The Impacts of Hydropower Projects in Ethiopia: The Case of Finchaa-Amarti-Nashe (FAN) Project in Horo Guduru, Western Ethiopia

1. Abstract

More often than not, there are many hydropower plants under construction in Ethiopia for Hydro Electric Power generation and irrigation. Some of these are, Tekeze, Gilgel Gibe II & III, Tana Beles, Finchaa-Amarti-Nashe (FAN) Abay II[1], and the Millennium/ Renaissance Projects. These projects need to be studied regarding their general and specific impacts on the immediate people as well at national level. In Ethiopia, there is a negative history of dam induced displacement where by construction of dams ate planned top-down, relocate people against their will, lack of proper compensation and resettlement, no consultation and recognition of local people. Moreover, the development of hydropower is a heavily politicized issue in the Ethiopia.

This study is devoted to the impacts of Finchaa-Amarti-Nashe (here after as FAN) project in Horo Guduru, western Ethiopia. In order to accomplish this work, primary sources of data collection (interviews, focus group discussions, observation) and secondary sources like documents, books, and reports are used. This article identified significant points with regards to the project’s impacts on the lives of the people in Horo Guduru and that of the displaced ones in particular. Accordingly, FAN project has some value addition for peoples in the zone. However, the advantage of the project is by far less than what it costs the lives of the people. It displaced more than 10,000 people while compensation and resettlement are no yet made. Hence, the relocated people are victims of socio-economic and environmental hardships. Today, these people are encircled by the dam water not practicing any activity, departed from markets, their relatives and social interaction.

Key terms: compensation, desertification, development, irrigation, project, and resettlement.

As tried to be explained in the above diagram, any project is designed to bring all aspects of societal progress which is said to be development. Hence, development has a direct relation with it. Others are indirect to project. For instance, a project may not necessarily for irrigation rather it can be for hydroelectric power generation, flood control, water supply, etc. But, development and irrigation have direct relation as irrigation can promote certain aspects of development of the people. Desertification may not be as a result of a particular operation of a given project. However, if any project is not adequately planned and managed, it can lead to desertification in a sense that due to the project, environmental degradation can be the outcome of it.

The relation between displacement, compensation and resettlement on one hand and the project on the other is indirect. If a project causes displacement, then resettlement and compensation can be the result of the project. In other words compensation and resettlement are functions of displacement. But, a project may not cause displacement; hence indirect relation. In light of, FAN project caused displacement of more than 1,300 households; therefore, property compensation and resettlement patterns should critically be considered and studied. Thus, for this study, project and development are the functional terms from which social, economical, environmental and political aspects of the people around FAN project are examined and analyzed.

2. Introduction

As nature’s fundamental resource,” Water tends to attract attention: when there is too much of it, or too little” (Enhance, 1999:1). Especially, in developing countries, obtaining a safe and sufficient supply of water is daily necessity for vast number of people and an abiding ambition for their government. Sufficiency of supply is, moreover, a growing concern for as the size of population increases and also quickens the pace of industrialization in the developing world. Beyond for biological needs, huge quantities of fresh water are needed for agriculture, fisheries, mining, industrial production, generation of electricity, reverie navigation, maintenance of iconological assets and biodiversity, promotion of tourism and many other societal demands (Enhance, 1999:2).

Ethiopia is aware of the need to develop its water resources to feed its people and create a better standard of living. Naturally, the country is endowed with abundant rainfall and Rivers of a great potential for power and irrigation. Ethiopia is the main; source of the Nile waters; it is from which 86% of the Nile waters originates from. However, it is a country that has so far made the least use of the Nile waters because she was engaged in struggles to maintain its territorial integrity and political independence against colonial powers and expansionist foreign power. This meant Ethiopia had neither the time nor the resource to harness the Nile waters (EIIPD, 2000:3).

A clear embodiment of Ethiopia’s interest of exploring the possibility of using Nile water for its development traces to when Teferi Mekonnen sent a special envoy, Dr. Workineh Marten, to the US in 1927. Dr.Workeneh’s diplomatic mission was to discus and recruit American engineers for Lake Tana Development projects (EIIPD, 2000: 4). The Ethio-US cooperation led to the commencement of physical survey of the Blue Nile in 1930. In 1950s, Ethiopia also contracted a US engineering firm, Balton Hannessey and partners, to conduct a comprehensive study of the Blue Nile River. The survey conducted between 1957 –1962 and involved studies of stream flow, soils, hydroelectric energy, land use, marketing, communications, dams, and irrigation potentials which still constitute a fertile and lucrative are of action and cooperation (Ibid).

3. Background and Problem Statement

Energy is one of the most important factors for the development of a given society. It is common for a society wants to be transformed from agriculture to industrialization or to sustain its industrial development (Fryer, 1965: 340). This means the need to develop and maintain for socio-economic and environmental development is the concerns of both developing and developed nations (Bezuayehu, 2006). Developing nations are targeting for their energy consumption to the maximum that can at least feed their people by transforming their economy and society from highly agricultural to more advanced and modernized industrial sector (Dalton, 1971:350).

Ethiopia’s use of water for energy and irrigation traces back to the period after the 1950s which was a turning point (MoI, 1974: 4; Tibebe, 2000: 15). In this direction, two steps were taken in 1958: laying down of the foundation stone for Koka HEP plant, and signing of an Ethiopian-US agreement providing for American assistance to study selected River basins (MoI, 1974: 2). Accordingly, the Blue Nile Basin was selected by the government as the initial area for planning and then, the preliminary report of Blue Nile was completed in 1964 showing it as s source of tremendous hydroelectric and large irrigation possibilities (EIIPD, 2000: 4; MoI, 1974: 4–5).

3.1. The Finchaa Hydro-Electric Power Plant and Diversion of Amarti River

Following the Blue Nile investigation of 1964 and the preliminary report of 1968, the Imperial Regime planned and decided to construct dam on Finchaa River for HEP generation and irrigation in arid and semi-arid parts of Finchaa valley. On the occasion of laying of a cornerstone of the Finchaa Hydro-Electric Power Plant, Emperor Haile Silasse I had said;

Finchaa scheme was the first project to be implemented on the Blue Nile and its tributaries. It opened a new chapter in the development of the country, hence, it encourages the establishment of industries in the region and neighboring provinces and further for the country. Moreover, it generates more funds and vista for irrigation in the field of agriculture. (Finchaa HEP project, November, 1973: 2–3).

Finchaa hydropower dam was constructed in 1973 as a strategy for fostering economic growth in the country through generation of hydroelectricity, irrigation, fishing, and tourism (HARZA, 1965; 1975). Out of the 478 MW installed hydropower capacities generated in the country, this power plant generates 100MW. In 1982, the former EELPA commissioned a power system planning study (EEPCo, 2007: 2). This study identified the possibility of extending the generating potentials of the Finchaa plant. Accordingly, seven other sub-basins that could be diverted to Finchaa reservoir were studied. (EEPCo, 2010).

In light of this, in 1987 Amarti dam was constructed on Amartiii River that flows parallel to Finchaa River and enters to Blue Nile (Bezuayehu, 2006: 3). The purpose of this second dam is to divert water from Amarti reservoir to the Finchaa reservoir through a tunnel in order to raise the capacity of Finchaa hydroelectric power generation (OADB, 1996). With this, the storage capacity of Finchaa reservoir is estimated to be raised from 185 to 460 million m3 of water (Bezuayehu, 2006: 28). Currently, FHEP has an installed capacity of 128 MW and meets 27% of the national demand for power (EEPCo, 2007: 19). The other important benefits of the increased Finchaa reservoir are the enhanced possibilities for irrigation and fishing and the creation of an important wetland; increased water availability and has reduced the risk of flooding in to downstream areas and the hydro reservoir supplies water to a sugar factory downstream, creating new economic activities and attracting various birds to the area (Bezuayehu, 2006).

Despite these and other socio-economic benefits for national economy, the Finchaa hydroelectric power project has far reaching social, economic, cultural, environmental, and political side effects in the zone in general and for the people living in Finchaa watershed in particular (Assefa, 1994; OADB, 1996; Bezuayehu, 2006: 25–30). As studies indicate, the first impact of the Finchaa dam on the people in the watershed is related to the change of the land use in the area (Ibid). The land that is now submerged by the Finchaa, Chomman and Amarti Lakes was previously used for arable crops and grazing, sustaining the lives of many farmers and their families (Bezuayehu, 2006: 4). Studies also showed that the reservoir has inundated large areas of different land use types and evicted several people from their original places. Due to the construction of Finchaa dam project in 1973, more than 3,115 households making an estimate 22,250 peoples were relocated and displaced against their will (Bezuayehu, 2006: 11).

Before 1973, Finchaa watershed was known for surplus crop production, vast expanses of pasture and great herds of livestock (Ibid: 30). It is one of the potential areas of the zone in terms of agricultural productivity and natural resources (Office of Abay Chomman Woreda). Dechasa (2003) showed that the community in Finchaa watershed is nowadays confronted with a decline in crop and livestock production and even recently with famine. As a result of decline in agricultural productivity and environmental degradation in watershed, deforestation, loss of wild animals and soil erosion are the immediate consequences of the dam (Assefa, 2002; OADB, 1996). Although Finchaa project created new economic activities and provides Sugar Factor Industry in the zone, it greatly affected the market demand, structure, and supply of the zone and most importantly, social disturbances, cultural and economic deteriorations of the peoples in the Finchaa watershed.

The construction of Amarti dam in 1987 and its diversion to Finchaa reservoir also accelerated advantages to the national economy and disadvantages to the peoples of the zone (OADB, 1996). The increase in the size of displaced people from their original land and the absence of proper compensation for them as well as the loss of natural resources like forest and wild animals, and temperature change are things that due to the expansion of Finchaa hydroelectric power plant and increase in the size of Finchaa reservoir and an independent creation of Amarti dam (Bezuayehu, 2006).

Generally, the Finchaa and Amarti dams play a significant role in supporting the national economy through electrification, supplying water for sugar factory in downstream and introducing fisheries in the area. On the other hand; however, the local peoples were not compensated properly, and the benefits of electric power and sugar factory are not also for the zone as would be expected. Lastly, the environmental degradation as a result of interrelated factors necessitated by the project is the negative impacts (Bezuayehu, 2006).

3.2. Finchaa-Amarti-Nashe (FAN) Project

The plan to utilize Nashe River and other future neighboring catchments are the result of the preliminary report done in 1968 on the potential of Blue Nile which necessitated the commencement of Finchaa HEPP in 1973 and diversion of Amarti to it. The need to meet economic demands of the country and one of the way through which socio-economic and political developments of the country are realized is the generation of HEP and irrigation schemes from abundant water resources (Bezuayehu, 2006). This project is the continuation of this plan though it is resulted the creation of new hydroelectric power for more and sustainable economic benefits to the country (EEPCo, 2007; 2010).

According to the study done by EEPCo, the main advantage of developing additional power from the combination of Finchaa-Amarti-Nashe catchments is to increase the existing power infrastructure at Finchaa. Most importantly, the huge reservoirs of Finchaa-Chomman and Amarti at present are not utilizing optimum; and the central position is expanding ICS, with transmission lines going to the east (Addis Ababa), to north to Bahir Dar with extensions to Gonder etc, and to new extensions to Nekemte in the west (EEPCo, 2007).

The objective of the study done by the EEPCo is to recommend the optimum utilization of the potential of the Finchaa-Amarti-Nashe project on Nashe River for generation of power and energy. The short term objective is to identify and conclude alternatives for immediate implementation for additional power production to meet the expanding energy and power demand of the country. The long term objective is to identify the water resources of the country for development giving priority for multipurpose projects (EEPCo, 2007: 4). Accordingly, the study came up with three recommendations regarding how to generate hydropower. The first recommendation was to establish a new hydropower station. The second was extending the existing FHEPP by constructing dam on Nashe River and diverting the flow to Amarti and Finchaa reservoirs. Then, the extended power plant could reach on installed capacity of 160–200MW. The third alternative was constructing dam and small reservoir at Nashe River which is big enough for directing the normal flow to Amarti by pumping the optimization of the pumping plant and storage which requires 4–8MW installed capacity.

However, the second feasibility study of FAN project conducted by EEPCo in 2008 came up with the tremendous economic benefit of constructing new Nashe HEPP at elevation of 15–1600m above sea level. Then, EEPCO decided to construct Nashe dam to provide for new Nashe HEPP despite poor infrastructure at Nashe. This requires the construction of a major dam on Nashe River and the diversion of Amarti reservoir to Nashe reservoir. The reason for considering for diversion to Nashe instead of Finchaa is the possibility of utilizing higher head in Nashe and to reduce the plant factor and operational limitations at Finchaa (EEPCo, 2007: 5). The dam at Nashe River is in the range of 50m high and more than 1km long and the Nashe and Amarti reservoirs are at the same level. The optimum solution of utilizing the possibilities of creating a reservoir at Nashe is a major part of this feasibility study.

However, regarding the new FAN project, the government is justifying it as for the purpose of national economic development through hydroelectric power generation and irrigation scheme in lower parts of Finchaa valley so as to realize the Growth and Transformation Plan. But, the view of the local people is different, hence; they blame the project for its far reaching social, economic and environmental side effects on their lives. Preoccupied by the loses due to Finchaa and Amarti projects on people in Finchaa and Amarti watersheds, peoples in Nashe watershed assume the project as a the continued curse due to water projects in Horo Guduru. These people say, “The benefits that the project contributes to regional and /or national economy are at the expense of their lives”(Taken from Focus Group Discussions, 2011).

4. Methodology: Data Sources and Analysis

Empirical data are central to the study. Hence, primary sources of data collection like interviews, observation and focus group discussions were used. To this end, the researcher has done field work in the project site. Secondary sources are also consulted and review of relevant literatures including books, journals, reports, researched papers and documents are used. The research methodology is explanatory/ descriptive and the analysis is qualitative approach because the purpose of the study is to collect basic and relevant information regarding the viability and sustainability of the project on one hand and its socio-economic, political and environmental impacts on the people of Horo Guduru.

5. The Study Area

Horo Guduru is located in Oromia, western Ethiopia. It has a total of ten districts, one hundred seventy three peasant associations, and sixteen towns. It is bounded in the north by Abbay River which separates Wollega from Gojjam; in the east by Gudar River which separates Shoa from Wollega, and in the south by Anger River which separates it from East Wollega (Dereje, 2000:1). According to data obtained from the zonal office it is one of the youngest zonal administrations of the Oromia Region and is separated from Eastern Wollega Zone on June 17, 2006 and began to independently administer itself. In terms of social structure, the zone is mainly inhabited by indigenous Maccaa Oromoo nation; and there are also other social groups like the Amharas, Tigres and other peoples of SNNP.

Data obtained from the zone profile has indicated that the zone is inhabited by 717,312 population size on the total land of 712,166.22 hectares from which 11.7% resides in urban centers while the rest 88.3% lives in rural areas. This means the largest proportions of people within the zone lives in rural area and the major economic activity is agricultural activity. The zone is known in agricultural products such as wheat, maize, barely, sorghum, sesame, coffee, niger seed and livestock. The area around which FAN project and Nashe dam (Nashe watershed) are constructed and operating has high potential of agricultural activity.

Horo Guduru is one of the wettest zones of Oromia. It has a long rainy season which starts in spring and continues to autumn. The amount of rain-fall of the zone is dependent on altitude and the aspect of land in relation to rain bearing winds. According to data obtained from zonal profile, the climate of rural areas of the zone is divided in to temperate (34.78%); sub-tropical (35.46%), and tropical (29.78%). This shows that the dominant climate of the zone is sub-tropical followed by temperate, and tropical. These climatic types are the best for the production of different weather crops. The presence of huge water potential as a result of long rainy season and higher altitude has given the zone great advantage to produce different types of crops and hence to increase food security of the zone (Zonal Profile, 2008).

6. The Impacts of Finchaa-Amarti-Nashe (FAN) Development Project

Globally many water reservoirs have been constructed to provide electricity, irrigation, flood control, and water supply for the ever-increasing population and to improve its standard of living (WCD, 2000). To sustain economic, socio-cultural and political developments, water projects are getting attention across the world (Rooder, 1994). Currently, they are becoming, in some countries, the major source of economic, social, and political advancements. Particularly in the newly developing nations, water projects are on the verge of overtaking others ways of socio-economic progress. For instance, Egypt relies entirely on its water projects for survival (Mason, 2003). Ethiopia, as a newly emerging state in terms of its economy is making a great effort to utilize its water resources in order to feed its people and transform the economy to industrial sector since the 1950s (MoI, 1974; EEPCo, 2007& 2010; Bezuayehu, 2006).

However, manmade dams for hydropower generation and irrigation often show negative effects that can be social, economic, political and environmental (Dixon et al., 1989). Hence, in Ethiopia the commencement of both single and multipurpose water projects is increasing there is also a considerable emergence of major socio-economic, and political as well as environmental impacts in their respective watersheds and regions in particular, and national wide in general. Accordingly, on one hand, FAN project is constructed for hydropower and irrigation to develop the national economy. On the other, it has also negative impacts on the people in Horo Guduru. Therefore, this article discusses the social, economic, political and environmental impacts of the project in the given area.

6.1. Social Impacts of the project

Social impacts of water projects might be positive and /or negative depending on the manner by which the project is constructed, the degree of local peoples’ participation in and support for the project (WCD. 2000). According to some of my informants, rural people are beneficiaries of the project in terms of provision of social infrastructures (Dadi, 2011)[2]. They got access to electricity, road, hospitals/clinics, schools, pure water supply, etc. etc. New development and technology cause new social orientations like new ways of life, thinking and psychological make ups in rural and urban areas as well. For instance, rural people and urban dwellers are increasingly using modern social communications and interactions (Kajela, 2011)[3].

Urbanization is another outcome of the project which makes possible for the emergence of new settlements and increase in size of the existing small and big towns in Horo and Abay Chomman woredas. This is due to rural — urban migration following the displacement patterns, provision of and hopes for electricity and fear of invasion from Nashe water dam (either farming land or residential areas or both). Moreover, the creation of new towns and rural kebeles after the commencement of the project is visible fact. For instance, Nashe town is created near to the project which is inhabited by workers of the project and immediate communities. Therefore, rural electrification, communication and transportation services, new ways of social life, thinking and the expansion of rural kebeles, small towns and creation of new ones are the strong sides of the project in as far as the positive social impacts are considered.

However, dams cause displacement of people disruption of their social lifestyles, weakening of cultural ties and continuities, impact of relocation on the population inhabiting new host areas and widening gender gaps related to disproportionate sharing of social costs and project benefits which has a direct and indirect consequence on social aspects of the people (Bezuayehu, 2006). Lack of participation in the resettlement process causes dissatisfaction in resettlements and, hence; affects the sustainability of the project (Rooder, 1994, WCD, 2000).

Ethiopia has a history of development-based resettlement program since 1970s. The incumbent regime is also included ‘voluntary’ resettlement programs in ADLI, known as the Road Map of Ethiopia (Hathaway, 2008:5). However, these historic programs did not fulfill their objectives and failed to improve or even restore the quality of life for most displaced households. Resettlement for large dams has not improved where the government is not yet addressing the problems caused by resettlement (Ibid).

Local communities were not adequately consulted as outlined in Chapter 10, Article 92 of the Ethiopian Constitution which states, “People have the right to full consultation and to the expression of their views in the planning and implementation of environmental policies and projects that affect them directly.”(See FDRE Constitution). Such an inadequate process limits the ability of affected people to influence the resettlement and compensation process, and increases the chances that such processes negatively affecting them.

The major negative impact of the FAN project is related to the displacement of the local people in Nashe watershed. It has displaced more than 1300 households which approximately (averagely eight family per house) makes 10,000 people (Dugabas, 2011)[4]. Originally, these people have their own socio-cultural practices and beliefs, though in the same region, which might be lost during resettlement especially in urban areas as they adapt to different religion, language and ways of lifestyles (Bado, 2011)[5]. Hence, there is high probability of socio-cultural decline. Nashe reservoir allows the establishment of malaria and bilharzias vectors as well as cold related diseases which have a devastating effect on the of local communities.

The Nashe dam water has also stopped social communications and interactions between communities of Alshaayyaa Igguu, Alshaayyaa Daaddoo, Ejersa Maccaa, Hoomaa Kulkulaa and Sandaaboo Dongoroo (Bareda, 2011)[6]. Before the creation of the dam, these communities have intensive interactions because they share common markets and social organizations like idirs, ikubs and mahibers. But, today, due to lack of water transportation on Nashe water dam these people are unable to go to markets frequently and previous social ties were stopped. The other point related to lack of modern water transportation is the disruption of educational system in Nashe watershed and upper parts of the region (Ararsa Deso, 2011)[7]. Students from remote areas crossing the water dam are unable to follow their in education in schools like Daaddoo Siree Budoo (1–10 grades), Wandoo (1–8 grades), Gabaa Lagaa (1–8 grades), etc.

Therefore, the social problems as an outcome of the FAN project in the zone are the involuntary resettlement (displacement) of local people from their productive, favorable, and temperate original places to unfavorable areas like in Finchaa valley, steeper areas, etc and urban areas in the zone; disruption of their socio-cultural lifestyle; weakening of social interaction based on blood ship, religion, village to village relations, and the breaking of social associations like equb ,idir, mahiber etc. Cultural complications following rural-urban migration and the need to adapt to new people and environment are also the other aspects of social problems. The in viability of the relocation site for human and livestock lives may create health problems to these people and their livestock hence these people originally adapted to temperate climate. Additionally, social communications, education systems and access to markets for information and interaction are stopped due to Nashe dam. Hence, it should not be constructed before compensation and resettlement were made which was the major policy error.

6.2. Economic Impacts of the Project

The conventional approach of the evaluation of water development schemes relies on economic arguments (Bezuayehu, 2006: 104). Accordingly, dam development projects should be judged successful if they promote food security, contribute to poverty reduction and increase employment opportunities. The rationale to construct dam, therefore, is to foster the economy so as to enhance societal progress. Dessalegn (1999), however, argues that the greater weight should be given to social benefits as compared to economic benefits because the premises for which dams are constructed not always realized that might lead to further economic deterioration causing social difficulties. The project has an economic rationale for both local and national economies). According to the study of the project done by EEPCo, economic effects and benefits are the main justification of the project (EEPCo, 2007.

In addition to its social advantages, FAN project brings a greater economic importance for rural kebeles, small towns, and urban areas in Horo Guduru. The availability of energy for these areas increases the consumption of this energy for their daily activities (Korje, 2011)[8]. It makes easier and facilitates the use of electricity for electrical machines and instruments like refrigetor, garage works, saw mills, etc in the zone. Most importantly, the project encourages and accelerates the establishment of light and middle manufacturing industries if the local government and private investors do on the sector (Bareda, 2011). In addition, the new Nashe water dam creates and attracts new investment activities, tourism-smokeless industry and other economic activities (Juka, 2011)[9].

The work opportunity, both permanent and temporary, it created for local people in the zone is the other economic advantage of the project (EEPCo, 2010). Accordingly, more than 400 people have got work opportunity. Landless people tend to earn their lives from this project since 2008 in different ways. Amazingly, Youth educated and skilled by diplomas and current Bachelor graduates of 2010 and 2011 from Universities are engaging in daily labor force in the project. This is due to headache of unemployment and underemployment in Ethiopia (Shumete, 2011). Some informants also argue that the economic benefits that the displaced people will get in the relocation site and what they have been compensated financially are also the strength of the project (Hibirka, 2011[10], Beka, 2011[11]). They say, in the relocation site these people practice modern irrigation at least twice and/ or more per year. Previously, their production was all most agricultural production which is more time, energy and land consuming than commercial practices. However, in the relocation site, they produce both agricultural and commercial products for food self-sufficiency and exportation.

Moreover, FAN project has value addition for national economy. It generates 97MW which is timely response to what the national economy demands to be transformed from agriculture to industry- the motto of the incumbent regime. In addition, it irrigates dry lands in Finchaa Valley on more than 5,200 hectares. The power form Nashee Hydro-Electric Power Plant generates internal and external currency from domestic use of electric provisions and exporting to neighboring states like Djibouti which in turn subsidizes importation of goods and services.

Despite these and other economic benefits to local and national economy, the Finchaa-Amarti-Nashe project has huge negative impacts on the lives of local people of the zone and that of the displaced ones in particular. The displacement of the people has the following out comes. First, the area from which they are relocated, Nashe watershed, is the agricultural potential of the zone. Farmers of the area are the major suppliers of cereal, livestock and honey productions to markets in the zone. In Nashe watershed, no agricultural activity after all. This could hamper the economy of the zone in many ways. The supply of agricultural and livestock products in markets decrease where as the demand for them increase disturbing the market structure in the zone. Hence, the prices of these products increase. For instance, before 2008, the price of butter per kilo in Gabaa Lagaa market was 20 birr where as in Shaamboo market-town of Horo Guduru was 40 birr. Now days, however, there is slight or no price difference of butter in both markets (Data from Zonal Office). The case is true for all products.

The increase in price of livestock and agricultural products on one hand, and the subsequent reduction of their quantity and quality highly affects the livelihood urban poor people. Although inflation is national wide, Horo Guduru has never experienced such increase in price of goods and commodities because the zone abundant and its products are mostly consumed locally since the zone is less penetrated.

The second outcome is poor property compensation and lack of residential homes for the displaced people, yet. On one hand, these people cannot practice agriculture on extensive lands and rare animals. Even those who involved in agriculture before the coming of 2010 and 2011 summer seasons were in risk as the water dam submerged and invaded their farm lands. For more than two years, households in Nashe watershed consumed what they already had before they told to displace and not to farm. This means, there is food insecurity and starvation in the area. Furthermore, residential areas are not prepared for them and not properly resettled yet. Due to this, these people are encircled by the Nashe water dam, no compensation and resettlement yet. Thirdly, the income of the zone from rural taxation in Horo and Abay Chomman woredas is decreased (Tola, 2011)[12]

The project is also negatively affecting the lives of people on the upper parts of Nashe watershed. Following the creation of Nashe Lake, these upper parts are becoming colder than before which has implication on the health of the people and agricultural productivity. The project also discourages private investors in Finchaa Valley. The land which is currently given to the relocated households was originally given to private investors for investment activities by local government. But, the federal government took away the land from these investors by its sole decision. In this regard, Ato Korje, 2011 said that, “This is against the zonal interest and economy because the zone compensated these private investors on one hand and, the zone lost what it deserves form investment.” Accordingly, neither EEPCo nor the federal government is willing either financially help the zonal government or pay compensation for these private investors.

Generally speaking, the delivery services and benefits of FAN project are examined by assessing performance to targets for installed capacity and delivery of power. What the project provides is much less than its negative impact as compared to other multipurpose projects in Ethiopia (EEPco, 2010). For instance, Gilgel Gibe III hydropower dam has relocated more than 10,000 people where as FAN project will also relocate more than 9000 people while the economic benefits from power generation of the former is by far greater than the later (EEPCo, 2010). FAN project has weakened the economy of the zone following changes in temperature and the displacement with poor compensation.

6.3. Political Impacts of the Project

Dams may create political impacts to their immediate administrative regions, to the county as a whole in relation to its procedures, the manner in which peoples are relocated, and the imbalance between benefits and costs of that project (Bezuayehu, 2006). These political impacts are the implied of or derived from involuntary resettlement of people, disruption of productive systems and lifestyles, inequity in sharing of costs and benefits, affection of the livelihood of the host population, the gender gaps and displacement (WCD,2000; Bezuayehu, 2006:94). Today, according to some studies, community displacement has emerged as a political issue in some countries (eg. India), but not yet sufficiently in other countries (e.g China) (Sims, 2001). In India, the combined efforts of displaced people, middle class activists and the free press and judiciary increased awareness about the social effects of dams (Ibid). In Ethiopia, the social effects of dams are not yet considered at national level whereas local people displaced by these water projects are always victims in the country.

The nature of Ethiopian politics and its legacies have a negative implication on the social, economical and political developments of the country (Merera, 2011). Although unitary system has been ended after 1991 in the country’s political setting, its legacies and the failure to accept nations, nationalities and peoples as a part and parcel of Ethiopia are not yet accustomed by the incumbent regime. Federal system and its approaches are not for manipulation and diversion politics rather the system of share-rule and self-rule (Ibid).

However, the reality of Ethiopian federal approach and practice is different. States act as the representatives of the federal state as opposed to self-rule. The nature and procedures of EEPCo, representing the federal state, can easily prove whereby it hardly considers nations, nationalities and peoples of Ethiopia when it undertakes water projects for hydropower. More often than not, EEPCo calculates only national development and benefits overlooking local people around projects. Put differently, if a project has 100% economic benefits for national economy and 10% for the displaced people EEPCo will commence that project. It believes that the displaced people will benefit equally with the rest of Ethiopian people. Other government institutions and the energy sector also lack public accountability. Civil society groups fear government repression when they attempt to criticize the energy sector (Hathaway, 2008:3).

Federal government and EEPCo kept silent to solve the socio-economic and environmental problems that the people of Horo Guduru are facing. The local government on the other has no confidence and commitment to be a watchdog of local people-victims of the project. If they do it the federal government and they assume as if it is against the national interest; against constitution of the country. This implies, government officials from top to down did not understand what federalism is all about and its major tenants. Hence, the current political and ideological settings are half-heart to encourage the empowerment, development and consciousness of local people.

FAN project has caused considerable political changes in Horo Guduru since 2007. According to Ato Bareda (2011), from office of the zone “The project has initially pure development motive; however, now a days, it is highly politicized project at kebeles, woredas, and zonal, regional and national levels.” At zonal and its constituents units, the major political impacts of the project are manifested in different ways. In 2007, while the local people were told to displace from their original place, there was a fear that these people would revolt against the government contextualizing the national election campaign. Due to this fear, two measures were taken by the zonal administration and seriously done by the woredas in which these people live. The first is the promise that the project and local administrations made for these households (Gura, from FGD, 2011)[13]. These promises include, paying good and enough for property and land compensations; building beautiful and standardized residential areas at least one step better than before-blocket houses; provisions of electricity, pure water supply, and religious houses; provision of modern agricultural inputs that were not used previously like tractors, etc (Bareda, 2011).

Secondly, the local government refused to allow opposition political parties in the zone due to the suspicion that peoples of the zone will double what they made on the 2002 national election in which the ruling party completely lost the election. According to the information from Solomon Denekow[14], 2011, it was only not for two or three days in the limited areas of the zone that the Oromo People Congress came and competed for election, however, not allowed making an election campaign around the project and in rural areas of the zone. Due to this, the displaced people were not getting the chance to vote for political party they want since the only alternative was the Regional ruling party. According to the information from group discussion, these promises were deliberately done by the government to divert their attention. This implies, the fear of the local governments that these peoples would vote against the Oromoo Peoples Democratic Organization (OPDO) hoping the new government would not implement the plan for relocation (Merera, 2011)[15].

There is another structural political impact of the project in Kebeles, Woredas, and Zonal administrations. This is a recent development where by political turmoil created in Horo and Abay Chomman woredas. On the one hand, many officials were jailed, demoted, and criticized in relation to the project. According to FGD, the chairmen and vice-chairmen of Horo and Abay Chomman were accused of committing corruption, and jailed for two weeks; hence they were demoted from their position. These chairmen and vice-chairmen were X & Y of Abay Chomman and Z & V of Horo woredas respectively (Kajela, 2011).

Kebele leaders who participated in and collaborated with the above personnel were also jailed and they were demoted. For instance, x- kebele leader of Hoomaa Kulkulaa, y- kebele leader of Sandaaboo Dongoroo, z- kebele leader of Ejersa Maccaa and v-kebele leader of Alshaayyaa Igguu. Not only kebele leaders but also other executing and registration and estimation committees of the project were also taken to prison and were accused of corruption which includes mahandists, experts, agriculturalists, and individuals who tried to acquire property compensation by registering false properties. Therefore, almost all senior committees, and officials of the two woredas were accused of corruption by Oromia Justice Bureau; and automatically demoted from their previous political power.

As a remedy to administrative problems, by the supervision of zonal officials, new woredas’ officials and chairmen, and that of kebele leaders are appointed based on their commitment to fight corruption, education, political loyalty and previous experience of leaderships at different levels. For example, Ato Dessalegn Gudeta became Chairman of Horo woreda and with his new vice-chairman and other many officials; and Ato Tesfaye Shifara became the Chairman of Abay Chomman woreda with other new officials. The case is also true for kebele leaders.

Thus, the political impact of the project is subsequently related itself to the 2007 national election of Ethiopia in which the opposition political parties were refused to compete in Hoomaa Kulkulaa, Sandaaboo Dongoroo, Alshaayyaa Igguu, and Ejersa Maccaa kebeles where the displaced people live in and at zonal level there was no favorable condition for the opposition political parties to make election campaign, and act freely as the constitution granted them. Because of this, the OPC competed in limited urban areas, and other rural kebeles which have no any direct or little relation to the project. The other very important aspect of political impact is the demotion and promotion of woredas’- officials and kebeles leaders and to some extent that of the zone. Hence, the political situations in 2007 are regulated and related to the project in Horo Guduru. The opposition political parties were not well come by the local governments suspecting the people as they made in 2002 national election. Most importantly political turmoil is created in Horo and Abay Chomman woredas due to the project. Woredas and kebele leaders are accused of corruption as a result many of them were jailed and demoted on one hand and many other new officials and leaders are promoted on the other.

6.4. Environmental Impacts

The construction of dams often causes major land use changes that will have adverse environmental impacts on the community living in certain watersheds (Dixon et al., 1989). Environmental effects of dams comprise degradation of the upper parts of the watershed, sedimentation and changes in water quality and quantity (Ibid; Terry, 1995). Other environmental effects of dams such as loss of forests, wild life habitat, and species of populations (biodiversity), and the emission of green house gases from decomposing vegetation, water logging, salinisation, and hardpan formation may result the decline in soil fertility and quality (WCD, 2000).

Without adequate attention to environmental safeguards down stream flow requirements and monitoring programs, new large dams exacerbate the poor health of many of Ethiopia’s watersheds (Hathaway, 2008). Poor land use management and population pressure are already quickly degrading many of the country’s fragile watersheds. Heavy sedimentation has been experienced by Ethiopia’s existing dams and is a very real risk to the lifespan of new hydro dams as well as for irrigation and water supply which affects downstream ecological functions and exacerbates the rate of downstream erosion. Nashee dam is also facing problem of sedimentation from its beginning due to poor resettlement of the displaced people. The result is rapid soil degradation, massive erosion and sedimentation in the Nashee watershed causing a reduction of water Rivers and underground aquifers..

The electric light supply in rural kebeles and urban areas of the zone makes the requirement of fire wood to decrease. The demand for fire wood had a greater impact on the surrounding forests and environmental aspects in the zone. This reduces the zonal demand for fire energy for different purpose. On the other hand, it leads to the deforestation following the creation of new rural and urban settlements, construction of roads, and other things to facilitate the construction of the dam (Beka, 2011).

FAN project has also created conducive condition for environmental protection. This is due to limitation of the lower and steeper parts of Nashe watershed not to be ploughed and grazed since the area is naturally endowed with forest resources. These measures will facilitate the preservation of these forests and wildlife inhabitants. For instance, areas like Baabboo, Dullachaa, Baqqalee, Cigee etc are with considerable forest cover where wild animals inhabit. Before this project, these areas were subjected to deforestation by local inhabitants for clearance for further farming lands, residential areas and domestic use. Wild animals were greatly suffered from this and traditional hunting practices. But, as the project requires the relocation of local peoples and the plan of the government is to create new park over there, the natural vegetations and wild animals will get the chance to survive (Korje, 2011). Soil erosion will also decrease following decrease in the number of livestock, and the possibility of reduction of flood from the parts of the region (Araarsaa Deesoo, 2011).

The pre-feasibility study of the project indicated that there will be no environmental impact in the watershed and on peoples of the region because local communities who are not displaced are living on the upper parts of the dam and there will not be possibility of pressure on Finchaa town (EEPCo, 2007). In addition, the Environmental Impact Assessment (EIA) of the project showed that there will be limited environmental changes in the watershed and surrounding areas (EEPCo, 2010). But, although it is difficult to tell in concrete terms about the environmental impact of the project, the changes related to new roads construction, creation of new settlements, the demand for new farming and grazing lands and sedimentation problems are prevailing in Nashe watershed. Fragmentations of the land due to population increase and hosting the relocated people are other possible outcomes.

Therefore, FAN project is creating loss of forests, wild life habitat species populations (biodiversity) and emitting green house gases (due to rotten vegetation), changes in water quality and quantity (Dugabas, 2011). Hence, the environmental impact of the project is in progress, it is impossible to provide environmental impacts of the project in detail; hence, the project’s future influence and impact over the environment requires a further and comprehensive study by researchers.

7. Conclusion

The Finchaa-Amarti- Nashe (FAN) development project is one of the newly operating multipurpose projects in Ethiopia under the Ethiopian Electric power corporation, with the objective to generate 70–100 MW hydropowers and to provide modern irrigation on more than 5,200 hectares of land. It started operation since 2008 in Horo Guduru on Nashe River which is the tributary of Blue Nile, Ethiopia (EEPCo, 2007).

The main justification of the project is its economic benefits; local, national, and regional levels (EEPCo, 2010). Locally it will electrify the rural kebeles and the newly emerging small town and urban areas of the zone. The project also fills the gab created by the decrease in FHEP in the zone. Nashe water dam will irrigate huge lands in the valley for the displaced people in new relocation site. Furthermore, employment opportunities; developments and expansions of new socio-economic and cultural lifestyle in the region are the strong sides of this project. Hence, urbanization, socialization, communication, transportation, and provisions of social infrastructure in general are attributed to the coming of the project (Beekaa, 2011).

Nationally, the FAN project will generate huge energy required to transform the economy from agricultural to industrial and service sectors. It creates income from exporting electricity or selling cash crops of processed products from electricity to neighboring states. Therefore, the ever-increasing population of Ethiopia and higher standard of living require the construction of new dams and maintenance of the existing dams (Bezuayehu, 2006:90). In spite of the substantial benefits derived from FAN development project, there are socio-economic, environmental, and political problems created by the project.

However, there are certain points to be clear. Before 2006, the electric supply and other social infrastructures were concentrated to few urban dwellers of the zone like in Shaamboo, Finchaa, ‘Bereha’ and Hoomii. Which means the rural electrification and coverage of electricity in urban areas of the zone is not as a result of the FAN project. However, after 2006 onwards this history has been changed to more efficient and pervasive approach to improve lives of the rural community in the zone. This is due to the hope that the FAN project generates hydropower energy which supports the already existing FHEP. Nationally, it is under the Ethiopian National Rural Electrification Program (ENREP) which accelerates the expansion, coverage and supply of electricity in rural areas (EEPCo, 2010).

The project is appreciated by some rural communities as if it creates new ways of social communications and interactions following the increasingly usage of digital-in small towns and rural kebeles and mobile telephones in remote areas. As one of my informants from FGD (Chali, 2011[16]) said, “Thanks to Nashe Project and China, I can talk to and communicate with my children who are away from home.” But others argue that the new Nashe dam water has stopped social communications and interactions in rural areas among kebeles and villages of areas in Nashe watershed (Dugabas, 2011).

There are also controversial arguments related to the economic benefits of the displaced people in new relocation site. According to Ato Dayaz (2011), the displaced people will be economically benefiting in the new relocation site in which the major economic activity is practicing modern irrigation over extensive and more fertile land than before and there is the possibility of producing twice or more per year and existence of road, market, and information accessibilities since the area is near to Finchaa Sugar Factory (FSF).). Some of my informants from the zone have also explained the economic benefits of these people in terms of compensation (Hibirka, 2011) as majority of the self-resettled households are engaging in business making and also planning to engage in (Luca, in FGD, 2011)[17].

Contrary to this, others argue that the new relocation site is not suitable for human and livestock lives because the area is naturally desert and full of human and animal diseases (Dugabas, 2011). In addition the farming area is very far from residential areas with an average distance of 17 km which is time and energy consuming. Most importantly, people and livestock were originally adapted to temperate climate finding it difficult for them to live in desert areas (Bareedaa, 2011).

The argument of the government is that the FAN project will be advantageous to the zonal economy since it generates energy to the zone, modern irrigation, new technology, creation of new investment opportunities, and fishery (Dayaz, 2011). However, the only benefit of the project to the zone is in terms of electrification while huge amount of money derived from the project is not for zonal economy and even for Oromia. This is because the project is controlled by the federal government (Dugabas, 2011). This is also true for the previously existing projects; (Finchaa, Amarti projects and the FSF) as they are not significantly benefiting the zone (Bezuayehu, 2006). Hence, poor fiscal federalism exists in Ethiopia (Merera, 2011).

Of course the FAN project creates positive social and cultural impacts on the peoples in the Nashe watershed and the zone as social infrastructures like health, education, road, water supply, electricity, and new ideas and ways of social life both in rural and in the newly emerged small towns and urban centers are directly or indirectly related to the project. However, it has also side effects on the peoples in the watershed and the zone with regards to displacement and resettlement patterns and the consequent social, cultural and moral disruption thereof. There is also weakening of social ties and relations based on birth, different associations (ikub, idir, mahber,); and on religious and neighborhood relations. The economy of the zone is also affected by the decrease in agricultural products as the majority of these households are rich farmers who were repeatedly prized at regional and federal levels. Agricultural productivity, near and around the Finchaa, Amarti, and Nashe dams is discouraged simultaneously due to the displacement of huge number of peoples from these areas and, the ever changing temperature of the Horo Guduru. The zone is becoming colder and colder that might change the nature of economic activities along with change of the climate.

The project was also disappointing the people because of poor compensation and resettlement, lack of enough social infrastructures in the new relocation site. When we compare original areas and the new relocation site, there are great variations (Beka, 2011). The original area is comfortable for agricultural productivity, has moderate and temperate climate and its elevation is 2200–2500 m above sea level. However, the new relocation site is desert but, highly suitable for irrigation. The elevation of this new site is 1600 m below sea level. According to one of the agricultural experts from the zone, Mirgisa, 2011[18], and from Socio-economic Affairs of the zone, Dalasa, 2011[19], the economic benefits that these people get in their original places is by far greater than what they would produce and get in the relocation site.

Moreover, communities, directly or indirectly affected by the project, lacked any mechanism to address their grievances regarding resettlement, compensation and other impacts to legally protect their rights to life, property and freedom. After a limited amount of compensation is paid, no body or organ of the government follows them up in terms of moral and other socio-economic supports. In terms of the cost benefit analysis, the project has more negative impacts than its positive aspects for the local people. Ato Dugabas said that, Miidhaan Nashee faayidaasaa harka sadiin caala,” which means “The disadvantage of the project is three times its advantage for local people.” The people of the zone will get only limited and poor electric supply and energy where as huge amount of money earned from the project is for the federal government, even not for Oromia National Regional State (ONRS). Thus, the construction of FAN project was planned top-down and the communities were not recognized and consulted well. It was not on the basis of the local peoples’ interest. Bezuayehu (2006: 98) states that;

In Ethiopia dams are planned top-down, relocate people against their will, cause haphazard land use changes and increased soil erosion and reservoir sedimentation. Communities have not been sufficiently recognized and compensated and environmental protection measures such as land use planning and [soil and water conservation] have not adopted in watersheds where dams have been implemented. Revenues generated from hydropower and water supply dams often benefit urban dwellers or the national economy at the costs of rural inhabitants.

More over the committees of the project were corrupt. They favored some people and disfavored the others based on blood line and patronage. These committees added and overestimated property compensation for those relatives, patron, collaborators, and those who gave bribe. Very technical and informal way of registering property compensation by the name of imagined woman or man was made. This money is divided between these committees including top officials of Horo and Abay Chomman woredas. In addition, there was a system of generating property compensation for their relatives who did not displace. On the other, these committees acted against the people who refused to give bribe and have personal problems with them (Wakabdi, 2011)[20].


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[1] Abay II is a new project located between Horo Guduru and Bure. It is currently underway to be constructed.

[2] Ato Dadi Jalata, from, Zone, interviewed on 25/01/2011 at 10–11:30am.

[3] Ato Kajela Tola, from office of Horo woreda, interviewed on 29/01/2011 at 10–12:00am

[4] Ato Dugabas Kuncas, from office of Horo Woreda, interviewed on 27/01/2011 at 8–9:30 a.m.

[5] Ato Badho Badhasa, from Abay Chomman woreda, interviewed on 06/02/2011 at 11:30–12:00a.m.

[6] Ato Bareda Bulcha, from office of HGWZ, interviewed on 08/02/2011 at 10:00–11:00 a.,m.

[7] Ararsa Deso, Director of Daaddoo Siree Budoo school (1–8), interviewed on 18/04 2011 at 12:00a.m-1:30p.m.

[8] Ato Korje Dima,, from office of the HGWZ, interviewed on 04/02/2011 at 1:30–2:30 p.m

[9] Ato Juka Boru, from office of the HGWZ, interviewed on 04/02/2011 at 9–9:45 a.m.

[10] Ato Hibirka Galan, from Offoce of HGWZ, interviewed on 27/01/2011 at 8:30–9:45 a.m..

[11] Ato Beka Wakjira, from office of Abbay Chomman woreda, interviewed on 29/01/2011 at 2:45–3:15 p.

[12] Ato Tola Badasa, from Abay Chomman woreda, interviewed on 28/01/2011 at 8–9 am.

[13] Ato Gura Eba, representative of local community, discussed on 09/02/2011 at 11:oo12:309p.m.

[14] Ato Solomon Denekow, representative of OPC in HGWZ, interviewed on 09/02/2011 at 10:00–12:00 a.m.

[15] D.r Merera Gudina, Lecturer in AAU, Chairman of OPC, UDEF, and PSIR Department, interviewed on 21/03/2011 at 11:30–12:00 a.m.

[16] Ato Cali Amane, farmer from upper part of Nashee watershed, interviewed on 01/02/2011 at 12:00–1:30 p.m

[17] Ato Luca Moke, is member of cabinet of Alshaya Igu, interviewed on 02/02/2011 at 2:00–3:00 p.m.

[18] Ato Mirgisa Roba, one of Agricultural experts in HGWZ, interviewed on 10/02/2011 at 4:30–5:20 p.m.

[19] Ato Dalasa Olana, one of officials from Socio-Economic office of the zone, interviewed on 10/02/2011 at 8:45–9:30 a.m.

[20] Ato Wakabdi Jirata, representative of local people, interviewed on 05/02/2011 at 10–12:00 am.