China Environment Agency Takes On Giant Dam Corporation

A state environmental agency succeeded in halting work on three new projects run by operators of the giant Three Gorges Dam, as part of a larger effort in China to rein in infrastructure ventures that fail to meet environmental standards.

It had been unclear whether the State Environmental Protection Administration could prevail over the government-owned enterprise that runs the world’s largest hydroelectric project. But observers say the results this week show the country is serious about cleaning up the environment.

“It’s definitely a small breakthrough,” said Zhou Xiaozheng, a sociologist at People’s University in Beijing. “Before, no one would have dared to stop them.”

However, the agency has limited options for enforcement.

The tussle started last month when the environmental agency suspended construction at 30 major projects that it said were ignoring new laws requiring environmental impact studies before work could begin.

Work was stopped on all but eight projects, including three being built by the China Yangtze Three Gorges Project Development Corp. One is the massive Xiluodu Dam on the Jinsha River, as the Yangtze is known in its upper stretches. The other two are auxiliary facilities: connected to the Three Gorges Dam: an underground power station and a power supply station.

Then today, state media reported that construction had stopped on all 30 projects, suspending what became a very public dispute.

The environmental agency posted information about the offenders and the applicable laws on its official website. The dispute was picked up by newspapers around the country. The Three Gorges enterprise told state media that it had complied with the necessary laws in building its power stations.

The corporation is no stranger to controversy. Its massive dam project, begun in 1993, involved the relocation of more than half a million people, and drew ire from environmental and human rights groups at home and abroad.

If the company did not stop construction at the three sites, it could have faced $24,000 in fines, a small amount for an enterprise whose projects run well into the billions.

“The penalty is insufficient to act as a deterrent,” said Wang Yahua, a specialist in water management at Qinghua University’s School of Public Policy and Management. “We definitely need to strengthen our enforcement capabilities.”

The order to halt construction comes as the country faces serious power shortages caused by a booming economy that grew 9.5% last year.

Balancing development and environmental protection has long been a challenge for Chinese policymakers. Large traditional coal-based power projects tend to be heavy polluters, and many were launched without proper approval, whereas hydroelectric projects involve flooding of farmland and forests and require population relocation. The major investors usually are local governments and powerful state conglomerates, which at times are willfully blind to environmental concerns.

The state environmental agency has won legal backing for its efforts only since the National Environmental Assessment Law went into effect in fall 2003. The current campaign to clean up polluting projects is an opportunity to flex its muscle and test its limits.

“It’s a step forward,” said Zhou, the sociologist. “At least they have put future projects on alert: There will be negative consequences if you don’t follow the environmental protection laws.”