The following Frequently Asked Questions (FAQs) summarise key findings on the MRC commissioned Strategic Environmental Assessment (SEA) of proposed hydropower on the Mekong mainstream, Final Report. The intention of these FAQs is to summarise the SEA into brief points, and to address some of the questions which go beyond the report. Main questions answered in this FAQ include: What are some of the Final Report's main conclusions? How does the SEA relate to the Procedures for Notification, Prior Consultation and Agreement (PNPCA) Process? How does the SEA relate to the BDP? And, what are the MRC’s perspectives on the SEA?

SEA Background

What is the SEA?

• A SEA addresses the broader strategic issues relating to policies or programmes that go beyond a single project:
  SEAs follow similar steps to project-specific Environmental Impact Assessments (EIAs), but have much larger boundaries in terms of time, space and subject coverage. The SEA is a tool to examine the broad strategic concerns which need to be resolved and decided on, prior to making project specific decisions. The SEA, commissioned by the MRC, provides an understanding of the implications of proposed mainstream hydropower development and recommendations on whether and how such projects should best be considered by Member Countries.
• The SEA process is a comprehensive approach to assist Member Countries and wider stakeholders in assessing the development risks and opportunities of mainstream Mekong hydropower proposals: Whereas the SEA report and analysis is not produced by the MRC, but by the SEA Consultant team, the SEA stakeholder participation process was coordinated and funded through the MRC's Initiative on Sustainable Hydropower (ISH), a cross-cutting initiative working together with all MRC programmes. The SEA comprised 4 main phases: (i) scoping, (ii) baseline assessment, (iii) opportunities & risks assessment, and (iv) avoidance, enhancement and mitigation assessment. Each phase included the preparation and circulation of a set of reports as the basis for consultation and feedback. The SEA was a collaborative process involving the MRC Secretariat, government agencies of the four Member Countries as well as civil society, the private sector, other stakeholders and a research institute from China. The SEA process was authorized by the MRC Joint Committee as part of the overall ISH work programme.
• The SEA is a response to a growing interest in hydropower development along the mainstream Mekong: The growing interest in mainstream Mekong development follows the resurgence of interest in hydropower to develop indigenous energy resources, the interest of Lao PDR and Cambodia to generate revenue from power exports to meet growing demand in Thailand and Viet Nam, as well as the increased global emphasis on reducing carbon emissions from electricity generation. At the same time, the completion of large hydropower projects in China, which will result in increased dry season flows downstream, raises the potential for generation from mainstream hydropower development in the Lower Mekong Basin. Many of the proposed projects have been identified for over 15 years, but it is the recent interest among private sector developers, mostly from the Asia region, that has led to the current plans being developed to a more advanced stage of feasibility study under regulatory systems established by the governments. The SEA is therefore a response to a high volume of investor and developer interest in the twelve hydropower projects proposed for the mainstream LMB. It is intended as a preparation measure for, and as input to, the MRC's formal consultation process under the PNPCA, to feed into the MRC Basin Development Plan (BDP), and ultimately to inform national decision processes concerning the mainstream proposals.
• The SEA draws extensively from MRC programme work: An inclusive and participatory process, the SEA builds upon MRC programme work over several years, especially work on scenario assessments by the Basin Development Plan (BDP-Phase 2), the modelling team in the Information and Knowledge Management Programme (IKMP), and the data and studies of the Environment, Fisheries and Navigation Programmes. The SEA featured extensive consultations with government agencies, civil society, private sector developers and donor partners both at the national levels in each of the four LMB countries. Regionally, China participated in the SEA process through the Ecosystem Study Commission for International Rivers (ESCIR), by exchanging information through its modelling teams, facilitating visits to the dams in China and contributing presentations to SEA regional workshops.
• The SEA seeks to identify the potential opportunities, contributions and risks by assessing alternative mainstream Mekong hydropower development strategies: In particular, the SEA focuses on regional cost distributions and benefits with respect to economic development, social equity and environmental protection. As such, the SEA supports the wider Basin Development Planning (BDP) process by complementing the MRC BDP assessment of basin2 wide development scenarios with more in-depth analysis of power related and cross-sector development opportunities and risks of the proposed mainstream projects in the Lower Mekong Basin.
• The SEA offers conclusions and recommendations that draw together the strategic assessment of the 12 LMB mainstream projects in the context of sustainable development of the Mekong River and implementation of the 1995 Mekong Agreement: The SEA directly enhances the baseline information and assessment framework for subsequent government reviews of project-specific Environmental Impact Assessments (EIAs), prepared by developers. It helps MRC decide some of its research priorities, studies and investigations that need to be undertaken by MRC Programmes to reduce the risk and uncertainties about the development of mainstream dams.

SEA Outcomes

What are some of key messages in the SEA Final Report outcomes?

• The SEA presents opportunities and risks associated with mainstream hydropower development: The 12 proposed LMB mainstream projects offer considerable development risks as well as considerable development opportunities for the LMB countries. Some of the increased risks include an irreversible loss in fisheries with related livelihood and nutrition impacts, changes in sediment flows and sediment-nutrient balances and ecological diversity, while the opportunities include the significant power benefits resulting in national economic gains, the benefits that accrue from the large investments in goods and services, as well as greater navigation possibilities with increased water levels, localized irrigation potential and offsetting thermal power station emissions.

SEA Summary of economic opportunities & risks for LMB countries for all 12 LMB mainstream projects

Cambodia Serious adverse consequences for fisheries and fishers, food security and poverty reduction Significant benefits from power sector development, secure and less expensive power for industry and economic diversification in the long term Fisheries losses likely to out-weigh benefits of power production at least in the short to medium term
OPPORTUNITIES		RISKS
Significant benefits from less expensive and secure national power supply (replacing costly diesel imports) Increaed competitiveness in manufacturing sector Increased government revenue from power export and taxes Increase in irrigable area and agricultural productivity in some areas Longer term strategic flexibility in power supply once concession periods end		Loss of fisheries resources and significant impact on food security Livelihoods disruption of over 1.6 million fishers Loss in GDP through economic losses in fisheries and agriculture Ancillary services and processing would suffer Loss of sediments and associated nutrients to Tonle Sap system, and associated adverse impacts on primary production, flood forest and local/migratory fish Loss of river bank gardens - likely to be significant for riparian communities in some areas Loss of fertility and agricultural productivity in flood plains Loss of tourism assets and revenue Lack of national grid may inhibit equitable distribution of power Loss of biodiversity
Lao PDR Likely significant overall economic benefit – this is likely to be unevenly distributed Negative impacts on vulnerable communities likely to be significant GoL expenditure of increased net revenues could help ameliorate negative impacts
OPPORTUNITIES		RISKS
Significant benefits from economic stimulus of FDI in LMB mainstream hydropower May see net revenue benefits in concession period depending on the design of financing agreement and adequate oversight capacity Likely to see significant benefits after 25 year concessions end and the projects transferred to GoL Benefits of increased irrigable area and agricultural productivity in some areas Improvement in navigability for med/large vessels upstream of Vientiane Longer term strategic flexibility in power supply once concession periods end		Possibility of macro-economic imbalances developing due to booming hydropower sector Loss of fisheries – likely to affect food security and livelihoods of vulnerable populations Loss of river bank gardens particularly significant in Lao PDR Loss of valuable tourism assets Loss of biodiversity
Thailand Overall economic benefit although insignificant for national economy Economic risks to livelihoods for riparian communities in the basin
OPPORTUNITIES		RISKS
Will receive significant portion of the economic benefits of power from imports Improvement in navigability for med/large vessels in upper reaches of the LMB		Loss of fisheries Loss of agricultural land Possible loss of eco-tourism assets
Viet Nam ? Likely overall economic loss Losses borne predominantly by poorer communities in the Mekong delta
OPPORTUNITIES		RISKS
Will receive significant portion of the economic benefits of improved power supply (from imported power)		Significant loss in fresh water and marine capture fisheries and aquaculture – likely to affect livelihoods of fisher folk in delta - especially poorer groups Loss of sediments and associated nutrients, significant adverse economic affects to deltaic sedimentation, fisheries (Mekong and marine) and agriculture

• The SEA considered four Strategic Options for mainstream hydropower development: The SEA has described and consulted on four Strategic Options:
  1. No mainstream dams;
  2. Deferred decision on all mainstream dams for a set period;
  3. Gradual development of mainstream power; and
  4. Market driven development of the proposed mainstream projects.
  The SEA assessed each of the four options, based on the four assessment phases and findings of the SEA and makes detailed recommendations for each strategic option so that the LMB governments have guidance on critical issues whichever strategy is adopted.
  

What are some of the reports main conclusions?

• The SEA consultant team recommends a 10-year deferral for mainstream hydropower development:The SEA consultants advise that due to the uncertainties regarding scale and irreversibility of risks in such a complex river system, that decisions on mainstream dams should be deferred for a period of up to ten years, with reviews made every three years, to ensure that the necessary conditions to strengthen understanding of the natural systems as well as management and regulatory processes are conducted effectively.
• Trans-boundary impacts are a key message: The impacts of the LMB mainstream schemes must be seen in relation to the cumulative and trans-boundary impacts of the growing number of LMB tributary hydropower projects and the storage dams on the Lancang River in China. Reviewing the possible impacts of individual projects individually does not offer a complete picture. The specific impacts (positive and negative) of the proposed mainstream dams are additional to the effects of the committed 41 large hydropower schemes on Mekong River tributaries by 2015, the 8 storage schemes in the Lancang-Mekong Basin in China, as well as cumulative impacts of other non-dam pressures on the Mekong's natural resource systems.
• Equity of development benefits at national and local levels need to be assured: One central issue in the SEA Final Report is the distribution of costs and benefits, both regionally and locally. National benefits from electricity generation need to be shared with affected and vulnerable river communities. Benefits that may accrue at the regional or national level need to also be shared with vulnerable groups who may suffer the greatest adverse impacts in terms of loss of livelihood opportunity derived from riverine resources, nutrition and cultural loss. It is important to recognise that these impacts are both cumulative and trans-boundary in nature.

MRC's Perspectives on the SEA

As a technical advisory body, to what extent does the MRC Secretariat support the final SEA recommendations?

• As with any commissioned study, the SEA report is not an official MRC approved document:: The final report document needs to be discussed by the various MRC bodies and does not therefore necessarily represent the MRC’s views, conclusions or recommendations. The document was prepared for the MRC by the SEA Consultant team to assist the MRC’s Secretariat with information gathering.
• The SEA report and supporting material will be made widely available and circulated to all SEA stakeholders: The
  Final Report Summary is translated into the four MRC Member Countries’ languages. The report and its> recommendations will be discussed with MRC bodies including the National Mekong Committees and the MRC Joint Committee. One immediate main function is to inform the formal MRC prior consultation process (see FAQ below) on individual mainstream dam proposals, as with the Xayaburi dam proposal. The SEA provides the much needed framework of cumulative assessment which individual projects can then be reviewed.
• The MRC pro-actively supports Member Countries to prepare for decisions on mainstream Mekong hydropower proposals with the aim to reach a common agreement: One of the main objectives of the SEA is to identify knowledge gaps on key issues that impact the entire LMB and to make informed judgements in arriving at its recommendations. In the event that after the joint consultation process Member Countries decide to pursue mainstream development, the MRC will support Member Countries by providing necessary guidance on planning and design issues relating to project sustainability and mitigation of trans-boundary impacts as well as on monitoring requirements.
• Mainstream hydropower development is complex, controversial and irreversible: Sufficient consensus is required for a long-term vision of the balance between water resource development and protection. The integration of these decisions coupled with energy and power sector strategies, national policies and bilateral and regional agreements, in the power sector, as well as other impacted sectors (fisheries, agriculture and navigation) need to internalise the implications for poverty reduction strategies, to meet national development targets.

What are some of the next steps for the MRC on the SEA?

• The MRC will make the SEA Final Report available for public viewing on its website: In addition, the MRC has translated the Summary of the Final Report in all riparian languages, also available on the RMC website at http://www.mrcmekong.org/ish/SEA.htm
• The MRC will propose to conduct consultations with the MRC programmes, and possibly with Member Countries, on the final report and its findings and recommendations for next steps.
• SEA recommendations assist the MRC with future programme planning: Recommendations for actions in the SEA such as research, data collection, monitoring and consultation processes, and strengthened management and regulatory systems to name a few, can assist the MRC in its programme work plans for the coming years in cooperation with MRC development partners and stakeholders.

Stakeholder's Perspectives on the SEA

What are some of the stakeholders’ perspectives on the SEA?

• The SEA has been intensively consultative: The SEA has involved over 60 line agencies, 40 NGOs and civil society organisations and some 20 international development organisations in meetings and workshops. The SEA process also included the participation of China through the Ecosystem Study Commission for International Rivers (ESCIR).
• Stakeholders' views on development in the Lower Mekong Basin is varied as witnessed throughout the SEA process: Stakeholder's views formed the basis of the four Strategic Options that were presented in the final stages of the SEA process to represent their views on avoiding, deferring, or proceeding with mainstream hydropower development.
• Stakeholder consensus on SEA topics include strengthening communications with affected communities and equitable benefit sharing: Stakeholders agreed that trans-boundary impacts need to be addressed comprehensively by national governments, including those that will be caused by projects already underway. Communications strategies and information exchange among riverine communities needs to be improved to help communities understand the full extent of how they would be impacted. Stakeholders also agreed that meaningful steps need to be taken to assure equitable distribution of benefits and costs of mainstream Mekong hydropower development. Mechanisms also should be developed to deliver benefits to affected communities through apportionment of benefits accruing at national levels to address benefit sharing concerns.
• China was involved as a key stakeholder through the Ecosystem Study Commission for International Rivers (ESCIR): As an MRC Dialogue Partner, China, along with Myanmar, participated in national workshops, data exchanges and presentations to other SEA stakeholders. Visits to Chinese dams were also organised for the MRC by ESCIR.

The SEA and the Basin Development Plan

How does the SEA relate to the BDP?

• The SEA is time bounded and provides strategic inputs to the ongoing BDP: SEAs are also part of the legal framework of assessments required by an increasing number of LMB countries. The SEA of proposed mainstream hydropower projects focuses on a subset of the scope of the broader BDP and specifically addresses the risks and opportunities of one group of highly contested projects. The Basin Development Plan is an integral part of the 1995 Mekong Agreement as a rolling joint planning process to help the MRC member countries develop and manage the Mekong water and resources in a sustainable and equitable manner. The BDP works across all water related sectors (irrigation, navigation, fisheries, flood management, environment protection, etc), analysing potential synergies and conflicts between them, to provide a basin-wide perspective on how well national water resources development plans, including hydropower development, will help achieve an acceptable balance between economic, environment and social outcomes in the LMB.
• The SEA and the BDP have a different scope: The scope of BDP goes beyond consideration of mainstream dams to look at a broad range of future development scenarios including water for irrigated agriculture and urban/ industrial use, tributary hydropower, and flood risk management in the Mekong Delta. The SEA brings mainstream hydropower, regional power, and energy parameters into a sharper focus of the current planning cycle to address urgent questions in the basin. The SEA complements the BDP scenario assessment with recommendations for avoidance, mitigation and enhancement measures. It also helps member countries broaden their planning options by providing alternative assessments for energy and power. Both the SEA and the IWRM-based Basin Development Strategy provide the background framework of analysis within which to conduct the MRC's prior consultation process on any individual project.
• The SEA provides recommendations that address the impacts of the BDP Definite Future Scenario (DFS): The SEA provides recommendations that address potential impacts of the BDP Definite Future Scenario including operational considerations for the Lancang-Mekong mainstream dams in China and up to 28 LMB tributary hydropower projects in the Lower Mekong Basin. In preparing the IWRM-based Basin Development Strategy that draws on both BDP scenario and SEA assessments, member countries have agreed to prioritize the development of mitigation measures for the DFS in the next five years. This will be part of the early implementation of the Strategy upon its approval, expected in December 2010.
• The process of incorporating the SEA outcomes into the BDP is ongoing: The IWRM based Basin Development Strategy is being updated in preparation for approval by the MRC Council in December 2010. How the SEA can specifically be incorporated into the BDP was one important discussion point at the recent Third BDP Regional Stakeholder Forum and is being addressed by the MRC Secretariat. The Strategy draws on the results of both the BDP Scenarios and the SEA to build Member Countries�f shared understanding of the opportunities and risks associated with water resources development, including hydropower development in LMB. This leads to the agreement on a set of priority Strategic Guidance that member countries will implement to optimize the opportunities and minimize the risks. Both processes have come up with similar recommended further studies to address the uncertainties and these have been included as priority actions by Member Countries and the MRC in the next five years. For proposed mainstream dams, this includes the MRC PNPCA process and national environmental and licensing processes. The SEA will be used to inform detailed discussions on the hydropower projects during those review processes while the BDP provides a broader picture of cumulative impacts of combined hydropower and other water resources development.

The SEA and the PNPCA

How does the SEA relate to the Procedures for Notification, Prior Consultation and Agreement (PNPCA) Process?

• MRC Member Countries adhere to the PNPCA process to assure regional cooperation: At regional level, MRC Member Countries have adopted a protocol under the 1995 Mekong Agreementwhich commits them to submitting mainstream project proposals to other Member Countries before any decision is made for it to proceed. This process requires extensive prior consultations aimed to reach agreements on whether to proceed with a project and if so, under what conditions. That full PNPCA process was first triggered by the Government of Lao PDR for the Xayaburi hydropower proposal in September 2010.
• The SEA is immediately relevant to the MRC's Procedures for Notification, Prior Consultation and Agreement (PNPCA) Process: The SEA provides the overall framework of analysis of risks and opportunities of mainstream development within which individual projects such as Xayaburi will be assessed. It examines cumulative impacts and questions of distribution of benefits and impacts.
• The SEA primarily relates to the PNPCA Process as a technical input, but it is also a process: The MRC has been working pro-actively to assist Member Countries prepare for decisions on mainstream hydropower proposals. Much of MRC's research work over the years on environmental issues and fisheries has been used in the SEA and in the process it has been compiled and synthesised. The SEA process itself incorporated a national and regional dialogue process where all parties now have greater familiarity with the issues and confidence in multi-stakeholder approaches. This will enable the PNPCA to start at a more advanced level of understanding and cooperation. In compliance with the 1995 Mekong Agreement, the PNPCA states that in the event of the development of mainstream hydropower projects, rigorous prior consultation that aims at arriving at an agreement by the Joint Committee of the MRC is required. That ultimately will be a negotiation process informed by the knowledge base accumulated by the MRC and others and which has been summarised in the SEA.