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IFC's support for the Bujagali Falls Hydroelectric Power Plant involved the design and construction of a power plant at Bujagali Falls in Jinga province, Uganda to sell electricity to Uganda’s state owned Electricity Board. The project also included the construction of power transmission lines, associated substations and a reservoir. At its full supply level, the project’s reservoir would inundate 80 hectares of land and 308 hectares of area previously occupied by the Victoria Nile River. This inundation raised serious concern amongst local populations in relation to cultural and spiritual effects. In November 2000, the National Association of Professional Environmentalists lodged a complaint with CAO regarding the following issues:
The economic viability of the project and the cost to low-income consumers;
The advantages to be derived from the project for the people of Uganda;
Significant issues concerning guidelines of the World Commission on Dams and their pertinence to the Bujagali project.
Acres International was commissioned by the World Bank Group to undertake a comprehensive assessment and least-cost analysis of all practical alternatives for meeting Uganda’s future power requirements, which identified a hydroelectric plant at Bujagali as the least-cost option. Public consultations were held widely before and after the release of the Environmental Impact Assessment in April 2001. However, significant criticism resulted from the assessment in relation to the exhaustiveness of the consultation process with local communities. This project aroused serious interest by many stakeholders including industry, NGO, Government of Uganda (GOU), civil society and impacted persons.
Case Status: Closed
In the Assessment Report, completed in September 2001, CAO stressed its limitation to the issues raised and accepted in its Ombudsman role, however reiterated its awareness of the broader concerns that relate to the Bujagali Hydropower project. It was found that despite the project remaining in the pre-Board approval stage, it believed that IFC had been diligent in ensuring compliance with IFC Safeguard Policies. CAO noted a number of outstanding issues, amongst which were the lack of conclusive economic analysis of the project, the question of affordability of electricity to poorer sectors and the lack of a comprehensive management plan for the Nile raising long term-management issues. Finally, CAO determined that it failed to see a role for facilitation or mediation at this stage given that IFC had not yet made a final decision concerning its participation. The complaint was closed in January 2005.
CAO case story page: http://www.cao-ombudsman.org/cases/case_detail.aspx?id=114