Serious risks expected to the Belo Monte hydroelectric dam project due to climate change impacts in the AmazonBrasília - 1st of April 2011 - Under the most drastic of future climate scenarios, the Belo Monte hydroelectric dam project, which will require more than R$ 20 billion in investment (approximately US$ 12 billion), might lose more than 80% of its annual revenues by 2050 as a result of diminishing river flow from the Xingu River.
These are the preliminary results of a study in development by WWF-Brazil and specialized consultants in hydrology and climate change under the HSBC Climate Partnership. The study analyses the climate vulnerability of hydroelectricity production in the northern region of the country, focusing on large projects such as the Belo Monte hydroelectric dam.
"As a result of climate change, the likely reductions in river flow in the Xingu will undermine Belo Monte's financial health", stated Carlos Rittl, coordinator of the Climate Change and Energy Program of WWF-Brazil. "Belo Monte could generate much less energy and much less revenue than expected, becoming a financial fiasco", he added. "The high social, environmental and financial costs should draw the Brazilian government into a wider reflection on whether or not it is actually feasible to go through with the project", he concluded.
The study, to be launched this year, considered 4 different climate scenarios established by the IPCC - A1, A2, B1 and B2 - each one describing a possible future for humanity and the resulting emissions curve. By applying different climate models - such as the HadCM3 from the Hadley Center (Great Britain) and the ECHam4 from the Max-Planck-Institute für Meteorologie (Germany) - to these 4 different scenarios, it is possible to identify a clear and significant reduction in river flow from the Xingu River by 2050.
Although there is a wide variability in the results obtained - a few results show an increase in revenues of 4% by 2050, while others show a strong reduction of almost 90% -, a trend is quite clear: the mean loss in revenue can vary between 4 and 10% of the annual revenue by 2050.
According to Carlos Alberto de Mattos Scaramuzza, Conservation Director of WWF-Brazil, climate variability is not being properly considered in the energy planning of the country and in profitability assessments of hydroelectric projects in the Brazilian Amazon. "We had two severe draughts in the Amazon in less than 10 years, in 2005 and again in 2010. We have to learn from these extreme climate events and adequately include the climate variable in the efforts to expand the electricity producing capacity of the country. Considering these results, it becomes even clearer how attractive energy efficiency and non-conventional renewable energies, such as wind, solar and biomass, really are. With the right investment, these alternatives can generate sufficient energy to satisfy the development needs of the country, while minimizing the climate risks of hydroelectric projects", concluded Scaramuzza.
"The government tends to consider hydroelectric projects one-by-one, which is inefficient when considering all economical, social and environmental aspects", stated Denise Hamú, CEO of WWF-Brazil. "The risks of the Belo Monte project have been socialized in order to attract investors. Preliminary data of the study indicate that the financial risks can be even bigger than originally predicted and this requires a wider analysis of the existing potential, advantages and risks associated with the increase in electricity production", concluded Hamú.
WWF-Brazil considers essential that hydroelectricy expansion be judged under a holistic view of the entire Amazon basin. An integrated analysis is needed, considering the social and environmental risks involved throughout the rivers - which are natural and continuous systems - and not just only in those areas situated in and around the project.
Notes on the IPCC Climate Scenarios
Scenario A1 describes a world of rapid economic growth and rapid introduction of new and more efficient technologies. Population reaches a maximum in the middle of the century and then starts declining. This scenario describes a convergent world as evidenced by rising social and cultural interaction, and the reduction in regional differences and per capita income.
Scenario A2 describes a very heterogeneous world where per capita income and technological development converge in a much slower and fragmented way. With stronger regional identities, birth rates diminish more slowly, which results in continuous population growth.
The B1 scenario describes a more integrated and environmentally sound world. Economic growth is as strong as in A1, but characterized by rapid changes towards an information and services based economy. The focus for economic, social and environmental stability is global
The B2 Scenario describes a more heterogeneous world, although much more sustainable. It is an intermediate scenario with continuous population growth, medium economic growth, and slower and more fragmented technological changes. The focus is on local solutions for economic, social and environmental stability.
The HSBC Climate Partnership
The HSBC Climate Partnership is a five-year program which aims to conduct the largest field experiment on the effects of climate change in the long run. Divided in four main strategic lines, the project seeks to: conserve freshwater supplies, reduce greenhouse gas emissions in large metropolises, research biodiversity in tropical forests and engage the bank's staff in transformational change.
WWF-Brazil is a Brazilian non-governmental organization dedicated to the conservation of nature aiming to harmonize human activity with biodiversity conservation and to promote the rational use of natural resources for the benefit of current and future generations. WWF-Brazil was created in 1996 in Brasilia and has several projects all over the country and is part of the International Network Environmental Organization WWF, which works in more than 100 countries and counts on the support of around 5 million people worldwide, including associates and volunteers.