Another damned dam.

After a decade-long break from financing large dams, the World Bank began supporting a controversial new hydropower project in Laos two years ago. Billed as a 'model' project, the Nam Theun 2 Dam was designed to incorporate recommendations from the World Commission on Dams, which released a definitive report on the environmental, economic and social effects of large dams in 2000. But now, reports the Worldwatch Institute, both the project's managers and advocates from the International Rivers Network (IRN) say Nam Theun 2 has fallen short of these goals.

The $1.25 billion project, backed by the Asian Development Bank as well as the World Bank, is halfway through its four-year development plan. Two-thirds of the 1,240 families that will be flooded out by the dam have been moved to a new village, but IRN has found that plans to provide for affected Laotians are unravelling. Implementation of a 'Livelihood and Asset Restoration Pilot Programme' has only been initiated in 21 villages--or less than 10 percent of the downstream villages that will be affected when operations begin in 2009. 'As a result, villagers are becoming guinea pigs in a vast and risky resettlement process,' IRN's study concludes.

IRN estimates that some 40 to 80 million people around the world have been displaced by dams, while millions more are affected by the loss of fisheries, decreased water quality and other downstream impacts. On a global scale, rotting vegetation in flooded reservoir areas may account for some four per cent of human-induced climate change.