Ecuador's Water Crisis: Damming the Water Capital of the World

Matt Terry
Saturday, December 15, 2007

Ecuador is a watery wonderland. Although small (it is roughly the size of New Zealand), it is home to more than 2,000 rivers and streams, at least 17 distinct indigenous groups, and the greatest level of biodiversity of any country in the world in relation to its size. Located in the headwaters of the Amazon basin, Ecuador has more available freshwater resources per capita than almost any other country. No wonder it was recently designated the “Water Capital of the World” by the Panamerican Health Organization. Yet despite this apparent abundance of liquid wealth, Ecuador is in the midst of a water crisis.

Most of the nation's water conflicts begin with the lack of solid information. Ecuador does not have a modern hydrological monitoring network to adequately evaluate river flows. Multiple proposals for dam and diversion projects for drinking water, irrigation, and energy production based on “median annual flows” have resulted in unbalanced water-resource planning and prompted the government to grant concessions that exceed the amount of available water. These “median” values are simply the average of the maximum and minimum flows recorded and result in distorted flow projections of up to four times the level that is typically observed. In addition, changing climate trends have altered rainfall patterns while widespread deforestation and poor land management practices have further reduced the capacity of the rivers to maintain stable base flows.

While overly ambitious projects are built without the available water to feed them, existing water infrastructure has been allowed to deteriorate – a condition that leads to acute levels of inefficiency and puts greater demand on water resources. In many cases, municipal drinking water systems register losses of up to 65%. In many irrigation systems, only 15% of the water reaches its intended destination, while the rest is lost to infiltration through unlined canals, breaks, and poor connections. Inevitably, this inefficiency leads to over-consumption, which in turn incites conflict for a limited resource.

In its struggle to meet growing energy demands, reduce emissions of greenhouse gases and lessen dependence on costly fuel imports for thermal generators, Ecuador has proposed the implementation of up to 226 new hydroelectric projects. Unfortunately, Ecuador's past dam projects (which had an installed capacity of 1,750 megawatts in 2006) have a history of being substantially oversized and have left large environmental footprints without delivering the promised energy benefits.

For example, the Daule-Peripa Dam has an installed capacity of 213 MW yet generates an average of only 80 MW. The Paute Dam has an installed capacity of 1,075 MW, yet for several months of the year produces as little as 15% of its installed capacity. Ecuador's highly variable production from hydroelectric projects results in an ever-increasing dependence on fossil fuel imports to cover the energy deficit caused by these highly inefficient dams.

The use of carbon credits as incentives for hydro development is steadily gaining ground in Ecuador. There are currently close to 30 hydro projects applying for consideration under the Clean Development Mechanism, and four of these have already been approved. These projects claim to displace the use of fossil fuels for energy production. In most cases, the projects are not actually replacing a thermal power plant, and may cause other significant environmental impacts. Despite the well-meaning intentions of the program to offset emissions of greenhouse gases, the most positive impact of the program may be a steady bonus in the pockets of hydro developers.

Almost every hydroelectric project being developed in Ecuador faces intense opposition. The lack of transparent and open processes for public participation is a key factor in the widespread conflict and unrest. Many projects are planned and approved without meaningful public input and/or local consent. As a result, protests have become more frequent (and occasionally violent).

The following proposed projects are at the forefront of the debate over water infrastructure in Ecuador:

Baba Multipurpose Project (42 MW): This project would divert water from the Baba River to the existing Daule-Peripa reservoir to boost its capacity for drinking and irrigation water and produce additional hydropower. The project has continued to generate opposition even after the reservoir area was substantially diminished, and the affected population reduced by 90%. The project remains a very sensitive issue, as many of the people who would be affected by the Baba project were already displaced by the Daule-Peripa project and were not adequately compensated.

Topo Hydroelectric Project (29 MW): Rivers often form important cultural and ecological corridors, and prevent the fragmentation of critical habitats. Currently renowned as an international destination for expert kayakers, and designated a “Gift to the Earth” by WWF for its riparian habitat and outstanding biodiversity, the Rio Topo is a unique resource that faces an uncertain future. This proposed hydro project would dewater a significant portion of the river that is home to torrent ducks, newly discovered orchids, and more than 17 rare and endemic plant species. One plant found in the project area is a critically endangered aquatic species at risk of extinction; it depends on dynamic natural flows to maintain its sensitive habitat conditions, and is found nowhere else in the world. Critics question the need to build a hydro project in such a sensitive habitat area and launched legal action to stop it. There is also doubt whether the project will deliver the promised benefits as no flow studies were done directly on the Topo River; instead, the hydrologic data used for the project design was extrapolated from other drainages.

Although the Topo project was originally proposed as a 10 MW run-of-river project, it is now promoted as a 29 MW project, even though the hydrologic studies used for the project design indicate a viable production of only 6-10 MW throughout most of the year. Meanwhile, the company promoting the project has divided local communities and even families by offering incentives and promising benefits. The decisions made regarding this project will set an important precedent for how the government considers existing river users and unique biodiversity in the development of hydroelectric projects.

Proyecto Ríos Orientales: This large-scale, multi-purpose, transcontinental water diversion project would divert water from up to 30 Amazon drainages for the needs of the growing populations on the west slope of the Andes, including the capital city of Quito, whose population is expected to reach three million inhabitants by 2025. Quito’s water utility has already developed several major transcontinental diversion projects, but claims that this project is the only option for providing water to the growing population for the next 50 years. Meanwhile, opponents argue that Quito should first reduce its water consumption, which is one of the highest per capita in Latin America, by modernizing existing infrastructure. Bringing down losses in the system, which run from 36-45%, to acceptable standards could eliminate the need for building new projects and would improve water quality at the same time. The project is currently blocked by legal action from local governments in the Amazon region.

Coca-Codo Sinclair (1,500 MW): Construction began on this project in the mid-1980s, but the project was suspended in 1987 after Volcano El Reventador erupted and devastated the entire region. Although the volcano is still quite active, a new version of the project has been proposed which supposedly takes geologic issues into account and nearly doubles the installed capacity. The project would develop a road and transmission line corridor into a currently roadless, protected area that is part of the Sumaco Biosphere Reserve, and would threaten to de-water San Rafael Falls, which at 146m (480 feet) is the largest waterfall in Ecuador and an incredible scenic attraction.

Regional Integration: A proposed competitive trade route between Asia and Brazil includes Ecuador as a central port connection, land bridge and freshwater shipping channel. The project is part of the South American Regional Infrastructure Integration Initiative (IIRSA). In order for the trade route to be competitive with the Panama Canal, the Napo River would need to be dredged and channelized to maintain a navigable route for heavy barge traffic. Hong Kong-based Hutchison Holdings has already committed over US$520 million to developing the Pacific port terminal in Manta, Ecuador. There is widespread concern about the impacts to the Napo River basin and the indigenous populations and territories along the route, as well as the implications for investment in new water and energy projects that would not otherwise be considered.

Energy Alternatives

While it is generally accepted that hydroelectricity will always be an important part of Ecuador’s energy portfolio, where and how new projects will be developed and the standards to which they will be held are under increasing scrutiny and debate. With nearly every proposed hydro project being blocked by strong opposition, it is clear that alternative renewable energy options must be pursued.

The optimization of existing hydro projects and the modernization of the country’s electrical distribution system are key areas to start. In 2006, there were losses of 3,053,858 MWh in the system, which is equivalent to 23.4% of the energy consumption.

The Ecuadorian Rivers Institute promotes geothermal power as the best option for developing secure and renewable energy in Ecuador. Despite tremendous geothermal potential throughout the Andean subduction zone, with over 500 MW of geothermal sources already identified, none has been developed.

The potential for wind energy is only starting to be explored. The mountain and coastal regions offer many promising options. There are currently three wind power projects being developed in Ecuador that will provide up to 30 MW of renewable energy into the grid.

The possibilities for developing sensible micro hydro projects, novel applications of free-flow kinetic turbines, as well as traditional solar PV present other attractive solutions for remote off-grid areas.

Now is the most critical time for addressing water management issues in Ecuador and exploring viable alternatives, before controversial projects are implemented and unique rivers and watershed habitats are lost forever.

The author is the founder of Ecuadorian Rivers Institute.