Grand Inga comes one step closer

18 June 2008

As the second biggest river in the world by discharge, the hydro potential of the River Congo is undisputed. However, regional poverty, political instability and a lack of transmission infrastructure have all conspired to prevent more than a tiny percentage of the river’s potential being exploited. The Grand Inga scheme was devised as a means of making the most of the river’s resources but has been regarded by many as little more than a distant aspiration because of the scale of the investment required. Yet the World Energy Council (WEC) meeting on the project in London in April suggested that the venture could eventually become the biggest ever hydro scheme.

The Inga site lies west of the capital of Democratic Republic of Congo (DR Congo), in the Bas Congo Province, about 145km from the mouth of the River Congo on the Atlantic Ocean. It is the location of the two biggest operational hydro schemes in the country: Inga I and II, which are owned and operated by the state owned power utility Société Nationale d’Electricité (SNEL). Inga I, which was completed in 1972, has generating capacity of 351MW, while Inga II was completed a decade later with 1424MW. The two projects represent about 4% of the hydro potential of the Inga site, which is by some distance the most attractive hydroelectric location in the Congo Basin for development.

Dam plans

Plans for new dams at Inga have been drawn up on a regular basis for many years but DR Congo’s turbulent independence era history has deterred most investment. Economic development was limited between 1965 and 1997 when the country was ruled by Mobutu Sese Seko under a dictatorship. A series of civil and regional wars broke out after 1997 which resulted in the deaths of an estimated four million people and drew many neighbouring states into the bloodiest conflict since the Second World War.

With United Nations help, DR Congo has stabilised somewhat under President Joseph Kabila and although intermittent fighting continues in the north-east of the country, most regions are now more stable. Foreign investors are keen to develop the country’s plentiful mineral resources, control of which had helped to fuel the conflict, and DR Congo has the potential to become one of Africa’s most prosperous countries. However, it continues to lack secure power supplies and much of the other infrastructure required for an even moderately successful economy.

Following the fall of Apartheid in 1994, South African power utility Eskom talked ambitiously of developing the Grand Inga scheme with massive generating capacity of about 40GW to help provide electricity to much of Africa. DR Congo is part of the Southern African Power Pool (SAPP), which allows SNEL to export some electricity to the south but far higher transmission interconnectors are required if Eskom is to achieve its dream of utilising the Congo’s hydro power across the southern third of the continent.

Over the past decade, plans have been drawn up for a third, more modest dam at Inga, while some work began on rehabilitating Inga I and II, which both suffered from reduced output as a result of the lack of investment and maintenance over many years, and particularly from silting. Feasibility studies on the far larger Grand Inga were carried out by lahmeyer International of Germany and Electricité de France (EdF) but the ongoing conflict in DR Congo made these little more than preliminary studies. The studies did at least provide detailed investigations into the transmission links that would be required to carry electricity to the rest of the continent, but no companies or funding bodies were prepared to invest in the kind of infrastructure that would take several decades of successful use to return a profit in such an unstable country.

However, the WEC has now decided that the time is right to seriously reconsider the venture and there are several reasons to support this view. Firstly, the security situation in the Lower Congo has improved steadily in recent years and while there is ongoing fighting between the Congolese army and Hutu militia in the east, the most infamous of the remaining rebel leaders, General Nkunda, signed a peace agreement with the government in January. The economy of DR Congo remains in dire straits but the political situation is at least calmer.

Secondly, the international community’s willingness to promote African economic growth is increasing and secure power supplies are one of the biggest deterrents to increased investment across most of the continent. It is important not to overestimate the potential impact of Grand Inga in terms of lifting people out of poverty but it can at least be a small part of the solution. Grand Inga would have greater generating capacity than all of Sub-Saharan Africa apart from South Africa combined, so the potential benefits to regional power supplies would be massive.

At the same time, promoting cross-border trade in electricity can be one of the best methods of encouraging more general cross-border trade in Africa. Regional power grids are emerging at different rates in North, West, East and Southern Africa, but Pan-African power grid integration is dependent upon the construction of transmission links through the Congo Basin at the heart of the continent. This has not been possible until now but could be achieved through the Grand Inga project, as it would only be economically viable if power could be exported to North, West and Southern Africa.

Finally, global concern over climate change has made mega hydro schemes such as Grand Inga more internationally acceptable. Funding the project could boost African power supplies and therefore promote African development without greatly contributing to carbon emissions. The venture is therefore far more likely to attract support from the governments of industrialised nations, as well as from the most important international financial institutions.

London conference

The WEC sponsored ‘How to make the Grand Inga hydropower project happen for Africa’ forum in London brought a variety of participants together, including Congolese ministers, representatives of the World Bank, International Finance Corporation and European Investment Bank, and African power company executives. Previous studies have proposed the installation of 52 turbines each with generating capacity of 750MW, giving total capacity of 39GW, but there is a long way to go before the final size of the venture is determined.

It is now estimated that the project would cost US$80B, making it by far the single biggest infrastructural venture in African history. About US$40B would be needed for dam construction, power plant development and associated reservoir costs, with a further US$40B for transmission infrastructure. The WEC is aiming for a three phase approach: gaining wide ranging international support for the venture, so that a full feasibility study can be undertaken; setting up a project framework; and then raising the required finance. Construction work on the project could begin as early as 2014, with first electricity sometime between 2020 and 2025.

The secretary general of the WEC, Gerald Doucet, said: ‘It is the greatest sustainable development project, offering Africa a unique chance for interdependence and prosperity. It’s much more feasible now than ever. There is a peace settlement in Congo, and economic and technical studies have all shown it is possible.’ He added: ‘The banks and the City of London see that Grand Inga is serious. The G8 countries are behind it because they can get UN clean development mechanism (CDM) credits to offset their emissions. Chinese, Brazilian and Canadian dam building companies, as well as the World Bank, are all interested.’

The feasibility study on the scheme will encompass a technical study; environmental impact assessment; social impact study; cost estimates; implementation schedule; financial and economic evaluation; cooperation agreement; and sustainable management plan for the construction and operation phases.

Given the huge generating capacity on offer, the scale of the planned dam and reservoir is not great. The 205m high dam would be substantial but not among the world’s highest. In addition, the 15km long reservoir pales into insignificance in comparison with the Three Gorges Dam project in China and the Volta River scheme in Ghana. The huge generating capacity is possible because the river drops almost 100m in just 13km.

Doucet commented: ‘We have to raise the level of access to commercial energy all through Africa and other parts of the world, where this poverty is faced. We can’t do it without building these projects, but of course, on a sustainable basis that takes into account the social, civil and environmental issues. And I can say that in the past, mistakes have been made, but WEC is here to make sure those mistakes are not repeated.’

Three main transmission lines will run from Inga to Nigeria, South Africa and the rest of the SAPP, and to Egypt. In the past it has been suggested that electricity from Grand Inga could be exported to Europe and the Middle East but it remains to be seen whether the transmission losses that would be incurred over such distances would make the scheme economically viable. However, the WEC concludes that the price per kWh generated at Inga and transmitted to the Italian border, for example, ‘would be lower than the market price in Italy today’.

Eskom is still clearly behind the project, particularly because of the power shortages that are currently plaguing the country. The company plans to import electricity from new hydro schemes in Mozambique as well as from Inga. The company’s chief executive, Jacob Maroga, said: ‘Given the international climate change imperatives, we plan to reduce the coal component of our optimised portfolio to 70% by 2025.’ At present, coal fired plants contribute almost 90% of the company’s power production.

Inga III

The London delegates also considered the results of a new pre-feasibility study on Inga III that was completed in February by SNC Lavalin. The 4320MW Inga III run-of-river scheme could certainly be used to drum up interest in Grand Inga. It is not often that a 4GW scheme can be described as a pilot project but Inga III could serve this role to prove the ability of DR Congo and funding organisations to support the massive outlay required for Grand Inga.

Inga III would produce more electricity than DR Congo could absorb and so new cross-border transmission lines would be required to make it economically viable. Any interconnectors developed for Inga III could also be utilised by Grand Inga, thereby reducing the costs per megawatt-hour at the Inga site as a whole.

In addition, the Inga III dam would be constructed on a different section of the Inga rapids to Grand Inga and so it is hoped that the two projects can be developed to complement each other, rather than in competition. Combined output from Inga III and Grand Inga is estimated at 320TWh of electricity a year, with production costs of 2.1 US cents per kWh (c/kWh) and 1.1-1.4 c/kWh respectively. Average annual flow rate is put at 42,000m3/sec.

Western Power Corridor (Westcor) has been set up to develop Inga III. The company is owned by Eskom and Botswana Power Corporation, Empresa Nacional de Electridade of Angola, NamPower of Namibia and SNEL, all of which stand to benefit from the project.

While the focus of Grand Inga will be on the export market, there is a strong possibility that much of the output from Inga III will be dedicated to the Congolese market. Doucet commented: ‘The Congo owes it to its people and will be required in my view by its people to improve the access to electricity in Kinshasa and in the neighbouring areas of Inga. There definitely is a growing desire to use Inga III electricity in the Congo itself.’

Only further hydraulic and geological studies are required before construction work on Inga III can begin, possibly as early as next year. The turbines would be brought on stream between 2018 and 2021, with development costs of US$3.5B for the power side of the project and at least US$1.5B in transmission infrastructure. BHP Billiton’s aluminium smelter at Moanda, which is about 150km from Inga, has been mooted as a likely customer for electricity from the project.

Interest in Grand Inga could also finally result in the refurbishment of Inga I and II, which the London forum heard are currently operating at just 52% and 34% of capacity respectively. A WEC spokesperson revealed that the planned modernisation, which is being carried out by MagEnergy of Canada, is at least 15 months behind schedule.

Evaluating the downside

Non-governmental groups (NGOs) opposed to Grand Inga have been quick to point out the obvious downsides. Terri Hathaway, Africa campaigner at International Rivers, commented: ‘The project would be a magnet for corruption in one of the world’s least stable regions. Its enormous budget and large contracts could devolve Inga into a corruption riddled white elephant. Inga will centralise a vast store of the region’s electric and financial power, a development model that can foster tensions and civil wars.’

She continued: ‘As it stands, the project’s electricity won’t reach even a fraction of the continent’s 500M people not yet connected to the grid. Building a distribution network that would actually light up Africa would increase the project’s cost exponentially.’

There is no doubt that corruption is a real threat, while electricity will only be supplied to centres of existing high demand for electricity, such as mines, smelters and South African. Those who market Grand Inga as a means of supplying electricity to poor African villages miss the point that only those who can afford to pay will be supplied.

On the other hand, funding transmission links across the African continent will enable other potential power projects to provide on-grid electricity and encourage the spread of distribution networks. Grand Inga would not necessarily mean that more Africans would gain access to electricity but there is little chance of electrification unless the continent’s total generating capacity is increased, whether by local, off-grid renewable energy projects, or by the kind of grand generating schemes, such as Grand Inga, that politicians favour.

At present, just 1% of the rural population of the Congo Basin has access to electricity, so Grand Inga will hardly have a negative impact on the current situation. However, governments and multilaterals involved in the Grand Inga consortium could guarantee that some development goals are met, such as ensuring that more towns are supplied with on-grid electricity and by helping to make regional, lower voltage transmission links to the new long distance interconnectors more affordable.

According to the WEC, the area that would be flooded by the dam is unpopulated. Flora and fauna in the area would undoubtedly be affected but some attempt at mitigating the negative affects will be required by funding institutions. Moreover, the area to be flooded is small in relation to the power produced, particularly in comparison with other large hydro schemes in Africa and beyond. If the environmental scorecard on recent dam projects in Ethiopia, Uganda and Ghana is considered to be positive, then Grand Inga should pass most environmental tests.

Press reports of Grand Inga being ‘in sight’ and ‘on the way’ are wide of the mark. Project finance and Congolese instability remain huge obstacles and securing the cooperation of many different companies, multilaterals and national governments will be a mammoth task. Yet the WEC and many of the delegates at the London meeting seemed convinced by the plans and successive feasibility studies have concluded that the venture is technically and economically viable.

Such a vast scheme would be an impressive undertaking for the hydro industry and one which may test the abilities of countless engineers.

World Energy Council principles on Grand Inga

• Provide immediate benefits to the people living in the Inga River area by providing access to electricity and job creation to improve their standard of living.
• Bring affordable and clean electricity to DR Congo and other African countries, thereby promoting economic interdependence, peace and prosperity in the region and among involved African states.
• Sustain the development of the projects through the creation of a ‘Zone Inga’.
• Develop the projects on the basis of commercial principles, including risk management and the right pricing for the electric power.
• Stimulate African sustainable development.

Grand Inga key data

Height of the dam - 205m
Water flow volume - 8.4Bm3
Water flow distance - 150km
Length of the reservoir - 15km
Average annual flow rate - 42,000m3/sec
Estimated cost of dam - US$40M
Estimated cost of transmission - US$40M
Estimated production cost - 11-14US$/MWh

Inga in brief

Exisiting plants – Inga I and II
• Location: 250km southwest of Kinshasa, DR Congo.
• Inga 1: installed capacity is 351MW and project was commissioned in 1972.
• Inga 2: installed capacity is 1424MW and project was commissioned in 1982.

Under development – Inga III
• Installed capacity 4320MW, to be commissioned progressively in the period 2018-2021.
• Pre-feasibility study by SNC Lavalin now completed and presented in February 2008 to the government of DR Congo.
• Investment cost for the power generation plants: about US$3.5B
• Investment cost for the transmission system for the Westcor countries: about US$1.5B.
• Investment cost for the 150km Inga to Moanda transmission line to supply the BHP Billiton aluminium smelter: to be determined.

To be developed: Grand Inga
• Potential Capacity: 40GW.
• Pre- feasibility study carried out by Electricité de France (EDF) and Lahmeyer International in 1997, with preliminary studies by SNEL in 2005.
• Investment cost of the hydro plants: estimated at more than US$40B.
• Investment cost of the transmission system: estimated at more than US$40B.
• Interconnection transmission system (HVDC) would include: Northern Highway (Between Inga and Egypt); Southern Highway (Between Inga and South Africa); Western Highway (Between Inga and Nigeria).

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