Authorities in the Central Highland province of Lam Dong have withdrawn the licences of 15 delayed hydropower projects, according to Hoang Anh Tuan, a traffic and hydropower specialist from the Lam Dong People’s Committee.

“The withdrawal was due to delays in constructions of these projects, which had an impact on the province’s investment environment and on people’s lives,” said Tuan.

He said another 15 projects, including the Dasiat, Bao Loc, Darang-Dachamo and Mang Linh plants, that had began construction work but were still lagging behind schedule were also raising concerns.

Pham Thanh Loan, an expert from the province’s Industry and Commerce Department said projects that were delayed by two years or more would have their licences withdrawns.

Loan said a lack of finance for the projects and inexperienced investors were the main reasons for the delays.

“The contractors of these project are mostly private enterprises with small amounts of capital,” said Loan. “Therefore, they didn’t have enough of their own capital to even cover 30 percent of the total investment needed for the hydropower project.”

Loan said the investors’ weak financial capacity made it difficult for them to secure loans from banks.

“It sometimes took a year for investors to get a loan from a bank,” Loan said.

Even larger groups such as the Rubber Corporation and Coal and Minerals Corporation had difficulties in this area, said Loan.

Loan said investors usually had to invest 20 billion VND ( 1.1 million USD) per IMW of production capacity. Current inflation has pushed this rate up to 27 VND to 28 billion (1.5 million to 1.6 million USD) per IMW.

Private contractors that were able to draft plans and carry out construction helped to lower the required investment to 18 billion VND (1 million USD).

Loan said problems with site clearance also slowed down hydropower projects.

Some local people have blocked progress on clearance by building illegal houses for which they want compensation, which is as high as 300 million VND (17,000 USD) per ha.

A representative from the Darang-Dachamo Hydropower Management Board said the main reason for the plant’s delay was site clearance.

‘Up to now we have cleared away only 60 percent of the ground for construction even though we started the project in 2006,” he said./.