Fox keeping the geese in Nepal: NORAD approves developers' environmental impact assessment
By Harald Eraker
NORAD has supported Statkraft's hydro-electric power plant Khimti Khola in Nepal with NOK 230 million. The support has among other things been used to carry out environmental studies of the project - studies concluding that the power plant's impact on the environment and socio-economic conditions are minor as seen in a hydro-power context. The problem with these assessments is that they have been carried out by Norconsult (partly owned by Statkraft) and Butwal Power Company (BPC). Statkraft and BPC own 90% of the company that owns Khimti Khola power plant - subsequently the environmental studies are not independent under NORAD's guidelines. The Norwegian Water Resources and Energy Administration (NVE), which has been asked by NORAD to review the project, also comments on this. The NVE still says that NORAD should be able to look at its review of the project as a guarantee for independence, and NORAD agrees.
"NORAD is in breach of its own guidelines. Our failure to point this out is a slip-up," says adviser in the Directorate for Nature Management (DN), Svein Terje Båtvik. The DN is one of several agencies that in 1994 were requested by the NVE to assess the environmental impact of the project. Although presenting a number of critical remarks to the plans, the DN chose to approve it.
"We had doubts, but compared to other power plants that we have had something to do with, this was better. Besides, NORAD has told us that for projects in developing countries, environmental considerations should count a little less," says Båtvik.
Statkraft in Nepal
The hydro-electric power plant Khimti I is owned by the company Himal Power Ltd, which in turn is owned by Statkraft (73%), Kværner (5%), ABB Kraft (5%), and the Nepalese company Butwal Power Company (17%).
Norwatch Newsletter 2/96