With Tajik President Rahmon’s words “Rogun will be the pride of every citizen of our country now and in the future, it will be the source of patriotism and dedication, as well as warm feelings and honor of the Tajik nation!”, the solemn ceremony of launching the first power generation turbine of the Rogun hydropower plant (HPP) was held on November 16, 2018 in Tajikistan [Diplomat, 2018]. Dedicated to the President’s Day, the ceremony was attended by the government officials, foreign participants of the CASA-1000 project, representatives of international organizations, diplomats, as well as journalists, and ended with a gala concert and festive fireworks.
With the 335-meters-tall clay core rockfill dam projected to be the highest in the world, the Rogun HPP located 110 km from Dushanbe is going to be the ninth hydropower plant of the Vakhsh cascade. It will operate six power generation turbines that will have a total capacity of 3,600 MW, which is the equivalent of three average nuclear power reactors. Expected to be the largest hydroelectric power plant in Central Asia, it will double energy production of Tajikistan turning the country into a major electricity exporter in the region [AzerNews, 2018]. Additionally, Rogun will contribute to the reduction of power shortages during winter months and increase the water availability for agricultural activity.
After the ceremony, it was reported that the turbine successfully started to generate its first watts of energy. Actually, the first turbine, mounted in a regular place at the beginning of July 2018, was commissioned with an initial capacity of 100 MW, out of 600 MW of its design capacity. The commissioning of the next unit is scheduled for April 2019. At present, the construction, which is under President Rahmon’s personal control, is continuing, involving more than 20,000 personnel who work in three shifts. Prior to that, on October 29, 2016, Rahmon drove a bulldozer himself, together with workers, to block the Vakhsh River and mark the beginning of the construction of the Rogun dam. Overall, the dam is being built in two stages. The first stage involves the construction of the dam with a height of 135 meters and the installation of two power generation turbines. It is expected to take 3-5 years to fill the dam to the level that will make it possible to run the turbine efficiently, while in total it will take up to 12-15 years to fill the capacity of the dam [News Central Asia, 2018]. Whereas, the second stage is a phase-by-phase construction of the 335-meter high main dam and an installation of the remaining units [Asia-Plus, 2018]. It should be noted that the dam is designed for an operational life of 115 years [Salini Impregilo].
Meanwhile, a protracted delay in the construction that only began in 2016, about two months after the death of Uzbek President Islam Karimov, was due to several challenges, including Karimov’s threat to start war over water in the region. The original project was conceptualized by Soviet engineers in the 1950-60s, and by 1976, the preparatory work began on the construction of the dam, but the project was halted following the independence of Tajikistan. A number of obstacles, such as the internal situation in Tajikistan, lack of financing, Uzbekistan’s objections to the project, were among the reasons why the construction resumed only in 2004. Moreover, the flood in May 1993 complicated the situation, partially destroying part of the dam and the technical premises of the station. Nevertheless, the work activated in 2004, when the Russian company RUSAL financed the research works and partially restored the dam [Sputnik, 2016a]. However, in 2007, the contract with RUSAL was terminated due to the disagreement between the parties on the equity participation, as well as on the height and type of the dam. Particularly, RUSAL insisted on erecting a concrete dam with a height of 285 meters, whereas Tajikistan needed a stone fill-in with a height of 335 meters [Fergana, 2018a]. Since then, the Tajik government decided to manage the project itself and started searching for investors. It applied to the World Bank, which agreed to finance the comprehensive examination of the project. In July 2014, with the support of the World Bank, the techno-economic assessment study and the environmental and social impact assessment of the project were completed. In July 2016, the Italian Salini Impregilo won the tender and signed a $3,9 billion contract with the government-owned Rogun HPP company to serve as the engineering, procurement and construction (EPC) contractor for the project [Salini Impregilo]. Additionally, over 50 subcontracting companies from Iran, Russia, China, Germany and Ukraine, most of which previously participated in other Tajik HPP projects, are involved in the construction of Rogun [Radio Azattyq, 2018].
Meanwhile, the financing of the project was among the main issues slowing down the implementation of the project. In general, Tajikistan, the country with the national budget of around $4.8 billion in 2018, needs approximately $4 billion to fully complete the plant [Regnum, 2017]. Therefore, in order to attract funds for the Rogun HPP, the Tajik government, besides financing from the budget, decided to issue securities. The initial sales of securities started in 2010, when President Rahmon urged his countrymen to buy shares to fund the project, but the need to intensify the sales has become even more urgent since the signing of the agreement with Salini Impregilo in 2016. Therefore, in 2017, the Tajik authorities decided to issue $1 billion worth of securities. In September 2017, to fund the first stage of the project that cost $590 million, Tajik authorities put for sale the first batch of bonds worth $500 million. According to the National Bank of Tajikistan, securities with the annual yield of 7% were sold to investors from the United States (38%), Great Britain (24%), EU countries (35%), and Asian countries (3%) [Radio Azattyq, 2018]. The Tajik government called it a successful debut of state bonds on the international financial market. In addition to the state budget and securities, the government allocated funds from the sales of precious stones and metals. Overall, in 2017, 4.7 billion somoni ($528 million) was spent on the HPP construction from all sources of funding. In order to accelerate the construction, in October 2018, the Tajik government allocated an additional 749 million somoni ($80 million) [Fergana, 2018b]. Simultaneously, the government negotiates with the international financial institutions on attracting preferential loans and looks for other sources of financing, as it hopes to generate money after the launch of the first stage of the project. Cumulatively, since 2008 Tajikistan spent approximately 15 billion somoni ($1.6 billion) on the construction of the Rogun HPP [Radio Azattyq, 2018].
Nevertheless, the position of Uzbekistan was the main obstacle to the construction. Due to the categorical objection of former Uzbek president Karimov, the construction was postponed for many years. The main contradiction was that the Rogun dam is being built on the Vakhsh River, which is the main tributary of the Amudarya River. The Vakhsh River is classified as a trans-boundary shared water resource and contributes about 25% of Amudarya’s water flow. During the filling of the reservoir station, which is estimated to take around 15 years, the flow of water would significantly decrease that would directly impact the agriculture sectors of the downstream countries, the conclusion confirmed by the World Bank’s assessment of the project. Particularly, in Uzbekistan, the area of agricultural land in the Khorezm region might decrease up to 17,7% and in the Karakalpakstan Republic up to 14,6%, which would cause a reduction of cotton production of around 18% [Sputnik, 2016b]. Nevertheless, the Tajik authorities kept saying that the reservoir would be filled at the expense of Tajikistan’s own quota as agreed with all the countries of the Aral basin and none of the neighboring countries in the region would suffer. Tashkent’s another concern was the seismological stability of the Rogun HPP. The plant is being built on the tectonic fault zone with high seismic activity, where earthquakes measuring 6-7 magnitude on the Richter scale have already occurred. In the case of a seismic disaster, a resulting flood could damage the whole region. However, the World Bank’s report concluded that it was possible to start building a hydropower plant if changes were made to the original project.
Remarkably, with the change of the leadership in Uzbekistan, the position of the country also changed. During new Uzbek President Mirziyoyev’s visit to Dushanbe in March 2018, it was announced that Tashkent would possibly participate in the construction of the Rogun HPP, if the project took into account national interests of Uzbekistan [Sputnik, 2018]. After the negotiations, the Tajik and Uzbek leaders announced, “we share the view that the hydropower facilities will help to resolve the region’s water and power issues”. In his turn, Tajik President Rahmon confirmed that “they will never leave neighbors without water” [Reuters, 2018]. Thus, Uzbekistan no longer objects to the construction of the Rogun HPP and is ready to negotiate on the effective implementation of the project for the benefit of both sides.
Therefore, as the neighboring states have generally agreed on the opportunities provided by the Rogun HPP, the full operation of the project should give impetus to the economic development and integration of the region. Moreover, the project is going to provide extra revenues for Tajikistan from exporting electricity to Pakistan, Afghanistan and, potentially, other regional countries that would transform the country into a regional hub for electricity exports. Initially, Tajikistan was planning to export electricity within the CASA-1000 project, which projected the construction of a series of power transmission lines from Tajikistan and Kyrgyzstan to Afghanistan, India and Pakistan. However, in May 2016, due to the expensiveness of the project, Afghanistan refused to purchase the Tajik electricity under this project, agreeing only to ensure its transit to India and Pakistan, which are still interested in its procurement [Eurasia Expert, 2018].
In conclusion, by commissioning the first unit of the Rogun HPP, Tajikistan started to generate electricity that in near future should be available to every Tajik family. Although this is a very first step towards the full energy independence, this step is done, despite the skeptical expectations based on the above-mentioned obstacles. It is estimated that the entire Rogun dam will be completed by 2028, and its water reservoir is planned to be used both for energy and irrigation purposes in dry lands. Thus, the new HPP will help the country to meet its domestic needs and earn revenues from electricity exports, which will be a significant boost for the Tajik economy.
References:
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