Brazil is moving closer to its controversial goal of building a second gigantic hydroelectric dam—Belo Monte, a US$8 billion, 11,183-megawatt behemoth that would be erected on the Xingu River in the eastern Amazon state of Pará.

The effort to undertake the long-stalled project has been aided by a ministerial reshuffle that has placed proponents of the dam in key positions of power. Lawmakers, meanwhile, have proven receptive. Last month, both houses of Congress voted to authorize the project provided it survives a complex and likely time-consuming array of feasibility studies.

According to government plans, Belo Monte would be the second most potent hydropower station in Brazil behind Itaipú, a 12,600-megawatt dam on Brazil’s border with Paraguay and one of the world’s largest dams.

The project had been sidelined since May of 2001, when a federal judge in Pará ruled that Brazil’s constitution prohibits construction of dams in indigenous areas without the informed, prior consent of the affected tribal communities. Belo Monte’s current, run-of-the-river plan calls for diverting the Xingu away from a 43.5 square-mile (112.7-sq-km) reserve of the Paquiçamba, a 70-member indigenous group, and from non-demarcated land occupied by 468 Indians from other tribes.

Are studies enough?

To address this problem, Congress stipulated in the decree approved last month that “anthropological studies” be undertaken in the feasibility review, which also must cover economic, technical and environmental questions.

The sponsor of last month’s legislative decree, Congressman Fernando Ferro, says the anthropological studies would necessarily involve consultation with indigenous groups. But the assurance doesn’t satisfy the Pará state federal prosecutor’s office, a watchdog agency that in 2001 won a court injunction—supported by the Supreme Court—to halt the project.

“[The] legislative decree is unconstitutional,” says Ubiratan Cazetta, an attorney in the Pará state federal prosecutor’s office who handled the 2001 injunction request. “‘Anthropological studies’ are not synonymous with consulting indigenous communities. Prior consent can only be done via a law detailing how public hearings will be held.”

On July 21, Greenpeace and the Socio-Environmental Institute, two of Brazil’s leading green groups, called on the Brasília-based chief public prosecutor’s office to ask the Supreme Court to overturn the congressional decree.

Carlos Rittl, a Greenpeace staffer following the Belo Monte project, acknowledges that legal challenges ultimately might be overcome by the project’s new political momentum. He cites President Luiz Inácio Lula da Silva’s appointment in June of Dilma Rousseff as his new top political advisor and of Silas Rondeau as Brazil’s new Mines and Energy Minister.

Rousseff, the former Mines and Energy Minister, and Rondeau, formerly the head of Eletronorte, the state-run power company responsible for Amazon dam projects, both consider Belo Monte crucial in addressing a looming energy deficit. Says Rittl: “[I]t will be hard to stop the project. Rousseff’s and Rondeau’s influence can be seen in Congress authorizing the dam’s construction only one month after they assumed their new positions.”

Financing a question

Despite the approval of Belo Monte, technical and economic questions have arisen about the project—the bulk of which the government hopes will be financed by the private sector. (See “Belo Monte project banking on private investors,”—EcoAméricas, Feb. ’02).

Opposition to Belo Monte, on the drawing boards since 1990, forced the government to redesign the project in 1994. It scaled back the reservoir so 170 square miles (440 sq kms) of rainforest would be flooded rather than the original 472 square miles (1,225 sq kms).

But critics say the reservoir will be too small to allow Belo Monte to operate at its 11,183-megawatt capacity year round. Instead, they say, the run-of-the-river facility only will reach its full generating potential during the December-to-June rainy season. New studies show that during much of the dry season the dam would produce hardly any energy, says Glenn Switkes, Brazil representative for the International Rivers Network, a U.S.-based green group that helped fund the studies.

Sérgio Bajay, former director of energy policy for the Mines and Energy Ministry, says that Belo Monte’s yearly power generation is difficult to estimate. But Bajay, now an energy professor at Unicamp, a university in southeastern São Paulo state, adds, “It will be very low, and certainly low enough to discourage private investors from investing in the project.”

Says Bajay: “The main users of Belo Monte energy will be aluminum smelters [owned by Alcoa and BHP Billiton], and CVRD [a mining company]. Because the seasonality of rains poses a risk to the dam’s firm energy generation, these smelters will not likely enter as majority investors, but minority ones. That means the government will probably have to put up most of the money for Belo Monte.”