ZOiS Spotlight 41/2018

Prestige project in Tajikistan – the Rogun hydropower plant

by Beate Eschment 28/11/2018
In order to finance the construction of the dam, the government of Tajikistan pressured its people into buying bonds for Rogun. Wladimir Sgibnev

At an official ceremony on 16 November 2018, Tajikistan’s President Emomali Rahmon pressed a button and put the Rogun hydropower plant in operation. In his words, this “fulfilled the long-awaited desire of our civilised nation, and all the hopes and ambitions of our people became reality”. The occasion was indeed marked by lavish public festivities throughout the country. Arguably, however, this was the fulfilment of the President’s own ambition in the face of substantial opposition, rather than the realisation of the hopes of the Tajik people.

Tajikistan is the poorest of the former Soviet republics and has negligible fossil resources. However, it is the most water-rich country in Central Asia, with vast and hitherto largely untapped potential for hydropower generation. The energy supply was shaky for years. The country also has a rapidly growing population. As a result of power shortages, the Tajik people – who are almost entirely dependent on hydroelectric for heating as well – found themselves sitting in the cold and dark during the winter months.

The “Palace of the Light of the Nation”

Once it is completed, the Rogun power plant, situated around 110 km east of the capital Dushanbe, will reach a capacity of 3,600 MW, doubling Tajikistan’s energy production and making this the largest hydroelectric power station in Central Asia (the world’s largest hydropower plant in China has a generation capacity of 22,500 MW, while Germany’s largest hydropower installation in Thuringia reaches around 1,060 MW). The Rogun project includes the construction of a 335-metre rockfill dam, the tallest in the world. However, only the first of the planned six turbines came online in mid-November and is currently operating at a mere sixth of its capacity. The dam itself is just 75 metres high. So there is still some way to go before the project’s scheduled completion in 2033.

This is the second attempt to get this mega-project off the ground. At the time of the Soviet Union’s demise, a dam had already existed on the Vakhsh river for five years. But in 1993, flood waters destroyed the dam and the two-thirds of the plant’s technical installations that had already been constructed. And with the disintegration of the Soviet Union, Central Asia’s complex water and energy supply system – which had guaranteed a supply of cheap energy to Tajikistan and Kyrgyzstan – collapsed, causing power shortages and rationing in the winter months. Upgrading the hydropower system inherited from the Soviet Union by building new facilities seemed like the obvious solution, and from 2000, plans to build a ninth dam of vast Soviet proportions along the Vakhsh river were revived. When the Central Asian power grid – also part of the Soviet legacy – failed during an unusually cold winter in the mid 2000s, President Rahmon made energy independence his priority goal. From 2010 onwards, and with “Rogun means light and life” as its watchword, the country plunged into a frenzy of construction. In autumn 2016, the Italian company Salini Impregilo won the contract to build the dam and the project surged ahead, with 20,000 people working under pressure to take it forward. In autumn 2018, the government provided an additional 749 million Somoni (80 million US dollars) to speed things along. (Tajikistan’s gross domestic product for 2018 is an estimated 7.15 billion US dollars.)

Funding problems

Funding has been a major problem for the project all along. In 2008, after years of failed attempts to secure international financial backing, the government decided to mobilise funds of its own – a decision which met with scepticism from observers. The President declared that it was every citizen’s duty to buy bonds for Rogun, putting the public under substantial pressure to stump up the funds. However, this produced a mere fraction of the target 1.4 billion US dollars. A fresh initiative in 2017 proved more successful: this involved the sale of a package of Eurobonds, amounting to 500 million US dollars, on the international market. The rest of the costs were met from Tajikistan’s state budget. Estimates of the precise figure vary considerably: at the inauguration, Rahmon mentioned the equivalent of around 2.5 billion US dollars coming from the budget. According to the Ministry of Finance, a total of 4 billion dollars is needed for construction to continue.

Sums of this magnitude can only be mobilised if major cuts are made in other key areas of public spending. What’s more, this autumn, there were again numerous reports of power outages plunging rural communities into darkness – seemingly less to do with unpaid bills and unfinished repairs than with the government’s honouring its ambitious export commitments. Since the start of 2018, Tajikistan has exported more than 2.5 billion kWh of power, mainly to Uzbekistan but also to Afghanistan and Kyrgyzstan, generating almost 73 million US dollars in revenue needed for the further financing of the project. So there appears to be little chance of any respite for the Tajik people any time soon. And there is clearly also a shortage of cash to tackle the massive wastage of water and electricity from the creaking infrastructure.

The desire of the nation?

Rahmon, the self-styled Leader of the Nation and old-school autocrat who has held power since 1994, has made Rogun his own personal project. He directly oversees construction, even driving a bulldozer to push rubble into the Vakhsh river at the start of building work in autumn 2016. It was no coincidence that the inauguration took place on 16 November, the official Day of the President. Rahmon urgently needs some positive news stories right now: Tajikistan has already made the headlines several times this year with reports that cast doubt on the country’s stability.

Now more than ever, everything augurs well for the successful continuation of the Rogun project. Under its new president, Uzbekistan – despite its unease about the project – has adopted a more conciliatory stance and has even pledged its support. International financiers are also showing some willingness to cooperate, for example in the power grid expansion that is essential as a basis for electricity exports. Buoyed up by optimism, some journalists in Tajikistan have calculated that when it is fully operational, Rogun will have capacity to export around 10 kWh billion of power, netting the country as much as 400 million US dollars in revenue. But there is still a long way to go. The present political conditions mean that with no consultation, the Tajik people are being forced to make major sacrifices for the sake of their President’s pet project. As things stand, it is impossible to predict whether and when they will repeat the benefits of this self-denial.

Beate Eschment is a Central Asia expert and researcher at ZOiS. She is also the editor of Zentralasien-Analysen. Her current research focuses on identity formation and interest representation among national minorities in Kazakhstan.