The Lesotho Highlands Water Project 

By Sahoai Santho and Barbara Gemmill  

Lesotho has been called an “improbable” country: a small landlocked mountainous kingdom, it endures against a number of odds. Historically, the kingdom of its famous 19th century king, Moshoeshoe I, included the rugged mountain watershed, and the fertile fields of Orange Free State. When the British declared Lesotho their colony, they made a gift of the fertile fields to the Boers, thus beginning their rule with a violation of the ecosystem approach, that ecosystems should be managed within the limits of their functioning, with watersheds managed as a whole to the extent possible. When Britain relinquished its colonies, it actually wanted to give Lesotho to South Africa, a decision that might have had some ecological sense but carried poor political logic. The protectorate could hardly be given to the apartheid government that had just carried out the Sharpesville massacre.     

Less than 10% of Lesotho’s land is arable, not enough to feed its population. While the objectives of conserving and benefiting from land, water and living resources are undoubtedly a matter of societal choice (Ecosystem approach lesson one), those choices are more often than not made by history as directed by the powerful.      

Lesotho has a human population of 2 million, increasing at a rate of 2.6% per annum. If current trends continue unabated, Lesotho’s human population will double in the year 2020.  Besides a growing human population, what Lesotho does have in abundance, however, is water, and grazing land.  The green gold of grasslands might be the topic of another case study (Cows as Conservationists?), but the “white gold” of Lesotho’s water has preoccupied development and environment issues in Lesotho for the last twenty years, dominated by the Lesotho Highlands Water Project (LHWP). This ambitious project was actually conceived in colonial times, to divert the abundant mountain river water of Lesotho from a natural southwesterly flow out of the Lesotho Highlands and direct it north towards the industrial interior of South Africa, through a series of dams and tunnels blasted through the mountain.     

The project has reaped all manner of distinctions, such as the “largest infrastructure construction project ever on the continent of Africa”, and “the dam second in size in Africa only to Ghana’s Volta Dam”, and “among the most ambitious multi-purpose water schemes in the world.” The scale of the project is truly immense: it involves the construction of up to five dams in Lesotho’s Maluti Highlands over 30 years, due for completion in 2020. The scheme will divert about 40% of the water in the Senqunyane river basin, via a complex series of tunnels, to South Africa’s Ash river and from there into the Vaal dam 70 kilometers south of Johannesburg. Official estimates put the total project cost at $8 billion, but possibly more from unforeseen problems. Ecological and social problems of diverting such quantities of water in a fragile mountainous environment, where until recently the only sustainable livelihood was herding of livestock along rugged slopes, are equally immense.    

When the project was conceived, local people had little choice but to accept what was handed down to them from the top: the political environment within Lesotho was repressive and dictatorial. NGOs in Lesotho, South Africa and the West campaigned against the project, but to no avail.      

But in 1993, democratization came to Lesotho, and in 1994, apartheid ended in South Africa. With new and more liberal political parties leading each government, NGOs re-linked with the project. Realizing that their views would not fall on such deaf ears as before, they asked themselves, “what should be the position of NGOs on this project, (which by that time was already well underway) from both an environmental and a human rights stance? A dialogue began between NGOs and government, at first painfully. The LHWP was, at the time, way ahead of its bench marks in terms of engineering, and totally behind in terms of social and environmental considerations.      

The  project has been undertaken in two phases, poetically named “Phase IA” and Phase IB”- terms that now define vast regions of Lesotho in the popular mind, as the entire population has been affected in one way or another by this massive project. By the time of completion of Phase IA, the project was winning international prizes for its technical achievements, yet this “engineer’s dream” was a villager’s nightmare. No environmental impact assessment had been completed, and the rights and needs of local populations and a fragile mountain ecology had not been considered. The Lesotho Council of NGOs worked initially through their international partners, the International Rivers Network and Environmental Defense Fund to prevail upon the World Bank to reform these objectionable practices, which in turn prevailed on the project implementers. The outcome: a comprehensive environmental impact assessment was undertaken for Phase IB, with international and local contributions and guidance and funding from UNESCO.     

Out of this EIA has come an Environmental Action Plan, accessible to civil society, which communities and NGOs can track and demand that the project fulfills. A new civil society organisation has been formed, called the “Cluster of Concerned NGOs on the Highland Project”, who have ultimately decided to change their relationship with the project from confrontation to constructive dialogue.  Recognizing that government and NGOs are rarely going to be in agreement, they have set in place a deliberate conflict management framework to deal with disagreements and define areas of constructive collaboration. A memorandum of understanding has now been signed between the two bodies, empowering the Cluster of Concerned NGOs on the Highland Project to undertake two main activities, monitoring and evaluation, and delivery of specific services.    

One of the leaders of the NGO community has pointed out that support from international advocacy NGOs has been instrumental in pressurizing the World Bank to incorporate civil society input; however, their strident opposition to large infrastructure projects like the Highlands Water Project was not, in the end, the same position that local NGOs have taken. Local NGOs must deal with the reality that the first dam was in place before their viewpoints even began to be considered. They also feel a need to more carefully balance pressing needs for development with environmental concerns. In this respect, what has evolved within Lesotho is very similar to the conclusions of the World Commission on Dams, operating on the global level: a multi-stakeholder body, made up of groups with highly different views, but actively seeking consensus and ways of proceedings such that each side sees the realization of their objectives.    

The Highland Project as it now stands, fulfills quite well the ecosystem approach guideline to “understand the ecosystem in an economic context”. While the watershed value of many other mountain ecosystems is undervalued and under appreciated, Lesotho has positioned itself to be reimbursed by populations downstream (in Orange Free State) for the provision of watershed services. As it currently stands, South Africa is paying about $US 2 million per year for water from Lesotho - $1 per year for every citizen of Lesotho. The production of this “white gold” fortunately does not require Basutu men to trek off to the mines of South Africa, but it does require attention to the ecosystem that produces it. These revenue streams, flowing uphill, should encourage the highland communities to protect and steward their watershed, a good incentive for responsible land management.    

But the Lesotho Highlands Water Project now faces a critical juncture. A number of issues involving equity and sustainable development remain to be worked out through this dialogue process, and the political process in general.      

One of these is achieving parity between global benefits and local gains. The LHWP has had an undeniably profound impact on Lesotho’s economy. In 1998 it accounted for 13.6% of Lesotho’s GDP. Royalties from the sale of water and project-related customs dues make up 27.8% of all government revenue, but the country’s poor have benefited little from this economic boom. Lesotho still has one of the top ten greatest income disparities in the world. The Lesotho Highlands Water Revenue Fund (LHWRF) is intended to distribute the project’s royalties to the nation’s poorest. But scandal and corruption have already rocked the fund’s administration.    

One of the keys to sustainable development is to develop a resource just to the peak point of its demand, and not to “flood” the market, if the pun can be excused.  It is quite possible that Lesotho should have stopped while it was ahead with water impoundments; the continuation of the LHWP may not be necessary to meet South Africa’s water needs. Residents of Johannesburg’s townships, the final consumers of LHWP water, collect water from apartheid-era systems that waste up to 50 percent of water piped to them. When the project’s second dam was being considered, Gauteng’s water utility, Rand Water, suggested that the project could be delayed as much as 17-20 years if system efficiency was increased through better demand-side management (DSM). But the machinations of the World Bank are complex, and respect the laws of entropy (anything started is hard to stop, anything stopped is hard to start) more than real economics. The Bank decided to continue with the project without a thorough analysis of DSM or the possibility for a delay, arguing that the need for greater supply was inevitable, and that a delay would drive up construction costs.     

The second dam, called Mohale, is now underway.  Critics fear that moving forward with the dam before the water is needed will stall demand-management projects, and needlessly increase the cost of water at a time when the South African government is undertaking the expensive venture of improving water service to millions of people in the townships.    

Water is one product of the project, but power is another. The project has already dispossessed 20,000 rural farmers of their assets (ranging from fields to grazing lands) and previous livelihoods. In an effort to prevent the permanent impoverishment of these people, the governments of South Africa and Lesotho promised in the LHWP Treaty that affected people “will be enabled to maintain a standard of living not inferior to that obtaining at the time of first disturbance”. To the parastatal building the dam, with a strong vested interest and single minded focus in believing that a superior standard of living relates to being connected to a power grid, this promise was planned to be fulfilled by providing electricity to 10 remote villages located near the dams, within six years. Consultants budgeted $1 million to complete the project, yet now, a decade later, none of the homes of project-affected people have been electrified, and it is unlikely that they will be anytime soon.      

Power alone is a useless development tool, as this example showed: the assumption had been made by the parastatal that all they would need to do would be to bring the grid near the remote villages, and a groundswell of demand would pay for the rest. Ignoring the fact that the average monthly income for households in the project areas was approximately $65, while the average monthly income of Lesotho Electricity Corporation (LEC) customers at the time is over $400, the Lesotho Highland Development Authority proceeded to implement their plan in the village of Ha Kennan on the banks of Katse Reservoir. As the International Rivers Network reports:     

“At great cost, project workers erected utility poles and strung transmission lines over rough terrain to a transformer on the outskirts of the village. That is where the project ended. LHDA officials told the village residents that they must now “take the initiative” and ask the LEC to connect them to the transformer. They told the village that each participating household would bear the costs of new appliances, the connecting fee, and an additional $US 2,000 for utility poles. Not surprisingly, the transformer stands unused amidst a sparse collection of thatched, mud and stone huts while villagers continue to gather brushwood and dung to fuel their fires.”    

The Lesotho Highlands Water Project stands as a clear testament to the conclusions of the highly-lauded World Commission on Dams report, just launched by Nelson Mandela in mid-November: 

“Dams have made an important and significant contribution to human development, and the benefits derived from them have been considerable. In too many cases an unacceptable and often unnecessary price has been paid to secure those benefits, especially in social and environmental terms, by people displaced, by communities downstream, by taxpayers and by the natural environment. 

Lack of equity in the distribution of benefits has called into question the value of many dams in meeting water and energy development needs when compared with the alternatives. By bringing to the table all those whose rights are involved and who bear the risks associated with different options for water and energy resources development, the conditions for a positive resolution of competing interests and conflicts are created.” 

Indeed.  And if these lessons could not be learned on the first attempt, and have only entered the curriculum on the second attempt, let us hope that all players will be welcome at the table as Lesotho gathers to discuss phase three.  All the more so, because the environmental stakes ratchet higher and higher, and become more fraught with fatal flaws, with the number of dams on a river system.  A recently-completed the Instream Flow Requirements (IFR) study, intended to inform decisions on commencing the third dam in the system, suggests that if development continues as planned, Lesotho’s rivers could deteriorate to “something akin to waste-water drains” if Lesotho delivers as much water to South Africa as the original treaty requires. The well-respected study attempted to predict the long-term impacts of reduced river flows caused by the construction of the Katse, Mohale, Matsoku, and Mashai dams, and to recommend measures to compensate for and mitigate against these impacts. As the report makes clear, compensation and mitigation will be a truly formidable task. If Lesotho agrees to fulfill all the commitments made in its treaty with South Africa, it will result in a 96 percent reduction in river flow below Katse Dam and a 57 percent reduction where the Senqu River flows out of Lesotho. This translates into “critically severe” biophysical and social impacts that will cost between US$ 2.8-$4.2 million annually to address.     

It is not clear that any sum of money could ever really compensate for such drastic changes.  Dams tamper with a river’s complicated changes between low flow and flood as well as its delicate chemical composition. The report predicts “dense algal growths throughout the system, which can be toxic to fish; encroachment of exotic plants (at the expense of native plants—and the species that depend on them); moderate to critically severe increases of blackfly and other pest populations that prey on livestock; reductions in most fish populations, with some species like the Maloti minnow and trout reaching the point of extinction; declines in waterfowl, and an explosion in rodent populations, which could affect crops along the riverbanks.”    

The report went further, to envision other subtle but severe social impacts. From a natural ecosystem standpoint, it is already regrettable that they predict that many fish and wild vegetable species will be reduced by more than half. On top of this, social studies have shown that when species decrease to this extent, communities living near the river no longer make the effort to harvest them, as it is often a long, steep hike into and out of the river valley. Therefore, a 50% reduction effectively translates into a 100% loss of these resources to riparian villages - a serious situation given the already low nutrition levels in these communities. The low flows will also increase levels of pollutants in the river, causing critically severe increases of diarrheal diseases like giardia. Skin and eye diseases are also expected to increase sharply, the authors state. While the costs of increased health care for these disorders can be calculated, all the intermediary costs of communities turning from thriving ecosystems to dependencies on medical clinics can never be quantified.      

Both Lesotho and South Africa are now caught between a rock and a hard place:. If Lesotho decides to adhere strictly to the terms of the Treaty, build Mashai Dam and deliver 50.8 cubic meters/second to South Africa, South Africa will then be obliged to pony up the mounting compensation costs.  If Lesotho decides to allow more water to flow downstream through its dams, less water will be available to sell, again reducing the odds that the project will be cost effective.   This begs the question: how can adaptive management be built into such projects, to rethink the process all along the way, and to be free to call a halt when such a move is needed, instead of the relentless forward march of agreements that were signed when less was known?    

If ever there is a moment for the voice of civil society to be heard at the table, this is it.  As the World Commission on Dams report concludes: 

“Negotiating outcomes will greatly improve the development effectiveness of water and energy projects by eliminating unfavourable projects at an early stage, and by offering as a choice only those options that key stakeholders agree represent the best ones to meet the needs in question.” 

The ultimate lesson of the Lesotho Highlands Water Project is one of the tenets of the Ecosystem Approach:  “Ecosystem managers should consider the effects of their activities on adjacent and other ecosystems.” Lesotho, as a small mountainous country, is not quite a full ecosystem What it does have, in abundance, is a water catchment area, water, and now power.  South Africa, on the other hand, has the arable land and capacity for food production, and the need for the energy and water.  If both can come to mutually beneficial agreements on the sharing of these resources, both so rare on one side and so abundant on the other, much will have been accomplished toward sustainable development. 

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