The government views the Nam Theun 2 hydropower project in Khammuan province as a successful model as it seeks to strengthen the country's electricity generation policy, according to Prime Minister Thongloun Sisoulith.
"I think that in the future, the government will refer to the success of the Nam Theun 2 power plant, as it is a good model. [The government] is now inspecting and evaluating [hydropower] projects to ensure that they are the best possible," he said, when meeting with World Bank officials last Friday.
The World Bank-backed Nam Theun 2 dam, which became operational in 2010, has an installed capacity of 1,070 MW and can generate 6,000 GWh a year, about 95 percent of which is sold to Thailand.
The US$1.3 billion hydropower project, which also received support from the Asian Development Bank (ADB) and other international organisations, is based on a multiple-purpose concept, which acknowledges the need to balance economic gain with environmental protection and rural community development.
In the meeting with World Bank officials, Prime Minister Thongloun said these important aspects of the project made the Nam Theun 2 a top quality and sustainable hydropower plant.
Mr Thongloun said the Nam Theun 2 hydro plant benefits Laos in multiple ways. On the one hand, it provides a significant amount of revenue to the Lao government while, on the other hand, it allocates a portion of its income to finance rural community development, protection of the environment and forests, biodiversity and watershed management, to ensure the sustainability of the project.
"The use of the revenue generated by the sale of electricity was discussed at the start of the project," Mr Thongloun told the meeting, adding that when the dam became operational, the expenditure plan was carried out in accordance with the project concession.
The prime minister said that another positive aspect of the plant was good water resource management, which does not only aim to supply water for electricity generation but also for agriculture.
When asked about the major achievements of the Nam Theun 2 project, Mr Thongloun said it was about turning challenges into opportunity, adding that the overcoming of obstacles made this dam the best in Laos and perhaps in the world. He said this achievement was possible thanks to the active coordination and close cooperation between the government and its development partners, including international financial institutions and the Nam Theun 2 Power Company. Extensive studies on the possible impacts of the project, and extensive debate on the project's design, development and operation also played a significant part in its success.
The shareholders in the project are Electricité de France (40 percent), Lao Holding State Enterprise (25 percent), and Electricity Generating Public Company Limited (35 percent).