Pakistan’s Gomal Zam Dam Has Not Generated the Electricity Anticipated Despite Millions in USAID Investments

Audit Report
Report Number
5-391-18-001-P

In 2010, the U.S. Secretary of State announced programs to address problems with electricity shortages and water scarcity in Pakistan. In response, USAID/Pakistan signed an agreement with the Government of Pakistan in January 2011 for the Gomal Zam Multipurpose Dam Project, designed to add 17.4 megawatts of generation capacity to the national electric grid, provide drinking water, and help with flood control in three strategically important areas. USAID followed up by funding the Gomal Zam Irrigation Project to boost food production by bringing water to 191,000 acres of agricultural land. As of September 2016, USAID had committed $117 million for the two signature projects and related dam and irrigation works. We conducted this audit to determine whether USAID/Pakistan implemented key elements of these signature projects. We found that the hydroelectric component of the Gomal Zam Multipurpose Dam Project was not generating the anticipated amount of electricity. Electricity generation ceased in October 2016 and had not yet been restored. In addition, during implementation, USAID added funding to the fixed-amount reimbursable agreement it had with the Pakistani Government for the Gomal Zam Irrigation Project, increasing the ceiling from $40 million to $51.5 million and defeating the cost-control purpose of the agreement. Further, USAID did not ensure that its implementer complied with environmental protection steps. USAID/Pakistan agreed with all three recommendations we made to address these problems.

Recommendations

Recommendation 1

USAID/Pakistan implement a plan to work with executive management at the Water and Power Development Authority to expeditiously resolve the critical issues limiting power generation by the Gomal Zam Dam.

Questioned Cost:
$0
Recommendation 2

USAID/Pakistan recover from the Water and Power Development Authority the $11.5 million increase in the fixed-amount reimbursable agreement for the Gomal Zam Irrigation Project.

Questioned Cost:
$11,520,000
Recommendation 3

USAID/Pakistan require the Water and Power Development Authority to remediate borrow sites as required by the project environmental mitigation and monitoring plan.

Questioned Cost:
$0