São Paulo, Brazil – Those passing by the London office of Brazil’s development bank, BNDES, on Wednesday would have seen an unusual protest.
A group of 50-60 Amazonian Indian tribal leaders, some in traditional dress, gathered outside the offices of BNDES to demonstrate against a proposed Amazon hydroelectric project that the bank is funding. They say the $11bn Belo Monte dam, which the new government of Dilma Rousseff, president, wants to build on the Xingu river – one of the Amazon’s biggest tributaries, will destroy their homes and livelihoods.
“We really see the battle of the Xingu river as very symbolic,” said Atossa Soltani, founder and executive director of Amazon Watch, a US-based activist group fighting the dam. “Unless the Dilma administration is challenged on Belo Monte, what we’re going to be seeing over the next four years is dozens of licences being issued for dams in the Amazon.”
Opponents of Belo Monte, who include Hollywood figures such as James Cameron, director of Avatar, and celebrities such as Bianca Jagger, won the latest round in the fight last week when a judge in a Brazilian federal court in Para, the state where the dam is being built, ordered a halt to construction until the project’s developers met environmental conditions.
But most expect the lull in the battle to be temporary. Slated to be the world’s third biggest hydroelectric facility, Belo Monte is one of the flagship projects of Ms Rousseff’s government, a keystone of her growth acceleration programme, an ambitious plan to build hundreds of billions of dollars of new infrastructure projects to sustain the rise of Brazil’s economy. “In order for the Brazilian economy to grow around 5 per cent per year in the next few years, Brazil needs to add 5,000 megawatts per year to its installed capacity,” says Mauricio Tolmasquim, of the Brazilian government’s Energy Research Company.
In terms of sheer size, Belo Monte would deliver this and more. The 11,200MW dam would help maintain Brazil’s standing as one of the few large economies that are powered by sustainable energy.
Brazil’s power comes 90 per cent from renewable sources compared with 18 per cent for the world average, according to Mr Tolmasquim.
The US emits 200 times more greenhouse gases than Brazil and China 190 times, he says.
Environmentalists, however, argue that Belo Monte will be far more destructive and less productive than the government claims.
First conceived more than 30 years ago, the project was revived and put to tender last year. It ran into trouble when Odebrecht and Camargo Corrêa, two of Brazil’s biggest construction companies, pulled out of the race, saying the upper limit on tariffs set by the government of R$83 ($50) per megawatt hour was too low to be commercially viable.
Norte Energia, a consortium led by Brazilian state-controlled power utility Eletrobrás, won the tender.
Protesters argue that Belo Monte will destroy the livelihoods of people living beside the Xingu. It will flood 516 sq km (201 sq miles) and will lower the river’s level as it passes between two indigenous reservations.
The dam could also suffer from irregular rainfall, such as the drought presently afflicting the Amazon. Opponents say it will only be able to produce at full capacity for three months of the year. The government should build smaller, less disruptive hydroelectric projects, they say.
Mr Tolmasquim said Belo Monte would generate about 40 per cent of capacity – below Brazil’s average of 55 per cent. But he said this was because of environmental concerns.
Environmentalists are also worried the project will attract nearly 100,000 outsiders – migrant workers and their families, which will lead to conflict with indigenous communities.
The government counters that the investors are planning to provide $3.3bn as “social and environmental compensation” in the area.
Environmental challenges to the project are routine and are often quickly overturned. But both the government and Norte Energia, which declined to comment on the ruling, know that more important will be to win the case in the court of public opinion – in Brazil and overseas.
