The study, in addition to analyzing in detail the situation of the Hydroelectric Plant, provides recommendations and suggestions to face the challenges involved in such an energy project.
In the constant search to generate balanced debate on the presence of China and its impacts in Latin America, the ICLAC Millennium Nucleus has launched a new Policy Paper entitled “Rucalhue Hydroelectric Power Plant, BioBío Region”. This document adds to the previous analysis of Chinese companies in Chile, delving into an emblematic case that has captured the attention of public opinion.
The study focuses on the Rucalhue Hydroelectric Power Plant, located in the BioBío Region, initially operated by the Brazilian company Atiaia Energía Spa and acquired in 2018 by Rucalhue Energía Spa, owned by the China International Water & Electric (CWE), a subsidiary of China Three Gorges Corporation, and the conflicts that have arisen from the implementation of this megaproject.
This case is of special relevance for several reasons. Firstly, it represents the first project executed by CWE in Chile, opening possibilities for its expansion in the region. Second, it has been explored in a report by the Collective on Chinese Financing and Investments, Human Rights and Environment (CICDHA, 2022), as an initiative that has generated negative impacts on the environment, the rights of indigenous people, and the civil and the local political situation.
The detailed analysis of the case highlights the sociocultural impact generated by the historical conflict in the locale of the hydroelectric plant. Despite having legal support through an Environmental Qualification Resolution (RCA) granted in 2016, the Chinese company has faced significant obstacles, including legal actions and complaints that have complicated the execution of the project.
The lack of adequate environmental governance in Chilean communes is revealed as the third important consideration. The Chilean electricity law grants property rights over water to the owners of hydroelectric plants, affecting the sustainability of this resource.
Despite the improvements made by Rucalhue Energía Spa, which include the reduction of environmental damage and a net gain in biodiversity, the historical conflict around the Biobío River basin and the defense of the basin suggest that the actions undertaken could increase the vulnerability of the ecosystem and the emergence of new uncertainties in the territory.
ICLAC's new Policy Paper on the Rucalhue Hydroelectric Power Plant invites us to reflect on the challenges that Latin America faces in the context of foreign investments, underlining the importance of a balanced and objective discussion to address the social, cultural, and environmental impacts of such projects.
The paper also considers recommendations and suggestions to address these challenges, to work on the country's environmental governance through a hybrid approach, increasing the active participation of non-governmental organizations and civil society, creating environmental education programs for local communities and indigenous people, and the inclusion in the national energy policy of new strategic measures based on the latest studies of the World Commission on Dams.
The study, written by María Elvira Ríos, ICLAC associate researcher; Janny Figueroa Ayala from the University of Concepción; and Andrea Freites, ICLAC doctoral student, is free, open, and can be downloaded here.