CHILE: Hydropower Plans Paddle On Against the Current

The Chilean government has granted Endesa, a Spanish corporation, permission to carry out exploratory studies in the south of the country for the purpose of building four hydroelectric plants, in a move opposed by environmentalists, who are planning several demonstrations.

"We expected this to happen. The system works in favour of transnational companies," Marco Díaz, president of the Group of Defenders of the Spirit of Patagonia, told IPS from Cochrane, a city 2,000 kilometres south of Santiago in the Aysén region.

This is where Endesa Chile , the local subsidiary of the Spanish corporation, plans to build the four hydropower stations, investing some three billion dollars, in partnership with the Chilean Colbún firm, owned by the powerful Matte family.

The Aysén Hydroelectric Project is to be built on the Baker River -- Chile's largest in terms of water flow -- and the Pascua River, flooding 10,000 hectares of virgin land, destroying several wetlands and affecting the habitat of endangered wildlife species, say critics.

After studying Endesa's application and the 120 legal challenges to the project presented by the community, the Superintendency of Electricity and Fuels (SEC) decided to grant the company a temporary concession (for two years), authorising Endesa to have recourse to local courts of justice if the owners of lands bordering the rivers deny entry to its workers.

But this permit can only be used for exploratory measurements, the SEC told IPS, and does not mean that the dams have been authorised.

The hydropower plants are to generate 2,400 megawatts for the central grid, which serves the most populous area of Chile , covering nine of its 13 regions.

Although the Office of the Comptroller General must still recognise SEC's decree, environmentalists believe it is a strong signal that Endesa's project will ultimately go ahead.

The next steps are to obtain a definitive concession from the Ministry of the Interior, and to present an environmental impact study to the Aysén Regional Environment Commission (Corema), which must then be submitted to the national environmental authority (Conama).

"We believe that the only way to stop this project is through mass demonstrations by ordinary citizens. In Santiago and other regions of the country, different groups that oppose the Aysén power stations are mobilising. We don't trust the government," Díaz said.

A similar position is taken by Juan Pablo Orrego, the director of the non-governmental Ecosistemas, who told IPS that there had been irregularities in the process of obtaining the concession and that the SEC "used their administrative discretion in favour of Endesa."

The objections from the community were probably not taken into account "because they were related to the environment, and this agency (SEC) acts from a purely technical point of view," government sources explained.

"The SEC says: 'we're not involved in environmental aspects, we're not involved in social issues,' and they are largely justified by their legal regulations, which were approved during the military dictatorship (1973-1990). But in practice they are laying the foundations for the Aysén hydroelectric project, which does affect environmental and social issues," Orrego retorted.

"Ever since the dictatorship, Chile has been in a checkmate situation, legally, institutionally, politically and financially," that gives power to private enterprise and takes it away from ordinary people, he added.

For its part, the SEC states that the spirit of its actions is as much for the protection of individual people's interests as for energy development in the country.

Díaz said that so far, Endesa has gained entry to more than half the properties in the area, having obtained the permission of the residents. But environmentalists allege that people's consent was obtained in an irregular manner.

In the next few days a further complaint will be made in the courts, alleging the company's workers trespassed on a 600-hectare property, and drilled "six holes, five metres in diameter each," without permission.

The activists also have doubts about the good intentions of the company, which announced the start of environmental studies for the project some weeks ago. They will examine terrestrial and aquatic flora and fauna, the living conditions of the population and the cultural heritage of Aysén.

According to its website, Endesa has already tendered and adjudicated the research work to prestigious Chilean universities, and has hired the well-known auditor PricewaterhouseCoopers to certify the reports.

Orrego is certain that, if the studies turn out to be unfavourable to the hydroelectric project, the company will interpret the data in its favour, and will find loopholes to get its own way, for instance proposing "mitigation measures" for any predicted social or environmental impacts.

Several environmental organisations held a demonstration for water nationalisation in the centre of Santiago on Jun. 24, over environmental conflicts affecting important river basins.

Because of their possible consequences on water resources, Endesa's plans for dams in Aysén, the Pascua Lama mining project (in the northern Atacama region), and the pulp and paper mills at Nueva Aldea (in the south-central Bío-Bío region) and Arauco and Constitución (in the southern Los Lagos region) have all been called into question.

The Group of Defenders of the Spirit of Patagonia is organising a big horseback protest for next November, riding from the city of Cochrane to Coyhaique, a distance of 345 kilometres, over the space of two weeks. On arriving at Coyhaique they will deliver a letter of protest to the regional governor.

"The country is coming to a boil, in a spontaneous social movement, and that's where our hope lies," Orrego said.

Endesa has scheduled the start of construction of the first power station for 2008, to be brought onstream in 2012. The fourth and last is scheduled for 2018.

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• 187 Privatization