Rogun Hydro Power Plant Fiscal Analysis

The Rogun Dam has an annual electricity production potential of 13.3 TWh. The construction of the dam begun in 1976, however, the project was halted after the collapse of the USSR. Today the completion of the dam construction is seen by the government of Tajikistan (GoT) as a national priority. The analysis identifies the fiscal impacts of the Rogun HPP (hydro power plant) by their source and timing. The analysis estimates the net impact of the project on the national treasury, these include incremental primary and secondary tax collections and dividends that will be realized by the GoT. The present value of these inflows to the budget, discounted at 10%, are then reduced by the present value (PV) of the government contribution to the investment cost (USDm 591). The two main shareholders groups are the GoT and private domestic shareholders. If the GoT were to fully finance the construction from the budget, the project will not be financially viable for the treasury, even when all collected taxes are included to the estimation of the project’s returns. The budget will suffer the loss of 394 USDm in present value terms at 10% discount rate. The PVs of the returns to the private shareholders is only positive if the smallest dam height will be constructed.