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EurasiaNet.org provides information and analysis about political, economic, environmental and social developments in the countries of Central Asia and the Caucasus, as well as in…

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Tajikistan’s Newest Hydropower Project

Rogun dam

The first turbines at Tajikistan’s Roghun hydropower plant are set to go into operation on November 16 — a date chosen to coincide with a national holiday recently created in tribute to President Emomali Rahmon.

The date of the planned start to electricity production at the plant was announced in state media after Pietro Salini, the chief executive of Salini Impregilo, the Milan-based engineering company building the dam, met with Rahmon in Dushanbe on January 31.

At current projections, there will be sufficient water supplies accumulated by the end of the year to get two turbines up and running.

“Work at the construction site is going well and there are a lot of builders involved in various sections. All the workers at Roghun are proud that they are participating in the construction of this hydroelectric power station. For Salini Impregilo too, participation in the construction of this giant facility is a source of pride,” Salini was quoted as saying by the Khovar state news agency in comments translated into Russian.

Salini Impregilo began work on building the dam in October 2016. The Italian company is not responsible for installing the turbines.

Tajikistan and Salini Impregilo are enthusiastic in hailing the scale of the dam. The project entails multiple stages, one of them being the erection of a 335-meter-high rockfill dam — the tallest in the world. Roghun is designed to incorporate six 600 megawatt turbines to make up for a colossal total installed capacity of 3,600 megawatts. Once finished, the plant should be able to produce more than 13 billion kilowatt hours annually.

But questions have regularly been raised about how, and whether, Tajikistan is going to be able to afford the $3.9 billion price tag of seeing the project through to the end.

The government has deployed a variety of means to drum up the cash. In 2010, it organized a massive public float of shares in the project. While a certain number of people were swept up in the all-consuming hype and invested in the shares, many others, including state workers and university students, were forced against their will into buying the stock. Despite those often-crude measures, that effort raised the relatively paltry sum of $80 million. Another attempted float in 2016 failed to get off the ground altogether. Related: Can The Shale Boom Avoid These Bottlenecks?

A certain amount of the annual budget is set aside for completion of Roghun but the sums are relatively minor in view of what will be needed.

Last year, Tajikistan issued $500 million worth of bonds on the international market in their latest attempt to cover costs.

This is why the promised start of production will be so crucial, as Tajikistan hopes to begin paying for the continuation of work by selling excess electricity generated by Roghun.

As to who the buyers will be, this poses another quandary. The long-term vision is to create high-voltage power lines to Afghanistan, Pakistan and even further afield, but that will be some years down the road.

Tajikistan already exports electricity to Afghanistan and Kyrgyzstan, but the volumes are modest. Exports to Afghanistan in 2017 came in at 1.3 billion kilowatt hours of electricity, netting Tajikistan around $50 million. Afghanistan would like to receive greater volumes in winter, but Tajikistan cannot spare the capacity. What meager amounts are being sent through power lines now are purely for reasons of security, Tajik Energy and Water Resources Minister Usmonali Usmonzoda revealed this week.

“This is done for the safety of the line since there is a probability of the wire being stolen if they are not energized. The Afghan side asked us to increase the supply, but we explained to them that we cannot do this,” Usmonzoda was quoted as saying by Baku-based AzerNews news agency.

Kyrgyzstan, meanwhile, also sells back to Tajikistan in accordance with seasonal requirements. Uzbekistan’s policy of bolstering regional ties is certain to present the most attractive option in the near future.

The value of this trade will not represent a quantum leap for Dushanbe, however, and it will be some time yet before revenue from Roghun is such that, if properly invested, it could truly jolt the economy.

A slight fly in the ointment, depending where one stands on the matter, was the announcement in November by aluminum company TALCO that it intends to build a new $1.6 billion smelter together with China’s Yunnan Company. The metals producer says the plant would create more than 1,000 jobs. While that might be so, what the appearance of a such a large new industrial facility would also do is soak up large amounts of spare power capacity. Critics of TALCO have described in detail how the company systematically avoids paying its fair due of taxes to the state coffers. So one potential scenario would be that while a privately and quite nebulously run company rakes in revenue thanks to enhanced electricity generation, neither the treasury nor regular citizens will reap much benefit. Related: Turkey’s Unlikely Energy Allies

At least the biggest problem is out of the way now that Uzbekistan has considerably cooled its formerly fiery rhetoric over Roghun. Tashkent has long objected that the giant dam could severely harm its agricultural interests by tampering with the flow of irrigation waters.

In July, Uzbek Foreign Minister Abdulaziz Komilov was prompted to note that projects like Roghun would be acceptable so long as “the interests of both upstream and downstream countries [are] considered.

“We do not say that our Tajik friends should stop the construction of the Roghun Dam. Go ahead and build it, but we hold to certain guarantees in accordance with these conventions that have been signed by you,” Komilov said.

It was hardly a ringing endorsement, but it marked a dramatic deescalation.

Since 2016, November 16 has been ordained President’s Day — a holiday devoted entirely to celebrating Rahmon. Success in getting Roghun working on that day will inevitably generate yet more voluble state-generated adulation for Rahmon.

By Eurasianet

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