It’s crunch time for a joint venture hoping to build five large hydroelectric dams in Chile’s southern Aysén region.

The joint venture, HidroAysén, is preparing to respond to numerous government questions and concerns about the environmental impact study it filed last year for its US $3.2 billion project to erect the hydroelectric stations on the Baker and Pascua rivers.

As it does so, opponents of large dams in the scenic, largely pristine Patagonian region are ratcheting up pressure against the project.

That pressure intensified this month, when the University of Chile and U.S. and Chilean non-governmental groups released a study concluding HidroAysén’s output will be unnecessary from an energy-supply standpoint and costlier than available alternatives.

Meanwhile, U.S.-based International Rivers Network has stepped up a campaign to persuade the Home Depot chain to stop buying wood products from the subsidiary of a Chilean company that controls Colbún, a partner in the HidroAysén joint venture.

The impact study for HidroAysén was filed in August 2008, with company responses due three months later. A related public-consultation process conducted last fall generated more than 10,000 citizen comments and 3,000 questions from governmental agencies.

Information gaps cited

About a third of the 36 public agencies to evaluate the study said they could not recommend its approval, citing problems including a lack of information on the impacts glacier-fed flooding would have on the dams, inadequate analysis of seismic conditions and incompatibility with park- and forest-protection laws.

Given the numerous agency questions, the Aysén Regional Environmental Commission in late November granted HidroAysén nine extra months—until August 26, 2009—to prepare responses. Opponents of the dams are using the time to make their case to the public.

The 94-page energy study released this month, titled “Are Dams Necessary in Patagonia? An Analysis of Chile’s Energy Future,” argues Chile could improve its supply picture dramatically by expanding efficiency measures and tapping its renewable-power potential. It also questions forecasts of supply shortfalls.

The National Energy Commission (CNE) estimates installed capacity must increase to 22,736 megawatts between now and 2025 to meet government-projected demand growth of 5.5% to 6.5% a year. But the new study, conducted over eight months by three University of Chile researchers and an independent consultant hired by the U.S.-based Natural Resources Defense Council (NRDC), states energy projects already approved for construction would ensure 23,143 megawatts are available in 2025.

One of the authors, Roberto Román, a renewable-energy expert at the University of Chile, says the picture improves further when projects already underway or approved are considered alongside actual trends in energy demand. He points out that because of the economic recession, for example, energy demand in 2009 is expected to grow just 2.1%.

“For 2014, we will have much more supply than needed, and in 2025, the supply situation will be even better,” Román says. “Just by expanding the efficient use of energy through a campaign, and not necessarily an aggressive campaign, we could save nearly 20,000 gigawatt hours per year, which is more than the equivalent of the 18,400 gigawatt hours HidroAysén could produce.”

Aside from NRDC and the University of Chile, the organizations behind the energy study were the Patagonian Foundation, a U.S.-based group that seeks to preserve Patagonian culture and environment, and the Council to Defend Patagonia, a coalition of 24 Chilean and U.S. citizen and environmental groups.

Broad coverage sought

HidroAysén critics hope to make the dams an issue in this year’s Chilean presidential election campaign, but some worry the largely conservative media will ignore it. “The study can help a lot,” says Peter Hartmann of the Council to Defend Patagonia’s steering committee. “But if the media does not get this information out there, how will it enter the national debate?”

The International Rivers Network (IRN), for its part, has had the U.S. media in mind in its bid to halt Home Depot wood purchases from a subsidiary of Chile’s Matte Group. The Matte Group owns a controlling stake in Colbún, partner in the HidroAysén joint venture with Italian- and Spanish-owned Endesa. Matte Group’s CMPC subsidiary sells some $50 million in wood products annually to Home Depot.

In May, IRN hired a plane to fly a banner reading “Dam Home Depot” over the Home Depot shareholders meeting in Atlanta, Georgia. The group staged demonstrations at Home Depot stores in several U.S. cities, and launched a letter-writing drive that it says has generated thousands of pieces of mail. Says Gary Hughes of IRN’s Patagonia Campaign: “There are plenty of alternative timber providers for Home Depot, and Chile has abundant energy options, including some of the greatest solar, wind, and geothermal potential in the world.”