Institutional Arrangements
The Project is structured as a BOT project. It has a concession period of 31 years, of which the operating period is 25 years. At the end of the concession period, the project facilities will be transferred to the government free of charge.
The project was developed by NTPC, which is owned by a consortium comprising EDF (40%), EGCO of Thailand (35%), and the Government of Laos (25%). Governments and government-owned enterprises own a majority of NTPC. This situation is atypical for an IPP - normally the power generating company is privately owned.
Laos is a People's Democratic Republic with a one-party system under the Lao People's Revolutionary Party. It is one of the few communist states in the world.
The government has multiple roles related to NT2, some of which may be conflicting: It partially owns NTPC and thus has an interest in the financial profitability of the project; it is supposed to monitor compliance with environmental and social safeguards under the concession contract; and it buys some of the electricity generated from the project through the state-owned power company EDL and thus has an interest in low electricity prices.
Some of the owners of NTPC are also contractors engaged in the construction of the dam. For example, EDF International is the head contractor for the entire project under a turnkey contract. It has engaged various sub-contractors for specific parts of the project.
Read more about this topic: Nam Theun 2 Dam
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