VZCZCXRO9358
RR RUEHCHI RUEHDT RUEHHM RUEHNH
DE RUEHHI #0415/01 1020126
ZNR UUUUU ZZH
R 110126Z APR 08
FM AMEMBASSY HANOI
TO RUEHC/SECSTATE WASHDC 7585
INFO RUEHHM/AMCONSUL HO CHI MINH 4562
RUCNASE/ASEAN MEMBER COLLECTIVE
RUEHC/DEPT OF INTERIOR WASHINGTON DC
RHMFIUU/DEPT OF ENERGY WASHINGTON DC
RUCPDOC/DEPT OF COMMERCE WASHINGTON DC

UNCLAS SECTION 01 OF 02 HANOI 000415 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: EAID ECON SENV ENRG TRGY SOCI IBRD AID VM
SUBJECT: VIETNAM'S LARGEST HYDROELECTRIC DAM RISES IN SON LA 
 
REF: (A) Hanoi 359 ("Vietnam To Build First MDB-Financed Dam"); 
(B) Hanoi 1865 ("In Vietnam The Future Is Coal") 
 
HANOI 00000415  001.2 OF 002 
 
 
¶1. (U) Summary:  As part of an ambitious plan to add 50,000 
megawatts of electricity to the national grid by 2015, the 
Government of Vietnam (GVN) is building what will be the country's 
largest hydroelectric dam in northwestern Vietnam.  The 2,400 MW Son 
La Hydropower Project (SLHP) will enter service with one turbine in 
2010, with one additional turbine coming online about every six 
months thereafter through 2012.  To make way for the 44,000-hectare 
reservoir, the GVN is resettling 91,000 people, the largest 
resettlement in Vietnam's history.  End Summary. 
 
THE LARGEST DAM PROJECT 
----------------------- 
 
¶2. (SBU) State-run Electricity of Vietnam (EVN) is currently 
building what will be Vietnam's largest hydroelectric dam, the 
six-turbine, 2,400 MW Son La Hydropower Project.  (Note: By 
comparison, Washington state's Grand Coulee Dam, the largest 
producer of hydroelectric power in the United States and third 
largest in the world, generates 6,480 MW with 24 turbines.  China's 
Three Gorges Dam, the world's largest power producer, will generate 
22,500 MW with 34 turbines when fully operational.)  Each of Son 
La's six turbines will generate 400 MW of electricity.  EVN Vice 
Project Director Luu The Bieu told Econoff that the dam would enter 
service with one turbine in 2010 with one additional turbine coming 
online about every six months thereafter through 2012.  Although Son 
La will be Vietnam's largest producer of hydroelectricity, the dam 
will rank behind the Phu My III gas-fired power station (operated by 
BP Group in southern Vietnam's Ba Ria-Vung Tau Province), which 
generates up to 3,900 MW of electricity - 40 percent of Vietnam's 
current power demand. 
 
¶3. (U) The GVN expects electricity consumption to grow by 17 to 20 
percent annually over the next ten years and has an ambitious plan 
to add 50,000 MW of electricity, including 14,050 MW of hydropower, 
to the national grid by 2015.  SLHP is the second of four major dams 
that EVN is building on the Da (Black) River, a major tributary of 
the Red River.  The first, the 1,920 MW Hoa Binh Dam, entered 
service in 1988 and is currently the largest hydroelectric generator 
in Vietnam.  The third and fourth, the 560 MW Houi Quang, and 1200 
MW Lai Chau hydropower projects, will enter service in 2012 and 
2014, respectively. 
 
WORKFORCE REQUIRED 
------------------ 
 
¶4. (SBU) EVN Deputy Technical Manager Bui Phuong Nam said that 
around 10,000 workers were currently laboring at the dam site.  At 
the peak of construction in 2010, the workforce would grow to 15,000 
to 18,000 workers, he said.  SLHP's four primary contractors, all 
state-owned firms under the Ministry of Construction, include the 
Song Da Corporation, LICOGI, Truong Son and LILAMA.  Each company 
has a responsibility to hire and organize its own labor force, he 
explained, with the vast majority of workers recruited from other 
regions of the country.  Later, Nam led Econoff on a tour of the 
nearby company town that EVN built from the ground up to house the 
thousands of workers. 
 
MASSIVE RESETTLEMENT TO MAKE WAY 
-------------------------------- 
 
¶5. (SBU) The GVN is relocating 91,000 people, or 18,950 households, 
from 10 different ethnic minority groups to make way for the 44,000 
hectare, 215-meter high reservoir.  The relocation, which spans 
three provinces, including Son La, Lai Chau and Dien Bien, is the 
largest resettlement in Vietnam's history.  (By comparison, China 
relocated an estimated 2 million people to make way for the Three 
Gorges Dam).  The GVN is moving most of the inhabitants from 50 to 
100 kilometers away from their homes.  Vice Director Bieu told 
Econoff that the government has already resettled approximately 50 
percent of the inhabitants and would relocate the remainder by June 
2010, when the reservoir would start to fill. 
 
¶6. (SBU) Bieu said the inhabitants, chiefly farmers of rice and 
corn, would be given new land.  Many observers, however, have 
criticized the parcel size - 400 square meters per household - as 
inadequate to support a large family.  Moreover, the Asian 
Development Bank recently estimated that flooding would reduce 
downstream inhabitants' income by 10 to 50 percent by 2010.  Almost 
all of the resettlement provisions are contained in the GVN's 
Decision 459, which the Prime Minister signed in March 2006.  The 
decree authorizes monetary support for the purchase of rice and 
other foodstuffs for two years, and for the construction of new 
homes, schools, and public services. 
 
THE ENVIRONMENTAL ANGLE 
 
HANOI 00000415  002.2 OF 002 
 
 
----------------------- 
 
¶7. (SBU) To help draft the dam's environmental impact assessment 
(EIA), Bieu said EVN hired both a Vietnamese consulting company and 
the U.S. consulting firm Pricewaterhouse Coopers.  He said the 
Ministry of Natural Resources and Environment (MONRE) subsequently 
approved the EIA "according to Vietnamese law."  Bieu was vague, 
however, when asked whether EVN had made the document available for 
public examination.  "EVN has given local inhabitants an opportunity 
to both review and comment on the document," he said. 
 
MICHALAK 
 
 
 
1