1. Economic Development and
Environment in Africa: The
Inga Hydroelectric Project
Charles Hernick
Presentation to GE519: Energy, Society, and the Environment -
Boston University
5 February 2015

2. About Cadmus
• Employee-owned company
• Staff have worked in over 100 countries including
conflict, post-conflict, and transitional economies
• Employs over 400 full-time professional staff
members
• Leading provider of environmental compliance
services to United States Agency for International
Development (USAID)
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2/9/2015

3. USAID’s Mission
“We partner to end extreme poverty and to
promote resilient, democratic societies while
advancing our security and prosperity”

4. WORLD BANK GOALS
By 2030:
• End extreme poverty by decreasing the
percentage of people living on less than $1.25 a
day to no more than 3%
• Promote shared prosperity by fostering the
income growth of the bottom 40% for every
country

5. Need for electricity in DRC
• Generally, there is a positive link between
infrastructure and economic growth
• Unreliable power has significant opportunity costs
– Power outages:
• 12.3 power outages a month vs. 5.6 for all other countries
(averaged)
• 4.9 hrs. per month of outages vs. 2.7 hrs. for other countries
(averaged)
• Mining companies in DRC estimate constant energy could increase
output by 40%
• Estimated annual loss in sales of 6%, and an estimated 6.2%
decrease in GDP
• Significant direct costs for backup generators and fuel

7. Generation Options

8. • The “full cost” of
each energy
source varies

9. Electricity
Distribution
• Micro-grids
– Self-contained
– Independent power
producers
• Regional Grids
– Interconnected
– Redundant sources

11. Why Hydropower?
Advantages
• Renewable
– No natural resources
consumed
• Decreased air emissions
• Reliable (water flow)
• Flexible
– Can alter energy output
based on need
Disadvantages
• Expensive to build
• Environmental impacts
– Ecology
– Agriculture
– Water

12. Environmental and Social Impact Assessment:
Putting Together Parts of the Puzzle
• Inform Design
– Current state
– Evaluate impacts
– Avoid significant
impacts
• Better decisions
• Better projects

13. Environmental Impacts
• Resources
– Soil/Geology
– Flora
– Fauna
– Air
– Water
– Climate Change
• Long and Short Term

15. Social Impacts
• Affected people
– Lost income
– Resettlement
• At risk populations
– Women
– Indigenous People
– Disabled
– Young and old
• Cultural Heritage and
Resources
– Structures/archeology
– Cultures
– Traditions
– Intellectual Property

16. Ecosystem Services
Provisioning Regulating Cultural
Food Air Quality Regulation Spiritual and Religious Values
Crops Climate Regulation Aesthetic Values
Livestock Global Recreation and Ecotourism
Capture Fisheries Regional and Local
Aquaculture
Water Regulation
(hydro power focuses here)
Wild Foods Erosion Regulation
Fiber
Water Purification and Waste
Treatment
Timber Disease Regulation
Cotton, Hemp, Silk Pest Regulation
Wood Fuel Pollination
Genetic Resources Natural Hazard Regulation
Biochemicals, Natural
Medicines, Pharmaceuticals
Freshwater
Source: MEA 2005

17. Democratic Republic of Congo

18. DRC Development Context
• Conflict and political strife
since the 1960s
– ≈ 5.4 M died in the 1990s
from conflict
• GDP: US$28 billion
– Agriculture (44 %)
– Industry (23 %)
– Services (33%)
• As of 2010, average per
capita GDP was US $300
– 75 percent on less than $1
per day
• Human Development Index:
186/187
• Life expectancy: 56.5 yrs
(2014)
• 400,000 women are subject
to sexual violence every
year

19. DRC Development Context
• DRC has vast natural resources including untapped deposits
of raw minerals
– May be worth over US$ 24 trillion (Paul Trustfall)
• Congo rainforest: 2nd largest in the world
• Congo River Basin
– 2nd largest flow and the 2nd largest watershed in the world
– One of the most biodiverse
• Over 60 species are threatened, vulnerable, or near extinct
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20. How should DRC use its resources to develop?
20

21. Harnessing the Congo River
http://www.redbull.com/cs/Satellite/en_INT/Video/Congo-The-Grand-Inga-Project-Exclusive-Extended-Trailer-021243249885655

22. 22

23. Inga 1, 2, 3 … Grand Inga
Dam Status Power
Potential
Location
Inga 1 Completed
1972
351 MW
(at 60%
capacity in
2013)
Diversion canal
downstream of
Grand Inga
diversion
Inga 2 Completed
1982
1,424 MW
(at 60%
capacity in
2013)
Inga 3-BC Proposed 4,800 MW Bundi Valley with
diversion
upstream of Inga
1 and 2 diversion
Grand Inga Long-term
potential
40,000 MW

25. What will the impacts of Inga 3 be?
• What can we learn from
the Three Gorges dam?
– Total installed capacity
22,500 MW
Three Gorges Dam (China): largest in the world

26. Economics
• Inga 3-BC estimated cost is U.S. $9.8 Billion
(2013 World Bank/IDA estimate)
– Common infrastructure
– Power station
– Line to mining zones in DRC
– Line to South Africa
• Estimate is preliminary: proposed World Bank
projects will result in comprehensive project
scoping
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27. Economics
• For Inga 3, a positive rate of return is contingent on:
– Cost of project
• Political instability
• Construction contingencies
– Revenue
• Negotiated $ per kWh rates
• Collections
– Operational costs
• Technical, managerial, and financial capacity is needed to keep costs
reasonable
• Regional benefits could be significant
– $1.1 billion saved per year in reduced energy costs for countries
in the region
– Possible 3 percent increase in DRC GDP from net exports from
Grand Inga
27

28. People

29. Public Health and Resettlement of
Project-Affected Peoples
• Estimated 12,000 plus people will need to
resettle for Grand Inga
• Public health assessments need to be conducted
to ensure that diet and quality of life is improved
• Negative economic and social impacts of the
project need to be mitigated
29

30. Environment – Endangered Species
• Four IUCN Red Listed mammal species have been identified
in the zone of influence including downstream
– Chimpanzee (endangered), hippopotamus (vulnerable), Bay
duiker (least concern); and sitatunga (least concern), manatee
(vulnerable)
• Lower Congo Rapids ecoregion has exceptional species
richness
– High endemism in fisheries (34 of 129 species are endemic,
26%)
– Current ecosystem structure (river flows) driving fish speciation
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31. Mountain Gorilla and Bonobo
Chimpanzee

32. Forest Elephant

33. Environment – Maintain
Environmental Flows
• Naturally variable flows are essential for
biodiversity and ecosystem services
– Maintaining a minimum low flow is insufficient
– Need to integrate seasonal variations
– Consequences include:
• Loss of river and coastal fisheries
• Accelerated erosion
• Sedimentation and productivity in Congo plume in Gulf of
Guinea
• Impact carbon sequestration from mangroves, river plume
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34. Long Term Impacts
• Changes to Water/Land Surface Area are Anticipated
– Grand Inga will raise the river level by 40m (~12 stories)
– Impact water levels 115 miles upstream
• Trans-boundary issues
• Require resettlement
• Change in downstream flow from Grand Inga will affect
flooding, habitat such as the mangroves, flora and
fauna in aquatic and terrestrial environs, the ocean
plume, and carbon sequestration
34

35. Should
DRC
develop
Inga 3?

36. Should DRC develop Inga 3?
• Consider
– Energy source options
– Sustainable
development
• Economy
• Society
• Environment
• Points of View
– President of DRC
– Minister of Environment
– Local peoples

37. 2/9/2015 37
Charles Hernick
Senior Associate, International Group
+1 703 247 6193
Charles.Hernick@CadmusGroup.com
@CharlesHernick