China says Three Gorges Dam cost $37 billion

BEIJING, Sept 14 (Reuters) - China's Three Gorges Dam, including resettling the 1.3 million people it displaced, cost 254.2 billion yuan ($37.23 billion), the Xinhua news agency said on Monday, several times an original estimate.

The huge bill vindicates critics of the project, who warned it would come in well over budget. Other concerns about environmental and social disruptions have also been borne out over nearly 20 years since the project began.

When the project was formally approved in 1992, then-Vice Premier Zou Jiahua told China's parliament, the National People's Congress, that it would cost 57 billion yuan ($8.35 billion).

But the infrastructure, including a dam, a giant lock for carrying ships up and down river, and 26 power generators, had a final price tag of 184.9 billion yuan, state-run Xinhua quoted a senior government official overseeing the project as saying.

Finding new homes for people whose towns and villages were flooded cost an additional 69.3 billion yuan, added Lu Chun, deputy head of the office of the Three Gorges Project Construction Committee, which reports to China's cabinet.

China's leaders say the world's largest hydropower project will control once-deadly floods, power the development of a marginalised inland region, and cut emissions of pollutants and greenhouse gasses.

The dam was a lightening rod for critics of Beijing's growth model since economic reforms began three decades ago, with a focus on economic growth while concerns about environmental and social costs were sidelined.

When the blueprint for the dam's construction was sent to the country's usually rubber-stamp parliament for approval, one-third of the members voted against it or abstained, an unprecedented show of disapproval.

Critics have long warned that the dramatic reworking of local ecosystems could have unforeseen consequences, and there is considerable risk that the reservoir will become a cesspool of sewage and industrial pollutants, clogged by accumulating silt.

They were also concerned about the social impact of forcing so many people to leave their homes, potential for corruption with such a huge project, and the likelihood of escalating costs.

Worries about costs proved justified almost immediately.

By 1994 when then-Premier Li Peng broke ground on the project he had championed, the total bill was already estimated at over 100 billion yuan, according to the director of the Funding section of the Three Gorges Construction Committee, Luo Changmao.

After the dam wall was completed in 2006, Xinhua quoted the Three Gorges Project Corporation saying it had invested 131.3 billion yuan so far, and would keep the total cost within 180 billion yuan. ($1=6.828 Yuan) (Reporting by Emma Graham-Harrison; Editing by Lucy Hornby and Tomasz Janowski)