Report: An analysis of the environmental legal status of the Veracruz and Chadín 2 hydropower plant projects in the Marañon river. SPDA (2020) Megadams in the ATLANTIC OCEAN Marañon: Putumayo River status of the Veracruz and Chadín 2 dams Napo River The Veracruz and Chadín 2 hydropower projects have definitive Amazon River concessions, but have not begun construction work, and the reasons Marañon River for which they were promoted are no longer valid. What should the Ucayali River government do? A report by the Peruvian Society of Environmental Law (SPDA) explains the environmental legal status of these projects. MARAÑON RIVER: A KEY ROLE Madre de Dios River l The Marañon river is one of the major rivers connecting the Andes with the Amazon. PACIFIC There has been an unprecedented surge in l It is one of the Amazon river’s main sources of water. OCEAN hydropower projects in the Andes-Amazon l It is 1800 km long and connects 6 Peruvian regions: Huanuco, Ancash, La Libertad, San rivers in recent years. Martin, Cajamarca, Amazonas and Loreto. l Fishing and agriculture depend on the sediments the river transports to the lower basin. DAMS THREATEN THE AMAZON BASIN l The population of the Peruvian Amazon depends on the migration of fish through this In 2012, 151 dams were planned to be constructed over the following 20 years in five of the six tributaries to the river: A WCS (2015) study showed that the Awajun communities near the Rentema Amazon River. 60% of the dams would interrupt the connection between the headlands of the Andes and the canyon consume approximately 500 grams of fish per person per day. lower Amazon. Source: Finer and Jenkins (2012) ECUADOR The Marañon river meets the Ucayali river and together they THE NEGATIVE IMPACTS OF THE VERACRUZ form the Amazon river. Amazon River AND CHADÍN 2 MEGADAMS Marañon River n VERACRUZ IMPOUNDMENT HYDROPOWER PLANT Capacity: 653 MW Definitive concession Ucayali River n CHADÍN 2: IMPOUNDMENT HYDROPOWER PLANT Capacity: 600 MW Definitive concession Over 1500 people would be They would affect the main They would destroy cave The Marañon river canyon displaced. These people source of protein (fish) of paintings in the area that is an adventure tourism BRAZIL are against the construction the communities living in have not been properly attraction, but the of the dams. the river basin. studied by the Ministry of construction of the dams Culture. would hinder its development. n CHILIA IMPOUNDMENT VERACRUZ HYDROPOWER PLANT CHADÍN 2 Capacity: 180 MW HYDROPOWER PLANT HYDROPOWER PLANT p MARAÑON DIVERSION Active project HYDROPOWER PLANT Capacity: 18.4 MW towns towns Built 2011: 20 hydropower plant projects 9 flooded 11 flooded in the Marañon river were declared to be of national interest. p DIVERSION HYDROPOWER PLANT: Does not generate a significant accummulation of water 32.5 km² 36 km² (reservoire) upstream of its turbines. The turbines are moved by the natural flow of water in the of forest flooded, of forest flooded, basin. the equivalent to the equivalent to n IMPOUNDMENT HYDROPOWER PLANT: Uses a reservoire to store water and control the flow through the turbines. 4552 5042 soccer fields soccer fields WHAT IS A MEGADAM? hectares of agricultural hectares of agricultural land lost land lost A megadam is an impoundment hydropower plant with a dam structure between 15 to 100 224.8 74.37 meters tall, with a minimum capacity of 400 MW. It is installed in a river. Large hydropower plants with reservoirs are meeting increasing opposition due to the grave environmental impacts they generate, because they flood towns, forests and agricultural lands, and block 10.33 million 10.14 million the passage of sediments that fulfill key ecological processes. They also generate tons of sediment retained yearly tons of sediment retained yearly significant greenhouse gas emission. In Europe, almost 5000 dams have been removed, and in the United States, 1200. Source: Dam Removal (2018), International Rivers (2020), American Rivers (2020). VERACRUZ HYDROPOWER PLANT DATA SHEET CHADÍN 2 HYDROPOWER PLANT DATA SHEET COMPANY CAPACITY COMPANY CAPACITY In a hydropower plant, the force exerted by the VERACRUZ CHADÍN 2 TALLEST BUILDING IN PERU Compañía Energética Veracruz S. A. C. 653 MW AC Energía S. A. 600 MW HYDROPOWER HYDROPOWER water flow moves the propellers of a turbine BANCO DE LA NACIÓN TOWER Subsidiary of Enel Subsidiary of Odebrecht which turns a generator attached to it, PLANT PLANT Levels: 30 | Height: 135.5 m Height: 160 m Height: 163 m generating electricity. DAM HEIGHT RESERVOIRE CAPACITY DAM HEIGHT RESERVOIRE CAPACITY 160 m 85 m³/s 163 m 385 m³/s 150 m AREA OF IMPACT AREA OF IMPACT • Amazonas: Yamón and Lonya Grande districts • Amazonas: Ocumal, Pisuquia and Cocabamba districts RESERVOIRE (Utcubamba) and Camporredondo district (Luya) (Luya) and and Balsas district (Chachapoyas) • Cajamarca: Cujillo district (Cutervo) and Pión district • Cajamarca: Celendin, Chumuch and Cortegana district DAM 100 m (Chota) (Celendin) TOTAL INVESTMENT TOTAL INVESTMENT DOWNSTREAM 1443 million USD 2023 million USD TREES OUTLET 50 m PENSTOCK Source: Conservation Strategy Fund (2017) THE PERMITS 10 m RIVER TURBINE Before starting electrical projects, a company must have an electrical concession and an environmental certification, as well as other permits depending on the magnitude or location of the project. Based on our analysis, both projects lack key documents that would allow them to legally commence construction. CHADÍN 2 HYDROPOWER PLANT Certificate of Permits Water Authorization to Archaeological The owner of this project is Odebrecht. Following a Definitive Non-Existence of availability carry out water Evaluation corruption scandal, the company began selling assets. Environmental concession Archaeological study use works Project Certificate (Ministry of Remains Although there has not been progress on the project, (National Water (National Water (Ministry of (Senace) Energy and (Ministry of Odebrecht is attempting to keep it legally active in order to Hydropower Mining) Authority) Authority) Culture) sell it. plant Culture) VERACRUZ HYDROPOWER PLANT VERACRUZ No longer Active Expired Absent Absent Absent valid Enel, owner of the Veracruz project, is one of the most import- ant power generation companies in the private sector. Veracruz has ceased to be in its portfolio of projects in Peru, CHADÍN 2 No longer Active Expired Active Absent Absent but the project remains legally active. valid Administrative Registry of Environmental Certifications The environmental certifications of the Chadín 2 and Veracruz projects are no longer valid, however the Administrative Registry of Environmental Certifications controlled by the National Environmental Certification “We stopped investing in large plants, not Service for Sustainable Investments (Senace) does not specify whether the environmental certifications are valid just coal, but also large hydroelectric plants or not. According to the DS 016-2020-PCM, this year, new search criteria have been added but these do not that take years to be developed. And we include the categories “no longer valid” or “validity lost”. have begun to do so since 2014” (2017) We, the Peruvian Society of Environmental Law (SPDA) consider that Senace should include the categories “valid”, “non valid”, or “validity lost” in its Administrative Registry of Environmental Certifications, in order to provide the Francesco Starace, CEO of Enel public with transparent information about the state of different projects. Report: An analysis of the environmental legal status of the Veracruz and Chadín 2 hydropower plant projects in the Marañon river. SPDA (2020) TIMELINE: LEGAL STATUS OF THE CHADÍN 2 AND VERACRUZ MEGADAMS In 2011, Peru projected a level of growth that would have required an amplification of its electrical matrix. To cover this necessity, the Peruvian government declared hydropower plant projects in the Marañon river to be of national interest (DS 020-2011-EM). In 2014, definitive concession contracts were granted to the Chadín 2 and Veracruz hydropower plant projects, which are currently active. However, Peru currently has surplus of energy, which has led the government to cancel its official call for energy through large hydropower plants. The government's decision and the lack of market-based demand has left both hydropower projects commercially nonviable. The timeline below shows the processes both projects have undergone to acquire the permits they need for construction, and their current status. VERACRUZ HYDROPOWER PLANT CHADÍN 2 HYDROPOWER PLANT 01/14/2010 The National Institute of Culture grants an Archaeological Evaluation Project (PEA). ON A NATIONAL SCALE Alan Garcia’s government declares the development of 20 hydroelectric power plants on the Marañon river to be of national interest (DS 020-2011-EM). To 04/24/2010 this date, none of these projects have a definitive or Reports of social conflict temporal concession. The Marañon, Chadín 2 and during the informative Veracruz projects are not part of this priority list, but workshops in the local towns. 07/16/2010 are granted definitive concessions. GOVERNMENT ALAN GARCÍA’S The company requests to leave The PEA is left 2011 the PEA unresolved. unresolved as requested by the ON A REGIONAL SCALE company. The local population whose homes would be flooded 2012 with the Chadín 2 dam show strong resistance to the project. The public participation processes 01/12/2012 encounter serious difficulties and the “ronderos” National Water Authority (ANA) approves (rural community justice groups) who oppose the a water availability study. Note that this 10/12/2012 project are criminalized. does not authorize water use works. National Water Authority (ANA) approves a water availability study and an authorisation to carry out water use works. 04/01/2013 2013 Ministry of Energy and Mining approves the Environmental Impact Study ON A GLOBAL SCALE (EIA) of the project. 2014 Enel, the company behind the Veracruz project, supposedly decides to back away from large dams 02/20/2014 due to their impact. 11/05/2014 Ministry of Energy and Mining approves the Veracruz is granted a definitive concession Environmental Impact Study (EIA) of the project.