In 2005, Sabah will have an accumulated installed capacity of 880 MW, while its *peak demand will only be 615MW. This means that by 2005 the state will have a **reserve margin of 43.1 percent. Sarawak in 2005 will have an accumulated installed capacity of 1046 MW with a peak demand of 839MW. This means that the state by 2005 will have a reserve margin of 24.7 percent. Altogether, both states will have an installed capacity of 1926 MW with a peak demand of 1454 MW, creating a reserve margin of 33 percent in 2005. This is a comfortable reserve margin.

Thus if Bakun is commissioned in 2006 and if we assume that the dam will be generating only 1,800 MW of electricity and not 2,400 MW as projected because hydroelectric dams do not usually succeed in producing electricity up to their target capacities and assuming that there are no plans for any other Independent Power Producers in both Sabah and Sarawak, the total accumulated capacity in East Malaysia by 2006 will be 3,726 MW.

If we allow for an 8 percent annual growth in peak demand between 2005 and 2006, the total peak demand for both Sarawak and Sabah in 2006 will only be around 1,570 MW, resulting in a reserve margin of 137 percent. If Bakun were to produce up to 2,400 MW, the reserve margin will actually be 175 percent.

Electricity once produced must be consumed immediately If a nation spends RM8 billion to develop a product only to find that it is not able to sell the creation, enormous losses that could potentially jeopardise its economy are inevitable.

The only way we can fully utilise the excess power in East Malaysia as a result of Bakun is through a mindless form of industrial growth that will also give the industries the upperhand in determining the price of the energy sold.

Sending the excess power to Peninsula as originally planned in the 1990s will be pointless, as by 2005, Peninsular Malaysia will also be having a comfortable reserve margin of 35.4 percent. Furthermore, installing the 650 km-submarine cables will only increase the cost of the project by more than 100 percent and the construction of such lengthy undersea links will be burdened by issues of their security, maintenance, high levels of transmission loss and other complex and unpredictable engineering problems.

If there is ever such an urgent need for a huge increase in energy supply by 2006, whether in Peninsular or East Malaysia, which is doubtful anyway, it is certainly cheaper, faster and safer to build a new gas-fired plant, a tried and tested technology.

*Peak demand is the maximum power demand registered by the system in a stated period of time.

**Reserve margin equals accumulated capacity minus peak demand, divided by peak demand and multiplied by 100.

Mindless and monopolised development does not eliminate poverty. To eliminate poverty, a community must be empowered and be given access to natural resources and the means of economic production. Land is one such resource. In addition, the poor must also be left to make decisions on the development paths that they wish to take.

80 percent of the land where the Bakun Hydroelectric Project stands on belongs to 10,000 indigenous persons who had access to electricity, water, schools and clinics. Their farms, rivers and forests gave them food and a decent source of income.

However, Federal planners who assume they know better and choose to deny the participation of communities in the decision-making process of their development plans are bound to doom the concerned people. This was what that happened to the Bakun affected families.

Today the once self-sufficient community is facing hardship of unprecedented magnitude in their new homes in Sungai Asap.

The non-transparent resettlement process has created new poverty among the people because it deliberately pushed them into a cash economy with scarce job opportunities, inadequate and sometimes infertile and inaccessible farming land, little access to forest and river resources, no cheap modes of land transport and a debt of RM52,000 for their shoddy and small new houses. In fact, Sungai Asap does not even have a secondary school.

There are many issues that we need to question here.

Firstly, there is a very high probability that foreign investors are not going to be interested in financing the project given the fact that it is obviously lacking in economic viability. In the 1990s, foreign investors literally turned their back away from the dam resulting in the Sarawak State Government, Tenaga Nasional Berhad, Sarawak Electricity Supply Corporation and the Employees' Provident Fund, among others, having to fill in the equity of the Bakun Hydroelectric Corporation Berhad (BHC) - the company in charge of the operation of the project and in the process risking money which was not at all privately sourced out.

In the end due to the economic downturn, the Ministry of Finance had to take over the project and the Federal Government had to fork out a total of RM950 million to compensate the parties involved for works already done at the dam site.

Bearing this in mind, will the attempt to entirely raise RM8 billion worth of money from the domestic market not cause a strain on our economy? Can the project yield a sufficiently large flow of funds within a short period of time? With our falling reserves, will the market take Bakun lightly? (According to Bank Negara, as of Feb 2001, we only have RM89 billion in total reserves.) With liquidity on a declining trend, domestic reserves alone may not be sufficient to absorb the proposed issues of bonds. Most importantly who will have the money to purchase the bonds?

Secondly, the country is certainly going to face adverse economic impacts if the project faces financial obstacles in the midst of its construction again. The fact that the dam has been already been shelved twice shows that Bakun cannot withstand the assault of an economic hiccup. In 1985, the crash in commodity prices smothered it within a year and amid our arrogance of newfound wealth in 1997, the currency depreciation shot it down within months.

Cost performance data in the World Commission on Dams' (WCD) Knowledge Base suggest that the average cost overrun of the 81 large dam projects included in its Cross-Check Survey was 56 percent. Even the medium sized Pak Mun Hydroelectric Dam in Thailand was saddled with a 68 per-cent cost overrun. Are we strong enough to absorb such unfortunate occurrences?

Thirdly, will the return of the project be good enough to compensate for the cost of raising the required capital? What if Bakun is slapped with huge technical problems after its completion, resulting in the dam generating an amount of power below its projected capacity?

One-fifth of the projects in the WCD sample achieve less than 75 percent of the planned power targets. Energy output of hydropower is often lower than initially estimated. Normal variations in weather, river flows and siltation dictate that virtually all hydroelectric projects will have year-to-year fluctuations in output. Eleven of India's largest reservoirs were filling with sediment 130 to 1,650 percent faster than expected - indeed, erosion can be very severe in the tropics.

Fourthly, as we have already argued above, there is no immediate demand for such an enormous increase in power supply in Malaysia. Thus if Bakun is commissioned, we are indeed going to face a lose-lose situation - if growth in power demand in the near future in East Malaysia fails to produce a consumption pattern that is able to utilise electricity from the dam at a maximum level, Bakun will certainly suffer huge losses. However, if we somehow, miraculously, are able to find enough industrial investors to fully consume electricity from Bakun, such a super rapid growth is unlikely to be sustainable and may create adverse environmental and social impacts that may also cost us dearly in the long run.

Finally, it is also unlikely that we are able to export excess power from Bakun to our neighbouring countries. Both Kalimantan and Brunei are well-known energy-rich zones.

Thus with all these statistics flying around, it is reasonable to believe that Bakun has a high potential to incur huge losses that may not be able to offset its oft-touted future benefits. Who will then bear these losses? Certainly it is not prudent nor ethical for a government to go ahead with such a risky and huge project that gambles a nation's economic stability.

Gross emissions of greenhouse gases (GHG) from reservoirs due to rotting vegetation and carbon inflows from the catchment areas may account for between 1 percent and 28 percent of the increase in global warming. All reservoirs emit GHGs and in some circumstances the gross emissions can possibly be even greater than the thermal alternatives.

In addition, dams also affect the river's downstream aquatic ecosystem and biodiversity. It is well-known that all over the world the modified habitats created by a dammed river, often create environments that are more conducive to non-native and exotic plant, fish, snail, insect, and animal species that can outcompete the native species. The ecosystem then may turn unstable, nurture disease vectors, or lose its ability to support the historical environmental and social components of the river.

Dams also reduce the downstream flow of water, sediment and nutrient replenishment to coastal deltas causing them to lose their fertility, affecting the natural productivity of riparian areas, floodplains, mangroves and deltas and can even cause coastal erosion, bank collapse and saline intrusion of the water table. Water quality parameters recover only slowly when water is released from a dam and while oxygen levels may recover within a kilometre or two, temperature changes may still exist 100 km downstream.

In addition, Bakun will also flood 1.5 million ha of land, 75 percent of which is primary forest. More than a hundred protected species, along with various gene pools of native crops will also be lost.

Granted that coal and oil are not at all sources of clean, renewable energy but we do actually have a way out.

It is estimated that there are only around 1,000 billion barrels of oil and 800 billion barrels of gas left in the world today. With our present mode of consumption, at an annual growth rate of 1.25 percent globally, the present fossil fuel reserves can only last for another 47 years, roughly the shelf life of Bakun.

While the fossil fuel industry today is more interested to pursue these sources to the last drop rather than begin to heavily invest and mass market renewable energies, governmental actions do make a difference. In Denmark for instance, as early as 1980, its Government was already concerned enough to lay an energy plan that stipulates that by 2000, the country will generate 1,000 MW of electricity from wind. With proper implementation and unflinching commitment, by 2000, the country was already producing some 2,000 MW of wind energy. Today its wind energy industry is a global force to be reckoned with and its energy cost per unit of wind power is the same as for new coal-fired power stations fitted with smoke scrubbers - about 20 sen.

Thus, whether we like it or not, 50 years from now Malaysia will have to switch to solar, wind or biomass for power and even allow rural areas to rely on mini hydro dams. Renewable energy advocates have pointed out that now is the perfect time to begin investing and developing in renewable energy efforts. The transitional period must begin today, as even if we burn a quarter of the existing reserves of the world fossil fuel supply, severe climatic impacts will take place.

Thus, instead of investing in such a wasting and risky energy adventure, we should seize this moment to develop solar technology. This is the perfect chance to break away from the monopoly of international energy billionaires whom we often berate every time the price of oil escalates by drawing an energy policy that seeks to utilise solar energy through sound planning and implementation of incentives for the offsetting of GHG emissions and low levels of consumption. To argue that Bakun is going to help us when the last drop of oil has been burnt is truly absurd as the dam by then will likely have reached its expiry date.

Contrary to popular belief, solar technology is here today. The reason it has yet to reach the masses is simply because the fossil fuel industry refuses to mass-produce it. It has been estimated that just over RM2.5 billion (RM6 billion cheaper than Bakun) could kick-start a self-sustaining solar energy market in cold, sunshine deprived Europe. (It requires the installation of 1 million solar roofs or 2,000MW by 2010.) This would create 58,000 jobs and the cost spread across 10 years would equal the European Union's 15-month expenditure on fossil fuels.

The cost of solar photovoltaics has dropped 80 percent in the past two decades and another renewable technology - solar thermal systems, can already almost compete with conventional thermal in settings with high solar insolation levels.