Arayat Embankment Dam and Irrigation System for

Pampanga River Flood Control in Central Luzon, Philippines

Aditya ChagantiSaakshi GuptaSham Thanekar

December 10, 2014

Objective

If funded, this project will provide a Dam that ensures stable power supply, clean drinkingwater and increased accessibility to residents of Central Luzon

1 Motivation

1.1 Geography

Pampanga River is located in the Central Luzon region of Philippines in the Asiancontinent. The river basin is the third largest river in Philippines, with its headwatersrunning from Sierra Madre for about 260 km. The Pampanga River Delta forms at themouth of the river, where the river flows into the Manila Bay. The Pampanga delta liesat the lower sections of the river basin and the river system divides into small branches,canals, and fishponds which find their way into the Manila Bay (Britannica). The Deltahas been identified and marked in Figure 1 (Naval History and Heritage).

1.2 Hazards

In general, the Philippines is prone to tropical storms that cause widespread destructionfrom flooding and landslides. More specifically, the lower basin of the Pampanga Riverexperiences flooding, due to the typhoon’s intensity. In the Delta, considerable damageoccurs to property and industry activities. During phase 1 of the river improvement works,flood return period was estimated to be for a 20 year return period probability (PampangaDelta Development Project, Flood Control Component).

This flooding is being caused by sinking of the Pampanga peninsula, decrease in floodplain areas due to urbanization and global sea level rise and land subsidence (The Philip-pine Star).

http://www.britannica.com/EBchecked/topic/440458/Pampanga-Riverhttp://www.history.navy.mil/pics/bases/bases2-p391.jpgPampanga Delta Development Project, 2004http://www.philstar.com/nation/226173/pampanga-continues-sink

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Figure 1: Location of the Pampanga River Delta

1.3 Politics

The area is relatively peaceful with small water sharing disputes. Water in the upperPampanga river is fit for municipal use while water in the lower reaches of the basin is fitprimarily for irrigation (International Water Management Institute (IWMI))

1.4 Stocks/Flows

The Pampanga River is a source of hydroelectric power to the Luzon Grid, irrigationto about 360,000 hectares of farmland, industrial, commercial and domestic water. (LocalGovernment Academy, Philippines)

2 Justification

The Philippines is one of the most hazard-prone regions of the world. Natural disasterssuch as typhoons, floods, droughts and volcanoes place a significant burden on governmentfinancial planning in order to meet the needs for expenditure in relief and rehabilitationof those affected by disasters. Unplanned expenditure in response to certain disastershampers the government’s ability to invest in required infrastructural improvements andpoverty alleviation programs. While natural hazards have significantly exacerbated theproblems of Philippines’ poor, poverty alleviation programs rarely incorporate programsfor mitigating hazard vulnerability. Donations to disaster-related programs have largelyfocused on disaster response, rather than prevention or mitigation.

The primary natural hazards that take place at a high frequency of occurrence includetyphoons and tropical storms and the flooding that occurs as a consequence. The eco-

http://www.iwmi.cgiar.org/Publications/Working Papers/working/WOR78.pdfhttp://www.lga.gov.ph/sites/default/files/knowledgeExchange-pdf/pampanga/PRB-M1-

Pampanga%20River%20Basin%20Situationer.pdf

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nomic damage from typhoons is estimated to be of the order of millions of USD every year.While this is a small fraction of the actual GDP of the Philippines, the impacts of floodingare highly localized and result in unquantifiable impacts to food security, natural resourcesand the environment. Also, since flooding usually occurs in tandem with typhoons – whichcause damage worth tens of millions of USD per year – it is difficult to isolate the damagefrom floods from the overall damage from typhoons and storms. The Philippines Atmo-spheric, Geophysical and Astronomical Services Administration (PAGASA) estimates that47% of annual average rainfall occurs due to typhoons, while the remainder is distributedbetween monsoons and other weather systems.

The Central Luzon area is particularly prone to heavy flooding. The 1972 floods affectedthe main rice-producing areas of Central Luzon and disrupted economic activities to suchan extent that rice was rationed in central Manila. An apparent increase in incidence offlooding has been reported as a result of deforestation (Citizens’ Disaster Response Center,1994). Incidents of flash flooding, such as the 1990 Ormoc flood, have been attributedto environmental degradation. Rapid urbanization without improvements in drainagecapacities have resulted in urban flooding in several places.

The Philippines economy has gradually been transitioning from agricultural to indus-trial. Agriculture today contributes to about 14% of the Philippines’ economy. While theshare of agriculture to the nation’s GDP has been falling, it still employs about 32% of theworkforce (Republic of Philippines, National Statistical Coordination Board, 2009). Thenegative impacts of flooding on agricultural production are several, from direct impactssuch as reduced farm production, damage to infrastructure and damage to supply routesand markets, to indirect impacts such as reduced productivity, reduced food security andincrease in food prices.

The damage to natural resources and the environment, while significant, are yet to beeffectively quantified. The direct negative impacts of environmental damage include soilerosion (which increases the severity of flooding), siltation and sedimentation, reduced soilfertility, reduced tree and vegetative cover, water pollution and waste accumulation anddeformed topography. It is important to consider these impacts since they often result inan increase in the severity of flooding.

3 Work Package

3.1 Adaptation Technique

For the purpose of flood control, our team is proposing the construction of an earth-filledembankment dam.

3.1.1 Uses

This multi-purpose dam delivers water for irrigation, drinking water and hydroelectricpower generation while its reservoir aids in flood control. Other extended uses include foodsecurity through accessible roads, improved sanitation through water treatment plant,increased efficiency of business through steady power supply and overall GDP growth.

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3.1.2 Location

The proposed dam site (15◦11’16.1”N 120◦46’43.8”E) lies in between Mt.Arayat, anda forested tract of land (as marked in Figure 2 below). We chose this location as citiesdownstream (Sulipan, San Luis and Arayat) suffer annual flooding [Figure 3]. Locatinga dam here would inundate areas upstream, especially those north of the fork where thePampanga and Rio Chico rivers meet. However, the location was chosen considering thefact that both of these rivers flood annually, and building a dam on any one of them northof the fork wouldn’t result in optimal reduction of flooding downstream.

Figure 2: Floodmap of the Pampanga River Basin

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Figure 3: Location of the proposed dam

3.2 Effect on Engineering Infrastructure

3.2.1 Energy

Hydroelectric Energy is one of the largest sources of renewable energy, and is set togrow even further with more and more nations realizing its benefits over generationaltime horizons. It boasts an average of ninety percent conversion efficiency, and still hassignificant unrealized potential with respect to power generation.

Philippines has been experiencing an acute energy crisis in recent times. The problem isparticularly severe in Luzon, where power generation is expected to fall short by a thousandmegawatts next spring (Philippines Power Crisis: The Battle to Keep the Lights On, TheWall Street Journal, September 2014). Given this, the hydroelectric energy generationpotential of the proposed dam was analyzed.

The width of the Pampanga River at the proposed site was found to be 650 feet.

Location Discharge (m3/s) Velocity (m/s) C/S Area (m2) Width (m) Depth (m) Depth (ft)

Arayat 774.5 1.2 645.4 127 5.1 16.7

The depth, 17 feet is assumed to remain constant at all sections of the river. Therefore,depth to the bottom at the proposed site is 17 feet. The cross section at the site ofconstruction is calculated as the product of the width at the proposed site and the depth,which is equal to 10,855 sq. ft.

Manning’s Equation for instantaneous flow measurement:

Q = 1.486 ∗A ∗R2/3 ∗ S1/2/n (1)

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Where Manning’s n value (Roughness factor depending on channel lining) for flood-plain=0.06 (Meals et al., 2008). Estimates for wetted perimeter and slope are taken froma point at San Isidro, which is only around a 25 km journey from Arayat.

Taking the river bed slope as 0.00033 (Pampanga River Basin Flood Forecasting andWarning Centre, 2004) and the wetted perimeter as 52 ft, we get the discharge rate as1940 m3/s.

A large earth dam, typically exceeding 15m in height over the deepest riverbed is nor-mally used for flood discharges in excess of 2000 m3/second. (Agarwal) Therefore, it isassumed that the dam has a height of 15m from the deepest point in the riverbed. Thisestimation allows us to establish a base case of power generation potential. Further studieswill have to be carried out to accurately estimate the specific design of the dam.

The river depth at this point, as computed previously is 5.1 meters. Assuming the waterlevel upstream is 3m below the crest, the head (H) is equal to 6.9 meters. Therefore,

Power = gρQH = 134MW (2)

Where ρ, the density of water, is taken to be 1000 kg/m3. Assuming 24 hour operation,and 90% efficiency of generators, potential energy production per day is equal to 2.9 millionkWh/day

The average per capita power consumption for Philippines is 524.21 kWh/year. [TheWorld Factbook, Central Intelligence Agency] Assuming this holds good for Central Lu-zon, the annual power consumption for the population of Luzon is equal to 5242 millionkWh/year. Therefore, the proposed dam, operating at full potential would meet approxi-mately 20% of the power demand in Central Luzon.

Impacts of Climate ChangeOne of the primary effects of climate change is accelerated sea level rise. Given inces-sant flooding in Central Luzon, and the Pampanga River Delta in particular, incidence offlooding is only likely to increase in the near future. In addition to larger measures to con-trol climate change, specific policy and action must be aimed at harnessing its immediateeffects. To this end, hydropower generation is poised to gain significantly from increasedflows, leading to increased power generation. Further, use of the water’s kinetic energyfor power production means that it acts as a buffer ensuring that regions downstream areprotected from volatile currents.

Risks and VulnerabilitiesHydropower generation could benefit from increased flows up till a certain point. However,beyond that limit, high velocity floodwater has potential to cause significant damage tohydropower generation infrastructure such as the turbine, which would be exposed directlyto floodwaters that typically carry a large amount of debris, and strike it at a very highvelocity.

Surface Water Flow Measurement for Water Quality Monitoring Projects, Donald.W.Meals andSteven.A.Dressing, 2008

Agarwal Y.C., ‘Design of Small Earth Dams’

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AdaptationAdaptation solutions therefore, would have to address the issue of damage to hydropowergeneration equipment as a result of prolonged exposure to debris bearing, high velocityfloodwater. Two solutions that, if implemented together, would suitably address this issueare as follows:

• An upstream debris trap similar to The Fraser River Debris Trap (Fraser BasinCouncil, 2012) could be considered. Debris traps are typically made of floatingbooms that intercept debris, and prevent it from flowing beyond a certain point.Therefore, installation would reduce the quantity of debris that comes in contactwith the turbine, thus minimizing damage to hydropower generation infrastructurein the long term. Implementing a debris trap would also have a range of benefitsdue to the presence of a wide diversity of beneficiaries that depend on the river forsustenance. A cost-effectiveness study conducted on The Fraser River Debris Trapshows that the beneficiaries include everyone from residents and recreational boaters,to industries (wood, fishing), and even the Ruskin hydropower plant, which avoidscosts on exposure to debris. (Thonon, 2006).

Eventually, the cost-benefit analysis found that the installation of the debris trapwould result in $8 Million in avoided costs, and pays for itself 12 times over. (Inthe considered time horizon) Although a similar cost-benefit analysis is outside thegamut of this study, the following informed qualitative estimations can be made withreasonable certainty:

– The beneficiaries in the Pampanga river delta are likely going to be similar tothose in the Fraser River System, given that river deltas are generally charac-terized by high development relative to the region.

– Further, given that flooding is such a prevalent issue, the volume of debris islikely to be comparable to the Fraser River System.

Given these observations, it is entirely plausible that a River Debris Trap, apart fromprotecting the proposed adaptation infrastructure, leads to a larger set of benefits.A detailed study aimed at investigating this would be necessary to further buttressthis proposal.

• Regular maintenance work including a periodic structural health analysis frameworkis essential towards ensuring that the hydropower generation remains at optimallevels.

3.2.2 Agriculture

Risks and VulnerabiltiesWhile the impact of typhoons and floods on agriculture is negligible at the national level,there is a significant impact on rice production at a provincial level. Central Luzon is thebiggest paddy-growing region in the Philippines. In the period from 2007-2011, CentralLuzon suffered damage to rice farming to the tune of USD 90 million per year on average,while the Philippines in general suffered estimated losses of around USD 215 million peryear on average (Israel, 2012). Flooding also has a significant impact on food securitydue to reduced production and damage to transportation infrastructure and markets. Asa coping mechanism, besides buying cheaper or less preferred food, a large proportion ofhouseholds in Central Luzon resort to buying food on credit (46%), eating wild/gathered

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food (39%), reducing number of meals by adults (47%), reducing meal portions (34%),borrowing food (33%) or skipping meals for the whole day (20%).

Impacts of Climate ChangeThe impact of climate change on agricultural production in Central Luzon will be tointensify the impacts the region already suffers from natural disasters. Climate models(MO-COMSTE, 2010) predict an increase or no change in annual average rainfall in Lu-zon. However, the region will also be drier for longer periods than normal, which impliesthat rainfall during typhoons might increase during the times of the year that they occur.An increase in the intensity of rainfall during typhoons can be expected to cause largerfloods than those experienced currently.

Adaptation The dam will safeguard against flooding the agricultural lands on the banksof the river. Between 1998 to 2004, the maximum level to which the water rose was 4.87m(Pampanga Delta Development Project report, 2004). The height of the proposed dam isadequate to accommodate this level of water, with a safety factor of about 0.5m. In ad-dition, irrigation canals are proposed to be built that will provide a reliable water supplyfor water cultivation while doubling as drainage systems during typhoons and floods.

Approximately 2500l of water is required to produce 1 kg of rough rice (Terjung,1983). The yield of rice in South-East Asia is approximately 4.5 tons per hectare (Kup-kanchanakul, 2000). This means that the water requirement per square meter of paddyfield is about 1.125 m3 per year. Therefore, the water requirement for 1 ha (10,000 m2)of land is 11,250 m3 per year. The total land area under cultivation in Central Luzon isabout 700,000 ha (CountrySTAT Philippines), which would theoretically require 7 billionm3 water per year. The average flow rate of the river is about 1,938 m3/s, which translatesto 61 billion m3 water per year. While this shows that the river is capable of supplyingthe irrigation needs for the entire region, we wish to use a majority of that supply forpower generation. Keeping in mind cost considerations, we are setting a target of irrigat-ing 10,000 ha of agricultural land, which would require water withdrawal of 110 millionm3 per year.

3.2.3 Water

Impact of Climate ChangeClimate change can decrease the water level of a dam and its reservoir. In fact, recentlythe Pantabangan Dam experienced a dip in dam’s water level due to high temperature and

The World Bank Group (2011), ‘Vulnerability, Risk Reduction, and Adaptation to Climate Change inthe Philippines. Climate Risk and Adaptation Country Profile’

Benson, C. (1997), ‘The Economic Impact of Natural Disasters in the Philippines’. Overseas Develop-ment Institute.

Brown, N . , Amadore. L . A . and Torrente, E.C. (1991) ’Philippines Country Study’ in ADB, DisasterMitigation in Asia and the Pacific. Manila. Asian Development Bank.

CDRC (1994) ’CDRC 1994 Annual Report’. Quezon City: Citizens’ Disaster Response Center.Israel, D.C. and Broines, R.M. (2012), ‘Impacts of Natural Disasters on Agriculture, Food Security, and

Natural Resources and Environment in the Philippines’. Philippines Institute for Development Studies.Terjung W.H. et al (1983), ‘Crop Water Requirements for Rainfed and irrigated Rice (Paddy) in

China’. Arch. Met. Biocl., Ser. B 34, 181-202.Kupkanchanakul, T. (2000), ‘Bridging the Rice Gap in the Asia-Pacific Region’. Food and Agriculture

Organiation.CountrySTAT Philippines (2012), Retrieved Dec 10, 2014.

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additional area that needed water1. There has been a significant increase in the numberof hot days and warm nights. Both maximum and minimum temperatures are gettingwarmer.2 This could decrease the amount of water available through the reservoir forwater supply.

Risks and Vulnerabilities The water treatment plant is susceptible to electricity short-ages and flooding. Pampanga province experiences power shortage and blackouts regularly.3 An electricity outage would stop the water treatment operations thus cutting water sup-ply to residents. We anticipate that the hydro-electric power generation from our damwill then provide the necessary power to operate the plant.

AdaptationInstallation of the water treatment plant is the adaptation solution for supplying cleanwater to residents of Central Luzon. The water treatment plant will supply 1.15 cubicmetres per seconds and cost $27 million. In general, 1/10th of the water is used by res-idents (municipal component) of Philippines, which is 902.7 cubic meter per inhabitantper year (World Bank).4 Therefore, 90.3 cubic meter per year are used by residents forwater supply. In Central Luzon, there are approximately 10 million inhabitants. This is900 million cubic meter per year for Central Luzon itself, which equals 28 cubic meter persec. Therefore, our water plant provides about 4% of the water needs of the Luzon area.

3.3 Policy Infrastructure

3.3.1 Transportation

The impact of flooding on transportation is usually felt in urban areas, where limitationsto surface transport can severely disrupt local economies. The direct costs of flooding ontransportation can include lives lost by vehicles getting washed away. Indirect cost usuallycome from reduced accessibility, including reduced work hours, reduced food supply due tolack of connectivity between farms, processing facilities and markets, medical emergenciesdue to reduced access to hospitals, and hindrances to relief operations.

Both direct and indirect costs are likely to increase due to increased flooding. TheArayat district hospital is an important medical center with modern facilities that liesjust downstream of Mt. Arayat. San Simon, Minalin, Macabebe and Masantol are majormunicipalities downstream of Mt. Arayat that frequently experience urban flooding.

By reducing the impact of river flooding, the proposed dam would solve many of theaccessibility problems faced by urban centers downstream of Mt. Arayat. In addition, wepropose building a two-lane road on top of the dam in order to improve east-west connec-tivity. We don’t expect the additional costs of building the road to be very high, and wewould gain significant connectivity improvements for insignificant marginal expenditure.

It is very difficult to estimate the costs of flooding on transportation, since most of thedamage comes from indirect costs. That is the reason we aren’t proposing any additional

1http://www.philstar.com/nation/2014/05/17/1323869/pantabangan-dam-stops-irrigation-cl-farmlands

2http://www.theguardian.com/environment/2014/mar/31/ipcc-climate-change-cities-manila3http://world.time.com/2013/08/06/no-end-in-sight-to-the-energy-crisis-that-plagues-the-philippines/4http://chartsbin.com/view/1455

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road infrastructure development as part of this project, and hope that reduced floodingwould significantly mitigate the social cost of damage to transportation infrastructure andreduced connectivity.

3.3.2 Health and Sanitary Conditions

Implementation of the first phase of the project resulted in a considerable improvementin sanitary conditions, with improvements being felt by around 70% of the respondents ofa field survey undertaken as part of the PDDP. [Pampanga Delta Development Project,Flood Control Component, Taro Tsubugo, 2004] Forty six percent of the residents whorecognized an improvement in sanitation also recognized a substantial decrease in waterborne diseases. These statistics suggest that there have indeed been fairly tangible im-provements with respect to the health and sanitary conditions in the area, as a resultof implementation of the program. However, a sizable portion of the respondents to thesurvey see no improvement, which suggests that potential sanitary and health benefitshave not been accrued to their full potential. Policy therefore, must aim to address thefollowing objectives:

• Propagating water management such as rainwater harvesting, and a drainage systemto ensure efficient use of rain and residual floodwater.

• Increased investment in public outreach programs aimed at educating the residentsof the region about the importance of efficient water management, and the perils ofpoor sanitary conditions, and their effect on health.

• Subsidize water management systems, or offer incentives on implementation of thesame.

3.3.3 Tourism

Effect of Dam Adaptation Technique on TourismIn order to support the proposed dam economically, we plan to employ tourism activitiesby promoting and developing Mt. Arayat as a major ecotourism area. This shall provideadditional income to the community and support the building of the dam. Moreover, thewater channels from the dam can sustain the existing Mt. Arayat National Park as thedam is situation between Mt. Arayat and a forested tract of land. The National Parkdisplays a great diversity of flora for a wide range of wildlife. At the foot of the mountain,swimming pools, fish ponds and other facilities are available [Touristlink]. The buildingof the dam can have a positive impact on the maintenance and daily activities in theNational Park. Therefore, we can use this dam as an opportunity to launch a tourismcampaign and generate income from tourism-related business.

Impact of Climate ChangeArayat, the city surrounding Mt. Arayat floods frequently which disrupts tourism activi-ties and prevents visitors from traveling to the National Park. Just this year, Pampangaand Bulan and Metro Manila along with many other areas have received Storm WarningSignal 2 for Typhoon Hagupit [Interaksyon].

Risks and VulnerabilitiesThe Mt. Arayat National Park is in a condition of neglect and needs to be redone with

http://www.touristlink.com/philippines/mt-arayat-national-park/overview.html

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proper flood control measures. We anticipate that Mountainous areas can see occurrencesof flash flood and landslides warnings during the storm, and billboards and signage mayroll off due to winds. This will lead to a shutdown of the national park, and consequentlytourism activities.

AdaptationRenovating the Mt. Arayat National Park is beyond the range of this project, therefore,we need to ensure a stable and secure source of income to support the dam activities.First, we need to relocate the informal settlers and business establishments on the riverbanks. Fresh water supply for domestic and business activities through the dams watersupply will incentivize the move. Secondly, following this action, the Department of Pub-lic Works and Highways can approve a proposal and fund dam infrastructure to preventflooding.

3.4 Tailored Action Plan

The action plan for this adaptation component will be carried in the following order:

1. Relocation of settlers

2. Begin construction of the dam and reservoir

3. We plan to start with construction of the hydroelectric power plant.

4. Development of irrigation canals and water treatment plant.

We will work closely with the Global Facility for Disaster Reduction and Recovery toensure that our dam and other infrastructure meets the required safety implementationsand guidelines to protect against flooding, and associated climate change impacts. Wecan also sub-contract our work to the San Roque Power Corporation as they could fi-nance and construct the Dam under a power purchase agreement with the National powerCorporation on a Built Operate Transfer basis. [Export Credit Agencies Watch]

3.5 Gathering Support for Implementation

We plan to work with various groups representing Central Luzon resident, major indus-tries, political parties and central government. These groups all benefit from the imple-mentation of the dam and thus are the stakeholders in the project. One such agencyis the Department of Social Welfare and Development which deals with sectors such aswater supply, rural and inter urban roads and health. It also focuses on natural disastermanagement and risk mitigation. Their project National Community Driven DevelopmentProject empowers communities in targeted municipalities to achieve improved access toservices and to participate in more inclusive local planning, budgeting and implementa-tion [World Bank]. As part of our citizen outreach program, we shall encourage volunteeractivities and offer training to all community groups and political entities.

4 Broader Impacts

4.1 Ancillary Components of the Proposed Program

Phase-1 of the Pampanga Delta Development Project was plagued with issues. A lackof social cooperation was an important factor that prevented it from meeting its devel-

http://www.eca-watch.org/problems/asia pacific/philippines/sanroqueproject.html

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Figure 4: Gantt Chart of responsibilities and timelines

opmental goals. Further, there were also scheduling delays borne out of an inefficientland acquisition program, and the lack of sufficient funding. However, implementationof Phase-2, as stated by the Department of Public Works and Highways [Sun Star Pam-panga, 2013] is subject to the residents living in the proposed site of development movingto alternative sites offered in compensation.

The following proposals, therefore, attempt to addresses major problems faced by phase-1, in order to ensure optimal efficiency of operation:

• Implementation of citizen outreach programs aimed at facilitating discussion betweenthe provincial citizens and the people facing displacement. The primary issues thatprevented efficient land acquisition in phase-1, according to the previously citedsurvey carried out as part of the PDDP included complaints about the compen-sation offered, delayed construction of resettlement sites, holdups in compensationpayments, and a lack of capital to resettle at new sites. These citizen outreach pro-grams therefore, will seek to suitably address these issues, and develop a frameworkpertaining to compensation, prior to the implementation of the program.

• An eclectic review panel that consists of representatives of all stakeholders mustbe formed, with the objective of designing specifics of the project. This panel willalso be responsible for periodic review of project progress, while ensuring that allinterests are suitably represented.

4.2 External Benefits

The implementation of this program would have a number of non-quantifiable effects, someof which are as follows:

• Once constructed, the proposed dam and debris trap projects are likely to lead toincreased development with respect to built capital in the region. Infrastructuredevelopment, and investment typically leads to increased land prices, which wouldbenefit residents and land owners in the area.

http://www.sunstar.com.ph/pampanga/local-news/2013/11/11/pampanga-river-delta-all-clear-313140

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• Social benefits result from an increased sense of security among citizens affected bythe annual flooding.

• The exact quantified benefits resulting from the construction of the debris trap, andthe dam can be arrived upon using a complex cost-effectiveness model that is outsidethe gamut of this study. This, therefore, is a quantifiable characteristic, but has beensorted into this section for the reason mentioned above.

• Improved accessibility as a result of the proposed transportation systems.

4.3 Long Term Impacts

Long-term impacts of the proposed project are likely to span across a diverse spectrumof benefits, some of which have been stated below:

• A general improvement in the prosperity and welfare of the population of the area,resulting from factors such as higher levels of development.

• Greater funding for relief and rehabilitation work as a result of reduced long-terminvestment in damage mitigation.

• Improved sanitation and a corresponding decrease in epidemics of water borne dis-eases.

• The Mount Arayat National Park along with the proposed dam will attract a largenumber of tourists, which will in turn, lead to growing investment in the area.

5 Qualifications

Our team comprises of three engineers with varying specializations, thus offering acombination of strengths, required for the execution of this project.

Sham Thanekar completed his B.S. in Chemical Engineering, and M.S. in Civil andEnvironmental Engineering. His background in chemical engineering afforded the imple-mentation of the water treatment plant and the processes involved such as pre-chlorination,desalination and filtration. Saakshi Gupta completed her B.S. in Chemical Engineeringwith a minor in Business Administration. Following this, she graduated with a M.S. inEnergy Science, Technology and Policy with a concentration in Civil Engineering. As arecent graduate in Energy Science, she lent her energy management expertise to the in-stallation of a renewable hydroelectric energy source in the Central Luzon area. AdityaChaganti completed his B.S. in Civil and Environmental Engineering (CEE), and contin-ued on to complete his M.S. in both CEE and Engineering and Technology InnovationManagement (ETIM). His Civil engineering skill set allowed for calculations of the as-sociated parameters required for construction of the Arayat Dam. Furthermore, with adual degree in ETIM, Chaganti was able to apply the concepts of decision making underuncertainty, which is essential in this large-scale project. He was also able to effectivelyallocate resources to different infrastructure supporting the adaptation technique.

5.1 Groups

Academic Institutions, Industries and Non-profits to Partner with on this proposal:

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• Public Interest Research Group (PIRG) – A non-profit organization that promotesrenewable energy, energy efficiency and demand-side management in the Philippines.

• San Miguel Corporation (SMC) – This food beverage and packaging company isPhilippines largest corporation in terms of revenue. SMC has become involved inpower generation and infrastructure since 2008.

• Department of Tourism, Philippines

• Global Facility for Disaster Reduction and Recovery – committed to advance andscale up coordinated financial and technical assistance to disaster prone countries

• Water Environment Association of the Philippines – non profit organization estab-lished to provide professionals with the information and tools necessary to addressenvironmental protection in Philippines.

6 Budget

The following estimations were made, in order to build a Cost-Benefit Model to estimatethe feasibility of the project:

• Inflation Rate for all years prior to 2014 = 3%

• Discount Rate= 3%

• Cost of constructing the water treatment plant = 31Million(2014) (water-technology.net,2009, http://www.water-technology.net/projects/muntinlupa-plant/)

• Cost of constructing the irrigation system = $23 Million (2014 $)

• Cost of Construction of Dam = $ 1.3 Million (2014 $)

• Operation and Maintenance Costs were considered only for the hydraulic powergeneration component of the project. Values for this were taken from the U.S En-ergy Information Administration’s estimate of capital cost estimates for utility scaleelectricity generating plants. (U.S Energy Information Administration, April 2013)

The total capital costs, therefore are approximately equal to $56 Million.

Material costs are assumed to be 30% of this cost. This low estimate is by virtue of thefact that the proposed dam is an earth fill dam, and involves no significantly expensivematerials such as steel. Labor costs are assumed to be 10% of the total capital costs, whileland acquisition, permits, and compensations are assumed to cost about 60% of the totalproject cost.

• Therefore, material costs are approximately $17 Million

• Labor Costs are approximately $6 Million

• Permits, land acquisition and compensation are estimated to cost approximately $34Million.

http://www.eia.gov/forecasts/capitalcost/

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The cost benefit analysis is performed on these expenses, with a base year of 2014. Thesole source of revenue is the revenue from the hydroelectric power, which is charged at 13cents/kWh (The Philippine Star, April 2014, http://www.philstar.com/headlines/2014/04/09/1310530/electricity-rates-high-summer-demand)

A cost-benefit analysis over a 100 year timeframe exhibits a case of constantly dimin-ishing returns, leading to an NPV (2014) of approximately $60 Million.

Over this period, revenue accrued from power generation (the cost of the benefit), wasestimated to be approximately $27 Million.

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