSDP phase I 2006-2010 about the need of
availability of the assured, abundant, low-cost electricity to be the key to development of
Cambodia. Along with that the government had also been promoting the development of
cheaper, renewable, alternative energy sources including solar energy, wind energy, biogas,
and mini-hydro schemes (RGC, 2006:24). With Energy Strategy the RGC expects to achieve
energy independent through power trade and exchange with neighbouring countries and
regional integration with the emphasis on the involvement of private sector (RGC, 2006:64).
Two among several achievements relating to energy development in the Third Legislature is
the commencement of construction of the hydro-electric generating station at Kamchay and
Atay hydropower dam (RGC, 2009:148).
During the fourth legislature, the government continues to set policy priority on energy sector.
The government keeps pushing for stronger electricity capacity by encouraging the
construction of low cost generating plants which use such local energy sources as
hydropower, natural gas and coal (RGC, 2009:148). Within 5 years from 2009-2013, the
government has set to commission 5 hydropower stations and 2 coal power plants as shown
below:
Table 5: Commission Plan of Hydropower/Coal-Fire Stations by the Government from
2009-2013
No
Dam/Coal Fire plant
Planned Year of
commission
1 Kamchay Hydropower Station (193 MW)
2011
2 Commission Kirirom Hydropower Station III (18 MW)
2012
3 Commission the First Phase (100 MW) of the Thermal Coal
2011
Power Plant 1 with the total capacity of 200 MW in Preah
Sihanouk Province
20
International River, Mekong Mainstream Dam, www.internationalrivers.org/campaigns/mekong-mainstreamdams, (accessed 24 August 2013)
21
Interviewed with representative officer of MIME on 23 August 2013
Page-21-
4
5
6
7
Commission Stung Atay Hydropower Station (120 MW)
Commission the Second Phase of the Thermal Coal Power Plant
1 with the total capacity of 200 MW in Preah Sihanouk Province
Commission Stung Tatay Hydropower with one part of its total
power of 246 MW
Commission Stung Russey Chrum Krom Hydropower with one
part of its total power of 338 MW
2012
2012
2013
2013
Source: Presentation by Victor Jona, 2011; MIME, 2003
The assessment of water resources for hydropower development in the Kingdom of
Cambodia indicated that this country has an abundant hydropower potential. In June 2003, a
National Sector Review of Hydropower was prepared by MIME and the Cambodian National
Mekong Committee (NMC). In this review, it is shown that there are about 60 possible sites
for hydropower development in Cambodia, of which 14 were identified as priority projects
(MIME, 2003). To thoroughly investigate and prioritize the potential hydropower sites as well
as to prepare Cambodia’s Hydropower Development Master Plan which will support the
Energy Sector Development Strategy for the period of 20 years, the RGC in 2007 requested
the Japanese Government through JICA to conduct the Mater Plan Study of Hydropower
Development in Cambodia (JICA, 2007). Accordingly, JICA focused on 29 selected
hydropower sites which have capacity to generate more than 10 MW out of 60 potential sites
(JICA, 2007). However, the result of the master plan study was not released publicly
because, according to a source from MIME, the report raises too many concerns over the
negative impact caused by those proposed dam, which does not reflect the real situation of
Cambodia22. Energy Sector Strategy Review by World Bank in 2006 stated that from 2004 to
2020 Cambodia has identified 14 potential hydropower projects which could produce power
capacity varying from 1,900 MW to 4,700 MW according to the scale of Sambor Hydro which
will be built on Mekong Mainstream (World Bank, 2006).
According to the review of hydropower sector by MIME in 2003, Cambodia has a total
estimated hydropower potential of 10,000 MW; 50% of which locates on Mekong River’s
mainstream, 40% on its tributaries and 10% in the southwest outside the Mekong Basin. In
the planned hydropower project by MIME (2003), Cambodia has not included any
mainstream hydropower projects in the nearest future power development plan. The size of
the mainstream projects and the largest scheme on the main tributaries is too large for
domestic supply, but if dam on mainstream is to be built, the purpose is to sell electricity to
southern Viet Nam or Thailand (MIME, 2003).
Until recently the hydropower potential of Cambodia remained untapped, aside from smallscale dams at O Chum II (1 MW) in Ratanakiri province and the Kirirom I (12 MW) in
Kampong Speu province, Kamchay hydropower dam (193 MW) was totally completed and
commissioned on December 07, 2011, Kirirom III hydropower (18 MW) was commissioned in
February 2013. Up to now, there are four hydropower development projects under
construction including Lower Russei Chhrum, Atay and Tatay Hydro23. In late 2012, the LS2,
the Cambodia’s first large-scale hydropower, was approved by the government of Cambodia
to be built in 201424.There are also at least 12 other hydropower projects across the country
under the MOU of feasibility studies 25.
22
Interviewed with representative officer of MIME on 23 August 2013
Presentation by Victor Jona on Cambodia Energy Status and Its Development during the 2011 Cambodia
Outlook Conference A Partnership of CDRI and ANZ Royal Bank on 16 March 2011, At Phnom Penh Hotel,
Phnom Penh, Cambodia
24 Cambodia Daily Newspaper, Construction of Lower Sesan Dam to Start in 2014,
http://www.cambodiadaily.com/archive/construction-of-lower-sesan-dam-in-stung-treng-to-start-in-2014-5320/,
(accessed 10 August 2013)
25 Presentation by Victor Jona on Cambodia Energy Status and Its Development during the 2011 Cambodia
Outlook Conference A Partnership of CDRI and ANZ Royal Bank on 16 March 2011, At Phnom Penh Hotel,
Phnom Penh, Cambodia
23
Page-22-
Table 6: Current Hydropower Dams under Construction and Development in Cambodia
Project
Location
Investment
Detail
Company/Country
Lower Russey
Koh Kong China Huadian
 Installed capacity: 338MW
Chhrum
province
Corporation
 Estimated cost: USD 209 million
(CHC)/China
 Completion year: 2014
 BOT project
Stung Tatay
Koh Kong Sinohydro/China
 Installed capacity: 246 MW
 Estimated cost: USD 215 million.
 Completion year: 2015
 BOT project
Lower Sesan 2
Stung
Lower Sesan 2
 Installed capacity: 400 MW
Treng
Hydro Power Co.
 Estimated investment cost: USD
Ltd
781 million
 Estimated cost: USD 781.52 million
 Expected year of commissioning:
2017
Stung Atay
Pursat
China Yunnan
 Installed capacity: 120 MW
Corporation for
 Estimated cost: 255 million*
International
 Expected year of commissioning:
Techo-Economic
2012* (now ongoing)
Cooperation*
 BOT project
Source: Presentation by Victor Jona, 2011; *Middleton & Sam, 2008
Hydropower projects on Mekong River’s mainstream were not included in short-term
Hydropower Development Plan. Cambodia understand that any project to be built on
mainstream will be produce electricity surplus which will be exported to neighbouring
counties like Southern Viet Nam or Thailand who are facing shortage of electricity.
Nevertheless, Sambor Hydropower Project, to be built on the mainstream with installed
capacity 467 MW or 3,300 MW was actually included in the long-term hydropower
development plan in 2003, but the government agreed that further studies is needed before
deciding to build such hydropower dam (MIME, 2003). Even though the feasibilities of the
proposed Sambo hydropower on the upper part of Mekong Mainstream in Kratie province, for
example, have been studied since 200626, senior official from MIME claimed that the
construction of hydropower dam on Mekong’s Mainstream will be possible only after 203027.
Even though the government has started with hydropower dam on tributaries, it is apparent
that the government still has the intension to export energy when government select
hydropower project base on accessibility; “… Hydropower development based initially on the
easily accessible sites subsequently the export oriented projects: Stung Atay, Stung Russei
Chrum, Chay Areng, Lower Se San 2, Lower Sre Pok 2 and also the three Battambang hydro
sites”(MIME, 2003).
3.3. Justification of Hydropower Dam Development in Cambodia
Hydropower is generally thought to be and promoted by dam developer as a comparatively
clean, low-cost, renewable energy source that relies on proven technology. It has low
operating costs, but long operational life and, in the past, it is seen as a worthy energy
source by the countries that depend heavily on imported fossil fuels for power generation
(WCD, 2000). This perception was seen to be re-iterated by the RGC whenever speaking
about the benefit of hydropower dam in Cambodia. For example, during the inauguration of
26
International River, Sambor Dam, http://www.internationalrivers.org/campaigns/sambor-dam, (accessed 25
November 2013)
27 Interviewed with representative officer of MIME on 23 August 2013
Page-23-
Kamchay dam as saying that the project provides power sources for stimulating the
economic dynamics and ensuring growth, sustainable growth and social welfare by
increasing the power supply capacity to serve the need of socio-economic activities.
Moreover, the energy from the above dam is used to complement the constantly rising price
of oil, gas and coal, and other renewable energy sources (RGC, 2011).
Official from MIME claimed that hydropower development is moving along with the regional
effort to achieve renewable energy target as set in the ASEAN region to achieve 15% of
renewable energy in the total installed power capacity by 2015 (ASEAN, 2012). The RGC is
working to contribute to this target and hydropower is the main alternative which can help the
country increase the renewable energy, meanwhile gain the lower cost of electricity
generation compared to other electricity sources28. Similarly, hydropower was expressed in
the Cambodia’s national report for Rio+20 United Nation Conference on Sustainable
Development 2012 as the corner stone of Cambodia’s energy policy (RGC, 2012). Moreover,
the hydropower choice was claimed by RGC that it matches the current context of Cambodia
as the country has abundant of untapped water which is good for hydropower, but has limited
or no resources to support other energy alternatives like generators run by gas, biogas,
nuclear and so on (RGC(a), 2013).
The cost of investment is another reason to choose hydropower. Cost of electricity generation
is the main concern when the country is integrated into ASEAN to keep the country
competitive. As claimed by MIME, the current fuel generation and certain alternative energy
solution including mini-scale hydropower dam will not help Cambodia achieve low electricity
cost, while the cost of construction will be higher and building the smaller one (MIME, 2013).
Cambodia has been a cash-strapped country; therefore, to develop energy sector, the
government needs involvement from private sectors. However, small scale hydropower and
other renewable energy sources are not attractive to private investors in Cambodia. Those
energy sources were mostly done under the grant provided by donors and construction cost
is claimed by the government to be high29.
The RGC acknowledges the need to consider social and environmental impacts from
hydropower dams (RGC, 2011) and, at the same time, believe that tributary hydropower
dams would cause less negative impacts than the mainstream ones. That is the reason that
Cambodia start building dam from tributary dam which is thought to be good at beginning
stage to meet the electricity demand and after the demand is fulfilled, building dam on
mainstream can be considered, but will not be before 203030. Similarly, for the case of Lower
Sesan 2 dam, RGC legitimizes the project by saying that the dam is not on Mekong River’s
mainstream and that the resources are already degraded and water regime are already
changed by many dams on Sesan River in Viet Nam’s territory. However, the RGC will not
reject the construction of mainstream dam, for instance, Xayaburi dam in Lao PDR, if there is
scientific study showing that the impact is acceptable31.
In balancing the cost and benefit of the dam, the RGC is seen to reconcile the negative
impact with dam’s importance for development by comparing macro perspective from the
government and the micro perspective from CSOs; the government hay a say that “we
should not look at a single tree, but the whole forest”(RGC(b), 2008), “the impact is the
natural consequence of economic progress and no development can be done without impact
on environment and natural resources”(RGC(a), 2010), “there is a need to scarify some for
the development the country32”. Responding to these narratives, certain CSOs have shown
their positions that they are not rejecting hydropower as the energy solution; however, the
28
Interviewed with representative officer of MIME on 23 August 2013
Ibid
30 Ibid
31
Ibid
32 Ibid
29
Page-24-
way hydropower project is planned and implemented are the main reasons behind their
advocacies, which will be discussed in the following section.
3.4. Problems Caused by Hydropower Development in Cambodia
As mentioned above, the hydropower potential in Cambodia still unused. So far, most of
commissioned hydropower stations in Cambodia are in small-scale, except Kamchay
hydropower dam which was competed and commissioned in 2011 with the installed capacity
of 193 MW in Kampot province. The actual and physical negative effect on people from
Cambodia’s hydropower dams is not so outstanding. The reason is those hydropower dams
under operation are not large scale and were built outside Mekong basin and where the
dam’s effect does not significantly and directly impact the people. Kamchay hydropower dam
is the first large dam in Cambodia; however, the effect was not significant as other compared
to those newly proposed dams in northeastern part of the country or on Mekong River’s
mainstream. Kamchay dam was located in the mountainous areas and no resettlement is
needed in this project. The downstream villages do not depend so much on the Kamchay’s
water as well as the affected agricultural land in the reservoir of dam No2.
Nevertheless, people in the northeastern part of the country like Ratanakiri and Stung Treng
province have been physically suffered by the trans-boundary impacts caused by dams built
in the upper part of Sesan River especially the Yali Fall dam in Viet Nam territory. There are
many studies on impact of Yali Fall dam on Cambodian people. Since the dam was
commissioned in 2000, around 55,000 downstream villagers were negatively affected and
the impacts as well as the victims have never been addressed, but at the same time, more
dam are planned and built on the river in Viet Nam’s territory33. Certain study show that there
are certain commitment and solution after the negative exists soon after the operation of Yali
Fall dam such as a food relief supported by Viet Nam side to the affected Cambodian people
in O’ Yadav of Ratanakiri province as well as the establishment of a warning mechanism with
the representative from the two countries. However, the established mechanism does not
work effectively because of financial constrain and the complication of process of the warning
procedure (Rasmey, 2013).
Currently, Cambodia is worrying about the possible effects caused by the planned and
ongoing hydropower projects especially the Lower Sesan 2 dam in Stung Treng province and
other large scale dams proposed on Mekong River’s mainstream such as Sambor and Stung
Treng dams in Kratie and Stung Treng province respectively. The other concerns are the
cross boundary impacts caused by dam in Laos on the upper stream of Sekong and Mekong
Rivers. Based on lesson learned and impacts experiences in the 3S region due to Yali Falls
dams and hydropower other hydropower projects already constructed and operating
upstream in Viet Nam, if the proposed large-scale hydropower projects in the 3S area of
Cambodia is built it could drastically reduce fish stock, changes in the quality of water flows,
and unpredicted surge that have resulted in destruction to property and even loss of life
(Mark, 2012). The flooding caused by reservoirs will inundate a huge amount of land and
lead to forest and habitat loss, causing serious challenges to the area’s biodiversity and local
people’s livelihoods. Blocking fish migration on the Sesan and Srepok Rivers is still disputed
but it is clear that this will cause a number of species to disappear entirely from upstream of
the dams. This had implications for tens of thousands who rely on fisheries for their
livelihoods, both upstream and downstream (Mark, 2012).
Be noted that even though people living at Lower Sesan 2 dam site have not yet affected by
dam in their own countries, but the cross boundary effect of the dams in Viet Nam has
warned them and teach them about the possible impact any other projects proposed to be
33
International River, Cambodia, http://www.internationalrivers.org/campaigns/cambodia, (accessed 13 October
2013)
Page-25-
built in their region. The people gain more knowledge about hydropower dam with the
assistant of local and international NGOs that have been working to provide them with
training as well as exchange trip to see other affected areas overseas (Field survey(a),
2013). The concerns of the people at LS2 dam’s site mounted up, sometime in the form of
demonstration, when the EIA study of this project was accused by civil societies as not
sufficient and does not reflect the real issues in the area because of many factors such as
the lack of participation34 from the public as well as the planning process of project planning
and design is closed to public scrutiny (Middleton, 2008). The complaint of the civil society
about the limited of the EIA study of LS2 project was hit back by government officials to be
baseless, because those NGOs cannot any concrete study or evident that the project will
lead to the effects as claim and, on the other hand, the dam has not been there yet35.
The Predicted Impact the LS2 Dam
The construction of the approved 400MW Lower Sesan 2 hydropower will start in 2014 and
the government will spend the entirety of 2013 to solve the matter with affected families36.
Even though this dam has not been built, many studies predicted certain issues which will be
caused by the dam such as relocation of affected people, decreased fish stock, hydrological
changes and the impact on the Tonle Sap Lake, blocking of fish migration and sediment
flows. The details of the impacts are in the table below:
Table 7: Predicted Impacts of Lower Sesan 2 Dam
- 335 square kilometres of Cambodia territory would be flooded and more than 1,000
families or 5000 people would be displaced and effect dozens of villages along both
rivers, upstream and downstream;
- 267 families and 1,229 people would need to relocate;
- The loss of 1,290 ha of lowland agricultural land, or about one quarter of all the wet
rice paddy land in Sesan district;
- Over 305 square kilometres of land would be flooded, as well as additional 7,086 ha of
forest would be destroyed by resettlement of villages from inundation area;
- The loss of approximately 18,670 ha of natural forest land and 4,896 ha of lost rivers
and stream;
- Many kinds of wild mammals and birds would be negatively affected, especially its
habitat and movement. It would indirectly impact on the Virakchey National Park.
- 9.3 percent of Mekong River Basin’s fisheries and 6-8% of Mekong River Basin’s
sediment would be blocked
- Changing of hydrology, water flows and transportation of boats;
- Decreasing of water quality; especially water quality in downstream. In addition, water
pumped from the Stung Treng River would contain toxin which could affect serious
illness outbreaks amongst water users;
- Effecting on forestry and wild habitats; effecting on biodiversity in water and fisheries;
- Effects on culture resources and quality of life;
Note: Impacts caused by planned Lower Sesan 2 hydropower is just only from the assessment based
on the perception of local people and other involved stakeholders whilst Lower Sesan 2 hydropower
dam start to build in 2014.
Source: NGO Forum, 2009; Biard, 2009; Presentation by Trandem, 2013
34
Interviewed with NGO representative on 26 March 2013
Interviewed with official from Stung Treng provincial hall on 16 May 2013
36
Cambodia Daily Newspaper, http://www.cambodiadaily.com/news/construction-of-lower-sesan-dam-in-stungtreng-to-start-in-2014-5320/, (accessed on 08 January 2013)
35
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Chapter 4: Decision Making in Hydropower Development
4.1. Investment Process in Cambodia
RGC has been encouraging both Cambodian and foreign investment to Cambodia. As
shown in Figure 2, the process of investment was made easier by which the proposed
project goes through CDC acting as One-Stop-Shop and, on behalf of the investment
applicant, responsible for getting all required licenses from relevant entities as listed in the
Conditional Registration Certificate (CRC) (CDC, 2010). Since 1994, RGC has adopted and
amended legal instruments for the management of investment in Cambodia including “Law
on investment of the Kingdom of Cambodia in 1994”, “Law on the amendment to the law on
investment of the Kingdom of Cambodia in 2003”, and “Sub-decree No 111 ANK/BK on the
implementation of the law of the amendment to the law on investment of the Kingdom of
Cambodia in 2005”. As stated in the investment application procedure of CDC, in case of
discrepancy among the 3 legal instruments, the provisions of the Sub-decree 111 are
applied by CDC (CDC, 2010).
Figure 2: General Application Process of Qualified Investment Project (QIP)
1-Applicant submits investment
proposal with application fee
2a- If conform to review criteria issue
CRC within 3 working days after
submission date or deemed to be
registered
2-CDC review application
3-CDC assist CRC holder to obtain all
of the licenses from relevant ministriesentities listed in the CRC on behalf of the
Applicant within 28 working days after
the issuance of CRC
Approval
from COM
2b-If not conform to review
criteria, issue Letter of Noncompliance within 3 working
days or the application deemed to
be registered
Need approval from CM if:
- investment capital = or > USD 50M
- involve politically sensitive issues
- involve the exploration and the exploitation of mineral
and natural resources
- negative impact on the environment
- have long-term strategy or involve infrastructure
concessions on the basis of BOT, BOOT, BOO, or BLT*
4-Issue a Final Registration
Certificate within 28 working
days after the issuance of CRC
5-Commencement of the QIP
 Letter of Non-Compliance: clearly state the reasons why the Investment Proposal was not acceptable and the additional
information required for enabling the CDC or PMIS to issue a CRC (CDC).
 Final Registration Certificate (FRC): The document issued by the Council or the provincial/municipal Investment Subcommittee (Sub-Decree 111).
 Qualified Investment Project (QIP): an investment project for which a Final Registration Certificate has been issued
(sub-degree 111).
 Conditional Registration Certificate (CRC): specifies the approvals, authorizations, clearances, licenses, permits or
registrations required for the QIP to operate, as well as the government entities responsible to issue such approvals, etc.
Source: Authors
The applicant, both Cambodia and foreign entities, who wishes to have investment incentive
or investment guarantee or only each of them, have to go through the QIP approval process.
Article 5.1 of the sub-decree 111 states that the applicant has to submit to CDC the
Page-27-
investment proposal together with Application Form and pay 7 million KHR for administration
cost covering securing the approvals, authorizations, license, or registration from all relevant
ministries and entities including stamp duty (RGC, 2005).The applicant can also go through
Provincial-Municipal Investment Sub-committee (PMIS), if the project’s capital is no more
than USD 2 million; however, in case the project’s capital exceeds USD 2 million or it relates
to at least 2 provinces-municipalities or locates in special economic zones, the process has
to go through CDC (RGC, 2005).
Article 6.4 of sub-decree 111 states that after the receipt of the investment application, CDC
has three working days to review the investment application and issues the Conditional
Registration Certificate (CRC) to confirm the acceptance of the application or issue the Letter
of Non-Compliance (LNC) to inform the rejection. If CDC failed to do that within 3 working
days, the investment application is deemed to be registered, and in this case, CDC has to
issue the CRC to the applicant immediately (RGC, 2005). However, in practise, issuing CRC
always takes more than 3 working days, and, according to article 6.1 of sub-decree 111, the
date of issuing this certificate can be postponed for the investment that relates to the national
interest or the project that are environmentally sensitive. One important piece of information
among other provisions stated in CRC is the list of required documents such as approvals,
authorizations, licenses and permits or registrations required for the QIP to become lawful,
while the LNC states the reasons why the Investment Proposal was not acceptable and the
additional information required for enabling the CDC to issue a CRC (CDC, 2010).
As stated in article 7.1 of sub-decree 111, after issuing CRC to the applicant, CDC has
responsibility to assist CRC holder to obtain all of the licenses from relevant ministriesentities listed in the CRC as stated above on behalf of the CRC holder within 28 working
days after the issuance of CRC. However, in practice, QIP applicant is expected to obtain
such authorizations, license or registrations (CDC, 2010). Article 7 of the sub-degree further
adds that if the CRC holder did not obtain all of the required documents within 28 working
days from date of CRC issuance, CDC must issue a Final Registration Certificate (FRC).
Considering this process, it seems that the project can be approved even before the
completeness of the required documents. However, there actually is the punishment for
being late of processing these documents. All government institutions that are responsible for
issuing the required documents as stated in the CRC who, without proper reason, fails to
provide those documents to the CRC holder’s request on time will be punished by law (RGC,
2003).
Sub-decree 147 on the organization and the function of the Council for the Development of
Cambodia in 2005 outlines the mandate CDC regarding the decision making to issues the
FRC. Article 11 of this sub-decree states that CDC needs the approval from the Council of
Ministers for the investment project that:





have investment capital equal of or more than USD 50 million
involve politically sensitive issues
involve the exploration and the exploitation of mineral and natural resources
may have negative impact on the environment
has long-term strategy; or involve infrastructure concession on the basis of BOT,
BOOT, BOO or BLT (CDC, 2010).
With the FRC, the proposed project, according to article 2 of Investment Law, becomes the
QIP. The commences date of the QIP is the date of issuance of the FRC, and same date of
the commencement of Trigger Period for the Tax on Profit Exemption to be provided to the
project.
Page-28-
4.2. Main Existing Regulation Concerning Hydropower Project in Cambodia
Until now, there is no direct law on hydropower development in Cambodia yet, only relevant
articles within other laws related to energy, the environment, and agriculture have found.
Moreover, there is no EIA law; at the time of writing, the law is the drafting process. The
following are summary of related law currently in effect to contribute hydropower decision
making process in Cambodia.
Table 8: Law and Regulations Relevant to Hydropower Development Cambodia
Law/regulations
Relevant articles
- Law on investment of
- These laws define the required process so that an
the Kingdom of
investment project can legally start operating in Cambodia
Cambodia in 1994 and
though CDC’s registration process and the approval from
the Law on the
related governmental institutions
amendment to the law
- The law also stated about the required legal document and
on investment of the
approval or permit from relevant technical ministries for the
Kingdom of Cambodia in
project to be approved by CDC including EIA study, water
2003
license and so on.
- Sub-decree No 111
- It is noted that even though the sub-decree 111is lower in it
ANK/BK on the
power than these 2 laws, the government in practice,
implementation of the
depend on the Sub-decree to interpret any differences
law of the amendment to
among these 3 legal documents (CDC, 2010).
the law on investment of
the Kingdom of
Cambodia in 2005
- Sub-decree 11 on BOT - This Sub-decree legalize the State or public legal entities to
Contract 1998
cooperate with private legal entities on such infrastructure
projects as Electricity power plants, roads and highways for
vehicles, ports, telecommunication networks, railroads,
residential development, hospitals, schools, airports,
stadiums, tourism resorts, new cities, hydropower stations,
dams, factories, clean water production plants and solid
waste processing. The maximum period of infrastructure
project is 30 years, but it is extendable.
- This sub-decree gives the government flexible way to get
through the investment process with investor. The selection
of concessionaire can be done through international or
national “open or close” bidding process or through
negotiation process.
- Land Law 2001
- Land Law states that land ownership is protected and no
one can be deprived of their ownership. The law recognizes
- Law on Expropriation
the right of indigenous communities to collective ownership
2009
of these lands (Art 26). However, this law gives way to the
government to expropriate properties in the public interest.
- Furthermore, in 2010, Cambodia adopted an Expropriation
Law which widened the way for the RGC to legally
expropriate public and private properties for project’s that
serve the national and public interest. The government can
still expropriate property even if there are unresolved
disputes; however, property owners can continue to
challenge the expropriation, or the compensation they
received, in the courts (Art 19, 34).
- However, Expropriation Law establishes processes and
mechanisms for expropriation implementation aiming at
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- Sub Decree On Social
Land Concessions
(2003)
- Sub-degree on
Environmental Impact
Assessment Process
1999
- Law on Environmental
Protection and Natural
Resource Management
1996
- Sub-decree on Water
Pollution Control 1999
- Sub-decree on Solid
Waste Management
1999
- Sub-decree on Air
Pollution Control and
Noise Disturbance 2000
- Law on Water Resource
Management 2007
- Royal Decree on the
Protection of Natural
Areas 1993
ensure that the expropriated properties will be compensated
at market price when the expropriation is declared.
- The sub-decree defines the criteria, procedures and
mechanism for the granting of social land concessions for
residential use and/or family farming.
- The maximum size of social concession land granted for
residential purposes is one thousand two hundred (1,200)
square meters, except in rural areas where land is available,
the size of social concession may be increased up to three
thousand six hundred (3600) square meters (Art. 16).
- The maximum size of social concession land granted for
family farming purposes is two hectares, but for some areas
the size of social concession land may be increased up to
five hectares based on the characteristics and potentiality of
the land or the type of crop, and labor (Art. 17).
- This sub-decree is the require hydropower project with
installed capacity of at least 1M to conduct initial or full EIA
study. A full scale EIA should be conducted for projects
deemed to have a serious impact on natural resources,
ecosystems, health or public welfare (Art 8).
- This Sub-decree raises the importance of public participation
in the EIA process. This Sub-decree put MOE on the
responsibility to evaluate and review EIA reports with other
relevant ministries. Moreover, MOE is also responsible for
monitoring and take appropriate action to ensure that EMP is
followed properly (Art 3).
- The law on Environmental Protection and Natural Resource
Management 1996 also raises about EIA as saying that “An
environmental impact assessment shall be conducted on
every project and activity of the private or public, and shall
be approved by the Ministry of Environment before being
submitted to the RGC for decision (Art 6).
- The Sub-decree on Water Pollution aim at regulating the
water pollution control in order to prevent and reduce the
water pollution of the public water areas so that the
protection of human health and the conservation of
biodiversity should be ensured.
- The objective of Sub-decree on Solid Waste Management is
to regulate the solid waste management with proper
technical manner and safe way in order to ensure the
protection of human health and the conservation of
biodiversity.
- The purpose of this Sub-decree on Air Pollution Control and
Noise Disturbance is to protect the environmental quality
and public health from air pollutants and noise pollution
through monitoring curb and mitigation activities.
- This Law is intended to ensure the effective and sustainable
management of the water resources to attain socioeconomic development and the welfare of the people (Art 1).
- This law requires the development related to water to ask
water use license from MOWRAM.
- The Royal Decree assigns aims at managing and
supervising the development and protection of natural areas,
including the protection of environment, land, forestry,
Page-30-
- Protected Areas Law
2008
- Forestry Law 2002
- Electricity law 2001
wetland and coastal areas.
- The Royal Decree outline certain areas as protected areas
including
Natural Parks, Wildlife Preserves, Protected
Scenic View Areas, and Multi-purposes Areas
- The law divides protected areas into 4 zone type: core,
conservation, sustainable use, and community (Art 4)
- The law states that all kinds of clearance and development
in the core and conservation zones is prohibited (Art 36),
and the developments activities within or adjacent to
protected areas require EIA (Art 44).
- This law aims to ensure the sustainable management of
forests and their social, economic and environmental
benefits, including conservation of biological diversity and
cultural heritage (Art 1).
- The law also suggests for the public participation in any
government decision that has the potential for heavy impact
on citizens, livelihoods of local communities and forest
resources, and those activities in forested areas which likely
have negative impact on society and environment should be
subject to an EIA study (Art 4).
- This law recognizes traditional user rights of the people
whose livelihood depend on non-timber forest products from
the forests for the purpose of traditional customs, beliefs,
religions and livelihood (Art 40).
- The purpose of this law is to manage and to prepare a
framework for the electric power supply and services in
Cambodia (Art 1).The established principles of this law are
(1) the protection of the rights of consumers to receive the
reliable and adequate supply of electric power services at
reasonable cost, (2) the promotion of private ownership on
the facilities for providing electric power services, and (3) the
establishment of competition wherever feasible within the
electric power sector
- From this law, the EAC was established as a legal public
entity working as an autonomous agency to regulate the
electricity services and to govern the relation between the
delivery, receiving and use of electricity (Art 6)
Source: Compiled by author based on various related regulations
4.3. Hydropower Investment Process
Conforming to the description in investment process section, hydropower project could be
invested by both foreign and local private and public sectors in Cambodia. The investment
process needs to go through the registration with CDC and require the approval from COM.
The government is the party to initiate hydropower project by listing out the potential site
across Cambodia. As shown in the National Sector Review of Hydropower made by MIME in
2003, 60 possible sites of small and large hydropower across Cambodia was identified on
Mekong Mainstream, its tributaries and in the South-western coastal area. Among those
potential, 14 projects were also prioritized (MIME, 2003). As explain by official from MIME,
Cambodia is in need of electricity development, but the country has been a cash-strapped
countries and lack of other necessary resources for hydropower development. Therefore,
Cambodia needs involvement from private sector37.
37
Interviewed with representative officer of MIME on 23 August 2013
Page-31-
There is no clear guideline that there has to be bidding for the hydropower project so that the
winner gains the right to work on initial works like feasibility study. The investor can come
and ask permission (MOU with MIME) from to conduct feasibility and EIA study of any
potential hydropower project identified by the government38 during a period of 2 years
(Suhardiman et al., 2011). As defined in the Appendix of sub-decree on EIA (1999), initial or
full EIA is required for hydropower project with the capacity of at least one MW (sub-decree
on EIA, 1999), and the article 8 further states that full EIA is required if project tends to cause
a serious impact to the natural resources, ecosystem, health and public welfare. The result of
the studies are submitted to and discussed among the inter-ministerial committee which is a
mechanism to evaluate the project in all of its aspects. This committee comprises of MIME as
the chair, MOWRAM as vice chair, and MOE, MLMUPC, MPWT as member. If any rejection
is raised by only one of member, the project cannot continue39.
When the proposed hydropower project is approved by Inter-ministerial Committee, MIME,
then invites the project proponent to the discussion to develop the hydropower project;
however, MIME can choose other partner, beside the one conducting the initial studies, to
develop the project. In this case, the cost of the studies will be reimbursed to the former
company by the company newly selected (SAWAC, 2011). During this phase, the project
proponent can start registering their business investment with the CDC40 with the support
from its host ministries MIME in collecting all necessary required documents (RGC, 2005).
CSOs show their suspicious about the process of selecting the dam investor basically refer
to the bidding process. It is only the Kamchay hydropower project which as heard to be was
opened for international bidding in 2004( SAWAC, 2011). The bids was participated by 17
local and international bidders (Carl Middleton and Sam Chanthy, 2008), and the winner is
Sinohydro which is granted with the build Kamchay hydropower dam and conduct EIA study
(SAWAC, 2011). However, for the case of LS2 dam, there is no sign in public that there was
bidding to select the investor or the company to conduct the study for the project. The known
fact related to this investment is that Cambodian and Viet Nam began discussing about the
project in 2006 about the possibility to build the dam (Bank Track, 2011); later on, MOU was
made with EVN to conduct the feasibility and EIA study followed by the establishment of the
joint venture between local (Royal Group) and Vietnamese (EVN) investor (KCC, 2009).
Even though it is found that the selected priority project is opened for public bidding
(Suhardiman et al., 2011), bidding process is not the only way to get hydropower process
approved in Cambodia. Being without bidding does not mean that hydropower project is
against the existing regulation of Cambodia. So far there are four medium and
large41hydropower dams (Kirirom I, Kirirom III, Kamchay, Atay) in operation and other
medium and large dams under construction (Tatay, Lower Stung Russei Chrum), which were
all done under the BOT42 agreement with investors from China. According to the official from
Member of Parliament of Cambodia, the reason that the RGC chooses BOT basis is that at
the moment the country is not able to do the project by itself because of the lack of financial
and technical resources43.The selection of concessionaire for BOT is defined by sub-decree.
Article 2, 3 and 4 of sub-decree 11 states that BOT investment can be done only when the
Principal is state or public legal entities and the Concessionaire is private entities on such
investment project like electricity power plants, hydropower stations, and dams with the
38
Ibid
Ibid
40 Interviewed with representative officer of MIME on 23 August 2013
41 According to MIME (2003): hydropower dam with installed capacity =<500kw is “Micro”; 501-5,000kw is “Mini”;
5,001-10,000kw is “Small”; 10,001-50,000kw is “Medium”; =>50,000kw is “Large”
42 BOT project is a concession contract in which a Principal, grants a concession to a Concessionaire who is
responsible for the construction and operation of a facility over the period of the concession before finally
transferring the facility, at no cost to the Principal, as a fully operational facility (Article 1, Sub-decree 11, 1998)
43 The official from Member of Parliament of Cambodia said during the NA session on 15 February 2013
39
Page-32-
maximum period of extendable 30 years for infrastructure project. According to article 9 of
this sub-decree, the selection can be done through international or national “open or close”
bidding process. However, negotiation procedure can be used if [1] the bidding process was
not successful; [2] the project contains necessary specifications requiring the selection of a
special concessionaire; or [3] the special criteria for the infrastructure project require qualified
concessionaire to meet these special criteria (RGC, 1998). The negotiation process
stipulated in the sub-decree is understood to give the government legitimacy in dealing with
project without bidding if the government claims that the project the project at least fall into
one of the three conditions.
Figure 3: Investment Process of Hydropower Project
Source: Author
The proposed project is approved by the government of Cambodia through an interministerial meeting at Prime Minister’s Office and followed by signing of 2 important
documents: Implementation Agreement (AI) with MIME and MEF, and Power Purchasing
Agreement (PPA) with EDC44 (Suhardiman et al., 2011). These 2 documents will help the
investor to borrow money from any interested Bank, as usually the investor at these stages
do not have the whole budget of the project’s budget45 .
Finally, the RGC guarantees the investor over financial loss, by asking the National
Assembly to adopt the Law of Guarantee of Payments. In the case of LS2 hydropower, the
government is responsible to pay the amount of money or debt owed by MIME or EDC to the
dam investor following the agreed upon Implementation Agreement if these two institutions
cannot pay (RGC, 2013). The opposition party did not agree on the guarantee saying that the
investment cost is huge almost a third of the then national budget of Cambodia. Moreover,
the agreement provides more power to investor; for example, if the conflict rises up in the
payment guarantee, the solution will be made in Singapore court, not in Cambodia, and there
is not enough space and time for discussion to ensure that the decision making on
44
45
Interviewed with representative officer of MIME on 23 August 2013
Ibid
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hydropower project is for the benefit of the people and the people will not be harmed46. The
notion of financial risk to guarantee the LS2 is also shared by ADB’s official that it is a risky
move as the Government does not have the risk forecast capacity; the government should
start from smaller project and smaller risk47.
The whole process of hydropower investment was alleged by civil societies for being
corrupted and irregular. Civil societies alleged that the investor firstly has to meet senior
officials to gain their support for the investment proposal and then there is an intermediary
(usually they are influential and work on commission) to facilitate the investment process
through all stage with line ministries and institutions, and in this case CDC only receive the
documents and approve48. This notation was also express by Member of Parliament of
Cambodia that intermediary are mostly the relatives of the powerful who works confidentially
to get license without bidding or required experiential procedure and sometime it takes them
only one day to get the work done49. Moreover, senior political figures were also found to
have significant influence on such high profile project as dam, which could influence relevant
ministries’ decision making processes. As raised by Middleton (2008) that the way the high
level Cambodian politician express their support to the hydropower project are used by all
related governmental institution as instruction on how the decision should be made within
their own authorities (Carl Middleton and Sam Chanthy, 2008).
The enforcement of EIA regulation is under strong critics by CSOs in term of quality50 and its
importance considered by government side (ICEM, 2003). EIA is generally seen as
complement to the project approval, not an important documents for project decision
making51. The case of Kamchay hydropower dam is an example where the BOT agreement
was signed in February 2006, while the draft Initial EIA was completed in October 2006; and
moreover, the full EIA report was completed in 2011 the same year the dam is completed
after years of construction.
4.4. EIA Approval Process in Cambodia
Cambodia has not yet had EIA law. At the time of writing, the draft EIA law is on its way
through series of consultations among civil societies and communities to bring public
concerns and recommendations to contribute to the draft law. Cambodia depends on two
main legal documents: [1] Sub-decree 72 on the Environmental Impact Assessment Process
1999, and [2] The Declaration on General Guideline for Preparing IEIA/EIA Report. Other
relevant regulations are [1] Law on Environmental Protection and Natural Resource
Management (1996), [2] Sub-decree on Water Pollution Control (1999), Sub-decree on Solid
Waste Management (1999), Sub-decree on Air and Noise Pollution Control (2000) 52.
As raised by the official from MOE in 2012, less than 10% of around 2,000 main development
projects in Cambodia like dams, roads and bridges which was approved by RGC over a period
from 2004 to 2011, were implemented with the EIA studies53. Article 72 of the Sub-decree 72
states that every proposed and ongoing project(s) and activities—by private, joint-venture or
state government, ministry, institutions—that match the criteria stipulated in the annex of
46
According to the official from the member of parliament of Cambodia on 15 February 2013
Cambodia Daily Newspaper, Regional Bank, IMF Note Risks to Government’s Dam Guarantee,
http://www.cambodiadaily.com/archive/regional-bank-imf-note-risks-to-governments-dam-guarantee-11269/,
(accessed 10 July 2013)
48 Interviewed with NGO representatives on 19 March 2013
49 Interviewed with Member of Parliament of Cambodia on 10 April 2013
50 Interviewed with NGO representatives on 13, 16, 19 March 2013
51 Interviewed with NGO representatives on 19 March 2013
52 Presentation by Duong Samkeat, MoE’s official, on 16-17 July 2009 at Royal University of Phnom Penh
53
An official from MoE as quoted by the Cambodia Daily Newspaper, November 25, 2012;
http://www.cambodiadaily.com/news/few-companies-conduct-envir, (accessed on 5 November 2013)
47
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sub-decree, are under the scope of the sub-decree, meaning that IEIA/EIA is needed, except
special case that a project will be approved by the RGC (RGC, 1999).
Article 6.4 of Sub-decree 111on the investment process in Cambodia states that the
Conditional Registration Certificate (CRC) issued to applicant during investment registration
process requires such documents as license, authorization, registration etc. from relevant
ministries and institutions (RGC, 2005). These documents include the Environmental Impact
Assessment Report which is to be approved by MOE (BNG, 2010). Article 6 of Sub-decree
72 adds that the investment applicant is responsible for conducting EIA study and
establishing the draft report (RGC, 1999); but, in practise, the Project Owner (PO) hires EIA
consulting company to conduct this study. The selection of this consulting company is done
through bidding organized by the project owner or, in most cases, through the introduction by
MOE. In the latter case, MOE plays roles like an intermediary to connect PO and EIA
consulting companies54. The duration of conducting the EIA study varies depend on the
scope of the project; but, it is noted that the duration of field data collection is defined by the
MOE. The duration can be as short as one month, and to start field data collection, there
must an official permission from MOE55.
Upon the completion of EIA study, dozen copies of draft IEIA/EIA reports are to be submitted
to MOE and relevant ministries56 including the Project Approval Ministry or Institution57
(PAMI); and as stated in article 7,14,17 of Sub-decree 72, the feasibility study report is also
required to be submitted to MOE. According to article 8, 16 of Sub-decree 72, in case the
project possibly causes serious effect on health, public welfare, and natural resources, MOE
would require PO conduct full EIA study and re-submit the draft report to MOE through the
reviewing process again. Upon receiving Feasibility Study (F/S) report and IEIA report, MOE
need to feedback within 30 working day (Article 15, Sub-degree 72). During the 30 working
days, MOE conducts IEIA reviewing process including internal and inter-ministerial reviews
and feedback to PO(article 11, sub-decree 72).Technical officials at EIA Department of MOE
start visiting the project site and provide comment to the draft report within 10 working days,
followed firstly by MOE’s intra-department meeting for 5 working days, secondly, MOE’s
management meeting for other 5 working days, and finally other 5 working days of interministerial meeting chaired by H.E. Senior Minister of Environment with participations from
related Ministries/Institutions, local authorities, NGOs, and other related individuals (Article
11 of General Guideline for Preparing EIA report, 2009). Be noted that comments from each
review needs to incorporated in the report and the new version of the report will be presented
in the next review workshop58.
Figure 4: EIA Approval Process in Cambodia
54
Personal communication with EIA consulting company on 03 May 2012
Ibid
56 Ibid
57
PAMI is the ministries or institution directly responsible for the project with the project owner
58 Personal communication with EIA consulting company on 03 May 2012
55
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Source: author, 2013
After the 25 day reviewing, MOE has 5 working days to send official letter to agree with the
IEIA/EIA or inform that revision is needed; if the report needs revision, MOE will re-comment
the revised report within other 30 working days after the date of submission of the revised
report. The letter to approve IEIA/EIA is sent to PO, PAM/I, and CDC (article 13 of General
Guideline for Preparing EIA report, 2009; Article 15 and 18 of sub-decree 72). For CDC, we
observed, the deadline of reviewing by MOE is important and compulsory. Condition is
inserted to ensure the report is commented or approved on time. If MOE fails to feedback the
findings and recommendations within 30 working days upon the time CDC receives
application from PO, the PAM/Iis able to assume that the criteria of the sub-decree is
compiled by the (revised) IEIA or EIA report (Article 15 of sub-decree 72,). Within 6 months
after the confirmation from MOE that the EIA report is compliance with the criteria of the subdecree on EIA, PO must implement EMP (Article 23, sub-decree 72).
Critic of EIA Approval Process in Cambodia
In 2003, International Center for Environmental Management (ICEM) reported that EIA process
was low in performance. The EIA system is seen to be ineffective because of 3 factors: [1]
limited capacity and resources of EIA Department of MOE; [2] the weak interaction among
related departments within the MOE and with related agencies, and [3] the low priority given by
all relevant government’s institutions to EIA process (ICEM, 2003).
According to initial Key Informant interviews, it is generally heard that, especially from CSOs,
the EIA approval process in Cambodia is still limited; the main problem claimed by all of the
interviewed NGOs is the quality and reliability of EIA report because of the fact that EIA
process lack of participation. Consultation which is one of the EIA requirements has not been
fully or properly conducted in Cambodia59. The contents of the report, for example, are
similar among various EIA reports which mean that it is apparently copied from one report
and pasted to the others60. However, the interviewed NGOs acknowledges that NGOs’
representative and the representative from community are allowed to participate the interministerial meeting organized by MOE which is chaired by Minister of Environment to
59
60
Interviewed with NGO representative on 19 March 2013
Interviewed with NGO representative on 16 March 2013
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comment on the final draft of EIA report; but they are informed too short before the date of
the meeting. Usually the government gives them around 3 to 5 days during which NGO
Forum on Cambodia has to manage to organized meeting among them their network to
discuss the very thick EIA report full of technical information to bring comment back to the
government. Together with the limited access to information on EIA, CSOs cannot well
contribute to the report. Moreover, with the lack of monitoring activities from those NGOs, it is
hard to say that the government consider and integrate their comment into the report or not61.
In Cambodia, it seems that EIA is only the complement tools for only making the project
approved, not for rejecting the project62. There are many factors which create this perception
and situation. Firstly, it seems that the government use this EIA process as a tool to attract
more investor; more investment mean more job creation; secondly, there exists the
corruption and the limited capacity of implementing agency (MOE); thirdly, it understandable
that EIA process can be influenced by a small number of high ranking official in Cambodia
through the top-down decision making by their spoken-out commitment and strong support to
the proposed project63 .
4.5. Key Institutions Involve in Hydropower Decision Making
Regarding hydropower decision making, there are key actors who make decision, enforce
the decision and advocate the process of the decision. At national level, National Assembly
is the top institution to approve financial guarantee for investor and other inter-related such
institution/ministries as COM, CDC, MEF, MIME, MOWRAM, MOE, EAC, CNMC, and other
institution in provincial, district and commune and local level as follows:
National Assembly (NA)
NA possesses legislative power to pass a vote of confidence in the RGC by an absolute
majority vote of all Members. The role of NA has the authority to approve the national
budget, state planning, loans, financial contracts, and creation, modification, and annulment
of taxes (Article 90(new) of Cambodian Constitution). In Cambodia, NA is seen to approve
the law for guarantee of payments for hydropower projects. Even though there many in kind
and in case incentives to encourage investors to come to Cambodia; however, there is not
any clear clause or guideline in Cambodia’s regulations that the government has to request
the NA for guarantee of payment for such investment as hydropower project, while the
Cambodia has done for several hydropower project already.
On February 21, 2013, the government has signed 13 payment guarantees to investors in
energy sector including coal-fired power plants and hydropower dams in Cambodia. He
added that “It is the government’s obligation to do a guaranteed payment for investment
companies whenever Electricite du Cambodge miss a payment or don’t pay the bill.”64 For
example, the financial guarantee law for LS2 was set to be approved on February 15, 2013.
On the day, the Member of Parliament’s official requested for the postponement of the
approval because [1] the affect is huge and needs experts including NGOs working in this
area to get involved in a more detailed assessment of EIA, [2] related documents were
provided his party too late (the Member of Parliament’s official just got the project document
in the morning of the approval date); [3] the implementation agreement (IA) and buy-sale
agreement of the project are not available to the opposition MP; [4] lack of participation from
61
Ibid
Interviewed with NGO representative on 19 March 2013
63 Ibid
64 Cambodia Daily Newsletter, Government Has 13 Payment Guarantees for Energy Projects,
62
http://www.cambodiadaily.com/news/government-has-13-payment-guarantees-for-energy-projects11377/, (accessed on 13 August 2013)
Page-37-
affected people; only the positive facts reported65. In spite of strong request from opposition
party, the approval went easily on the day.
The Council of Ministers (COM)
COM is the top executive organ of the government which is elected for 5 year terms by the
NA. It serves as the administrative nerve center of the government, whose work are to
prepare, facilitate, coordinate, unify, and guide all activities of individual ministries and local
government (Suhardiman et al., 2011). For large scale, sensitive and important project such
as hydropower electric project, the decision making will be covered by COM. The CDC shall
submit for the approval from the COM for the investment projects that fall into one of the
following conditions66:






Investment capital of USD 50 million or more;
Politically sensitive issues;
The exploration and the exploitation of mineral and natural resources;
Possible negative impact on the environment;
Relevant to long-term strategy; or
Infrastructure concession
The Council for the Development of Cambodia (National Level)
The CDC is the sole and One-Stop Service organization responsible for the rehabilitation,
development and oversight of investment activities including the evaluation and the decision
making on all rehabilitation, development and investment project activities67. Nevertheless, it
does not necessarily mean that all investment has to go through CDC system. In Cambodia,
the investment process can be also done through the mechanism in each province and
municipality. Investment project with the capital no more than USD 2 million can be
processed through the registration with Sub-Committee on Investment of the ProvincesMunicipalities. CDC/CIB (Cambodia Investment Board) will be responsible for the registration
for the project’s capital exceeds USD 2 million or if the project locates in the authorities of at
least two provinces-municipalities or in special economic zones68. For this reason, by
considering its trans-boundary impact and the amount of investment, the hydropower
investment project has to go through CDC/CIB system.
Ministry of Industry, Mine and Energy (MIME)
MIME is an important ministry responsible for setting and administrating the government
policies, strategies and planning in the power sector69. The ministry has its mandates and
responsibilities including but are not limited to the research on the hydropower distribution
networks and the estimation of the potential for the electrical projects development in case
the project main purpose is electricity. In addition, the ministry also play role in monitoring
existing hydropower dams70. MIME is the MoU signatory with investor to conduct feasibility
study of any possible hydropower development project and acts as the primary focal point for
hydropower developers who are interested to invest in Cambodia (Middleton, 2008:19).
Within the ministry, the Department of Hydropower is the main division dealing with studying,
developing and implementing hydropower development. The department roles include71:
65
The address by the Member of Parliament’s official on 15 February 2013
Article 11, “Sub-Decree No.147 on the Organization and Functioning of the Council for the Development of
Cambodia
67 Article 3 of the Law on Investment of the Kingdom of Cambodia1993
68 The sub-decree 17 on the Establishment of the Sub-Committee on Investment of the Provinces-Municipalities
of the Kingdom of Cambodia issued in 2005
69 Article 3 of electricity law of Cambodia 1993
70
The Sub-decree on the Organization and Functioning of the Ministry of Industry, Mines and Energy (1999)
71 http://www.wepa-db.net/policies/structure/chart/cambodia/doh.htm, (accessed 20 September 2013)
66
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 developing and implementing the national policy of electric power including low cost
of electric power utilization, effective uses and making electricity available in most
urban and rural areas;
 collecting, analyzing, maintaining and utilizing data for study, and developing hydroelectric power in potential areas with sound environment; and
 developing and implementing the action plan of hydro-electric power development
throughout the country, including its monitoring program. In the case of the
Kamchay Dam, (Middleton, 2008:19) MIME is the ministry that was responsible for
bidding process in 2004 and worked with the bid winner by facilitating the project on
behalf of the government.
MIME in partnership with Ministry of Economy and Finance (MEF) is the owner of the
Electricite du Cambodge (EDC) (WB, 2006:8).
Ministry of Environment (MOE)
MOE possesses the significant power and authority for the protection the natural resources
and the prevention of environmental degradation in the country. MOE is the only main
ministry to review EIA of every private and public project before the projects are submitted
decision making from RGC. MOE has the responsibility as follows:
 scrutinize and review the report of the Environmental Impact Assessment in
collaboration with other concerned ministries;
 follow up, monitor and take appropriate measures to ensure a Project Owner will
follow the Environmental Management Plan (EMP) while project construction is
taking place and accede to their EIA report's approval (Article 3, sub-decree 72).
The Project Owner has to acknowledge the findings and recommendations to the EIA report
in which have been approved by the MOE, proceed with further implementation (Article 4,
sub-decree 72). In term of monitoring, MOE has the right to co-operate with other line
ministries/institutions to halt all projects’ existing/ongoing activities which failed to accomplish
the EMP, stated in the approval of their EIA report (Ibid).
Ministry of Water Resources and Meteorology (MOWRAM)
Article 5 of Water Law of the Kingdom of Cambodia states that MOWRAM is mandated to
manage, lead and supervise the implementation of the Law in cooperation with ministries
concern or a join commission shall be set up in case of need to settle and coordinating works
and activities among those ministries. MOWRAM (Middleton, 2008) is responsible for the
overall management of surface and ground water resources in Cambodia. There is one
department namely the Department of Water Resources Management and Conservation of
MOWRAM that oversees the ministry’s main function in relation to hydropower development
which includes issuing licenses for water use and water works construction, monitoring the
compliance from the project owner, and imposing water user fees (Suhardiman et al., 2011).
Article 4 of the law states about Integrated Water Resources Management (IWRM), which
means that in cooperation with other relevant agencies, water and water resources need to
be considered for an effective and sustainable water use for human being, environment and
other sectors. Further, article 17 also states about the power of MOWRAM to modify,
suspend, or cancel water license if there is the violation against the condition stipulated in the
license, or if the water use cause negative impact on public health or the environment.
Ministry of Economic and Finance (MEF)
MEF is responsible for performing the guidance and administration of the economy and
finance of the Kingdom of Cambodia to support socio-economic development in the context
of free market and social equality. The ministry’s functions and duties widely cover the
economy and finance sector which also include the participation in the formulation of policy
Page-39-
and management of investment, and the collection of tax revenues and non-tax revenue and
deposit them in public accounts72.
In the case of Kamchay hydropower project, MEF is one of the members of the InterMinisterial Negotiation Committee assigned to discuss on technical and financing documents
and the contract negotiation. Furthermore, in cooperation with MIME, the MEF is responsible
to work on Implementation Agreement and Sale-Purchase Agreement of electricity of the
hydropower project73. MEF in cooperation with MIME is the cosignatory of BOT contract after
authorized by official letter from the Prime Minister (Middleton, 2008:56), and is also the
owner of ECD74. With regard to compensation and resettlement caused by hydropower
development, there is one inter-ministerial committee namely “Inter-Ministerial Resettlement
Committee (IRC) under MEF that is responsible for addressing resettlement issues,
approving compensation rate, and other relevant issues. This leads to the issues of
impartiality of its decision because MEF is also a key ministry which encourages
development including hydropower (Suhardiman et al., 2011:54).
Electricity Authority of Cambodia (EAC)
EAC was established under Electricity Law of the Kingdom of Cambodia in 2001 for
regulating the electric power services (Article 2, Electricity Law 2001). The authority is a legal
public entity authorized by the government to be an autonomous agency to regulate the
electricity services and to govern the relation between the delivery, receiving and use of
electricity (article 6, Electricity Law 2001). Its main duties includes, but not limited to the
issuance, revision, suspension, revoke or deny of the licenses for the supply of electricity
services (Generation License, Transmission License, Bulk Sale License…), and the approval
of tariff rates and charges and terms and conditions of electric power services of licensees,
except the case of the pursuant to a competitive, market-based process judged by the
authority. Moreover, the authority can also review the financial activities and corporate
organization structure of licensees in case these activities and organization directly affect the
efficiency of electricity supply was well as the power sector’s operation (article 7, Electricity
Law 2001).
Cambodia National Mekong Commission (CNMC)
CNMC is the government institution of Royal Government of Cambodia established to
coordinate management, protection, conservation and development of water and other
related resources in the Mekong River basin with crucial roles in coordinating framework to
ensure effective implementation of 1995 Mekong Agreement, and to prepare and implement
related project and program of MRC under the Sustainable Development Framework of
water and related resources in the basin75. The commission is (Suhardiman, 2011:68)
coordinates related ministries in Cambodia and connects them to the regional levels. CNMC
is chaired by Minister of Water Resources and Meteorology.
Provincial Hall and Lower Authorities
In hydropower development project, provincial hall does not involve in technical works. Its
role is to be responsible for managing and leading the assigned commission work on
compensation and resettlement issues including the budget to support the committee to
work. During the feasibility study and impact assessment phase, provincial hall facilitate and
issue the permit for consultant companies to conduct the studies. The results of the studies
are to be disseminated to related stakeholders through workshops76.
72
Ministry of Economics and Finance, http://www.mef.gov.kh/about-ministry.html, (accessed 18 June 2013)
Inauguration speech by Prime Minister during the Kamchay inauguration ceremony on November 7, 2011 in
Kampot province
74 The presentation by Chea Piseth, from Hydro-electric department of General Department of Energy, MIME,
July 2009
75
Cambodia National Mekong Committee, http://www.cnmc.gov.kh/, (accessed on 13 July 2013)
76 Interviewed the official from Stung Treng provincial hall on 7 April 2013, Stung Treng province
73
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In Kamchay case, the provincial hall work through the subordinate institutions including
district and commune office to monitor the impact as well as any incident happening during
and after dam construction77. Both in LS2 and Kamchay cases, through lower government’s
institution including district and commune, provincial hall try to understand the concern of the
people and suggestion for planning and designing the compensation and resettlement78.
The lower administration institution including district and commune office are seen facilitate
any related activities in their localities. The common problem of the 2 offices is that they
cannot perform and represent the voice of the people well in hydropower dam issues, as
claimed by local people that they are order to work on the proposed project and they are also
under pressure from their higher boss.
Table 9: Roles of Local Authorities
Local Authorities
Role
District Office
In hydropower case, both district and commune official are all invited
to the workshop at provincial hall. District does not play role as the
channel through which information can be accessed to commune.
During the workshop at provincial level, communes are directly
assigned with tasks by provincial office79. During feasibility study and
EIA stages, district office has the role to assist the study team on
behalf of the government to collect information in the area through
informing communes and the people.
Commune Office The same as district office, commune has the role to assist the
delegates or study team who come to the area by informing their
people to cooperate with. But as commune is close to the people, they
has responsibility to gather all of the people concern and requests
through commune’s meeting and bring them to provincial meeting80.
Provincial Departments
As the arms of their respective ministries in Phnom Penh, all provincial departments play
roles as local institution working on their related issues in each province. In such mega
project as hydropower dam, all provincial departments are seen to just follow the planned
activities or policy from the ministries’ teams at national level. The provincial department
does not have power in such mega project. They are has participated in consultation meeting
during which they raised concerns about the possible impact on their sector; they even
raised the comment and suggestion regarding the function and alternative design of the
proposed dam, but there is not guarantee that their comments and suggests are to be
accepted and integrated in the project; everything will depend on the decision by their
ministries81.
Table 10: Roles of Provincial Departments
Department
Roles
Provincial Department
Among the interviewed Provincial Departments like PDOIME,
of Industry, Mine and
PDOWRAM, MOE, PDA, PDOT in Stung Treng and Kampot
Energy (PDOIME)
provinces, PDOIME is the only leading department that closely
cooperates with the hydropower investment companies during
77
Personal communication with Mak Prang commune on 16 February 2013, Kampot province
Personal communication with Pluk commune chief on 14 May 2013
79 Personal communication with Sesan acting district on 8 April 2013
80 Meeting with Pluk commune on April 08, 2012, Stung Treng province
81
Interviewed with the official of provincial departments in 2013 in Stung Treng and Kampot provinces
with Pluk commune on April 08, 2012, Stung Treng province
78
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Provincial Department
of Water Resources and
Meteorology
(PDOWRAM)
Provincial
Department of
Environment (PDoE)
Provincial Department
of Agriculture (PDA)
all stages including feasibility study, EIA study and the
construction of dams82.
PDOWRAM the main institution dealing with water development
issues was found to play less important role and does not has
much influences on any decision making regarding the
hydropower development. As stated by Stung Treng
PDOWRAM, this organization is rarely invited to join meeting
with PDOIME and the company representative. Therefore, only
less information is aware concerning the hydropower
development83. There is actually the case that the ministry is
invited to join the meeting regarding designing of the
hydropower, during which the department raised the concern
over water for irrigation; however, the decision is upon the
leading ministries84.
PDoE has its role to cooperate and provide information to the
company but PDoE does not have rights to monitor the dam
project because it was signed at the national level. Even though
the PDoE has been received additional duties from the MOE
related to hydropower dam, PDoE still face difficulty. For
example, PDoE inKampot province is not sure that they can
perform their task related to hydropower project well or not
because the department does not have enough power to
cooperate and order the company; and human resource is
limited in term of EIA85.
PDoA did not play a key role in Kamchay hydropower dam. In
general, the role of PDoA is to cooperate with the company
such as joining the meeting. Sometimes, PDoA also provides
some ideas concerning compensation resolution86.
Source: Field survey (a)(b)(c), 2013
Villages/Communities
So far only people directly affected from the construction of LS2 dam are seen to be active in
advocating with the government and the company over the compensating and resettlement.
The advocacy is led by the leaders of the existing water management communities in their
respective villages. It is noticed that the movement of the people is not the same, because of
different reason. Srekor village is seen to be the most active in advocating, on one hand,
because their village will be flooded if the dam is constructed, on the other hand, allegedly
because they are on side of the opposition party (commune chief from Sam Rainsy Party).
Pluk village seem does not have strong advocacy activities as the village locate downstream
and few families at the construction site already accept compensation in money.
Those advocating communities are seen to use NGOs and media as the way to bring about
their concern and complaint to the public. According to one of the community leader from
Kbal Romeas, the people are helpless with the existing government administrative structure
to solve their problems; only NGOs and media can bring their concern and complain to public
and international communities87.
82
Meeting with provincial departments in Stung Treng and Kampot provinces
Ibid
84 Meeting with Kampot PDOWRAM, February 15, 2013, Kampot province
85 Ibid
86 Discussion and consultation with PDoA on Feb 15, 2013
87
Personal communication with Keo Mit, Leader of Water Management Community in KbalRomeas village,
Sesan district, Stung Treng, December 28, 2012
83
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4.6. Civil Society on Hydropower
Certain organizations are playing intermediary and representative role for the local
people/affected people on hydropower development in Cambodia, especially in the case of
the Lower Sesan 2 hydropower dam. These main organizations include NGO Forum on
Cambodia, CEPA, 3S River Protection Network (3SPN) and a group of NGOs network
called River Coalition of Cambodia (RCC).
4.6.1. Role of NGOs on Hydropower Development
The NGOs have the role to ensure that the dam’s negative impacts especially on local
community are minimized to an acceptable. In addition, these NGOs also work to build
capacity, to provide knowledge and support the local people/effected people and bring
people’s concerns over hydropower development to involved stakeholders. However, there
are different perceptions of NGOs’ role in relation to hydropower development, for example,
in the case of the Lower Sesan 2 dam. The certain interviewed representatives NGO in
Cambodia mentioned that they are working as a bride connecting involved stakeholders
(academic, government, private, and local people) to discuss proper solutions. This
institution is not to oppose the government’s development, but to ensure accountability,
transparency and sustainable development. Moreover, NGOs are expecting a proper space
for local people to speak out their complaints/concerns related to hydropower development;
to work and to solve problems with the government, representatives of civil societies,
academic and private sectors88. Some NGOs revealed that the organization does not oppose
any government’s development intervention, but is advocating and working on the impacts
caused by hydropower development through workshop and exchange visit to existing dams
in neighbour countries including Thailand and Lao PDR.
The status of those NGOs is to obey all existing policy, regulation and law in Cambodia.
They are working to protect the right of the people under those development activities,
whether the resettlement and compensation is right following Cambodia’s existing law and
regulations. Moreover, CEPA also watches how environment is treated by the government
under such development project as hydropower development89. According to website of 3S
Rivers Protection Network based, this organization’s role is to empower villager
representatives to solve issues related to hydropower and to take a part of decision-making
process for future development activities in the region90. Regarding to supporting the local
people’s concern over hydropower development, on February 14, 2013, villagers from Stung
Treng and Ratanakiri provinces were backed to bring the petition to involved institutions
including the National Assembly of Cambodia and Chinese Embassy due to the villagers are
still not clear about the compensation91. Representative of NGOs argued that they had
received little or no information from the government at the national level and the public
consultation from the involved stakeholders was limited (Field survey(c), 2013).
Based on field observation and consultation with all key stakeholders, the contradicting views
or misunderstanding between NGOs and the government over their status toward dam
development in Cambodia is a cause of cooperation failure of the two sides. NGOs
representatives wish to see a good cooperation with the government, while government
officials do not seem to show good cooperate with them; even though in practice certain
government officials at provincial level cooperate with those NGOs, sometime, the request
and demand from those NGOs are not transferred to and get the support from the decision
makers at higher level. Another seemingly issues is that those government officials at
88
Interviewed with representatives of NGO Forum on Cambodia on March 16, 2013
Interviewed with representatives of CEPA on March 19, 2013
90 3S Rivers Protection Network, http://www.3spn.org/about-us/background/, (accessed on 26 Oct 2013)
91
The Cambodia Daily Newspaper, http://www.cambodiadaily.com/archive/petition-submitted-to-stop-work-onsesan-2-dam-10531/, (accessed on 27 Oct 2013).
89
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provincial level do not want issues claimed or requested by civil societies to appear or be
known by their bosses to avoid the chance of being blamed. Therefore, NGOs always seek
other ways to bring affected people’s voices to public such as through media, their network
members or by organizing demonstration and come to national level institutions or the
National Assembly in Phnom Penh to seek support92. During key informant interview, certain
NGOs’ representatives raised the government still have a view that they are working to
support the opposition political parties93 and certain government officials do not well
appreciate the ideas raised by those NGOs by saying that those NGOs always speak without
basis, they speak on a word of mouth basis or without any concrete evidence94. As explained
by the interviewed NGOs’ representatives, this issue appears due to the lack of
understanding of the role of civil society among the government officials. NGOs claim that
they always raise the truth which is always echoed by opposition political parties to attack the
government, which make the government unhappy with that95.
Despite this constrain and contradicting ideas, certain government officials are allowed to
participate with the activities of those NGOs; however, they are blocked by their bosses
whenever the issue is sensitive. Sometime, even though they can join the events prepared
by the civil societies, the assigned government officials are not allowed to speak whatever
they wish to without prior informing by their bosses96. Certain NGOs also acknowledge that
NGOs sometime go too fast or far beyond what exist in Cambodia’s current context when
some of them are influenced by outsiders (donors or funders). Certain NGOs just say “No To
Dam”. This results in a situation of “one size fit all” in which international standard or
impractical condition is applied by those who even do not well understand its full meaning. As
a result, those NGOs cannot fruitfully comment or contribute to particular issues of
hydropower in Cambodia context and their position is not stable in keeping good
collaboration with the government97. It a fail if any NGOs are not invited by the government to
join the discussion on issues relevant to their work field.
92
Personal communication with representative of NGO in Stung Treng on 13 January 2013
Personal communication with representatives of NGO Forum on 05 March 2013
94 Interviewed with the official from Stung Treng provincial hall in May 2013
95 Personal communication with representatives of NGO Forum on 05 March 2013
96
Ibid
97 Interviewed with representative of NGO on 19 March 2013
93
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Figure 5: Analysis on Gaps Concerning Cooperation between Government and NGOs

- Positive focuses more than negative
Strength of
- Lack of information dissemination mechanism
Strength of civil
Provincial
to local level due to limited resource
societies
Department
- Do not trust NGOs, and not include them in
(Government)
the mechanism
- Stereotype of opposing ideas from NGOs - National interest- People oriented
- Limited role/power of local authorities oriented
- Issue-based
- Longer-term
- Shorter-term
development
plan/strategy
G a p
- Policy oriented
- Good at
plan/strategy
awareness
- Power to influence
raising/capacity
- Negative focuses more than positive
building/Livelihood - Receive little information from the government
decision-making
process
- No legitimate
at national level
power
Legitimate
- NGOs work too independent sometimes
power/authority
- Stereotype of limited government system
- Too ambitious goal

Source: Field survey (a), 2013
4.6.2. Influence of Civil Societies on Hydropower Development
So far, some changes of the government agencies have been found related to hydropower
development. Some government agencies have considered civil society’s recommendations
even though the government itself does not say that they accept those recommendations.
For instance, the Prime Minister of Cambodia used to support the request raised by CSOs to
the government of Lao PDR to delay the construction of Xayabori dam and wait for more
thorough study to minimize its negative impacts. Moreover, it was also observed by NGOs
that after their strong advocating on dam, local authorities visit the villages where the
affected areas more often98. In the case of Lower Sesan 2 dam, local villagers are allowed to
select new locations by themselves, which is a key success for local people because they do
not just accept decision making from the government but they are able to make decision by
themselves, and this move was also applauded by NGOs99. Moreover, the compensation
policy was found to be changed from the original one which was proposed by EVN.
Representatives of the CSOs and communities believe that this change was a result of their
long advocacy in the dam (Field survey(c), 2013). More importantly, without a concrete
resolution, the affected people have been trying to voice their demands in public with support
from stakeholders such as CSOs, and, during at that time, there have been some changes in
political support in the Commune/Sangkat Council Election (the details of the change refers
to the case study of the Lower Sesan 2 hydropower project).
Certain community-based civil society organizations expressed about the limitation
involvement in decision-making process with the government agencies. Certain officials from
Stung Treng Provincial Departments were reached, but not other upper levels. It is a difficult
situation for the local NGOs to influence the decision-making of the government or provincial
institution because not ever issue is transferred to the upper level100.
4.7. Resettlement Policies Change
98
Personal communication with representatives of NGO Forum on 05 March 2013
Personal communication with representative of My Village Organization in Stung Treng on 13 January 2013
100 Information from field survey in Stung Treng province from 12-15 January 2013
99
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Cambodia still does not have exact policy in relation with hydropower development project.
However, the Cambodia’s Constitution, Land Law of 2001 and Expropriation Law of 2010 are
the main related regulations used in hydropower issues. Article 5 of the Land Law states that
land ownership is protected and no one can be deprived of their ownership; however, this
law allows the government to expropriate properties for public interest (RGC, 2001).
Furthermore, in 2010, Cambodia adopted an Expropriation Law, which widened the path for
the RGC to legally expropriate public and private property for projects that serve the national
and public interest (RGC, 2010). However, the Expropriation Law was also equipped with
tools to keep people from being harmed by establishing processes and mechanisms for
expropriation implementation. The Article 22 states that the expropriated properties will be
compensated at market price when expropriation is declared. The price will be determined by
an independent committee, which will be selected by the Expropriation Committee. The
committee is composed of the representatives from the MEF and concerned ministries or
institutions from the relevant provinces (RGC, 2010). Articles 19 and 34 of the Law, however,
state that the government can still expropriate property even if there are unresolved disputes;
however, property owners can continue to challenge the expropriation, or the compensation
they received in the courts (RGC, 2010).
Accordingly, Cambodia has limited experience with large dams and resettlement because
there have never been resettlement caused by the large hydropower dam in Cambodia. The
compensation policy for the affected people had been implemented based on each case of
hydropower project. For instance, the Kamchay dam required no resettlement, but some
compensation was given to households for building transmission lines on their land, and for
affected fruit trees and agricultural land. The compensation procedure was based on
agreeable negotiation between affected villagers and the dam builder and was facilitated by
the local authorities. Conversely, the Lower Sesan 2 dam which is under the construction
preparation stage and is located on the Sesan River in Stung Treng province is expected to
require the resettlement of several hundred households, and to compensate them for the
losses of ecosystem and other natural and social resources. To address these issues,
compensation and resettlement policies have been established and applied (the Law on
Cambodian Government Guarantee of Payments to Hydro Power Lower Sesan 2 Co., Ltd
was approved by the National Assembly of Cambodia) through public consultations with
several communities, provincial departments and the MIME (Field survey(a), 2013). The
compensation for the affected people is claimed to be based on a Sub-decree on Social
Land Concessions (RGC, 2003).
In Cambodia, compensation and resettlement mechanism for both existing and on-going
dams was divided into two levels including national levels and provincial levels. At national
level, the IRC is established and consists of involved institutions including the MEF; the
MIME, the dam developer and Provincial Hall. MEF is a chairman in the committee. At
provincial level, Provincial Governor is the chairman. Under the resettlement committee,
certain technical teams are established consisting of involved provincial departments.
However, lacking of financial support, equipment and human resources to implement
mechanism at the provincial level were found in the case of the Lower Sesan 2 dam (Field
survey(a)(c), 2013).
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Chapter 5: Case Studies
5.1. The Lower Sesan 2 Hydropower Project
LS2 dam is the main target area for this study, which is planned to be constructed in 2014
and it will be the largest dam ever built in Cambodia. The dam is located on Mekong River
Basin where there exists 3 Rivers: Sesan, Srepok and Sekong. 3 villages in the upstream (in
the planned reservoir), and 2 villages in downstream of the dam were selected.
Figure 6: Map of Lower Sesan 2 Hydropower Dam in Stung Treng Province
The Lower Sesan
2 Hydropower dam
Source: Mark; 2012; http://www.rfa.org
5.1.1. Background
LS2 hydropower dam which is expected to build on the Sesan River in 2014 is about 25 km
from upstream from Stung Treng town and 1.5 km downstream of the confluence of the
Sesan and Srepok rivers. This dam could produce electricity about 400 MW within total
project estimated cost USD 781 million (RGC, 2013). The dam will be operated for 40 years
before being transferred to the government plus 5 years of construction.
This dam project is aimed at meeting the need of the energy demand which jumps far
beyond the supply capability, while in 2010 Cambodia imported about 42% of the electricity
energy from the neighboring countries such as Viet Nam, Thailand and Lao PDR (Victor,
2011), and in parallel with the country’s electricity development goal to achieve an annual
Page-47-
increase in generating capacity of 20% to stabilize the electricity sector in Cambodia 101. The
LS2 dam development is ongoing. Obviously, in November 2012, the RGC granted the
permission to the Hydro Power Lower Sesan 2 Co., Ltd, a joint venture which 90% of the
stock is shared by local business Royal Group, to implement the project. Eventually, in
February 2013, the National Assembly of Cambodia has approved the Law on Cambodian
Government Guarantee of Payments to Hydro Power Lower Sesan 2 Co., Ltd which includes
the compensation policy on environmental, economic and social impacts caused by the dam
construction. According the latest update by the Law on Cambodian Government Guarantee
of Payments to Hydro Power Lower Sesan 2 Co., Ltd, LS2 dam project would provide a lot of
benefits for Cambodia stated as below:
Table 11: The Promised Benefits from Lower Sesan 2 Hydropower Dam
- The dam will be the Cambodia’s highest generation capacity of electricity to
ensure dependency and security energy;
- The project would contribute to the reduction of dependency on high cost
imported diesel and obtain fixed price electricity for long-term to promote
country’s economy development and international’s competition;
- The project will provide thousand jobs for local people and increase incomes for
community indirectly to reduce poverty;
- Cambodia would receive additional new technology for Cambodian employees;
- Dam would create beautiful eco-tourist site which could attract tourists due to
green natural view surrounding the planned dam when all infrastructures would
be constructed;
- The affected villagers would obtain proper and new houses with adequate
infrastructures and modern irrigations;
- The investment company would provide 500,000 USD per year (USD 20 million
in total) for EDC to train and develop Cambodian human resources; and
- The government of Cambodia expected to earn USD 29.5 million in revenue tax
per year once the dam starts to generate power.
Source: RGC, 2013
5.1.2. Predicted Impacts of LS2 Dam
Hydropower electricity development, in particularly the LS2 dam, is the subject of
controversial debate in Mekong countries, due to trans-boundary issues, ecological changes
and the environmental and social impacts. The negative social and environmental issues
have been critically addressed among concerned local and international non-governmental
organizations, political parties and CSOs. The LS2 dam‘s reservoir will reach 75 metres
above sea level, flood 335 square kilometres and displace 797 families in three communes
(RGC, 2013). The dam also affects dozens of villages upstream and downstream along the
Sesan, Sreypok and Sekong rivers (KCC, 2009).
There are ecological concerns about the loss of existing habitats for wildlife species in the
Lumphat Wildlife Sanctuary and Virachey National Park. Moreover, fish biodiversity will
significantly decrease, when migratory fish from the Mekong River are no long able to reach
their sanctuary in the protected areas (Biard, 2009). According to the interview,
representatives of NGOs mentioned that there will be fish loos which are the people’s daily
diet will be lost102. The dam will block 9.3% of the Mekong River Basin’s fisheries and 6-8%
of the Mekong River Basin’s sediment, and cause significant hydrological changes to the
Tonle Sap Lake103. However, the government claims that the impact on fisheries, for
101
Interviewed with representative officer of MIME on 23 August 2013
Interviewed with representative of NGOs on 19 March 2013
103
Presentation by Ame Trandem on China's Overseas Dam-Building in the Mekong River Basin during Regional
Public Forum: Mekong and 3S Hydropower Dams on 3-4 June 2013’, Phnom Penh, Cambodia
102
Page-48-
example, is not big; Cambodia still has many other rivers to give such resources and fish can
be raised in the dam reservoir; Cambodia still has many other rivers which could supply fish,
and the government could encourage an aquatic culture programme for fish protein intake
(EVN, 2011). According to a field survey the implementation of resettlement policy of the LS2
dam has been ongoing, but process is slow (Field survey(c), 2013). The downstream
community of the LS2 dam will not be provided with compensation; only a few families
adjacent to the dam site will be compensated. Some worries have been raised by local
villagers regarding to the low water level of the Sesan River resulting from the construction of
dams in Viet Nam’s territory. Therefore, the LS2 dam will create limited water flow after the
completion of its construction (NGO Forum, 2009).
5.1.3. Lower Sesan 2 Dam Decision-Making Process
LS2 hydropower project are seen in the long-term hydropower development plan developed
by MIME in its national sector review for hydropower in 2003. During that time, the installed
capacity of the dam is only 207 MW (MIME, 2003). A year later, after the completion of the
study of hydropower development Master Plan in 3S River Region, LS2 was once again
identified by the government as the first priority with high economic efficiency among the 5
hydropower projects studied in the area (RGC, 2013).
With the proposed project in hand, the government started to discuss with Vietnamese
counterpart in 2006 to seek the possibility to construct LS2 dam (BankTrack, 2011) and in
2007, RGC agreed in principle to allow EVN International Joint Stock Company to work on
the project’s feasibility and to identify any possibility for co-investment by the 2 countries.
During that year, a MoU between MIME and EVN was signed to kick off the environmental
impact assessment and the feasibility study for the project which were set to begin in 2008
(KCC, 2009). The feasibility study was conducted by Power Engineering Consulting Joint
Stock Company 1 (PECC1) under the cooperation with relevant technical ministries of the
Kingdom of Cambodia, and EIA study was conducted by Key Consultant Cambodia (KCC)
under the contract with PECC-1(KCC, 2009). In MOE, ENV is required to study 2 projects,
Lower Sesan 2 Hydropower in Stung Treng and Lower Sesan 1 Hydropower locate near
Cambodia-Viet Nam border in Ratanakiri province (TVK, 2011) PECC1 was also known to be
responsible for developing the resettlement and compensation policy (BankTrack, 2011).
During that time, the project was claimed to be built for 5 years from early 2012 to 2017
under BOT basis of only 30 year of operation, and 100% of the generated electricity will be
used in Cambodia including the current 2MW demand in Stung Treng province which is
different from previous intention that 50% of the electricity will be sold to Viet Nam (TVK,
2011).
Page-49-
Figure 7: Process of LS2 Hydropower Decision Making
Source: Author
The studied of EIA started in late March 28, 2008 including 2 main consultations; the first
consultation was conducted in February, 2008 with villages in Stung Treng and Ratankiri
provines where hundreds of people are invited to participate. The second public consultation
was done in May 2008 in Sesan district, where only government relevant local officials
including village chief were allowed to participate (KCC, 2009). The several reviews104 of
draft EIA report started from early 2009 and finalized by the inter-ministerial meeting in July
2, 2009 with relevant ministries and chaired by Minister of Environment. The final comment
from MOE to the draft EIA report was seen on the last later from MOE dated February 9,
2010.
In 2011, Cambodia-Viet Nam Hydropower Company which was a joined venture between
EVNI and Cambodian conglomerate Royal Group was known publically (Mark, 2012) and
until April 2012, the joint venture was officially announced and LS2 hydropower was then set
to operate in 2017. However, by in November, 2012, EVN was no longer the main
shareholder of the project when Royal Group signed an agreement to build LS2 hydropower
dam with Hydrolancang International Energy Co. Ltd105. The Implementation Agreement (IA)
was signed between MIME, MEF and Hydro Power Lower Sesan 2 Co., Ltd. on November
26, 2012 (RGC, 2013) after the project was approved by the RGC during the plenary session
of the Council of Ministers on November 02, 2012 (RGC, 2013). The IA set clauses saying
that the RGC needs to guarantee the business of the project investor from defined risks and
need National Assembly to ratify this. Therefore, on February 15, 2013, the National
Assembly voted to ratified the Law on Financial Payment Guarantee by the Government of
Cambodia to Hydro Power Lower Sesan 2 Co. Ltd. to cover 2 conditions: 1. the government
guarantee to pay for fee of power purchase in the event of non-payment by EDC; 2. the
government will buy the project means in case that the company cannot perform because of
political force majeure event.
Be noted that presently, Hydro Power Lower Sesan 2 Co. Ltd is made of Local conglomerate
Royal Group own 90% of the share in partnership with China’s Hydrolancang International
Energy Co. Ltd as additional partner and EVN owns only 10% (RGC, 2013).
104
The review of LS2 draft EIA study includes: inter-department review, the review by management team chaired
by Secretary of State during January, 2009.
105 Cambodia Daily Newspaper, Agreement Signed for Construction of Lower Sesan 2 Dam,
http://www.cambodiadaily.com/news/agreement-signed-for-construction-of-lower-sesan-2-dam-6335/, (accessed
08 January 2013)
Page-50-
5.1.4. Stakeholder’s Participations
Based on EIA report was conducted by KCC in March 2008, consultations were conducted
two times. The first consultation was conducted in February 2008 in villages in Stung Treng
and Ratanakiri provinces where hundreds of people are invited to participate (KCC, 2009). At
the end of meeting 85% of participants present said that they disagreed with the proposal
(Mark, 2012). The second public consultation was done in April 2008. The result was
different from the first consultation because it was claimed that about 94% of participants
were in agreement with the project (Mark, 2012). Based on field survey, the reason that
some people cannot express their opinion is because they cannot speak Khmer language
(Field survey(c), 2013). According Representative Manager Office for the Electricity of Viet
Nam Company (EVN), the company also invited people’s representatives and local
authorities to visit dams in Viet Nam and see the compensation and resettlement policy
(TVK, 2011).
Later, a third meeting was held in Stung Treng town where only the affected communities,
provincial departments, representatives of NGOs, holders of affected economic land
concessions, the officials from the MOE and MIME. During the meeting representatives of
KCC and PECC1 delivered PowerPoint presentation and only a few participants were
recorded to have asked questions. The majority of affected people located upstream and
downstream of the dam site were not consulted during the EIA process and people who will
indirectly affect by LS2 dam were not consulted (KCC, 2009; Mark, 2012). There were limited
affected people were consulted in EIA report due to about 30,000 people living upstream will
be negatively affected by the Lower Sesan 2 dam and ten thousands of people living
downstream (NGO Forum on Cambodia, 2009).
Based on field survey, the Stung Treng Provincial Department of Industry, Mines and Energy
(PDOIME) and the Stung Treng Provincial Hall are the key institutions that mostly joint and
discussed hydropower development issues with the company. Lacking of participation
mechanism among the government agencies and the company while there are only few
representatives of provincial departments could join and know about the EIA process (Field
survey(a), 2013). For instance, even though MOWRAM is a main institution dealing with
water development issues, in practice, Stung Treng Provincial Department of Water
Resources and Meteorology (PDOWRAM) was found to play less important role and does
not has much influences on any decision making regarding the LS2 dam. PDOWRAM was
rarely invited to join meeting with PDOIME and the company representative. Therefore, only
less information is aware concerning the hydropower development106.
The first draft of EIA report was reviewed by inter-department and management team chaired
by Secretary of State in January 2009 and finalized by the inter-ministerial meeting in July
2009. The updated EIA report was then submitted to the MOE, and finally approved in June
2010107. On November 02, 2012, government indicated that the company who are
responsible for constructing the LS2 dam to build houses for thousands of affected people
that they are going to resettle in new locations108. As a result, November 23, 2013, concrete
house with eight members living, 5 ha of agricultural land and 5,000 m2 (50m x 100m) of
village land will be offered to affected villagers (Field survey, (a) (c), 2013).
106
Consultation and discussion with Stung Treng PDOWRAM
Letter from Prime Minister Samdech Hun Sen, Letter No31: Clarification to the request by HE Son Chhay,
Phnom Penh Parliamentarian, for delay in the implementation of the Hydropower Project of Lower Sesan 2 of the
Vietnamese Company EVN in joint venture with the Royal Group Company, 28 July 2011.
108 Cambodia Daily Newspaper, Dam Approval Angers Villagers, Rights Groups,
http://www.cambodiadaily.com/archive/sesan-dam-approval-angers-villagers-rights-groups-5231/, (accessed 05
November 2013)
107
Page-51-
5.1.5. Compensation and Resettlement Mechanism and Policy
Cambodia has limited experience with large dams and resettlement. For instance, the
Kamchay dam required no resettlement, but some compensation was given to households
for building transmission lines on their land, and for affected fruit trees and agricultural land.
The compensation procedure was based on agreeable negotiation between affected villagers
and the dam builder and was facilitated by the local authorities. For instance, for an uprooted
durian fruit tree, a variety of compensation up to USD 500 was paid per tree and for
agricultural land, USD 3 was paid per square metre (Field survey(b), 2013).
Conversely, the LS2 is expected to require the resettlement of several hundred households,
and to compensate them for the loss of ecology and environment. To address these issues,
compensation and resettlement policies have been established and applied (the law on
guarantee payments mentioned above) through public consultations with several
communities, provincial departments and the MIME (Field survey(a), 2013). To build the LS2
dam 797 families are expected to be resettled (RGC, 2013). The compensation package
includes new concrete houses, residential and agricultural lands, livelihood restoration
programs, and infrastructure development at the new location (RGC, 2013) In fact, the LS2
dam’s resettlement and compensation policy was originally proposed by EVN, and classified
the type of replacement houses according to the number of family members (for example,
house for 1-2 members, 3-4 members, 5-7 members and more than 8 family members)
(EVN, 2011). In that former compensation package, each affected family would receive 1.5
ha of agricultural land (EVN, 2011).
The affected people were dissatisfied with this compensation because of low quality of the
proposed houses (Biard, 2009). However, in what seen as a better solution, the new
compensation and resettlement policy was announced by the RGC again in November 2012
that every affected household in the dam’s reservoir will be compensated with an eightmember-size concrete house, 5,000 m2 of residential land, and an additional 5 ha of
agricultural land (RGC, 2013). In addition, people will be allowed to select the new location
by themselves. However, while this decision might make certain affected people happier,
until May 2013, the new place for relocation is unclear because, as reported by local
authorities and the people, the assigned working group is still seeking for acceptable good
location for resident and agriculture. Government officials are optimistic about this move by
saying that the new package arrangement is the government’s effort to make the LS2’s
compensation and resettlement a good model for other dam in Cambodia109. In addition to
that, the CSOs and communities believe that this change was a result of their long advocacy
in the dam110.
It seems that there is no clear standard for compensation and resettlement in Cambodia, but
a case-by-case basis is used. As such, the impact and mitigation measures for the LS2 dam
is stated in a discrete law, the Law on Cambodian Government Guarantee of Payments to
Hydro Power Lower Sesan 2 Co., Ltd, with a total budget of USD 41.94 million(RGC(b),
2013). The compensation is claimed by certain interview provincial officials to base on a Subdecree on Social Land Concessions (RGC, 2003); however, the latest proposed condition of
the compensation and resettlement for the LS2 dam declared by the government, for
example the type of house, was understood to be improved as much as possible in favor of
the affected people.
The study by Ian G. Baird shows that the LS2 project failed to meet even the minimum
standards for public participation because not every affected upstream and downstream
village was included in the study (Biard, 2009). Public consultations were organized in the
109
110
Interviewed with the official of Stung Treng provincial hall in May 2013
Interviewed with the representative of NGOs on 16 March 2013
Page-52-
villages and government officials informed villagers of the dam development and its
compensation and resettlement. However, interviewed villagers stated that most villagers
were worried about their concerns and demands. Moreover, the information was not
effectively disseminated to the affected people due to the language barrier when most of the
affected people communicate in Lao (Field survey(c), 2013). Upstream villagers stated that
they did not want to have concrete houses because the new houses would be of low quality
compared to the good quality wooden houses they used to have. Downstream villagers
complained that the dam would cause a loss of biodiversity resources, poor water quality and
flooding (Field survey(c), 2013). Regarding the alleged limited scope of EIA study, the
interviewed government stated that the downstream villages would only suffer minor affect
and should not be eligible for compensation at all and that’s why they were not included in
the study111.
Most affected people in upstream and downstream villages are not well aware of any details
of the latest compensation policy made by the government (Field survey(c), 2013). For
example, most of the affected people do not know about the house and residential land
compensation. The affected villagers are not satisfied with the way the information is shared
because the information is unclear and is not fully disclosed. The unclear information about
the compensation and resettlement policies, and the relocation date, has made the affected
people unhappy and curious. At the current location, the villagers do not dare to grow their
crops and make any income as they are not sure the concrete move of the construction as
well as the resentment and compensation. Regarding this relocation, the Prime Minister of
Cambodia has stated that clearly that the affected people will be moved to a new location
only when the needed physical infrastructures, and even certain fruit tree, are installed and
the village is ready for living. Therefore, at the moment, the priority is to make sure that
promised conditions are effectively delivered to the affected people112.
5.1.6. Compensation and Resettlement Mechanism
The compensation and resettlement mechanism for the LS2 dam appears to be clear and
well-prepared. The mechanism has been officially established at both national and provincial
levels (See Figure below). At national level, the IRC consists of four key institutions: the MEF
as chair, MIME, Hydro Power Lower Sesan 2 Co. Ltd and the Stung Treng Provincial
Governor as members. This national committee works to approve resettlement action plans
and compensation rates for any project requiring resettlement (Biard, 2009). At the provincial
level, the committee is chaired by Stung Treng Provincial’s Governor and supported by two
Technical Teams led by relevant Provincial Departments. The provincial committee plays a
significant role to enforce the resettlement and compensation plans. It communicates with
the two technical teams, which are effective in the operation of the committee, engaging with
affected communities, mapping out potential resettlement sites, serving as liaison with other
stakeholders, and receiving complaints (Field survey(a), 2013).
The establishment and implementation of the compensation and resettlement mechanism
was assigned directly to the provincial level by the Office of the Council of Ministers;
however, the initial implementation became a challenge because the necessary resources
were the responsibility of each of the lower implementing institutions. Even through the
mechanism is in place, the enforcement is still limited. The two Technical Teams have yet to
produce any significant results because of the uncertainty in budget sources and the lack of
necessary equipment for field work which is claimed to be difficult and complicated,
especially for the case of Srekor commune (Field survey (a), 2013). The established
mechanism does not have any space to handle complaints or communicate information with
the affected people. The provincial authorities acknowledge issues, but said that it is
111
112
Interviewed with the official of Stung Treng provincial hall in May 2013
Ibid
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because the construction has not yet fully started113. However, the affected people, the
CSOs in particular, feel that could share news to meet their demands.
Figure 8: Structure of LS2 Dam’s Compensation/Resettlement Committee
Source: Field survey, 2013
5.1.7. Cultural and Spiritual Impacts
Cultural and spiritual impacts of the LS2 dam have been reported but they have not been
included in the latest compensation policy. As reported, the cultural and spiritual impacts are
intangible and could not be recorded in economic value (Field survey(c), 2013). In
Cambodia, the indigenous people live mainly in provinces in the northern part of the country,
including Stung Treng province where LS2 dam is located. The indigenous people have been
described as the “most ancient inhabitants of the land with strong cultural and economic ties
to their environment” (Palmieri, 2010). In generation, culture plays a significant role as an
arbitrator in the informal resolution of internal conflicts in communities, and is strongly
believed to aid health-care prevention, provide lucks and high yield of agricultural production,
improve livelihood and sustain the economy. The livelihoods of the indigenous are based on
animal husbandry, shifting cultivation, and the collection of non-timber forest products from
113
Interviewed with the official of Stung Treng provincial hall in May 2013
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the natural forest. They are strongly united, and have deep respect for customary law,
practices and religion (Moul & Seng, 2012). Culture is known to be a key component of being
human. It has been found that culture not only provides benefits for the living conditions of
people but also allows people to generate more income, and increases happiness, good
health and high-yielding crops when it is preserved (Matthews, 2012; Moul Phath and Seng
Sovathana, 2012). Both the upstream and downstream villages of the Lower LS2 dam are
populated by indigenous people including the Khmer Laotians, Phnong, and Kroeng
minorities.
Most of these people profess a belief in Buddhism; however, the cultural and spiritual
impacts of the LS2 dam do not seem to be included in the compensation policy. 88% of the
upstream villagers (out of 106 respondents) mentioned that their religion and tradition would
be affected if they were relocated because their Buddhist’s temples, the guardian spirit of
their village (‘neakta’), the guardian spirit of the forest (‘areak’), and their ancestors’
graveyards would be flooded. In addition, the guardian spirit of the rivers (‘neakta krahom
kor’) would be affected (Field work(c), 2013). All of these spirits are celebrated from
generation to generation, and are believed to protect villagers from illness, bring them
happiness and harmony, provide them with good businesses and agricultural activities, and
protect them when they travel on the river.
An official from the Stung Treng Provincial Hall claimed that cultural losses had already been
integrated into the compensation and resettlement plan. However, they are not mentioned in
the EMP of PECC1’s EIA report or in the Law on the Cambodian Government’s Guarantee of
Payments to Hydro Power Lower Sesan 2 Co., Ltd. adopted by the National Assembly in
February 2013. The stakeholders involved might not consider the loss of cultural and spiritual
beliefs as important as the loss of economic benefits. In any case, the local people argued
that the loss of their spirituality cannot be compensated – if their villages are flooded; they
are gone, except for the Buddhist temples which are seen to be easier to compensate
because these could be built in the new location. Elders interviewed in the Srekor villages
mentioned that these issues will have to be resolved traditionally if people are to feel more
satisfied about the compensation package.
Traditionally, the people in the areas surrounding the LS2 dam site either bury or cremate
their dead. Cremation occurs at the local temple, while burials are performed at communal
graveyards close to the villages. These graveyards are extremely important spiritual sites.
The families of the dead frequently pay their respects to the dead in order to attract good
luck, and make offerings of food, and burn incense for them. They may invite Buddhist
monks to perform ceremonies in the graveyards, especially on Phchum Ben Day (the day of
the ancestors, an extremely important religious holiday in Cambodia) and Khmer New Year’s
Day. It is believed that the ancestors will be angry and curse them with sickness or other
problems if they fail to conduct these rituals. The elders stated that if the area is flooded,
there are two ways of dealing with the ancestors’ graveyard: giving up or moving them to the
new location. In any of the two ways, spiritual and traditional rituals will have to be
performed, and so do the moves of other spirits (NhoiySro, Elder in Kbal Romeas village,
2013). Moreover, in seeking out a new place to live, local people must first ask the spirit of
the land guardian (neakta) for permission by praying and through rituals.
Such respect and ceremony is considered vital to the villagers’ lives and their harmony. For
the people, any development or activity that displeases the spirits will harm all of them. Even
though cultural and spiritual loss is very important to the local people, support for this issue
seems to be unclear and has received less attention from the project developer and the
RGC. Without a concrete resolution, people’s concerns rise up and they seek an alternative
solution from outsiders including political parties who might help to reduce their worries.
Meanwhile, the affected people have been trying to voice their demands in public with
support from stakeholders such as CSOs, and, during at that time, there have been some
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changes in political support in the Commune/Sangkat Council Election. This change in
support is explained in the next section that critically analyses how the local villagers have
started to use their voice and rights to generalize and mobilize a shift in political support.
5.1.8. Shift in Political Support
Cambodia had passed some certain eras. In the post-colonial era, the Cambodian state
pursued a socialist development strategy. In recent decades, Cambodia has adopted a new
development strategy premised on a greater role for democratic society and opening private
investments as part of economic growth in the context of utilizing natural resources including
forest and water resources for political power and state economic intervention (Field
survey(c), 2013). The democracy process in Cambodia flourished in Cambodia after the
Paris Peace Accord signed by Cambodia’s disputing parties in 1991. The first National
Assembly Election was managed by the United Nations Transitional Authority in Cambodia
(UNTAC) in 1993. This was the first time ever that Cambodian people were given rights to
select their political parties through a democratic process. In the election system of
Cambodia, there are two important elections: the National Assembly Election and the
Commune/Sangkat Council Election. Since the first National Assembly Election, the
presence of political parties and seats in the national assembly has changed over time. The
first National Assembly election resulted in a government with Co-Prime Ministers, which was
the result of negotiation between the National United Front for an Independent, Neutral,
Peaceful, and Cooperative Cambodia (FUNCINPEC) and the Cambodian’s People Party
(CPP). Since the 1997 armed confrontation between the supporters of CPP and
FUNCINPEC, the CPP has held the majority of seats in the National Assembly and the
number of seats held by FUNCINPEC has continuously decreased. In 1998, the Sam Rainsy
Party (SRP), which split from the FUNCINPEC party, and which was known as the biggest
opposition party in Cambodia, won the seats in the National Assembly. The popularity of the
SRP has been increasing from one mandate to another (see Table below).
Table 12: Timeline of Political Seats in the National Assembly
Seat’s political
party in NA
Year of election
Remarks
CPP
SRP
1st Mandate in 1993
51
- Co-Prime Ministers from CPP and
FUNCINPEC
SRP has not yet formed
2nd Mandate in 1998
64
15
SRP got 15 seats
3rd Mandate in 2003
73
24
SRP got 24 seats
th
4 Mandate in 2008
90
26
SRP got 26 seats
5th Mandate in 2013*
68
55
- Cambodian National Rescue Party (CNRP)
got 55 seats
- CNRP was formed through the merging of
the SRP and Human Rights Party (HRP) in
mid-2012
* Preliminary result by NEC in August 2013
Source: NEC, 2013
The first Commune/Sangkat Council Election was held in February 2002, and aimed at
establishing and promoting democratic development in Cambodia through decentralization
and de-concentration. This election is held every five years to select the Commune/Sangkat
Chiefs and Commune/Sangakat Councils. The ruling CPP currently administers most of the
communes in Cambodia. Stung Treng province has a total of 34 communes. Referring to the
Table 2 below, the result of the 2nd Commune/Sangkat Council Election in 2007 indicated that
the 34 commune chiefs were all occupied by the ruling CPP party while the SRP secured
only three positions as first deputy commune chiefs (NEC, 2007). After the 2012
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Commune/Sangkat Council Election, the SRP won for the first time the position of Commune
Chief in Srekor, which is one of the seven communes of the Sesan district in Stung Treng
province and one of the three to-be-flooded communes of theLS2 dam. With the result of 294
votes for the CPP and 539 votes for the SRP (NEC, 2012), this opposition party was
appointed to administer and govern the two villages as Srekor 1 and Srekor 2 for a five-year
mandate from 2012 to 2016.
Table 13: Commune/Sangkat Council Election Result in LS2 Dam Reservoir
Commune Chief Position
Name of commune
Year of 2007
Year of 2012
Srekor (Upstream)
CPP
SRP
Kbal Romeas (Upstream)
CPP
CPP
Pluk (Downstream)
CPP
CPP
Source: NEC, 2007; NEC, 2012
To hold this position as a commune chief, there are many challenges such as administration,
social security, natural resource management, delivering public services, and political
influencing, which need to be managed and controlled in an effective manner. In this sense,
the current Commune Chief has been dealing with certain issues such as solving overlapping
land issues between community with local land economic concession company, and support
the villager networks to have stronger voices in order to seek more interventions to protect
natural resources including forest, wildlife and fish which will be greatly impacted by the LS2
dam. Local villagers indicated that the shift in political support was because they wanted to
select a new commune chief who was more responsive to issues in the commune, especially
the dam project. But the study shows that several factors led to this political change. The
affected people do not want the dam to be built in their area because their lives rely mainly
on the environmental and natural resources which will be negatively affected (Field
survey(c), 2013). However, because the LS2 dam is the government’s project, it is
impossible to depend on local authorities from ruling party, whom was claimed by the
villagers to be already under the government’s structure (Field survey(c), 2013); therefore, it
is a good for the SRP when they are seen to be actively advocating for the CSOs and when
they win support from the affected people through their promise to respond to the people’s
demands, such as to stop building the LS2 dam, protect the villagers who collect NFTPs and
logs for family purposes but crackdown on illegal logging, and reclaim community land from
the land concession company (Field survey(c), 2013).
Secondly, people were very worried about how the compensation and resettlement would be
implemented. The people are not well informed by the mitigation intervention from the
government and the dam builder. The lacking of information sharing on the compensation
mechanism and the unclear indications on items relating to payment for the villagers’
property losses, has resulted in most of the affected people having less trust and confidence
in the mechanism. Instead, most of the affected people complain that they receive their
information on the LS2 dam’s compensation policy and resettlement actions mainly from
independent media, non- governmental organizations and civil society (Field survey(c),
2013). Thirdly, if the project is built, the affected people want local authorities to make sure
that their livelihoods at the new locations will mean that they are better-off and that they will
get the benefits from the dam and not just be the losers. To achieve this, the people’s
concerns and demands must be carefully considered by the RGC; however, the space for
the people is limited, which causes them to seek better channels to convey information,
concerns and complaints to key players such as government institutions, the national
assembly and the dam company (Field survey(c), 2013).
The loss by the CPP in the Commune/Sangkat Council Election in Srekor commune is a
message to the government regarding the LS2 dam development and the way the mitigation
measures are implemented. A leader of the CPP working team in Srekor commune
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confessed that money cannot buy everything114, meaning that traditional propaganda such
as giving money and gifts probably no longer works, but the development policy should be
considered seriously. During his mandate, the new Srekor Commune Chief from the
opposition party was seen to be very active in the public media, raising concerns over the
issues of the LS2 dam; however, his demands were seen to have changed from stopping the
dam to making sure the affected people were better off after the dam’s construction (Field
survey(a), 2013). However, there is no significant change in the government’s position
towards the LS2 dam project. The change of local administrative body exists only in the
Srekor commune where there are two villages that will be totally flooded even though
changes were noticed in other communes which will be partly flooded by the dam through
the Commune/Sangkat Council Election. This also means that the loss of Srekor commune
alone will not affect the National Assembly Election in 2013 because there is only one
National Assembly seat in Stung Treng province. Based on the results of the National
Assembly Election announced by the NEC on August 12, 2013, the CPP still occupy the
National Assembly seat of the province (NEC, 2013).
5.2. Kamchay Hydropower
The Kamchay dam is a first large scale hydropower project in Cambodia. Even though the
dam is outside Mekong River’s basin, this dam will be a lens to check the under the
hydropower decision making process in Cambodia; moreover, it will be a space where the
study can look into the consequence of the decision making process of the project.
5.2.1. Background of Kamchay Hydropower
Kamchay hydropower dam locates in Teuk Chhu district of Kampot province, South-Western
part of the country, around 15 km upstream north of Kampot town. The hydropower has two
dams—the first one is around 4.5 km from Teuk Chhu tourist site and the second one is 300
m from the site. The first dam height is 153 m, and the second one is 31 m from the bottom of
Kamchay River (SAWAC, 2011).
Figure 9: Location of Kamchay Hydropower
Dam #1
Dam #2
SnamPrampi
Mak Prang
Kampot Province
Source: SAWAC ESIA Report 2011
114
Interviewed with the official of Stung Treng provincial hall in May 2013
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Development attempt of Kamchay has long history; it was initiated since before Khmer
Rouge regime. The interest of developing hydroelectric dam in Kamchay existed during the
1960s, but vanished when civil war broke out (Mark, 2012). In 1995, Hydro Quebec115 from
Canada studied the possibility to build the hydropower project and proposed the installed
capacity of 127MW with the estimated cost of USD 270 million. However, the proposed
project did not seem economically viable; therefore, the project was restudied again by
Tasmanian Hydroelectric Commission Enterprises Corporation (HECEC), a company from
Australia, who proposed smaller installed capacity of only 45MW and the environmental
impact would be minimal (World Bank, 1999).The two feasibility studies failed to
operationalize the hydropower project when CIDA the main financial support, withdrew out
of the project. The factor contributes to CIDA’s withdrawal which is the pressures from local
and international NGOs who claimed that project located within Bokor National Park and
that the project will be a threat on the environment in the area because of the lack of public
consultation (Mark, 2012).
In 2001, MIME went into MOU with Experco116 to conduct another feasibility study again with
financial support from the government of Canada through CIDA (Malmquist & Sigfridsson,
2002). This feasibility proposed the install capacity of 180MW and the RGC categorized it as
one of the four initiatives of hydropower generation and the project was set to commission in
2010 (MIME, 2003). In 2004, an international bidding was organized and participated by
certain bidders form Cambodia, Japan, South Korea, and China and a year later, Sinohydro
Corporation, the Chinese state-owned company, was announced the winner of the
bidding(Mark, 2012). Sinohydro went into a 44 year BOT agreement with the RGC and
started its construction in 2007. According to the ESIA report by SAWAC, the project was
originally the Kamchay was planned to produce 194.1 MW. The construction was completed
and commissioned on December 07, 2011. It was announced the first major hydropower
plant in the country. The Kamchay hydropower dam was financed by the People’s Republic
of China through Sinohydro Corporation with the total project cost of USD 280.54 million.
5.2.2. Project’s Purpose
Prime Minister of the Kingdom of Cambodia on December 07, 2011 at inauguration
ceremony of Kamchay hydropower dam said that Kamchay dam project will produce power
sources which provide great potential for stimulating the economic dynamics and ensuring
growth, sustainability growth and social welfare by increasing the power supply capacity to
serve the need of socio-economic activities. With the maximum potential of 10,000 MW from
hydropower development, the government has intended to utilize this energy to complement
the constantly rising price of oil, gas and coal, and other renewable energy sources such as
biomass energy, solar energy, and small-scale hydropower plan117.
Kamchay hydropower dam will be serving as sources for clean water, irrigation, and
reduction of flood downstream, maintenance of water volume of TekChhu canal, and create
tourist site in the area (SAWAC, 2011). As informed by PoDIME, the electricity generated
115
Hydro-Québec is a government-owned public utility established in 1944 by the Government of Quebec. Based
in Montreal, the company oversees generation, transmission and distribution of electricity for all of Quebec.
116 Experco is a Canadian consulting and engineering company involving in such business as: agriculture,
environment, construction, urban infrastructure, transportation, geomatics, energy, telecommunications and
industry.
117
Address of Samdech Hun Sen, Prime Minister of the Kingdom of Cambodia on December 07, 2011, at
Kamchay Hydropower Electric Dam in Kampot
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from the dam is used to supply in Phnom Penh and in future perspective it will be serving
industry sector in Kampot such as K-Cement Company, tourism sector (restaurants and
hotels) and special economic zone. So far, Kampot residents are not able to utilize electricity
from Kamchay hydropower dam yet; but they are still utilizing electricity grip from Viet
Nam118.
5.2.3. Kamchay Dam Decision Making Process
Looking at the background of Kamchay hydropower project, the hydropower initiative came
from the government of Cambodia to solve the energy issues while technical and financial
support was from international institutions. With several studies by various international
institutions and experiencing through tension deriving from civil society’s pressures, the
government was eventually convinced by the last and additional study conducted in 2001
over the potential of Kamchay hydropower project. Kamchay hydropower, in 2003, was
identified as one of the four initiatives of hydropower generation and the project appeared in
the government’s short and medium term hydropower development plan and was set to
commission in 2010 (MIME, 2003).
MIME held the international competitive BOT bidding for Kamchay hydropower project by
announcing the Invitation to Bid in July 2004 followed by bid opening on January 17, 2005 119.
There were at least 17 companies from Cambodia, Korea, Japan, China, Canada
participating the bids (Carl Middleton and Sam Chanthy, 2008). Sinohydro was known to be
bid winner when officially announced by MIME on April 27, 2005 shortly after the
announcement (Sar.Chhor.Nor) by Council of Minister on April 25, 2005 (SAWAC, 2011). On
July 4, 2005, Sinohydro and MIME signed an agreement to consolidate the contract with the
presiding by Cambodia Prime Minister Hun Sen and China’ Premier Wen Jaibao (Carl
Middleton and Sam Chanthy, 2008) and until February 23, 2006, MIME and MEF singed the
44 year BOT agreement with Shinohydro Kamchay Hydroelectric Co. Ltd. to construct
Kamchay hydropower starting from 2007 to 2011. As part of the business registration,
Sinohydro request for registration with CDC on July 03, 2006 and the registration was
approved on July 31, 2006(SAWAC, 2011).
Figure 10: Kamchay Hydropower Decision Making Process
Source: Authors
Be noted that EIA study was criticized by civil societies and researchers as being too late.
Full EIA study implementation of Kamchay hydropower was approved by MOE on January
28, 2010 and until April 2011 the study was completed (SAWAC, 2011). This means that full
118
Discussion and consultation meeting with PDoIME on Feb 15, 2013
http://www.bajuintl.com/English/Web/PicView.aspx?BMID=1006&SMID=10061&NewsID=1429, (accessed 18
June 2013)
119
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EIA completed too later than the start of hydropower project, but completed on the year of the
construction deadline. Mark (2012) noticed the condition of this lateness as “the rice is
already cooked”, and question about the quality and the implementation of the project’s EMP
(Mark, 2012). It is also unclear how CDC makes decision to approve investment registration
in 2006 when such required document as full EIA is not available. The Cambodia’s National
Assembly, on July 26, 2006, approved financial guarantee to Sinohydro for the project
implementation. Cambodian government shows commitment to compensate the company if
the project faced difficulties or if the project under-performs. As written in a letter to National
Assembly on October 19, 2008 regarding China’s investor of Russey Chrum River, the Prime
Minister stated “In order to make the investor feel at ease, the government need to ratify a
guarantee of payment”120. The government also claim that the guarantee will lead to cheap
electricity that in turn will attract more investor to Cambodia (Carl Middleton and Sam
Chanthy, 2008)
5.2.4. Stakeholder’s Participations
At local level, Kampong Kreng commune chief said that she did not know clearly about EIA
process as she just became this new commune chief. All information might be still kept at
former commune chief. Local people in this commune knew about Kamchay hydropower dam
construction through taking from mouth to mouth and they saw some activities of Chinese
company121. Based on group meeting with local authorities and villagers in Snam Prampi
village of Mak Prang commune, commune chief who was assigned in 2007 claimed the
company might be invited local people to join the meeting in 2006 but it was not widely
conducted because traditionally local people in this commune did not want to join the meeting
because most of them are busy with their business activities, and look after their crops
plantation (Chamkar). Commune chief indicated that there was a meeting and the company
had provided master plan that affects local people, and then commune chief have a role to
prepare report of those affected people to negotiate with the company representatives122.
At the provincial level, the Department of Environment has joined meeting twice with
SAWAC. In EIA process, the PDoE has a role to provide information and cooperate with
study team, SAWAC. By the way, PDoE does not have right to monitor project
implementation because in case of Kamchay hydropower dam is a mega project and it is the
main responsibility of the ministry. In EIA process, there are two core problems – first, the
PDoE does not have enough right to cooperate and order the company as the company
closely work only with Kampot provincial hall and PDoIME; and second, PDoE still does not
have enough knowledge or capacity on EIA issue due to lacking of expert officials on EIA
issue. It is raised that capacity of officials on EIA knowledge should be built by the MOE123.
Representative of PDoA mentioned that his department did not have key role in Kamchay
hydropower dam but he used to join meeting that talk about Kamchay hydropower dam, and
in the occasion he used to provide some ideas related to impacts from the dam124. It is notice
that key respondents from PDoWRAM and PDoT are not able to provide idea about EIA
process and participation in EIA. As EIA process seems to be sensitive in a case of Kamchay
hydropower so key provincial departments such as PDoE and PDoIME seem do not want to
talk about it.
120
Cambodia Daily Newspaper, (accessed 7 November 2008)
Group meeting with local authorities in Kampong Kreng commune on Feb 16, 2013
122 Group meeting with local authorities and villagers in Mak Prang commune on Feb 16, 2013
123
Discussion and consultation with PDoE on Feb 15, 2013
124 Discussion and consultation with PDoA on Feb 15, 2013
121
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The EIA seem does not gain full attention from main provincial department related to
Kamchay dam. For example, PDoIME is unclear about EIA report and up to the date of
interview PDoIME has not received full EIA report yet125.
5.2.5. Impact after Construction of Kamchay Dam
According Kamchay Full EIA report (2011), during the construction period, 1,961.69 ha of
forest area could be affected including 1,545.69 ha of ever green forest and 416 ha of
bamboo forest. This figure also includes the area of Bokor National Park of 2,229.77 ha
(mostly are ever-green forest), and 7.85 ha of agricultural land occupied by the people in the
areas of dam 2 and its reservoir. Fifteen species in dam reservoir and 17 species of fresh
water fish and other 26 fish species living in the lower part of the Kamchay stream where
seas and fresh water mixes would be affected. 7.84 ha of agricultural lands in Dam 2
structure and few other crops in the project areas will be affected. Moreover, the livelihood of
the people depend on NTFP as well as the tourism sector will be irritated because of the
construction structure, activities, waste and the block of water in the Kamchay stream. The
report found that fish catches on the Prek Kamchay and the Stung Keo may drop from
25,433 kg in 2006 to 15,499 kg in 2010. Vendors and business people at the Teuk Chhu
tourist are estimated to loss over ¼ of their income of over USD US2.86 million in 2006.
Income of people will reduced between 50-60% after the project commenced construction. In
dry season during the construction villagers notice downstream poor quality of water quality
as the water became darker in color with bad smell, which is the result of discharge from the
dam construction like cement and other sediment. This water issues could lead to problems
with skin and hair for those who depend on the water. However, no measure or
compensation was made. When the reservoirs are filled with water, 1,788 ha of wildlife
habitats will be affected and the limited flow of water and the block of fish migration will affect
certain endanger fish species.
The positive impact during the construction phase that are generally raised by all stakeholder
involved are the job creation for local people. The construction of Kamchay hydropower dam
also created employment opportunity for local people surrounding the dam. Some of them
can work as workers, translators, and guards. Among two visited communes, Mak Prang
commune could absorb job opportunity in term of translation as a lot of people could speak
Chinese language. It is notice that Chinese school had been taken place in this commune.
Expressed by Chinese translator for Synohydro Company thousands of workers have been
employed during the Kamchay hydropower dam construction but as the dam operation is
commenced recently only guards are still working126. It is recognized by group meeting with
local authorities and villagers that living conditions of people who worked, especially job as
translator; in Kamchay hydropower dam has improved remarkably during the construction
period.
Concerns Raised by Local People (after dam)
After talking with all stakeholders and local people some issues are concerned over
Kamchay hydropower dam including:
 Breaking/falling down of the dam127: speaking and listening from mouth to mouth
local people have concerned about falling down of the dam. To respond with this
concern PDoIME used to ask engineer of Sinohydro but it is answered with a strong
confident by this engineer and he has raised question back that “have you ever
heard that is there a falling down of the dam in the world”128. It is also impossible for
a case of Kamchay hydropower dam. The interviewed Chinese engineer also
125
Discussion and consultation with PDoIME on Feb 15, 2013
Site visit of Kamchay hydropower dam on Feb 16, 2013
127
Group meeting in Kampong Kreng and Mak Prang communes on Feb 16, 2013
128 Group meeting in Kampong Kreng and Mak Prang communes on Feb 16, 2013
126
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mentioned that Kamchay dam is built purely with concrete and it will last from 100 to
200 years129.
 Not proper management of the dam after BOT130: some local people are afraid of
the poor management and maintenance of dam after this dam will be given to the
government of Cambodia.
 Danger caused by power grid: As exploding of power wire has occurred about 3-4
times already, local people remain face such situation in the future if there is no
proper measure by the company131.
 High price of electricity: Kampot residents claimed that they should utilize electricity
with low price or without charge (three communes are close to the dam as promise)
as electricity is producing from Kamchay hydropower which is located in Kampot
province.
From the field observation, all key stakeholders/partners, both government institution and
local people, express significant advantage of Kamchay hydropower dam saying that the
dam prevents flood from Kamchay River and other areas. Group meeting with local
authorities and villagers in Snam Prampi village mentioned the Kamchay dam absolutely
helps avoid flood problem in the region. They said that, before the construction of dam, if the
rain is heavy and long lasting (2-3 days), water from the Kamchay stream flood in their
village. Houses, farms and rice paddies of other villages like Moit Peam village located on the
other side of the stream are flood and some time the flood last few days; flood severely
agricultural loss (death of durian) when the water retreat. However, since the Kamchay
hydropower dam has been constructed, flood has not occurred anymore132. The importance
of this promised function of Kamchay dam is also raised by Synohydro’s engineer.
Dam also helps regulate the water flow of the Kamchay stream. The interviewed department
officials, local authorise, especially the people living in Moit Peam village appreciate the fact
that Kamchay dam reduce volume of sea water from reaching their upper part of Kamchay
stream. According to villager Deputy Chief of Mak Prang commune, sea water sometime
reaches the upper part of Snam 7 village near and during that time, the people and farmer
cannot use the water for household or farming especially durian; those who growth durian
use pipe water connected from water or they need to dig wells near the stream and pump out
the water to irrigate their farms. But with ongoing water release from the dam, volume of sea
water decreased while fresh water volume increased; currently, less water lies down on the
bottom of the stream and fresh water on the top. Therefore, farmers can pump the fresh
water on the top of water stream for irrigation133. The positive impact that seem to satisfied
those people living in villages in the southern part of the Kamchay stream is a rural road 134
built by Sinohydro for transporting construction materials and equipment to dam construction
site as well as for laying out the electricity grid connecting from the dam. Local people and
authorities in Moit Meap village said that previously there was no road to access the village
from the national road #3. The villagers have to take boat to other side of the stream, for
example Snam 7 village, where road condition is good, so that they can go to Kampot
provincial town irrigation135. The villagers raise that this limit of road access lead to the
increased cost of product and as well as material. One villager claim that building a house
during that time in his village costs twice compare to building the same house in Kampot
Discussion with Mr. Chen ZiJian, Sinohydro’s engineer during visit site of Kamchay hydropower dam on Feb
16, 2013
130 Discussion and consultation with PDoIME on Feb 15, 2013
131 Group meeting in Kampong Kreng communes on Feb 16, 2013
132 Group meeting with local authorities and villagers in Mak Prang commune on Feb 16, 2013
133 Personal communication with first deputy chief of Makprang commune on 15 Feb 2013
134 To avoid damage to the existing asphalt road to Kamchay dam, the company was ordered to build alternative
road for construction activities
135 Personal communication with first deputy chief of Makprang commune on 15 Feb 2013
129
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provincial town136. As reported by the official from Mak Prang commune, the Sinohydro also
paid compensation to households who have their land or houses affected by the
development this access road and electricity grid. Mark Prang commune chief claimed that
the provision of this access road even provide an opportunity for his commune to later
develop 3 more villages roads for his people. Such commune development was not possible
previously due to the difficulty in importing construction material and equipment137. This
access road also establish a better link between farmers and market, with which farmers can
easily transport their agricultural products to the market in Kampot provincial town, compared
before as local people need to take boats138.
Actually, there is no detailed research about the situation of endanger or migrating fish
species in Kamchay stream, even though the EIA report of Kamchay dam has expressed this
such concern. Local people and fisher men met during the data collection period cannot
answer whether certain fish species has lost. However, those fisher men notice the increase
of fish stock139. The increased fished stock is significant in reservoir of dam#1 after the dam
commission in 2011 until 2012. However, fishers also notice slightly decline of the fish from
mid of 2013 because of, as explained by fisher, the volume of water in reservoir of dam#1
has significantly increased140. The people in Mak Prang commune has also mentioned the
same phenomenon about fish stock in reservoir of dam#1. However, they claimed that local
people who depend on fisheries generally suffer from changing of water flow caused by the
Kamchay hydropower dam, which result in the decrease of incomes compared to the period
before constructing the dam141. This is because not all fisher men can to fishing in the
reservoir of dam#1; but some of them keep fishing at the lower part of the Kamchay dam.
Those who can go fishing in the reservoir of dam #1142, some people claim that villagers are
allowed to fish near the dam but it has to be about 300 m far away from dam#1 because the
company considers about safety of local people143. As claim by a fisher man and certain local
people, some fisher men in the reservoir of dam#1 can catch fish around 20kg per day144.
Tourism sector is a well-known occupation of people in Tek chhu district, especially those
who live in Snam 7 village, an area adjacent to lower Dam No2. As forecast in the Kamchay
hydropower’s EIA report (2011) and as found by Mark (2012) during the construction phase,
the water quality of water downstream was not good and smelly. Early 2013 (more than a
year), the research team also found that the quality of water after the construction phase was
still not good enough for consumption as well as for tourist to play in. This might be because
the fact that water is not enough in Kamchay stream. This shortage of water in Kamchay
stream can be confirmed when the interviewed Chinese engineer informed the study team
that the company is saving water during the first few years so that water in reservoir of dam
#1 reaches a required level 152 metres so that all turbines can be run145. During that time,
the studied team notice light brown sediment in the water as well as on rocks in the bottom of
the stream. This poor quality and less water in Kamchay stream during the construction
period and a period a year after the construction were understood and claimed by the
vendors are the cost of tourism decline in the area.
This means that local people’s incomes have decreased compared to the period before the
construction. However, they notice that their incomes have slightly increased after more than
136
Personal communication with local people in Moit Peam village on 27 Oct 2013
Personal communication with first deputy chief of Makprang commune on 15 Feb 2013
138 Group meeting with local authorities and villagers in Mak Prang commune on Feb 16, 2013
139 Personal communication with fisher in Moit Meap village on 27 Oct 2013
140 Ibid
141 Mak Prang village chief during group meeting in Kampong Kreng commune on Feb 16, 2013
142 Personal communication with fisher in Moit Meap village on 27 Oct 2013
143Group meeting with local authorities and villagers in Kampong Kreng commune on Feb 16, 2013
144 Personal communication with fisher man, local people and vendor at Snam 7 villages on 27 Oct 2013
145
Discussion with Mr. Chen ZiJian, Sinohydro’s engineer during visit site of Kamchay hydropower dam on Feb
16, 2013
137
Page-64-
a year from the construction146. According Mak Prang village chief, number of vendors who
sell in Teuk Chhu resort has switched their direction to sell in Kep province as decreasing of
visitors is the main reason147. According to the most recent follow-up late 2013, the water
quality of Kamchay stream is much better and more water, especially during rainy season.
Certain interviewed vendor, feel not so disappointed, even though they said that before dam
is better. Those vendors also said that the decrease of tourist in the area is not solely
because the presence of Kamchay dam, but there are more interesting places flourished in
Kampot province such as Bokor National Park148.
Kamchay hydropower dam construction has impact on livelihood of people who depend on
bamboo and NTFPs collection. When the construction start, the construction company
blocked the way used by NTFP collectors. The blockage make those local people, especially
rattan and bamboo collector as well as bamboo-basket makers so angry that they collectively
protest against the company. However, with the solution from provincial and local authorise,
people are allowed to use the way again149. Until recently, after the reservoir of dam No1 was
filled up with water, the road used by those NTFP collectors was flooded, pushing most of the
people to use locally made ferries which are run by certain local people. Water also floods
around half of the bamboo forest collected by the people150. Before dam, people spend only
one day to collect a bunch of bamboo which can be sell at 30,000 KHR; they transport the
bamboo mostly by their bicycle. However, after dam, they have to spend more time in the
forest. Usually they spend 2 nights and 3 days to collect 5 bunches of bamboos, but they
have to pay 1,500 KHR for a round of ferry, and another 1,500 KHR for truck to transport
their bamboo as the load is too big for bicycle. According to calculation, the income earned
before and after dam do not significantly decrease, but people raise the concern that they
need to pack food to eat in the forest, and they have to stay overnight in the forest facing
many dangers, especially malaria; moreover, dam also reduce the stock of bamboo151. As
claimed by Mak Prang commune chief that the number of bamboo collectors is increasing of
collectors152, which means that the bamboo stock might be under pressure as well.
5.2.6. Design Issues of Kamchay Hydropower Dam
Until now, it is suspicious among the public about the generation capacity of Kamchay dam.
With full operation in rainy season, the dam could produce up to 193.25 MW (SAWAC, 2011).
However, recently Kamchay hydropower dam faces the lack of water and the electricity
generation runs lower than its capacity. The dam operates its turbine only from Monday to
Friday. In March 2013, EDC was anonymously quoted by The Cambodia Daily Newspaper
that Kamchay dam was operating at only 10 percent (around 20 MW) capacity due to the lack
of water during dry season, which is the cause of electricity black out in Phnom Penh153.
However, claimed by Hun Sen, Prime Minister of Cambodia on February 23, 2013 during the
inauguration ceremony of Kirirom III hydropower in Koh Kong province, Kamchay dam
produce up to 60MW out of its full capacity of 193 MW.
Electricity is the first purpose of building the Kamchay hydropower dam (SAWAC, 2011). The
discussion and consultation with all stakeholders, especially PDoIM, clearly reveals that
electricity produced by Kamchay dam has been being used to serving high demand of
146
Group meeting with local authorities and villagers in Mak Prang commune on Feb 16, 2013
Mak Prang village chief during group meeting with local authorities and villagers in Kampong Kreng commune
on Feb 16, 2013
148 Discussion and consultation with Provincial Department of Tourism (PDoT) on Feb 15, 2013 and personal
communication with vendor in Snam 7 village on 27 Oct 2013
149 Personal communication with Snam 7 village chief and basket maker on 27 Oct 2013
150 Personal communication with bamboo collector in Moit Peam village on 27 Oct 2013
151 Ibid
152 Personal communication with Mak Prang commune chief during group meeting with local authorities and
villagers on 16 Feb 2013
153 Cambodia Daily Newspaper, volume 54, issue 54 on 23 March 2013
147
Page-65-
electricity in Phnom Penh city. Before the construction, the local people used to hear about
the rumor that they the three communes affected by Kamchay dam will be allowed to use the
electricity for free154. However, those local people who used to rely on resources from this
river are not able to utilize electricity from the dam155. The people, even people in Kampot
provincial town, have been using electricity imported many miles from Viet Nam, with the
tariff higher than the tariff in Phnom Penh. However, the price of electricity is lower (920
KHR) than the price before the dam of 1,100 KHR/Kwh. However, certain local villager such
as Moit Peam villages located closest to Kamchay dam and where their house roof is a few
dozen metres from the Kamchay dam’s power grid still are not able to enjoy such decreased
electricity of 920 KHR/kWh. They are still using low quality and limited duration electricity with
very high price of 2000 KHR/kWh sold by private company who invest in extended private
grid connecting the imported electricity156. When asked about benefit sharing related concept
regarding the development of this Kamchay dam, the interviewed people do not express any
concern about their loss as they said that there is not significant loss from the dam. But they
absolutely mention about lower prices of electricity from Kamchay dam157.
As stated in Kamchay dam’s EIA report, agriculture irritation is also one of the purposes of
the dam. In practice, water from the dam seems to be far from meeting agricultural demands
while the company make use of all water flow potential for electricity generation. If agriculture
sector was seriously considered, dam design would be managed in a way that water can be
used for agricultural purposes especially in the three districts of Kampot province including
Dorng Tong, Teuk Chhu and Chhuk districts158. However, the local people do not traditionally
prefer to cultivate rice along the Kamchay stream and almost all of their rice paddies rely
mainly on rain water. Since before the dam, almost no water is extracted for uses for
agricultural purpose, but it flows directly to the sea. Therefore, building dam or not does not
really negatively affect local people even though at the moment the dam cannot provide
water for irrigation purpose159. However, according to official from department of agriculture, it
is a good way to extract benefits from the water; but the interviewed government officials
believe that the current Kamchay design is the only best option in the context of Cambodia if
taking the issues of financial source constrain into consideration160. Kampong Kreng
commune chief mentioned that water from Kamchay stream from June to November
becomes brackish water, and then it directly flows to the sea161. It is observed that benefits
from the dam related to water for agricultural sectors seem do not appear yet. However, most
visited provincial department hope that if Cambodia has enough electricity such as from other
hydropower dams, then water will be considered to be more effectively distributed for
agricultural purposes.
5.2.7. Financial Flows of Kamchay Hydropower Dam
It is understandable that EDC, on behalf of the government of Cambodia, and Shinohydro are
the only actors who are gaining from the financial flow of Kamchay hydropower dam.
Sinohydro is getting incomes from selling electricity to ECD with an agreed upon rate which is
allegedly to be 350 KHR/kWh (rumors). EDC as the electricity distributor to users [in Phnom
Penh at the moment] is charging users with another higher rate of 750 KHR/kWh. This
means that, if the alleged Shinohydro’s selling rate is true, EDC gets approximately 100%
income in this business. The government actually gains more financially if we include other
revenues from taxes during the dam operation. Shinohydro’s selling rate is so closed to
154
Personal communication with Moit Peam villagers on 27 Oct 2013
Group meeting with local authorities and villagers on 16 Feb 2013 (Moit Peam village, 29 October 2013)
156 Personal communication with first deputy chief of Makprang commune on 15 Feb 2013
157 Personal communication with with people in Kampong Kreng and Makprang commune on 27 Oct 2013
158 Discussion and consultation with PDoA on 15 Feb 2013
159 Group meeting with local authorities and villagers in Kampong Kreng commune on 16 Feb 2013
160
Interviewed with Kampot PoDOWRAM on 15 Feb 2013
161 Group meeting with local authorities and villagers in Kampong Kreng commune on 16 Feb 2013
155
Page-66-
public; all of the interviewed KIs cannot informed the team about the about the rate. “It is the
secret agreement between Shinohydro and EDC” said the interviewed Shinohydro’s
Engineer.
Figure 11: Electricity Distribution and Financial Flow of Kamchay Hydropower Dam
EDC
Sinohydro
- Invests USD 280.54
million
- 44 years of BOT
- Produce electricity and
sell to EDC
Electric Fee
Rate #1
Buying
agreement
- Purchase/distribute
electricity
- Purchase electricity
from Shinohydro at rate
#1, and sell at rate #2
- Order Shinohydro to
run or stop the
production
Electric Fee
Rate #2
Energy users
- Phnom Penh Residents
- Future users: mega
industry in Kampot,
Kampong Som, and
Special Economic Zone
- Electricity flow
- Financial flow
Source: Field survey (b), 2013
5.2.8. Livelihood Reconstitution
As the full EIA report was not approved while the construction is ongoing, it means that no
clear comprehensive Environmental Management Plan (EMP) is in place. During the
construction phase, it is apparent that no full plan was taken by the company and local
authorities to cope with the project’s impacts. Case-by-case solution was used whenever the
issue happened or after people took to the streets to protest (Mark, 2012). Even though the
working groups both national and provincial level to monitor the EMP of Kamchay dam was
established, it seems that the cohesiveness and the cooperation among all involved
institution is very limited. It is observed that the concept of EMP and EMP-related information
of the Kamchay dam were limited among most of the interviewed provincial departments.
Since the dam commences late 2011, all involved provincial departments do not have
specific plan to monitor the project. As stated in the Sub-decree 72 (1999), the Ministry of
Environment (MOE) is the main ministry to flow up the implementation of EMP as promised in
the EIA report.
However, in reality, Kampot Provincial Department of Environment (PDoE) claimed that EMP
is running not so well due to very limited cooperation with the company; Sinohydro, the
investment company of Kamchay dam, has been working closely only with Kampot Provincial
Department of Industry, Mine and Energy (PDoIME) and Kampot EDC. Both PDoE and
PDoIME all mentioned that as Kamchay dam is a national program and it is firmly managed
their ministries national level; their departments’ responsibilities to coordinate activities when
informed or planned by national level. Actually, PDoIME raised that all huge technical issues
will be responsible by committee from the MIME162. In SAWAC report (2011), the Sinohydro
set aside USD 17.5 million for environment protection works—USD 12 million during
construction period, and USD 5.5 million for the last 40 years. After a dam below the second
dam was built to preserve fish species, local fish species will be released into the reservoir
for 10 years (100,000 fishes per year) (SAWAC 2011).
162
Discussion and consultation with PDoIME on 15 Feb 2013
Page-67-
Chapter 7: Conclusion
In 2011, since almost all of the approved and commissioned hydropower development projects
in Cambodia are technically and financially supported by foreign donor or private investment
companies. But recently, there are the involvements of local private investors in the large scale
hydropower project in the form of joint venture, for example the case of Lower Sesan 2 dam.
This involvement of foreign party in hydropower development is due to Cambodia has limited
resources to implement such project. In the case of LS2 dam, it is also noted that there is a
change of hydropower investor from Viet Nam to China that is the country play significant role
in hydropower as well as other infrastructure development in Cambodia. Even though the
change of investor’s shares is claimed to be because the financial problem of Vietnams side,
the move toward China is seen to be in parallel with the current strong economic and political
ties between the two countries. The evidence shows that in last decades, hydropower dams
have been constructed in the country in order to meet the electricity demands associated with
rapid economic growths in the sense of industrialization, and promotion of service sector for
national development. Hydropower dam is expected to help the country solve the dependency
on expensive imported electricity from neighbouring countries. The selection of hydropower as
a corner stone of energy policy of Cambodia was party pushed by the untapped water
resources as well as the global and regional trend toward renewable energy. The selection of
hydropower, especially the large scale one, is also encouraged by the belief that large scale is
more efficient and the availability of financial resource and the investor.
The RGC does not reject the possible impacts caused by hydropower project, but stresses that
the project are considered thoroughly to ensure to get the win-win solution that the country get
the electricity and the negative impacts are reduced. Considering the impact of the hydropower
dam, the RGC, at least at the moment, approve only the construction of the project that are on
Mekong River’s mainstream, which are expected to produce electricity to support the domestic
electricity demand. However, the RGC does not reject the construction of mainstream dam, for
instance, Xayaburi dam in Lao PDR, if there is scientific study showing that the impact is
acceptable.
The construction of hydropower dams, especially in the Mekong mainstream, has been a
controversial issue among concerned stakeholders, as some significant studies show severe
negative impacts from dams including changes in ecology, change in water quantity and quality
in the river, and social and economic aspects. The result is that most of the affected villagers
have deep concerns regarding their losses. The government is trying to justify the development
of hydropower with the demand to meet national electricity demands, which are a focus on
macro scale, the society as a whole, while making use of the resources which was depend on
other parts of the countries. Responding to the mounting concern over the impact of the dam,
the government claimed that Cambodia will not build mega dam on the Mekong River’s
mainstream by 2030 even though certain large scale like Sambo and Stung Treng dam are
already included in the long-term hydropower development plan.
EIA is an aid for decision making tool; however, draft EIA law is still on its way. The EIA
implementation has been under strong criticism by civil society organizations. Decision making
is expected to help the government decide dam design option, dam location, as well as
mitigation measure needed to minimize the negative impact while increase the positive impact.
However, experiences show that EIA’s was not an absolute factor supporting hydropower
decision making in Cambodia. This can be explained as a waste majorities of existing projects
in Cambodia was carried out without EIA study, even though those projects, as stated by EIA
sub-decree to be subjected EIA studies. Another example is the case of Kamchay hydropower
which is a large scale dam and where full EIA was completed too late, leaving the effectiveness
of EMP implementation during the construction phase in suspicious. However, the issues was
improved with the following case of Lower Sesan 2 dam, where the full EIA report was well
completed for the decision of dam approval in 2012. However, criticism still exists over the
Page-68-
quality of the EIA report, when insufficient public participation and limited scope of the study
were raised and found by civil societies. Meanwhile, it is also noted that, even though still
limited, civil societies are gradually open to the process of hydropower decision making and
changes is noted to a better condition regarding the development of hydropower development
in Cambodia. Regardless the quality of the EIA study, another concern was raised over the
implementation of the promised EMP or measures needed for negative impact mitigations,
which are always constrained by the limited capacity and the authorities as well as the
relationship of follow-up organization at provincial level (MOE) with the main ministry of the
project and the investor to make sure the agreed-upon mitigation plan is effectively enforced.
The issue of equal wealth distribution is a big challenge during the fast growing country like
Cambodia. Effort is taken to ensure that the poor or the marginalized people gain benefit from
development activities in the countries. In term of hydropower development, the purpose is to
generate electricity to fuel the economy. Those who are affected or will-be-affected are
promised with restoration program and intervention. However, it seems that Cambodia does
have clear standard for compensation, but it is done on a case-by-case basis. By the existing
law, the government was given a favor to move the project forward, even though the problem of
expropriation is unsolved and handover the pending problem to the court, which creates more
suspicion about the fairness fair compensation. The implementation of the promised livelihood
restoration, for example in the case of Kamchay hydropower, was not clear in term of
implementation. This not include how good the EIA and EMP is prepared for the project. This
limitation will be serious if no improvement is made in the case of LS2 dam where the impact is
much bigger and more diversity.
To get a better distribution of benefit of hydropower dam, deeper study over the impact must be
consider and included. This includes director and indirect impact on both upstream and stream
village which must be value in economic term and therefore, proper interment must be in place.
The example of cultural and spiritual loss of the local people at LS2 dam site is a case of
unconsidered loss, and must be considered seriously to maintain the way of life of the people
which is generally seen as a movement on the same way to sustainable development. Even
though the LS2 dam project is still on paper, concerns have been mounting over the negative
impacts especially from civil society organizations. This concern derives from the actually
negative transboundary impact the local people is suffering from hydropower dams in Viet
Nam’s territory, as well as the improved knowledge of the local people with the support from
civil society organization and the increased access to media. People are seen to turn to depend
more on civil society organization bring their voice to national level, hoping that their problem
will be considered and solved.
The hydropower dam and surrounding natural resources were seen to be used for the benefits
and popularity of political parties under the context of democracy. Moreover, propaganda is
used in the campaign for or against dam development project. As a result, a shift of political
support exists, when the affected people exercise their right in a democratic processes in a
hope that their concerns and requests are responded and fulfilled. The change of political
support from the ruling party to the opposition party, might not an ideal choice for a win-win
solution in the context of LS2 dam, but it is absolutely a message to the government as well as
the investment company that things has to be checked in terms of the promised mitigation
measure, the interaction with the affected people, as well as CSOs and other stakeholders
which need to be improved.
Page-69-
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