Three Gorges Dam Cost: How much did it cost to build such a huge project?
Where exactly did the money go?
|Three Gorges Dam Cost||Static Investment||Dynamic Investment|
|Pivotal Project||¥50 billion (US$ 7.3 billion)||¥126.4 billion (US$ 18.4 billion)|
|Power Transmission and Transformation||¥32 billion (US$ 4.7 billion)||¥36.5 billion (US$ 5.3 billion)|
|Immigration and Resettlement||¥53 billion (US$ 7.7 billion)||¥85.7 billion (US$ 12.5 billion)|
|Total||¥135 billion (US$ 20 billion)||¥249 billion (US$ 37 billion)|
1. The calculation is based on the price level at the end of May in 1993.
2. Static investment includes engineering fees of construction and installation, equipment and tools, other construction costs, basic reserve fees, etc.
3. Dynamic investment refers to the sum of estimated investment needed by the whole Three Gorges Dam Project. In addition to the static investment, it also includes loan interests in construction period, adjustment tax for investment direction, price and interest rate, reserve fees for price rise, and so on.
Where did the money come from?
China’s government used multiple methods to raise funds to cover the huge Three Gorges Dam cost, by loans from China State Development Bank, benefits from electricity power of Gazhouba Dam, national debts, corporate bonds, etc. Moreover, Three Gorges Project Construction Fund was collected with an additional electric charge of ¥0.003 per kWh since 1992. In 1994, the charge was changed into ¥0.004/kWh; and ¥0.007/kWh in benefited areas of Three Gorges hydropower station since 1996. In the later period, the benefits of the partially operated Three Gorges hydropower station also became a source of the fund.
Three Gorges Dam cost has been recovered.
Three Gorges Dam began to make profits since 2003 when the first batch of power generating units were put on production. Up to 2018, the annual power produced by Three Gorges Hydropower Station has exceeded 100 billion kWh, and the accumulated electric energy production has reached 1.2 trillion kWh, from which the accumulated income is as high as ¥300 billion (US$ 44 billion), calculated on the electricity price of ¥0.25/kWh. That means the Three Gorges Dam cost has been recovered.
Payback of Three Gorges Dam
Three Gorges Hydropower Station is the largest hydropower enterprise around the world, bringing more than ¥50 billion (US$ 7.3 billion) income every year, in which the net profits reaches ¥20 billion (US$ 2.9 billion). And this keeps rising year by year. In the year of 2018, its income was ¥51.2 billion (US$ 7.5 billion) and the net profit was ¥22.6 billion (US$ 3.3 billion). Someone joke that Three Gorges Dam has been a money printer of China. In addition, plenty of benefits have been made from tourism in the dam area.
But the payback of Three Gorges Dam cannot be measured simply by financial profits. It plays active roles in flood control, irrigation, navigation, etc., which saves people’s life and boost the economy development, which can never be calculated with money.