69418 New Approaches for Medium-Scale Hydropower Development in Vietnam Lessons from Preparation of the Trung Son Hydropower Project Defne Gencer and Richard Spencer Copyright © 2012 The International Bank for Reconstruction and Development The World Bank Group 1818 H Street, NW Washington, DC 20433, USA All rights reserved First printing: May 2012 Photo credits: World Bank staff and consultants, including Victoria Minoian. This document is a product of the staff of the World Bank Group. The findings, interpretations, and conclusions expressed in this report are entirely those of the authors and should not be attributed in any manner to the World Bank, or its affiliated organizations, or to members of its board of executive directors or the countries they represent.The World Bank does not guarantee the accuracy of the data included in this publication and accepts no responsibility whatsoever for any consequence of their use. 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The views expressed in this publication are those of the authors and not necessarily those of the Australian Agency for International Development (AusAID). ii Contents Preface..............................................................................................................................................................................v Acknowledgments...........................................................................................................................................................vii Acronyms and Abbreviations....................................................................................................................................... viii ............................................................................................................................................ix Key Points and Conclusions. Part A. Introduction to Trung Son Hydropower Project......................................................... 1 Description of the Project............................................................................................................................................... 2 Overview of Social and Environmental Impacts............................................................................................................ 4 Part B. Highlights of the Trung Son Hydropower Project.......................................................6 Project Screening and Identification.............................................................................................................................. 6 Review and assessment of policy framework for environmental and social aspects of . hydropower development....................................................................................................................................... 7 ........................................................................................................................................................ 8 Project selection. Building on lessons learned from past project preparation experience.................................................................. 8 Environmental Aspects.................................................................................................................................................... 9 Initial assessment...................................................................................................................................................... 9 Supplementary studies............................................................................................................................................ 10 Social Aspects................................................................................................................................................................ 12 Dam Safety..................................................................................................................................................................... 16 ......................................................................................... 17 Communications: Consultation and Community Relations. ........................................................................................................................................................... 17 Consultations. .................................................................................................................................................. 20 Ongoing disclosure. The Community Relations Program......................................................................................................................... 21 An additional channel for addressing grievances................................................................................................... 21 Economic Analysis......................................................................................................................................................... 23 Analysis of alternatives............................................................................................................................................ 23 Risk analysis............................................................................................................................................................. 24 Assessment of greenhouse gas impacts.................................................................................................................. 24 Identifying and Managing Critical Implementation Risks........................................................................................... 25 Managing focus on outcomes.................................................................................................................................. 25 Incorporation of social and environmental mitigation into project scope and results indicators....................... 26 Governance and accountability............................................................................................................................... 26 Advisory bodies........................................................................................................................................................ 27 Adaptive management............................................................................................................................................. 27 Lessons from Preparation of the Trung Son Hydropower Project iii Part C. Conclusions from the Preparation Experience......................................................... 29 Why Does the Trung Son Hydropower Project Experience Matter?............................................................................. 29 What Approaches Worked Well in Preparing Trung Son?............................................................................................ 31 .................... 31 Building on country systems, incorporating international practice, and enhancing local capacity. How the preparation teams worked together......................................................................................................... 31 Quality and the trade-off between speed and depth.............................................................................................. 32 .................................................................................................................... 32 What Could Have Been Done Differently?. Concluding Thoughts for Successful Project Implementation..................................................................................... 33 Figures 1 Map of project area.................................................................................................................................................... 2 2 Examples of materials used in consultations......................................................................................................... 18 3 Probability distribution of ERR............................................................................................................................... 24 Tables 1 Comparison of TSHPP with select major infrastructure projects............................................................................ 8 2 Select environmental and social impact indicators from initial screening of Trung Son .................................... 11 3 Comparison of power densities for Brazilian hydropower projects and Trung Son.............................................. 25 Boxes 1 The Environmental Management Plan for the Reservoir Area............................................................................... 13 2 Resettlement, Livelihood and Ethnic Minorities Development for Trung Son....................................................... 15 3 Principles and Procedures of the Independent Grievance Mechanism................................................................. 22 iv New Approaches for Medium-Scale Hydropower Development in Vietnam Preface The challenge for hydropower is in implementa- Purpose of This Paper tion—maintaining quality project development under the pressure to meet tight timelines imposed This paper provides an overview of the Trung Son by rapidly growing demand for electricity. With hydropower project preparation experience and demands to accelerate project implementation, the highlights the innovative features of the project, pri- question is how to achieve the best results, especially marily focusing on the adoption of new approaches in delivering new sources of electricity efficiently, at in project design and integration of social and envi- least cost, with minimum environmental and social ronmental concerns. Through disseminating the impacts and ensuring subsequent safe operation of Trung Son project experience, this paper is intended the plant.Vietnam has made great progress in devel- to contribute to the sustainable scale-up of medium- oping a modern framework for project selection, scale hydropower in Vietnam, based on practical design, and management, but delays and cost over- experience. runs are frequent, though by no means confined to This paper was funded by the Australian Agency either hydropower projects or the power sector as for International Development (AusAID) as part a whole. In reservoir resettlement work, Vietnam’s of a broader activity supporting sustainable hydro- policy and financial commitment is high, but there is power development in Vietnam. Resources from the room for improvement in terms of complementing AusAID–East Asia Infrastructure for Growth Trust the focus on resettlement-site infrastructure with Fund supplemented those available to the World attention to livelihoods restoration. Environmental Bank task team in charge of the project. These funds assessment work has improved, but enhancements were made available to can be made in defining and ensuring that mitiga- tion measures are carried out. Dam safety practices z provide targeted expert assistance for support- can benefit from gradually moving away from rules- ing project preparation efforts to adopt new based systems that may not devote adequate atten- approaches in the Trung Son hydropower proj- tion to the risks to life and property in the event ect case, with a focus on enhancing local capac- of unexpected flood events. Mitigating and manag- ity to implement international good practices in ing risks proactively so that they do not become a medium-scale hydropower development; z evaluate the practical experiences during project distraction during project implementation requires institutions and mechanisms that can provide timely preparation in adopting new approaches, assess- and effective solutions. ing their advantages and disadvantages in the Vietnamese context, providing evaluations of the lessons learned, and making recommendations for the future; v z disseminate these lessons and views for future Target Audience work; and This paper may benefit Vietnamese government z work with government agencies and companies agencies and entities involved in hydropower devel- on plans to institutionalize the most promising opment, nongovernmental organizations (NGOs) and relevant new approaches developed through and sector practitioners in other countries interested the Trung Son project. in sustainable hydropower development, and World Examples of specific activities for which AusAID Bank staff preparing hydropower projects in East funds were used include the hiring of expert inter- Asia or elsewhere in the world. national consultants to advise on and participate in consultations between the project developer and Organization affected communities to discuss the proposed envi- This paper is made up of three parts: ronmental and social mitigation measures; assisting Vietnam Electricity (EVN) to review lessons learned Part A introduces the Trung Son Hydropower from the first round of consultations; analyzing eco- Project. It contains basic information about the nomic aspects of the project and its fit within the project and its background, scope, implementa- system expansion plan; helping the investor prepare tion arrangements, and financing. It also provides for negotiation of the Power Purchase Agreement an overview of the main social and environmental by carrying out extensive financial analyses of the impacts expected from the project, and the mitiga- financial implications of various options; and build- tion measures designed to address them. ing capacity at EVN throughout the project prepa- Part B presents highlights from the Trung Son ration process. Hydropower Project, focusing on the main themes The full set of outputs produced during the prep- addressed during preparation. It is not intended to aration of the project, whether financed by EVN, be an exhaustive review of each aspect of the proj- the World Bank, or AusAID funds, have been dis- ect, rather, it emphasizes the aspects that are innova- closed on the project website1 and provide practical tive in the context of hydropower development in examples of the application of good practice in dam Vietnam. safety; environmental assessment and mitigation; Part C contains the authors’ conclusions about resettlement program design; livelihoods restoration why the Trung Son Hydropower Project experi- planning for project-impacted persons; consultation ence matters, and discusses the features that make with local people, most of whom are from ethnic it a good example for future scale-up of sustainable minorities; grievance mechanisms; economic and hydropower development in Vietnam as well as for financial analysis; and greenhouse gas accounting. hydropower development in other countries. 1. http://www.trungsonhp.vn. vi New Approaches for Medium-Scale Hydropower Development in Vietnam Acknowledgments This paper was prepared by Defne Gencer and Trung Son Hydropower Development Company. Richard Spencer. It relies on official project doc- The authors also thank Jennifer Sara and Vijay umentation, background reports, and underlying Jagannathan of the World Bank for encouraging analyses generated during the preparation of the them to pursue this topic. Trung Son Hydropower Project. The authors would also like to recognize all The paper benefited from information, insights, those who contributed to the broader activity sup- and feedback provided by individuals who were core porting sustainable hydropower development in team members during project preparation or outside Vietnam and the Trung Son Hydropower Project advisers with knowledge of the project.They include in particular. They are too numerous to mention Stephen Lintner, Alessandro Palmieri, Panneer by name and include representatives of the govern- Selvam, Juan Quintero, John Butler, Daniel Gibson, ment of Vietnam, Vietnam Electricity, Trung Son William Rex, and George Ledec, among others.The Hydropower Company, World Bank staff past and paper also benefited from inputs from the Vietnam present, NGOs, and most important, those who are energy team, and we would particularly like to thank affected by the project. Ky Hong Tran for his unstinting help and support. The authors would like to recognize editor Sherrie Last, the team thanks AusAID for providing the Brown, graphic designer Laura Johnson, and Adam resources to make this activity and its final product Broadfoot, Assistant Project Manager, World Bank possible. The team would like to acknowledge the Printing and Multimedia Services, for their contri- contributions from Aldo Baietti and Hye-Yon Kim butions to the production of this publication. for their role in facilitating cooperation between the team and AusAID. The authors would like to acknowledge the leadership of Mr. Pham Le Thanh, Mr. Dinh Quang None of those who have been so generous with Tri, Mr. Luong Van Dai, and Mr. Pham Viet Hung their help are answerable for any errors, all of which of Vietnam Electricity and Mr. Ngo Viet Hai, Mr. are the responsibility of the authors alone. Dang Ngoc Trieu, and Mr. Hoang Ngoc Hien of vii Acronyms and Abbreviations AusAID Australian Agency for International m meter Development m3 cubic meter Bank World Bank MW megawatt CLIP Community Livelihood Improvement NT2 Nam Theun 2 hydropower project Plan NGO nongovernmental organization CO2 carbon dioxide NPT National Power Transmission EIA environmental impact assessment Corporation EMDP Ethnic Minorities Development Plan O&M operations and maintenance EMP Environmental Management Plan PDR People’s Democratic Republic EVN Vietnam Electricity RLDP Resettlement, Livelihoods and Ethnic GHG greenhouse gas Minorities Development Program GWh gigawatt-hour RP Resettlement Plan IBRD International Bank for Reconstruction SESIA Supplementary Environmental and and Development Social Impact Analysis IGP Independent Grievance Panel TSHPCo Trung Son Hydropower Company km kilometer TSHPMB Trung Son Hydropower Management km 2 square kilometer Board kV kilovolt TSHPP Trung Son Hydropower Plant viii New Approaches for Medium-Scale Hydropower Development in Vietnam Key Points and Conclusions Why does the Trung Son Hydropower households are affected by the whole project, of Project matter? The Trung Son Hydropower whom about three-quarters will be affected by Project is the first hydropower project in Vietnam the reservoir. financed by the World Bank. This project matters z Completion of an environmental impact assess- because it is a practical example of a project prepared ment that more fully considers all of the main according to international good practices in tech- impacts of the project, and provides greater detail nical design, analysis of alternatives, and particularly on mitigation measures to be adopted. environmental, social, and dam safety elements. The z Incorporation of approaches for ensuring the project preparation process has been instrumental design safety of the dam that focus on results in introducing new approaches to ensuring sustain- under a series of plausible scenarios, not simply ability of medium-scale hydropower development in conformity with a static safety design standard Vietnam. If replicated, the Trung Son example can applicable to all dams of a specified height and contribute to scale-up of hydropower development size. in Vietnam as well as in other countries interested in z Adoption of an integrated and adequately bud- sustainable hydropower development in the future. geted livelihoods restoration plan, which is a first The lessons from preparation of this operation could in Vietnam for either a domestically or donor- apply to similar operations, especially in how the financed hydropower project. government, EVN, and the Bank worked in part- z Capturing of social and environmental mitiga- nership on challenging issues. tion measures as part of the project objective. z The government’s willingness to borrow for What are the innovations and highlights social and environmental impact mitigation, and of Trung Son? The Trung Son Hydropower dedication of funds provided by the International Project reflects international good practice and is Bank for Reconstruction and Development to innovative in the Vietnamese context in a variety of improved resettlement, livelihoods development, respects, as summarized below. support for ethnic minorities, and environmental z Preparations of a low-impact project for the protection during project implementation. scale of energy it is designed to produce. When z Setting aside of project funds for continued finan- completed, the power plant will have an installed cial and technical assistance to improve social, capacity of 260 MW, but it is expected to have environmental, and dam safety practices in the a relatively low impact compared with other country’s hydropower sector, which effectively hydropower. The project has a comparatively builds into the project the potential replication of small reservoir area of 13.13 km2 and affects an sustainable hydropower development. area with low population density—about 2,300 Lessons from Preparation of the Trung Son Hydropower Project ix z Preparation and mandating of a Governance and z During project preparation, all parties made Accountability Framework, the implementation major efforts to address social and environmental of which in its entirety was made binding for issues and challenges identified, based on interna- Trung Son Hydropower Company (TSHPCo) tional good practice for sustainable hydropower through covenants in the project’s legal agree- development, especially with regard to dam safety ments, and is reflected in the Project Operations and social and environmental factors. Manual. z Key environmental and social programs were z Establishment of an independent grievance prepared by building on country systems. Gap mechanism to complement the official channels analysis between Vietnamese and World Bank to allow project-affected communities to voice standards—in which gaps were identified and their concerns. additional reports were commissioned to address z Assignment of a formal role to continued involve- the gaps—were prepared primarily by senior ment by international technical experts through Vietnamese experts with support from interna- entities such as the Project Technical Advisory tional consultants. Panel, the Social and Environmental Panel of z Various international experts were engaged in Experts, and the Independent Grievance Panel, project preparation and design of social and envi- among others. ronmental mitigation measures and will continue z Incorporation of an adaptive management mech- to advise on technical construction, operations, anism, in recognition of the inability to fully and dam safety issues. predict and confirm all impacts, and hence miti- z During preparation, the focus was on building gation measures, in advance of the implemen- capacity of Vietnamese staff and encouraging tation of a large infrastructure project, thereby learning by doing. Extensive training was pro- building realism, proactivity, and responsiveness vided to TSHPCo Project Management Bureau into the project design. staff on a range of subjects, including project prep- z Continued focus on disclosure of project infor- aration, implementation, and management; prep- mation and key documents as they become avail- aration and implementation of action plans and able, as part of a communications strategy. measures for environmental impact mitigation; and assessment, minimization, and mitigation of What is noteworthy about the Trung Son social impacts of the project during preparation project preparation effort? Preparation for and implementation.The specific capacity-build- the project served as an opportunity to strengthen ing initiatives were complemented by a focus on country systems, develop local capacity for sustained the preparation of all major reports primarily by results during implementation, conduct exten- senior Vietnamese experts. This focus on learning sive consultations, and address governance issues. by doing differs significantly from an approach Noteworthy aspects of preparation for the Trung that relies on international consultants preparing Son Hydropower Project are summarized below. key project documents on behalf of a borrower, in z Early on in project preparation, various options varying degrees of isolation from the borrower’s were comprehensively analyzed to optimize team. Furthermore, throughout project prepara- hydropower generation while minimizing envi- tion, significant transfer of knowledge took place ronmental and other impacts, especially the between international and national experts. number of people affected by the project and z In light of the multipurpose nature of the proj- area flooded. An equally comprehensive eco- ect, a more complete assessment was conducted nomic analysis provided a solid understanding of to determine the optimal management of water alternatives. controlled by the reservoir to meet environmen- tal requirements, flood protection, and power generation needs. x New Approaches for Medium-Scale Hydropower Development in Vietnam z Local communities were engaged in broader were received positively, with enthusiasm and discussions on how the project might best meet strong ownership on the part of EVN and local development aspirations and contribute to TSHPCO leadership, and have since been instru- improved local livelihoods, with efforts to incor- mental in informing the broader governance and porate these ideas into project and resettlement anticorruption dialogue with Vietnam. With the design work. agreement of EVN and TSHPCo management, z Various innovative approaches were used during recommendations from the assessment are being preparation of the project and of programs for piloted in the project and will be fed back to the mitigating the project’s potential impacts, par- rest of EVN as the project progresses. ticularly consultations in local languages using a What did the task team learn? Lessons variety of visual media, integrated with a com- from the Trung Son project experience are sum- prehensive communications strategy. Project marized below, and are explored in further detail design and programs for mitigating the project’s throughout the paper. potential impacts were updated or changed after the consultations. z Building on country systems provides an oppor- z Early and open consultations were undertaken tunity to achieve broader development impacts with local NGOs and civil society, including while encouraging ownership at the country advocacy NGOs with international linkages. level. This cooperation helped enhance mutual under- z Composition of the preparation teams is critical standing between the Bank, EVN, and the local on both the client’s and the Bank’s side and needs NGOs, the aims of which are broadly similar to draw on the widest range of skills possible. to the Bank’s safeguard policies, in that they are The use of high-quality international and local focused on ensuring that the people affected by consultants to support preparation is preferable the project benefit from it and that their con- to the use of large firms. The benefits to project cerns are properly addressed. preparation far outweigh the heavier manage- z During preparation, special attention was dedi- ment burden. cated to governance and accountability aspects, z Methodological coordination can be challenging starting with targeted capacity building for indi- with diverse teams of varying experience; pair- viduals involved in project management, focus- ing international and local consultants, then using ing on improving understanding of processes and a coordinating author is effective in bringing specific implementation arrangements for ensur- complex documents together but requires close ing transparency, integrity, and accountability. As attention to sequencing. part of project preparation, and at EVN’s request, z If all parties are able to accept that they do not the Bank initiated an assessment of the fraud and have all the answers, they are bound to disclose, corruption environment in the power sector.The consult, listen to grievances, and adapt as well as assessment and its findings and recommendations change the nature of the dialogue. Lessons from Preparation of the Trung Son Hydropower Project xi Part A Introduction to Trung Son Hydropower Project Electricity demand in Vietnam has been growing the benefits of the latter two are minor in compari- at 14–15 percent per year for the past several years, son with power generation. and is expected to continue to grow as the country In addition to supplying least-cost power to moves toward middle-income status.Vietnam envis- Vietnam’s electricity system, the project will con- ages growth of all major domestic power generation tribute to the adoption of improved social, environ- sources and of electricity imports to meet its bur- mental, and dam safety practices in the hydropower geoning energy needs. sector.The mitigation and management of social and Hydropower is a vital source of renewable energy, environmental impacts and safety of the project fol- and is part of the least-cost solution to meeting low international good practices, and during both Vietnam’s rapidly growing demand.The country has preparation and implementation, the focus has been hydropower potential of 25,560 MW, in addition on building Vietnam Electricity’s (EVN’s) capac- to sizable resources of coal and gas and a renewable ity to prepare hydropower projects to international energy potential of possibly more than 13,000 MW. standards. The country’s least-cost expansion plan for the next decade includes 22 hydropower plants, providing about 4,800 MW of new capacity. Alongside a few relatively large plants in this expansion plan, such as the Son La (2,400 MW) and Lai Chau (1,200 MW) hydropower plants on the Da River, the main focus of hydropower development during the next decade will be on medium-scale projects (typically 100–600 MW each) distributed throughout the country. The Trung Son Hydropower Project includes the development, construction, and operation of a power plant on the Ma River in northwest Vietnam. The 260 MW Trung Son Hydropower Plant (TSHPP) is designed as a multipurpose project, providing power generation, flood control, and irrigation, although Lessons from Preparation of the Trung Son Hydropower Project 1 Figure 1. Map of project area EVN, the country’s main electricity generator, The area is remote and sparsely populated with will build the TSHPP with financial and technical extremely poor communities composed largely of support from the World Bank. It is the first hydro- ethnic minorities, where infrastructure and services power project financed by the Bank in Vietnam are underdeveloped and income sources other than and is the country’s first investment loan from agriculture and forestry are limited. the International Bank for Reconstruction and The project site was chosen based on detailed Development (IBRD). analyses to optimize hydropower generation while minimizing environmental and other impacts, espe- Description of the Project cially the number of people affected by the proj- The objective of the project is to supply least-cost ect and the area flooded. The project includes electric power in a safe and environmentally and resettlement, compensation, and restoration of the socially sustainable way. livelihoods of the people who will be directly or indirectly affected by the construction of the dam Area affected by the project. The project and the ancillary works. It also includes mitigation site is located at the junction of Son La, Thanh Hoa, of the environmental consequences of construction and Hoa Binh provinces in northwestern Vietnam, and operation of the dam. In addition, the project with the plant in the territory of Trung Son com- provides financing for technical assistance to scale up mune, Quan Hoa district, Thanh Hoa province, hydropower in Vietnam by identifying and support- about 40 km east of the border with the Lao People’s ing preparation of one or more additional projects. Democratic Republic (PDR), following the course A map of the project area is presented in figure 1. of the Ma River. 2 New Approaches for Medium-Scale Hydropower Development in Vietnam Project features. The main features of the expected and unexpected impacts, direct or indi- project are presented below. rect, on households in the project area. z The capacity development and scale-up component z An 84.50 meter (m) dam, which will use water focuses on capacity building and continued tech- from the Ma River and release it back into the nical assistance, to contribute to the scale-up of river a few hundred m below the dam. environmentally and socially sustainable hydro- z A powerhouse containing four 65 megawatt power development in Vietnam. (MW) Francis turbines, each designed for a max- imum water head of about 72 m. Financing. The total project cost is estimated z A reservoir area of 13.13 square kilometers (km2), to be US$411.72 million, out of which, US$330 with total storage volume of 348 million cubic million is financed through a loan from the IBRD. meters (m3) and an active volume or flood con- Financing for the project was approved by the Board trol capacity2 of 112 million m3. of Executive Directors of the World Bank Group on z Expected generation of 1,019 gigawatt-hours per April 26, 2011. year (GWh/year), which is about 10 percent of The loan is financing equipment, civil works, the 10,000 GWh/year additional power genera- and technical assistance for the dam, reservoir, and tion expected to be required between 2010 and hydropower plant. Of the total IBRD financing, 2020, based on conservative estimates made after a sum of US$26 million is reserved for improved the 2008–09 global financial crisis. resettlement, livelihoods development, support for z Avoided net carbon dioxide (CO2) emissions as ethnic minorities, and environmental protection. An a result of the project are estimated to be about estimated amount of US$58.1 million is included 900,000 tons per year, taking into account the for physical and price contingencies as well as for additional, but low, emissions from the reservoir. front-end fees and other unallocated expenditures. The project is the first to dam the Ma River, Allocation of responsibilities among as contemplated by the Vietnamese Energy Master project entities. The main parties involved in the Plan, the Ma River Basin master plan, and the hydro- preparation and implementation of the project are power master plan. summarized below. Project components. The project has four components: z The dam and ancillary construction component pro- vides for the construction of the power plant and supporting structures. z The transmission line component is the means by which the generated power is moved to electric- ity consumers. z The social and environment impact mitigation com- ponent focuses on ensuring the environmentally sustainable and socially responsible construc- tion and operation of TSHPP, and comprises the programs to manage and mitigate the project’s 2. This active volume corresponds to about one day’s average daily in- flow for the wet season, and about 5.5 days average annual inflow. Maxi- mum outflow through the turbines running at 533 m3 per second would exhaust the storage volume in 58 hours. Lessons from Preparation of the Trung Son Hydropower Project 3 z Trung Son Hydropower Project Management Board the national transmission network. NPT enjoys (TSHPMB), a unit under EVN, was responsible substantial autonomy from EVN, with delegated for preparation of the project. A semiautonomous powers for procurement, financial management, department of EVN, TSHPMB was respon- and reporting. sible for ensuring the entire project was pre- z Works contractors, goods suppliers, and consulting firms pared according to government and World Bank are collectively responsible for construction, sup- requirements. ply of goods, and project management. Some z Trung Son Hydropower Company (TSHPCo) was works contractors will be responsible for imple- created by EVN as a wholly owned subsidiary mentation of those aspects of the Environmental of EVN and replaced TSHPMB shortly before Management Plan that are required under the the World Bank loan was negotiated. TSHPCo is contracts, including, for example, the remediation responsible for implementing the main project— of site works. planning and contracting for the dam and ancillary z In addition, responsibilities for the implemen- works, including construction of the power lines tation of the social and environmental mitiga- and substations up to 110 kV; the access road and tion component are shared between Province and bridges; and the social and environmental mitiga- District People’s Committees, TSHPCo, and contrac- tion measures, as expressed by Components 1 and tors responsible for construction work. This is further 3. It will also implement Component 4 on behalf discussed in Part B. of EVN, providing capacity building. TSHPCo Overview of Social and Environmental will remain a wholly owned subsidiary of EVN, Impacts into which all the assets of TSHPP will be placed. Staff at TSHPMB transferred to TSHPCo on its About 10,600 people in 2,327 households are creation.3 expected to be directly or indirectly affected by the z Vietnam Electricity is the project owner, and through project. Of those people, 7,012 live in the main proj- its corporate Appraisal, Planning, Procurement, ect area—reservoir, dam, and ancillary works con- and Finance and Accounting Departments, it is struction. The affected population consists largely of responsible for oversight of TSHPCo. A task force ethnic minorities:4 Thai, Muong, H’mong, and Kho consisting of representatives of these departments Mu. There are a small number of Kinh, which is the and the Director of TSHPCo will help EVN to majority ethnic group in Vietnam. oversee the project. From a social perspective, the primary concern is z The National Power Transmission Corporation to minimize and mitigate the impact of the resettle- (NPT), a wholly owned one-member company ment of people affected by the project, restoration of subsidiary of EVN, through its Northern Power their livelihoods, and addressing the needs of ethnic Projects Management Board is responsible for minorities in these very remote areas where rural the design, construction, commissioning, and poverty is prevalent, along with mitigating the effects operation of the 220 kV transmission line to associated with the arrival of a large workforce in evacuate power from the hydropower plant into the project area, including security challenges, spread of disease, and social tensions. 3. To allow the introduction of the Vietnam Competitive Generation Market, it is expected that EVN will be restructured and required to Key environmental impacts that may arise from transfer its generation assets into one or more generation companies the project concern hydrology and water quality; (Gencos) except for the strategic and multipurpose hydropower plants. protected areas, fish, and fisheries; impacts associated TSHPCo may eventually be transferred to another owner. The creation of the special purpose company is intended to ensure that critical cov- with worker camps and construction; health impacts; enants for the performance of the project can be retained with the new and physical cultural resources. owner.TSHPCo will sign a power purchase agreement with the Electric Power Trading Company, the actor in the Vietnam Competitive Genera- tion Market responsible for all power purchases from generators and all 4. In Vietnam, “ethnic minorities” is the preferred usage when referring power sales to distributors. to what the World Bank defines in OP 4.12 as Indigenous Peoples. 4 New Approaches for Medium-Scale Hydropower Development in Vietnam The major environmental and social impacts minorities, the H’mong, are potentially the most from the project are summarized below.5 vulnerable. z The resettlement of the population to new areas z The primary environmental consequences of the in the river basin is expected to put additional project stem from the dam and the reservoir it pressures on natural resources (forest, bam- will create. Construction of the access road and boo, and wildlife), especially in the Xuan Nha transmission lines is expected to have minor Nature Reserve in Son La Province, the Pu Hu impacts that can be easily mitigated. Nature Reserve in Thanh Hoa Province, and the z Beyond the impacts that could normally be Pa Co-Hang Kia Nature Reserve in Hoa Binh expected from the change in use of the land, the Province. construction of the dam itself was found to pose the highest environmental and social risk. At its The project triggers 8 out of 10 World Bank safe- peak, a labor force of about 4,000 workers will be guard policies:6 housed in camps for dam construction. Indirect z Environmental Assessment (OP/BP 4.01) impacts from them include about 400–1,000 z Natural Habitats (OP/BP 4.04) “camp followers” moving into the project area z Pest Management (OP/BP 4.09) prompted by the construction of the dam and the z Physical Cultural Resources (OP/BP 4.11) enhanced access provided by the improved roads. z Involuntary Resettlement (OP/BP 4.12) z Direct impacts on biodiversity are considered z Indigenous Peoples (OP/BP 4.10) minimal. The project will not flood any critical z Safety of Dams (OP/BP 4.37) natural habitat. z Projects on International Waterways (OP/BP z Fish migration in the Ma River occurs mainly in 7.50) the lower and middle segments of the river basin, up to 100 km from the river mouth, whereas the How the project’s social and environmental distance from the dam site to the river mouth impacts were identified and could be mitigated or is approximately 200 km. Movement of fish managed and how the requirements of the govern- upstream of Trung Son was not found to be prev- ment of Vietnam and the World Bank were met are alent.Therefore, the magnitude of the impacts on discussed in Part B. fish and fisheries is also estimated to be low. z The reservoir area does not have a rich cultural heritage value, but some paleontological sites identified in the area will be excavated before flooding. z About 98 percent of the people identified as affected by the project are from four eth- nic minority groups: the Thai, the Muong, the H’mong, and the Kho Mu. Thus, the project has the potential to disrupt cultural and social structures in the area, create additional pressure on community infrastructure and services, and increase the risk of spreading sexually transmitted diseases. The least-integrated of the four ethnic 5. Comprehensive detail on the social and environmental aspects of the project is available in Annex 11 of the Project Appraisal Document (World Bank Report No. 57910-VN) and the series of documents dis- 6. Details and latest information on World Bank safeguards policies can closed on the project website. be found at www.worldbank.org/safeguards. Lessons from Preparation of the Trung Son Hydropower Project 5 Part B Highlights of the Trung Son Hydropower Project This part discusses highlights of the Trung Son The summary of noteworthy features of project Hydropower Project, focusing on the preparation preparation and the resulting innovations is organized process. It is not intended to be an exhaustive review around seven main themes: project screening and of each aspect the project, but instead emphasizes identification; environmental aspects; social aspects; those that are innovative in the context of hydro- dam safety; communications, consultations, and com- power development in Vietnam. Greater detail munity relations; economic analysis; and identifying on the project is available in the Project Appraisal and managing critical implementation risks. Document, as well as in the set of more than 50 documents available on the Trung Son Hydropower Project Screening and Identification Project website.7 Technical screening to identify which power generation technology to support Foreseeing significant power sector investment needs in the coming years, the government and EVN lead- ers and officials requested direct World Bank financial support for one or more power generation invest- ment projects. Accounting for 70 percent of sector investment requirements and the bulk of the design, development, and construction effort, development of new generation capacity was the crux of Vietnam’s power investment and implementation challenge. On the financing side, power generation lent itself well to an opening for support from the IBRD. In 2004, the World Bank reviewed alterna- tive generation project options in Vietnam. The review took into account not only suggestions from the Ministry of Industry and Trade and EVN for hydro, coal-based, and gas-based power generation, 7. www.worldbank.org/vn/trungson. 6 New Approaches for Medium-Scale Hydropower Development in Vietnam but efforts also focused on energy conservation, Review and assessment of policy framework demand-side management, and transmission and for environmental and social aspects of distribution loss reduction. The review found that hydropower development given Vietnam’s need for economic development, The existing Vietnamese legal and policy frame- the increasing demand for electricity in general, and works for resettlement and environmental assess- peaking supply in particular, could not be accom- ment and mitigation were reviewed. The review modated by demand-side options alone.World Bank found these frameworks to be generally satisfac- assistance would also be important in project design, tory. There were (and still are) differences between development, and management: in an environment Vietnamese and World Bank policies, but there was of heavy pressure to bring new plants on line as fast also flexibility to accommodate those differences. as possible, the challenge was to design and build Weaknesses identified in the general policy frame- plants quickly and efficiently, but responsibly and work included lack of specific requirements for with a view to longer-term consequences. compensation of indirect losses of project-affected The central role that hydropower would play households; vague requirements for income restora- in Vietnam’s power sector development was high- tion for resettled households; and loose requirements lighted in the 2005 National Hydropower Plan, concerning consultation and monitoring and evalua- the outcome of a multiphase study completed with tion. Although several government regulations man- Scandinavian technical assistance. It assessed virtu- dated support to ethnic minorities, there were no ally all of the 30-odd projects included in the gov- specific requirements about how ethnic minorities ernment’s medium-scale hydropower development should be supported in the framework of projects. program. The analysis concluded that, with the goal On the environmental side, the legal framework was of providing almost 6,000 MW of power, Vietnam’s found to be clear and satisfactory about the needs program to develop the bulk of its medium-scale for assessment and mitigation plans, their basic pur- hydropower sites during the next 10 years would poses, and assignment of responsibilities. The Law provide a core contribution to the overall power on Environmental Protection (2005) introduced development program throughout the country. The requirements for conducting proper consultation as study included an assessment of a series of capac- part of the environmental assessment process. The ity expansion scenarios involving progressively less law also made Strategic Environment Assessments hydro and more thermal power development over mandatory for long-term plans such as the coun- time, finding that the cost of not developing the try’s hydropower development plan. The main issues hydro resources in Vietnam would be prohibitive. identified were related to the timing and quality of The assessment indicated that, in the development implementation. of the potential sites across Vietnam, planning and Vietnam’s policy basis for resettlement planning operational improvements could be made to opti- was solid, but the way in which that policy basis was mize complex choices and trade-offs to (a) maxi- translated into design and implementation guidelines mize multiple water control benefits; (b) minimize and, eventually, positive outcomes on the ground, adverse impacts, including negative social and could be improved. The screening process carried downstream impacts; and (c) maximize the value of out early on also highlighted that Vietnamese coun- electric power within the overall power system. terparts were searching for solutions to the most dif- The conclusion reached by the World Bank ficult core implementation issues related to reservoir review was that hydropower would allow the Bank resettlement, namely, detailed planning and program to provide the greatest added value, if the risks could execution for providing sustainable incomes for be either mitigated or managed adequately. resettled households, especially ethnic minorities. Lessons from Preparation of the Trung Son Hydropower Project 7 Vietnamese counterparts expressed keen interest in reservoir impacts in Laos PDR, which constrained techniques and approaches tried abroad, in lessons the full reservoir elevation to 164 m above sea level. from the experience of others, and in training and The resulting project configuration is rela- other support for practical efforts to improve the tively low impact for the amount of power output Vietnamese programs. expected, especially with regard to reservoir area, density of population affected, and likely carbon Project selection emissions. The reservoir created and the number Trung Son was one of several projects in the remain- of people affected, though significant, are by no ing inventory of candidates included in the govern- means out of the ordinary for hydropower projects ment’s medium-scale hydropower development or other infrastructure projects already being imple- program. This raised the question of whether there mented in Vietnam. Table 1 presents a comparison were better hydropower projects than Trung Son. of Trung Son Hydropower Project with other major An analysis of the optimization of capacity expan- infrastructure projects financed by the World Bank sion found Trung Son to be the most attractive. In in and around Vietnam, including in the urban and addition, when Trung Son was compared with the roads sectors. other potential hydropower projects on the basis of the main environmental attributes (loss of for- Building on lessons learned from past est, persons displaced, power density, and cost of project preparation experience energy), its high ranking was confirmed. Given that With the scope of the project broadly understood, it the power expansion strategy required the develop- was possible to review the key elements that would ment of Vietnam’s remaining economic hydropower have to be covered during project preparation. resource endowment,Trung Son stood out as one of Experiences with hydropower projects elsewhere in the most attractive projects. the world, and with the larger and more complex The master plan for development of the Ma infrastructure projects carried out in Vietnam, pro- River considered a range of sites and development vided a number of key lessons to guide preparation: options for the Trung Son project. The subsequent z According equal or higher priority to social and environ- evaluation of alternative Trung Son project config- mental issues during preparation and implementation. urations was based on a trade-off analysis between Hydropower projects are often led and imple- optimal hydropower generation on the one hand, mented by engineers, and technical issues domi- and environmental, social, and risk considerations nate management thinking. Environmental and on the other. The considerations taken into account social issues tend to be treated as secondary, and included minimizing geotechnical risks, minimizing implementation of mitigation plans often lags the number of project-affected persons, and avoiding behind technical progress. In consequence, the Table 1. Comparison of TSHPP with select major infrastructure projects Capacity Reservoir Country Project (MW) (km2) Affected households* People Vietnam Trung Son 260 13 2,327 10,591 Vietnam Son La Hydropower Plant 2,400 233 20,000 100,000 Lao PDR Nam Theun 2 Hydropower Plant 1,070 450 16,000 80,300 Vietnam Vietnam Urban Upgrading Project (urban) n.a. n.a. 21,621 80,000 Vietnam Expressways (roads) n.a. n.a. 6,194 30,000 Source: Authors’ compilation. * Includes reservoir resettled population, project lands, and the two downstream tributaries. Does not include population living in catchment area. 8 New Approaches for Medium-Scale Hydropower Development in Vietnam impacts of the project on people are more severe and last longer than necessary. High budgets do not equate to success; dedicated teams within implementing agencies are needed, as is reflec- tion of the social and environmental issues in the project objectives and design. z Designing with sufficient flexibility to incorporate les- sons learned during implementation. In complex projects, lessons learned early in implementation can be used to improve project outcomes, par- ticularly if there are long-term resettlement and livelihoods impacts. Advisory panels can be espe- cially effective by enabling a more objective view. Such panels’ terms of reference and composition should be informed by the specifics of the project and the needs of the implementing agencies, and should be regularly reviewed to ensure continu- Environmental Aspects ing relevance and appropriate staffing. During preparation of the project, significant z Ensuring readiness. In operations in Vietnam, resources were dedicated to developing a series of including in the energy sector, implementation plans to mitigate the project’s potential impacts, success has typically been constrained by the lack which are summarized in Part A, and discussed in of readiness at project initiation. Project stake- extensive detail in the Project Appraisal Document holders must have adequate capacity to undertake and other project documentation. While preparing their roles in the project. The key to readiness, these programs, EVN and the World Bank made sig- however, is ensuring that the main project activi- nificant efforts to ensure that the project not only ties have been well prepared and procurement is met the requirements of Vietnamese law and World under way. Providing technical assistance dur- Bank safeguard policies, but also that mitigation ing preparation to potential participants is also measures were based on international good practice important to ensuring readiness. for sustainable hydropower development with regard z Providing investment lending and technical assistance to environmental, social, and dam safety issues. This in one package. It is preferable to combine tech- section discusses the environmental aspects. Other nical assistance with investment lending for two sections address the social and dam safety aspects. reasons. First, investment lending on its own often results in slow uptake of new ideas because there Initial assessment are few opportunities for learning, and lessons learned cannot easily be disseminated. Second, The Trung Son Hydropower Project is rated technical assistance on its own does not facilitate “Category A” under World Bank Operational Policy learning by doing. (OP) 4.01 on Environmental Assessment in light z Streamlining fiduciary oversight and execution. of the scale of potential environmental and social Oversight by the Vietnamese government and impacts and the sensitivity of the project areas. The its agencies can be slow at times, particularly for Category A rating means that a project is likely to procurement and disbursement. Projects that have have significant adverse environmental impacts that minimized processing steps and approvals consis- are sensitive, diverse, or unprecedented. The impacts tent with sound management, and that encour- affect an area broader than the sites or facilities sub- age decision making, have done better than those ject to physical works.According to the Policy, a proj- with multiple layers of oversight and approval. ect rated Category A requires a full environmental Lessons from Preparation of the Trung Son Hydropower Project 9 impact assessment (EIA), which examines the proj- paper. In the table, the cells corresponding to Trung ect’s potential negative and positive environmental Son indicators are colored to show whether Trung impacts, compares them with those of feasible alter- Son is considered a “good” (green) or a “bad” dam natives—including the “without project” scenario— (red), or uncertain (yellow). Using these criteria, and recommends measures to prevent, minimize, Trung Son is in the “good” range for a significant mitigate, or compensate for adverse impacts and share of the indicators. improve environmental performance. This initial analysis allowed the team to identify Vietnamese environmental law also requires the additional data and studies that would be needed, preparation of an EIA. Accordingly, the first round of prepare terms of reference for each study, and pro- environmental impact studies had been undertaken vide guidance to EVN on the selection of consult- by EVN in 2003. This EIA was then updated in ing teams. Efforts were concentrated on the areas 2007, as required by Vietnamese regulations. These in which Trung Son’s performance was “bad” or studies were thoroughly reviewed by Vietnamese “uncertain.”The more innovative ways in which the authorities, and the updated EIA was approved by environmental impact mitigation frameworks were the Ministry of Natural Resources and Environment, developed are summarized below. as also required by Vietnamese law. z Environmental supervision and management of camps The approach for assessing the environmental and construction. During project preparation, spe- aspects of the Trung Son Hydropower Project was cific attention was focused on the management of to base preparation on the approved Vietnamese impacts from camps and the incoming construc- EIA, and provide support for TSHPMB counter- tion workers. Such impacts had usually not been parts to prepare a supplementary environmental and included in EIAs in Vietnam. It was agreed that social impact analysis (SESIA) and environmental the impacts of camps and construction workers management plan (EMP), instead of requiring the would be handled as part of the environmental Vietnamese documentation to be revised. This sup- management planning even though they might plementary work was intended to bring the current be considered social in some respects. This was preparation into compliance with Bank policies, a pragmatic decision to avoid overlaps and allow align it with international practice, and provide a the social team to focus on the resettlement and knowledge-transfer opportunity. livelihoods impacts of the project. The impacts from camps and construction workers were the Supplementary studies subject of intense discussions during project preparation, and their management is one of the The screening to identify the necessary supplemen- main components of the EMP. Another innova- tary work was based on the framework presented tion was the introduction of a requirement for in a 2003 paper on environmental criteria for site environmental supervision teams during con- selection of hydropower projects.8 This paper pro- struction. The detailed specifications developed vides a series of quantitative indicators for rating for the management of these impacts from camps and ranking proposed hydropower projects based and construction of TSHPP can be used in future on their likely adverse environmental impacts, using projects in Vietnam, and could be a useful input data that are relatively easy to obtain. to the development of standard practice in the Table 2 contains a select set of indicators for sector. TSHPP, based on the methodology presented in the z Natural habitats. Although TSHPP would not have any direct impacts on critical natural habi- 8. George Ledec and Juan Quintero, 2003, “Good Dams and Bad Dams: tats, indirect impacts on the three nature reserves Environmental Criteria for Site Selection of Hydroelectric Projects,” Sustainable Development Working Paper No. 16, World Bank, Wash- in the project area were considered significant. ington, DC. http://siteresources.worldbank.org/LACEXT/Resourc- The project provides easier access to this remote es/258553-1123250606139/Good_and_Bad_Dams_WP16.pdf. 10 New Approaches for Medium-Scale Hydropower Development in Vietnam Table 2. Select environmental and social impact indicators from initial screening of Trung Son Indicator Units Good dam site Bad dam site Trung Son Reservoir area/MW ha/MW low (<20) high (>100) 5.05 Water retention time days short (<180) long (>180) 16.5 Flooded biomass ton/ha little or none 10–20 extensive 200–600+ 24 Length of river impounded km short (as % of total long 38.5 (7.5%) length of river) Length of river left dry km little or none extensive 0 Likelihood of reservoir Froude number > 0.31 < 0.31 0.29; moderate tendency stratificationa Useful reservoir life years long (> 50–100) short (10–20) 150 Access road through forest km short long 20.4 Persons requiring people few or no people many people, urban areas, 9.4 resettlement displaced/MW indigenous communities Critical natural habitat number and ha low (minimal loss) high (even with wildlife Few ha of provincial reserve flooded; affected rescue efforts) 5.3 ha of natural forest Fish species and endemism diversity; few species, many species, including 198 fish species of 141 genera, 57 families, endemism no vulnerable vulnerable endemics and 13 orders. Little knowledge of migratory endemics patterns of fish. Cultural property affected indicative none to very little significant amount No known historic sites; potential for paleontological sites. Number of river tributaries number major (or many none (or just a few minor 1 major tributary 170 km downstream downstream minor) ones ones) (Chu River); however, flow increases by 50% from watershed drainage. Source: Authors’ compilation. a. Densimetric Froude number, derived from reservoir length, depth, flow, and volume. area now that the access road is complete. The has set a precedent that may make it easier for presence of 4,000–5,000 workers and camp fol- this valuable environmental tool to be included lowers will put additional pressures on natural in future hydropower projects in Vietnam. resources (from logging, poaching, and hunting), z Environmental flows. Vietnam’s regulatory and resettlement of families will move people framework does not require minimum river into new areas. These impacts could, in turn, be flows to maintain environmental conditions exacerbated by weak management and enforce- downstream—so-called environmental flows. ment in the reserves. The SESIA assessed these TSHPMB and its consultants carried out addi- impacts and proposed compensation measures to tional hydrological analysis, water use surveys, strengthen protection of the reserves. At the time and fish assessments downstream from the dam to of project preparation, the concept of compensa- determine the environmental flow. As a result of tion for loss of natural habitat was relatively new these efforts, the Trung Son project incorporates in Vietnam, and much discussion was needed for a minimum environmental flow requirement. it to gain acceptance. Though modest for the Through this real-world example of perform- Trung Son Hydropower Project, the introduction ing a minimum environmental flow analysis and of compensation and offsets for protected areas incorporating it into project design, the Trung Lessons from Preparation of the Trung Son Hydropower Project 11 Son preparation experience can benefit future The SESIA and the EMP, dated January 2011, projects in Vietnam. bring together, summarize, and update the findings of z Cumulative impacts. Even though the analysis of all previous studies and identify mitigation and com- cumulative impacts is not required in Vietnam, pensation plans and actions to address environmental it is widely practiced internationally. Consistent and social impacts caused by the project. The SESIA with the vision of incorporating international includes a comprehensive assessment of impacts and good practice into Trung Son preparation, the outlines the necessary measures to avoid, mitigate, EIA included a preliminary assessment of cumu- manage, and compensate for the potential adverse lative impacts, mainly on fish. Following this impacts identified. The SESIA also provides link- initial assessment, the EMP set aside funds for a ages with the Resettlement, Livelihoods and Ethnic more thorough assessment of cumulative impacts. Minorities Development Program (RLDP), which A first in Vietnam, the analysis can be repli- is discussed in greater detail below. The EMP for the cated, scaled up, and eventually become standard reservoir and downstream area identifies the prin- practice. ciples, approaches, procedures, and methods that will z Intact rivers. Based on the preliminary assessment be used to control and minimize the environmental of cumulative impacts, an “intact river approach” impacts of all construction and operational activi- in one of the branches of the Ma River was pro- ties associated with the project. It complements the posed, to maintain active fish populations in the SESIA and is a companion document to the RLDP. river when all planned dams in the catchment Box 1 presents a summary of the EMP. are built. The EMP includes terms of reference The project’s potential environmental impacts and budget to carry out a study of the possibility and associated mitigation measures are covered in a of identifying an intact branch and what would package of four documents: the original EIA, the be needed to keep it intact. Although it has been SESIA, the EMP for the reservoir and downstream proposed in another hydropower project in the area, and the EMP for the road. An environmen- country, this approach has never been studied or tal management framework for the transmission implemented in Vietnam. line was also prepared. The full set of environmental These additional studies required intense collabo- studies and underlying reports were disclosed on the ration between TSHPMB staff, international expert project website. consultants, local consultants, and World Bank team members. The World Bank team and international Social Aspects consultants spent significant time working with and An initial review of the project’s potential impacts building the capacity of local consultants on criti- made it clear that a considerable resettlement and cal issues, including water quality modeling, envi- livelihoods restoration program would be required ronmental impact assessment, management of camps to ensure compliance with World Bank safeguard and construction workers, and environmental design policies concerning Involuntary Resettlement (OP/ of roads, among others. The exhaustive prepara- BP 4.12) and Indigenous Peoples (OP/BP 4.10). tory work often required travel to the project site The Social Assessment emphasized the needs for to evaluate potential impacts and identify solutions livelihoods development among the communities firsthand. In these visits, concerted efforts were made expected to be affected. This applied particularly to to go beyond the easy access points and fully access the seven communes and one town adjacent to the the project site. Bank staff and international consul- reservoir and main construction site but also included tants joined local consultants and TSHPMB staff on the 325 households preliminarily estimated to be as many site visits as possible. affected by the transmission line, and the 486 house- holds affected by development of the access road. 12 New Approaches for Medium-Scale Hydropower Development in Vietnam Box 1. The Environmental Management Plan for the Reservoir Area The project’s main environmental issues are related to the upstream and downstream impacts on water quality, hydrology, health, and fish and fisheries; the impact of a construction workers’ camp housing about 4,000 people during the construction period; the impacts of auxiliary project components, including the access road and borrow pits; and indirect impacts on the area’s natural resources and biodiversity, including within three adjacent natural reserves. A number of management plans will be implemented throughout the construction and operation phases of the project, including the following: z Construction impact management plan—measures to minimize negative impacts of construction activities on local communities and the natural environment, to reduce the induced impacts of camp followers, to prevent pol- lution and ensure that hazardous materials are stored properly without risk to the environment. z Biodiversity and protected areas management plan—measures to ensure protection of local and regional biodi- versity and minimize project impacts on three adjacent protected areas. z Reservoir Clearing Plan—measures to minimize biomass loss as a result of reservoir clearing and to coordinate the timing of vegetation removal to allow salvage benefits to local communities. z Environmental monitoring plan—measures to ensure project compliance, measure the success of proposed miti- gation, continue baseline monitoring, and review environmental and social performance. z Community relations and safety plan—measures to inform local communities about the progress of the project and ensure community safety. z Regional health management plan—a plan to mitigate project impacts on the health of local people. z Physical cultural resources management plan—measures to prevent inadvertent loss of physical and cultural resources during project construction and operation. z Environmental management framework to address environmental issues during construction and operation of infrastructure to be built in resettlement sites. z Additional studies to provide more baseline information for the project, z Training and capacity building will be provided in all aspects of the EMP. Resettlement activities were split into three A Resettlement Plan (RP) with an integral Ethnic parts, reflecting different timing of completion of Minorities Development Plan (EMDP) was prepared, different portions of the project: access road con- disclosed, and implemented. Because the transmis- struction, main works for dam construction and res- sion line will not be required until the power plant is ervoir filling, and construction of the transmission completed and ready to export power to the grid, it line. Because the access road construction was set to was considered premature to prepare detailed design start before dam construction and reservoir filling, a and alignments. A Resettlement Policy Framework, separate set of safeguard instruments were prepared. Ethnic Minorities’ Planning Framework, and Lessons from Preparation of the Trung Son Hydropower Project 13 Environmental Guidelines EMDP, was completed, after comprehensive con- were prepared and adopted sultations with affected communities, civil society by the National Power organizations, and local and national authorities. Box Transmission Corporation 2 provides an overview of the resettlement, liveli- (NPT). During detailed hoods and ethnic minorities mitigation measures design, NPT will pre- developed under the project. pare an RP, EMDP, and Four points are particularly noteworthy with EMP. The rest of this sec- regard to the preparation of social aspects of the tion concentrates on the project, as summarized below. resettlement plan for the reservoir, construction, and z The reliance on domestic practice and exper- downstream areas. tise recognizes that country ownership, capacity, and interagency coordination are essential for The major innova- effective management of implementation under tion in the social aspects uncertain future circumstances. of the project is the focus z The emphasis on adaptive management, too, rec- on livelihoods restoration. ognizes that unquestioning adherence to plans Reservoir resettlement in Vietnam has historically will not work in a constantly changing environ- concentrated on compensation and resettlement site ment. Delivering material inputs may be unnec- infrastructure rather than on livelihoods restoration. essary and wasteful four years after they were International experience with hydropower develop- allocated in a planning process, and procedural ment clearly demonstrates that successful reservoir steps may not make sense when events fall out of resettlement, which is highly transformative, espe- an assumed sequence. To ensure the effectiveness cially with regard to livelihoods restoration, cannot of adaptive management, considerable effort was be seen as a linear process of planning, costing, and needed to clarify roles and define boundaries for implementing. The outcome is largely contingent what could be adapted and what should remain on the behavior and responsiveness of those affected intact. to changed (and changing) circumstances, including z The approach to livelihoods restoration is much the opportunities the project may attempt to provide. more open-ended compared with many other Having recognized the importance of changing cir- hydropower projects. Compensation for assets— cumstances and the need to focus on contingencies, and assuming that asset substitution is all that is EVN, the local authorities responsible for imple- needed—is insufficient and fails to recognize the mentation, and the World Bank approached the need for new skills and relationships imposed resettlement and livelihoods restoration problems by a move to new areas with unfamiliar soils, strategically, yet practically. In explicitly analyzing neighbors, and conditions. Intensive livelihoods and emphasizing the relationship between domes- planning has generally been based on designs tic practice and expertise on the one hand, and the developed by external experts, often devised international state of the art on the other hand, the years in advance, assuming fairly uniform levels need for capacity-building, adaptive management, of productivity among an “averaged” population. and contingency funding became clear.This negated The community livelihoods approach devised a standardized approach to livelihoods restoration for Trung Son intends to deliver material inputs, measures, and stepped beyond a narrow focus on training, and agricultural extension services to compliance within a Vietnamese context. those being resettled, but relies on community- As a result of these efforts, the comprehen- based livelihoods-planning processes intended to sive RLDP, which includes an RP, a Community allow each community to determine their own Livelihood Improvement Plan (CLIP), and an preferences based on their own circumstances, 14 New Approaches for Medium-Scale Hydropower Development in Vietnam Box 2. Resettlement, Livelihood and Ethnic Minorities Development for Trung Son A Policy Framework for Compensation, Resettlement and Rehabilitation of Project Affected Persons (RPF) was pre- pared and received the approval of the Prime Minister. It establishes the principles, objectives, and definitions to be used in resettlement planning and implementation. It defines affected persons and establishes eligibility criteria for compensation or other forms of assistance; describes the legal and institutional framework; establishes modes of asset valuation and compensation payment, and arrangements for consultation and participation; and sets out procedures for pursuing grievances. The RPF applies to all aspects of the project, including impacts associated with the dam construction area, reservoir impoundment, area for resettlement activities, and upstream or downstream impacts associated with loss of access to land or other resources, but not to the access road or transmission lines. The Trung Son Hydropower Project meets its social obligations to those affected by the project through the RLDP, which is made up of the RP, the CLIP, and the EMDP. The RLDP includes resettlement, rehabilitation, compensation, and livelihoods development measures that will improve, or at least maintain, people’s preproject living standards and income-earning capacity. It also includes activities to help ethnic minorities maintain their cultural identity. The RLDP also requires monitoring of households, and makes use of social accountability and grievance-reporting mechanisms. The main features of each plan follow: z The RP for the main project (dam and support works) is designed to provide full compensation to all individuals losing houses, land, or other assets as a result of construction, reservoir flooding, or downstream impacts of the dam, and to provide for effective relocation for households unable to stay in their current residences. z The CLIP enhances the capacity of communities affected by resettlement to restore and improve their livelihoods. Early piloting and vocational training needs assessments will be used to refine the CLIP and customize it for vil- lages and individuals. z The EMDP sets up a consultation and participation framework for use in all RLDP activities, and sets up measures to mitigate remaining risks for ethnic minorities, especially in health and culture. z The management and communication activity provides management capacity, communication, a protocol for adaptive management, formal and informal grievance mechanisms, and a monitoring and evaluation system. The RP, the CLIP, and the EMDP form a single program because a significant proportion of project-affected households are eligible for all three plans, and because implementation will be carried out in a largely integrated manner. Because almost all of the people residing in the project area are from ethnic minorities, the RLDP applies in its totality to eth- nic minorities and has been designed in every part to address their vulnerabilities. The program includes measures for adaptive management, governed by a protocol to ensure that it does not conflict with the principles set out in the RPF, Bank Policies, and the RLDP. Lessons from Preparation of the Trung Son Hydropower Project 15 and that can be undertaken during the reset- Dam Safety tlement process, when the communities have developed a more informed awareness of project An early review of Vietnamese dam safety require- impacts and opportunities. ments identified a few areas of divergence from the z The focus on stepping beyond compliance requirements of World Bank OP 4.37 on Safety of reflects an awareness that livelihoods restoration Dams, summarized below. is not, and cannot be reduced to, a compliance z Most significant, Vietnamese dam design prac- issue; compensation and other forms of liveli- tices, in particular, the extreme conditions that hoods assistance cannot guarantee successful res- dams should be designed to withstand, are based toration of livelihoods. The reaction of people on a “standards” approach. Dams are classified affected is not assured in advance, and it cannot primarily according to their type and height.This be known whether they will respond with the means they are only implicitly classified accord- degree of competence and enthusiasm that plans ing to their potential adverse social, economic, and procedural expectations predict. and environmental consequences in the event Innovation, capacity building, adaptive manage- of failure. Analysis of risks concentrates more on ment, and community-based livelihoods planning damage to the dam structure itself than on the will push development in a positive direction, yet it broader impacts on society. Trung Son is a “Class is also necessary to acknowledge that they all reflect II” dam under the Vietnamese classification relatively high levels of uncertainty, involve relatively because it is less than 100 m high. Therefore, it untested methods, and pose risks of their own. They is required to withstand a design flood frequency will mean very little if implementation goes awry, of 0.5 percent—that is, the worst flood expected and for that reason the willingness to adapt the man- to occur in 200 years, which in Trung Son’s case agement of resettlement and livelihoods restoration is estimated at 10,400 m3 per second—and a will remain critical to a successful outcome. check flood frequency of 0.1 percent (13,400 m3 per second) without being overtopped. The Vietnamese standards do not require that any consideration be given to a worse flood, or to the consequences of overtopping or dam failure should such a flood occur. z Another difference was that Vietnamese rules do not require dam safety reviews, whereas World Bank safeguard policies require reviews by inde- pendent panels of experts throughout the project cycle from design, construction, and filling of the reservoir, to the start of operation. z Although there are stipulations regarding opera- tion and maintenance (O&M) and emergency preparedness,Vietnamese regulations do not spe- cifically require that a detailed O&M plan and an emergency preparedness plan be prepared at the design stage and before reservoir impounding. 16 New Approaches for Medium-Scale Hydropower Development in Vietnam z Moreover, where possible failure of an upstream As a result of the efforts described above, TSHPP existing dam or a dam under construction could meets the requirements of international practice cause extensive damage to the new downstream with respect to dam safety. The dam safety analysis structure, no assessment of dam safety or recom- and the subsequent improvements in project design, mendations for improvements to the upstream through leveraging local technical knowledge with dam are required. international expertise, can serve as a useful example that can be replicated in other hydropower projects Having noted the differences, the World Bank in Vietnam. and EVN worked together to study the concerns in detail and address them to ensure compliance with Communications, Consultation, international good practice. Details and outcomes and Community Relations from this effort are discussed below. Communications, consultation, and community rela- z EVN and TSHPMB analyzed the dam’s perfor- tions were central to the preparation of the project. mance under extreme flood conditions, which The principle of free, prior, and informed consulta- was assumed to be the 72-hour probable maxi- tion in ethnic minority villages was pursued, and the mum flood (PMF) at the dam site, estimated to outcomes of the consultations were incorporated be 31,100 m3 per second. A review by an inter- into the project design. The work carried out dur- national hydrology expert confirmed the esti- ing preparation will be continued through ongoing mate and found that the dam as initially designed disclosure, communications, and additional channels would have been overtopped by up to 5 m and for addressing grievances during implementation. for up to 50 hours, which could, in turn, have been expected to lead to dam failure. Therefore, Consultations TSHPMB reviewed several design options that could withstand PMF, and selected a fuse gate dam The objectives of the consultations were to inform and emergency spillway as the most cost-effective the affected households, communities, local authori- solution. With these revisions to its design, the ties, and civil society organizations about potential project was brought in line with international project impacts and proposed mitigation measures; standards for dam safety. collect opinions and feedback to enable the prepara- z TSHPMB established a Dam Safety Review tion of resettlement plans and frameworks; and, in Panel (DSRP), which conducted site visits at the later stages, to complete the RLDP and EIA- both the feasibility and detailed design stages of EMP; and obtain broad support for the project. the project. The panel reviewed and accepted the The approach followed during the consultations proposed revision to the dam’s design to allow differed from previous consultations in Vietnam. safe passage of the PMF. The panel also reviewed EVN and the World Bank adopted an approach that the construction plans, dam safety program, focused on listening to affected people, asking them hydrology, geology, quality assurance, O&M, to share their concerns, and eventually designing instrumentation, and emergency preparedness a better project that addresses these concerns and plans prepared by TSHPMB and found them responds to their needs. Consultation was based satisfactory. All recommendations made by the on an acknowledgment that people affected by the panel with regard to potential issues were met, project would have useful ideas about what would and the DSRP issued a letter providing its clear- be likely to work and what would not work during ance of the plans. project implementation. z In addition, an emergency plan was prepared to protect downstream villages, among other things. Lessons from Preparation of the Trung Son Hydropower Project 17 Consultations were held continuously with the Many of the consultations were held in the eve- people who will be affected by the reservoir and the ning because most of the people work during the access road, as well as with various levels of local day, and it was difficult for them to leave daily work government (districts, provinces), civil society, and to join the meeting. Minority or underrepresented other stakeholders. groups, including women and young people, were encouraged to participate in all meetings. Carrying out consultations with the affected peo- ple presented multiple challenges, including that the Vietnamese national NGOs participated in the project areas were quite remote with limited access; local consultations as independent observers at vil- the houses were sparsely distributed; and the four lage, district, and provincial consultation meetings. ethnic minority groups, Thai, Muong, H’mong, and The consultations and TSHPMB’s responses were Kho Mu, had limited education. Members of the posted on the project website. After completion of Thai and Kho Mu speak Thai and Vietnamese. The the consultations, the documents were updated and Muong speak Muong and Vietnamese. The H’mong re-disclosed. consultations were particularly critical because this Well in advance of the consultations, written, group has high levels of illiteracy, and many, partic- visual, and audio materials in form, substance, and ularly the women, do not speak Vietnamese. After language appropriate for the audiences were pro- extensive preparation, three major rounds of con- vided. Figure 2 illustrates examples of the visual sultations were carried out between 2008 and 2010, material prepared for these consultations. with several weeks-long visits to the site by the proj- ect team in each round. Multilingual consultations The nature and extent of the consultations with were conducted in 53 villages in four districts of affected people and local governments evolved over three provinces. The consultations were held at the time. Initial consultations were designed to provide hamlet or village level, and led by respected mem- information to affected communities and to gather bers of the community. factual information from them. Information from Figure 2. Examples of materials used in consultations 18 New Approaches for Medium-Scale Hydropower Development in Vietnam those affected by the project tended to be gathered Photographs and video recordings were taken, in quantitative form. The latter stages of consulta- but only if they did not inhibit the consultation tion, particularly the second and third rounds in late process. Minutes were prepared for each consul- 2008 through early 2009 and in late 2009 through tation and agreed to with participants. A sum- early 2010, aimed at presenting the plans based on mary report describing the consultation process the earlier consultation with the intention of build- and main findings was prepared no later than ing consensus, as well as responding to concerns pre- one week after each consultation. At least one viously voiced by those affected by the project. The observer from a Vietnamese NGO was present at third round of consultations, during which the draft each of the village consultations. final versions of the EMP and RLDP were discussed, z After each consultation, all questions were col- are worthy of attention. lated and summarized, and responses provided. If appropriate, changes were introduced into the z At least three weeks before each consultation EMP and the RLDP. The questions, responses, meeting, information of appropriate form and and revised versions of the EMP and the RLDP in local languages was provided at district, com- were provided to all affected villages. mune, village, and household levels. The infor- mation varied depending on the level at which Consultations with civil society. In addi- it was supplied. Full versions of the EMP and tion to the participation of Vietnamese NGOs in the RLDP were made available at the district consultations with project-affected communities, and commune level. A summarized and simpli- a separate round of public consultations was car- fied version of about 20 pages was provided to ried out in Hanoi in March 2010 to enable broader the Commune People’s Committee and village engagement. The event was open to the public and head. Information sheets, posters, and calendars was advertised in newspapers to promote partici- with project information, frequently asked ques- pation. The event was attended by more than 100 tions, and contact details were given to village members of civil society organizations, think tanks, heads and distributed to all households. Audio and academic institutes in Hanoi. A panel discussion recordings of project information, frequently took place, following presentations on the RLDP, asked questions, and contact information, along and the EIA-EMP. The World Bank invited the with a machine on which they could be played, NGOs that had participated in the consultations to were provided at village level. Recordings were make a presentation, which they were not asked to in four languages: Vietnamese, Thai, Muong, and provide to the World Bank beforehand. H’mong. z At each consultation, efforts were made to ensure participation by as many villagers as possible and any other interested individuals or organizations, especially women and others who might other- wise be excluded from attending; and consider- ation was given to having separate meetings with any group that was reluctant to attend the village meetings. A short oral summary of the project, its impacts, and proposed mitigation measures was presented in each meeting. All questions, feed- back, and requests were recorded and responded to appropriately. Group discussions were held if needed. In addition to Vietnamese, discus- sions were held in local languages as necessary. Lessons from Preparation of the Trung Son Hydropower Project 19 z More flexible allowances for ethnic differences. Ceremonies for moving houses and reburial of the remains of ancestors vary between the eth- nic minorities, but support was initially designed somewhat inflexibly. Following consultations, a more flexible means of support was adopted that will allow the different ceremonies to be sup- ported by TSHPMB. More detail about the consultation, communica- tions, and community relations aspects of the project are available on the project website. Ongoing disclosure TSHPMB and the World Bank devised and imple- mented a coordinated communications strategy. To Outcome of consultations. The consul- ensure effective communication with a large and tations not only created goodwill and built trust diverse group of stakeholders, a comprehensive plan, among stakeholders, but also played a central role aimed at maintaining understanding and ownership in the completion of core documents. The con- of the project, is now in place. The plan is based on sultations were pivotal in finalizing the SESIA and the primacy of EVN in communications, ensuring the EMP; creating the RLDP and its communica- that information is accessible to all stakeholders in tion and management component as one integrated formats appropriate for the audiences, and that com- whole; and initiating an open dialogue between munication is candid and proactive. At the center of TSHPMB authorities, village leaders, affected this approach were web pages dedicated to Trung households, local governments, and NGOs. Some Son, one set up on the World Bank Vietnam website significant outcomes of consultation with commu- and the other one on the TSHPMB website.9 nities during preparation follow: Throughout preparation, the World Bank and z The revision, in two communes, of the initially TSHPMB disclosed through multiple channels planned resettlement sites. Local people identi- all major documents concerning project prepa- fied sites they preferred, which were smaller—and ration. Key project documents were made avail- thus involved dividing the community—but had able to the public at the Vietnam Development more fertile soils and better water resources. The Information Center in Hanoi; at the World Bank sites were also closer to their holdings of luong Public Information Center (Infoshop) located in bamboo, an essential part of their livelihoods. Washington, DC; the World Bank Vietnam website z A revised approach to compensation for loss of and the project website in Vietnamese and English; luong bamboo holdings. Initially, the level of in addition to being disclosed at the project area compensation was determined using a method (district, commune, and village levels) in Vietnamese. based on the number of culms (stems) but this More than 50 documents were disclosed, covering a method did not take account of the ability of wide range of issues including technical, economic, the plant to generate more culms in later years. and financial aspects of the project; key environmen- In response to several comments and experience tal and social studies; and consultation reports. The with compensation for the access road, a revised method was worked out based on the lifetime 9. These websites are www.trungsonhp.vn and www.worldbank.org/ value of the bamboo plant. vn/trungson. 20 New Approaches for Medium-Scale Hydropower Development in Vietnam complete list of documents disclosed is available in management mechanism, is intended to ensure that the Project Appraisal Document.10 not only does the project ex ante meet Bank poli- cies, but can continue to do so by adapting its sup- Disclosure of project information will be contin- port to affected people throughout its lifetime. ued through implementation. The formalVietnamese mediation system involves The Community Relations Program people’s committees from commune up to province level. The grievance process, based on the national The community relations program aims to address procedure outlined in the Land Law, comprises four concerns and grievances from people and communi- stages, with the issue being elevated to the next level ties affected by the project, to maintain information if a certain stage does not deliver a satisfactory out- flow, and to be the point of contact for the resolu- come for the aggrieved person. The first stage is the tion of complaints and grievances. The program is communication of an oral or written grievance to integral to the work of the Social and Environment commune authorities. The commune-level media- Department of TSHPCo and is budgeted and staffed tion is followed by the District People’s Committee, by it. Contractors, especially the main civil works the Provincial People’s Committee, and finally the contractor, will be required to support this program Court. Grievance resolution at each stage is required with staff and information. to take place within a The community relations function is for all set time. TSHPMB is people affected by the project, whether previously required to support the identified as such or whether incidentally or subse- formal grievance process quently affected. Its responsibilities are to by recording all grievance files, reporting them in z address in a timely way concerns and complaints the monthly monitoring from the people and communities affected by the process, and following up project; to ensure timely resolu- z ensure communities are promptly and adequately tion. TSHPMB must also informed in advance of impacts and actions pro- exempt persons regis- grammed as part of project implementation; tered as residents in proj- z offer a vehicle for mutual interaction between ect-affected communities TSHPMB and those affected by the project to from administrative or receive inputs from individuals and the local legal fees associated with communities; and pursuit of grievances. z act as the forum for discussion and consultation The grievance mech- about unanticipated project impacts that arise anism run by TSHPCo is during implementation. independent of the sys- tem established under Vietnamese law. The indepen- An additional channel for addressing dent grievance mechanism is extended to anyone grievances affected by the project, not only those that are to be The project also in puts in place an independent resettled.TSHPCo is required to monitor complaints grievance mechanism to complement the formal continuously to improve quality of the resettlement Vietnamese grievance procedures. The independent process and to ensure project compliance with the grievance mechanism, combined with the adaptive EMDP for ethnic minority issues. The safeguards team in TSHPCo is required to provide a monthly 10. Project Appraisal Document, Annex 14 (World Bank Report No. 57910-VN). Lessons from Preparation of the Trung Son Hydropower Project 21 monitoring report to the Independent Grievance can be relayed orally or in written form. They may Panel (IGP) on all complaints and grievances. also be reported through the Commune People’s Committee, which informs the TSHPCo safe- Under this mechanism, complaints or grievances guards staff; or directly to the safeguards team during can be relayed to TSHPCo by a variety of sources, monthly compliance monitoring. The company is including directly from either an individual or a required to set up a dedicated hotline for complaints group, or through a representative such as the village and grievances. head, a representative of a mass organization, or an NGO. Complaints and grievances can be communi- The way in which the independent grievance cated in Vietnamese or any local language, and they mechanism works is summarized in box 3. Box 3. Principles and Procedures of the Independent Grievance Mechanism Key principles in the independent process are (a) to deal with the matter at the lowest possible level and (b) to address complaints as quickly as practicable to prevent minor issues from becoming major. A complainant’s first point of contact with TSHPCo will be the project Community Relations Officer, a member of TSHPCo’s Social and Environment Department. The officer will take up the matter with relevant members of the department to try to reach a solution. If no solution satisfactory to the complainant can be achieved, the complainant meets the Manager of the Social and Environment Department, who addresses the issue in conjunction with heads of other departments in TSHPCo, contractors, and local authorities as necessary. Records of meetings between complainants will be maintained and reviewed by the project’s Independent Monitoring Consultants. Meetings are conducted in a language acceptable to the complainant and in a setting appropriate to the needs of the meeting (which may include the site of the complaint, or the offices of TSHPCo). If the complainant is not satisfied with the solutions on offer from the head of the Trung Son Safeguards Team, the IGP will hear the case. The IGP is composed of the head of the Trung Son Safeguards Team, and at least one member of the independent Environment and Social Panel of Experts. It is chaired by the Director of TSHPCo. It may add other members as required including, for example, independent social and environmental monitoring consultants, a technical expert, or an NGO. It may also take independent advice from consultants or other experts, at its discretion. Complaints received by the IGP will be publicly disclosed when they are received. The IGP will hear the complaint in a face-to-face meeting, at which the complainant and any adviser or representative may be present. The IGP will publish its findings promptly after it has completed its deliberations, and one member of the IGP will be delegated to communicate the findings to the complainant in a suitable form and language. The IGP convenes quarterly to review all complaints dealt with by either the Community Relations Officer or the Manager of the Social and Environment Department, and to discuss any ongoing complaints. The IGP can be convened by any member to deal with urgent matters that cannot wait until the next scheduled meeting. Project information leaflets provide practical information about grievances to local residents, such as contacts and addresses. They mention both the formal Vietnamese mechanism and the IGP, and provide information about how to access both channels. 22 New Approaches for Medium-Scale Hydropower Development in Vietnam Economic Analysis storage (in combination with either nuclear or coal). As with any project, one key purpose of the eco- z Given that hydropower is indeed the best option nomic analysis for Trung Son was to identify alterna- for peaking power, how does Trung Son com- tives to ensure the project meets the development pare with other hydropower options? Are there needs of the country as efficiently as possible. The more attractive hydropower projects that should economic analysis started with project screening, dis- be built in its place (or built before Trung Son)? cussed above.The analysis for Trung Son also focused Would imports from Lao PDR, Cambodia, or on risks and in some respects helped inform project China be more attractive (lower costs or lower design to address them. It also assessed greenhouse environmental impacts)? gas (GHG) emissions to be avoided by the project. z Given that a hydropower project in the Trung Son section of the Ma River is the best option, Analysis of alternatives what specific site alternatives are available, and The consideration of alternatives took place during what are the general alternatives for project con- the project screening stage. It was incorporated into figuration (particularly with respect to high water the formal economic analysis through a paper on elevations and environmental and social impacts alternatives, which sought to quantify the options of the project alternatives)? of avoiding additional generation altogether; build- The analysis of alternatives concluded that ing generating capacity using other, mainly thermal, technologies; building other hydropower plants in z Vietnam’s strategy of developing its indigenous Vietnam; and choosing different sites for the Trung conventional hydropower resources, and its Son plant. The alternatives analysis asked four domestic natural gas and coal resources, before questions: turning to other imported fuels is robust to a wide range of uncertainties in input assumptions, z Could the need for additional peaking power including assumptions about load forecasts and be met by more aggressive energy conservation, international energy prices. demand-side management, and transmission and z Alternatives to this strategy would be extremely distribution loss reduction? In other words, is costly, with significant increases in GHG there a need to expand supply at all? emissions. z Given that Vietnam does indeed need to add z Vietnam’s power development plan already capacity, what is the optimum supply-side expan- envisages a substantial program of small hydro- sion strategy, and does it include hydropower? power and renewable energy development, as That is, is there a cost-effective alternative to the well as efforts to promote supply- and demand- strategy of developing hydropower as the best side energy efficiency. Not building any addi- source of peaking power?11 The reasonable alter- tional peaking power generation projects is not natives are natural gas in some combination of a reasonable alternative, given Vietnam’s likely open and combined cycle generators, possibly economic development and progress in poverty using imported liquefied natural gas; and pumped alleviation. z Among the hydropower projects remaining to be developed, Trung Son has favorable econom- 11. Environmental considerations may limit operation as a pure peaking ics and relatively modest environmental impacts, project because generation ramp-up times are constrained by the nature which are expected to be fully mitigated or man- of hydropower (and should not exceed increases in stream flow rates experienced under natural conditions), and because of the minimum aged to international standards. downstream flow requirement. However, detailed studies (reported in z The Trung Son investment decision is robust the Economic Analysis Background report) show that the contribution of the capacity credit to the total economic benefit is modest, and that with respect to load forecast uncertainty and ramp-up constraints have a correspondingly small impact on the eco- international oil price uncertainty. nomic returns. Lessons from Preparation of the Trung Son Hydropower Project 23 Risk analysis Figure 3. Probability distribution of ERR The risk assessment derived a probability distri- mean: 13.9% bution of economic returns using a Monte Carlo 0.25 median: 14.8% probability (ERR <10%): 6.5% simulation in which the input variables were speci- fied as probability distributions. The input variables 0.20 selected were those most likely to affect economic probability viability and took into account the following risks: 0.15 z World oil prices, which in turn impact coal, gas, and fuel oil prices, and hence the level of benefits. 0.10 z Capital cost, specified as a multiplier of the base- line estimate. This is a highly skewed distribution because cost overruns are far more likely than 0.05 cost underruns. Consideration was also given to delays in the time for completion of the project, 0 2 6 10 14 18 22 26 which is correlated with cost overruns. ERR, real (percent) z Average annual generation, as a general proxy for hydrology risk. z Climate change scenarios, to reflect long-term the thermal alternatives. Net emissions should be changes driven by climate change or any system- established on a case-by-case basis. atic errors in the inflow series definition. Given Vietnam’s GHG emissions have risen sharply, and the uncertainties, climate change was specified as a World Bank comparative study showed Vietnam to a discrete probability distribution for five climate have the second-highest GHG emission growth rate change scenarios based on forecasts for Vietnam among countries in the decade 1994–2004, albeit prepared by the Ministry of Natural Resources from a very low base. In consequence, the project and Environment. economic analysis also included a section on carbon z O&M cost variations, specified as a uniform dis- accounting. tribution of assumptions on the annual O&M cost as a percentage of capital cost. During the wet season, when TSHPP will run z Value of the carbon externality. In the base- virtually 24 hours per day, it was assumed that the line this value was assumed to be $30 per ton, plant will displace coal generation in the north of the unchanged in real terms into the future. country, meaning that the most inefficient coal unit should be taken off line for this period. There are The result of the simulation is shown in figure significant variations in heat rate (and hence variable 3, which shows the most likely value of the eco- cost) among the older coal units, with resultant effi- nomic rate of return (ERR) to be 18.3 percent. It ciencies in the range of 20.7 percent to 36.6 percent. also shows that there is a 1.9 percent probability of During the summer months, when TSHPP would not meeting the hurdle rate for capital in Vietnam of run as a peaking plant, the least efficient gas-fired 10 percent. Thus, the analysis demonstrates that the power plant would be taken off line. These plants project is robust to the identified risks. also have a range of efficiencies, from 40.8 percent to 50.7 percent.To the extent that TSHPP allows use Assessment of greenhouse gas impacts of the thermal plant to be avoided, it contributes to The World Commission on Dams indicates that reduced GHG emissions. GHG emissions avoided hydropower cannot, a priori, be automatically by the power generated by Trung Son during the assumed to emit less greenhouse gas (GHG) than 123 days of the wet season were estimated to be 24 New Approaches for Medium-Scale Hydropower Development in Vietnam 6,000 tons of CO2 per day, and during the 242 days The calculation demonstrated that in comparison of the dry season were estimated to be 800 tons of with the avoided CO2 emissions from the reduc- CO2 per day. These are conservative estimates based tion in thermal generation, reservoir emissions were on the assumption that the avoided thermal genera- trivial, and suggest that the net CO2 avoided by the tor is a gas-fired plant in the summer. project is more than 900,000 tons per year. GHG emissions from the reservoirs for storage Identifying and Managing Critical hydropower projects remain a controversial topic. Implementation Risks The so-called power density, measured in Watts of nominal installed capacity (W) per square meter A key aspect of preparation was to identify the criti- (m2) of reservoir area has come into increasing use cal risks to successful project implementation and as a proxy for the GHG efficiency of a hydropower the mechanisms needed to overcome them. This project. section reviews some of the approaches adopted in the Trung Son project that may be useful in other With a flooded area at full reservoir level of 13.1 projects. km2, and a power output of 260 MW, the power density of Trung Son is 19.8 W/m2.Trung Son com- Managing focus on outcomes pares favorably with the range of power densities for Brazilian projects, which are the basis for the thresh- A problem often faced in projects in Vietnam is olds proposed by the United Nations Framework their propensity for delay during the start-up phase. Convention on Climate Change in determin- This is particularly a risk in the Trung Son proj- ing eligibility of hydropower projects for Clean ect; although TSHPCo bears overall responsibility Development Mechanism financing. This compari- for implementation, some corporate EVN entities son is presented in Table 3. retain management oversight and accountability, including for procurement, financial management, Based on these data and the median methane and governance, and environment. Although events CO2 fluxes obtained from the Brazilian surveys, it could normally be expected to run smoothly, with was estimated that 56 tons of CO2 equivalent would good collaboration between the corporate EVN be emitted from the Trung Son reservoir per day. functions and TSHPCo, exceptions and unusual Table 3. Comparison of power densities for Brazilian hydropower projects and Trung Son Installed capacity Reservoir area Power density Project Country and province (MW) (km2) (W/m2) Xingo Brazil—Caatinge 3,000 60.00 50.00 Trung Son Vietnam—Thanh Hoa 260 13.13 19.80 Segredo Brazil—Mata Atlantica 1,260 82.00 15.47 Itaipu Brazil—Mata Atlantica 12,000 1,549.00 8.13 Miranda Brazil—Cerrado 390 50.60 7.72 Tucuri Brazil—Amazonica 4,240 2,430.00 1.74 Serra da Mesa Brazil—Cerrado 1,275 1,784.00 0.71 Barra Bonita Brazil—Mata Atlantica 141 312.00 0.45 Samuel Brazil—Amazonica 216 559.00 0.39 Tres Marias Brazil—Cerrado 396 1040.00 0.38 Source: Marco Aurélio dos Santos et al., Variability of Greenhouse Gas Fluxes from Hydropower Reservoirs in Brazil, UNESCO Workshop on Freshwater Reservoirs and GHG Emissions, Paris, November 2006. Lessons from Preparation of the Trung Son Hydropower Project 25 situations—inevitable in a large project—tend to maintained at preproject levels, at a minimum. A cause delay because they are subject to multiple lay- second measure will assess compliance with the ers of oversight and approval. EMP. Several intermediate results indicators address other safeguard elements, which are included in the To improve coordination during project imple- environmental and social component. These indica- mentation, when there will be a greater degree of tors focus on resettlement compensation, livelihoods autonomy for TSHPCo, EVN created a task force development, health risk awareness, implementation comprising staff from key corporate departments of the public health action plan, the environmental and the Director of TSHPCo. This task force is management plan, and corrective actions and adap- mandated and empowered to make all relevant deci- tive management implementation if existing mitiga- sions and will oversee activities and ensure coordina- tion measures are not adequate. tion between TSHPCo and the corporate functions of EVN as long as it remains owner of the proj- Governance and accountability ect.12 The task force is accountable to an EVN Vice President who is the World Bank’s main counterpart During preparation for Trung Son, an anonymous for all EVN’s operations. complaint alleged collusion in the selection of the contractors for building the access road and bridges. Incorporation of social and In consequence, EVN’s senior management asked environmental mitigation into project the task team to undertake an assessment of EVN’s scope and results indicators governance and accountability systems, including those for the project. The assessment and its find- A common problem in hydropower projects is that ings and recommendations were received positively, progress in environmental and social aspects lags with enthusiasm and strong ownership on the part behind progress on the technical and construc- of EVN and TSHPCO leadership. Recognizing the tion side. For Trung Son at least, this is not for challenges in the sector, senior EVN management want of commitment: the government of Vietnam and TSHPMB indicated their intention to improve has demonstrated its commitment to ensuring the governance and accountability while also taking implementation of the social and environmental into account that TSHPMB was a young organiza- mitigation measures by borrowing IBRD funds for tion that needed additional support at the corporate that purpose.13 The project objectives include social level. and environmental goals, which are reflected in the outcome measures and intermediate results in the Eventually, a combination of two main approaches monitoring and evaluation framework—the project was adopted.The first approach focused on strength- must meet those goals to be considered a success. ening TSHPCo. Targeted capacity building for indi- The project design includes a separate component viduals involved in project management focusied on that focuses on social and environmental impact improving understanding of processes and imple- management, and includes, among other items, mentation arrangements for ensuring transparency, the mitigation of the environmental consequences integrity, and accountability. Moreover, a Governance of construction and operation of the dam and the and Accountability Framework was developed for implementation of the EMP and the RLDP. TSHPCo, together with a time-bound action plan and agreement on equipping the staff to implement One outcome measure will assess whether the the framework. The framework identifies the fol- livelihoods of those affected by the project are lowing risk reduction actions: enhancing integrity by raising awareness; strengthening accountability; 12. Under power sector reform, EVN may eventually be required to give up ownership of TSHPCo. strengthening project controls; enhancing transpar- 13. The World Bank will not finance land acquisition or compensation ency in project procurement and implementation; payments. 26 New Approaches for Medium-Scale Hydropower Development in Vietnam improving capture of complaints; and broadening The panel of experts, which provided advice stakeholder involvement. The implementation of and input in the definition, execution, and review the framework in its entirety was made binding for of background studies on social and environmen- TSHPCo through covenants in the project’s legal tal aspects of the project during project preparation, agreements. In keeping with the general princi- will continue to have a role during implementation. ples for adaptive management, adjustments may be The panel’s composition and terms of reference will made after experience is gained and through discov- be adjusted to reflect project implementation needs, ery of what works and what does not. The second focusing more on monitoring of the plans prepared approach involves strengthening the inspection14 during implementation. At least one member of the process in EVN.This is a longer-term effort, and the panel will participate in the IGP, thus helping to lessons learned in TSHPCo will be used as the basis maintain impartiality in the independent grievance for a broader effort to improve inspection and other mechanism. activities that can then be transferred to EVN as a These entities are intended to complement the whole. primary oversight provided by EVN and TSHPCo and local government authorities, and regular super- Advisory bodies vision by staff of the World Bank involving real-time Two advisory bodies were set up to facilitate project support from Hanoi, as well as periodic site visits and preparation: the Panel of Environmental and Social management and technical missions. Experts and the Dam Safety Review Panel (DSRP). Both are required by Bank policy, and have con- Adaptive management tinuing roles during implementation; therefore, it is A key focus of the preparation for Trung Son was legitimate to look beyond compliance and at their to ensure that the right institutional arrangements, value added from the client’s perspective. Both bod- resources, and incentives are in place to manage the ies bring international expertise to the project and challenges and risks of implementation. To some are able to see risks from a different perspective.They extent, this prevents the need for overly prescrip- also can help manage risks through their objectivity tive and detailed plans, but changing circumstances and independence and by being on hand to advise often need to be reflected in revised plans.The catch on concerns that may arise during implementation. Such concerns can often start off as minor issues but unless addressed early on may grow to the point that they become major points of contention, diverting management attention, attracting adverse publicity, and causing delay, and in some cases, abandonment of the project. During implementation the two advisory bodies will evolve: The functions of the DSRP, which provided safety advice during preparation, will be absorbed by a Project Technical Advisory Panel that will be tasked with providing general project technical and engineering advice during the construction phase— in addition to meeting the requirements of the Bank’s policy on dam safety. 14. “Inspection” is the Vietnamese term for internal control, not unlike a combination of the World Bank’s Internal Audit and Integrity functions. Lessons from Preparation of the Trung Son Hydropower Project 27 is that many of the plans are driven by World Bank Adaptation will only take place if it leads to better policy and are legally binding undertakings. Adaptive achievement of the project’s objectives and princi- management is intended to provide a framework to ples. Adaptive management cannot be used to justify adjust undertakings when they are no longer suit- actions that would conflict with legal principles or able while at the same time preventing those that World Bank policies.The Project Operations Manual should still apply from being ignored under the establishes decision-making guidelines for adaptive guise of adaptation. management, distinguishing between actions that may be taken by TSHPCo or local implementing Adaptive management can be used in response to agencies on their own initiative and actions that changes in the legal framework, actual circumstances would require prior approval by the World Bank. on the ground, budget and costs, and schedule. For Prohibited changes would include, among others, example, if monitoring of environmental or social conditions indicates that circumstances in the proj- z altering or reducing environmental standards ect area have changed, or there was an oversight dur- such that the project area is not restored to its ing preparation (such as a household not included preproject condition to the greatest extent pos- in the initial analysis proving to be eligible for com- sible, or failing to mitigate known environmental pensation), the principles set out in the SESIA, the impacts; EMP, and the RLDP will apply. Adaptive manage- z ignoring or avoiding dealing with emerging ment is most likely to be used when dealing with environmental or social issues; fish and fisheries in the reservoir and downstream, z restriction or elimination of entitlements and with water releases and environmental flows, with eligibility criteria, or reduction of compensation increased erosion downstream, with water quality in rates; the reservoir and downstream, with health impacts, z lowering the resettlement objective below the and with resettlement and livelihoods develop- requirement to at least restore incomes or living ment. To allow for adaptive management, contin- standards to preproject levels (or accepting a sub- gencies were included in the budget of the Social standard outcome as satisfactory); and and Environment Impact Mitigation Component. z imposing activities on ethnic minority commu- Accordingly, costs of environmental and social miti- nities without free, prior, and informed consulta- gation activities may be adjusted when needed dur- tion resulting in expression of broad community ing implementation. support. 28 New Approaches for Medium-Scale Hydropower Development in Vietnam Part C Conclusions from the Preparation Experience Why Does the Trung Son Hydropower development. The lessons from preparation for this Project Experience Matter? operation could apply to similar operations, espe- cially in how the Bank worked in partnership with The Trung Son Hydropower Project is a good the government on challenging issues. In particu- example of a well-designed, relatively low-impact, lar, the Bank was able to help strengthen country medium-scale hydropower project, prepared accord- systems, develop local capacity for sustained results ing to international good practice. Given Vietnam’s during implementation, conduct extensive consulta- plans to develop a series of medium-scale hydro- tions, and address governance issues. power projects in the coming years, the first hydro- power project that the World Bank is financing in Trung Son was also the first significant hydro- Vietnam can serve as a good practice example upon power project with storage that the World Bank which subsequent projects can build. Board of Executive Directors approved subsequent to its approval in 2005 of the 1,070 MW Nam Theun 2 Extracting lessons from the project preparation experience matters because Trung Son was pre- pared according to good international practices with respect to environmental, social, and dam safety considerations. Social and environmen- tal sustainability have been at the center of the project preparation effort throughout. In fact, the project preparation process has been instrumen- tal in introducing new approaches for sustainabil- ity of medium-scale hydropower development in Vietnam. If replicated, the Trung Son example can contribute to the sustainable scale-up of medium- scale hydropower development not only in Vietnam but also in other countries interested in sustain- able hydropower development. The project’s focus on learning by doing is expected to contribute to broader adoption of international good practices in Vietnam as the country scales up hydropower Lessons from Preparation of the Trung Son Hydropower Project 29 Trung Son. One similarity between the two projects is that the people they affect are almost entirely from ethnic minorities. NT2, which attracted worldwide attention, is con- sidered “best practice” in the way potential impacts were anticipated and preparatory work undertaken to address those impacts. Extensive study, analysis, consultations, and state-of-the-art communication efforts were carried out throughout the preparation of NT2, and for the programs to address the proj- ect’s potential social and environmental impacts. As a result, the project involved extremely articulated, well-prepared, and comprehensive impact mitiga- tion and management programs and plans, to ensure each and every potential impact was anticipated. Project preparation efforts for Trung Son were undoubtedly influenced by the example set by NT2. (NT2) hydropower project,15 which is a high-profile Trung Son, however, is taking a somewhat different multipurpose project in Lao PDR.16 Trung Son and approach from NT2 for meeting the requirements NT2 are different in many respects, including scale, of World Bank safeguard policies and ensuring con- nature, impacts, and mitigation measures. NT2 is in tinued compliance with international good practice. an area of high biodiversity and cultural heritage, Instead of putting in place a costed mitigation plan and the project created a 450 km2 reservoir affect- for every single risk identified, the project has pre- ing about 16,000 households, or 80,000 people. pared extensive social and environmental impact Accordingly, NT2 has a far more significant foot- mitigation plans that anticipate the impacts foreseen print than Trung Son. NT2’s downstream impacts at the time of preparation, and uses innovative social are much larger compared with Trung Son, given instruments and built-in mechanisms, such as con- that NT2 is transferring water from one river basin sultations, a community relations program, grievance to another, whereas Trung Son is removing water mechanisms and adaptive management, to make sure and releasing it into the same river a few hundred unforeseen issues can be addressed. The flexibility in meters below the dam. Moreover, ownership is dif- the various mechanisms arises from the acknowl- ferent: Trung Son is driven by EVN and Vietnam’s edgment that the project may lead to unanticipated domestic electricity needs with one main external impacts over time, and the associated mitigation financier (IBRD); in contrast, NT2 is an indepen- measures may have to be fine-tuned, revised lightly, dent power project for export with 27 international or overhauled, based on the reality encountered on financiers. Last, the gap between Lao PDR’s capacity, the ground, and in line with the principles agreed on institutional maturity, and income and the demands at the outset. It is important to note that Trung Son of a world-class complex infrastructure project is in no way represents a retreat from the Bank’s stan- somewhat greater than that between Vietnam and dards and policies; to the contrary, it provides a more effective and flexible means for ensuring compliance with these standards and policies, and making sure 15. The other hydropower project approved by the World Bank Board of Executive Directors (in 2007) was the Bujagali Hydropower Project the project continues to comply with these standards in Uganda, which is a run-of-river scheme. Similar to NT2, Bujagali and policies. project preparation took about seven years from concept to approval. 16. Extensive information on NT2 is available on the dedicated project Preparing a “best practice” project such as NT2 website http://www.namtheun2.com/ and at http://www.worldbank. org/laont2http://laont2. was neither cheap nor easy. NT2 preparation time 30 New Approaches for Medium-Scale Hydropower Development in Vietnam and transaction costs were significant—project prep- World Bank standards, the focus was on comple- aration took nearly seven and a half years from con- mentingVietnamese requirements with international cept stage to Board approval, and cost about US$7.5 good practice.The preparation of key environmental million in World Bank resources, excluding any trust and social documents was undertaken primarily by funds provided by bilateral donors. The preparation Vietnamese institutions, with senior-level, targeted, time for Trung Son, however, was nearly four and a individual expert assistance from international con- half years from concept stage to Board approval— sultants to provide advice and guidance.Throughout well above the Bank average, but significantly shorter the project preparation effort significant transfer than NT2. Trung Son project preparation costs were of knowledge between international and national much lower than for NT2, although also well above experts, as well as World Bank staff, occurred. The the Bank average, with about US$1 million in Bank following insights suggest how conscious efforts to resources spent on preparation, excluding trust funds. collaborate contributed to the effectiveness of this project preparation: The way Trung Son Hydropower Project was prepared can be seen as a workable, replicable, and z Going into the project with more in mind than practical approach, incorporating innovative social compliance; otherwise parties may miss develop- instruments and built-in mechanisms. In that sense, ment opportunities, and worse, induce others to Trung Son might be considered a “next step” proj- try to cut corners. ect when compared with NT2, with regard to its z Seizing project preparation as an opportunity to focus on adopting international good practice for build capacity, and beginning to work with key sustainable hydropower development while costing counterparts on technical issues and safeguards the client country and the Bank less, and taking less from the start. time to prepare, thanks to the innovative approaches z Being flexible and willing to revisit parts of the adopted during preparation and project design. project design to incorporate new information Some improvements could still be made, but it is on that emerged along the way. Accepting that unan- the right track. ticipated issues may emerge during implementa- tion, planning for contingencies, and setting aside What Approaches Worked Well in resources to deal with them. Preparing Trung Son? z Establishing and emphasizing the primacy of the client in all aspects of project preparation, com- This discussion presents the approaches that appear munications, and community relations functions. to have worked well during preparation. It draws z Viewing safeguard policies as a development on candid conversations with international experts opportunity, not simply a matter of compliance, to and key team members. An overarching insight is the benefit of teams, clients, and key stakeholders. that a little bit of humility goes a long way. If parties are willing to accept that they may not have all the How the preparation teams worked together answers, then they are bound to consult, disclose, lis- ten to other viewpoints, and adapt the project design The set-up of the EVN-TSHPMB and World Bank to better meet its goals. teams, the way they were complemented by high- quality Vietnamese and foreign consultants, and the Building on country systems, way they worked together had a major bearing on incorporating international practice, the success of the project preparation process and the and enhancing local capacity resulting project. Environmental, social, and dam safety programs, and The level of support provided by EVN to even the approach for consultation and for grievance TSHPMB, the strength of its senior management redress, build on Vietnamese requirements. Where team, and its openness to new ideas were essen- differences were identified between Vietnamese and tial to the collaborative process. A small, but strong, Lessons from Preparation of the Trung Son Hydropower Project 31 Quality and the trade-off between speed and depth Task teams should be prepared for reaction to hydro- power projects; concerns about and opposition to hydropower projects are bound to occur.Teams must prepare a good project that complies with interna- tional practice and World Bank policies, perform adequate consultations in advance, communicate their messages well, be prepared to respond to que- ries, and ensure mechanisms are in place to address issues that emerge during implementation. This is not necessarily gold plating: “just in case” work can be avoided or reduced with a bit of forethought, as in the following examples: z Undertaking thorough baseline analyses—tech- nical, economic, financial, social, and environ- multidisciplinary World Bank task team was a major mental—because they inform much more than asset for the project’s preparation. The Bank team the question of project viability. comprised high-caliber staff from across the insti- z Engaging key stakeholders early on, with clear tution but was firmly rooted in the country office, plans on how to work with them and follow with its deeply knowledgeable and experienced through. Consultation is hard work, but can be local staff facilitating progress in ways not possible extremely rewarding in preparing a good project in more internationally driven design processes. For and garnering support for it. Inadequate consulta- both EVN and the World Bank, clear leadership and tion up front, and a poorly prepared project, may continuity throughout preparation was critical, and lead to much more work during implementation. will remain so through the start of implementation. z Putting in place and implementing a communi- The two parties—TSHPMB and the World cations plan. It is advisable to be transparent and Bank—devised a work method in which subteams, share information early in the process. Unless for example, the social safeguards teams, worked there is an overriding reason not to disclose, together with a fair degree of autonomy, but with make information available to the public. each side responsible for keeping other parts of its z Using expert panels to provide essential depth team informed. This allowed the subteams to work for task team and client alike. Finding the right at their own pace and to stay in touch with over- people might take time, and panel composition all project development. A more monolithic work- may need to be changed based on project phase. ing style would not have worked as well, given the Having no panel is better than retaining an irrel- size and complexity of the project. The autonomous evant one. style also allowed flexibility for the World Bank team z If choosing adaptive management, being clear to fit the work into its members’ schedules, but it from the outset that it complements good prepa- required considerable coordination effort. ration and does not substitute for it; thus, setting the ground rules under which changes will be permitted requires care and attention. 32 New Approaches for Medium-Scale Hydropower Development in Vietnam What Could Have Been Done Differently? coordinating the activities of the subteams, and ensuring messages in communications were con- Conversations between the authors of this paper sistent with the published documents took con- and various individuals with extensive knowledge siderably more effort than expected, and had to of the project and hydropower development pro- be correct in every detail. vided insights on what to avoid, or do differently, z Key staff will inevitably move on from the team, when preparing future projects. Some points that but this mobility has to be weighed against the emerged, which could be useful for other practitio- need for continuity and the skills required dur- ners, include the following: ing preparation and implementation. Too many z Getting the NGOs to represent themselves major changes were probably made at once, par- either as a coalition or as a group with which the ticularly of the core team members on the Bank Bank could engage was relatively difficult, and a side, risking the loss of corporate memory of the demanding task on its own. It may have been use- details of preparation. ful to consider initiating work with NGOs, and think about the setup of a coordination group, Concluding Thoughts for Successful earlier in project preparation. Project Implementation z Coordinating disclosure of documents and keep- The efforts described in this paper helped prepare ing a record of what was disclosed and when was a good project that can stand the test of time and challenging at times. It was also time-consuming made sure that the project will be robust to inevitable to verify that the same version of each document change. But that will count for nothing without the was disclosed on the TSHMB and World Bank necessary follow through, with particular attention project websites, and at the Infoshop. paid to the quality of implementation, supervision, z A significant challenge was methodological coor- and monitoring. The importance of close involve- dination because none of the local consultants ment by the World Bank and external technical had done the types of analysis required to fill the consultants, especially in the early years, cannot be gap between Vietnamese and international stan- overemphasized. Continuation of capacity building dards. The model could be further fine-tuned for and technical assistance throughout implementa- future projects by paying particular attention to tion is essential, as is close attention to open com- sequencing and ensuring adequate coverage of all munications. The World Bank intends to continue relevant topics. working with government agencies and companies z Coordination at all levels could have been stron- on how to institutionalize the most promising and ger and might have accelerated project prepara- relevant new approaches introduced under this proj- tion. Standardizing the inputs of the very large ect, and to be replicated during engagement with number of individual consultants with very the broader sector. different levels of English and writing styles, Lessons from Preparation of the Trung Son Hydropower Project 33