Honduran hamlet split over dam; Project would dry up river, opponents say
Copyright 2001 The Times-Picayune (New Orleans)
December 31, 2001
By James Varney; Latin America correspondent
LAS MANGAS, HONDURAS -- Progress has come knocking at this hamlet and others like it perched above the Rio Cangrejal, but it's not receiving a warm welcome.
Las Mangas and a handful of other hamlets are strung along a surprisingly sound unpaved road that tracks the river on the eastern edge of Pico Bonito National Park. The park's mountains rise in lush, tropical splendor along the Caribbean Sea. Waterfalls crash through the pristine forest, and rushing currents have sculpted the giant rocks along the Cangrejal's banks into hallucinatory guardrails. Even on an isthmus justly famous for its environmental beauty, this sliver of Central America verges on the sublime.
And now a piece of it verges on obliteration. A battle has begun in the region over a proposed hydroelectric dam. Opponents are local activists and scrappy entrepreneurs who champion small, homegrown businesses. They are pitted against super-rich developers who stand to make millions more if the mega-project goes through. As with many environmental disputes in Latin America, the battle array divides the average citizen from financial interests controlled by a group of powerful and politically connected men.
In those respects, the looming clash is a familiar one. What makes it different, opponents of the dam say, are the stakes. Here the fight isn't over saving a tiny snail darter, but jaguars and river otters. Here the prize is not some obscure body of water, but a dramatic and accessible river that local officials think could be an engine for economic development through tourism. And here the battlefield isn't just a backwater in a big country, but a crown jewel of a small one.
Dam 'would be a crime'
Pepe Herrero, a former Louisiana State University student and peripatetic Honduran businessman with a house on the Cangrejal, is leading the fight against the dam. The problem, Herrero argues, is not so much flooding above the dam, the most common complaint against hydroelectric projects, but the resulting lack of water below it.
The dam's design would create a relatively small 30-hectare pond, then divert the river's water through a pipeline 11 kilometers long before returning it to the river. As a result, Herrero said, the river would dry up for a stretch, driving a stake through both the fish population and a whitewater rafting industry based in nearby La Ceiba.
Perhaps even worse, according to this scenario, if the river perished, so, too, would the natural boundary protecting the Pico Bonito park, exposing the virgin forest on the eastern bank to the same illegal logging and slash-and-burn agriculture that already has denuded much of the valley upstream.
"Costa Rica's entire modern economy was built around ecotourism, but the Ticos would kill to have a river like this," Herrero said. "Destroying this would be a crime."
A global perspective
Naturally, the developers have a different opinion. The consortium consists of four companies, with the lead handled by Hydro-Honduras, an outfit incorporated just for the project, and Hydro-West, a U.S. company based near Seattle, which holds a one-third interest.
The $80 million dam project is relatively small. It would generate only 50 megawatts of power in a country that consumes about 650 megawatts daily. Developers say it would save Honduras about $10 million in annual electricity costs while providing 200 to 300 construction jobs in La Ceiba over a two- to three-year period. Further, it would reduce dependence on the power line that feeds La Ceiba electricity generated in San Pedro Sula, more than 100 miles away.
Opponents of the dam dispute some of those benefits. But even if the rosiest forecasts are borne out, they don't offset the environmental losses, they say.
Hydro-Honduras General Manager Alvaro Chavarria sees it from a different perspective. "Hydroelectric projects do have a high local impact while the benefits tend to be more global," he said. "If you look at this thing from the perspective of the whole country, then you see it is good. If you see it only locally, things might be different."
And anyway, he said, it's only one small stretch of the river that would suffer.
"This whole thing is over 4 kilometers on the river they want for rafting," Chavarria said. "Compare what rafting gives to the country to what the dam will provide for Honduras."
Local views
To be sure, the dam has local boosters. Chief among them is Baudilio Lobo, 50, a lifelong resident of the Cangrejal who has become an unofficial consortium spokesman in Las Mangas and nearby towns such as El Pital.
"We all think the same thing here, and that is that the dam is a good development," Lobo said recently while supervising a crew of young boys moving rocks off the road. "It will mean progress, it will mean jobs and money for the locals. And besides, the river is no longer that important to the people around here. They have all the water they need."
But dozens of others in the Cangrejal valley and La Ceiba said Lobo speaks strictly for himself. They say he never much loved the river to begin with, as evidenced by the fact he used to dynamite it for fish, an environmentally damaging practice that also cost him both arms.
Among those standing opposite Lobo is his sister, Gloria Lobo, 48, whose house, perched on the Cangrejal's western bank, just below the proposed site, is reachable only by a high-wire basket.
"I'm not against a dam or more electricity, I'm just against this one because it's going to dry up the river," she said. "Look, we get all our water for cooking and cleaning from this river, we get fish to eat from the river, and the tourists who come around here love the river and the forest. Without all this, you can say goodbye to our towns."
If her critique smacks of Herrero's, it's because he is a friend who has been pitching his case for months in schoolhouses and other places of public assembly along the Cangrejal. But almost all opponents, in letters and speeches, unfailingly note their overall support for additional power. They have proposed alternative dam locations but claim that Hydro-Honduras summarily dismisses every suggestion.
"We're not Earth-Firsters, we're not categorically against any project at all," said John Dupuis, an owner of riverfront property and the editor of Honduras Tips, a widely circulated tourist guide. "It's just this particular project that we think is a bad idea."
Formidable foe
Questions also surround some members of the development consortium. Hydro-Honduras' president is Freddy Nasser, a colorful and skillful businessman but with a well-documented taste for la transaccion oscura, Honduras' version of "the shady deal."
Just last month, a Nasser real estate purchase in Amapala, a town on the Pacific Coast, came under heavy scrutiny. An investigation by the national paper La Prensa triggered a federal probe that determined that Nasser had persuaded city officials to sell him a potentially valuable island just offshore for "the price of a dead rooster," as they say in Honduras -- in this case 100,000 lempiras, or less than $6,500 at the current exchange rate. Rumors of kickbacks were rife, and last month several elected local officials were arrested. Amapala Mayor Jaime Mauricio Talavera dodged an arrest warrant by going underground.
Even more powerful than Nasser, however, is his father-in-law, Miguel Facusse, who is regarded in La Ceiba, if not Seattle, as the real force behind the dam. A living legend in Honduras and the uncle of President Carlos Flores, Facusse generally is considered the country's richest man, one whose wealth is matched only by his charm.
Opponents see Hydro-Honduras' political connections behind the fast-track congressional approval of contracts that give the consortium the right to dam the Cangrejal and that oblige the government to buy the electricity for 20 years. Although no one has accused Flores of taking sides or pulling strings, few consider his administration, which ends next month, overly sensitive to environmental impact. "If you're wondering how much President Flores cares about the great outdoors, all you have to know is that his vacation home is in Metairie," Herrero said.
Meeting resistance
Against that backdrop, it is not surprising that the dam's opponents in La Ceiba think they have been treated rudely by Hydro-Honduras and the big boys in Tegucigalpa, the capital. They offer a timeline replete with examples of what they consider to be Hydro-Honduras' indifference to the environment and due process: flouting rules for environmental review of their plans, ignoring questions and challenges posed by quasi-public environmental groups and then, late last month, an abortive attempt to extort political support from La Ceiba Mayor Gonzalo Rivera.
On Nov. 20, five days before national elections and a decision on Rivera's bid for re-election, a handful of Hydro-Honduras officials, including Nasser, flew to La Ceiba for a meeting, requested the day before, with the mayor. At the meeting, according to several participants, they insulted some of La Ceiba's wealthiest residents, excoriated Herrero as a left-wing troublemaker and insisted Rivera sign documents showing he supported the project.
The tactics backfired. Local businessmen, already irked that Hydro-Honduras for months had ignored their questions about the project, crisply told off Nasser and his dam. Rivera, locked in a bitter re-election campaign against a challenger who also opposed the dam, calmed an irate Herrero and brought the meeting to a close. No deal.
Rivera, since re-elected, has hardened his position against the project and has appointed Herrero his special adviser. In that capacity, Herrero traveled to Seattle on Dec. 14 to drum up support among U.S. green groups and to meet with Hydro-West executives.
"I think what happened here was you had some very rich and very powerful people who thought they could just steamroll the people in La Ceiba," said Carlos Rivas, a watershed management expert who used to advise the World Bank and now is a private consultant hired by opponents to review the Cangrejal project.
"And unfortunately that's pretty standard in Honduras," he said. "You have to remember that our environmental laws here are strong only on the books. They are malleable, and what happens is that, because there are no real communists in Honduras, the companies brand any environmentalist who opposes them as a communist."
Generating controversy
The history of hydroelectric projects is replete with unwelcome repercussions. It remains a clean, accessible form of energy, but damming rivers and flooding valleys to generate it has proved disastrous to the environment and the local population in projects from Brazil to China. As a result, the World Bank, one of the multilateral lending institutions that the Cangrejal consortium plans to approach for financing, has grown less enamored of hydroelectric dams after years of championing them.
So far the World Bank is keeping an open mind about plans for the Cangrejal.
"We are not opposed to a hydroelectric project there per se, because if it's done well it's a clean source of energy," said Joe Owen, the bank's resident representative in Tegucigalpa. "But we hear there could be problems with the Pico Bonito forest, which is a gorgeous place, and we don't want to see anything happen to it."
Some local papers have reported that if the dam project rolls forward, the bank would scrub a recent $5.5 million loan it approved for tourism-related micro-ventures between Trujillo and Tela, towns that flank La Ceiba and roughly define the boundaries of Honduras' vast agricultural basin. Owen dismissed such reports, though he said the bank hopes to gain leverage on the dam project through its involvement in the area.
"There are rumors going around they are short-circuiting the process and dodging the environmental laws, but nothing I've seen so far pushes it beyond rumor," Owen said. "I remain cautiously optimistic that the right thing will happen."
Not alone
Despite problems in other countries, the hydroelectric movement remains strong in Honduras. "There is a sense that they have a wealth of water here and they should be taking advantage of that," said Tim Mahoney, the local director of the U.S. Agency for International Development.
But however vigorous the hydro lobby, opposition to it is not confined to the defenders of the Cangrejal. In the western region of Gualaco, a proposed dam has stirred indigenous people to serious protests, one of which led to the killing of a village leader and an ensuing five-day protest in Tegucigalpa. When authorities cracked down on the group in July, Amnesty International filed a formal complaint that the charges against them were politically motivated.
The Gualaco dam would flood out about 200 families who live in or around the Sierra de Agalta National Park. The Cangrejal proposal is shaped by a desire to avoid visiting a similar fate on an even larger population, according to Paul Berkshire, a Hydro-West executive in Port Lawrence, Wash. A hydroelectric generator of one form or another has been considered on the Cangrejal for almost 20 years, Berkshire said, disputing the contention that Hydro-Honduras and its partners have made a hasty and ill-considered decision on where to site their dam.
"About 3 kilometers upstream from where we are now, the Rio Cangrejal, in my opinion, is the best hydroelectric spot in the world," he said. "But that spot would flood out thousands of people. On any hydroelectrical project you're performing balancing acts like this, and we feel the current spot is the best."
Berkshire's colleague Chavarria, however, offered a contradictory assessment of the site. Although upstream construction costs would be $5 million less, that location would generate less power, he said.
The consortium's position was further undermined early this month when the U.S. Army Corps of Engineers delivered an assessment of the dam's current blueprint. The corps, on USAID stationery, said sediment build-up could slash the dam's electrical output by half in just 10 years and that the environmental studies the consortium has submitted are based on quickly accumulated data that fail to account for the long-term impact.
Mahoney noted it was Riveras who requested the corps report, and USAID complied because part of its mandate is to empower local communities, a philosophy that led last week to another request for the corps to evaluate a huge gas-powered electricity generator in the works near Puerto Cortez. The report should not be construed as the U.S. government's official position, he said.
"We're not taking sides here. We've been working on the broader issues of water management, and the mayor expressed a lot of concerns that sounded legitimate," Mahoney said. "We're just trying to provide local officials with as much information as possible so they can make the best decisions."
Nevertheless, the consortium is seething over what it sees as meddling by outside authorities.
"USAID and the corps are speaking completely out of school there, and we're working to get to the bottom of that," Berkshire said.
Still, Berkshire offered no rebuttal to the corps' conclusions, beyond saying the corps has no understanding of the economic considerations behind such projects. Chavarria said no one from the corps ever contacted Hydro-Honduras or Hydro-West to discuss the project, and thus based the study on incomplete information. Several sources said last week that Hydro-West was writing a detailed critique of the corps' assessment, but it remained unclear when or if that would be completed.
'Easily fooled'
Whatever the merits of the dam, neither side disputes it will have a major impact on the river just north of La Ceiba. Although the consortium claims that other streams and runoff will replace much of the lost water, a recent visit at the end of the rainy season showed that most of them were mere trickles. Some did not even reach the river's channel.
On the river itself, rapids ranging up to Category IV still roar, although in other places it already is so shallow that a kayaker gets stuck on the bottom and has to get out and push. Rivas estimates the river is flowing at an average rate of 5,000 gallons per second, and that the 100 gallons per second the dam will feed the stretch immediately below it is not enough to keep the river alive.
"The fact is these companies don't know the local situation, they didn't calculate the capacity of the riverbed properly," Rivas said, noting that the corps' report supports his contention that during the dry season, the river may not flow fast enough to keep the dam functional. That prospect, more than any of the consortium's claims of an economic bonanza for the area, is what agitates the people who dwell along Las Mangas.
"Of course I want more power, but it's not like this is the only way to get it," said David Gonzalez, the head of Las Mangas' loose-knit neighborhood association. "The people around here aren't educated, and they are getting easily fooled. The truth is this is a bad idea because it will mean the end of the Rio Cangrejal as we know it."