Three Gorges Probe

New doubts over Chinese plant

Financial Times
June 6, 2006

Beijing–Demand for power from China’s controversial $24.5bn Three Gorges hydro-power project, the world’s largest civil engineering undertaking, may fall significantly short of supply, a former senior executive in the project has claimed. Yuan Guolin, who until two months ago was the deputy general manager of the China Yangtze River Three Gorges Project Development Corporation, said a review was needed on whether the project could sell all its output after it began generation in 2003. Environmentalists and human rights activists have already called the project into question, citing the potential disruption to the ecological balance of one of China’s most scenic and fertile areas. They say a huge reservoir that would be created by a vast dam across the Yangtze would displace more than a million people, flood vast areas of farmland and could cause extensive silting. Mr Yuan, a delegate to the Chinese People’s Political Consultative Conference in Beijing, said one potential problem was that authorities in the 10 provinces and municipalities supposed to be customers of the Three Gorges project were planning their own power stations – which would provide a ready source of tax revenue for the local authorities. A demand shortfall from 2003 would be especially damaging to the project because revenue from post-2003 production was supposed to finance the third phase construction of the project to last for 6 years from 2004.

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