Inter Press Service » Integration and Development Brazilian-style http://www.ipsnews.net News and Views from the Global South Tue, 23 Aug 2016 13:22:26 +0000 en-US hourly 1 http://wordpress.org/?v=4.1.12 Olympic Games End Decade of Giant Mega-projects in Brazilhttp://www.ipsnews.net/2016/08/olympic-games-end-decade-of-giant-mega-projects-in-brazil/?utm_source=rss&utm_medium=rss&utm_campaign=olympic-games-end-decade-of-giant-mega-projects-in-brazil http://www.ipsnews.net/2016/08/olympic-games-end-decade-of-giant-mega-projects-in-brazil/#comments Wed, 03 Aug 2016 17:28:35 +0000 Mario Osava http://www.ipsnews.net/?p=146383 Modern office buildings and stores, all empty, are among the “white elephants” in the city of Itaboraí, near Rio de Janeiro, left by an aborted petrochemical and oil refinery complex in southeast Brazil. Credit: Mario Osava/IPS

Modern office buildings and stores, all empty, are among the “white elephants” in the city of Itaboraí, near Rio de Janeiro, left by an aborted petrochemical and oil refinery complex in southeast Brazil. Credit: Mario Osava/IPS

By Mario Osava
RIO DE JANEIRO , Aug 3 2016 (IPS)

An era of mega-events and mega-projects is coming to a close in Brazil with the Olympic Games to be hosted Aug. 5-21 by Rio de Janeiro. But the country’s taste for massive construction undertakings helped fuel the economic and political crisis that has it in its grip.

It is no mere coincidence that President Dilma Rousseff, suspended during her ongoing impeachment trial over charges of breaking budgetary regulations, will face the final vote in the Senate this same month.

Over the past decade, large-scale investment projects and public works, some not yet finished, others even abandoned, have driven the economy, triggered controversies, and fed the dreams and frustrations of Brazilians, mirroring and accelerating the rise and fall from power of the left-wing Workers’ Party (PT).

The country’s economic growth and the international prestige of then-president Luiz Inácio Lula da Silva (2003-2011) played a decisive role in the 2007 choice of Brazil as host of the 2014 FIFA World Cup.

Two years later, Rio de Janeiro was selected as the venue for the 2016 Olympic Games.

In 2007 Rio hosted the Pan American Games, which kicked off the string of sports mega-events in Brazil, including the FIFA Confederations Cup in 2013.

The wave of mega-infrastructure projects also began at the same time, in response to the needs of the energy and transportation industries, mainly for the export of mining and agricultural commodities.

Large hydropower dams, railways, ports, the paving of roads and the diversion of the São Francisco River to ease drought in the arid Northeast, as well as numerous public works in cities, formed part of the Growth Acceleration Programme (PAC), which included tax breaks and credit facilities.

Rousseff, who also belongs to the PT, succeeded Lula in the presidency after an election campaign in which she was referred to as “the mother of PAC” – an allusion to her skill in implementing and managing the programme that involved thousands of construction projects around the country, as Lula’s chief of staff.

In the oil industry, the 2006 discovery of enormous offshore petroleum deposits below a two-kilometre thick salt layer under rock, sand and deep water in the Atlantic prompted the launch of another major wave of construction, including four large refineries, two petrochemical complexes, and dozens of shipyards to produce oil drilling rigs, offshore platforms and tankers.

The two biggest refineries, in the Northeast, were cancelled in 2015, resulting in some 800 million dollars in losses. Another is partially operating.

Work on the last one – and on the petrochemical complex of which it forms part, near Rio de Janeiro – was interrupted, leaving empty a number of office buildings and hotels that were built in surrounding towns and cities to service an industrial boom and prosperity that never arrived.

The Belo Monte hydroelectric plant’s turbine room in the northern Brazilian state of Pará, under construction in 2015. The mega-project is to be finished in 2019. Credit: Mario Osava/IPS

The Belo Monte hydroelectric plant’s turbine room in the northern Brazilian state of Pará, under construction in 2015. The mega-project is to be finished in 2019. Credit: Mario Osava/IPS

Most of the shipyards went under or shrunk to a minimum. In Niterói, Rio de Janeiro’s sister city, half of the 10 shipyards closed and over 80 percent of their 15,000 workers were laid off.

Possibly the house of cards of this fast-track development would have come tumbling down regardless, but several destructive factors compounded the problem and accelerated the approach of the disaster.

Oil prices plunged in 2014, simultaneously with the outbreak of the Petrobras bribery scandal that has ensnared hundreds of legislators and business executives.

In addition, the governments of Lula and Rousseff attempted to curb inflation by blocking domestic fuel price increases – another blow to the finances of Petrobras, the state oil company, which almost collapsed under the weight of so many difficulties.

The railways did not fare any better. Construction of two railroads – one private and another public – designed to cross the impoverished but fast-growing Northeast at different latitudes ground to a halt and are candidates to become white elephants due to the suspension of mining industry projects, whose output they were to transport.

As a result, the construction of a new seaport and the expansion of two others were also suspended. 

At least the hydroelectric plants are in the process of being completed. But they are suffering the ups and downs of the power industry. There are delays in the installation of power lines and electricity consumption has slumped as a result of the economic recession that broke out in 2014, expanding spare capacity and driving up losses in power generation and distribution plants.

The four largest hydropower plants, built on fragile rivers in the Amazon rainforest, are facing accusations of causing environmental damage and violating the rights of local populations: indigenous people, riverbank dwellers and fishing communities.

Belo Monte, the world’s third-largest hydroelectric dam, with a capacity to generate 11,233 MW, was accused of “ethnocidal actions” against indigenous people by the public prosecutor’s office and is facing 23 lawsuits on charges of failing to live up to legal requirements.

At the same time, it is also criticised by proponents of hydropower, because it will generate, on average, only 40 percent of its potential. With a relatively small reservoir, an alternative that was chosen to reduce the environmental impact, it will be at the mercy of the marked seasonal variations in water flow in the Xingú River, where the flow is 20 times lower in the dry season than the rainy season.

Roads have not formed part of the recent wave of mega-projects. Although they are being paved and widened, they were originally built in earlier waves of construction projects, in the 1950s and 1970s.

Brazil’s addiction to massive construction projects was probably born with the emergence of Brasilia, built in a remote, inhospitable location over 1,500 km from the biggest cities, São Paulo and Rio de Janeiro, in just five years, during the administration of Juscelino Kubitschek (1956-1961).

This bold feat was completed with the construction of roads running from the new capital in all directions.

But these long roads that cut across the country didn’t become paved highways, with proper bridges, until decades later.

Seen as a success story, Brasilia has prompted politicians to seek to make their mark with major construction projects, although the city was only part of the broader plan of Kubitschek, who pushed forward the development of Brazil’s steel industry by spurring the growth of the automotive industry.

The widespread belief that Brasilia was the big driver of settlement and development of the west and north of the country ignores the role played by the expansion of agriculture.

The 1964-1985 military dictatorship later fed the ambition of turning Brazil into a great power, with a nuclear programme that took three decades to build two power plants, the construction of two of the world’s five biggest hydroelectric plants, and roads to settle the Amazon.

The Trans-Amazonian highway, which was designed to cut across northern Brazil to the Colombian border but is incomplete and impassable for large stretches during the rainy season, is a symbol of failed lavish projects that helped bring down the dictatorship.

The origins of the megalomania can also be traced to the 1950 FIFA World Cup, for which the Maracana Stadium was built in Rio de Janeiro – for decades the largest in the world – holding held up to 180,000 spectators back then, more than double its current capacity.

The historic defeat that Brazil suffered at the hands of Uruguay in the final match in 1950, a devastating blow never forgotten by Brazilians, did not keep this country from hosting the 2014 World Cup, building new stadiums to suffer yet another shattering defeat, this time to Germany, which beat them 7-1 in the semi-finals.

Now, in the grip of an economic crisis expected to last for years, Brazil is unlikely to embark on new megaprojects. And the hope that they can drive development will have been dampened after so many failed projects and the heavy environmental, social and economic criticism and resistance.

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Lessons from Germany for Latin America’s Energy Transitionhttp://www.ipsnews.net/2016/08/lessons-from-germany-for-latin-americas-energy-transition/?utm_source=rss&utm_medium=rss&utm_campaign=lessons-from-germany-for-latin-americas-energy-transition http://www.ipsnews.net/2016/08/lessons-from-germany-for-latin-americas-energy-transition/#comments Mon, 01 Aug 2016 20:02:13 +0000 Emilio Godoy http://www.ipsnews.net/?p=146344 A house with solar panels on the roof in a town in North Rhine-Westphalia in Germany - a common sight in this European nation, but still rare in many countries of Latin America. Credit: Emilio Godoy/IPS

A house with solar panels on the roof in a town in North Rhine-Westphalia in Germany - a common sight in this European nation, but still rare in many countries of Latin America. Credit: Emilio Godoy/IPS

By Emilio Godoy
DÜSSELDORF, Germany, Aug 1 2016 (IPS)

Germany has been undergoing an energy transition for over 20 years, and it can offer valuable lessons to Latin America with regard to promoting renewable energy and moving towards a low-carbon economy.

Germany’s transformation formally began in 2011, based on six laws that foment alternative energies through a surcharge for suppliers, the expansion of the power grid to boost the incorporation of renewables, and cogeneration, to use energy that goes to waste in power plants that run on fossil fuels.

There are twice as many laws that bolster the generation and consumption of renewable sources worldwide as there were at the start of the century, and Latin America is no exception to this trend.

“Other countries, including those of Latin America, should probably look at Germany’s experiences and learn from both the good and the bad,” Sascha Samadi, an analyst with the German Wuppertal Institute for Climate, Environment and Energy, which carries out research on the energy transformation, told IPS.

The expert said that “at the start of the energy transition, everything was about how to rise up against the big energy companies that so many people hated,” while now the main driver of support for the transition is concern about climate change.

To move towards a low-carbon energy mix, “in the countries of Latin America, other aspects can be more important on the agenda, such as reducing dependence on imports or making supplies more stable,” he said.

In Germany, renewables accounted for 30 percent of the electricity produced in 2015 and this European nation is the third-largest producer of renewable energy – not including hydropower. It is third in wind energy and biodiesel and fifth in geothermal.

It is also a leader in per capita solar power, despite its relatively low amount of sunlight.

In the last decade, strides have been made in developing renewable energies in Latin America, a region highly dependent on fossil fuels, either because the countries are major producers of them, such as Argentina, Brazil, Colombia, Ecuador, Mexico, Peru and Venezuela, or because they depend on imports, like the nations of Central America or Chile.

Most countries in the region have included plans to foment the energy transition, policies to make production and consumption more efficient, and targets for the generation of renewable energy.

Reaching Germany’s goal, a low-carbon economy, requires social change and modifications in consumption patterns and industrial policies, and will force plants like the ThyssenKrupp steel mill in the city of Duisburg to replace coal with cleaner sources. Credit: Emilio Godoy/IPS

Reaching Germany’s goal, a low-carbon economy, requires social change and modifications in consumption patterns and industrial policies, and will force plants like the ThyssenKrupp steel mill in the city of Duisburg to replace coal with cleaner sources. Credit: Emilio Godoy/IPS

For example, Mexico passed in December an energy transition law, Chile has its 2050 energy plan, and Uruguay has a 2005-2030 energy policy. This legislation includes medium to long-term goals for the generation of renewable energy, tax incentives, and other actions aimed at a cleaner energy mix.

In 2015, Brazil drew more than 7.1 billion dollars in investment in renewables – 10 percent less than the previous year; Mexico drew 4.0 billion – double the 2014 level; and Chile, 3.4 billion – an increase of 150 percent, according to the report “Global Trends in Renewable Energy Investment 2016”.

Nations like Honduras and Uruguay also received over 500 million dollars in investment in renewables in 2015, according to the study produced by the United Nations Environment Programme Collaborating Centre for Climate and Sustainable Energy Finance at the Frankfurt School of Finance & Management.

The study reports that investment in Brazil climbed from 800 million dollars in 2004 to 7.1 billion in 2015.

Without counting the region’s leading producer, Latin America captured 1.7 billion in investment in 2004, rising to 12.8 billion in 2015. But last year’s capital flows fell from 2014 levels, due to factors such as political instability in some countries and low oil prices.

The region generates 209,419 MW of renewable energy, of which hydropower represents 171,960.

To promote a low-carbon energy mix, there is an element in which Latin America should try to emulate Germany, Sophia Schönborn, an analyst with the German multisectoral organisation on energy KlimaDiskurs.NRW e.V, told IPS.

“Germany’s transition shows the importance of bottom-up decision-making and listening to the public’s concerns. It was not imposed; society pushed for changes in the energy model,” said the expert.

In the hands of the market

Germany has reached the point where it is producing excess renewable energy. As a result, parliament revoked fixed rates for renewables as of January 2017, and created auctions for all sources of clean energy.

The reform of the renewable energy law that will go into effect at that time rewards suppliers that have the lowest prices, sets caps on energy generation, and leaves fixed rates in place only for cooperatives and small-scale producers.

Germany’s energy transition has included facilities for wind and solar power generated by cooperatives and private citizens, such as the innovative bioenergy park in Saerbeck, in the state of North Rhine-Westphalia. Credit: Emilio Godoy/IPS

Germany’s energy transition has included facilities for wind and solar power generated by cooperatives and private citizens, such as the innovative bioenergy park in Saerbeck, in the state of North Rhine-Westphalia. Credit: Emilio Godoy/IPS

Under the German model, citizens can generate their own electricity, and can even sell it to the grid, as part of the construction of what experts and organisations are referring to as the “energy citizenship”. But that is far from being the reality in Latin America.

The fixed rates, which included a surcharge to support suppliers of renewables, helped fuel the expansion of alternative sources in Germany.

In Latin America, countries such as Ecuador, Honduras, Panama, Peru and Uruguay use surcharges or mix them with net metering, which allows consumers who produce their own electricity to use it at any time, rather than when it is generated. The consumers only pay the difference between what they consume and what they generate.

And countries like Chile, Mexico and Peru have put in place renewable energy auctions since 2015, which have led to a drop in prices per kilowatt-hour, partly due to their vast renewable sources, according to the Global Status Report 2016 released in June by REN21, the Renewable Energy Policy Network for the 21st Century.

According to experts, the recent swings are a signal to Latin America with respect to the handling of the renewable energy market, to avoid risks of over-production or excessive payments to suppliers.

Samadi stressed that “the costs of the expansion of renewables are paid by consumers in Germany.”

“This might not be a good mechanism for the countries of Latin America, where low energy prices could be important for social development and cohesion,” he said. With this in mind, he suggested taxes or special funds.

There is another lesson too. “If the huge growth in renewables was just starting now in Germany, with today’s low technological costs our overruns for generation would be lower than what we pay now.”

In his view, “the countries that start to invest heavily today in wind and solar energies will not face the same high costs as Germany, especially when the solar potential in most of Latin America is taken into account.”

Schönborn concurred, stressing the competitive costs of renewable sources. But she warned of the risk of “social division” for those who cannot generate their own energy and must buy it from the grid.

This inequality “requires intervention by the state to guarantee access,” she said.

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No Medals for Sanitation at Rio Olympicshttp://www.ipsnews.net/2016/07/no-medals-for-sanitation-at-rio-olympics/?utm_source=rss&utm_medium=rss&utm_campaign=no-medals-for-sanitation-at-rio-olympics http://www.ipsnews.net/2016/07/no-medals-for-sanitation-at-rio-olympics/#comments Wed, 27 Jul 2016 19:24:11 +0000 Mario Osava http://www.ipsnews.net/?p=146273 Raw sewage stains in Jacarepaguá lagoon alongside the Olympic Park, where the Olympic Games are to be held August 5-21 in the Brazilian city of Rio de Janeiro. Foul mud was to be dredged from the lagoon but this was not carried out because of funding cuts. Credit: Courtesy of Mario Moscatelli

Raw sewage stains in Jacarepaguá lagoon alongside the Olympic Park, where the Olympic Games are to be held August 5-21 in the Brazilian city of Rio de Janeiro. Foul mud was to be dredged from the lagoon but this was not carried out because of funding cuts. Credit: Courtesy of Mario Moscatelli

By Mario Osava
RIO DE JANEIRO, Jul 27 2016 (IPS)

The biggest frustration at the Olympic Games, to be inaugurated in the Brazilian city of Rio de Janeiro on August 5, is the failure to meet environmental sanitation targets and promises in the city’s beaches, rivers, lakes and lagoons.

The opportunity to give a decisive push to the clean up of Rio’s emblematic Guanabara bay and its lagoons has been lost. The drive against waterborne pollution was part of the proposal which won the city the right to host the 2016 Summer Olympics.

This failure may hardly register in the awareness of residents and visitors, given the higher visibility of the urban transport projects and the revitalisation of Rio’s central district.

What happened confirms the national tradition of giving sanitation low priority on the government agenda. So far only half the Brazilian population has access to piped water, and only a small proportion of transported water is treated.

“The environment pays no taxes and neither does it vote, therefore it does not command the attention of our political leaders nor of society as a whole,” complained biologist Mario Moscatelli, a well known water issues activist in Rio de Janeiro.

The Olympic Park, which is at the heart of the Games of the XXXI Olympiad, was built on the west side of the city on the shores of Jacarepaguá lagoon, yet not even this body of water has been adequately treated. Filthy water from rivers and streams continues to flow into it all the time, Moscatelli told IPS.

Most of the foreign Olympic athletes and spectators from abroad will arrive in Rio at Antonio Carlos Jobim international airport, also known as Galeão. Planes touch down here on the edge of one of the most polluted parts of Guanabara bay, although visitors may not realise it.

The airport , on the western tip of Ilha do Governador (Governador Island), which was home to 212,754 people in 2010 according to the official census, is close to canals  taking untreated effluent and rubbish from millions of people living on the mainland, brought by rivers that are little more than open sewers.

Fundão canal can be glimpsed from the southbound highway towards the city centre. It is full of raw sewage and bad smells in spite of recent dredging, because it is still connected to the polluted Cunha canal.

Sergio Souza dos Santos stands on the jetty built by Tubiacanga fisherfolk to get their boats out into Guanabara bay, in the Brazilian city of Rio de Janeiro. Silting now makes it impossible to bring their boats close inshore, where decades ago there was a beautiful beach. Credit: Mario Osava/IPS

Sergio Souza dos Santos stands on the jetty built by Tubiacanga fisherfolk to get their boats out into Guanabara bay, in the Brazilian city of Rio de Janeiro. Silting now makes it impossible to bring their boats close inshore, where decades ago there was a beautiful beach. Credit: Mario Osava/IPS

Five rivers converge in the Cunha canal after crossing densely populated areas including several “favelas” (shanty towns) and industrial zones.

North of Galeao airport, the fishing village of Tubiacanga illustrates the ecological disaster in Guanabara bay, which has a surface area of 412 square kilometres and stretches from Copacabana beach in the west to Itaipu (Niterói) in the east.

At the narrowest point in the channel between Ilha do Governador and the adjacent mainland city of Duque de Caxias, “there used to be a depth of seven or eight metres; but now at low tide you can walk along with the water only chest-high,” 66-year-old Souza, who has lived in Tubiacanga for two-thirds of his life, told IPS.

Landfills, silting by rivers and rubbish tipping have all reduced the depth of the bay, he said.

“Tubiacanga is at a meeting point of dirty water from tides rising at the bay entrance, from several canals including Fundão, and from rivers. Sediments and rubbish pile up in front of our village,” where the white sandy beach has become a quagmire and rubbish dump over the past few decades, Souza complained.

Guanabara bay receives 90 tonnes daily of rubbish and 18,000 litres per second of untreated waste water, mainly via the 55 rivers and canals that flow into it, according to Sergio Ricardo de Lima, an ecologist and founder of the Bahia Viva (Living Bay) movement.

Rio’s Olympic bid announced a target of cleaning up 80 percent of the effluents reaching the bay. The actual proportion achieved was 55 percent, Sports Minister Leonardo Picciani said at a press conference with foreign journalists on July 7.

“I only believe in what I see: out of the 55 rivers in the basin, 49 have become lifeless sewers,” said Moscatelli, voicing the scepticism of environmentalists.

The 80 percent target was not realistic; completely decontaminating the bay would require 25 to 30 years and sanitation investments equivalent to six billion dollars, André Correa, environment secretary for the state of Rio de Janeiro, admitted on July 20 at the inauguration of an “eco barrier” on the river Merití, one of the polluting waterways.

Once this was a white sandy beach close to the fishing village of Tubiacanga, in Guanabara bay, near Rio de Janeiro international airport. The city’s population contributes to pollution and silting in this emblematic Brazilian bay. Credit: Mario Osava/IPS

Once this was a white sandy beach close to the fishing village of Tubiacanga, in Guanabara bay, near Rio de Janeiro international airport. The city’s population contributes to pollution and silting in this emblematic Brazilian bay. Credit: Mario Osava/IPS

The barriers are floating interconnected booms that are an emergency measure to ensure that aquatic Olympic sports can take place in some parts in the bay. Trash scooping vessels or “eco boats”  collect the floating debris that accumulates against them and send it for recycling.

Seventeen eco barriers have been promised, but these will be woefully inadequate, and in any case they should be anchored where floating garbage is most concentrated, like Tubiacanga, not close to the Guanabara bay entrance where water sports will be held, Lima complained.

The barrier in the Merití river is suitably placed, in Lima’s view, but it is “palliative action only.” The real solution is to promote selective garbage collection at source, that is, in households, shops and industries, and recycle as much solid waste as possible, as stipulated by a 2010 law.

“At present only one percent of the garbage produced in the Rio de Janeiro Metropolitan Region (which has a population of 12 million) is recycled,” Lima said.

Cleaning up Guanabara bay is a longstanding ambition. It was the goal of a project begun in 1995 that has already cost the equivalent of three billion dollars at the current exchange rate, but that has not prevented environmental deterioration of local beaches and water resources.

Eight wastewater treatment stations were built or expanded to improve water quality. However, they have always operated well below capacity, because the main drains needed to collect wastewater and deliver it to the treatment stations have never been built, according to Lima.

Pollution of the bay is exacerbated by oil spills. There is a refinery and petrochemical hub on the banks of the lagoon in Duque de Caxias; in addition, all along the Tubiacanga waterfront the bay is increasingly crisscrossed by pipes carrying crude oil, refinery subproducts and natural gas.

The effects of a large oil spill in January 2000 are still felt today. It had a direct impact on Tubiacanga and on the fish catch.

“We fisherfolk are the ones who suffer most from the consequences of pollution, and who best know the bay; but we are not listened to, we are penned in and threatened with extinction,” said Souza dos Santos, who is encouraging his four sons to take up trades other than fishing.

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Germany’s Energy Transition: The Good, the Bad and the Uglyhttp://www.ipsnews.net/2016/07/germanys-energy-transition-the-good-the-bad-and-the-ugly/?utm_source=rss&utm_medium=rss&utm_campaign=germanys-energy-transition-the-good-the-bad-and-the-ugly http://www.ipsnews.net/2016/07/germanys-energy-transition-the-good-the-bad-and-the-ugly/#comments Tue, 19 Jul 2016 12:19:42 +0000 Emilio Godoy http://www.ipsnews.net/?p=146128 In Germany, wind and solar energy coexist with energy generated by burning fossil fuels. A wind farm next to one of the electric power plants fired by lignite in the Western state of North Rhine-Westphalia. Credit: Emilio Godoy/IPS

In Germany, wind and solar energy coexist with energy generated by burning fossil fuels. A wind farm next to one of the electric power plants fired by lignite in the Western state of North Rhine-Westphalia. Credit: Emilio Godoy/IPS

By Emilio Godoy
COLOGNE, Germany, Jul 19 2016 (IPS)

Immerath, 90 km away from the German city of Cologne, has become a ghost town. The local church bells no longer ring and no children are seen in the streets riding their bicycles. Its former residents have even carried off their dead from its cemetery.

Expansion of Garzweiler, an open-pit lignite mine, has led to the town’s remaining residents being relocated to New Immerath, several kilometres away from the original town site, in North Rhine-Westphalia, whose biggest city is Cologne.

The fate of this small village, which in 2015 was home to 70 people, reflects the advances, retreats and contradictions of the world-renowned transition to renewable energy in Germany.

Since 2011, Germany has implemented a comprehensive energy transition policy, backed by a broad political consensus, seeking to make steps towards a low-carbon economy. This has encouraged the generation and consumption of alternative energy sources.

But so far these policies have not facilitated the release from the country’s industry based on coal and lignite, a highly polluting fossil fuel.

“The initial phases of the energy transition have been successful so far, with strong growth in renewables, broad public support for the idea of the transition and major medium and long term goals for government,” told IPS analyst Sascha Samadi of the non-governmental Wuppertal Institute, devoted to studies on energy transformation.

Renewable electricity generation accounted for 30 percent of the total of Germany’s electrical power in 2015, while lignite fuelled 24 percent, coal 18 percent, nuclear energy 14 percent, gas 8.8 percent and other sources the rest.

This European country is the third world power in renewable energies – excluding hydropower – and holds third place in wind power and biodiesel and fifth place in geothermal power.

Germany is also renowned for having the highest solar power capacity per capita in photovoltaic technology, even though its climate is not the most suitable for that purpose.

But the persistence of fossil fuels casts a shadow on this green energy matrix.

“The successful phasing out of fossil fuels entails a great deal of planning and organisation. If we do not promote renewables, we will have to import energy at some point,” Johannes Remmel, the minister for climate protection and the environment for North Rhine-Westphalia, told IPS.

Germany has nine lignite mines operating in three regions. Combined, the mines employ 16,000 people, produce 170 million tonnes of lignite a year and have combined reserves of three billion tonnes. China, Greece and Poland are other large world producers of lignite.

A part of the Garzweiler open-pit lignite mine, in North Rhine-Westphalia. One of the greatest challenges facing the energy transition in Germany is the future of this polluting fuel. Credit: Emilio Godoy/IPS

A part of the Garzweiler open-pit lignite mine, in North Rhine-Westphalia. One of the greatest challenges facing the energy transition in Germany is the future of this polluting fuel. Credit: Emilio Godoy/IPS

Garzweiler, which is owned by the private company RWE, produces 35 million tonnes of lignite a year. From a distance it is possible to see its cut-out terraces and blackened soil, waiting for giant steel jaws to devour it and start to separate the lignite.

Lignite from this mine fuels nearby electricity generators at Frimmersdorf, Neurath, Niederaussen and Weisweiller, some of the most polluting power plants in Germany.

RWE is one of the four main power generation companies in Germany, together with E.ON, EnBW and Swedish-based Vattenfall.

Coal has an expiry date

The fate of coal is different. The government has already decided that its demise will be in 2018, when the two mines that are still currently active will cease to operate.

The Rhine watershed, comprising North Rhine-Westphalia together with other states, has traditionally been the hub of Germany’s industry. Mining and its consumers are an aftermath of that world, whose rattling is interspersed with the emergence of a decarbonized economy.

A tour of the mine and the adjoining power plant of  Ibberbüren in North Rhine-Westphalia shows the struggle between two models that still coexist.

In the mine compound, underground mouths splutter the coal that feeds the hungry plant at a pace of 157 kilowatt-hour per tonne.

In 2015 the mine produced 6.2 million tonnes of extracted coal, an amount projected to be reduced to 3.6 million tonnes this year and next, and to further drop to 2.9 million in 2018.

The mine employs 1,600 people and has a 300,000 tonne inventory which needs to be sold by 2018.

“I am a miner, and I am very much attached to my job. I speak on behalf of my co-workers. It is hard to close it down. There is a feeling of sadness, we are attending our own funeral”, told IPS the manager of the mine operator, Hubert Hüls.

Before the energy transition policy was in place, laws that promoted renewable energies had been passed in 1991 and 2000, with measures such as a special royalty fee included in electricity tariffs paid to generators that are fuelled by renewable energy sources.

The renewable energy sector invests some 20 billion dollars yearly and employs around 370.000 people.

Another measure, adopted in 2015 by the government in Berlin, sets out an auction plan for the purchase of photovoltaic solar power, but opponents have argued that large generation companies are being favoured over small ones as the successful bidder will be the one offering the lowest price.

Energy transition and climate change

Energy transition also seeks to meet Germany’s global warming mitigation commitments.

Germany has undertaken to reduce its greenhouse gas emissions by 40 per cent in 2020 and by 95 per cent in 2015. Moreover, it has set itself the goal of increasing the share of renewable energies in the end-use power market from the current figure of 12 per cent to 60 per cent in 2050.

In the second half of the year, the German government will analyse the drafting of the 2050 Climate Action Plan, which envisages actions towards reducing by half the amount of emissions from the power sector and a fossil fuel phase-out programme.

In 2014, Germany reduced its emissions by 346 million tonnes of carbon dioxide, equivalent to 27.7 per cent of the 1990 total. However, the German Federal Agency for Environment warned that in 2015 emissions went up by six million tonnes, amounting to 0.7 per cent, reaching a total of 908 million tonnes.

Polluting gases are derived mainly from the generation and use of energy, transport and agriculture.

In 2019, the government will review the current incentives for the development of renewable energies and will seek to make adjustments aimed at fostering the sector.

Meanwhile, Germany’s last three nuclear power plants will cease operation in 2022. However, Garzweiler mine will continue to operate until 2045.

“There are technological, infrastructure, investment, political, social and innovation challenges to overcome. Recent decisions taken by the government are indicative of a lack of political will to undertake the tough decisions that are required for deep decarbonisation”, pointed out Samadi.

Companies “now try to mitigate the damage and leave the search for solutions in the hands of the (central) government. There will be fierce debate over how to expand renewable energies. The process may be slowed but not halted”, pointed out academic Heinz-J Bontrup, of the state University of Applied Sciences Gelsenkirchen.

Meanwhile, the regional government has opted to reduce the Garzweiler mine extension plan, leaving 400 million tonnes of lignite underground.

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Uruguay Seeks Future as Oil Producer in Ultra-Deep Watershttp://www.ipsnews.net/2016/06/uruguay-seeks-future-as-oil-producer-in-ultra-deep-waters/?utm_source=rss&utm_medium=rss&utm_campaign=uruguay-seeks-future-as-oil-producer-in-ultra-deep-waters http://www.ipsnews.net/2016/06/uruguay-seeks-future-as-oil-producer-in-ultra-deep-waters/#comments Thu, 09 Jun 2016 20:19:31 +0000 Veronica Firme http://www.ipsnews.net/?p=145553 The Maersk Venturer drillship, which is drilling the Raya-1 well that set a new world record in terms of water depth, and will determine the existence of commercially viable oil and gas reserves on Uruguay's continental shelf. Credit: Ancap

The Maersk Venturer drillship, which is drilling the Raya-1 well that set a new world record in terms of water depth, and will determine the existence of commercially viable oil and gas reserves on Uruguay's continental shelf. Credit: Ancap

By Veronica Firme
MONTEVIDEO, Jun 9 2016 (IPS)

Uruguay is just weeks away from finding out if it will have a chance to stop being totally reliant on oil imports at some point in the future, when the first offshore exploration well in national waters – which set a new world record in terms of water depth – is completed.

Since Mar. 30, the consortium headed by France’s Total has been prospecting 250 km from the Atlantic coast, in more than 3,400 metres of water, and 3,000 metres below the seabed.

The Raya-1 well in Block 14, drilled with an investment of some 200 million dollars in ultra-deep waters on the continental shelf, is hunting for commercially viable oil or gas reserves.

On Thursday Jun. 8, the representative of Total in the country, Artur Nunes da Silva, said the drilling would be done in about two weeks and the samples would be sent to France for analysis. Only then, he said, would the results be announced.

The next day, the local media reported that, according to information from the industry, only water was found in Raya-1, although that did not fully rule out the existence of oil and gas on the continental shelf.

The drilling represents a major turning-point for this South American country of 3.4 million people, because it will soon know if it has a future as an oil producer. The effort to find oil here was not stalled by the oil-price crisis, which has discouraged investment at a global level, especially in high-risk ventures such as deepwater drilling.

“When the current drop in prices began, most of the contracts had already been signed,” Víctor Bacchetta, a journalist who specialises in environmental issues and who edits Uruguay’s Mining Observatory publication, told IPS.

The contracts form part of the goals set by the Ministry of Industry, Energy and Mining’s 2005-2030 energy policy, which, although it puts a priority on strengthening renewable energies, also paves the way for exploration and prospecting for oil and natural gas.

The state oil company Ancap is responsible for implementing the policy, which also requires attempts at participating in joint ventures for exploring deposits in other countries.

Geologist Ethel Morales told IPS that the first attempts to find fossil fuels in Uruguay dated back to the 1950s, when exploratory wells were drilled in the Northern Basin, which covers some 90,000 sq km in this country of 176,220 sq km.

A screenshot from a presentation by geologist Ethel Morales, showing the contracts granted so far on Uruguay's continental shelf, to the right. The second from the top is Block 14, awarded to French oil major Total. Credit: Uruguay Round

A screenshot from a presentation by geologist Ethel Morales, showing the contracts granted so far on Uruguay’s continental shelf, to the right. The second from the top is Block 14, awarded to French oil major Total. Credit: Uruguay Round

Exploratory wells were also drilled on the continental shelf in the 1970s, said Morales, a professor at Uruguay’s University of the Republic. But shallow water prospecting ended in 1976, after two wells were declared dry.

Besides the energy policy itself, Morales said another factor that fuelled offshore exploration was the appearance of the so-called pre-salt deposits, located beneath a two-kilometre-thick salt layer under rock, sand and deep water, to the north of this country’s continental shelf, off the coast of Brazil.

These huge deposits drew the oil corporations’ attention to the South Atlantic. Morales said Brazil’s Santos basin, where the pre-salt deposits are located, and the Uruguayan basin “share the same origins,” although their later evolution was different.

In this context, Ancap began to search for partners to drill exploratory wells in Uruguayan waters, although its spokespersons stress that the chances of finding commercially viable reserves stand at just 15 percent.

Uruguayan Minister of Industry, Energy and Mining Carolina Cosse (3rd-left) with high-level officials from the state oil company Ancap, during their visit to the drillship that is exploring for oil in ultra-deep waters 250 km off the coast of Uruguay. Credit: Ancap

Uruguayan Minister of Industry, Energy and Mining Carolina Cosse (3rd-left) with high-level officials from the state oil company Ancap, during their visit to the drillship that is exploring for oil in ultra-deep waters 250 km off the coast of Uruguay. Credit: Ancap

The Uruguay Round 1 bidding process was launched in 2009, offering continental shelf blocks, followed in 2011 by Round 2, in which eight contracts were signed, including the one with Total.

“Up to 2012 there was no 3D (tridimensional) seismic, and now we have nearly 40,000 sq km covered in the area of greatest prospectivity, which reflects a quantitative and qualitative leap with respect to the information available,” Ancap reported in late 2015.

Oil industry analysts stress the participation in the exploration here of the world’s leading oil companies, and note that the contracts assign a large proportion of the profits to the Uruguayan state.

Ancap and the Ministry of Industry decided to launch Uruguay Round 3, whose chief aim is the same: to determine whether there is oil and gas on the continental shelf, and if there is, whether it is commercially viable.

Total’s partners in Block 14 are the U.S. ExxonMobil (which has a 35 percent share) and Norway’s Statoil (15 percent), and the state will take 70 percent of the earnings, if the presence of light crude reserves is confirmed.

But even if the results from Raya-1 are positive, between two and three dozen additional wells will have to be drilled in the 6,900-sq-km block, and some six billion dollars will have to be invested if there is mainly oil, and 20 billion if there is mainly gas.

It could take up to six years before the start of commercial production of oil or gas, according to Total.

The oil companies granted contracts in the two bidding rounds held so far have invested a combined total of up to one billion dollars in exploration and prospecting.

The most important thing, in Ancap’s view, is that “after a period of nearly 30 years with no exploration” for fossil fuels, the oil companies are interested in investing in Uruguay, at their own expense and risk.

Edited by Estrella Gutiérrez/Translated by Stephanie Wildes

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The Waves of the Pacific Are on Chile’s Energy Horizonhttp://www.ipsnews.net/2016/05/the-waves-of-the-pacific-are-on-chiles-energy-horizon/?utm_source=rss&utm_medium=rss&utm_campaign=the-waves-of-the-pacific-are-on-chiles-energy-horizon http://www.ipsnews.net/2016/05/the-waves-of-the-pacific-are-on-chiles-energy-horizon/#comments Wed, 04 May 2016 16:21:32 +0000 Marianela Jarroud and Orlando Milesi http://www.ipsnews.net/?p=144960 http://www.ipsnews.net/2016/05/the-waves-of-the-pacific-are-on-chiles-energy-horizon/feed/ 1 Maquilas Help Drive Industrialisation in Paraguayhttp://www.ipsnews.net/2016/04/maquilas-help-drive-industrialisation-in-paraguay/?utm_source=rss&utm_medium=rss&utm_campaign=maquilas-help-drive-industrialisation-in-paraguay http://www.ipsnews.net/2016/04/maquilas-help-drive-industrialisation-in-paraguay/#comments Sat, 16 Apr 2016 01:59:21 +0000 Mario Osava http://www.ipsnews.net/?p=144645 Texcin, the garment plant built by Brazilian company Riachuelo near the airport in Asunción, under Paraguay’s maquila law, which offers tax exemptions and other incentives for export-oriented production. In the foreground a garment worker in training (“entrenamiento”). Credit: Mario Osava/IPS

Texcin, the garment plant built by Brazilian company Riachuelo near the airport in Asunción, under Paraguay’s maquila law, which offers tax exemptions and other incentives for export-oriented production. In the foreground a garment worker in training (“entrenamiento”). Credit: Mario Osava/IPS

By Mario Osava
ASUNCION, Apr 16 2016 (IPS)

“There were cases of people who stopped coming to work after receiving their first wages and then came back a few days later to ask if there was more work,” because they were used to casual work in the informal economy, said Ivonne Ginard.

Ginard, a human resources manager in the textile firm Texcin, was in charge of hiring the plant’s 353 employees and helping them make the transition from informal labour to working in a factory with set schedules, uniforms, safety measures and medical certificates to justify absences.

Texcin, a garment factory near the Asunción airport, is emblematic of the incipient industrialisation process in Paraguay, which is still an agriculture-based economy, where soy and beef are the main exports and informal employment is predominant in the cities.

The plant is a joint venture between members of the Paraguayan business community and Riachuelo, one of the biggest clothing brands in Brazil, where it has 285 stores and two industrial plants. Riachuelo decided to take advantage of the incentives provided by the law on maquila export plants, in effect in Paraguay since 2000, to produce clothing in this neighbouring South American country instead of importing from Asia.

The aim is to increase the number of workers twofold by the end of 2016 and to continue to expand, since the company has the space to build a new plant.

“Paraguay offers abundant, young, easily trained workers, cheap energy, and tax incentives for maquilas and duty-free zones, which make it possible to import raw materials tariff-free,” said Andrés Guynn, one of the Paraguayan partners, who heads Texcin.

“Our production is competitive with costs similar to those of Asia, with a big advantage in terms of time: it takes 90 days for products to be shipped from China to Brazil, while ours get to (the Brazilian city of) São Paulo in 72 hours, by truck,” he said.

“Under the maquila regime, 108 companies set up shop in Paraguay, 62 of them in the last two years, and 80 percent of them come from Brazil,” the director of the maquila sector in the Ministry of Industry and Trade, Ernesto Paredes, told IPS.

Maquila or maquiladora plants are built by foreign corporations, generally in free trade zones. They import materials and equipment duty-free for assembly or manufacturing for re-export, and enjoy other tax breaks and incentives, as well as more flexible labour conditions.

Texcin human resources manager Ivonne Ginard (right), next to the woman who trains the garment workers, Rosa Prieto. “Texcin changed my life,” said Prieto, who was a self-employed seamstress in the informal sector of the economy for 15 years, before she was hired by the company in January 2015. Credit: Mario Osava/IPS

Texcin human resources manager Ivonne Ginard (right), next to the woman who trains the garment workers, Rosa Prieto. “Texcin changed my life,” said Prieto, who was a self-employed seamstress in the informal sector of the economy for 15 years, before she was hired by the company in January 2015. Credit: Mario Osava/IPS

“The maquiladora industry is dynamic, but it does not accept trade union freedom, it does not allow unions to be organised in its factories, which violates constitutional rights,” the president of the Confederation of the Working Class (CCT) labour federation, Julio López, told IPS.

Auto parts factories are predominant in the industry, in terms of both revenue and jobs generated by maquiladoras in Paraguay, Paredes said. He said the sector uses the “just-in-time” delivery system developed by Japan’s auto industry, which is an inventory strategy employed to boost efficiency and reduce waste by receiving goods only as they are needed in the production process, which cuts inventory costs.

The Japanese company Yasaki and Germany’s Leoni have recently set up plants in Paraguay, employing thousands of people, nearly all of them women, in the production of electrical car cables.

And Paraguay now has its first car assembly plant. A national company, Reimplex, began to assemble J2 cars for Chinese auto maker JAC Motors on the outskirts of Asunción on Mar. 28.

Clothing factories also employ large numbers of women.

In addition, the plastics industry is expanding fast in the eastern department of Alto Paraná, on the border with Brazil, Paredes said.

Cheap local labour, which he said is “low-cost not so much because of the wages paid, but due to the low social charges” and low taxes, are especially attractive for Brazilian companies. To that is added the cost of electricity, which is 63 percent cheaper than in Brazil, according to the head of the maquila sector.

One limitation is transport and energy infrastructure. “Roads, ports, highways, real estate – all of this is lacking, although Paraguay has been investing heavily in airports, hotels, and office buildings,” he said.

One solution would be to widen the two-lane highway between Asunción and Ciudad del Este, the country’s two main economic hubs. However, the plan is not to expand the existing road, but “to build a second highway exclusively for trucks and trade,” as well as a second bridge to Brazil, said Paredes.

Texcin’s textile warehouse seen behind a sign announcing the expansion of the plant which was built by Brazilian company Riachuelo with partners in Paraguay on the outskirts of Asunción. Credit: Mario Osava/IPS

Texcin’s textile warehouse seen behind a sign announcing the expansion of the plant which was built by Brazilian company Riachuelo with partners in Paraguay on the outskirts of Asunción. Credit: Mario Osava/IPS

Investment is also needed in another route for the transportation of heavy loads, the Paraguay-Paraná waterway, used to export soy.

“Better signalisation would double its capacity and speed up river traffic,” Gustavo Rojas, a researcher at the Center for Economic Analysis and Dissemination in Paraguay (CADEP), told IPS.

This land-locked country of 6.8 million people has the world’s third-largest river barge fleet, as well as shipyards that build them, which favours an increase in river traffic, Paredes said.

Electricity is, potentially, Paraguay’s biggest comparative advantage, since the country owns half of the energy from two huge hydropower dams: Itaipú, shared with Brazil, and Yacyretá, on the border with Argentina, with the capacity to produce 14,000 and 3,200 MW, respectively.

But it only began to use part of that energy when a power line from Itaipú to Villa Hayes, near Asunción, was completed in October 2013. The power line was financed by a Brazilian fund aimed at narrowing the development gap between countries in the Southern Common Market (Mercosur) trade bloc, made up of Argentina, Brazil, Paraguay, Uruguay and Venezuela.

Without an adequate distribution network, however, the new energy supply did not eliminate problems like the February blackout that left 300,000 homes without power in Greater Asunción.

Achieving a more secure energy supply “is a question of time,” said Guynn, who tried to place his company near the new power line.

The problem is that the national power utility, ANDE, does not have investment capacity, and “distribution is not secure and steady,” said Fernando Masi, founding director of CADEP, which carries out research on public policies and provides graduate studies in economy.

But the broad availability of energy is a new element drawing industries to Paraguay, since the other advantages, such as low labour costs and tax incentives, already existed before.

Cheap energy also tempted the British-Australian multinational metals and mining corporation Rio Tinto, which studied the possibility of producing aluminum in Paraguay, even if it had to ship in the raw material, bauxite, from far away, because electric power is the main cost of the aluminum industry.

But a major public campaign, which collected more than 100,000 signatures, managed to block the project, “which would consume more energy than all of the national industries combined,” while requiring subsidies and employing a relatively small number of people, Mercedes Canese, an engineer who was deputy minister of industry during the government of Fernando Lugo (2008-2012), told IPS.

However, another engineer, Francisco Scorza, who studied the case, said the Rio Tinto project became unviable because “China began to produce very cheap aluminum, at 1,200 dollars a ton, 40 percent less expensive than here, and Paraguay can’t afford to subsidise energy.”

CADEP’s Masi said attracting small and medium-sized industries is better for development and employment, but the maquila sector has limits. The auto parts industry, for example, is limited to producing wiring, “because there is no bilateral agreement with Brazil on the car industry,” he said.

Brazil demands that Paraguay stop imports of used automobiles, “a very high cost for Paraguay to pay,” as it has a large fleet of used Japanese vehicles known as the “Vía Chile” cars because they come into Paraguay through that neighbouring country.

The maquila industry only exported 284 million dollars worth of goods in 2015 – very little in comparison to Paraguay’s overall industrial exports of 3.0 to 3.5 billion dollars, said Masi.

Industrialisation in Paraguay “has taken off, but not at the fast pace that was expected,” he said, adding that improving energy and logistics infrastructure could help.

Edited by Estrella Gutiérrez/Translated by Stephanie Wildes

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Interoceanic Canal Bogged Down in Nicaraguahttp://www.ipsnews.net/2016/04/interoceanic-canal-bogged-down-in-nicaragua/?utm_source=rss&utm_medium=rss&utm_campaign=interoceanic-canal-bogged-down-in-nicaragua http://www.ipsnews.net/2016/04/interoceanic-canal-bogged-down-in-nicaragua/#comments Fri, 08 Apr 2016 23:58:54 +0000 Jose Adan Silva http://www.ipsnews.net/?p=144534 http://www.ipsnews.net/2016/04/interoceanic-canal-bogged-down-in-nicaragua/feed/ 1 Agroindustry Provides Jobs, Better Living Standards in Paraguayhttp://www.ipsnews.net/2016/03/agroindustry-provides-jobs-better-living-standards-in-paraguay/?utm_source=rss&utm_medium=rss&utm_campaign=agroindustry-provides-jobs-better-living-standards-in-paraguay http://www.ipsnews.net/2016/03/agroindustry-provides-jobs-better-living-standards-in-paraguay/#comments Sat, 26 Mar 2016 01:51:14 +0000 Mario Osava http://www.ipsnews.net/?p=144364 Chemical engineer Negumi Kosaka has been training for over a year, learning to manage each stage of the production of soybean oil and soymeal in the Angostura Agroindustrial Complex (CAIASA) in the industrial park in Villeta, Paraguay. Her parents, Japanese immigrants, grow soybeans in another region in this country, which is taking steps towards industrialisation with projects like this one. Credit: Mario Osava/IPS

Chemical engineer Negumi Kosaka has been training for over a year, learning to manage each stage of the production of soybean oil and soymeal in the Angostura Agroindustrial Complex (CAIASA) in the industrial park in Villeta, Paraguay. Her parents, Japanese immigrants, grow soybeans in another region in this country, which is taking steps towards industrialisation with projects like this one. Credit: Mario Osava/IPS

By Mario Osava
VILLETA, Paraguay , Mar 26 2016 (IPS)

“I worked in many companies, in construction, fertilisers, chemicals, but none of them were as good as this one,” said Dario Cardozo, who works in the Angostura Agroindustrial Complex (CAIASA) grain reception facility.

The way he is treated by the owners and managers – “very educated people” – the better wages and the good working environment are the advantages stressed by the 32-year-old father of two – a veteran among the young people who work with him receiving and monitoring the trucks that come from the Paraguayan countryside laden with soybeans to be turned into oil and soymeal.

“We’re the face of CAIASA,” he told IPS, describing his job at the entrance to the complex, the biggest soybean crushing plant in Paraguay. Keeping things moving quickly as 500 trucks – the average traffic during harvest season – a day come in to unload their cargo is an important task, he said, because “for truckers, time is gold.”

Hired by the company after the plant began to operate in 2013 in Angostura, he has been able to build a house in a new neighbourhood of Villeta, where the plant is located in the industrial park on the banks of the Paraguay river. The home is modest, and unfinished: it still needs plaster and paint.

“We used to live with my father-in-law, but he died,” said Cardozo’s wife Lourdes Ramírez, who is happy about the health insurance and other benefits offered by CAIASA. “The bus brings my husband to the two-lane avenue” a few hundreds of metres away, “but when it rains they drive him all the way home,” she said, standing in front of her house.

Local shopkeeper Marina Cáceres, the owner of the La Carapegueña 2 Supermarket, told IPS that “My sales have gone up, there’s more money in the city in the past couple of years; in this block alone there are three CAIASA employees.” The La Carapegueña 1 Supermarket, “which belongs to my father-in-law”, is at the entrance to the city, she said.

Villeta, 45 km from Asunción, is still mainly a rural municipality. Half of its estimated 40,000 inhabitants still live in the countryside, Mayor Teodosio Gómez told IPS.

But the arrival of dozens of industrial companies, which have invested a combined total of 800 million dollars here in the last five years, is changing the landscape and living standards in this municipality in Paraguay’s Central department.

Two truck drivers rest while waiting to unload their cargo in the Angostura Agroindustrial Complex (CAIASA) soy crushing plant in Paraguay. Some 2,000 trucks haul soybeans to the plant, which receives an average of 500 trucks a day during the peak harvest season, and where it takes less than a day to unload even during the busiest periods. Credit: Mario Osava/IPS

Two truck drivers rest while waiting to unload their cargo in the Angostura Agroindustrial Complex (CAIASA) soy crushing plant in Paraguay. Some 2,000 trucks haul soybeans to the plant, which receives an average of 500 trucks a day during the peak harvest season, and where it takes less than a day to unload even during the busiest periods. Credit: Mario Osava/IPS

Besides CAIASA, which is a joint venture between two global agribusiness giants, the U.S. Bunge and France’s Louis Dreyfus, another U.S.-based food corporation, ADM, has also set up an agroindustrial plant in the municipality, which is attractive because of its location where the Paraguay river narrows and deepens enough to handle large barges with a cargo capacity of over 2,000 tons.

The result is “low unemployment and violent crime levels,” said the mayor. Besides creating direct jobs, the industries have generated a market for different services and locally produced foods.

The town, founded in 1714 around a river port, where mainly oranges were shipped out, is now at the centre of a diversified economy which includes stockbreeders and small farmers, and is becoming “the industrial capital of Paraguay,” said Gómez.

A skilled local workforce is taking shape through training, of workers, technicians and managers, to prepare them to work in the new industrial plants.

Megumi Kosaka, a 28-year-old chemical engineer, has been in training for the past 15 months, learning to manage any sector of CAIASA, from the reception of soybeans, quality control, the furnace and water treatment to the production of soymeal, oil, and soybean husk pellets.

She is learning all of this “in theory and in practice,” sometimes filling in for the manager of a section for several days or weeks. “For me it’s great – I see all of the operations, I learn everything, I have the chance to work with a wide range of professionals,” she told IPS.

Her favourite area, however, is production. “The machines are like living things, which with small differences in what we do produce something different, in terms of the quality of the sub-product,” Kosaka said.

“If we dry them too much, the soybeans crack, they don’t produce as much oil as possible; you have to know the exact level of moisture…it’s interesting to see the changes, what works best,” she said.

Villeta Mayor Teodosio Gómez, seen here in his office, says his municipality will be the industrial capital of Paraguay, thanks to its location on the Paraguay river and its flourishing industrial park, just 45 km from Asunción. Credit: Mario Osava/IPS

Villeta Mayor Teodosio Gómez, seen here in his office, says his municipality will be the industrial capital of Paraguay, thanks to its location on the Paraguay river and its flourishing industrial park, just 45 km from Asunción. Credit: Mario Osava/IPS

The daughter of Japanese immigrants, Kosaka already worked in a small soy crushing plant. “In a big one like CAIASA they pay me a better salary to learn more; later I’ll pay them back for what I learned, with my work.”

Her long-term dream is to open a factory in Colonia Iguazú, where her parents and 200 other Japanese families live, in southeast Paraguay, near the border with Brazil. Like 90 percent of the country’s soy producers, farmers there grow soy but do not process it.

A crushing plant would generate skilled jobs and would make it possible for young people who study to stay in the area. Today, with no chance of finding a decent job, “they leave,” Kosaka said.

“The question of human resources is extremely important in Paraguay, and CAIASA made an intelligent decision to train local people, which is a slow process,” said Julio Fleck, head of production in CAIASA, who was in charge of selecting workers and technicians for training, to form a payroll of 200 people.

Workers from other fields, people from the world of business and trade, and some local mechanics and electricians were selected. “We sent them to Argentina for training,” said Fleck, who was involved in the construction of the complex since 2012.

“I come from a different school,” he told IPS, referring to his previous job in the Colonias Unidas Cooperative in southern Paraguay, which is dedicated to diversified agriculture and has a small factory that produces cooking oil from different raw materials.

In CAIASA, he said, he found the “focus” he was seeking, “the big industry where I can learn more in-depth know-how,” to reach maximum productivity. “The good thing in CAIASA is that it offers an opportunity for improvement in a modern, new industry with a high level of mechanisation. But it requires the setting of priorities among the many fronts that must be attended.”

A barge makes its way down the Paraguay river, one of South America’s most important rivers, past the town of Villeta, which has several public and private ports and an industrial park that has become the hub of agroindustry in Paraguay, focused on processing soy, of which this small country is one of the world’s leading exporters. Credit: Mario Osava/IPS

A barge makes its way down the Paraguay river, one of South America’s most important rivers, past the town of Villeta, which has several public and private ports and an industrial park that has become the hub of agroindustry in Paraguay, focused on processing soy, of which this small country is one of the world’s leading exporters. Credit: Mario Osava/IPS

One priority was the fuel to fire the furnace. The fact that there is little demand in Paraguay for soybean husk pellets, a sub-product of soy, and that they are not export quality, helped lead to their choice as a fuel, since the idea was to avoid the use of fossil fuels.

But the excess ashes generated by the burning of the pellets hurt the productivity of the furnace, driving up maintenance costs. For this reason, wood chips continued to be used as well, a sustainable option, since the companies that provide them are certified as deforestation-free.

The challenge is how to boost the productivity of the furnace with these two raw materials, said Fleck, a 44-year-old chemical engineer who described himself as obsessed with competitiveness. Logistics, for example, affects Paraguayan soy and its by-products in terms of competition with neighbouring Argentina, which is closer to the markets abroad.

As Paraguay is surrounded by two giant soybean producers, Argentina and Brazil, the expansion of CAIASA depends on what those competitors do, he said.

The truckers, who make up the biggest group of workers among those linked to CAIASA, say the company brought them better pay in the past, but that this has changed since global soy prices plunged.

“I used to earn between eight and nine million guaranis (between 1,400 and 1600 dollars) a month; now I’m earning just 3,500 (615 dollars),” complained Mario Ortellano in the CAIASA parking lot, while waiting to unload the soybeans in his truck.

But the alternative for this 41-year-old who has driven a truck for 13 years is to return to his hometown of Villa Rica, 160 km from Asunción, and to a job as a machine and forklift operator, earning just the minimum wage, 315 dollars a month.

Edited by Estrella Gutiérrez/Translated by Stephanie Wildes

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Soy Fuels Industrialisation in Paraguayhttp://www.ipsnews.net/2016/03/soy-fuels-industrialisation-in-paraguay/?utm_source=rss&utm_medium=rss&utm_campaign=soy-fuels-industrialisation-in-paraguay http://www.ipsnews.net/2016/03/soy-fuels-industrialisation-in-paraguay/#comments Wed, 23 Mar 2016 21:45:30 +0000 Mario Osava http://www.ipsnews.net/?p=144324 http://www.ipsnews.net/2016/03/soy-fuels-industrialisation-in-paraguay/feed/ 1 Argentina’s ‘Shale Capital’ Suffers from Slowdownhttp://www.ipsnews.net/2016/03/argentinas-shale-capital-suffers-from-slowdown/?utm_source=rss&utm_medium=rss&utm_campaign=argentinas-shale-capital-suffers-from-slowdown http://www.ipsnews.net/2016/03/argentinas-shale-capital-suffers-from-slowdown/#comments Sat, 19 Mar 2016 05:34:33 +0000 Fabiana Frayssinet http://www.ipsnews.net/?p=144242 Añelo, a Patagonian town in southwest Argentina that experienced explosive growth because it is next to the country’s biggest shale oil and gas field, is now starting to feel the impact on the development of these resources due to the plunge in international oil prices. Credit: Fabiana Frayssinet/IPS

Añelo, a Patagonian town in southwest Argentina that experienced explosive growth because it is next to the country’s biggest shale oil and gas field, is now starting to feel the impact on the development of these resources due to the plunge in international oil prices. Credit: Fabiana Frayssinet/IPS

By Fabiana Frayssinet
AÑELO, Argentina, Mar 19 2016 (IPS)

The dizzying growth of Añelo, a town in southwest Argentina, driven by the production of shale oil and gas in the Vaca Muerta geological reserve, has slowed down due to the plunge in global oil prices, which has put a curb on local development and is threatening investment and employment.

Vaca Muerta, a 30,000-sq-km geological reserve rich in unconventional fossil fuels in the province of Neuquén, began to be exploited in mid-2013 by the state-run oil company Yacimientos Petroliferos Fiscales (YPF) in a joint venture with U.S. oil giant Chevron.

“We had an interesting growth boom thanks to the strategic development plan that we were promoting, to get all of the oil services companies to set up shop in Añelo. That really boosted our growth, and helped our town to develop,” Añelo Mayor Darío Díaz told IPS.

The population of this town located 100 km from the provincial capital, Neuquén, in Argentina’s southern Patagonian region, rose twofold from 3,000 to 6,000.

And that is not counting the large number of machinists, technicians, engineers and executives of the oil companies who rotate in and out of the area, along with the truckers who haul supplies to the Loma Campana oilfield eight km from Añelo.

“There were around 10 services companies operating in Añelo; now we have about 50, and some 160 agreements signed for other companies to come here,” the mayor said.

The shale gas and oil in Vaca Muerta has made this country the second in the world after the United States in production of unconventional fossil fuels.

Loma Campana, where there are 300 active wells producing unconventional gas and oil after a total investment of three billion dollars, currently produces 50 billion barrels per day of oil, according to YPF figures.

The shale oil and gas industry has fuelled heavy public investment in Añelo and nearby towns. The population of this town is expected to reach 25,000 in the next 15 years.

“We’re building two schools and a hospital,” Díaz told IPS. “The primary and secondary schools have been expanded. We are making town squares and a new energy substation. We built a water treatment plant and have improved the sewage service. In terms of public works we have really done a great deal, keeping our eyes on our goal: growth.”

But the expansion of the town has also brought problems.

The mayor pointed out, for example, that rent for a two-bedroom housing unit has climbed from 33 dollars to 100 dollars a month, and that a plot of land that previously was worth 1,700 dollars cannot be purchased now for less than 130,000 dollars.

“Those are abrupt changes brought by the oil industry,” Díaz said. “What us old-time residents of Añelo have suffered the most is the social impact of all of this movement, of so much vehicle traffic, so many people, which brings insecurity and other things that are typical of development in general.”

New complications

People in Añelo are now worried that despite the costs they are paying for the development boom, the promised progress will not arrive.

On Mar. 4, the outgoing president of YPF, Miguel Galuccio, announced in a conference with international investors that the cutbacks in the industry in 2016 would be reflected in slower progress in Vaca Muerta.

Workers in Loma Campana, a field with 300 shale oil wells in Vaca Muerta. The decision to slow down the development of unconventional fossil fuels in Argentina has led to lay-offs in the area. Credit: Fabiana Frayssinet/IPS

Workers in Loma Campana, a field with 300 shale oil wells in Vaca Muerta. The decision to slow down the development of unconventional fossil fuels in Argentina has led to lay-offs in the area. Credit: Fabiana Frayssinet/IPS

In 2015, the company’s revenues shrank 49 percent, while investment grew less than four percent, below previous levels.

The costs of producing shale gas and oil, which requires an expensive technique known as hydraulic fracturing or “fracking”, are not competitive in a context where international oil prices are hovering between 30 and 40 dollars a barrel.

In Argentina, the cost of extraction in conventional wells stands at 25 to 30 dollars a barrel, and in unconventional wells at around 70 dollars a barrel, oil industry experts report.

But the internal price of a barrel in Vaca Muerta is regulated at 67.5 dollars and in the rest of the country’s oilfields at 54.9 percent – an artificial price established to shore up the oil industry’s expansion plans, especially in this part of the country, although at a slower pace now.

YPF announced that in Vaca Muerta, it would cut oil production costs by 15 percent, which has led to lay-offs.

“The situation is very complicated,” said Díaz, who estimated that there will be 1,000 more unemployed people in the province, added to those who have already lost their jobs. “A reduction in activity,” has already been seen, he said, and “people are working fewer hours” and wages have fallen, which has a social impact, he added.

Oil worker unions in Vaca Muerta say 1,000 people have been laid off so far in the industry, as well as 1,000 in other areas.

Eduardo Toledo, an agricultural technician who decided to move from Buenos Aires to Añelo and invest his savings in a restaurant, is worried about the slowdown in oil industry activity in Vaca Muerta.

“When we started, we had just one stove with three burners and an oven,” said Toledo, whose customers are truck drivers, factory workers and other oil industry employees who have been drawn to this area by the relatively high wages paid by the industry.

Like Toledo, many people invested in hotels, rental housing, shops and small-scale service businesses. “Everyone wanted to come to what was going to be the shale gas and oil capital,” he said.

But now his restaurant is working at a “mid to low level of activity.”

“If people know they’re going to lose their jobs, they don’t want to spend money,” he said.

Toledo is still confident that interest in shale gas and oil will keep things moving, despite the plummeting prices.

In Vaca Muerta, 77 percent of the proven shale reserves are gas.

Besides, “there are major gas resources that have not yet become reserves,” Ignacio Sabbatella, who holds a PhD in social sciences from the University of Buenos Aires and is the co-author of the book “History of a privatization; How and why the YPF was lost”, told IPS. (YPF was renationalised in 2012.)

But experts and local residents are taking a long-term view.

Sabbatella stressed that it is important to keep in mind that beyond the current international oil price swings, the investments in Vaca Muerta “will yield fruit in the long term” – in five to 10 years.

He pointed out that shale oil and gas production only got underway in the area in 2011, “and especially after the recovery of state control of YPF, in a joint venture with transnational corporations like Chevron.”

YPF, Argentina’s biggest company, was in private hands from 1992 to 2012, when the government of Cristina Fernández (2007-2015) decided to renationalise it.

Sabbatella said the announced cutbacks in YPF have coincided with an overall “shift in policy” since the arrival to the presidency on Dec. 10 of the centre-right Mauricio Macri, who ended a period of centre-left governments under Néstor Kirchner (2003-2007) and later his wife and successor, Fernández.

“The previous government did everything possible to sustain the levels of investment, exploration and production, even in an unfavourable international context, and what we are seeing is that this government is only halfway maintaining that policy and is even pushing YPF to cut its investments,” said Sabbatella.

“The current administration believes that the best thing is to adjust domestic oil industry policy to external conditions. In a context of low prices, they believe the best idea is to not sustain domestic investment, and they have even shown some illustrations of this, by importing cheaper crude and fuel from abroad, for example,” he said.

But Toledo prefers to be optimistic, because otherwise, he said, “I have to close my restaurant.”

“I can’t afford to go somewhere else and I’m not interested anyway because it’s hard to set down roots again in a place like this.”

Edited by Estrella Gutiérrez/Translated by Stephanie Wildes

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Rural Community Fights a Second Dam and a New Expropriation of Landhttp://www.ipsnews.net/2016/03/rural-community-fights-a-second-dam-and-a-new-expropriation-of-land/?utm_source=rss&utm_medium=rss&utm_campaign=rural-community-fights-a-second-dam-and-a-new-expropriation-of-land http://www.ipsnews.net/2016/03/rural-community-fights-a-second-dam-and-a-new-expropriation-of-land/#comments Tue, 08 Mar 2016 18:01:42 +0000 Emilio Godoy http://www.ipsnews.net/?p=144124 Part of the rural municipality of Chicoasén to be flooded by the second dam built in that area, in the southern Mexican state of Chiapas. A large part of the local peasant farmers are fighting the new hydropower plant, pointing to the damages they say were caused by the Chicoasén 1 dam, built 40 years ago. Credit: Emilio Godoy/IPS

Part of the rural municipality of Chicoasén to be flooded by the second dam built in that area, in the southern Mexican state of Chiapas. A large part of the local peasant farmers are fighting the new hydropower plant, pointing to the damages they say were caused by the Chicoasén 1 dam, built 40 years ago. Credit: Emilio Godoy/IPS

By Emilio Godoy
CHICOASÉN, Mexico , Mar 8 2016 (IPS)

In 1976, the construction of a hydroelectric dam destroyed farmland in the rural municipality of Chicoasén in southern Mexico. Forty years later, part of the local population is fighting a second dam, which would deprive them of more land.

“They destroyed everything,” Antonio Herrera, one local resident of this municipality in the state of Chiapas, told IPS. “The land is useless now, it’s impossible to farm it. The dam has affected our lives a great deal.”

Herrera complained that local peasant farmers have been unable to reach their land since Mexico’s state-owned power utility Comisión Federal de Electricidad (CFE) granted a contract in January 2015 for the construction of the Chicoasén 2 dam on the Grijalva River. The project includes a plan to expropriate part of the ejido – formerly public land held in common by the inhabitants of a village and farmed cooperatively or individually.“We don’t have any information about the hydropower dam. We don’t know what will happen to the people who live along the riverbanks. The CFE says it has permission from the ejidatarios, but we haven’t given them permission. They are basing their arguments on a false (community) assembly, which has signatures from owners who are already dead.” -- Claudia Solís

A huge mechanical shovel digs up sand and gravel while Herrera, a member of the Chicoasén ejido committee, points to the work site in the distance, where the formerly green land is coated by brown.

The 240-MW dam, to be built at a cost of 300 million dollars, is scheduled to come onstream in July 2018.

IPS saw the environmental impact study that the CFE presented to the environment ministry. It states that the total surface area amounts to 234 hectares, 188 of which will be covered by the reservoir, located some 850 km south of Mexico City in this municipality of 5,159 people, the traditional territory of the Nahoa and Zoque indigenous peoples.

The CFE awarded the contract for the construction of the dam to a consortium of three Mexican companies and the Costa Rica-based subsidiary of the Chinese firm Sinohydro. The utility has already expropriated 69 hectares of land for the new dam. The owners of the land were paid 2,300 dollars per hectare.

In 1951, the government granted the local residents 3,400 hectares to create the ejido, which doubled in size in 1986 when they were given another 3,461 hectares. The land is owned by 460 ‘ejidatarios’ or members of the ejido, around 50 of whom have since died and passed on their land to their wives or children.

The first Chicoasén dam, 100 km from the second, expropriated land from the original ejido grant, and the second will take part of the land awarded in 1986.

When the CFE built the 2,400-MW Manuel Moreno Torres dam, better known as Chicoasén 1, in 1976, the company promised to pay for the land and provide piped water, a school and a health clinic.

But these promises were not fulfilled, the ejidatarios complain.

And now they are afraid history will repeat itself.

“We don’t have information about the hydropower dam,” Claudia Solís, the daughter of one of the ejidatarios, told IPS. “We don’t know what will happen to the people who live along the riverbanks. The CFE says it has permission from the ejidatarios, but we haven’t given them permission. They are basing their arguments on a false (community) assembly, which has signatures from owners who are already dead.”

Mainly elderly peasant farmers in Chicoasén, in the southern Mexican state of Chiapas, who have land in an “ejido” – formerly public land that was granted to communities to farm individually or cooperatively – take part in a protest against the installation of a second hydroelectric dam in the area, which will affect their farms and their way of life. Credit: Emilio Godoy/IPS

Mainly elderly peasant farmers in Chicoasén, in the southern Mexican state of Chiapas, who have land in an “ejido” – formerly public land that was granted to communities to farm individually or cooperatively – take part in a protest against the installation of a second hydroelectric dam in the area, which will affect their farms and their way of life. Credit: Emilio Godoy/IPS

To block construction of the new dam, local residents have held demonstrations, community elders have gone on hunger strike, and legal action has been taken.

But the ejidatarios are divided, because one group supports the new dam.

The opponents are a majority in the community and are led by a group of elders who are dedicating their last remaining energy to defending their land and their way of life, taking to the streets with their canes, their straw ‘sombreros’ and their families.

In December 2014, 62 ejidatarios brought individual lawsuits, which were admitted by a federal judge in October 2015. And in March 2015 they filed a collective lawsuit, which was accepted by another federal judge in May 2015.

But work on the dam has not been brought to a halt.

The local population grows crops like maize, pumpkin, beans, watermelon and melon, fishes in the water of the reservoir and caters to tourists who visit the area.

Chiapas, a supplier of energy

Several large-scale energy projects have been built or are planned by the government or companies in the impoverished state of Chiapas.

Four dams already operating in the state represent 45 percent of the country’s hydroelectricity. Three others also produce energy in what is Mexico’s main river basin.

Construction of the dams has left its mark on local communities and has modified the natural water regimes, led to the loss of vegetation, displaced wildlife and destroyed their habitats, environmentalists and ejidatarios told IPS during the last protest held against the dam and a visit to the affected area.

In Mexico, 13 large hydroelectric dams generate more than 10,000 MW a year, of the total 65,000 MW produced in the country. There is only one new hydropower project in the 2015-2029 National Electric System Development Programme (PRODESEN), launched in July 2015: Chicoasén 2.

The Chicoasén 2 environmental impact study says the dam will directly affect five communities in the municipality and will indirectly affect another 10. It also acknowledges that the dam, the reservoir and the hypdropower plant will hurt the landscape, wildlife and surface drainage.

“We don’t want the dam,” said Herrera, whose family includes four other ejidatarios. “The CFE doesn’t listen to us, it doesn’t take us into account.”

In 2013, the Clean Development Mechanism of the United Nations Framework Convention on Climate Change rejected the inclusion of Chicoasén 2 as a carbon offsetting project, under the argument that there was no clear demonstration of the emissions reduction, which the government estimated at 300,000 tons of carbon dioxide.

Besides the key role it plays in the generation of hydropower, since the 1970s Chiapas has become increasingly important in terms of oil production, and both the state-owned oil giant Pemex and the energy ministry included new fields in the state to be explored or put to tender, in their plans in 2015.

Twenty oilfields are operating in Chiapas, with a total of 278 million barrels of oil in reserves, and an impact on 38 Zoque communities in six municipalities.

And the 2015-2019 Five-Year Plan for the Expansion of the System for the Transportation and Storage of Natural Gas includes the projected 440-km Salina Cruz-Tapachula gas pipeline between the states of Chiapas and Oaxaca, to be completed in 2018, but not yet put out to tender.

A survey carried out in the state by the energy ministry on the impact of oil industry operations on other economic activities found that it hurt agriculture, tourism and archaeological sites, as well as nine large environmental areas.

“Exploration for oil has an impact on forests, water resources, and indigenous communities,” Fabio Barbosa, a professor in the economy department of the Autonomous National University of Mexico, told IPS. “The conflicts that already exist will be aggravated, but oil companies aren’t stopped by social conflicts.”

Barbosa said oil industry plans are unsustainable. “If an important well is developed, environmental disasters created in other states can be repeated,” he warned.

Mexico’s law on fossil fuels, in effect since August 2014 as part of the reform that opened up the oil and power industries to private capital, stipulates that the energy ministry must hold non-coercive negotiations to obtain free, prior and informed consent from indigenous communities when energy projects are to be carried out in their territories.

In addition, companies must present a social impact assessment in order to obtain a permit for their projects.

But these requisites have not been enforced in Chiapas, according to local residents and social and environmental activists.

Edited by Estrella Gutiérrez/Translated by Stephanie Wildes

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Panama’s Expanded Canal Faces a Challenging Scenariohttp://www.ipsnews.net/2016/03/panamas-expanded-canal-faces-a-challenging-scenario/?utm_source=rss&utm_medium=rss&utm_campaign=panamas-expanded-canal-faces-a-challenging-scenario http://www.ipsnews.net/2016/03/panamas-expanded-canal-faces-a-challenging-scenario/#comments Fri, 04 Mar 2016 16:44:21 +0000 Iralis Fragiel http://www.ipsnews.net/?p=144076 Two ships go through the Miraflores locks on the Pacific side of the Panama Canal, which raise or lower vessels 16.5 metres and take 40 minutes to pass through. Credit: Iralís Fragiel/IPS

Two ships go through the Miraflores locks on the Pacific side of the Panama Canal, which raise or lower vessels 16.5 metres and take 40 minutes to pass through. Credit: Iralís Fragiel/IPS

By Iralís Fragiel
PANAMA CITY, Mar 4 2016 (IPS)

When the new locks of the expanded Panama Canal begin operations, they will do so amidst numerous challenges, because of the storm clouds hanging over the global economy, especially China. But local authorities and experts are not worried about the possible impact on the expanded canal.

The slowdown in the Chinese economy, the second largest client of the Panama Canal, transporting 48.42 million tons in 2015, is one of the factors causing concern regarding this motor of the Panamanian economy, which last grew six percent, the highest rate in Latin America.

But the start of operations of the expanded canal, due in May or June, does not worry Luis Ferreira, spokesman for the Panama Canal Authority (ACP), an autonomous government agency.“When there were economic problems in the past, we would lose basically two to three percent of the cargo; the same thing might happen this time, but we don’t expect a substantial decrease, unless there is an all-out recession in China.” – Luis Ferreira

“When there were economic problems in the past, we would lose basically two to three percent of the cargo; the same thing might happen this time, but we don’t expect a substantial decrease, unless there is an all-out recession in China,” he said in an interview with IPS.

In 2015, China’s GDP grew 6.9 percent, compared to 7.3 percent in 2014, confirming the slowdown after years of double-digit growth.

The expansion of the 80-km canal, which turned 100 years old in 2014 and which handles approximately five percent of global trade, involved an investment of 5.25 billion dollars. Work began on Sep. 3, 2007.

With this megaproject, carried out by Grupo Unidos por el Canal (GUPC), the consortium led by Spanish construction firm Sacyr, Panama hopes to increase daily ship traffic from 35- 40 to 48-51.

The canal will also be able to accommodate larger vessels. Currently, it can only handle ships with a cargo capacity of up to 5,000 tons, but once the expansion is complete New Panamax vessels with a capacity of up to 13,000 tons will be able to go through the canal.

For Panama’s productive sectors, the expansion of the canal holds out the promise of economic growth.

The ACP’s team of experts in foreign trade told IPS that the weakening of the global economy in 2015 did not affect the canal, and that no impact is expected this year either.

“The volumes of raw materials heading for China for industrial use, such as coal and iron ore, are not significant (for the canal), since there are closer sources in Australia and Brazil, which do not use the waterway,” the ACP experts stated in their collective response to IPS.

Meanwhile, the volumes of grains, especially soy, grew at a strong pace in the last few years, due to the rising demand for food in China.

The experts also said the expansion “will open up new opportunities for trade flows of non-traditional products, such as liquefied natural gas, and will offer economies of scale that will make the Panama Canal route more attractive for segments such as container vessels and dry bulk cargo ships.”

The new locks in Cocolí, on the Pacific Ocean, have 16 rolling gates. Each chamber is 427 metres long by 55 metres wide and 18.3 metres deep. The expanded Panama Canal will be able to handle New Panamax vessels with a capacity of up to 13,000 tons, up from the current 5,000 ton limit. Credit: Iralís Fragiel/IPS

The new locks in Cocolí, on the Pacific Ocean, have 16 rolling gates. Each chamber is 427 metres long by 55 metres wide and 18.3 metres deep. The expanded Panama Canal will be able to handle New Panamax vessels with a capacity of up to 13,000 tons, up from the current 5,000 ton limit. Credit: Iralís Fragiel/IPS

Cargo tonnage by origin and destination has remained steady over the last three years, according to the ACP. The United States remains the largest client of the canal, with a total cargo of 160.78 million tons in 2015.

The cargo traded between the two leading clients reflects this stability. From China to the United States, 10.37 million tons were shipped through the canal in 2013, 10.96 million in 2014 and 10.91 million in 2015. And from the United States to China, 24.95 million tons were shipped in 2013, 30.77 million in 2014 and 30.20 million in 2015.

Given the economic outlook in China and changes in the energy sources used, the ACP is also getting ready for traffic of liquefied natural gas carriers.

“An incursion into new areas of business that reinforce the transportation and logistics industries is being evaluated, such as the case of the Corozal port and the creation of a logistics park that would complement the operations of the expanded canal,” the ACP experts said.

Canal revenue totaled 2.6 billion dollars in 2015, up from 2.5 billion in 2014, and equivalent to 5.61 percent of the country’s GDP.

Jordi Prat at the Interamerican Development Bank (IDB) told IPS that Panama has “a positive economic outlook but not without risks.” And in the case of the canal, the United States, which it depends on most, “is growing at a relatively strong pace,” although the vulnerability could increase if the situation in China continues to go downhill.

Prat, the IDB’s principal regional economist for Central America, said the challenge faced by this country is keeping the growth rate between six and eight percent a year, and preventing a decline in maritime trade flows, fuelled by other sources of growth.

Prat pointed out that between 2000 and 2014, the sectors that grew the most in Panama were construction (37 percent), transportation and logistics (22 percent), finance (15 percent) and public services (12 percent).

Besides the economic variables, inclusion is key to development in this Central American nation of four million people, he said.

Panama managed to reduce the poverty level from 38.3 to 25.8 percent, between 2006 and 2014, said Prat. However, inequality is reflected by the fact that 86.9 percent of the population in autonomously governed indigenous “comarcas” or counties is poor.

The IDB economist said Panama should move towards “inclusive growth, by fomenting human capital, education, and access to health and basic services, in order to boost productivity, which has not increased significantly in recent times.”

Analyst Rodrigo Noriega concurs with Prat that Panama has to seriously focus on education, training and scientific research, to bolster development.

“That is where we are limping, in education, and in corruption – these are issues that in the long term definitely hurt the Panamanian economy,” said Noriega.

He said the economy may see growth slow down in 2016 and 2017, due to external factors and the impact of the drought caused by the El El Niño-Southern Oscillation (ENSO), a cyclical climate phenomenon that affects weather patterns around the world.

“These external factors could be reducing Panama’s GDP by 2.0 to 2.5 percent a year. What I’m saying is GDP could be growing between 7.5 and 8.0 percent, instead of the current 5.0 to 5.5 percent,” he said.

But he stressed that a project such as the expansion of the canal is not something that is undertaken with a short-term view, but to address the needs of the country over the next 30 to 50 years.

“There will be two slow years, but that is actually a good thing for us because right now we have a water shortage problem. It’s best if the ship traffic isn’t so heavy, because we need to recover in terms of water supply and take baby steps to learn to handle the larger vessels,” said Noriega.

Edited by Estrella Gutiérrez/Translated by Stephanie Wildes

 

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Central America Makes Uneven Progress in Clean Energyhttp://www.ipsnews.net/2016/03/central-america-makes-uneven-progress-in-clean-energy/?utm_source=rss&utm_medium=rss&utm_campaign=central-america-makes-uneven-progress-in-clean-energy http://www.ipsnews.net/2016/03/central-america-makes-uneven-progress-in-clean-energy/#comments Tue, 01 Mar 2016 20:54:51 +0000 Diego Arguedas Ortiz http://www.ipsnews.net/?p=144050 The Reventazón Hydroelectric Project, Costa Rica’s fifth hydropower dam, will begin to operate in the first half of this year. Credit: Instituto Costarricense de Electricidad

The Reventazón Hydroelectric Project, Costa Rica’s fifth hydropower dam, will begin to operate in the first half of this year. Credit: Instituto Costarricense de Electricidad

By Diego Arguedas Ortiz
SAN JOSE, Mar 1 2016 (IPS)

Over the last decade, Central America has managed to reduce its dependence on fossil fuels for the production of electric power, while expanding coverage. But the progress made by each country varies widely.

“The question is not whether or not demand is met, but which sources we are using to generate electricity,” Diego Fernández, one of the researchers with the State of the Region Programme (PER) of the Consejo Nacional de Rectores (CONARE), which groups Costa Rica’s four public universities, told IPS.

Fernández pointed out that more and more Central Americans are connected to their national power grids. The electrification rate climbed from an average of 69 percent in 2000 to 90 percent in 2013, according to a joint study by PER and the Economic Commission for Latin America and the Caribbean (ECLAC).

“The biggest advances in the region (in terms of energy) have been seen in the electricity sector,” says the October 2015 report.

However, the growth has not been uniform. In electrification, Nicaragua has only 75 percent coverage, much lower than the regional average, while coverage in Costa Rica has reached 99 percent.

The sources chosen to generate electricity are the clearest demonstration of the priorities in each country’s energy strategy.

Costa Rica is the leader in clean energy sources, which now account for 95 percent of the country’s electricity.

Meanwhile, Honduras and Nicaragua have the dirtiest power grids, with nearly half of their electricity coming from plants that run mainly on low-cost bunker fuel, which is the heavy, residual oil that is left over after gasoline, diesel and other light hydrocarbons are extracted from crude oil during the refining process. This low-quality fossil fuel has an impact on the health of local inhabitants.

The clearest evidence that decisions about electric power have a direct impact on local economies is what countries spend on oil – nations that use fossil fuels to generate electricity spend twice as much as those that rely more heavily on renewable sources.

“In countries that produce more electric power from renewable sources, like Costa Rica, the oil bill is less than five percent of GDP; in Honduras and Nicaragua, the oil bill is 12 percent,” the researcher said.

Central America, with a total population of 48 million, is a net importer of fossil fuels, which are used mainly for transportation, and to a lesser extent in power generation.

As a result, Central America’s oil bill climbed from 3.5 percent of GDP in 2000 to 8.5 percent in 2014, according to statistics provided by PER and ECLAC.

But overall, expansion in electricity generation in the region between 2003 and 2014 largely involved renewables.

There are major disparities in Central America, where Costa Rica’s electricity, for example, comes almost entirely from renewable sources, while half of Nicaragua’s power comes from fossil fuels. And coal has been making a comeback. Credit: State of the Region

There are major disparities in Central America, where Costa Rica’s electricity, for example, comes almost entirely from renewable sources, while half of Nicaragua’s power comes from fossil fuels. And coal has been making a comeback. Credit: State of the Region

“Thanks to regional accords and national policies, the share of renewable energies increased….from 57 to 64 percent,” Víctor Hugo Ventura, the head of ECLAC’s Energy and Natural Resources Unit, told IPS.

The Guatemalan expert said the region still puts a priority on hydroelectricity, but medium and large-scale projects are blocked and delayed by opposition from social and environmental activists.

However, it is difficult to generalise about the region in terms of electricity production, because of the differences between the countries.

Guatemala, for example, increased the share of renewable energy from 50.7 to 56.1 percent of its energy mix between 2009 and 2014, according to ECLAC, but it continues to invest in coal-fired power stations, the most highly polluting form of energy.

A coal plant belonging to Jaguar Energy Guatemala, a subsidiary of the U.S.-based Ashmore Energy International, began to operate in Guatemala in 2014. Built at an estimated cost of 750 million dollars, it has an installed capacity of 300 MW, and is now the country’s biggest power plant.

However, Ventura said the plant does not necessarily mean the country intends to increase its dependence on coal. He argued that it was the result of a misguided decision taken when the price of oil skyrocketed in 2007. “Problems with the generators forced it to stop operating, and it is currently not producing electricity. Sometimes what’s cheap turns out to be expensive,” he said.

The ECLAC expert predicted a rise in consumption of natural gas, another fossil fuel, over the next decade in Central America.

But for years, this region, made up of Belize, Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua and Panama, has been urged to reduce its dependence on fossil fuels to generate electricity.

Overall, the region has responded, although it has not stopped installing power stations that run on coal and bunker fuel, drawing criticism in reports by international bodies.

“The outlook has been very positive for wind power, whose capacity has grown by a factor of nearly 10 so far this millennium,” states the joint PER/ECLAC report.

Three countries have large wind power farms: Costa Rica, Honduras and Nicaragua.

In Nicaragua, wind energy represented 14.8 percent of the country’s energy production in 2013.

These unconventional sources also make it possible to bring electricity to isolated rural areas, where community organisation plays a major role.

“We can mention several cases of solar panel projects, where the installation and maintenance has been put in the hands of local women sent for training to India,” said Ventura from the subregional ECLAC office in Mexico.

He said the countries of Central America must take climate change and the need to cut greenhouse gas emissions into account in their long-term plans.

“Climate change represents major challenges for the region, where the effects and impacts of this phenomenon also have to be taken into consideration in terms of renewable resources and capacity to generate less polluting forms of energy,” Alejandra Sobenes, a lawyer who is an expert on sustainability, told IPS.

Sobenes, a former Guatemalan deputy minister of natural resources, said her country has recognised the need to take measures to prevent electricity shortages after 2026.

“But the commitment to reduce our emissions by at least 11.2 percent, or 22.6 percent in a more ambitious scenario, must be kept in mind, and the use of coal should be reconsidered,” she said from the Guatemalan capital.

Another problem is the variability of the most accessible clean energy sources: wind and the sun.

“In the case of solar and wind energy, the insertion of renewable sources in the region’s energy mix has been facilitated a great deal, but with one problem: these sources are variable,” Javier Orozco, director of electrical planning in the Costa Rican power utility, Instituto Costarricense de Electricidad, told IPS.

Each country gets around this variability as best it can. One strategy is to turn to geothermal energy, which is abundant and relatively untapped in the region. Another alternative is to build enormous reservoirs to release water when sun or wind are in short supply. And then there is the option of burning fossil fuels.

“In Costa Rica we use the most adequate technological solution: hydropower dams. We store up energy, or water, and release it as needed,” said Orozco.

Edited by Estrella Gutiérrez/Translated by Stephanie Wildes

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Argentina’s Ties with China: Pragmatism over Politicshttp://www.ipsnews.net/2016/02/argentinas-ties-with-china-pragmatism-over-politics/?utm_source=rss&utm_medium=rss&utm_campaign=argentinas-ties-with-china-pragmatism-over-politics http://www.ipsnews.net/2016/02/argentinas-ties-with-china-pragmatism-over-politics/#comments Mon, 22 Feb 2016 21:53:35 +0000 Fabiana Frayssinet http://www.ipsnews.net/?p=143951 An inter-urban railway car in Buenos Aires on a line that connects the Retiro neighbourhood with Tigre, in the north of Greater Buenos Aires. These Chinese-made cars are part of trade and investment accords reached by the two countries in the railway industry. Credit: Fabiana Frayssinet/IPS

Model of one of the two dams under construction to harness the Santa Cruz river in the southern Argentine province of that name. The project is to cost five billion dollars, and 85 percent will be financed by China. It was granted to a consortium of Argentine and Chinese companies. Credit: Represas Patagonia

By Fabiana Frayssinet
BUENOS AIRES, Feb 22 2016 (IPS)

Argentina’s new government is reviewing several major projects to be carried out jointly with China. But aside from a few changes in priorities, the administration is not expected to put the brakes on an alliance that Beijing classifies as strategic.

One of the campaign pledges of the conservative Mauricio Macri, who was sworn in as president on Dec. 10, was to revise or cancel agreements with China that he considered “lacking in transparency” or “secret”.

His centre-left predecessor, Cristina Fernández (2007-2015), signed a set of laws in March 2015 that gave rise to a framework agreement with China on economic cooperation and investment, strengthening relations between the two countries.

In his campaign, Macri and his associates lashed out harshly at the agreements with China. But after the excitement of the elections was over, the new government changed its tune.

“We can’t deny China’s weight in the world. It is not in Argentina’s interest to break with China,” said the new foreign minister, Susana Malcorra, describing their ties as part of “a balanced relationship with the world.”

In December, in fact, Macri used a currency swap deal (the exchange of principal and interest in one currency for the same in another) in effect with China since 2014, in the first measure he took to shore up Argentina’s foreign reserves.

And as his ambassador to Beijing he chose Diego Guelar, a diplomat who is considered one of the promoters of the alliance between China and Argentina.

“International pacts must be respected…Some believe that if we fail to honour our agreements with China, it will be well looked upon, quote unquote, by the United States and Europe,” Guelar said in an interview with the newspaper Perfil.

“But it’s quite the opposite: he who fails to honour some, does the same with others; that is, a reliable Argentina, which lives up to its international commitments and is loyal to its foreign partners, is a key factor in the credibility that we have to develop to the utmost,” he stressed.

China’s ambassador in Buenos Aires, Yang Wanming, pointed out that his country is the third-largest investor in Argentina, and that in the last five years, investments and merger and acquisition operations in Argentina have totaled 8.3 billion dollars.

Allowing these projects to go ahead “will set a good example for substantial China-Argentina cooperation in the future,” he said.

Apparently, pragmatism appears to have once more taken precedence over political rhetoric.

An inter-urban railway car in Buenos Aires on a line that connects the Retiro neighbourhood with Tigre, in the north of Greater Buenos Aires. These Chinese-made cars are part of trade and investment accords reached by the two countries in the railway industry. Credit: Fabiana Frayssinet/IPS

An inter-urban railway car in Buenos Aires on a line that connects the Retiro neighbourhood with Tigre, in the north of Greater Buenos Aires. These Chinese-made cars are part of trade and investment accords reached by the two countries in the railway industry. Credit: Fabiana Frayssinet/IPS

“Relations with China largely explain the years of economic growth after the 2001 crisis. Chinese investment in Latin America has grown significantly since around 2009,” Argentine academic Gonzalo Paz told IPS.

“The announcement that the accords would be reviewed was both a consequence of the election campaign and of the need for a thorough study of all of the issues in the relationship, and in particular of the megaprojects that were agreed in the final stage of the previous government,” he said.

Paz, an expert in relations between East Asia and Latin America at Georgetown University in Washington, D.C., believes Macri will try to expand ties with long-time partners like Italy and France, and get relations with the United States back on track.

“But a top global power like China must continue to be a key partner of Argentina,” he added.

In an interview with the Argentine-Chinese cultural magazine Dang Dai, Guelar announced that, in any case, he would review things that “were done badly or carelessly.”

“I believe the criticism of those projects will lead to changes, but not to a break in relations with China,” the director of Dang Dai, Néstor Restivo, co-author of the book “Everything you need to know about China” published by the Paidós publishing house, told IPS.

“In the future it will be essential to see what new areas of cooperation open up or what projects are developed. In other words it would be a serious mistake to only focus on the management of the projects that emerged in the previous stage, and to not have a proactive policy,” said Paz.

One of the most emblematic projects to be reviewed is the construction of the Néstor Kirchner-Jorge Cepernic Hydroelectric Complex in the province of Santa Cruz in Argentina’s southern Patagonia region, for a total investment of five billion dollars, 85 percent of which is to be financed by China.

In 2013, the contract for the project was granted to the Patagonia Dams consortium headed by the Argentine companies Hidrocuyo and Electroingeniería and the Chinese firm Gezhboua Group.

The complex, which includes the construction of two dams on the Santa Cruz river, will generate 1,740 MW of electricity, which is to cover eight percent of demand in this energy-strapped country once it has been completed in 2020.

Another megaproject, agreed in November, involves the construction of two nuclear plants – the fourth and fifth in the country – with a total investment of some 15 billion dollars. More than half of the parts in the plants are to be produced domestically, and 85 percent of the financing will come from China.

The agreement includes technology transfer from China and the joint exploration of third country markets.

“I don’t think there will be any backtracking in relations with China,” and the same is true with the hydropower plant, which has already begun to be built and whose contract was assigned in an international tender, Restivo said.

“It’s the biggest construction project that China is currently involved in outside of China…if the new government believes some irregularity was committed, it will continue forward on another track, but it is virtually impossible to think of stopping the project,” he said.

With respect to the nuclear plants, Restivo thinks there may be changes, based on the new government’s strategic energy plan.

“But letters of intent have been signed, and it wouldn’t look good to backpedal in relations with China, although everything is negotiable,” said the economist.

“The Chinese would protest if they were left out of what has already been signed, but they are flexible or pragmatic enough to see how to eventually compensate for a lost business deal,” he said.

The project whose future Restivo has the greatest doubts about is the one signed in August 2015 by the two governments for the upgrade of the freight rail network that links 17 of Argentina’s 23 provinces and belongs to the public railroad company Belgrano Cargas y Logística.

The agreement involves a first tranche of financing from China of 2.4 billion dollars, and a second of 2.47 billion, and foresees the transport of Argentine and Brazil agricultural products to Chilean ports on the Pacific ocean.

One of the casualties of the new government’s wave of dismissals of public employees was the payroll of the company Fabricaciones Militares, which had been commissioned to build some 1,000 rail cars, with more than 80 percent nationally-made parts – a key component in the reconstruction of the local railway industry.

“It’s quite possible that now we won’t be able to count any more on the part that interests me the most – for agreements with China to industrialise Argentina and not only serve Chinese interests,” Restivo said.

Above and beyond these uncertainties, ambassador Yang Wanming hopes for more: “To promote a higher level in the strategic integral alliance” between Beijing and Buenos Aires.

Edited by Estrella Gutiérrez/Translated by Stephanie Wildes

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Energy from All Sources, a Game of Chance in Brazilhttp://www.ipsnews.net/2016/01/energy-from-all-sources-a-game-of-chance-in-brazil/?utm_source=rss&utm_medium=rss&utm_campaign=energy-from-all-sources-a-game-of-chance-in-brazil http://www.ipsnews.net/2016/01/energy-from-all-sources-a-game-of-chance-in-brazil/#comments Thu, 28 Jan 2016 00:33:40 +0000 Mario Osava http://www.ipsnews.net/?p=143718 An industrial sugar and ethanol plant in Sertãozinho, in the southern Brazilian state of São Paulo. The sugar cane industry in Brazil has shrunk under the government of Dilma Rousseff, due to the gasoline subsidy, which dealt a blow to its competitor, ethanol. Credit: Mario Osava/IPS

An industrial sugar and ethanol plant in Sertãozinho, in the southern Brazilian state of São Paulo. The sugar cane industry in Brazil has shrunk under the government of Dilma Rousseff, due to the gasoline subsidy, which dealt a blow to its competitor, ethanol. Credit: Mario Osava/IPS

By Mario Osava
RIO DE JANEIRO, Jan 28 2016 (IPS)

Brazil, which boasts that it has one of the cleanest energy mixes in the world, is now plagued by corruption, poor market conditions, and bad decisions – a near fatal combination.

Brazil’s energy mix is made up of 42 percent renewable sources, three times the global average.

But the country also hopes to become a major oil exporter, thanks to the 2006 discovery of the “pre-salt” wells – huge reserves of crude under a thick layer of salt far below the surface, 300 km from the coast.

Megaprojects involving the construction of refineries and petrochemical plants, dozens of shipyards that mushroomed up and down the coast, and the dream of turning the new oil wealth into a better future lost their charm in the face of the corruption scandal that broke out in 2014, revealing the embezzlement of billions of dollars from the state oil giant Petrobras.

Nearly 200 people are facing charges in the scandal for paying or receiving kickbacks for inflated contracts. Around 50 of them are politicians, most of them still active members of Congress.

The heads of the country’s biggest construction companies were arrested, which dealt a blow to the real estate market and major infrastructure works nationwide.

The investigations took on momentum when over 30 of those facing prosecution struck plea bargain deals, agreeing to cooperate in exchange for shorter sentences.

The scandal is one of the main elements in the economic and political crisis shaking the country, which saw an estimated drop in GDP of more than three percent in 2015, rising inflation, a dangerously high fiscal deficit, a threat of impeachment hanging over President Dilma Rousseff and chaos in parliament.

Besides the corruption scandal, Petrobras has been hit hard by the collapse of oil prices, which has threatened its investment in the pre-salt reserves, and by the losses it accumulated during years of government fuel-price controls.

The government took advantage of Petrobras’ monopoly on refining to curb inflation by means of price controls, mainly for gasoline.

But the oil company scandal, which broke out after the October 2014 elections in which Rousseff was reelected, fuelled the growth of inflation, to over 10 percent today.

With Petrobras in financial crisis and selling off assets to pay down its debt, none of the four planned refineries has been completed according to plan. The only one that was finished is operating at only half of the planned capacity.

Most of the shipyards, which were to supply the oil drilling rigs, offshore platforms and tankers involved in the production of pre-salt oil, have gone under, and the government’s plans to build a strong naval industry have floundered.

The priority put on oil production, to the detriment of the fight against climate change, along with subsidised gasoline prices dealt a major blow to ethanol, which was enjoying a new boom since the emergence in 2003 of the flexible fuel vehicle, specially designed to run on gasoline or ethanol or a blend of the two.

The innovative new technology revived consumer confidence in ethanol, which had been undermined in the previous decade due to supply shortages. With the flex-fuel cars, consumers no longer had to depend on one kind of fuel and could choose whichever was cheaper at any given time.

The use of ethanol, which is consumed in nearly the same quantities as gasoline in Brazil, broke the monopoly of fossil fuels, making a decisive contribution to the rise in the use of renewable energies.

But gasoline price subsidies drove many ethanol plants into bankruptcy and led to the sale of one-third of the sugarcane industry to foreign investors. Many local companies, facing financial disaster, sold their sugar mills and distilleries to transnational corporations like Bunge, Cargill, Louis Dreyfus and Tereos.

Brazil has practically given up on the idea of creating an international market for ethanol, after initially encouraging consumption and production of the biofuel made from sugarcane. Former president Luiz Inacio Lula da Silva (2003-2010) was very active in this campaign, unlike his successor Rousseff.

Part of what will be the Belo Monte hydroelectric plant’s turbine room in the northern Brazilian state of Pará – a mega-project which is 80 percent complete and is set to be finished in 2019. Credit: Mario Osava/IPS

Part of what will be the Belo Monte hydroelectric plant’s turbine room in the northern Brazilian state of Pará – a mega-project which is 80 percent complete and is set to be finished in 2019. Credit: Mario Osava/IPS

Hydroelectricity

Another decisive factor in achieving a more renewables-heavy energy mix is the predominance of hydroelectricity in the generation of electric power. In recent years, wind power has grown fast, and the use of biomass from sugarcane bagasse has also expanded, although to a lesser extent.

But the construction of giant hydropower dams in the Amazon jungle, such as Belo Monte on the Xingú River, has drawn strong opposition from indigenous communities and environmentalists, which, along with legal action by the public prosecutor’s office, has brought work on Belo Monte to a halt dozens of times.

As a result, work on the dam has been delayed by over a year. One of the latest legal rulings suspended the plant’s operating permit, and could block the filling of the reservoirs, which was to start in March this year.

When the plant comes fully onstream in 2019, Belo Monte will have an installed capacity of 11,233 MW. But during the dry season, when water levels in the river are low, it will generate almost no electric power. The flow of water in the Xingú River varies drastically, and the reservoir will not store up enough water to fuel the turbines during the dry months.

The dam has come under harsh criticism, even from advocates of hydropower, such as physicist José Goldemberg, a world-renowned expert on energy.

The controversy surrounding Belo Monte threatens the government’s plans for the Tapajós River, to the west of the Xingú River – the new hydroelectric frontier in the Amazon. For the last two years, the Rousseff administration has been trying to find investors to build and operate the São Luiz del Tapajós dam, which would generate 8,040 MW of electricity.

The presence of the Munduruku indigenous community along that stretch of the river and in the area of the São Luiz dam has stood in the way of the environmental licensing process.

The diversity of sources in Brazil’s energy mix, lessons learned from earlier negative experiences, and the complexity of the integrated national grid make decisions on energy almost a game of chance in this country.

Hydroelectric dams built in the Amazon rainforest in the 1980s, like Tucuruí and Balbina, caused environmental and social disasters that tarnished the reputation of hydropower. Belo Monte later threw up new hurdles to the development of this source of energy.

Another alternative source, nuclear energy, also brought negative experiences. Completion of the country’s second nuclear plant, still under construction in Angra dos Reis, 170 km from Rio de Janeiro, has long been delayed.

It formed part of a series of eight nuclear power plants that the military decided to build, during the 1964-1985 dictatorship, signing an agreement in 1975 with Germany, which was to provide technology and equipment.

Economic crisis brought the programme to a halt in the 1980s. One of the plants was completed in 2000 and the other is still being built, because the equipment had already been imported over 30 years ago. The final cost overruns will be enormous.

For the government and the different sectors involved in policy-making in the energy industry, giving up hydropower is unthinkable.

But the advances made in wind power, new energy storage technologies, and especially the reduction of costs in the production of solar power increase the risk of making large hydropower dams, which are built to operate for over a hundred years, obsolete.

Edited by Estrella Gutiérrez/Translated by Stephanie Wildes

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Hydropower at Front and Centre of Energy Debate in Chile, Once Againhttp://www.ipsnews.net/2016/01/hydropower-at-front-and-centre-of-energy-debate-in-chile-once-again/?utm_source=rss&utm_medium=rss&utm_campaign=hydropower-at-front-and-centre-of-energy-debate-in-chile-once-again http://www.ipsnews.net/2016/01/hydropower-at-front-and-centre-of-energy-debate-in-chile-once-again/#comments Wed, 27 Jan 2016 00:09:26 +0000 Marianela Jarroud http://www.ipsnews.net/?p=143702 General Carrera Lake, the second-largest in South America, in the Aysén region in Chile’s southern Patagonia wilderness, a place of abundant water resources.  Credit: Marianela Jarroud/IPS

General Carrera Lake, the second-largest in South America, in the Aysén region in Chile’s southern Patagonia wilderness, a place of abundant water resources. Credit: Marianela Jarroud/IPS

By Marianela Jarroud
SANTIAGO, Jan 27 2016 (IPS)

The Chilean government’s approval of a hydroelectric dam in the Patagonia wilderness has rekindled the debate on the sustainability and efficiency of large-scale hydropower plants and whether they contribute to building a cleaner energy mix.

“Hydroelectricity can be clean and viable, but we believe every kind of energy should be developed on a human scale, and must be in accordance with the size and potential of local communities,” Claudia Torres, spokeswoman for the Patagonia Without Dams movement, told IPS.

She added that “there are different reasons that socioenvironmental movements like ours are opposed to mega-dams: because of the mega-impacts, and because of the way this energy is used – to meet the needs of the big mining corporations that are causing an environmental catastrophe in the north of the country.”

The movements fighting the construction of large dams in the southern Patagonian region of Aysén suffered a major defeat on Jan. 18, when the plan for the 640 MW Cuervo dam was approved.

This South American nation of 17.6 million people has a total installed capacity of 20,203 MW of electricity. The interconnected Central and Norte Grande power grids account for 78.38 percent and 20.98 percent of the country’s electric power, respectively.

Of Chile’s total energy supply, 58.4 percent is generated by diesel fuel, coal and natural gas. The country is seeking to drastically reduce its dependence on imported fossil fuels, to cut costs and to meet its climate change commitments.

Large-scale hydropower provides 20 percent of the country’s electricity, while 13.5 percent comes from unconventional renewable sources like wind and solar power, mini-dams and biomass.

Chile has enormous potential in unconventional renewable sources. In 2014, the government of Michelle Bachelet adopted a new energy agenda that set a target for 70 percent of Chile’s electric power to come from renewables by 2050.

In terms of water resources, Chile has 6,500 km of coastline, 11,452 square km of lakes, and innumerable rivers.

Aysén, in the extreme south of the country, has abundant water resources – fast-flowing rivers, numerous lakes, and distinctive lagoons. General Carrera Lake, the second-largest in South America after Bolivia’s Titicaca, is found in that region.

To generate hydroelectricity, the authorities and investors have their eyes on the wild rivers of Patagonia, a remote, untamed, unspoiled and sparsely populated wilderness area at the far southern tip of Chile.

But vast segments of civil society reject large hydropower dams, which they consider obsolete and a threat to the environment and to local communities.

However, Professor Matías Peredo, an expert on hydropower at the University of Santiago de Chile, says that thanks to the country’s abundant water resources, hydroelectricity is “one of the energy sources with the greatest potential for development.”

“It’s always good to diversify the energy mix, and well-managed hydroelectricity is quite sustainable,” he told IPS.

The expert argued that a properly managed hydropower dam “is better from an environmental and social point of view than a string of small dams that together provide the same number of MW of electric power.”

Ensuring that a hydroelectricity plant is well-managed means avoiding major fluctuations, Peredo said.

“Hydropower generation in Chile depends on demand and the plant’s load capacity….In other words, the plant can only operate with prior authorisation from the Superintendencia de Electricidad y Combustibles (the country’s power regulator), and depending on the availability of water,” he said.

“This combination means the hydroelectric plant operates on and off, thus generating large fluctuations in flow, which is a major stress for the ecosystem,” he said.

The law to reform the energy industry and foment unconventional renewable sources includes in this category hydropower dams of up to 20 MW – in other words, mini-dams.

Environmental organisations like Ecosistemas maintain that large hydroelectric dams have extremely negative social and environmental impacts.

These include the flooding of large areas of land, which destroys flora and fauna, and the modification of rivers, which causes bioecological damage.

And the negative social impacts of large dams are proportional to the multiple environmental impacts, displacing millions of people: between 40 and 80 million people were forcibly evicted for the construction of large dams worldwide between 1945 and 2000, according to the World Commission on Dams (WCD).

“It is important to diversify the energy mix, for local use, with good support, clean energy sources, and considerably fewer impacts, while strengthening consumption and development in the territories,” said Torres, the Patagonia Without Dams activist, from Coyhaique, the capital of the Aysén region.

“Decentralised power generation is key” to moving forward in terms of clean, sustainable energy, she said, adding that the people of Aysén are seeking to expand the use if wind, solar and tidal power in the region.

Peredo agreed that the decentralisation of power generation is of strategic importance.

“Distributed generation (power generation at the point of consumption) must without a doubt be discussed in this country. It makes a lot of sense for electricity to be produced locally,” he said.

In 2014 the Patagonia Without Dams movement won a major victory when the government cancelled the HidroAysén project, which would have built five large hydropower dams on wilderness rivers in Aysén to generate a combined total of 2,700 MW of energy.

But now the movement was dealt a blow, with the approval by a special Committee of Ministers of the construction of the Cuervo dam – a decision that can only be blocked by a court decision.

The project, developed by Energía Austral, a joint venture between the Swiss firm Glencore and Australia’s Origin Energy, would be built at the headwaters of the Cuervo River, some 45 km from the city of Puerto Aysén, the second-largest city in the region after Coyhaique, for a total investment of 733 million dollars.

Energía Austral is studying the possibility of a submarine power cable and an aerial submarine power line, to connect to the central grids.

The controversy over the plant has heated up because it would be built in the Liquiñe-Ofqui geological fault zone, an area of active volcanoes.

“It poses an imminent risk to the local population,” Torres warned.

Peredo said “the project was poorly designed from the start, and will not be managed well.”

“They failed to take into consideration important aspects, such as the connection of the Yulton and Meullín rivers at some point, which could have disastrous consequences for the ecosystem,” he said.

Opponents of the dam say they will go to the courts and apply social and political pressure, in a year of municipal elections.

“We have one single aim: to keep any dams from being built in Patagonia, and that’s what’s going to happen,” Torres said.

Edited by Estrella Gutiérrez/Translated by Stephanie Wildes

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Innovative Project to Provide Renewable Energy 24/7 to Chilean Villagehttp://www.ipsnews.net/2016/01/innovative-project-to-provide-renewable-energy-247-in-chilean-village/?utm_source=rss&utm_medium=rss&utm_campaign=innovative-project-to-provide-renewable-energy-247-in-chilean-village http://www.ipsnews.net/2016/01/innovative-project-to-provide-renewable-energy-247-in-chilean-village/#comments Fri, 15 Jan 2016 16:52:55 +0000 Marianela Jarroud http://www.ipsnews.net/?p=143604 The fishing village of Caleta San Marcos in northern Chile, 100 km from Iquique and 1,800 km north of Santiago, will be the site of an innovative project, Espejo de Tarapacá, that will combine renewable sources to provide the local residents with a steady 24/7 energy supply. Courtesy Valhalla Energía

The fishing village of Caleta San Marcos in northern Chile, 100 km from Iquique and 1,800 km north of Santiago, will be the site of an innovative project, Espejo de Tarapacá, that will combine renewable sources to provide the local residents with a steady 24/7 energy supply. Courtesy Valhalla Energía

By Marianela Jarroud
SANTIAGO, Jan 15 2016 (IPS)

A novel energy project in Chile will combine a pumped-storage hydroelectric plant operating on seawater and a solar plant, to provide a steady supply of clean energy to a fishing village in the Atacama Desert, the world’s driest.

The idea may seem unlikely, given the extreme aridity and lack of water in northern Chile, where copper, gold and silver mining corporations use most of the water and energy consumed.

But the initiative has drawn the interest of local and foreign investors. And in 2015 it won the Avonni National Innovation Award granted by the Chilean Innovation Forum, the National TV Station TVN, El Mercurio – the country’s largest newspaper – and the Economy Ministry.

“Nowhere in the world have they managed to offer clean energy 24/7 at competitive prices, without subsidies,” said Juan Andrés Camus, general manager and one of the two founders of Valhalla Energía, the local company that is carrying out the project.

“The convergence of these three elements is unique, and it’s not a stroke of genius on our part but a wonderful gift of nature,” he told IPS.

The company was founded on the premise that Chile is a country that is poor in the “energies of the past, but infinitely rich in energies of the future.”

With an investment of 400 million dollars, the Espejo (Mirror) de Tarapacá will essentially operate as a big battery that will store up energy. Construction is to begin in late 2016 and it is set to come onstream in 2020.

The project includes the installation of a pumped-storage hydroelectric plant, which will pump seawater up a cliff on the coast using solar energy, to a natural storage basin at an altitude of 600 metres.

In the night-time, when no solar energy is available, the plant will generate electricity by releasing the stored water, which will rush down through the same tunnels. This will provide a steady round-the-clock supply of energy – 24 hours a day/seven days a week – overcoming the problem of intermittency of renewable energy sources.

Scale model of Espejo de Tarapacá, a renewable energy project that will take advantage of Chile’s coastal geography, with a cliff where seawater will be pumped up to a natural storage basin at an altitude of 600 metres, in the extreme north of the country. Credit: Courtesy Valhalla Energía

Scale model of Espejo de Tarapacá, a renewable energy project that will take advantage of Chile’s coastal geography, with a cliff where seawater will be pumped up to a natural storage basin at an altitude of 600 metres, in the extreme north of the country. Credit: Courtesy Valhalla Energía

El Espejo will generate 300 MW of electricity in Caleta San Marcos, in the extreme northern region of Tarapacá, 100 km south of the city of Iquique.

At the same time, the company will build Cielos de Tarapacá, a 1,650-hectare solar park in nearby Pintados that will produce 600 MW of energy, with a projected investment of nearly one billion dollars.

The solar project, which is waiting for an environmental permit, will operate with single-axis tracking technology in order to follow the sun during the day from east to west.

Camus said the solar park will be so large that “if it began to operate in 2015 it would be the biggest in the world.”

At night, the plant will continue generating solar power, thanks to the energy stored in Espejo.

The salient aspect of the two projects is that they will harness the natural attributes that Chile has in abundance: seawater, coastal cliffs, and the Atacama Desert’s solar radiation.

This will avoid the need to build dams and reduce construction of underground tunnels by up to 80 percent, according to the promoters of the project, who say it is one of the most innovative renewable energy initiatives in the world.

“More than in the technology employed, the innovation of Espejo de Tarapacá lies in the more efficient use of geography, which makes it possible to build the plant at the lowest possible cost,” said Camus.

“The big opportunity is in the efficient use of the territory, more than in the technological barrier,” he added. Chile is a long, narrow country between the Pacific Ocean to the west and the Andes mountains to the east. It has 6,435 km of coast line.

Valhalla has been working closely with the people of Caleta San Marcos.

The fishing village’s 300 inhabitants, who make a living from small-scale fishing and harvesting shellfish and giant kelp, were initially wary, afraid the initiative would have a negative impact on local marine resources.

Working groups were set up to discuss things with the local community, who asked for advisers with expertise in marine issues and a lawyer to support them in technical and legal aspects.

Finally, after months of work, the company signed agreements with the local fishing union and the residents’ association pledging to make contributions to the local community. They also agreed on a set of principles to guarantee transparent management of the plant, as well as a mechanism to address problems in case damage to the sea is detected.

Aerial view of the area where the Espejo de Tarapacá project will be built, to produce 300 MW of electricity using seawater and solar energy, in an innovative plant that will generate energy 24/7 in the Atacama Desert in northern Chile. Credit: Courtesy of Valhalla Energía

Aerial view of the area where the Espejo de Tarapacá project will be built, to produce 300 MW of electricity using seawater and solar energy, in an innovative plant that will generate energy 24/7 in the Atacama Desert in northern Chile. Credit: Courtesy of Valhalla Energía

“This has been beneficial, and I hope other communities can have access to this and will be able to decide for themselves, but with information, equal opportunity, while defending their rights, so that ignorance doesn’t become a curb on development,” said Genaro Collao, president of the local fishing union of Caleta San Marcos.

“At this tipping point the decision is: I put money in your pocket or I improve your life,” he told IPS by phone from the village. “Money in my pocket is going to last one day, one week, one month. But life is an ongoing legacy, that’s the concept.”

This South American nation of 17.6 million people has a total installed capacity of 20,203 MW of electricity. The interconnected Central and Norte Grande power grids account for 78.38 percent and 20.98 percent of total electric power, respectively.

Of the country’s total energy supply, 58.4 percent is generated by diesel fuel, coal and natural gas, while the rest comes from renewable energy sources – mainly large hydropower dams.

Only 13.5 percent comes from unconventional renewable sources like wind power (4.57 percent), solar (3.79 percent), mini-dams (2.8 percent) and biomass (2.34 percent).

In 2014, the government of Michelle Bachelet adopted a new energy agenda that set a target for 70 percent of Chile’s electric power to come from renewable sources by 2050.

“Seventy percent of the greenhouse gases in Chile come from the energy sector,” Environment Minister Pablo Badenier has told IPS. “That means it is our commitments in energy that will enable us to live up to the pledge to cut emissions by 30 percent by 2030.”

“Looking at the 2050 energy road map, it appears viable that by the year 2050, 70 percent of power generation in Chile could come from renewable sources. That is what makes it possible to seriously commit to this goal regarding greenhouse gases.”

Studies indicate that Atacama has one of the highest concentrations of solar energy in the world. According to experts, the entire country could be supplied with electricity if less than 0.5 percent of the desert’s surface were covered by solar panels.

“Projects like this one could offer an opportunity by putting Chile at the forefront of development of green technology that does not require people to pay more for it,” said Camus.

Edited by Estrella Gutiérrez/Translated by Stephanie Wildes

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Soy Boom Revives Amazon Highwayhttp://www.ipsnews.net/2016/01/soy-boom-revives-amazon-highway/?utm_source=rss&utm_medium=rss&utm_campaign=soy-boom-revives-amazon-highway http://www.ipsnews.net/2016/01/soy-boom-revives-amazon-highway/#comments Fri, 08 Jan 2016 00:09:44 +0000 Fabiana Frayssinet http://www.ipsnews.net/?p=143536 A local small farmer, Rosineide Maciel, watches the road improvement works on highway BR-163, which runs past her house in Itaituba municipality in the northern Brazilian state of Pará. Credit: Fabiana Frayssinet/IPS

A local small farmer, Rosineide Maciel, watches the road improvement works on highway BR-163, which runs past her house in Itaituba municipality in the northern Brazilian state of Pará. Credit: Fabiana Frayssinet/IPS

By Fabiana Frayssinet
MIRITITUBA, Brazil , Jan 8 2016 (IPS)

The BR-163 highway, an old dream of the Brazilian military to colonise the Amazon jungle, was revived by agroexporters as part of a plan aimed at cutting costs by shipping soy out of river ports. But the improvement of the road has accentuated problems such as deforestation and land tenure, and is fuelling new social conflicts.

The 350-km stretch of road between the cities of Miritituba and Santarem in the northern Brazilian state of Pará look nothing like the popular image of a lush Amazon rainforest, home to some of the greatest biodiversity in the world.

Between the two port terminals – in Santarém, where the Tapajós and Amazon Rivers converge, and in Miritituba on the banks of the Tapajós River – are small scattered groves of trees surrounded by endless fields of soy and pasture.

Cattle grazing peacefully or resting under the few remaining trees, taking shelter from the high temperatures exacerbated by the deforestation, are the only species of mammal in sight.“A common phrase heard in the area along the BR-163 is ‘whoever deforests, owns the land’ – in other words, deforestation has become an illegal instrument for seizing public land.” – Mauricio Torres

“When we came here 30 years ago this was all jungle,” local small farmer Rosineide Maciel told IPS as she and her family stood watching a bulldozer flatten a stretch of the BR-163 highway in front of their modest dwelling.

Maciel doesn’t miss the days when, along with thousands of other Brazilian migrants, she was drawn here by the then-military government’s (1964-1985) offer of land, part of a strategy to colonise the Amazon rainforest.

Thanks to the paving of the highway that began in 2009, it takes less time to transport her cassava and rice to the town of Rurópolis, 200 km from her farm.

“It’s been easier since they improved the road,” she said. “In the past, there were so many potholes on the way to Rurópolis, and in the wet season it took us three days because of the mud.”

BR-163, built in the 1970s, had become practically impassable. The road links Cuiabá, the capital of the neighbouring state of Mato Grosso – the country’s main soy and corn producer and exporter – with the river port city of Santarém.

Of the highway’s 1,400 kilometres, where traffic of trucks carrying tons of soy and maize is intense, some 200 km have yet to be paved, and a similar number of kilometres of the road are full of potholes.

Accidents occur on a daily basis, caused in the dry season by the red dust thrown up on the stretches that are still dirt, and in the wet season by the mud.

But compared to how things were in the past, it is a paradise for the truckers who drive the route at least five times a month during harvest time.

Truck driver Pedro Gomes from the north of the state of Mato Grosso told IPS: “When soy began to come to Santarém, three years ago, sometimes the drive took me 10 to 15 days. Today we do it in three days, if there’s no rain.”

The BR-163 highway runs up to the entrance of the port terminal built in Santarém by U.S. commodities giant Cargill, where the company loads soy and other grains to ship down the Amazon River to the Atlantic Ocean, and from there to big markets like China and Europe.

This and other ports built or planned by different companies in Santarém, Miritituba and Barcarena – in Belem, the capital of Pará, at the mouth of the Amazon River – are part of a logistics infrastructure which, along with the paving of the highway, seeks to reduce the costs of land and maritime transport in northern Brazil.

The river ports and the road improvement have nearly cut in half the transport distance for truck traffic from Mato Grosso, which is around 2,000 km from the congested ports in the southeast, such as Santos in the state of São Paulo or Paranaguá in Paraná.

The Mato Grosso Soy Producers Association estimates the transport savings at 40 dollars a ton.

“Shipping out of ports in the north like Santarém has boosted competitiveness,” José de Lima, director of planning for the city of Santarém, told IPS. “BR-163 is a key export corridor that was very much needed by the country and the region.”

But the country’s agroexport model has many critics.

Road works on highway BR-163 in Itaituba municipality in the northern Brazilian state of Pará. Credit: Fabiana Frayssinet/IPS

Road works on highway BR-163 in Itaituba municipality in the northern Brazilian state of Pará. Credit: Fabiana Frayssinet/IPS

With the soy production boom in Pará, illegal occupations of land have expanded and property prices have soared.

“The paving of BR-163 has heated up the land market,” Mauricio Torres, at the Federal University of Western Pará (UFOPA), told IPS. “As this is happening in a region where illegal possession of land is so widespread and where there is no land-use zoning, it generates a series of social and environmental conflicts.”

This, in turn, has driven deforestation.

“Forests are cut down not only for agriculture but to make fraudulent land claims. A common phrase heard in the area along the BR-163 is ‘whoever deforests, owns the land’ – in other words, deforestation has become an illegal instrument for seizing public land,” he said.

In 2006, the government launched a sustainable development plan for BR-163, aimed at reducing the socioenvironmental impacts caused by the paving of the road, by means of self-sustaining projects for local communities.

“But this pretty much just petered out,” UFOPA chancellor Raimunda Nogueira explained to IPS.

“If the communities along BR-163 are not strengthened, they will undergo a radical transformation,” she said. “For example, land prices are skyrocketing and small farmers are selling out, which accentuates the phenomenon of the latifundio (large landed estates).”

Deforestation in the Brazilian Amazon became more widespread in the 1960s, driven by the expansion of cattle ranching and the timber industry.

However, that did not leave the land completely free of vegetation, according to Nogueira, because subsistence farming “maintained different levels of regeneration of the forest.”

“When the big agricultural producers came in, they cleared all of those areas in the stage of regeneration that maintained a certain equilibrium,” said the chancellor, who estimates that around 120,000 hectares of land have been deforested to make way for soy.

Torres, meanwhile, referred to the emergence of other social problems like prostitution, involving minors as well as adults.

“There are towns in Pará that could turn into huge brothels for truck drivers,” he said.

The residents of Campo Verde, a town of around 6,000 people located 30 km from Miritituba, who depend on the production of palm hearts and on sawmills for a living, have started to feel the effects.

The town is located near the intersection of BR-163 and the 4,000-km Trans-Amazonian highway that cuts across northern Brazil.

“Only soy is going to come through here,” Celeste Ghizone, a community organiser in the town, told IPS. “An average of 1,500 trucks are expected to pass through every day. Just think of how many accidents we’re going to have with all of these truck drivers who drive through like mad men without even slowing down,” he said, adding that he is worried about rising crime and drug abuse rates.

When the improvement of BR-163 – including widening it to a four-lane highway along one major stretch – is completed, an estimated 20 million tons of grains (Mato Grosso currently produces 42 million tons) will be shipped northward to Amazon River ports rather than on the longer routes to ports in the southeast, by 2020.

The dream of agribusiness corporations is to continue expanding the soy corridor, by building a railway to Miritituba.

But Torres complained that “It’s important to stress that a paved BR-163 is not local infrastructure but is for the big soy producers of Mato Grosso. The state of Pará will become merely a transport corridor for soy exports.”

Edited by Verónica Firme/Translated by Stephanie Wildes

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Indigenous Villagers Fight “Evil Spirit” of Hydropower Dam in Brazilhttp://www.ipsnews.net/2015/12/indigenous-villagers-fight-evil-spirit-of-hydropower-dam-in-brazil/?utm_source=rss&utm_medium=rss&utm_campaign=indigenous-villagers-fight-evil-spirit-of-hydropower-dam-in-brazil http://www.ipsnews.net/2015/12/indigenous-villagers-fight-evil-spirit-of-hydropower-dam-in-brazil/#comments Mon, 21 Dec 2015 17:28:52 +0000 Fabiana Frayssinet http://www.ipsnews.net/?p=143410 Juarez Saw is the chief of the Sawré Muybu village on the Tapajós River between the municipalities of Itaituba and Trairao in the state of Pará, Brazil. Credit: Gonzalo H. Gaudenzi/IPS

Juarez Saw is the chief of the Sawré Muybu village on the Tapajós River between the municipalities of Itaituba and Trairao in the state of Pará, Brazil. Credit: Gonzalo H. Gaudenzi/IPS

By Fabiana Frayssinet
SAWRÉ MUYBU, Brazil , Dec 21 2015 (IPS)

At dusk on the Tapajós River, one of the main tributaries of the Amazon River in northern Brazil, the Mundurukú indigenous people gather to bathe and wash clothes in these waters rich in fish, the staple of their diet. But the “evil spirit”, as they refer in their language to the Sao Luiz Tapajós dam, threatens to leave most of their territory – and their way of life – under water.

“The river is like our mother. She feeds us with her fish. Just as our mothers fed us with their milk, the river also feeds us,” said Delsiano Saw, the teacher in the village of Sawré Muybu, between the municipalities of Itaituba and Trairao in the northern Brazilian state of Pará.

“It will fill up the river, and the animals and the fish will disappear. The plants that the fish eat, the turtles, will also be gone. Everything will vanish when they flood this area because of the hydroelectric dam,” he told IPS.

The dam will flood 330 sq km of land – including the area around this village of 178 people.

According to the government’s plans, the Sao Luiz Tapajós dam will have a potential of 8,040 MW and will be the main dam in a complex of hydropower plants to be built along the Tapajós River and its tributaries by 2024.

But the 7.7 billion-dollar project has been delayed once again because of challenges to the environmental permitting process.

“The accumulative effect is immeasurable. Environmental experts have demonstrated that it will kill the river. No river can survive a complex of seven dams,” Mauricio Torres, a sociologist at the Federal University of Western Pará (UFOPA), told IPS."No river can survive a complex of seven dams.” -- Sociologist Mauricio Torres

The Tapajós River, which flows into the Amazon River, runs 871 km through one of the best-preserved areas in the subtropical rainforest, where the government whittled away at protected areas in order to build the hydroelectric dams, which are prohibited in wildlife reserves.

The area is home to 12,000 members of the Mundurukú indigenous community and 2,500 riverbank dwellers who are opposed to the “megaproject” – a Portuguese term that the native people have incorporated in their language, to use in their frequent protests.

The Mundurukú have historically been a warlike people, and although they have adopted many Brazilian customs in their way of life, they still wear traditional face paint when they go to the big cities to demonstrate against the dam.

Village chief Juarez Saw complains that they were not consulted, as required by International Labour Organisation (ILO) Convention 169 concerning Indigenous and Tribal Peoples in Independent Countries, which has been ratified by Brazil.

The process of legalisation of their indigenous territory has been interrupted by the hydropower project.

“We aren’t leaving this land,” he told IPS. “There is a law that says we can’t be moved unless an illness is killing indigenous people.”

The village is located in a spot that is sacred to the Mundurukú people. And they point out that their ancestors were born here and are buried here.

“This is going to hurt, us, not only the Mundurukú people who have lived along the Tapajós River for so many years, but the jungle, the river. It hurts in our hearts,” said the village’s shaman or traditional healer, Fabiano Karo.

The interview is taking place in the ceremonial hut where the shaman heals “ailments of the body and spirit.” He fears being left without his traditional medicines when the water covers the land around the village – and his healing plants.

Academics warn that the flooding will cause significant losses in plant cover, while generating greenhouse gas emissions due to the decomposition of the trees and plants that are killed.

 A little girl in Sawré Muybu, an indigenous village on the Tapajós River between the municipalities of Itaituba and Trairao in the northern Brazilian state of Pará. Credit: Fabiana Frayssinet/IPS


A little girl in Sawré Muybu, an indigenous village on the Tapajós River between the municipalities of Itaituba and Trairao in the northern Brazilian state of Pará. Credit: Fabiana Frayssinet/IPS

This biodiversity-rich river basin is home to unique species of plants, birds, fish and mammals, many of which are threatened or endangered.

“The impact will be great, especially on the aquatic fauna, because many Amazon River basin fish migrate from the lower to the upper stretches of the rivers to spawn,” ecologist Ricardo Scuole, at the UFOPA university, explained to IPS.
“Large structures like dikes, dams and artificial barriers generally hinder or entirely block the spawning migration of these species,” he said.

The village of Sawré Muybu currently covers 300 hectares, and the flooding for the hydroelectric dam will reduce it to an island.

María Parawá doesn’t know how old she is, but she does know she has always lived on the river.

“I’m afraid of the flood because I don’t know where I’ll go. I have a lot of sons, daughters and grandchildren to raise and I don’t know how I’ll support them,” Parawá told IPS through an interpreter, because like many women in the village, she does not speak Portuguese.

A few hours from Sawré Muybu is Pimental, a town of around 800 inhabitants on the banks of the Tapajós River, where people depend on agriculture and small-scale fishing for a living.

This region was populated by migrants from the country’s impoverished semiarid Northeast in the late 19th century, at the height of the Amazon rubber boom.

Pimental, many of whose inhabitants were originally from the Northeast, could literally vanish from the map when the reservoir is created.

“With the impact of the dam, our entire history could disappear underwater,” lamented Ailton Nogueira, president of the association of local residents of Pimental.

The consortium that will build the hydroelectric dam, led by the Eletrobrás company, has proposed resettling the local inhabitants 20 km away.

But for people who live along the riverbanks, like the Mundurukú, the river and fishing are their way of life, sociologist Mauricio Torres explained.

“Their traditional knowledge has been built over millennia, passing from generation to generation,” he told IPS. “It is at least 10,000 years old. When a river is dammed and turned into a lake, it is transformed overnight and this traditional knowledge, which was how that region survived, is wiped away.”

The Tapajós River dams are seen by the government as strategic because they will provide energy to west-central Brazil and to the southeast – the richest and most industrialised part of the country.

“The country needs them. Otherwise we are going to have blackouts,” said José de Lima, director de of planning in the municipality of Santarém, Pará.

But the Tapajós Alive Movement (MTV), presided over by Catholic priest Edilberto Sena, questions the need for the dams.

“Why do they need so many hydropower dams on the Tapajós River? That’s the big question, because we don’t need them. It’s the large mining companies that need this energy, it’s the São Paulo and Rio de Janeiro markets that need it,” he told IPS.

It’s evening in Sawré Muybu and the families gather at the “igarapé”, as they call the river. While people bathe, the women wash clothes and household utensils.

From childhood, boys learn to fish, hunt and provide the village with water. For the community, the river is the source of life.

“And no one has the right to change the course of life,” says Karo, the local shaman.

Edited by Verónica Firme/Translated by Stephanie Wildes

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