"Muddy Waters" Executive Summary

Organized by Glenn Switkes, Edited by Patricia Bonilha
Wednesday, June 25, 2008

Muddy Waters: Impacts of Damming the Amazon's Principal Tributary


The articles in this book are intended to serve as a tool for those who seek to better understand the Madeira River hydroelectric and industrial waterway complex (hidrovia), its history, and its implications for the Amazon region. The initiative to publish this book came from the non-governmental organization Bank Information Center, headquartered in Washington DC, as part of the studies on the projects of greatest impact in the Initiative for the Integration of South American Regional Infrastructure (IIRSA) for its BICECA program. Financial support for this publication came from the Gordon and Betty Moore Foundation, the Kendeda Foundation, the Blue Moon Fund, and the Ford Foundation. International Rivers´ Brazil office coordinated the production of this case study. We are grateful to the experts who wrote articles for this book. Each of them shares our vision of development in the Amazon based upon environmental sustainability and social justice.

Executive Summary

The Madeira River Hydroelectric and Industrial Waterway Complex is a plan for the construction of four large dams in the Madeira River basin. The Madeira is the Amazon´s principal tributary, and besides generating electricity, the dams would flood a series of rapids, permitting barge navigation on the river from the Madre de Dios (Peru) and Beni (Bolivia) Rivers to the Atlantic Ocean. The project is the largest planned within IIRSA, and also involves road connections to Pacific ports.

The first two dams, Santo Antônio (installed capacity 3150 MW), and Jirau (3300 MW), were awarded provisional licenses by the Brazilian Institute for the Environment and Renewable Natural Resources (IBAMA) in July, 2007. The auction to offer Santo Antônio to private investors took place in December, 2007 and was won by a consortium led by state electric company Furnas and private construction company Odebrecht. The right to construct and operate Jirau was auctioned in May, 2008 and won by a consortium led by French energy and water giant Suez. The projects are awaiting construction licenses from IBAMA. A 2,450 km transmission line needs to be built to send the electricity generated by the dams from Porto Velho, Rondônia state to the national grid in Araraquara, São Paulo.

The dams´ high cost has been a source of controversy. In April, 2007, the National Electrical Energy Agency (ANEEL) estimated that Santo Antônio and Jirau would together cost R$25.72 billion (US$15.8 billion at exchange rate of June, 2008), not including the cost of the transmission line, estimated at between US$3 and $6 billion. Exclusive contracts between project proponent Odebrecht and equipment suppliers were seen as an impediment to fair competition in the auction.

The licensing process for the hydroelectric dams was extremely controversial, and was marked by strong pressure by the Brazilian government for approval, in contrast to opinions by independent experts attesting to the project´s serious impacts. IBAMA´s technical staff recommended against licensing the dams on the basis that new studies covering a broader geographical area and examining additional issues were needed. Despite this fact, IBAMA´s directors caved in to political pressure and issued the license.

The Environmental Impact Studies were tainted from the outset. Their terms of reference restricted studies to a limited stretch of the Madeira between Porto Velho and the Bolivian border, excluding an analysis of impacts on neighboring Bolivia. Bolivia´s Foreign Relations Ministry registered protests with the Brazilian government and initiated a series of technical analyses to shed additional light on the possibility that forests in Pando province would be flooded by the dams. These studies are still being carried out, and it is unclear what position the Bolivian government will finally take in respect to the dams.

The Madeira River dam project provoked strong opposition from environmentalists in Brazil, Bolivia, and various other countries, and the project has come to be seen as emblematic of Brazil´s intentions to exploit the hydroelectric potential of the Amazon, no matter the cost. Social movements in Brazil and Bolivia organized to reject the imposition of a development model which places no value on the traditional way of life of riverbank populations.

In Muddy Waters, Bolivian hydrologist Jorge Molina Carpio analyzes official data on the hydrology of the Madeira River from the Feasibility and Environmental Impact Studies for Santo Antônio and Jirau dams. The author notes that the Madeira, which flows from the Andes Mountains, is one of the world´s most sediment-laden rivers, carrying the greatest amount of sediments of any tributary in the lower Amazon. Its volume of sediments is increasing, probably due to deforestation in the upper basin.

Molina observes that the studies carried out by Odebrecht and Furnas used methodologies which gave preliminary indications only, and that more sophisticated studies would be needed in order to come to conclusions regarding sediment deposits in the reservoirs and upstream. Despite the fact that hydro-sedimentological analyses were later developed in greater detail than those originally carried out, Molina finds that the official studies did not look at the relationship between water levels and the effects of sedimentation.

He concludes that both water levels and the velocity of the Madeira will be affected in the river´s bi-national stretch (upstream from Abunã, Rondônia), with river levels rising several meters and flooding Bolivian territory. Sedimentation will be a gradual process, and could result in the dams reaching the end of their useful life far ahead of the 50 years (in the case of Jirau) and 100 years (in the case of Santo Antônio) predicted in official studies, compromising their economic viability. Scientists Bruce Forsberg and Alexandre Kemenes also criticized calculations regarding the area that would be flooded by the dams. They say that it could be double the area indicated in official studies.

Molina stresses that additional studies are needed, utilizing a hydrodynamic model linked to a sediment transport model, in order to determine with greater precision the effect the dams would have on the hydrology of the Madeira River. The project proponents have no plans to carry out such studies before the dams are built.

Biologist Geraldo Mendes dos Santos, researcher at the National Institute for Amazon Research (INPA), looks at the dams´ probable impacts on fish. The Environmental Impact Studies identified 459 fish species on the stretches of the Madeira that would be potentially impacted by the hydroelectric project. Besides directly and immediately affecting migratory fish, Mendes dos Santos finds the dams would also fragment populations, and erode genetic stocks.

Downstream, erosion and loss of nutrients could affect species such as the freshwater shrimp, which are very important to the aquatic food chain. The rapids which would be submerged by the dams currently serve as the habitat for some species and a site for feeding and reproduction - these species would have their life cycle altered by the dams, diminishing their chances for survival.

There would also be a significant transformation in the diversity of fish in the region. Bottom-feeders and those accustomed to strong currents, such as bagres, bodós and bacus, and fish with scales such as pescadas, jacundás, canivetes and sarapós would be among those negatively affected, possibly disappearing from the area.

Dos Santos also observes that large migratory fish, such as the piramutaba and dourada annually migrate more than 3,000 km from the Amazon River estuary, and the dams would function as physical barriers to their passage, this being the most obvious negative impact on fish species. These species are born and reproduce in the headwaters of various "whitewater" rivers, such as the Juruá, Purus, Madeira, Içá, Japurá, and others; they feed in the estuary at the mouth of the Amazon, and mature in central Amazonia.

The piramutaba and dourada are the preferred catch for fishermen in nearly the entire area where they are found, with about 24,000 tons being caught annually. There are two principal areas in which they are caught- one downstream between Santarém and Belém and one further upstream in the upper Amazon River. In this sense, the impacts of the Madeira River dams on fish will also be felt in other regions, especially in the middle Amazon, where the fish that reproduce on the Madeira are an important component of regional fisheries, as well as in affecting fish populations in the Amazon estuary and the foothills of the Andes.

If the dam poses an impassible barrier for the fish, and the fish passage mechanisms proposed in the mitigation plan function only as a "one-way street", permitting the fish to ascend the river and not to descend, they will never again be able to return to their areas of origin. Their life cycle will not be complete, and losses could be irreparable. Ronaldo Barthem and Michael Goulding in independent expert opinions sounded the alarm regarding the possibility of the dourada becoming extinct as a result of the dams.

The proliferation of some species should also occur, as it is natural that species that are already adapted to the changes that will take place, and which are already found in the Madeira basin, will occupy the new niches available in the reservoir areas. The piranha-caju is a predator species about 25 cm in size which form large schools that voraciously feed on other fish. If this species were to proliferate in the reservoir, it would have a strong and negative impact on fishing, because it has very low commercial value and is also dangerous, having very sharp teeth capable of mutilating fishermen.

Erin Barnes´ study seeks to quantify the possible economic damages that the dams would cause to fishing and fisherfolk along the Madeira between Porto Velho and Guajará-Mirim, Rondônia. Through interviews with fishermen on income and costs, she calculates the fishermen´s current income.

In general, fishermen from the population centers of Porto Velho and Guajará-Mirim have higher incomes, because there are better opportunities for commercial fishing and for selling their catch to urban markets. The riverbank populations in smaller villages, such as Cachoeira Teotônio, Jacy-Paraná, Nova Mamoré, Vila Murtinho, and Jirau tend to fish more to feed their families, or to sell for a little extra income.

The Fishermen´s Association Colônia Z-1 of Porto Velho accounted for 407 tons of fish sales in 2004, Porto Velho being the most important market in the region. Colônia Z-1 has 1,925 licensed fishermen, and estimates point to 400 additional unlicensed fishermen, for a total of 2,325. Barnes estimates the total number of fishermen in the stretch of the Madeira River directed affected by the dams to be between 2,853 and 4,825 (the latter more probable).

She calculates the annual income of fishermen in this stretch to be US$35 million, and the present value of the fish resources in the region to be between US$866 million and US$1.325 billion. The Madeira hydroelectric project puts this value at risk, and in particular its potential impacts on highest-value fish species, both from the commercial and cultural points of view - the dourada and large catfish - would cause enormous losses to families in the region.

Zuleica C. Castilhos and Ana Paula Rodrigues, of the Center for Mineral Technology (Cetem), contribute an article which explains the impacts caused by methylation of mercury and its bio-accumulation in fish, consumption of fish being the only pathway of human exposure. The potential for methylation in the stretch of the Madeira which would be dammed exists since gold mining (garimpos) on the river has been taking place since the beginning of the 1970´s. There are still many gold mines along the river, among which are Penha, Taquaras, Araras and Periquitos, which use mercury as an amalgam for the gold.

Currently, gold mines on the Beni River in Bolivia, and on its tributary, the Madre de Dios River, are also active, and so an influx of mercury from mining in the Madeira basin will continue after the impoundment of the reservoirs.

For each kilogram of gold produced, between two and four kg of mercury are released into the environment. Estimates are that 50-60% of the mercury used in the Madeira River gold mines was lost into the atmosphere during the process of burning the amalgam, with an additional 5% vaporized during extraction of the gold. At the height of gold mining on the Madeira during the 1980´s, emissions of mercury into the environment reached 12 tons annually.

In general, the soils in the Madeira drainage present mercury concentrations higher than those in other regions. It is believed that this mercury could enter water courses through burns and deforestation, in addition to surface runoff from humid deposits and erosion. The combination of mercury present from high natural concentrations and from emissions from gold mining means the methylation of mercury in the Madeira reservoirs could cause extremely toxic concentrations.

Toxic effects of mercury are neurological, affecting both adults and children, although the intensity of toxic effects depends not only on the dose, but also on the maturity of the Central Nervous System exposed. The most serious toxic effects are on developing organisms - in the fetus, intra-uterine. Pregnant women eating fish containing methyl mercury (MeHg), even if not presenting symptoms of intoxication, have elevated blood levels of MeHg. Passing through the placenta, MeHg affects the Central Nervous System of the embryo, negatively affecting its development.

The Minimata Syndrome, caused by mercury poisoning, is characterized by a series of simultaneous neurological symptoms, including visual disturbances, incapacity of muscular coordination, loss of motor control, muscular tremors, and paralysis, potentially even leading to death.

Since riverbank populations eat far more fish than the average population, they are more susceptible to ingestion of mercury in fish. It is also noted that the concentration of mercury in fish that can be damaging to human health is much lower than official health standards.

One condition of the provisional license is that the companies clean up deposits of mercury identified during the construction process, although it appears that the mitigation plan is inadequate to guarantee that potential public health threats of mercury will be adequately addressed.

The probable socio-economic effects of the Madeira Hydroelectric Complex in a regional context are the theme of the article "Economic and Social Transformations" by Aguiar Soares et al. The article notes that the lower Madeira is being utilized as an industrial waterway for transport of soybeans by the Maggi Group and for transport of timber by Veracel.

In this context, devastation in the Madeira basin is already widespread. There are plans to pave the BR-319 highway (Porto Velho - Manaus), which has been impassible for more than a decade. The area where the BR-319 crosses the Transamazon Highway (downstream from Porto Velho) is the focus of intense land conflicts. Companies such as Gethal (with transnational capital) are cutting timber from former rubber-gathering areas and the government of Amazonas State established what it calls a "green free port" in the area, oriented towards agribusiness. A silvinite mine is also being planned in Nova Olinda do Norte, 126 km from Manaus.

Other independent experts warn of the proliferation of vectors of malaria, a disease which is endemic to the region, and of serious social impacts caused by the migration of thousands of people to Porto Velho in search of employment in dam construction.

Human rights groups point to the existence of still un-contacted indigenous groups on the left bank of the Madeira River, who could be impacted by the rising waters of the reservoir or lose their hunting grounds.

Besides the articles by researchers that are mentioned above, three additional sections complement the information in this book: "An Environmental Impact Assessment full of flaws", "Unanswered questions", and "With political will, things could be done differently".

The first of these sections is a selection of key questions raised by independent specialists which were culled from documents produced under an agreement between the Rondônia State Public Attorney´s office and Odebrecht and Furnas in 2006.

Under the agreement, 19 noted specialists were paid by the companies to analyze the official studies. Their conclusions question not only the legitimacy of the documents produced during the licensing process, but also the viability of the project itself. They point out the inadequacy of the terms of reference for the studies developed by IBAMA.

The section "Unanswered questions" lists doubts raised by the technical staff of IBAMA responsible for analyzing the information in the EIA. IBAMA´s technical experts concluded that there was insufficient information to effectively analyze the project´s potential impacts, and recommended that, given the high degree of uncertainty in various aspects of the process, a new Environmental Impact Assessment on a broader scale be carried out, including impacts on neighboring Bolivia and Peru.

In order to present alternatives for Brazilian energy policy that do not require damming the rivers of the Amazon, the section "With political will, things could be done differently" presents some proposals and data regarding responsible consumption of energy, wind potential, dam retrofitting, and small hydroelectric dams, among others. The inclusion of these proposals in this book is intended to indicate their relevance for Brazil´s energy planning and energy policy. Brazil has the means to be able to avoid the enormous irreparable social and environmental impacts caused by large dams in Amazonia by investing in an energy mix which would truly be "clean". What is lacking is the political will to confront the dam building industry.

Finally, "Muddy Waters" reproduces a series of documents from the campaign against the dams, including positions taken by Brazilian and Bolivian social and environmental movements, and official communiqués by the Bolivian government to their Brazilian counterparts.

History will judge the Madeira River Hydroelectric Complex as one of the weakest moments in the Lula administration´s environmental record. The ridiculing of a critical issue like the survival of fish stocks of enormous value, the disdain afforded the concerns of the Bolivian government, and the response to questions raised by local communities on the serious impacts of the Madeira dams is similar to the positions taken by Brazil´s military rulers regarding the impacts of Itaipu, Tucurui, and other monuments to the country´s authoritarian past. Under such avision approach, the people of the Amazon and the rainforest itself are reduced to objects to be subjugated, without public debate.

The staggering preponderance of technical objections to the project should at the very least argue for a thorough weighing of available options and precautions before moving ahead with the project. These objections were ignored in an apparently fraudulent way in the final stages of the rush to license the Madeira dams, as were the voices of social movements who believed that the Lula government would listen to and fully take their concerns into account.