25 June 2010
This past Wednesday, June 16, 2010, the Brazilian president Luis Inacio Lula da Silva and the Peruvian president, Alan Garcia, met in Manaus, in the heart of the Brazilian Amazon, to finalize discussions on an energy agreement.
Flavia Hennessey. June 25, 2010. Washington D.C.
This past Wednesday, June 16, 2010, the Brazilian president Luis Inacio Lula da Silva and the Peruvian president, Alan Garcia, met in Manaus, in the heart of the Brazilian Amazon, to finalize discussions on an energy agreement. The document that was signed at the end of the four-hour meeting does not reflect the ongoing pleas for more planning and more transparency that were made throughout the negotiations that started back in 2006.
The background to the culmination of the process that happened last Wednesday explains why there has been so much commotion in the Peruvian press and not so much amongst the Brazilians. The negotiations between both countries began in 2006. Throughout the process, there has been remarkable dissatisfaction amongst Peru's civil society groups and organizations overseeing the processes taking place. All through the drafting of the deal, there were several instances where the faults of the document were pointed out. Amongst those faults were: lack of planning in both countries in terms of the most adequate way to use the resources produced, and also lack of a plan to mitigate the socio-environmental impacts of the project. [1] The lack of transparency was also an issue and believed by sources, such as the Peruvian newspaper El Comercio, to be due to an inequality in the deal. El Comercio also pointed out that Peru would probably be the one harmed with this deal. [2] Up to this date the document does not address these issues directly.
Marc Dourojeanni, Alberto Barandiarán and Diego Dourojeanni published a book called "Peruvian Amazon in 2021: Exploitation of natural resources and infrastructure: What is going on? What are its implications for the future?” This book was launched in Lima, Peru, in January 2009 [3] and last week in Washington D.C. [4] on the same day of the signing of the deal. In this publication, a comprehensive study of the projects proposed for the Peruvian Amazon from 2010 until 2021 was made. There is an unprecedented amount of projects planned for the years ahead in terms of energy and infrastructure, and several of these projects are located in the Peruvian Amazon. The study points out that if all of these projects are completed, in the best case scenario, the damaged area would comprise 56% of the Peruvian Amazon. The worst case scenario predicts damages of 91% of the jungle area. In addition to pointing out the possible environmental damages of constructing in this sensitive zone, Marc Dourojeanni also questions the benefits for Peru of exploiting its jungle and signing an energy deal with Brazil. "At this point without major information, it is difficult to evaluate whether the undergoing negotiations for Brazil to develop and exploit Inambari and the other dams will represent a benefit for Peru." [5]
Before the treaty was signed, Dourojeanni urged there to be social, environmental and economic studies performed. At the meeting held in Washington D.C. last week, Dourojeanni pointed out that Peru has no form of planning at a national level. Projects are planned at a regional level and taken to the government where they are approved or not. The lack of communication between regions and municipalities has caused there to be a number of overlapping and conflicting projects. In addition, it has also caused there to be an excess of projects in the energy and extractives sector. This excess of projects accounts for the percentages calculated of possible future destruction of the Peruvian Amazon. Since there was a lack of communication amongst regions, there was also a disregard towards the necessary sustainable development plans needed. The final document shows that there were not many changes made to the final draft, since it does not address social issues, and the negotiations on the economic benefits for each country are now on an ongoing condition and conducted internally. Milagros Salazar from the IPS wrote "As it stood in July 2009, the draft agreement established that 80 percent of the energy would go to Brazil and 20 percent to Peru in the first decade. But in the face of protests in Peru, the figures were eliminated from the energy deal, and the proportions are to be negotiated behind closed doors." [6] Alfredo Novoa Pena of the Peruvian institute, ProNaturaleza, states "Peru does not need these dams, we have close to 50,000 MW of renewable energy potential, such as wind, solar and geothermal, that does not include large dams. This deal will only benefit Brazil, and we are not going to let this happen," [7] Novoa’s statement is backed up by the fact that the main dams being constructed in Peru are being led by Brazilian companies. These companies are being backed up by the BNDES, Brazil’s national development bank, which has specific policies regarding projects conducted outside of national territory. The BNDES demands that all equipment and parts used are Brazilian. [8]
Therefore, the question is raised by Dourojeanni: "Which will be the benefits for Peru of a hydroelectric program which, as informed, will be studied, financed, constructed and operated by the neighboring country who will buy the vast majority of the production? Do they not imagine the risk that entails waiting for the hydroelectric power plants to be returned to Peru already sedimented and obsolete despite the fact that Peru must continue paying the gigantic loan embarked on?" [7]
On the other hand, it is not hard to understand Brazil's interest in negotiating with Peru. The demand for energy in Brazil is growing. The first four months of 2010 showed a 9.5% increase in relation to the same period in 2009. [8] The president of the EPE (Energy Research Company) predicts that the majority of Brazil’s energy needs will be supplied by hydroelectric dams. It is clear that Brazil is looking for alternatives beyond its borders to prevent from there being more blackouts in the country. Even though the Brazilian energy crisis is a known fact, the Brazilian president continues supporting the statement that the dams being constructed in Peru are not mainly benefitting Brazil itself, “the energy would be to cater primarily to the Peruvian people, but with these interconnections it would also be possible to benefit the Brazilian people.” [9]
In answer to questions about Peru’s motivations to sign this agreement and harm its jungle, Peru’s Alan Garcia said “it would be worst not to follow through with the hydro plants constructions because, in that case, it would be necessary to go back to relying on coal energy, which would harm the environment more than taking advantage of a small area of the Amazon”. [10] Lula closed the debate on the fairness of the deal and the socio-environmental impacts by stating that "We, the Amazonian countries, have to be careful with the debates on energy and environmental issues”. Every country that plans on constructing hydroelectric plants needs international financial assistance and this discourse is sometimes used to prevent them from getting the funds". [11]
The two main controversial projects that were introduced in 2009 exemplify the issues raised in this article. One of them is the construction of the Inambari dam. The other is the Paquitzapango project. The Inambari would be the largest hydroelectric dam in Peru and the fifth largest in all of Latin America. It would require the flooding of about 46,000 hectares of land [12]. Its massive proportions would mean the displacement of about four-thousand people, according to estimates by IPS’s Milagros Salazar, or 15,000 people according to International Rivers. These numbers include indigenous and mestizo populations which need the land for agriculture and survival. The dam would also flood portions of the inter-oceanic road, a costly enterprise for the Peruvians, and would raise the emissions of green house gases by 5.9 percent [13]. The project would be led by a Brazilian company called Egasur, a joint venture of OAS and Electrobras Furnas. The Paquitzapango project focuses on an area that has a great concentration of indigenous populations, above all the ashaninka peoples. It would displace about 10,000 people according to Milagros Salazar or 17,000 according to International Rivers. The ashaninka peoples have already suffered from displacement because of Peruvian armed conflicts from 1980 to 2000. The project also has a Brazilian company in charge, the Odebrecht Group, which has backing from the Brazilian National Development Bank (BNDES). Both of these projects show the clear social implications these infrastructure works have. Affected communities were not a topic included in the final draft of the document. Mitigation of environmental damages was also not addressed. Furthermore, the development of these projects depends upon Brazilian funding, which implies complying with the conditions imposed by the BNDES.
The document needs to be amended so that it addresses socio-environmental impacts directly. It mentions that projects will be performed in a manner that takes into regard sustainable development, but does not describe any specifics. Negotiations on how the energy produced will be allocated need to be made public. Peruvians are already paying a high price for the lack of planning regarding the projects in the Amazon region with the Inter-oceanic road, and will continue to pay if the government does not invest in long term planning. There has to be a general awareness amongst all regions and municipalities of which projects are being proposed. A national plan for the Amazon region needs to be formulated. This document can be seen as an opportunity for Peru to organize itself and evaluate which projects it can truly benefit from. The document is open for amendments as long as they are done in a mutual consent between both countries. The positive side of the deal is that it a long-term proposal. Several issues arise when countries plan on the short-term and ignore future implications. This should be seen as an opportunity to set out goals for developing interconnections in Latin America in terms of infrastructure but also to develop mechanisms for the protection of the Amazon region and population. Information on the possible extent of the destruction has been published and now should be a time to use it in future planning so that the predictions do not become reality.
sources
. [1] Tratado Energetico Peru-Brasil Bajo la Lupa /es/Article.11761.aspx
. [2] Piden debate de acuerdo energético con Brasil /es/Article.11764.aspx
. [3] ¿El futuro deseado para la Amazonía peruana en 2021? /es/Article.11748.aspx
. [4] SAVE THE DATE: Oil and mining booms and sustainable development /en/Article.11888.aspx
. [5] Questions on hydroelectric power plants in the Peruvian Amazon Region /en/Article.11256.aspx
. [6] Brazilian Dams in Peru's Jungle, to Supply Brazil http://www.ipsnews.net/news.asp?idnews=51866
. [7] Outrage over Peru-Brazil Energy Agreement http://www.internationalrivers.org/en/2010-6-17/outrage-over-peru-brazil-energy-agreement
. [8] Brazilian Dams in Peru's Jungle, to Supply Brazil http://www.ipsnews.net/news.asp?idnews=51866
. [9] Questions on hydroelectric power plants in the Peruvian Amazon Region /en/Article.11256.aspx
. [10] Energia planejada dá conta de um PIB forte http://clippingmp.planejamento.gov.br/cadastros/noticias/2010/6/18/energia-planejada-da-conta-de-um-pib-forte
. [11] Brasil y Perú firman acuerdo de integración energética http://www.hidrocarburosbolivia.com/iberoamerica-mainmenu-98/perinmenu-106/32453-brasil-y-peru-firman-acuerdo-de-integracion-energetica.html
. [12] Brasil y Perú firman acuerdo de integración energética http://www.hidrocarburosbolivia.com/iberoamerica-mainmenu-98/perinmenu-106/32453-brasil-y-peru-firman-acuerdo-de-integracion-energetica.html
. [13] Brasil y Perú firman acuerdo de integración energética http://www.hidrocarburosbolivia.com/iberoamerica-mainmenu-98/perinmenu-106/32453-brasil-y-peru-firman-acuerdo-de-integracion-energetica.html
. [14] Outrage over Peru-Brazil Energy Agreement http://www.internationalrivers.org/en/2010-6-17/outrage-over-peru-brazil-energy-agreement
. [15] Outrage over Peru-Brazil Energy Agreement http://www.internationalrivers.org/en/2010-6-17/outrage-over-peru-brazil-energy-agreement
For more information
. Peru- 6.000 Megawatt Strom aus Amazonas-Regenwald – Pakt mit Brasilien umstritten http://womblog.de/2010/06/23/peru-6-000-megawatt-strom-aus-amazonas-regenwald-pakt-mit-brasilien-umstritten/
. Represas na divisa Brasil e Peru http://eptv.globo.com/emissoras/emissoras_interna.aspx?303650
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