WHAT JUST HAPPENED?
Two hydroelectricity plants of the Baihetan Giant, the largest ever hydroelectric dam to be built worldwide, produced energy for the first time on Monday on the Yangtze River in Southwest China.[1]
WHAT DOES THIS MEAN?
The Baihetan was built by the China Three Gorges Corporation and is China's most significant and most challenging engineering project, with a dam height of 289 metres. 4 years of build. Once the project's first two 1-giga watt turbines start operating after a three-day trial, it will have a total generation capacity that is second only to the Three Gorges Dam once it is completed in July 2022.[2]
"As a major project in China's west-east power transmission program, Baihetan is the largest and most technically difficult hydropower project currently under construction in the world." When President Xi Jinping said this, it showcased China's ability to undertake and complete high-end equipment manufacturing projects successfully.[3]
The reasoning behind such grand-scale projects is not to illustrate the country's greatness and the notion of entering the Guinness World Records for being the most prominent infrastructure of its kind. The project is part of a national scheme to generate electricity and deliver it to high energy-consuming regions on the eastern coast. It is also designed to strengthen control over water flows during the heavy summer flood season.[4]
The Baihetan plants are one of the many projects that China is strategically using as a source of leverage to exert control over downstream countries. Subsequently, this event follows the strategic act of China in 1951 when it annexed the water in the Tibetan plateau, which was the starting point of Asia's ten major river systems. Such seismic shift gave China a monopoly over Asia's water map. It has exploited this advantage by building 11 giant dams on the Mekong before the river crosses into Southeast Asia. It follows, China has secured the ability to turn off the region's water tap.[5]
HOW DOES THIS IMPACT THE LEGAL SECTOR?
Upon the launch of this plant, it will have the ability to resolve electricity shortages during peak demand periods in provinces in eastern and central China with larger populations.[6] An example of this is Guangdong, a city recognised as an economic and export powerhouse with an annual gross domestic product equivalent to South Korea. Due to the acceleration of economic activity resumption and constant high temperatures, electricity consumption has been increasing. Consequently, this has meant that some local power firms in the city had to issue notices urging factory users in the region to halt production during peak hours, between 7 am and 11 pm, or even shutting the production for more than two days depending on the power demand situation.[7]
On a positive note, this will help the central government meet its climate change goals. However, Environmental groups have criticised the large-scale damming of the Yangtze and its tributaries because of concerns the over-engineering of the river has destroyed significant habitats and damaged natural flood plains.[8] Consequently, more than 350 lakes in China have disappeared in recent decades, and river fragmentation and depletion have become endemic.[9] The social cost is no less severe. This is because the weather around the Baihetan and the young age of the dam means that there are chances of catastrophic failures that could impact the lives of those living near these gigantic infrastructures.[10] As such, law firms advising their clients in these projects will need to factor in these risks and formulate contingency plans for their clients if such failure does become a reality.
Other legal implications that follow suit from undertaking such a grand-scale project are relocating individuals who live around the construction. In 2007, just as China's mega-dam-building drive was gaining momentum, then-Prime Minister Wen Jiabao revealed that China had relocated 22.9 million people to make way for water projects since the CPC's rise to power a figure larger than more than 100 countries' entire populations. The Three Gorges Dam alone displaced more than 1.4 million people.[11]
This doesn't seem to bother the CPC much. Baihetan's inundation of vast stretches of a sparsely populated highland has forced residents, mainly from the relatively poor Yi nationality, to farm more marginal tracts at higher elevations. As China shifts its focus from the dam-saturated rivers in its heartland to rivers in the ethnic-minority homelands, the CPC annexed, China's economically and culturally marginalized communities will suffer the most.[12]
Written by Amarjit Tark
ASSESSING FIRMS:
#Clifford Chance #Linklaters #Allen & Overy #Milbank LLP #Shearman & Sterling #Ashurst #Herbert Smith Freehills #DLA Piper Hong Kong #Mayer Brown #Norton Rose Fulbright #White & Case LLP #Pinsent Masons
REFERENCES:
[1] Edge Media, ‘China functionalizes Baihetan Hydro Project’ (The Edge Media) dated 28th June 2021.
[2] David Stanway, ‘China starts Baihetan hydro project, biggest since Three Gorges’ (Reuters) dated 28th June 2021.
[3] David Stanway, ‘China starts Baihetan hydro project, biggest since Three Gorges’ (Reuters) dated 28th June 2021.
[4] ‘Daily Briefing (28/06/2021) – Today’s climate and energy headlines’ (Carbon Brief) dated 28th June 2021.
[5] Brahma Chellaney, ‘With massive dams, China finds a weapon’ (thejapantimes) dated 22nd June 2021.
[6] David Stanway, ‘China starts Baihetan hydro project, biggest since Three Gorges’ (Reuters) dated 28th June 2021.
[7] Muyu Xu, ‘China’s Guangdong orders factories cut power use as hot weather strains grid’ (Reuters) dated 27th May 2021.
[8] David Stanway, ‘China starts Baihetan hydro project, biggest since Three Gorges’ (Reuters) dated 28th June 2021.
[9] Brahma Chellaney, ‘With massive dams, China finds a weapon’ (thejapantimes) dated 22nd June 2021.
[10] Brahma Chellaney, ‘With massive dams, China finds a weapon’ (thejapantimes) dated 22nd June 2021.
[11] Brahma Chellaney, ‘ China has an insatiable appetite for super dams’ (CNA) dated 27th June 2021.
[12] Brahma Chellaney, ‘With massive dams, China finds a weapon’ (thejapantimes) dated 22nd June 2021.