Comments on Changuinola 1 (Chan 75) Large Hydro Project (Panama)
August 11, 2008
Comments on the CDM Project Design Document (PDD) for the AES Changuinola I (a.k.a. Chan 75) Large Hydroelectric Dam Project: A Case of “Greenwash Additionality”
Submitted by International Rivers to the project validator TÜV SÜD
August 8, 2008
Project Overview:
- Location: Changuinola River, La Amistad UNESCO Biosphere Reserve Buffer Zone and Mesoamerican Biological Corridor, Panama
- Type: 222 MW; 99m concrete dam; 1394 ha reservoir.
- Project Promoter: AES Corporation
- Social impacts: Include forced displacement of more than 1000 Ngobe indigenous people and harm to livelihoods of 4000 more. Because of the dam the Ngobe have suffered beatings, arbitrary detention, public humiliation, threats and illegal destruction of crops and homes at the hands of the police and AES.
- Environmental impacts: Destruction of riverine and forest ecosystems in one of the world’s biodiversity hotspots. The dam is expected to have severely negative impacts on fish and shrimp biodiversity by blocking migrations between the San San Wetlands Ramsar site and the UNESCO World Heritage Site La Amistad International Park (shared with Costa Rica).
- Status: Under construction. Land clearing started 2005. Subject to numerous ongoing court cases, repression of local communities, and criticism from United Nations Special Rapporteur on human rights and indigenous people.
- Additionality Status: Non-additional in terms of how CDM “additionality” is normally understood (i.e. that the prospect of CDM registration was necessary for the project to go forward). However the project could be considered as a case of a new form of additionality: “greenwash additionality.” Validation by TÜV-SUD and registration by the CDM could harm local community and environmentalist efforts to stop the project and protect local communities by providing apparent UN support for the project.
- Quality of PDD: PDD contains numerous fraudulent claims, in particularon project additionality and the strong opposition from local indigenous communities. No mention is made of the intimidation and other repressive tactics used against local communities, the legal irregularities in the project approval process, or the numerous legal challenges against the project.
- Impact of validating the project: Vindication of repression against local communities and fraud in CDM documents. Could set back legal and political campaigns to stop the project.
- Estimated generation: 1047 GWh/yr
- Claimed “emission reductions”: 669,000 tCO2/year (4,683,000 tCO2 over 7 years)
Further comments on project additionality
“Investment Barrier”
AES announced that they would build the dam on the basis of a 10-year power purchase agreement with utility, Union Fenosa, at a meeting with Panama’s President Martin Torrijos on January 26, 2006. Full-scale construction started in 2007. Andres Gluski, president of AES Latin America, told President Torrijos that the dam would “provide a . . . low cost source of electricity for Panama.”
It is inconceivable that AES would have entered a legal contract to supply electricity and committed a $320 million investment if this would only be economically viable if at some point in the future the dam would be issued credits by the CDM. This is especially true given AES experience of its application to the CDM for the Bayano Hydro Expansion Project in Panama. This application was first made in 2001 and is still waiting for validation. (The Bayano Expansion has long since been completed regardless of its not receiving CER income). AES also unsuccessfully tried to get CDM registration for its Bujagali dam in Uganda in 2002. (Although AES is no longer involved the dam is now under construction despite not receiving CER income).
The PDD claims that the Minutes from an AES Board of Directors meeting in October 2006 “demonstrates that the incentive to develop the project activity as a CDM [sic] was considered and played an important role in the decision to go ahead with the project.” This is irrelevant in terms of proving additionality. To be additional the CDM must essential to the decision to develop the project, not just an “important” factor which was “considered.” Given that AES is well aware of CDM rules, and stands to gain revenues of around $70m (@$15/CER) overseven years if they get CDM registration, it would indeed be surprising if their board did not consider how much they would like to get CDM registration. It would even be somewhat surprising if the $70m was not a sufficient inducement for the board to say that the CDM was essential for the project to go ahead regardless of the reality. The CDM process is predicated upon independent evaluation of developer claims, not just taking developers at their word. In any case confidential minutes should not be eligible to be used in CDM validation processes which must be open to public scrutiny.
“Prevailing Practice Barrier”
AES makes the absurd claim that “under a business as usual scenario hydroelectric technology would not be implemented in Panama.” In reality, hydropower has long supplied the majority of Panama’s electricity. In 2004 hydropower contributed 56% of the country’s installed capacity. The list of “recent hydropower projects in Panama” given in the PDD includes only one hydropower plant commissioned since 1984 and conveniently fails to list AES’s Bayano expansion project, or numerous other hydro projects that are under construction or recently completed. It omits the two other dams for which AES has received concessions on the Changuinola River, the highly controversial Bonyic hydro project, and the 87 hydro projects that have been approved by, or are seeking approval from, Panama’s DNA (CDM authority).
“Barrier due to Project’s Sensitive Location”
This is the one area where the project may indeed be additional. The project is being built in a supposedly protected area and on the lands of an indigenous community which is strongly opposed to the project. This opposition has been manifested in numerous political actions such as the blockading of the road to the construction site in December 2007 and January 2008, as well as a number of domestic and international legal actions (the struggle against the dam is referred to in the PDD only as a “significant discussion”).
One of the more shockingly deceitful claims made by AES in the PDD is that “95% of the population in the region approves the project.” The only evidence given for this claim is a newspaper clipping quoting the leader of an “astroturf” (false grassroots) organization set up and funded by AES to promote their dams and discredit genuine environmental and community organizations. This is typical of the dirty tricks used by AES to promote the dam.
It may be the case that if the Changuinola I dam is registered by the CDM this will give the appearance of UN approval for the project’s “clean” credentials. This could assist AES and the Panamanian government (majority shareholders in AES Panama) to defeat the political and legal challenges to the dam and ensure its completion. This is the only form of additionality – let us call it “greenwash additionality” – for the project which is at all credible.
This “greenwash additionality” is totally unacceptable and contrary to the spirit of the CDM. The CDM is not supposed to help unscrupulous and dishonest developers to steamroller environmentally and socially destructive projects against the wishes of local people or to interfere in ongoing legal processes and petitions. If TÜV-SUD validates this project it will be colluding in the human rights abuses and environmental destruction being caused by Changuinola 1 and the dishonest practices of AES.
The AES PDD claims that the dam “follows the recommendations” of the World Commission on Dams. This is a risible claim. The dam is in breach of numerous essential aspects of the WCD, most importantly perhaps the requirement to gain the “free, prior informed consent” of indigenous people. Clearly AES have paid lip service to the WCD in the hope that this will help ensure that CERs from Changuinola I will be eligible to be used in the European Trading System (which requires WCD compliance).
Proper Consultation and Research
To be legitimate, TÜV-SUD’s validation process must include interviews with stakeholders other than AES and allied groups and the Panamanian government. These stakeholders should include at a minimum Ngobe community leaders, their legal advisors, Panamanian environmental and human rights organizations including ACD, the UN Special Rapporteur on human rights and indigenous people, and members of the UNESCO delegation who visiting the area in January 2008 to assess the request for the La Amistad International Park to be listed as a World Heritage Site in Danger. A validation report based only on discussions with dam supporters would be non-credible and totally unacceptable.
Further reading for TÜV-SUD
“International Rivers Comments on Proposed CDM Methodology for Bayano Large Hydro Expansion (Panama)” http://www.internationalrivers.org/en/node/1331
“Changuinola 75 Hydroelectric facility, Panama”
http://www.power-technology.com/projects/changuinola75/
“AES To Build 150 MW Hydroelectric Plant with Long Term Contract in Panama; Company to Add a Total of 940 MW to Its Global Fleet, Business Wire, Jan 26, 2006 http://findarticles.com/p/articles/mi_m0EIN/is_2006_Jan_26/ai_n26738004
Sarah Cordero et al. “Análisis de costo beneficio de cuatro proyectos hidroelélectricos en la cuenca Changuinola-Teribe.” ACD/Asociación ANAI/CSF, July 2006 http://conservation-strategy.org/files/Changuinola%20FINAL.pdf
Ellen L. Lutz “Dam Nation.” Cultural Survival Quarterly, Winter 2007. “Letter of the Ngobe People affected by Dam Chan 75 of the Company AES Changuinola.” International Indian Treaty Council, March 2008 http://www.treatycouncil.org/document_9111112121211211.htm
Jeffrey D. Stein, “Resistance to Dam Nation: An Analysis of the Stance and Strategies of the Opposition Movement to the Chan-75 Hydroelectric Project in Bocas del Toro, Panama.” BA thesis, Wesleyan University, Connecticut, April 2008.
Jessica Barber, “Paradigms and Perceptions: A Chronology and Analysis fo the Events of the Chan-75 Hydroelectric Project and the Roles and Relationships of Participants.” SIT Panama: Conservation and Development, May 2008.
More information:
Dams Threaten Biodiversity and Indigenous People in Panama
International Rivers Comments on CDM Methodology for Bayano Large Hydro Dam Expansion (Panama)
Contact us:
Patrick McCully
patrick@internationalrivers.org
+1 510 848 1155
Thanks for sharing that!
We need more information on this matter. Things aren’t what they look like
There has been plenty of information put out on this matter. Check out all the links provided in this blog, for instance. In addition, for a look at international views of what is occurring on the Changuinola River, see the following:
InterAmerican Commission on Human Rights – http://www.cidh.org/medidas/2009.eng.htm
World Heritage Committee – http://mensual.prensa.com/mensual/contenido/2009/07/02/hoy/panorama/1839799.asp
AES Panama is the largest power generator in Panama—and growing. Its four hydroelectric power plants—Bayano, Estí, La Estrella and Los Valles—comprise 36% of the total installed generation capacity of the country. Adding to its current capacity, AES began construction of a new hydroelectric facility in 2006—called Changuinola. Once it reaches commercial operation, expected in 2011, this facility will add another 233 MW to AES Panama’s installed capacity.
AES Panama embraces social responsibility to the communities neighboring its installations. Akua Yala, a community of approximately 200 members of the Kuna tribe within the Bayano Hydroelectric Basin, received basic electricity and water services for the first time thanks to AES Panama’s rural electrification efforts. The project constructed an electrical distribution line and a rural potable water treatment plant, greatly improving the quality of life for this indigenous community.
For an alternate view of what these dams are doing, please see the InterAmerican Commission on Human Rights’ June 18, 2009 decision with regards to Chan-75.
http://www.cidh.org/medidas/2009.eng.htm
A real opinion from a resident…
Hello, My Name is Abel Miranda and I am an resident and also a Ngobe and I want all of you to join our group in facebook called ABIA YALA, PACHA MAMA http://www.facebook.com/group.php?gid=129496360760
Thank You so much…
Abel Miranda
Panamanian Ambientalist
Mr. Miranda, all development should be geared to helping the people who live immediately in the area of development. However, hydroelectric projects traditionally employ very few local people, once construction is completed. Which village are you from? Is it one of the villages which has sought assistance from the international community to stop these dams? Please see the decision of the InterAmerican Commission on Human Rights:
PM 56/08—Ngöbe Indigenous Communities et al., Panama
On June 18, 2009, the IACHR granted precautionary measures for members of the indigenous communities of the Ngöbe people, who live along the Changuinola River in the province of Bocas del Toro, Panama. The request for precautionary measures alleges that in May 2007, a 20-year concession was approved for a company to build hydroelectric dams along the Teribe-Changuinola River, in a 6,215-hectare area within the Palo Seco protected forest. It adds that one of the dams authorized to be built is the Chan-75, which has been under construction since January 2008 and which would flood the area in which four Ngöbe indigenous communities have been established—Charco la Pava, Valle del Rey, Guayabal, and Changuinola Arriba—with a population of approximately 1,000 people. Another 4,000 Ngöbe people would also be affected by the construction of the dam. They allege that the lands affected by the dam are part of their ancestral territory and are used to carry out their traditional hunting and fishing activities. The Inter-American Commission believed that precautionary measures should be granted to avoid irreparable harm to the right to property and security of the Ngöbe indigenous people in the province of Bocas del Toro. The IACHR requested that the State of Panama suspend construction and other activities related to the concession until the bodies of the inter-American human rights system can adopt a final decision on the matter raised in Petition 286/08, which alleges violations of the rights protected under Articles 5, 7, 8, 13, 19, 21, 23, and 25 of the American Convention on Human Rights. The IACHR also asked the State of Panama to adopt the measures necessary to guarantee the free circulation as well as the life and physical integrity of the members of the Ngöbe community, in order to prevent acts of violence or intimidation measures.
http://www.cidh.org/medidas/2009.eng.htm
Interesting facts there, Marc.
Things are starting to develop and the Panamanian state is permanently concerned with the full compliance with its international commitments and specially development of low-cost hydroelectric generating.
It’s a project of national interest.
Funny you should mention that. This is not the finding of the InterAmerican Commission on Human Rights or of the World Heritage Committee.
Please see: http://www.cidh.org/medidas/2009.eng.htm
See also: http://mensual.prensa.com/mensual/contenido/2009/07/02/hoy/panorama/1839799.asp
I recently read that Panama’s asking the Human Rights Interamerican Comission to revoke their decision.
A Ministry of Foreign Affairs’ statement informs that Panama can’t comply with their requirements since their taking to consideration information that’s more than a year old.
Please post the cite where you read this. The fact that information is a year old does nothing to take away from its validity, nor does it necessarily demonstrate that the information is not current.
I have in front of me a map of the province of Chiriqui which is dotted by over 50 hydroelectric dams, proposed or under construction. This is sheer insanity!
As an anthropologist and Panamanian residing in the USA, I would like more information on the big picture prior to writing several articles on the issue.
Some Panamanian informants have been providing me with information, some of it very alarming. For example, that in the construction of one dam, a man was killed by an explosion, but the death was covered up by company officials saying it was the blood and tissue of a dog.
Thank you very much for your kind attention,
B.J.Perez