KAJAKI DAM: MORE ENERGY AWAITS ENHANCED SECURITY

SECRET S E C R E T SECTION 01 OF 02 KABUL 003472 C O R R E C T E D COPY (PARA MARKINGS) SIPDIS STATE PASS TO USAID ASIA OFFICE AND S/SRAP STAFF E.O. 12958: DECL: 10/29/2019 TAGS: EAID, EFIN, ENRG, KPWR, PGOV, AF SUBJECT: KAJAKI DAM: MORE ENERGY AWAITS ENHANCED SECURITY REF: 08 KABUL 2546 KABUL 00003472 001.2 OF 002 Classified By: Deputy Ambassador Francis Ricciardone for Reasons 1.4 (b ) & (d) 1. (S/REL ISAF, AFG) SUMMARY: The Kajaki Power Dam project in Northern Helmand -- a signature U.S. development program in pre-war Afghanistan undergoing rehabilitation for several years -- could generate sufficient electricity to benefit 330,000 residents of Helmand and Kandahar provinces. Completing the project would advance U.S./ISAF counterinsurgency strategy by creating jobs and providing energy and water for agricultural development, thereby winning locals to the side of the Afghan government. Unfortunately, implementing the next phase -- a two-year, $170 million project to install a third on-site turbine and construct necessary transmission lines -- requires improved security at the dam and in the area. Neither ISAF nor GIRoA can commit to providing the required security until at least 2011, if then. Meanwhile, USAID's contract security for the parts stored on site is costing $1 million per month. Therefore, USAID will take immediate steps to mothball the parts and entrust their protection to the GIRoA site manager. Effectively, this means the abandonment of the last phase. END SUMMARY. ADDITIONAL ENERGY GENERATION ON HOLD ------------------------------------ 2. (SBU) Although USAID completed repair of one of the dam's two operational turbines in October, lack of secure access to the dam has delayed plans to install a third turbine and 18.5 MW generator and build a 110 KV transmission line to carry low-cost power to an additional 120,000 people in the troubled south. Increased electricity would stimulate economic growth and create jobs in Helmand and Kandahar; provide a return on a substantial U.S. investment; and likely entice other donors to invest in much-needed development projects such as building cold storage and value-added agricultural processing facilities. All of these outcomes would promote our counterinsurgency strategy by tangibly demonstrating that the Government of Afghanistan -- rather than the insurgents -- can deliver services, opportunities and hope for a better life to its people. COMPLEX OPERATION, LIMITED FORCES --------------------------------- 3. (SBU) Insurgent strength and activity, however, are significant obstacles. In September 2008, ISAF forces ensured the safe delivery of the $20 million, 20-ton, 18.5 MW turbine itself along the 180 km route from the Ring Road to Kajaki (reftel) using close air support, ground troop deployments and a road-clearance package to detect and defuse IEDs. The turbine has been in storage since then, awaiting appropriate security for delivery of the installation materials and subsequent construction. 4. (S/REL ISAF, AFG) Installing the third turbine and building the transmission lines requires transporting heavy equipment and 900 tons of cement and aggregate to the site via the dangerous 87 km route from the Ring Road to Kajaki. Insurgents are entrenched in the Kajaki area; although 107 British troops defend the dam itself the troops are too few to provide security for the installation and transmission lines construction stages of the project. Current ISAF strategy in the province is focused on securing population centers -- Marjah, Garmsir, Nawa and the approaches to Kandahar City in the south -- rather than northern Helmand where the dam and transmission lines are. Future ISAF plans for the region are still under development. 5. (C/REL ISAF, AFG) USAID will continue to provide contracted security for the technical advisors and turbine parts at the site through the end of April 2010 at the latest, at a cost of $1 million per month. Given that neither ISAF nor GIRoA can commit to providing the needed security until 2011, if then, and that USAID's contract security for the site costs $1 million a month, USAID is taking steps to inventory the turbine parts and store them until appropriate security is available. USAID will continue with plans to upgrade Kandahar city's electrical distribution system, which will improve power services in the city even without additional power from Kajaki. However, additional possible enhancements affecting up to 640,000 Afghans -- such as raising the water level in the Kajaki dam reservoir to increase irrigation and generate more power; building a new power-house for an additional 100MW of power; and constructing a new transmission line from Kajaki to Kandahar -- would also have to wait for improved security. 6. (S/REL ISAF, AFG) COMMENT: Moving ahead on this project KABUL 00003472 002.2 OF 002 requires an improvement in security. There are clearly significant benefits to be gained if this can be accomplished. The U.S. and ISAF are pursuing a counterinsurgency strategy focused on protecting the population and demonstrating that the Afghan government can and is delivering on its promises to improve the lives of its citizens, and Afghans seek access to electricity and employment opportunities above all other development goods or projects. Installing the 18.5 MW turbine and constructing the new transmission line would meet those needs by enabling the government to increase the reliable supply of low-cost electricity, provide more water for irrigation, promote agricultural production and create jobs. Such tangible evidence would contribute to our stabilization efforts and make a strong counter-insurgency statement. Plans for stabilization and development in northern Helmand and Kandahar are contingent upon enhanced security, absent which USAID will mothball the project until the security situation permits a new start. END COMMENT. EIKENBERRY