Endesa Narrows in on Chile’s Puelo River

A new front appears to be opening in an ongoing struggle over the fate of Chile’s southern rivers. For more than a year now Spanish-owned electricity giant Endesa has been at the center of a major conflict over its plans to build four massive hydroelectric dams in Chile’s far southern Region XI, an area of Patagonia also known as Aysén.

Endesa’s partner in the so-called Aysén Project is Chilean firm Colbún. While the companies insist the project, slated for the Baker and Pascua Rivers, is a necessary step toward meeting Chile’s growing electricity needs, opponents say the proposed dams will be socially and environmentally devastating for the pristine region.

What began as a local movement against the proposed dams has since become a high-profile campaign attracting the attention of celebrities, politicians and even a pair of influential U.S. environmental groups: the Natural Resources Defense Council and more recently the Sierra Club.

But while the Aysén Project is certainly the most well known of Endesa’s controversial endeavors, it is by no means the only one. As a national debate continues to rage over whether or not the government should eventually approve the polemical project, Endesa is already beginning to lay the groundwork for yet another series of hydroelectric dams – this time along Region X’s Puelo River.

Last month, on Endesa’s behalf, a woman named Maria Teresa Cañas Pinochet – niece of Chile’s recently deceased former dictator Augusto Pinochet – filed more than 50 mining exploration petitions that together correspond to 12,600 hectares of land in the vicinity of the Puelo. The river, which begins in Argentina’s Lake Puelo and flows west, eventually depositing in the Pacific Ocean, happens to be Chile’s second most voluminous river, after the Baker River.

War Drums Against Endesa

The move has immediately put area environmentalists on alert. According to Mauricio Fierro of the Puerto Montt-based environmental group Geoaustral, in obtaining those exploration rights, Endesa is taking a classic step toward exerting control over the river valley.

"What normally happens in Chile with any project, whether it’s real estate development, or constructing a hotel or building, whatever, is that people ask first for a mining exploration right and later an exploitation right. Why? In order to have control over the property and so that no one can come and stop what you’re doing," says Fierro.

Not coincidentally, Cañas Pinochet filed similar mining petitions last year for territory in Aysén’s Baker and Pascua river valleys.

"It’s all based on something called the Mining Code…It’s the most important and powerful law that exists in Chile," says Fierro. "To put it simply, anyone who has those rights, who pays for the licenses, can enter on a property and look around, excavate, do whatever they want on the property. That’s why Endesa uses that method for taking control of properties."

Endesa’s interest in the powerful Puelo is nothing new. The company, which has held the river’s water rights since 1990, at one point contemplated building what would have been Chile’s largest dam and reservoir, a project so grand it would have dwarfed Region VIII’s Ralco dam. Currently the biggest in the country, the 690 MW-Ralco dam is also owned by Endesa.

Last year, however, the Spanish company hinted it now plans to construct one large dam and reservoir, plus two smaller "run-of-the-river" dams. The large, 320 MW-facility would dam the Puelo River and hold back an estimated 5,000-hectare reservoir. The smaller, non-reservoir dams would be built along the nearby Manso River. In total the project would produce roughly 720 MW and could cost as much as US$650 million.

Although the plans are still at a relatively early stage, Mauricio Fierro and other area activists have been quick to raise their objections.

"From here on there’s going to be a mounting battle against Endesa. And it’s going to be more complicated than Aysén… The war drums against Endesa are sounding," says Fierro.

We Can’t Pretend We’re Gods

For starters, the project would have tremendous environmental consequences on both sides of the border, say critics. As with all large-scale dam-reservoir complexes, the Puelo river project would involve large-scale flooding that in addition to displacing residents, would also drown native forests and permanently alter the area’s existing ecosystem.

The project could also affect Region X’s Reloncaví Sound, a large bay into which the Puelo River flows. According to Fierro, the river provides about 60 percent of Reloncaví’s oxygen. That oxygen, in turn, sustains the area’s lucrative aquaculture industry which, if the river is dammed, could suffer dramatically.

"If the flow is cut, who knows what could happen," says the environmentalist. "All the salmon and shellfish farms could disappear, because they wouldn’t have oxygen… Everything that’s down there could die."

The project has become quite a hot topic in neighboring Argentina as well. According to Alejandro Nebbia of the Argentine Network of Environmental Educators project, the project threatens to alter the climate on both sides of the border. Of particular concern is the proposed reservoir, a massive artificial lake that – through the natural evaporation process – will change nearby weather patterns and humidity levels.

"What you need to know is that this is a lake zone that has a certain average humidity and is home to many tree and bush species. All of that came about over the course of 60 million years and we can’t just come along, pretend we’re gods and from one day to the next put in a lake just like that," says Nebbia.

"This whole area, just like anywhere else in the world, is a system based on a delicate balance that’s very sensitive to any change. We’re not talking about chopping down a few trees. We’re talking about creating a 5,000-hectare lake that will put humidity levels, animal habitats, seed cycles, everything at risk."

Partnership Beyond the Border

In recent months environmental NGOs in Argentina – in partnership with Chilean groups like the Region XI-based Citizen Coalition for Aysén Life Reserve – have organized several forums on the issue, including one held this last weekend in the Argentine town of Los Antiguos. The seminars give participants an opportunity to air concerns not just about the Puelo River project, but also about threats posed to the area by mining ventures and other hydroelectric plans.

They also "spark as sense of solidarity with Chilean activists who face the difficult task of opposing these mega-projects that principally favor oil and mining interests operating on both sides of the mountains," says Lucas Chiappe, coordinator of an Argentine group called the Lemu Project.

"Corporations take all the benefits they want while the people look on without being able to share their opinions, let alone oppose this looting, which is organized in the Northern Hemisphere and implemented here thanks to the corrupt politicians that administer our shared property," he adds.

But can groups of Argentine activists really have an influence over projects being planned in Chile? Maybe.

Fifteen years ago Chile and Argentina signed a bilateral treaty that specifically addresses the issue of "shared waterways." According to the 1992 treaty, projects involving shared waterways must – before being allowed to proceed – be approved on both sides of the border.

"In the case of shared waterways," the treaty reads, "the use of water resources in the territory of one (of the two countries) must not in any way harm their shared water resources, a common waterway or the environment…The actions and projects involving the use of the shared water resources must be carried out in a coordinated or joint manner via general use plans."

Complicating matters even more for the hydroelectric project is that the area in question falls smack dab in the middle of territory Chile and Argentina are hoping to incorporate into South America’s first cross-border, UN-sponsored nature reserve.

In late March, Chilean authorities officially petitioned the United Nations Educational and Scientific Organization (UNESCO) to designate the area as a "Biosphere Reserve." UNESCO currently sponsors 507 such sites worldwide, including 11 in Argentina and eight in Chile. The proposed "Southern Andes Temperate Rainforests Biosphere," however, would be the first in the region to be shared by two countries.

It’s with those scenarios in mind that Patricia Ranea, a Rio Negro provincial legislator decided last week to speak out on the issue, calling on both local and national authorities to educate themselves on the subject.

"It is fundamental that first as a province and then as a national we be aware of these proposed projects and take concrete steps in order to avoid a repeat of the paper plants," she said.

The "paper plants" in this case refer to two massive pulp mills under construction on the Uruguayan side of the Plata River. The plants have been at the center of an unprecedented conflict between Argentina and Uruguay, which share the Plata. Argentina, complaining that the plants pose and environmental and public health threat, took the case to the International Court of Justice in The Hague.

Like the pulp plants, the Endesa project "could affect extremely vulnerable ecosystems on both sides. It’s an issue that goes beyond the border between the two countries," said Ranea.

"This is a difficult fight, but one be must undertake together. It’s not easy to face off against the interests and capital of companies that don’t take into account the damages they cause, only profits. It’s even more difficult when they have the support of a government, in this case the Chilean state," she added.

Contact Benjamin Witte  at benwitte@hotmail.com