China's Hydropower Miscalculation

China's Hydropower Miscalculation
Publication: China Brief Volume: 12 Issue: 11
May 25, 2012
By Sabine Johnson-Reiser

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China's Jinsha River, literally the "Golden Sands" River, could soon
live up to its rich name. The approximately 2300-km long upstream
section of the Yangtze River is the site of up to 25, planned
large-scale (50 MW and above) hydropower projects (Caixun, May 4;
Dongfang Zaobao, May 3). China's state-run hydropower companies, local
governments, and energy-hungry cities in the more developed, eastern
provinces stand to profit from hydropower construction and electricity
generation. Driven by Beijing's energy and climate goals, this new dam
building rush, however, will reduce China's climate change adaptation
capacity and hurt relationships with neighboring countries without
providing the emission-free electricity Beijing is seeking.

China's status as the world's largest CO2 emitter has put increasing
pressure�both domestic and international�on Beijing to curb national
emissions (Climate Progress, December 7, 2011). In response, the
government has laid out a set of binding targets in the 12th Five Year
Plan: an 11.4 percent increase in the use of non-fossil fuel in primary
energy consumption; a 16 percent decrease in energy consumption per unit
of GDP; and a 17 percent decrease in CO2 emissions per unit of GDP by
2015 [1]. Now, China is looking for sources of clean, emission-free and
sustainable electricity to fulfill ever-growing demand and meet
renewable energy and emission targets. More large scale hydropower is
wrongly thought to be one such source. Consequently, dozens of projects
are planned or already under construction on a number of rivers,
including 26 on the Lancang, headwater of the Mekong, 13 on the Nu,
headwater of the Salween, and 28 on the Yarlung Tsangpo, the headwater
of the Brahmaputra (Atlantic Sentinel, March 10; The Hindu, June 10, 2011).

The Misguided Hydropower Narrative

Addressing China's power sector�a major contributor to national
greenhouse gas emissions�is critical to reaching Beijing's emission
targets. A terawatt hour (TWh) of electricity generated in China
produces on average 70 percent more CO2 emissions than a TWh generated
in the United States, and China's power sector accounted for almost 50
percent of the country's CO2 emissions in 2009 (International Energy
Agency, World Energy Outlook 2011). Developments in the power sector
therefore will have a significant impact on the country's emission
trajectory.

The high carbon-intensity of China's electricity is due to the sector's
heavy reliance on coal. Coal, a very carbon-intensive fuel, is used to
generate around 80 percent of China's electricity (China Statistical
Yearbook 2011). Hydropower accounts for 16 percent of the country's
electricity generation with nuclear, wind and solar making up the
remainder. Hydropower advocates argue that shifting the energy mix from
carbon-intensive coal to more hydropower would benefit China's emission
targets.

This argument relies on the still widespread "clean, sustainable and
emission-free hydropower" narrative. Even the United Nations Framework
Convention on Climate Change tacitly supports this misconception by
making reports of greenhouse gas emissions from dam reservoirs voluntary
(International Rivers, December 2, 2011). Studies however have shown
that hydropower can be a major source of greenhouse gas. Organic
material from previously forested, but now flooded land and washed up
debris, accumulates and decomposes in the dam reservoirs, thereby
releasing large amounts of methane, a potent greenhouse gas. This
problem particularly affects hydropower projects in tropical areas,
where the vegetation is generally denser and more organic material is
accumulated in reservoirs. Some hydropower facilities in tropical areas
emit up to twice as much carbon dioxide per unit of electricity as coal
fired power plants [2]. As most of China's planned hydropower projects
are located in densely forested, subtropical southern and southwestern
provinces, new dam reservoirs are likely to become significant emission
sources.

Making Adaptation Harder

The 12th Five Year Plan also addresses climate change adaptation
strategies. Beijing wants to strengthen the country's "capacity to cope
with extreme climate incidents," thereby enhancing China's climate
change adaptation capacity [3]. Yet, the construction of more dams will
decrease China's capacity to cope with extreme climate incidents, which
are predicted to include more frequent and more severe record floods and
droughts [4].

First, the impacts of large-scale dams on wetlands and human settlement
patterns limit China's adaptation capacity�the ability to moderate
potential damages or cope with the consequences of climate change�as
they expose millions of people to climate change related risks. To
maximize power production, dams store water during the wet season and
release it during the dry season. This alteration of natural river flow
patterns impacts the health of natural flood storage systems, such as
downstream wetlands, lakes and marshes, often leading to their
disappearance. Thus, dams reduce the frequency of smaller floods, but
also decrease or eliminate wetlands' natural capacity to absorb water
and thus mitigate severe floods.

In addition, dams enable the conversion of wetlands to agricultural
farmland and provide downstream cities with electricity and water for
irrigation, industrial and household purposes, enabling and encouraging
their development and growth. Hydropower development therefore
contributes to population growth in downstream areas, which
simultaneously increases the number of people at risk of dam failure as
changing precipitation patterns could lead to floods that may exceed the
storage capacity of dams upstream.

The controversial Three Gorges Dam is a case in point. With a capacity
of 22.5 GW, the dam can generate up to 84.7 billion kWh of electricity
for cities in central, southern and eastern China, including the
downstream metropolis of Shanghai (Xinhua, October 26, 2010). While its
reservoir supplied the population in the middle and lower Yangtze with a
steady source of water, it also contributed to the drying up of Dongting
and Poyang Lake, two of China's largest freshwater lakes, during the
2011 drought (Shanghai Daily, June, 2, 2011; China Three Gorges
Corporation, August 7, 2009). Although the dam withstood its first major
flood test in 2010, whether the Three Gorges Dam will be able to contain
future, possibly worse, floods is uncertain (Xinhua, July 20, 2010). If
it fails, downstream residents will not be able to rely on natural
floodplains to mitigate the impact with possibly disastrous consequences
for life and property.

Second, the operation of large-scale dams exacerbates droughts in
downstream areas. In theory, reservoirs could provide short-term drought
relief, by releasing stored water for use downstream. Yet, below a
certain water level, the primary objective of hydropower
operators�maximizing electricity generation�suffers. The fact that the
central government had to order the China Three Gorges Corporation to
release water from the reservoir to alleviate the severe drought
downstream in 2011 suggests that hydropower operators are likely to put
power generation ahead of drought relief (South China Morning Post, May
25, 2011).

Third, dams make it harder for coastal cities to adapt to rising sea
levels. As freshwater is held back in reservoirs upstream, natural water
outflows at river deltas are reduced, contributing to a fall in coastal
groundwater tables. Combined with rising sea levels, this makes coastal
delta regions more susceptible to saltwater intrusion, which
contaminates coastal freshwater aquifers and makes water unfit for human
consumption [5]. More dams could exacerbate future saltwater intrusion
challenges for many coastal Chinese cities brought on by rising sea
levels. Shanghai, located in the Yangtze River Delta, is already
experiencing saltwater intrusion, which research has linked to
variations in water discharge from the Three Gorges Dam (Scientific
American, October 13, 2009) [6].

Lastly, the expensive and long-lasting nature of hydropower
infrastructure makes it difficult or impossible to adapt them to future
changes in the environment, agricultural and economic activities and
human settlement patterns.

Large-scale dam construction is very costly. The record-setting Three
Gorges Dam cost approximately $25 billion. Even smaller projects like
the planned Xiaonanhai Dam on the Upper Yangtze cost up to $5.6 billion
(China Dialogue, March 9, 2011). China Post Securities analyst Shao
Minghui estimates the hydropower sector will need around $136 billion in
infrastructure investment by 2020 (Shanghai Daily, January 6, 2011). The
sheer size of this kind of investments often prompts path dependency�the
preference to continue even if better alternatives are available�as
investors look to realize promised returns on investment, and local
governments are unwilling to admit that there may have been better
development alternatives.

Furthermore, the design of hydropower dams is based on historical and
current river flows. While their lifespan ranges from 50 to 100 years,
climate change is likely to alter future river flows within decades.
Modifications to existing large-scale dams to accommodate these changes,
however, are either technically infeasible or very expensive. Dried up
rivers or changing river courses could turn dams into stranded assets,
because they, unlike solar or wind installations, cannot be moved. A
drought in 2011 caused a 28 percent reduction in hydropower output,
resulting in 1000 factories and companies in Guizhou suspending
operations and showing even temporary reductions in water flows can
result in significant power shortages (Xinhua, August 24, 2011).

Damming International Relationships

China's dam building rush will have negative impacts on relationships
with neighboring countries. Furthermore, national hydropower companies'
overseas venture may harm China's international reputation.

China's territory encompasses parts of 18 of Asia's major international
river basins. Moreover, China's position along these river basins is
predominantly upstream, and, in the case of the Brahmaputra, the Mekong,
and the Salween, at the source. Hydropower development in China
therefore has international impact, and affects China's relationships
with its downstream riparian neighbors, including Bangladesh, Cambodia,
India, Laos, Myanmar, Thailand and Vietnam. The construction of cascades
of large-scale hydropower dams along rivers in China's territory affects
the water quantity and quality downstream. While the exact extent of
these dams' negative impact on water availability, fish populations and
consequently downstream populations may be unknown, the existence of
such effects is certain.

Upstream dams also provide some control over the timing and amount of
water flow in the rivers affected. People downstream therefore may feel
that Beijing rather than nature controls their water and their welfare.
Admittedly, upstream China does not control the entire water flow of
these rivers as water volumes generally increase along the river. Yet,
as river basins are highly complex, and the precise amounts of water
inflows at particular sections are hard to measure, citizens of
countries downstream may perceive China to be in full control. Indian
newspapers, for example, write of China's "superior upper riparian
positions" and "unique position of controlling international rivers,"
and suspect the country of secretly diverting water from the
Yarlung-TsangpoRiver (Hindustan Times, March 2; India Today, August 19,
2011). In 2010, when severe drought hit the Mekong, farmers and
fishermen in countries downstream blamed China and its hydropower
stations for the disaster, despite China's assurance that it collected
only "four percent of the river's water" (China Daily, April 9, 2010;
New York Times, April 1, 2010). Regardless of the validity of these
suspicions, given China's geographic position, more hydropower
construction will further strain relationships with already apprehensive
neighbors and nations downstream.

Furthermore, for about a decade now, Chinese state-run hydropower
companies have increasingly looked abroad to market the experience and
technology gained in domestic projects. More domestic dam building is
likely to make these companies even more internationally competitive as
they gain further technical expertise and financial resources. Yet, the
nature of many of these overseas ventures may harm China's international
image.

As Europe and North America have turned away from the construction of
large dams, Chinese companies armed with newfound skills have sought
projects in other Asian, African and South American nations�many of
which lack strong legal and political institutions, environmental and
regulatory oversight and suffer from corruption and instability. Chinese
banks and companies currently are involved in about 300 projects in 66
countries, including Angola, Burma, Cambodia, Ethiopia, Iran, Sierra
Leone and Sudan (International Rivers, May 1). Due to these problems,
many of the projects are high risk, involve human rights violations by
local governments and fail to be built according to international
environmental and safety standards. In the long run, this reflects
negatively upon Chinese companies and ultimately the country as a whole.

The Myitsone Dam on the Irrawaddy in Burma illustrates this point.
Located in Kachin State, home to a strong separatist movement and site
of frequent, armed clashes between the Burmese military and the Kachin
Independence Army, the project was supposed to be financed and built by
the China Power Investment Corporation, before President Thein Sein
suspended it in 2011 (The Irrawaddy, September 21, 2011).Myitsone holds
a special cultural and religious significance for the Kachin, who revere
the area as the birthplace of their culture. Should construction move
forward, the result is likely to be viewed as a symbol of China's lack
of cultural sensibilities and disregard for local minority groups (China
Dialogue, March 28, 2011).

Conclusion and Recommendations

Beijing's focus on hydropower to achieve energy and emission targets
largely ignores or downplays large-scale dams' negative impacts on the
climate, the country's adaptation ability and relations with neighbors
as well as China's international reputation. Yet, there are a range of
alternatives to large dams.

Greater focus on energy efficiency could provide huge energy savings.
For example, China's cement industry alone could achieve primary energy
savings of 23 percent through the implementation of international best
practices [7]. In the power sector, the government could accelerate its
efforts to replace small, inefficient power plants, with more efficient
supercritical and ultra-supercritical power plants, as well as combined
heat and electricity cogeneration plants. More efficient appliances and
lighting could reduce household electricity consumption, a growing part
of China's total consumption. This could be achieved through programs
similar to Energy Star in the United States.

Additionally, all existing alternative energy infrastructure should be
connected to the power grid. As of 2011, 30 percent of China's wind
power capacity, for example, was not yet connected to the grid (Xinhua,
February 24). At the end of 2008, small hydropower plants numbered
50,000, many of which were built decades ago and are equipped with
outdated, inefficient technology (China Daily, January 7, 2009). Prior
to building new projects, existing infrastructure should be surveyed,
and where necessary retrofitted with new technology to be more productive.

While less impressive in scale than highly visible mega-dams, these
alternatives could alleviate expected energy shortages, and help Beijing
achieve its targets without the negative consequences and future risks
associated with large scale dams.

Notes:

1. Twelfth Five Year Plan, available in Chinese and English,
respectively, news.xinhuanet.com/politics/2010-10/27/c_12708501.htm and
cbi.typepad.com/china_direct/2011/05/chinas-twelfth-five-new-plan-the-full-english-version.html

2. William Steinhurst, Patrick Knight, and Melissa Schultz, Hydropower
Greenhouse Gas Emissions, Cambridge, MA: Synapse Energy Economics,
February 14, 2012.
www.clf.org/wp-content/uploads/2012/02/Hydropower-GHG-Emissions-Feb.-14-2012.pdf

3. Ibid.

4. China's Policies and Actions for Addressing Climate Change,
Information Office of the State Council of the People's Republic of
China, October 2008, www.gov.cn/english/2008-10/29/content_1134544.htm

5. Lester Brown, Eco-Economy: Building and Economy for the Earth, New
York : W.W. Norton, 2001, especially Chapter 2.

6. Qiang An, Yanqing Wu, Shauna Taylor and Bin Zhao, "Influence of the
Three Gorges Dam on Saltwater Intrusion in the Yangtze Estuary,"
Environmental Geology, No. 56, 2009, pp. 1679�1686.

7. Lynn Price, Ali Hasanbeigi, Hongyou Lu, and Wang Lan, Analysis of
Energy-Efficiency Opportunities for the Cement Industry in Shandong
Province, China, Lawrence Berkeley National Laboratory, October 2009
china.lbl.gov/publications/analysis-energy-efficiency-opportunities-cement-industry-shandong-province-china
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