Conflict Resolution of the Boruca Hydro-Energy Project: Renewable Energy Production in Costa Rica

Conflict Resolution of the Boruca Hydro-Energy Project

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Conflict Resolution of the Boruca Hydro-Energy Project Renewable Energy Production in Costa Rica

Jürgen Carls and Warren Haffar

2010 The Continuum International Publishing Group Inc 80 Maiden Lane, New York, NY 10038 The Continuum International Publishing Group Ltd The Tower Building, 11 York Road, London SE1 7NX www.continuumbooks.com Copyright © 2010 by Jürgen Carls and Warren Haffar All rights reserved. No part of this book may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the written permission of the publishers. Library of Congress Cataloging-in-Publication Data Carls, J. (Jürgen) Conflict resolution of the Boruca hydro-energy project: renewable energy production in Costa Rica/by Jürgen Carls, Warren Haffar. p. cm. Includes bibliographical references. ISBN-13: 978-1-4411-1755-7 (hardcover: alk. paper) ISBN-10: 1-4411-1755-5 (hardcover: alk. paper) 1. Conflict management–Latin America–Case studies. 2. Sustainable development–Latin America–Case studies. 3. Power resources–Latin America–Case studies. I. Haffar, Warren R. II. Title. HD42.C368 2010 333.91’4097286–dc22 2009015842 ISBN: HB: 978-1-4411-1755-7

Typeset by Newgen Imaging Systems Pvt Ltd, Chennai, India Printed in the United States of America

Contents

Preface List of Acronyms and Abbreviations

xi xiii

CHAPTER 1 INTRODUCTION

1

The Boruca Project as Case Study Stakeholders Analysis of the Systems, Institutions and Actors of the Region Assessment of the Attitudes and Actions of Primary Actors General Observations Conclusion Traditional Approaches to Development: Theory and Practice Rethinking Project Design using Mediation and Conflict Resolution

1 3 3 5 6 8 8 12

CHAPTER 2 ENERGY PRODUCTION AND NEEDS IN DEVELOPING COUNTRIES

15

Current Situation in Latin America Plan Puebla Panamá and Future Economic Integration at the Regional Scale Conclusion Analysis of the Energy Sector in Costa Rica Policy Setting Legal Landscape The 2005 Generation Plan

v

15 19 21 22 25 27 29

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CHAPTER 3 ANALYSIS: HYDRO-PROJECT BORUCA, COSTA RICA History of the Project Legal Framework and Policies Electricity Policy Interinstitutional Cooperation Related to Hydro-Project Boruca Communication, Trust, and Coordination within the Electricity Sector Planning Tools Funding Mechanisms Human Rights International Law and Human Rights The Right to Development Rights Related to Resettlement and Land Property Rights The Right to Self-Determination Economic, Social, and Cultural Rights Environmental Rights for Peoples National Laws and Human Rights Violations Conclusion Stakeholders Boruca Hydroelectric Dam Project Stakeholder Participation Boruca Indigenous Community Térraba Indigenous Community Indigenous Reserve “Rey Curré” Environmentalists United States of America Canada Involvement of Institutions The National Commission for Indigenous Affairs (CONAI) Inter-Development Bank/World Bank/Financial Institutions Plan Puebla Panamá SIEPAC Public Understanding and Participation Conclusions Sociocultural and Economic Aspects Ecological and Environmental Impacts Biophysical Characteristics of the Térraba Watershed Downstream Ecological Impacts

33 33 37 43 44 44 46 46 47 48 49 51 53 55 56 58 59 60 61 65 65 66 69 71 72 73 73 73 74 75 75 76 76 77 89 89 94

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Impacts of Flooding the Reservoir Impacts on Watershed Management Construction and Development Impacts Mitigation Large-Scale Hydroelectric Power Plants Violence and Conflict Resolution Resistance from Local Communities Resistance from International and Domestic Law Conflict Resolution Conclusions about the Boruca Dam Project El Diquís Implications for the Road Infrastructure Implications for the Térraba–Sierpe Wetland Implication for the Communities Implications with Regard to the Use of the Río General Implications for Productive Activities Generation of Employment Investment Attractiveness due to an Improved Infrastructure Touristic Development and Other Economical Activities Implications for the Management of the Watershed Implications for the National Electricity System Control of the Flooding in the Lower Parts of the Watershed Implications for the Archeological Heritage Perspectives

95 96 97 97 98 99 100 101 103 104 113 115 116 117 117 117 118 118 118 118 119 119 120 120

CHAPTER 4 RETHINKING PROJECT DESIGN

127

Renewable Resources as a Key to Sustainable Development Demand Management and Efficiency Wind Power Biomass Geothermal Solar Hydropower Economic Sustainability Renewable Energy is Cost Competitive Green Power: A Business Opportunity for Costa Rica Full Cost Accounting Economic Benefits of Distributed Generation Carbon Financing

127 127 130 131 132 133 134 135 138 139 140 142 142

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Social Sustainability The Need for Greater Adherence to Good Practices Decision-making Institution Building Overcoming Barriers to the Implementation of the Sustainable Power Projects in Costa Rica Addressing the Policy and Legal Limitations Legislative Limitations to Renewable Energy Projects Improving National Policy for Indigenous Rights National Level Strategic Commitment to Alternative Energy Create Communication, Trust, and Coordination within the Sector Institutional Coordination Participation of Stakeholders Identifying Dividers and the Connectors Government of Costa Rica Costa Rica’s Electricity Institute (ICE) Environmentalists’ View of the Dam Projects Indigenous Peoples of Costa Rica Generational Conflict Land Conflict United States of America Canada The Institutions and Systems Involved The National Commission for Indigenous Affairs (CONAI) Inter-American Court of Human Rights Institute for Agrarian Development (IDA) Associations of Indigenous Development (ADI) Inter-American Development Bank/The World Bank, and Others Public Understanding and Participation Consultation/Mediation and Conflict Resolution Monitoring and Evaluation Dividers and Tension Builders Connectors and Local Capacities for Peace (LCP)

144 144 146 146 147 148 148 149 151 153 153 155 156 156 157 158 159 159 161 162 162 162 162 163 164 164 165 165 166 168 169 172

Contents

CHAPTER 5 REGIONAL DEVELOPMENT IMPLICATIONS IN THE SOUTH OF COSTA RICA Development Aspects for the Regional Indigenous Reserves in the South of Costa Rica Social Organization Action Plan for Linking Indigenous Groups to State Influence Local Services Training and Job Creation Potential Projects for the Indigenous Reserves Action Plan Estimated Principal Training Needs of the Indigenous Groups Regional Development of the Indigenous Reserves Quality of Life Improvement for the Indigenous Peoples (PNDPI 2002) An Aid Program for the Boruca Region CHAPTER 6 CONCLUSIONS ON MAIN THEMES AND ISSUES

ix

183 183 183 185 186 186 187 188 189 189 191 193

196

Energy Needs and Production Are Increasing in the Region Alternative Energy Options Are Feasible in Costa Rica Regional Indigenous Development Opportunities in the South of Costa Rica Exist Conflict Resolution of the Boruca Hydroelectricity Dam Is Possible

196 197

Bibliography

203

199 200

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Preface

In 2002, The Ombudsman Center for Environment and Development (OmCED) was asked by the Government of Costa Rica to mediate between the national and local interests of the Government of Costa Rica, the interests of the main stakeholder group, the indigenous peoples, and the interests of potential financing institutions such as the World Bank and others in regards to the construction of the Boruca Hydroelectric Dam, located in Southern Costa Rica. On behalf of OmCED, a working group was established, comprised of an independent international finance expert, a representative of the Government of Costa Rica, and a UN-mandated University for Peace (UPeace) representative responsible for development issues and international cooperation. The main objective of this working group was to promote the dialogue between the national institutions involved and the Indigenous Reserves in the Buenos Aires region potentially affected by the Boruca Dam. In 2003, the International Peace and Conflict Resolution Program at Arcadia University (IPCR) and the UPeace embarked on a major study examining the conflict surrounding the proposed construction of the Boruca Hydroelectric Dam, located in southern Costa Rica. This projectbased learning experience was developed to bring together theory and practice, illuminating for students the inexorable link between peace and conflict resolution and sustainable development. Through partnerships with the Kan Tan Ecological Project and the indigenous communities in the region, and field visits to the Inter-American Court of Human Rights and local civil society organizations, faculty, and students utilized the mediation framework to identify the underlying needs and interests of the stakeholders of the primary conflict. The mediation framework was in turn

xi

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PREFACE

tested as a suitable model for the resolution on environmental conflicts for Latin America. This book represents the outcomes of the OmCED working group and the field research results of the International Peace and Conflict Resolution Master’s program at Arcadia University. A project of this scope required the determination of several individuals: Sandra Jones, Safeer Bhatti, Daniel Moscovici, Rolain Borel, Manfred Peters, Giselle Borrase, John Chisman, Alexander Bonilla Duran, the Indigenous Peoples in the project region, and the representatives of the Government of Costa Rica. The authors want to express their sincere thanks to Jessica Morey and Lauren Jones for their valuable contributions developing the book.

List of Acronyms and Abbreviations

ADI ARESEP AWEA CAFTA CCSS CDM CEDIN CEJIL CEPAL

CERs CINDE CONADRO CONAI CNP+L DNHP DSE EEC

Asociación de Desarrollo Integral (Association of Integral Development) Autoridad Reguladora de los Servicios Públicos (Regulatory Authority of Public Services) American Wind Energy Association Central American Free Trade Agreement Caja Costarricense de Seguro Social (Costa Rican Social Insurance and Savings) Clean Development Mechanism Centro de Desarrollo Indígena (Centre for Indigenous Development) Center for Justice and International Law Comision Economica Para America Latina y el Caribe (Economic Commission for Latin America and the Carribean) Certified Emission Reductions Coalición Costarricense de Iniciativas de Desarrollo (Costa Rican Trade and Development Board) La Comisión Anti-drogas (National Drug Council) Comisión Nacional de Asuntos Indígenas (National Commission on Indigenous Issues) Centro Nacional de la Producción Más Limpia (the National Center for Cleaner Production) Do No Harm Project Dirección Sectorial de Energía (Sectorial Direction of Energy) European Economic Community

xiii

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ERU EU ETS ETSAP EWEA FECON FMAM FONAFIFO FTAA GEF GEX IACHR IADB ICC ICE ICT IDA ICOLD IIASA ILO INA INBio INEC INVU JUDESUR LCP MAG MEP

LIST OF ACRONYMS AND ABBREVIATIONS

Emission Reduction Units The European Union Emissions Trading Scheme The Energy Technology Systems Analysis Programme The European Wind Energy Association Federación Costarricense de Grupos Ambientales (Federation for the Conservation of the Environment) Fondo para el Medio Ambiente Mundial (World Environment Fund) Fondo Nacional de Financiamiento Forestal (National Forestry Financing Fund) Free Trade Area of the Americas The Global Environment Facility Global Exchange Inter-American Court of Human Rights Inter-American Development Bank Indigenous Circumpolar Conference Instituto Costarricense de Electricidad (Costa Rican Institute of Electricity) Instituto Costarricense de Turismo (Costa Rican Institute of Tourism) Instituto de Desarrollo Agrario (Institute of Agrarian Development) International Commission of Large Dams International Institute for Applied Systems Analysis International Labour Organization Instituto Nacional de Aprendizaje (National Institute of Learning) Instituto Nacional de Biodiversidad (National Institute of Biodiversity) El Instituto Nacional de Estadistica y Censos (National Census Bureau) Instituto Nacional para Vivienda y Urbanización (National Institute for Housing and Urban Development) Junta de Desarrollo Regional de la Zona SUR (Joint Regional Development of the Southern Zone ) Local Capacities for Peace Ministerio de Agricultura y Ganadería (Ministry of Agriculture and Cattle Ranching) Ministerio de Educación Pública (Ministry of Public Education)

List of Acronyms and Abbreviations

MER MIDEPLAN MINAE MOPT MPPE NAFTA OAS OCIC OECD OmCED PDR PNDPI

PPP PH Boruca RUTA SETENA SIEPAC UCR UICN UNDP WB WCD

xv

Mercado Electrico Regional (Regional Electrical Market) Ministerio de Desarrollo y Planificación (Ministry of Development and Planning) Ministerio de Ambiente y Energía (Ministry of the Environment and Energy) Ministerio de Obras Públicas y Transporte (Ministry of Public Work and Transport) Ministerio de Planificación y Política Económica (Ministry of Planning and Economic Policy) North American Free Trade Agreement Organization of American States Oficina Costarricense de Implementación Conjunta (Costa Rican Office on Joint Implementation) Organization of Economic Cooperation and Development Ombudsman Center for Environment and Development Programa Estatal de Desarrollo Rural (State Program of Rural Development) Plan Nacional de Desarrollo de los Pueblos Indígenas (National Plan for the Development of Indigenous Reserves) Plan Pueblo Panamá Proyecto Hidroeléctrico Boruca (Hydro-electric Project Boruca) Regional Unit for Technical Assistance Secretaría Técnica Nacional Ambiental (National Environmental and Technical Secretariat) Sistema de Interconexion Electrica para America Central (Central American Electrical Interconnection System) Universidad de Costa Rica (University of Costa Rica) Union Mundial para la Naturaleza (International Union for Conservation of Nature and Natural Resources) United Nations Programme for Development World Bank World Commission on Dams

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1 Introduction The Boruca Project as Case Study Since the mid-1990s, growth in electricity consumption in Latin America has averaged about 5 percent per year, one of the highest and most sustained growth rates in the world; one that is expected to continue at least until 2015. To meet this rising demand, governments and, increasingly, the private sector and multinational financing institutions are developing new power projects throughout the region. In Central America, electricity from new and existing plants is being transmitted from countries that have excess capacity to countries in need of electricity. This situation has made the region one of the world’s hotbeds for the development of hydroelectric projects. This has occurred alongside growth in ecotourism and the region’s identity as being a leader in sustainable development. Currently, there are as many as 120 hydroelectric projects under construction in Latin America. Collectively, these plants are estimated to produce 22,000 MW of new electrical capacity during the coming years; from 2003 onwards. Many national and international researchers and activists have argued that the costs—social, financial, and environmental—of large dams outweigh the benefits. The World Commission on Dams has concluded that, “on balance, the ecosystem impacts of large dams are more negative than positive and they led, in many cases, to significant and irreversible loss of species and ecosystems. In Costa Rica they are particularly controversial, especially the Boruca Project on both environmental and social justice concerns.”1

1

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CONFLICT RESOLUTION OF BORUCA ENERGY PROJECT

The Boruca Project will be analyzed as a case study wherein a mediation approach has been put into place by the Instituto Costarricense de Electricidad (ICE) as a means to secure increased electrical capacity in Costa Rica. Specifically, this analysis assesses the value of this approach, how it has been put into practice, and its utility in securing agreement for energy policy in Costa Rica. The “mediation framework” will be used as a new paradigm for identifying differing positions and underlying interests of all stakeholders involved, as well as a method for achieving or moving closer to sustainable development. An additional component of this analysis explores what lessons from this approach are transferable and whether they serve as a useful model for other countries in the region. Renewable energy resources in Costa Rica as a key to sustainable development will be discussed in detail. Finally regional development opportunities in the south of Costa Rica will be addressed. In 2002, it was decided to jointly create the Ombudsman Center for Environment and Development (OmCED) with the International Union for Conservation of Nature and Natural Resources (UICN). OmCED was asked by ICE in 2002 to mediate and negotiate between the interests of the Government of Costa Rica, the interests of the indigenous peoples involved in the Boruca Project, the local government in the south of Costa Rica, and the interests of potential financing institutions such as the World Bank and others.2 In 2004, a working group was established, comprising of an independent financial expert, one representative of the Government of Costa Rica, and a person responsible for development issues and conflict management. The main objective of this working group was to promote the dialogue between the national institutions such as the National Electricity Company of Costa Rica (Instituto Costarricense de Electricidad [ICE]), the Ministry of Environment and Energy (MINAE), and the indigenous reserves in the Buenos Aires region potentially affected by the “Boruca Dam.” Seven workshops were carried out with representatives from the indigenous reserves and representatives from national institutions, such as ICE and other institutions involved in the process. The main issues were related to the lack of information about the dam, the infrastructure, the potential relocation of indigenous communities, the organization of these communities to face the situation, the lack of jobs in the region, and potential degradation of natural resources and other implications caused by the dam. Additionally, with the idea to get more insights about the problems of the indigenous reserves and as measures of confidence building, several

Introduction

3

studies and construction improvements were carried out related to the specific situation of the reserves affected by the dam, such as z z z z z

the reconstruction of a bridge; a study on organizational needs of the indigenous reserves; a feasibility study on the production of toasted cassava ships; an analysis about medicinal plants in the region; and an overall analysis about the documents and studies related to the Boruca Dam.

Stakeholders Costa Rica is a country in midstream in the process of development. Like other countries in the past, however, the government and people of Costa Rica are facing great challenges. The following is an assessment of the tensions within the Central American state, focusing on the Boruca Dam Project.

Analysis of the Systems, Institutions, and Actors of the Region There are two primary actors within Costa Rica—(1) the Costa Rican, or non indigenous peoples, and (2) the indigenous peoples. Although the conflict about the Boruca Dam was originally presented as a tension between the government of Costa Rica and the indigenous peoples, this depiction is oversimplified. After some research into the Boruca Dam Project, it becomes apparent that the Government of Costa Rica is acting on behalf of the energy dependence of the nonindigenous peoples and the wider community of Central America. Thus, for the purposes of this assessment, the conflict will be viewed as having two primary actors, the indigenous and the nonindigenous peoples, with the Government of Costa Rica acting on behalf of the latter. The systems involved in the process are capitalism, expansionism (similar to the Manifest Destiny of the United States, except south), and globalization. As far as Costa Rica is concerned, each of these systems, more often than not, is a divider rather than a connector. The reason is rather straightforward; when one group of peoples has a desire to expand beyond their natural borders (nonindigenous peoples), a weaker community must pay the brunt of the costs (indigenous peoples); this has been the case in examples throughout history.

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CONFLICT RESOLUTION OF BORUCA ENERGY PROJECT

Capitalism is an engendering factor in expansionism and thus a great divider. Further, since capitalism widens the gap in resource allocation, this system of economics leaves most marginalized communities weak and vulnerable to exploitation. However, capitalism is also a connector for both actors. For instance, there should be a larger amount of imported goods offered to the peoples of Costa Rica, which, given the relative deprivation, will attract more individuals to consumerism. Thus, where on the one hand, capitalism will deter the marginalized from growing, it will at the same time bring the two communities closer to assimilation into the new “pop” culture.3 Globalization is a by-product of capitalism and expansionism and can both be a connector and divider of the primary actors. For example, both actors can unite in a general protest of the War on Iraq or global poverty. However, globalization is a larger divider; for instance, the indigenous peoples of Costa Rica can view indigenous communities of other regions and become engrossed in their cause to a greater extent, especially if that community is “well off.”4 The institutions involved as indirect actors include, but are not limited to, ICE; the Inter American Court of Human Rights; and various indigenous councils around the world, for example Indigenous Circumpolar Conference (ICC); as well as foreign governments involved in both the affairs of indigenous communities and the market system of the Americas (states involved in Plan Pueblo Panamá) (PPP).5 ICE is rather ignorant of the interests of the indigenous peoples of Costa Rica (at least as far as nondevelopment is concerned). Direct sources within Costa Rica have indicated that ICE appears to be somewhat of a national hero. The energy organization is often depicted as such because it had made available telecommunications and infrastructure lines to the majority of the citizens of Costa Rica, both indigenous and white, in a time of predevelopment. Although ICE is considered a dividing factor between the two primary actors, the organization is also a connector because it provides the local indigenous communities with the funding for their own radio stations, as well as their power needs. While traveling in the most rural communities of Costa Rica, it appeared that there was no shortage of power or telecommunications. It should be noted, however, that the infrastructure in the rural communities is of a lesser quality than in the urban centers (although this should be expected and is considered normal). Also, the funding for the radio stations could be counterproductive to the wider interests of the affected community, for example, if the funding is provided by an antagonist, the station cannot use its airwaves to broadcast politically motivated messages.

Introduction

5

In general, one reason for implementation of the Boruca Dam Project is to bolster energy reserves and enable exporting to other regions. The revenues from exporting energy would be used to continue development and pay the large sums of debt which has accrued from the beginning of the westernization of Costa Rica. These payments would be made via the World Bank and International Monetary Fund. Thus, the PPP is a divider for the status quo individual indigenous peoples within the Mayan community. Essentially if the PPP is passed, the indigenous community would lose much of its land and way of life. Indigenous groups appear to fail at protecting the indigenous peoples of Costa Rica. This failure is generally because of a lack of overall resources. Indigenous communities are almost inherently a marginalized group of peoples within their own state, thus the allocation of resources to protect and provide are most notably based on donations and are hard to acquire. Also, since these groups are marginalized, more often than not, each ethnicity is fighting for its own causes and in some cases is not able to sympathize with an outside community. There are however, some exchange programs in place with the Mayan community and North America, including both the United States and Canada. This is at least a cultural exchange, which may engender activism.

Assessment of the Attitudes and Actions of Primary Actors The attitudes and actions of the indigenous communities are based on the interests, needs, and position of the wider indigenous peoples’ nation. First, the interests, needs, and position of the community are hard to define; this problem is based on the divide among the indigenous communities. While traveling through the region, it became apparent that each group had its own view of the Boruca Dam Project and development in general. Not only did each group differ, but inside different cultures was an even greater divide. This divide is not based on any preconceived variable such as age, sex, or occupation. In fact, as far as experience provided, there was no single pattern to understanding whether development was considered desirable by the communities even at the cost of their own heritages. The needs, interests, and positions of the community should be decided upon through communication and agreement. Currently the action of the indigenous community is to protest, albeit minimally, against the construction of the Boruca Dam and other infringements upon indigenous territories. The community appears to conjure up the power of International Labour Organization (ILO) 169 in the hopes of the wording protecting their “interest.” Yet, without clear needs, their position and

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CONFLICT RESOLUTION OF BORUCA ENERGY PROJECT

actions continue to waver, weaken, and lose credibility in the eyes of the nonindigenous people, which is detrimental to the cause of the indigenous peoples. The nonindigenous community has clear interests, needs, and positions, as well as actions and attitudes. The needs of the community, as argued by the Government of Costa Rica and ICE are to expand its territory and gain valuable resources that will pay debt and precipitate development. The interests of the community appear to be consumerism, globalization, and westernization of the state. It follows then, that the position of the nonindigenous people is to build the dam, enjoy the tourism benefits of a second great lake (Lake Arenal was the first lake artificially created in a damming process), and to assimilate the indigenous culture into the wider community. Some believe that the attitudes of the nonindigenous people are based on marginalization of the indigenous community.

General Observations The following section is a list form of general observations and a brief summary of their importance with regard to the conflict: 1. The government of Costa Rica is exploiting a weakened community for development but cannot capitalize fully because ICE is unable to formulate a coherent strategy for development. According to some sources, the Boruca Dam Project has been in the planning stage for over 40 years. 2. The indigenous community of Costa Rica is untrusting of the government. This is due primarily to the government’s reneging of protection laws created to provide land for the indigenous peoples. 3. The indigenous community is in disarray and unable to fully articulate the interests, needs, and positions of their respective citizens because of historical, social, and economic marginalization and discrimination. As stated above, the leadership of the indigenous peoples must organize each region and provide a cogent stance on further development. If this does not occur, the government will eventually capitalize on their proposed plans and continue to exploit the marginalized community. A diagram of the actors, their interests and positions, and the advantages and disadvantages of building the dam is shown in Table 1.1.

Table 1.1 Actors

Interests

Positions

Advantages

Disadvantages

Preserve the indigenous culture Preserve the land for ceremonial burial grounds

Do not build the dam Ensure that interests are represented if the dam is built

Modern conveniences Employment opportunities Financial reimbursement for land

Potential loss of cultural attributes Assimilation into more urban setting Loss of land rights as symbolic of cultural rights

ICE (Institute for Electricity)

Provide energy to CR citizens Export power to make money Draw in investment and tourism

Build the dam Increase energy production instead of reduce energy consumption

Provide source of income for Costa Rica from other Central American countries

Not a long-term solution for energy needs Need to relocate part of the Inter-American Highway

OmCED (International Ombudsman Centre for the Environment and Development)

Mediate the issue

Build the dam but compensate the affected parties

Objective

Objective

Environmentalists

Preserve the wetlands and mangroves in Térraba

Maintain current RAMSAR sites Utilize other sources of energy such as solar, wind, or biomass energy

None

Destruction of RAMSAR wetlands and mangroves

IDA (Institute for Agrarian Development)

A costly demarcation of the land is not necessary

Demarcate the land using natural borders

Objective

Objective

Introduction

CONAI (National Commission on Indigenous Issues)

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Conclusion Information is often like a double-edged sword: while the opponent gathers evaluative information to devise destructive policies against the opposed, the same could hold true for the opposed holding the information against the opponent. In this era of modern technology and wide availability of information, it is essential to learn the know-how of utilizing these tools for gathering information in more positive and beneficial ways. Despite many gains, indigenous communities still face major obstacles to effective recognition of their land rights, while their territorial security is threatened and undermined by political and economic interests that promote destructive uses of indigenous lands. Observing the current conditions in Costa Rica, one might argue that development is important and necessary for the common good of society; nonetheless, this development must be equitable and based on each of the parties’ needs. It must also include the participation of all stakeholders.

Traditional Approaches to Development: Theory and Practice Many stakeholders are involved in the Boruca Dam Project; however, traditionally not all of the stakeholders would have had a voice in the project. There are many different approaches to development; however, in early development projects the general trend was for the project to be managed in a top-down approach. Projects were typically chosen, planned, and executed according to the wishes of either a government or an international lender. In recent years, development projects have focused more on grass roots, participation, social capital, and local interests. There is also an increase in outside involvement, such as environmental groups, watchdogs, and human rights advocates. Early development was often inflexible and dictated in a top-down approach. The end of World War II was the beginning of the modern concept of development. In the early days, development was an extension of colonialism in which the greater powers planned development projects for former colonies.6 Development theory often resembled colonialism and was rooted in the same dichotomy as colony and colonizer, only it had become developed and undeveloped. Early projects were often very reflective of colonialism and could be “intense and insensitive” to the local population.7 Some projects even continued with colonial struggles over land and resources.8 When projects would fail, it was frequently blamed

Introduction

9

on the failure of “local technologies.”9 The control of these projects was usually separate from the local population, and their input was not considered. During the 1950s and 1960s, central “top-down” control was standard practice.10 Colonial overtones have subsided, however, practices remain virtually unchanged. In the 1970s, a systematic approach in which a hierarchical system attempted to plan for every variable was quite popular. Any problems that arose, such as conflicts over actions or goals, were considered irrational and undesirable instead of being part of a learning and changing process.11 It became clear that there were many more variables to be considered and that the standard practice did not take into account all the challenges that would arise. In order to address complex problems, agencies implemented more rules and plans, making projects even less flexible.12 The centralized planning for every possible event did little to improve individual projects. In reality, projects often did not follow the plans exactly; however, many problems arose because of inflexible plans. Through the years, many development projects were planned by groups outside the local community, which led to wrong assumptions about capacity and local cooperation.13 Very few projects actually involved the participation of the community living in the project location. Planners also ignored the cultural implications or complications, as well as potentially valuable input from the local population.14 By failing to incorporate local input, each project had a potential for disagreement with the local population and poorer understanding of resources and other variables. A substantial amount of control lies with the larger international organizations and lenders whose funds allow them to have a considerable influence on project management. Lenders were often involved in the planning and management of projects while the direct population they influenced was left out of the process.15 The top-down model did not always produce the intended results. The benefits of development projects often failed to help the poor as trickle-down effects did not occur as intended.16 Often the rich got richer as the poor were unaffected, or ill-affected by development. Due to these problems, many changes began to take place in the way projects were planned and managed. Development theory began to change in order to incorporate a more flexible and inclusive plan. Through the years, development theory changed drastically while a change in practice and planning came about much more slowly.17 In recent years, however, the management and planning of development projects have changed, as new concerns arose from past

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CONFLICT RESOLUTION OF BORUCA ENERGY PROJECT

experiences. Planners have begun to look at projects in a larger context by examining long-term effects or external effects that the project may have.18 For example, long-term environmental impacts are being considered. These unplanned impacts require new ways of planning to address all of the effects of development. New ideas such as community management are being incorporated into development planning as development is seen less as isolated projects and more as a continual process.19 New thinking promotes greater participation at the local level. It is believed that complex problems need more localized solutions and planning should be more strategic and localized than central.20 Even larger lenders, such as the World Bank, increasingly try to promote local involvement and grass roots efforts at development.21 By having local input, specific variables can be better anticipated, and the local population is more likely to facilitate the project. It also ensures that the project will benefit, or at least not harm the local population. Once attention is drawn to the local level, new concerns for affected populations arise. Large development agencies are also increasingly incorporating protections for minority groups and the environment when implementing a project.22 As specific poverty issues gain support, it is clear that development could assist in the improvement of many aspects of life. Increasingly, other issue areas are taking on development projects, such as refugee, health, or education agencies.23 Larger agencies and lenders have also had a shift in their overall goal. The goal has become one of assisting countries and communities in managing their own resources, instead of telling them what to do.24 Instead of trying to control development the goal has become to “facilitate and encourage.”25 This means that specific communities are learning how to keep up and implement their own development, as well as control their own futures and manage their resources. For years, projects have occurred in the name of development. Early attempts seemed to continue colonial ideas and for many years the topdown hierarchy continued. Local populations had little input as to what projects should occur and how. Projects also seemed to have little real effect on the majority of the population. Following a shift in theory, local knowledge and concerns became a greater component of the planning process. Central planning was unable to account for all variables so localization of projects became the solution. The goal of development has shifted from outsiders imposing progress to experts facilitating internal capacity for growth.

Introduction

11

The change in development practice has also brought about its own set of problems. Namely, more opinions are being considered when developing projects and more people have demands regarding both large-scale development and more specific projects. One new way to examine development projects is through a mediation framework. Examining each side’s positions, interests, and needs points to areas where compromise can occur to ensure that all sides make gains. A mediation framework can be used to reach a development plan that best serves many actors. In order to establish how to come to an agreement, it is important to determine what assurances each party truly needs in a development project. In order to do this you must understand each actor’s position. Positions are the actor’s statements as to what they stand for or hope to achieve. Positions are presented to the public as final despite the fact that the actor is often flexible on these points. The actor’s public face is usually different from what they would really be willing to accept as an agreement. What prompt the positions are the interests of each group. Putting forth a position ensures that the groups protect their interests. Interests are what each side really wants out of an agreement. Most parties are willing to compromise on their positions, but not their interests. Often different actors are able to find common ground by moving from their positions to understanding each other’s interests. In negotiations, interests are usually reflective of, or slightly more than, the stakeholders’ basic needs. Behind interests lie an actor’s needs. Needs are often the same for each group, as basic human needs motivate everyone equally. The most effective development projects are those that tend to match an equal number of interests of both sides. Each stakeholder has to have their interests met in order to come to any agreement. In order to evaluate the feasibility or success of a project, one could evaluate the number of important interests each side had met. In the case of the Boruca Dam Project, the final location and size of the dam was flexible to meet the interests of the largest number of actors. Other agreements that could be met might take into account the work involved and compensation, as well as the actual project size and location. If a project meets protest, mediation could be used to get past the positions to determine the specific interests of the various parties. If stakeholders’ interests are met, they will have fewer objections to the project. The mediation concept of positions versus interests can be used when thinking about how to design projects. By taking into account that each stakeholder’s position may not reflect the desired outcome, it allows for flexibility in planning.

12

CONFLICT RESOLUTION OF BORUCA ENERGY PROJECT

When planning reaches a stalemate, it is important to discover what each side’s interests are and why they hold the position they are presenting. Changes in theory and practice of development mean that increasing numbers of stakeholders are involved in the development projects. The involvement of more stakeholders often results in more conflicts over the direction of development. In order to come to an agreement a mediation framework of positions, interests, and needs should be used. The framework can be used to plan and evaluate development projects.

Rethinking Project Design using Mediation and Conflict Resolution A number of factors are driving the current global renewable energy boom: the passage of the Kyoto Protocol, growing awareness of global carbon constraints, high prices, security risks, and international conflicts associated with securing fossil fuels from volatile regions around the world. Moreover, the economics of alternative energies are improving rapidly as the technologies mature, the industry grows, and the cost of conventional fuels increases. Bilateral agencies, international development banks, and multilateral institutions have begun large programs specifically to support alternative energy production in developing countries. In terms of international assistance, almost $500 million in renewable energy projects were invested in Costa Rica recently.26 International experience shows that governmental participation in the early stages of renewable market development is critical in creating a favorable legal framework, generating adequate institutional support, and setting long-term goals. At the same time, experience also shows that these efforts are more likely to be successful if they are undertaken with broad public support during the early stages of the development of policy. The up and coming Central America “wholesale electricity market” is even better proof that commitment to the infrastructure for renewable energy should be strengthened before the free market comes into effect. All the actors within the electricity sector need to define their positions, interests, and desired outcomes. Among other things, a renewable market development agreement must include energy delivery according to needs, price stability, increasing local jobs and development goals, decreased carbon emissions, and a reduction in other negative environmental impacts of electricity generation, improved green image, and financial support to achieve these objectives.

Introduction

13

This situation requires not only rethinking the design of electricity projects but also the public process by which the designs are conceived and implemented. The use of new ideas, innovative technologies, involvement of all stakeholders, an adequate legal and policy framework, as well as innovative financing instruments are all necessary parts of the equation.

Endnotes 1. World Commission on Dams, “Dams and Development: A New Framework for Decision Making,” The Report of the World Commission on Dams, November 2000 a. London and Sterling, VA: Earthscan Publications Ltd. 2. OmCED, 2004. 3. CDA, 2005. 4. ICE, 2005. 5. The PPP is a large globalization, market, and energy project based in Mexico and involved much of the Americas. Programs in the Americas. December 1, 2004. Global Exchange, www.globalexchange.org/countries/americas/mexico/ ppp/ppp.html (accessed June 7, 2005). 6. Monica Van Beusekom and Dorothy L. Hodgson. “Lessons Learned? Development Experiences in the Late Colonial Period,” The Journal of African History. Vol. 41, No. 1. 2000. p. 29 7. Van Beusekom, M. and Hodgson, D., 2000. 8. Ibid. 9. Ibid. 10. Rondinelli, Dennis A. “The Dilemma of Development Administration: Complexity and Uncertainty in Control-Oriented Bureaucracies,” World Politics. Vol. 35. No. 1. October 1982. 11. Rondinelli, D., 1982. 12. Ibid. 13. Ibid. 14. Ibid. 15. Goodland, R. J. A. “Environment and Development: Progress of the World Bank,” The Geographical Journal. Vol. 156. No. 2. July 1990. 16. Rondinelli, D., 1982. 17. Ibid. 18. O’Riordan, Timothy. “On the ‘Greening’ of Major Projects,” The Geographical Journal. Vol. 156. No. 2. July 1990. 19. O’Riordan, T., 1990. 20. Rondinelli, D., 1982. 21. Goodland, R., 1990. 22. Ibid.

14 23. 24. 25. 26.

CONFLICT RESOLUTION OF BORUCA ENERGY PROJECT Gorman, R., 1986. Goodland, R., 1990. Rondinelli, D., 1982. “The International Ombudsman Center for the Environment and Development 2000–2004, an Evaluative Report,” June 2004. San José, Costa Rica: OmCED.

2 Energy Production and Needs in Developing Countries Current Situation in Latin America In Latin America, abundant energy sources come together—petroleum, natural gas, coal, biomass, water, solar, and wind energies—but with very little or no distribution or synergy, hindering their effective use. Today, the majority of exports from and within the region are in petroleum, particularly due to Venezuela’s heavy production capabilities. Their abundant heavy crude reserves and distribution network facilitate a strong market of oil refining and petroleum usages due to its extreme affordability and the false belief that the oil sources are inexhaustible. However, the majority of their oil fields are not formulated to produce light and sweet crude, which produces products like gasoline and jet fuel, but rather sour crudes that primarily result in asphalt production. Therefore, strides are being made in both South and Central America to expand into the electricity and natural gas markets. The El Diquís Hydroelectric Project,1 proposed in southern Costa Rica near the town of Buenos Aires, is an important piece of the regional energy plan. It will create electrical interconnection and will have major impacts at the local level. The dam will produce energy for millions of Central Americans, but as proposed, it will also cause irreversible impacts on some of Costa Rica’s rare mangrove forests, the river ecology, the indigenous Boruca Peoples, and local Buenos Aires residents. The project is proposed in the name of progress, energy, and international regional development, often at the cost of important local interests. The scale of the regional integration plan is so large that regional decision makers must engage with

15

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CONFLICT RESOLUTION OF BORUCA ENERGY PROJECT

planners at the local level. The ecological impacts are relatively small in geographic area, however the global significance of these sites are paramount. Costa Rica plans to increase power generation capacity, particularly during the summer peak periods. Power shortages have occurred during the past few years, costing the country’s businesses millions of dollars. For instance, in May 2007, the country experienced an unexpected blackout and businesses lost an estimated $20 million. If the problem continues, experts estimate that Costa Rican businesses could lose approximately $400 million between 2007 and 2008.2 The country is in need of a boost to their power supply, particularly during the summer high peak periods. Energy shortages have been occurring throughout the country and greater Latin American region. These blackouts have become an impetus for expansion, deregulation, competitive distribution, and additional generation. However, the reality is this is not truly a crisis. Energy shortages are an exception, rather than the rule. The past decade has created a flood of capital into Central and Latin America toward energy investment. Europe and North America have seen this region as the new frontier for profitability, particularly within the growing energy sector. Increased funding has resulted in capacity expansion and reliability.3 The blackouts and shortages, which have even been seen in the United States, could have occurred primarily as a result of much needed technological upgrades and excess demand during the hot summer months. To facilitate change, improvement, and reliable supply, the major Latin American nations have engaged in talks and drawn strategies to ensure a positive and sustainable electricity supply and development in the future. Central America is currently engaged in a major, transnational planning effort—Plan Puebla Panamá (PPP)—intended to facilitate economic integration in the region through a series of large-scale infrastructure improvement and construction projects. Leaders from throughout the region conceived of the plan in the context of, and as a response to, the impacts of globalization, realizing that pooling and efficiently connecting resources will be the most efficient means of prospering within this new global structure. Like the European Union before it, new regional collaborative structures are demonstrating to the world that regional, transnational planned growth is essential for the sustainability of a healthy, global economy. The energy interconnectivity allows for growth, deregulation, and standard practices—making investment in Latin America more secure than in the previous 20 years.

Energy Production in Developing Countries

17

However, the continental planning approach will require significant regional planning. It is now a critical element in this drive to achieve sustainable economic development. Corruption, mistrust among nations, and special agreements should now manifest into cooperation, transparency, and integration for this energy approach to be successful. In addition, while executing these large-scale initiatives, it is essential that decision-making and impact analysis consider the local scale to sustainable design, so that infrastructure can minimize both social and environmental consequences. Historically, much of Central and South America’s electrical regulation reform was very experimental and created an array of practices and pitfalls. These issues were determined by the varying degree of market integration and privatization. The degree and type of involvement of different national governments and the hesitancy to allow competition, particularly due to large nationalized energy corporations, became a hindrance to the development of strong electric sectors in much of this part of the world. The first successful approach to break free from this authoritative intervention in the region can be traced back to the achievements in Chile beginning in the early 1980s. A number of significant and varied reforms have occurred and continue to manifest into successful reorganization. First, in 1982 Chile developed new legislation, which effectively privatized the major electrical sector. The neighboring countries and later much of Latin America followed this initiative through the next decade. This innovative renovation trickled into Argentina in 1993, Peru in 1993, Bolivia and Columbia in 1994, and in the Central American countries of Panamá, El Salvador, Guatemala, Nicaragua, Costa Rica, and Honduras in 1997.4 Throughout the changes, competition was encouraged at each alteration to the regulatory stage throughout and across the vertical integrative structure of the industry. This competition became the foundation for success as contracts could be established within the wholesale market, horizontal unbundling resulted in competition in generation, and open access to transmission networks, with negotiable fees, became available. In Chile alone, privatization efforts led to a more than doubling of their annual generation from 1990 to 1998, and a cut in energy losses by more than half as a result of increased productivity.5 Additional regulatory changes will certainly occur in the next decade. As multinational integration occurs and cross border transmission proliferates, this will force a convergence of practices. Technology will need to be upgraded across all nations participating and this will create a level

18

CONFLICT RESOLUTION OF BORUCA ENERGY PROJECT

playing field. Additionally, competition and privatization will be mandated if countries want to reap the benefits of additional regional capacity. Publicly funded nationalized corporations will not be able to compete with the private regional market, nor will it necessarily be tolerated as part of the transnational agreements. Although the El Diquís Hydroelectric Project is to be located in Costa Rica, the dam will supply energy far beyond its borders. Energy will flow from the Buenos Aires metropolitan region into the newly planned multinational transmission lines and substations. The energy surplus produced in the country will be exported, since the country has a stable supply during much of the year. Costa Rica is one of the most energy productive countries of Central America and realistically does not need the additional supply, outside of peak summer months. As far back as 1999, the country had a successful distribution coverage area of 93 percent of the territory and had a demand growth of only 5 percent per year with significant excess capacity. Furthermore, Costa Rica was only second to Mexico, across the entire PPP region in respect to installed energy capacity. Led by Instituto Costarricense de Electricidad (ICE) and followed by a variety of smaller companies, Costa Rica has strong generation capabilities, transmission lines, and market for its energy supply.6 Before the energy from this project can reach the other Central American countries, distribution lines will need to be created, both transnationally and within individual nations. Major infrastructure improvements are needed since much of Latin America is without power at this time. While Costa Rica and Mexico have 93 percent and 95 percent distribution, respectively, other nations are truly lacking. Guatemala, which as a whole has 67 percent coverage, sees 52 percent distribution without the inclusion of Guatemala City in the figures. These figures indicate that rural regions suffer most significantly in respect to power availability. Similarly, in El Salvador the national circulation is 65 percent of the population, however, this is also concentrated in urban areas, with only 38 percent of rural residents currently receiving power. Nicaragua services 50 percent of the country. The most unfortunate, and most dismal situation, exists in Honduras. Aside from the devastation caused by Hurricane Mitch, national circulation is at 45 percent, with only 19 percent of rural areas receiving coverage. Panamá follows Mexico and Costa Rica, at a distant third with 70 percent distribution, particularly from the heavy international investment from the transoceanic canal.7 The representation of selected national distribution systems is evident in Figure 2.1.

Energy Production in Developing Countries

19

100% 93%

90%

95%

80% 70%

65%

66.7%

70%

60% 50%

45%

50%

40% 30% 20% 10% 0% Honduras Nicaragua El Salvador Guatemala Panamá Costa Rica

Mexico

Figure 2.1 National Distribution Coverage of Selected Countries

Plan Puebla Panamá and Future Economic Integration at the Regional Scale Leaders in the region conceived of Plan Puebla Panamá (see Map 2.1) as an alternative to struggling international agreements integrating the Americas, particularly North American Free Trade Agreement (NAFTA) and Mercado Cono Sur (MERCOSUR), that will facilitate successful implementation of the Free Trade Area of the Americas (FTAA). As seen in the image below, PPP covers approximately one million square kilometers and 65 million people in Latin America’s eight countries: Mexico, Guatemala, Belize, El Salvador, Honduras, Nicaragua, Costa Rica, and Panamá.8 The intent of creating PPP is to develop a free trade area linking all of these nations. Individual national economies would be bolstered through synergy of industry, population centers would be connected with major international highways, and energy would be provided through crossboundary infrastructure projects and sharing. PPP calls for the creation of a regional wholesale electricity market, the Mercado Electrico Regional (MER); construction of the Sistema de Interconexion Electrica de los Paises America Central (SIEPAC), a 1,100 mile transmission line linking Panamá, Costa Rica, Honduras, Nicaragua, and El Salvador; and the construction of interconnectors connecting Mexico, Belize, and Guatemala with the SIEPAC.9 Initiated by Mexican president Vincente Fox, the underlying goal of the PPP is poverty alleviation. The PPP nations will be closely

20

CONFLICT RESOLUTION OF BORUCA ENERGY PROJECT

Mesoamerican Nations Belize Costa Rica El Salvador Guatemala Honduras Mexico Nicaragua Panamá

0 1.5

3

Decimal Degrees 6

Map created by Dan Moscovici December 2007

Map 2.1 Plan Puebla Panamá

observed to determine whether improvements in global human development indexes, benchmarks of health and prosperity in respect to poverty, as measured by the United Nations Development Program occur.10 Mexico will take the lead, and immediately begin construction of the “great corridors of highways and railroads, of pipelines and electric lines, of ports and airports,” to quickly, and efficiently connect all the development zones between Panamá and Mexico.11 The El Diquís Hydroelectric Project12 is the most significant individual project. While not the most significant part of the PPP megaprojects, electrical interconnection (using hydropower) is currently budgeted at 11.1 percent of all funding, second only to highway projects, which is by far the dominant element, constituting 85.2 percent of the total projected budget.13 Overall, the regional plan and energy infrastructure growth throughout Central America have major international financial backing, with the Inter-American Development Bank (IADB) pledging $10 billion of the total $20 billion in project costs for all infrastructure projects. Costa Rica is in the greatest position to spearhead the initiation of this regional plan.

Energy Production in Developing Countries

21

With a strong ecotourism industry and a booming computer chip manufacturing sector, the country is not only central geographically, but also can be considered a keystone for overall development and interconnection in the region. In order to provide energy to those parts of the region without distribution, particularly the rural areas, SIEPAC will build electrical transmission lines linking all of Central American nations. Costa Rica’s strategic hydroelectric projects will therefore not only benefit residents domestically, but will also have the ability to sell power surpluses during peak demand periods. This will facilitate supply to neighboring countries through the improved distribution network.14 This has a multiple net economic effect. Initial infrastructure improvements will be partially funded by IADB and participating nations. The project will be built in Costa Rica where residents can benefit from increased supply. Additionally, economic revenues can be multiplied by ICE and benefit the national economy. There is a great opportunity for electrical integration and distribution to be effective, however many problems persist. First, planners at the regional level are ignoring significant environmental considerations to ensure construction of the megaprojects. Simultaneous efforts at creating a Central American biological corridor have led the proponents of the PPP to disassociate any integration of the two proposals due to conflicts and environmental impacts.15 In addition, individual plans violate country agreements and protection strategies, such as the mangrove site in Costa Rica called Térraba–Sierpe, a Ramsar-designated Wetland of International Importance.16 Ramsar protected Wetlands are areas that are protected through the Ramsar Convention signed in Ramsar, Iran in 1971.17 This convention is an international treaty that provides a framework for the conservation and wise use of wetlands and their resources. Second, and possibly more significant, is the disregard for local decisionmaking. The presidents of Mexico, the IADB, and the World Bank are the architects of this plan. With billions of dollars invested, and politics closely related to outcomes, they have consistently disregarded impacts at the local scale and the opinions of local residents as insignificant in the regional planning picture.

Conclusion The regulatory framework changes that have been occurring over the past 30 years have revolutionized Latin America. Starting in the legislature of Chile and filtering throughout much of Central and South America, the region is now poised to have significant growth and competitive success.

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CONFLICT RESOLUTION OF BORUCA ENERGY PROJECT

International investment from the IADB, Europe, and North America has facilitated a pool of capital for the construction of large megaprojects and transmissions infrastructure. As shortages and blackouts get replaced with excess capacity and transnational exchanges of energy, economic development has the potential to transform this region into a global powerhouse not yet seen in the global economy. In an era of globalization, possibly considered a new golden age of knowledge, communication, and culture, Latin America has the opportunity to create a new paradigm of sustainable development, one that proactively moves beyond construction of dams and power lines. Electrical power can integrate institutions, government, people, culture, places, and act as a link between ecology and politics. Proponents of the electrical expansion and the PPP are on the verge of an exciting and potentially radical plan for improving the lives of millions of people in Central America; however, planners must take into account the effects on the economy, the environment, and the society; the entire spectrum of the triple bottom line.18

Analysis of the Energy Sector in Costa Rica In 2002, Costa Rica generated 98 percent of its electricity from renewable sources; 80 percent hydroelectric, 15 percent geothermal, 3 percent wind; and 2 percent from fossil fuel combustion, making it by far one of the most clean electricity sectors in the world. As of 2002, Costa Rica had an installed capacity of 1,713 MW of which hydroelectric provides 74 percent; fossil fuel plants 14 percent; geothermal 8 percent; and wind 4 percent. Unfortunately, Costa Rica is poised to lose its leading role in clean power. Under ICE’s 2002 best case operational plan, by the year 2020, hydropower will decrease to 67 percent, fossil fuels will increase to 29 percent, and geothermal and wind combined will account for only 4 percent of the total power generated. In the worst case scenario, given that two controversial large hydroelectric dam projects are stalled (El Diquís and Pacure), fossil fuel electricity generation could increase to 50 percent of total installed capacity, with wind and geothermal combined making up only 3 percent.19 None of these expansion scenarios include a significant role for other alternative energies such as solar or biomass. The Costa Rican electricity sector faces a number of pressures from changing global and regional regulatory trends. This small country is historically a social democracy and has resisted pressures toward privatization and deregulation, especially in sectors that have been considered social goods, including the electricity sector. The Central American Free Trade

Energy Production in Developing Countries

23

Agreement (CAFTA) requires liberalizing telecommunications and energy markets in Costa Rica and stipulates that ICE cannot claim a greater monopoly share of the electricity market, above the 85 percent of generation it already legally controls. Another challenge will come in 2008 when the Central American Wholesale Electricity Market takes effect. This greater cross-border grid connection will open up Costa Rica’s electricity sector to competition from neighboring grids. These challenges will have major implications for the nation’s electricity sector and consequently on the state’s monopoly of electricity and telecommunications. The Costa Rican legislature is presently engaged in an ongoing debate over the Law to Modernize and Strengthen ICE, a controversial reform law that could significantly restructure the utility. The current debate pits two political poles against each other. On one end of the political spectrum, trade unions are fighting to retain the status quo, a strongly regulated state monopoly, while at the other end, private industry groups argue for the privatization of ICE’s generation capacity and a shift to an exclusively transmission and regulatory role for the state company. Both sides have valid arguments. The union aims to protect consumers from possible high costs and the insecurity of leaving a vital social good, electricity, to rent seeking corporations. Private industry seeks to reduce the inefficiency and bureaucracy of Costa Rica’s largest employer and to promote innovation, especially in new renewable technologies. Figure 2.2 shows the organization of the Costa Rican Power Sector.

President of the Republic Autoridad Reguladora de los Servicios Públicos (ARESEP)

ICE

CNFL S.A.

Ministerio del Ambiente y Energía (MINAE)

Municipal Companies

Cooperatives

Private Companies

JASEC

Coopelesca

ESPH S.A.

Coopesantos Coopeguanacaste Coopealfaro-ruiz

Source: ARESEP, 2006

Figure 2.2 Organization of the Costa Rican Power Sector

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CONFLICT RESOLUTION OF BORUCA ENERGY PROJECT

The electricity sector is regulated and guided by two government ministries—the Ministry of the Environment and Energy (MINAE: Ministerio de Ambiente y Energía) and the Regulatory Authority for Public Services (ARESEP: Autoridad Reguladora de los Servicios Públicos). MINAE provides the guiding vision and sets goals for the national electricity sector through policy documents. MINAE must also approve plans for new generation plants according to environmental criteria. ARESEP determines the tariffs that ICE and the distribution companies charge their clients, as well as the tariffs that ICE pays to private companies to buy electricity. Secondary actors in the electricity sector include industry organizations such as ACOPE, the Costa Rican Association of Private Energy Producers, and LAICA, a sugar industry organization; environmental groups, such as Aprefloflas; university departments that work on energy research, including the National University’s Solar Research Lab; the national press; and civil society, including unions and university students, as well as consumers. Over the past five years, there has been tremendous civil society response to electricity policy. ICE plays the dominant role in Costa Rica’s electricity sector. ICE is a government-owned, vertically integrated electricity and telecommunications utility. The semiautonomous company is charged with coordinating and planning both the electricity and telecommunication sectors in Costa Rica. The company was originally structured as an independent entity with a technical general manager. However, in 1974, ICE was restructured with an executive president and board of directors overseeing the general director. The executive president is appointed by the President of the Republic. The board of directors consists of four appointees from the winning political party and three from the losing party. ICE is responsible for 100 percent of electricity transmission, 39 percent of distribution, and 78 percent of generation. CNFL, Compañía Nacional de Fuerza y Luz, another state company that is within the Grupo ICE or Groups of ICE companies, is involved predominantly in electricity distribution, transmitting 42 percent of the national total, but the company is also involved in production of electricity (9 percent). Two municipal companies and four cooperatives cover the rest of electricity distribution in Costa Rica. These companies also produce 3 percent of the electricity in Costa Rica. Private companies, including small hydroelectric projects, sugarcane refineries, and wind plants, produce the remaining 11 percent of electricity in Costa Rica. All of the electricity they produce must be sold

Energy Production in Developing Countries

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ICE Production

77%

Municipal Companies JASEC, ESPH

CNFL

3% 3%

9% 5%

78%

HYDRO

GEOTHERMAL + WIND

THERMAL

54% 63%

8% 13%

15% 1%

Private companies

11% 14%

ICE Transmission

CAPACITY GENERATION

LOSSES 10%

100%

JASEC, ESPH

CNFL

ICE

Cooperatives (4)

11%

42%

39%

8%

Distribution

Net importacion exportacion

SALES KWH

ARESEP/Alvaro Source: ARESEP, 2006

Figure 2.3 Structure of Costa Rican Electricity Sector 2003

to ICE who then transmit to distributors. Figure 2.3 shows the structure of the Costa Rican Electricity Sector in 2003.

Policy Setting Every four years, the newly elected government articulates a “Plan Nacional de Desarollo” (National Development Plan). From this guidance, MINAE develops the “Plan Nacional de Energia” (PNE—The National Energy Plan). The plan is written by all actors within the energy sector including relevant ministers, representatives from ICE, CNFL, private industry, rural cooperatives, municipal distribution companies and civil society. The PNE IV, written in 2002, set the following goals for the national electricity sector: z z

Ensure that energy development contributes to maintain the social, economic, and environmental equilibrium; Ensure that the electricity sector contributes to the sustainable development and improvement in the quality of life of all citizens;

26 z z

CONFLICT RESOLUTION OF BORUCA ENERGY PROJECT

Reduce the vulnerability of the energy infrastructure and external dependence; Maintain the dominant State role in the energy sector (PNE IV).

The PNE IV also identifies the following as the principal problems in the energy sector: z z z z z

Excessive dependence on external energy sources; Limitations in the capacity of the energy sector; Low utilization of alternative energy sources; Inefficient energy use; Problems in energy legislation.

In response to these problems, MINAE developed specific objectives such as efficiency, competitive markets, and increased dependence on local resources and renewable energy. The PNE also calls for extensive civil society participation, and increased coordination and communication within the sector, including biannual meetings between all members of the electricity sector. Unfortunately, few of these objectives have been met. Particularly, the PNE lacks effective monitoring, evaluation, and enforcement mechanisms, reducing the plan to little more than good intentions. The weakness of the Ministry’s National Energy Plan is also apparent when compared with ICE’s Plan de Expansion de Generacion (PEG). ICE’s PEG claims to be developed within the guidelines and mandates of MINAE’s PNE. There are, however, clear discrepancies between the two plans. Whereas MINAE’s plan calls for a move toward nonconventional renewable energy sources and increased reliance on renewable sources of energy, ICE’s plan moves the country away from renewable sources toward fossil fuel plants. Unfortunately, ICE’s top management allocates funds toward projects and departments within the organization according to the recommendations of the PEG not the PNE. To comply with the PNE’s mandate that ICE research nonconventional renewable energy resources, the planning department wrote the Plan de Desarollo de Fuentes Nueves de Generacion Renovables y No Convencionales Periodo 2004–2008 (Development Plan of New Sources of Generation, Renewable and Nonconventional).20 This document presents a perfunctory analysis of renewable energy exploitation in Costa Rica. This document references studies of resource potential in Costa Rica that were completed 15 to 20 years ago.

Energy Production in Developing Countries

27

Legal Landscape The national electricity sector is regulated by the laws that created ICE, ARESEP, and CNFL and gave them their mandates. Law 7200, modified by Law 7508, is one of the most important in electricity policy in Costa Rica. This law protects the dominant role of ICE in the electricity sector, limiting the amount of electricity produced by private industry to 15 percent of total national capacity and to plants no larger than 20 MW. A later amendment to this law allows for an additional 15 percent of national capacity in Build-Operate-Transfer (BOT) plants. According to this amendment, private companies can build electricity plants, operate them for 15–20 years, and then sell the plant to ICE. These plants can produce up to 50 MW. The law also stipulates that 35 percent of any private electricity company must be owned by a Costa Rican national. A more recent Law 8345 allows the rural electricity cooperatives and municipal companies to generate electricity for their customers without size limitation and to sell excess electricity to ICE. The limitations of Law 7200 create significant inefficiencies in the electricity sector. Many actors within the sector, including employees of ARESEP and ICE, believe that this law leads to higher costs for consumers and to challenges for renewable energy production. Under the restrictions of the law, private companies cannot take advantage of natural returns to scale. For example, “El Viejo,” the country’s second largest sugar refinery, is currently negotiating a 15-year contract with ICE to produce 4 MW of electricity from burning bagasses, the waste material of sugar production. With the amount of bagasses produced every year, El Viejo could generate as much as 27 MW at very little extra cost. Instead the excess will be burned outside of the generator. Another private hydroelectric company, Energia Global, has built an unnecessary border down the middle of its plant and uses two generators to comply with the limitation of generation of 20 MW. Moreover, if ICE cannot increase generation capacity, the law prohibits increased participation by the private sector beyond 15 percent despite ability, willingness, and cost competitiveness. Indeed, ICE is now trying to resolve the imminent power shortage, including entering into more contracts with private companies, however, its options are limited by Law 7200. Another limit to private competition comes from ARESEP’s rate structure, which determines rates using a cost-of-service calculation similar to traditional utility rate calculations in the United States. The rates are based on capital costs and operating expenses plus a rate of return. The rate of

28

CONFLICT RESOLUTION OF BORUCA ENERGY PROJECT

return is based on other market opportunities of similar risk. As a result of ARESEP’s rate system, if a private company can build a cheap, efficient alternative energy plant, they will be paid less per kilowatt hour than other higher cost generation plants. Law 7447, the “Rational Energy Use Law,” passed in 1994 established a mandate for ICE and MINAE to execute rational energy programs in companies with high energy consumption levels. The law was passed to support the newly formed National Commission of Energy Efficiency, which was established by an Executive Decree under MINAE and mandated to prepare and execute a national program of energy efficiency. The legal environment is also impacted by Law 7848, the Tratado Marco del Mercado Eléctrico de América Central, ratified in 1998, which lays the framework for a wholesale electricity market within Central America and Panamá called SIEPAC. Beginning in 2008, more cross-border transmission lines will be constructed between Central American countries. The Costa Rican electricity sector will face competition from neighboring electricity sectors. According to the agreement, only ICE can buy and sell electricity to neighboring grids. However, many actors within the sector are pushing to allow private industries and generators to independently buy and sell electricity in the Central American market. In order to address the shortcomings in the electricity sector and the incongruencies with international agreements, UCCAEP, the Costa Rica Union of Private Company Associations, argues in their report, “Modernization and Strengthening of the National Electricity Sector,” for the creation of a competitive electricity market within Costa Rica. A competitive market could allow independent power producers to sell energy directly to consumers, be they municipalities, industries, or cooperatives, without the intervention of ARESEP or ICE. UCCAEP contends that modern electricity systems separate the commodity of electricity from the service of transmission and distribution. The industry organization suggests that ICE and the government should shift away from production monopoly to a regulatory role. Reforming ICE, however, has proven to be extremely controversial because of the company’s strong union and its legacy as a symbol of national pride. In 1999, citing falling standards and the requirements established by the Central American Wholesale Electricity Treaty, Costa Rica’s legislature approved the draft of a law known as the Combo, which would have restructured ICE. The law consisted of three stages spread over five years. The first stage would have split ICE into two separate companies selling telecommunication services (ICEtel) and power (ICElec). The second stage

Energy Production in Developing Countries

29

of the process would have liberalized Costa Rica’s phone and electricity markets. In the final stage, ICEtel and ICElec would seek joint ventures with private companies, maintaining 51 percent ownership.21 In March 2000, in response to the law, ICE’s trade union, the largest and most influential in the country, along with university students organized massive demonstrations and road blocks that brought the country’s capital to a standstill. In April of 2000, Costa Rica’s Supreme Court ruled the initiative unconstitutional. In response to the national protests, the government created the Special Mixed Commission for the Strengthening and Modernization of ICE, with representatives from civil society, the legislature, and private industry. Their mandate was to study, analyze, and give recommendations on a new ICE reform law. In August 2005, the legislature disbanded the commission, claiming that internal gridlock prevented it from accomplishing its mandate. Instead a new commission will be formed consisting solely of legislators. The disbanding of the commission instigated new protests by ICE’s union, students, and other members of civil society. Reforming ICE has become even more pressing as SIEPAC deadlines approach. The Costa Rican legislature is currently constructing an understandably controversial ICE reform law, referred to as the Law to Modernize and Strengthen ICE. It seems thus far that the Costa Rican legislature and regulatory bodies have been unable to change the regulatory environment.

The 2005 Generation Plan Electricity demand is expected to increase between 4.65 percent and 5.4 percent over the next 20 years, bringing the country’s total power demand to between 4000 and 4700 MW. To meet the country’s 250 percent increase of electricity demand between the years 2006 and 2025, ICE’s 2005 recommended operational plan, the Plan de Expansión de la Generación Eléctrica 2006–2025,22 calls for the installation of 38.3 percent fossil fuels, 53.3 percent hydro, mostly very large scale, and 8.2 percent geothermal and wind projects.23 In the “worst” case scenario, given that the “El Diquís Project,” expected to produce 622 MW, is stalled, fossil fuel electricity generation would make up 50 percent of new installed capacity.24 Under these plans, fossil fuel generation would be required to meet base load demand and thus would also make up a much greater percentage of generation. None of these expansion scenarios include a significant role for other renewable sources such as solar or biomass. Figure 2.4 shows the total installed capacity in megawatts.

30

CONFLICT RESOLUTION OF BORUCA ENERGY PROJECT

MWs

Total Installed Capacity (MWs)

6000 5000 4000 3000 2000 1000 0

Other Wind Geothermal 2004

2025Recommended

2025No El Diquís

Fossil Fuels Hydro

Source: ICE, 2006

Figure 2.4 Total Installed Capacity

The PEG25 dismisses nonconventional renewable energy, arguing that the most optimistic projections show that it will be more than 20 years before these technologies are cost competitive with large-scale hydroelectricity and fossil fuel generation. Using obsolete and perfunctory studies of resource potential, some from as far back as 1980, the PEG26 concludes that 50 percent of identified renewable power resources in Costa Rica have already been exploited. This conclusion is based on absurd numbers, suggesting that the country only contains 95 MW of potential biomass energy, already less than the 120 MW of sugarcane waste production identified by cane producers alone. The planning department’s conclusion also does not consider solar or any new renewable resources. At the same time the PEG27 expands in detail on the possible future use of natural gas in Costa Rica. The planning department considers natural gas to be a very viable option, despite the expensive infrastructure needed to either construct a gas pipeline to Costa Rica from Colombia or Mexico, or transport liquid gas by tanker and then re-gasify it in the country. Further, it does not consider recent high gas prices in its transportation estimates.

Endnotes 1. ICE, 2007. “Proyecto Hidroelectrico El Diquís (PHED).” Documento del Proyecto. San Jose, Costa Rica: ICE. 2. Schmidt, Blake. “Emergency Declared Amid Energy Shortage,” the Tico Times. April 27, 2007. 3. Rudnik, H. and Zolezzi. J. “Electric Sector Deregulation and Restructuring in Latin America: Lessons to be Learned and Possible Ways Forward,” IEE Proceedings on Generation, Transmission and Distribution. Vol. 148, No. 2. 2001.

Energy Production in Developing Countries

31

4. Rudnik, H. and Zolezzi, J., 2001. 5. Fischer, Ronald and Serra, Pablo. “Regulating the Electricity Sector in Latin America,” Economia. Fall. 2000. 6. IADB, 1999. “Profiles of Power Sector Reform in Selected Latin American and Caribbean Countries.” 7. IADB, 1999. 8. Pickard, Miguel. “The Plan Puebla Panamá Revived: Looking Back to See What’s Ahead,” La Chronique des Ameriques. No. 12. April 2004. 9. Energy Information Administration, 2008. “Official Energy Statistics from the US Government: Central America Electricity.” http://www.eia.doe.gov/ emeu/cabs/tbl5b2.html 10. Pisani, Michael J. and Label ,Wayne A. “Plan Puebla-Panamá: Toward FTAA or Regionalism?” Business Horizons. Sept. /Oct. 2003. 11. Flynn, Matthew. “Fox Strives to Spread Maquiladoras South.” Borderlines Updater. August 7, 2001. 12. The El Diquís Project was formerly known as the Veraguas-Diquís hydroelectric project. 13. Pickard, Miguel. “The Plan Puebla Panamá Revived: Looking Back to See What’s Ahead,” La Chronique des Ameriques. No.12. April 2004. 14. Antinori, Marcelo. “Plan Puebla-Panamá: Myths and Reality.” IDBAmerica December 7, 2007. Pisani, Michael J. and Label ,Wayne A. “Plan Puebla-Panamá: Toward FTAA or Regionalism?” Business Horizons. September/October 2003. 15. Pickard, Miguel., 2004. 16. Jensen, Laura B. “From Conflict to Consensus? A Case Study of Costa Rica’s Proposed Veraguas-Diquís Hydroelectric Project.” Yale University Thesis Project. 2007. 17. “The Convention on Wetlands of International Importance Especially a Waterfowl Habitat,” adopted in Ramsar, Iran, in 1971 (entered into force, 1975) and known as the “Ramsar Convention.” 18. Toly, Noah J. “Changing the Climate of Christian Internationalism: Global Warming and Human Suffering,” The Brandywine Review of Faith and International Affairs, Vol. 2, No. 2, 2004 19. Instituto Costarricense de Electricidad (ICE), 2004. “Contexto Socioeconomico y Cultural del Proyecto Hidroelectrico Boruca.” Buenos Aires, Costa Rica: ICE 20. Instituto Costarricense de Electricidad (ICE), October 2003. “Plan de Desarollo de Fuentes Nueves de Generacion Renovables y No Convencionales Periodo.” San Jose, Costa Rica: ICE. 21. Toledo, Rebeca. “Costa Ricans Fight Privatization of Electrical Industry.” Workers World, April 27, 2007. www.workers.org/ww/2000/costa0427.php 22. Instituto Costarricense de Electricidad (ICE), January 2006. “Plan de la Generacion Electricidad 2006-2025.” San Jose, Costa Rica: ICE.

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CONFLICT RESOLUTION OF BORUCA ENERGY PROJECT

23. ICE, 2006. 24. Instituo Costarricense de Electricidad (ICE), 2004a. “Plan de Expansion de la Generacion Electrica 2004–2020.” San Jose, Costa Rica: ICE. 25. ICE, 2004a. 26. Ibid. 27. Ibid.

3 Analysis: Hydro-Project Boruca, Costa Rica History of the Project The Boruca Hydroelectric Project (PH-Boruca) is a controversial dam project proposed in southern Costa Rica by the state run corporation Instituto Costarricense de Electricidad (ICE). ICE first proposed the project in 1970. Since then it has met with significant local and national opposition. The initial project proposed to construct the dam in the Boruca Canyon, changing the flow of the Térraba River and creating an enormous artificial lake of 25,000 hectares. The Boruca Hydroelectric Dam was originally planned in combination with an aluminum production plant. At that time, the Costa Rican government granted a 25-year mining concession to a transnational company called ALCOA. The agreement required ALCOA to refine a portion of the aluminum in Costa Rica, with an understanding that the Costa Rican government, through ICE, would build a hydroelectric dam to provide the enormous amounts of necessary energy.1 Heavy protests against the projects ensued and convinced ALCOA to pull out of the project.2 In 1975, the Tropical Science Center completed an Environmental Impact Assessment for the original project.3 They concluded that the most important impacts of the project include: z z

alteration of the ecology of the delta of the Térraba River because of the loss of the positive effects of fluvial sedimentation; increase in the frequency and intensity of earthquakes in the area as the dam will be constructed near a major active fault line;

33

34 z z z

CONFLICT RESOLUTION OF BORUCA ENERGY PROJECT

acceleration of the deterioration of the soils, vegetation, and the hydrological regime; problems of flooding and control of water below the dam; and loss of archeological sites.4

The Boruca Project, however, was revived as a source of energy for the growing demands of electricity in Costa Rica and to generate power for sale to the neighboring countries. This megaproject would generate approximately 1,500 MW, becoming the largest hydroelectric project in Central America. With a height of 230–260 meters. the artificial lake created will hold 6,483 million cubic liters of water and inundate 25,000 hectares. The Boruca Dam would significantly increase Costa Rica’s energy production capabilities, by perhaps as much as 50 percent. Constructing the dam would require rerouting approximately 50 kilometers of the Pan-Inter-American Highway. ICE would then construct the new highway between Buenos Aires de Puntarenas, Boruca, and Térraba.5 According to ICE,6 the Boruca Hydroelectric plant would be directed at satisfying the national electrical demand, generating safe, low-cost energy with state-of-the-art technology. It would improve the quality and stability of the national electrical system and would create an opportunity for the development of technological corridors and electrointensive industries. The Boruca Dam would allow for electricity generation and diverse potential uses, such as recreation, control of floods, tourism, and others. From the perspective of ICE, the Boruca plant7 would be a factor in the development of the southern region as well as the country as a whole. It would provide sources of employment during both its construction and its operation. It would create synergies in the region between the indigenous and nonindigenous communities, and the State of Costa Rica. It would promote the preservation of ethnic and cultural identity, as well as contribute to human development in the region. It would create a better quality of life for all those living there, as well as for all inhabitants of the country, in particular, for the neighboring populations. The Boruca Plant would ensure clean and renewable energy, thus not adding to the increase in global warming, and independence for the country in fossil fuel use. The plant would actively participate in the recovery and conservation of the “Grande de Térraba River Basin” and in the sustainable exploitation of its resources.

Analysis: Hydro-Project Boruca, Costa Rica 2000

2004

35

2008

2012

FEASIBILITY

DESIGN AND FINANCING

?

CONSTRUCTION ?

ENTRY INTO OPERATION ?

Source: ICE, 2002

Figure 3.1 Project Schedule

In Figure 3.1, programming of the project can be seen, according to ICE plans. In 2004, ICE contracted with a Colombian company, INGETEC S.A., for 18 months, with financing by the Inter-American Development Bank (IADB).8 The object of this contract was to help ICE in the selection of the optimal plan of development for the Grande de Térraba River Basin and to do a feasibility study about the environmental impact of the Boruca Dam. The results of this study are not known, because they were not published.9 The idea of the project was to establish a dam in the well-known zone of “Cajón de Boruca”, located 14 kilometers east of Palmar, where the channel would leverage the Térraba River, flooding it and creating an artificial lake. Notwithstanding, another strongly advocated option was the possibility of constructing a dam in the General River Bed, where a channel for the water would be constructed, taking in the sector known as “Las Pilas.”

36

CONFLICT RESOLUTION OF BORUCA ENERGY PROJECT

The water would be transported through a 13 kilometers tunnel to the processing station near “Cava Blanca,” a few kilometers west of Palmar. What is clear is that by choosing the General River option, the height of the dam would be lower, as would the installed capacity of generation. In addition, the required tunnels and processing station would be located in a sector away from the lagoon.10 In the event that the project would be constructed in the Térraba River sector, it would be necessary to relocate about 2,000 to 3,000 indigenous people. The General River option would affect areas of indigenous people to a much lesser extent. What produced the greatest resistance and rejection of the Boruca Dam was the necessity of transferring people. This has also happened with the Arenal Dam in the north of Costa Rica. Population displacement creates upheavals in the affected communities and in the communities that receive the displaced persons. Flooding areas containing archaeological wealth or historical monuments also would generate problems and rejection. Another aspect of this dam that caused conflicts was the plans for the expropriation of, and payment for, the land. The flooding of existing routes of communication would also cause upheavals, requiring the development of new routes of communication between both sides of the dam. The construction of a dam impacts people, land, water, and flora and fauna. For people, dams can be influential in improving living standards and in generating employment. They can eliminate malarial areas and improve health. They can, however, also cause diseases like bilharzias in tropical areas when used for irrigation. A dam can impel industrial activity in the area. But perhaps most relevant is the recreational and tourist activity that the dam could attract. In the areas surrounding the “Arenal Dam, Tilarán, Nuevo Arenal, and La Fortuna”, a great deal of tourism development has taken place. It is necessary, however, to be careful; tourism can also bring environmental and social problems such as drugs, prostitution, and alcohol abuse.11 In summary, there are a series of questions and unknowns to be acknowledged, such as: z

Will there be solid, recognized entities that finance a project, which affects indigenous populations, archeological, and wetland sites? The directives of organizations such as the IADB or World Bank oppose such a concept. This question has resurfaced after the report by the World

Analysis: Hydro-Project Boruca, Costa Rica

z

z

37

Commission on Dams (WCD) that calls on international organizations to not finance large projects such as the Boruca Dam, because the questions of indigenous peoples and environmental impacts have not yet been resolved. The Costa Rican Constitution, the Indigenous Law, and the International Labour Organization Convention No. 169 all protect the rights of indigenous peoples. These legislative organs mandate that indigenous peoples be consulted, that they voluntarily accept the project, without being pressured, and that they be fairly compensated materially and spiritually for any losses caused to them by a project. What will be the participation of indigenous people in the technical, economic, and political discussion of the project, in the feasibility phases, and in the design and construction? The indigenous peoples are the owners of the lands that would be flooded, of some of the sites that would be used to extract materials and dump trash, and of the forests that guarantee these people pure water.

Who will pay for indigenous people to defend themselves legally? For some time now, the indigenous people have been incurring increasing expenses in defending themselves. What will be the participation of indigenous peoples in the profits from the project? The way to make the project just, perhaps the only way, is by making them partners. Like any civil works project of this scale, the Boruca Dam project is comprised of very complex elements—financial, environmental, and political. There are also aggravating elements such as archeological, native, and wet-lands; relations with Panamá; messy land tenancies and land ownership issues; nonindigenous persons with fields on indigenous peoples’ land; and property without cadastre12 or deed. All of these factors exist within a context of dramatic and historical racial conflict that needs to be considered. High degrees of national and governmental commitment are necessary to ensure that, as a vulnerable population, the indigenous people are not trampled on or their rights and culture violated.

Legal Framework and Policies For almost two centuries, a series of legal mechanisms such as decrees, orders, and resolutions have been developed to guide government action with respect to indigenous populations, dealing in general terms with the behavior and relation of nonindigenous persons with the inhabitants of

38

CONFLICT RESOLUTION OF BORUCA ENERGY PROJECT

indigenous villages, the usurpation of their properties, and of their liberties and rights as citizens. The International Labour Organization (ILO) proclaimed Convention No. 107, The Convention Concerning the Protection and Integration of Indigenous and Other Tribal and Semi-Tribal Populations in Independent Countries, stating there are independent countries that keep their indigenous populations in conditions of economic, social, and cultural marginality, and that such peoples have not managed to gain access to benefits and rights like the rest of the population. To overcome and prevent these conditions, the ILO Convention ensures the rights of these peoples and recognizes fundamentally their ownership of the land that they have traditionally inhabited. Costa Rica adopted Convention No. 107 by means of Law No. 2330 on April 9, 1959. In 1973, by means of Law No. 5251, the National Commission on Indigenous Affairs was created and soon thereafter modified by Law No. 5671 in 1974. This normative framework establishes, as an institution of public law, legal capacity, and personal assets, and confirms the General Assembly as the representative authority of the indigenous population.13 Subsequently, Indigenous Law No. 6172 of 1977 recognizes the indigenous identity, the right of self-determination, and protects the cultural estate and possessions of indigenous peoples. This legal instrument is principally directed toward the ratification, allocation, and protection of territories of indigenous peoples. Also Regulation No. 8487-G of 1978 is important to note because it was in this law that the Association of Integral Development14 was recorded as the formal and official organization of representation and legal standing, and agency of indigenous peoples. More specifically indigenous peoples, by law, have the following rights as proclaimed by the Indigenous Law of 1977: z

z

By means of Executive Decrees, several indigenous reserves were created. A decree is a dictated disposition of the Executive Power, signed by the President and a Minister, but is subordinate to the Indigenous Law itself. A decree can be modified or countermanded by another executive decree or law. However, according to the Indigenous Law, the limits of indigenous reserves may only be decreased by a law approved by the Legislative Assembly. The Indigenous Law granted reserved property to indigenous communities (Article 2). According to the law, the indigenous reserves are inalienable (they cannot be sold, bought, rented, occupied, or otherwise

Analysis: Hydro-Project Boruca, Costa Rica

z

z z

z

z z z z

39

used by any other peoples), nontransferable, and may only be lived on by indigenous communities (Article 3). Indigenous peoples may only negotiate their lands with other indigenous peoples. All negotiation, transfer of lands, or improvements done to said lands between natives and nonindigenous shall be absolutely null and void (Article 3). The territories of the reserves, the improvements realized therein, and the products thereof shall be free of all class of taxes. The indigenous reserves shall be administered by the indigenous peoples by means of their own traditional community structures, under the coordination and consultation of The National Commission for Indian Affairs (CONAI). The law defines what is meant by indigenous community, defining it as a population that lives on a reserve and is administered by a council who represents that population. This administrative council can name auxiliary committees if the reserve is very large. The law grants to each indigenous community legal capacity; that is to say, it has the right to and can contract obligations in the name of the community. If the reserves are invaded by nonindigenous persons, the authorities must effectuate their removal. Only indigenous peoples can construct houses, destroy trees, control timber-yielding resources, and plant crops within the reserves (Article 6). Mineral resources found below the ground soil of the reserves are the property of the state and the indigenous communities. The forest lands within the reserves must remain so.

Within indigenous communities, their own traditional forms and organizational structures shall be the controlling bodies (La Gaceta, 1978). Article 3 of the regulation established that indigenous communities must adopt the organizational structure of Communal Development Associations in order to exercise the rights contained in the Indigenous Law (La Gaceta, 1978). The territorial administration of the reserve, the judicial or nonjudicial representation before outside institutions and persons, must be in charge of the Communal Development Association. In this way, the will of the indigenous communities is asserted to the state and private institutions that are referred to the land administration. This was confirmed by Sala IV (La Gaceta, 1978). ILO Convention No. 16915 is extremely important, as it is an international treaty ratified by Costa Rica.16 This means that this treaty ranks

40

CONFLICT RESOLUTION OF BORUCA ENERGY PROJECT

above Costa Rican law, subordinate only to the Political Constitution. ILO Convention No. 169 recognizes the human rights of indigenous peoples. The ILO Convention No. 169, therefore, has greater force than a law and Costa Rica is bound to fulfill the established obligations. If the state makes an act or dictates a norm that fails to fulfill the terms of a ratified convention, it is possible to present oneself at Sala IV, the Costa Rican mechanism for reviewing laws when a human rights violation claim has been made. One can request the cancellation of the law, which violates the human rights of indigenous peoples as contained in the agreement. Regarding the tactical mission of the dam project, the most important articles of the ILO Convention No. 169 are as follows: z

z

z

z

z

Article 6: The governments must consult the peoples concerned, through appropriate procedures and in particular through their representative institutions, whenever consideration is being given to legislative or administrative measures, which may affect them directly. Article 7: The governments must take the necessary measures, in cooperation with the indigenous communities, to protect and preserve the environment of their territories. The peoples concerned shall have the right to decide their own priorities for the process of development as it affects their lives, beliefs, institutions, and spiritual well-being and the lands they occupy or otherwise use, and to exercise control, to the extent possible, over their own economic, social, and cultural development. In addition, they shall participate in the formulation, implementation, and evaluation of plans and programs for national and regional development, which may affect them directly. Article 7 (2): The improvement of the conditions of life and work and levels of health and education of the peoples concerned, with their participation and co-operation, shall be a matter of priority in plans for the overall economic development of areas they inhabit. Special projects for development of the areas in question shall also be so designed as to promote such improvement. Article 7 (3): Governments shall ensure that, whenever appropriate, studies are carried out, in cooperation with the peoples concerned, to assess the social, spiritual, cultural, and environmental impact on them of planned development activities. The results of these studies shall be considered as fundamental criteria for the implementation of these activities. Article 7 (4): Governments shall take measures, in cooperation with the peoples concerned, to protect and preserve the environment of the territories they inhabit.

Analysis: Hydro-Project Boruca, Costa Rica z

z z

41

Article 15 (2): In cases in which the state retains the ownership of mineral or subsurface resources or rights to other resources pertaining to lands, governments shall establish or maintain procedures through which they shall consult these peoples, with a view to ascertaining whether and to what degree their interests would be prejudiced, before undertaking or permitting any programs for the exploration or exploitation of such resources pertaining to their lands. The peoples concerned shall wherever possible participate in the benefits of such activities, and shall receive fair compensation for any damages which they may sustain as a result of such activities. Article 16: …The peoples concerned shall not be removed from the lands which they occupy. Article 18: Adequate penalties shall be established by law for unauthorized intrusion upon, or use of, the lands of the peoples concerned, and governments shall take measures to prevent such offenses.

It is necessary to stress the importance of ILO Convention No. 169, not only as an international human rights instrument, but also emphasized by May 9, 1955 Vote No. 2313-95—“… the international human rights instruments effective in Costa Rica, have not only a weight equal to the Political Constitution, but in so much as they grant greater rights or guarantees to the people, prevail over the Constitution.” The Declaration on the Rights of Indigenous Peoples is another crucial instrument relating to the human rights of indigenous peoples. This declaration was recently adopted by the United Nations General Assembly on September 13, 2007. The Declaration was adopted with 143 votes in favor, one of which was Costa Rica. Although the legal nature of a declaration is nonbinding it sets a standard which the international community agrees should be upheld. It sets legal norms and the commitment of states to protect the rights of indigenous peoples. This declaration establishes that all human rights guaranteed to human beings should be granted equally to indigenous peoples (Article 1). Also included in this declaration are: (1) the right to be free of discrimination (Article 2); (2) the right to self-determination (Article 3); (3) the right to self-government (Article 4); (4) the right to maintain and strengthen political, economic, legal, social, and cultural life (Article 5); (5) the right to be free of assimilation or destruction of their culture (Article 8); (6) the right to not be forcibly removed from their lands/no relocation without free informed consent (Article 10); (7) the right to practice and revitalize their culture and customs (including archaeological and historical sites etc.)

42

CONFLICT RESOLUTION OF BORUCA ENERGY PROJECT

(Article 11); (8) the right to participate in decision-making, which affects their rights (Article 18); (9) the right to determine and develop strategies for development (Article 23/32); (10) the right to the lands, territories, and resources they have traditionally owned, occupied, used, or acquired (Article 26); (11) the right to redress, compensation for lands and territories taken, occupied, used, or damaged, which they own or have acquired without free consent (Article 28); (12) the right to conservation and protection of the environment (Article 29). These abovementioned articles are some of the many articles, which relate to the Boruca Dam project. The Boruca Dam would violate numerous of these articles, which also overlap some of the previously mentioned laws. Many of these rights will be discussed in more detail in the section pertaining to indigenous rights, revealing the potential human rights abuses if the dam were to be built. Figure 3.2 shows the interactions of the Costa Rican indigenous legislation with the political location of the regional areas influenced by the PH-Boruca.

POLITICAL SITUATION OF THE INDIGENOUS PEOPLES

– BUENOS AIRES – OSA – COTO BRUS – PEREZ ZELEDON

FOUR IMPORTANT CANTONS

GRANDE TÉRRABA RIVER BASIN

29 Community Districts w/ > 258.454 Inhabitants /1999

INDIGENOUS COSTA RICAN LEGISLATION

JURISPRUDENCE

ILO CONVENTION 169– LAW 7316 RATIFIED by C.R. APRIL, 1993

INDIGEN. LAW NO 6173, NOV. 1977

LAW CREAC CONAI JUL. 1973

Source: ICE, 2001

Figure 3.2 Legal and Political Situation of the Peoples

Sala IV

Analysis: Hydro-Project Boruca, Costa Rica

43

Electricity Policy In Costa Rica, every four years, each new government articulates a National Development Plan within the context of which MINAE develops a National Energy Plan (PNE). The one written in 2002 covers the years 2002–2016. This document contains many inspiring aspirations toward renewable, environmentally sound electricity generation with extensive civil society participation, coordination, and communication within the sector, including biannual meetings between all members of the electricity sector. Unfortunately, only few of the goals set in 2002 in the PNE have been met, and neither have the schedule tasks been accomplished. Moreover, the Energy Department of MINAE, DSE (Dirección Sectorial de Energía), seems unaware and not much concerned that the objectives of the PNE have not been accomplished. It seems to be that the PNE lacks effective monitoring, evaluation, and enforcement mechanisms—indicating that the plan is being reduced to little more than good intentions. The weakness of the document is also apparent when compared with ICE’s Plan de Expansion de Generacion (PEG). ICE’s Plan claims to be developed within the guidelines and mandates of MINAE’s PNE. However, there are clear discrepancies between the two plans. Whereas MINAE’s plan calls for a move toward nonconventional renewable energy sources and increased reliance on renewable sources, ICE’s plan moves the country away from renewable sources toward fossil fuel plants with an increase of 15 to 30 percent installed capacity by 2020. Nonconventional alternative energy sources will decrease from 8 to 3 percent by 2020. Unfortunately ICE’s plan contains the power of action and will actually be enacted. ICE’s top management allocates funds toward projects and departments within the organization according to the recommendations of the PEG. The PEG dismisses nonconventional renewable energy, arguing that the most optimistic projections show that it will be more than 20 years before these technologies are cost competitive with large-scale hydroelectricity and fossil fuel generation.17 Using obsolete and perfunctory studies of resource potential, the PEG concludes that “50% of available renewable natural resources in Costa Rica have already been exploited.”18 While at the same time the PEG devotes considerable space to expanding on the future use of natural gas in Costa Rica, despite the extensive and expensive infrastructure needed to either create a gas pipeline to Costa Rica from South America or transport liquid

44

CONFLICT RESOLUTION OF BORUCA ENERGY PROJECT

gas by tanker and then regasify it in the country. The recommended PEG even includes the construction of four gas turbine plants between 2010 and 2015.19 To comply with the PNE’s mandate that ICE research nonconventional renewable energy resources, the planning department did write the “Development Plan of New Sources of Generation, Renewable and Non-Conventional.” This document presents a perfunctory analysis of renewable energy exploitation in Costa Rica, though again, it refers to 15- to 20-year-old studies of resource potential.

Interinstitutional Cooperation Related to Hydro-Project Boruca Figure 3.3 illustrates institutional surroundings and the incorporation of governmental institutions in the development of the hydroelectric project, such as: z z z z z z

University of Costa Rica (UCR) Ministry of Agriculture and Cattle Ranching (MAG) Ministry of Development and Planning (MIDEPLAN) Ministry of Public Works and Transportation (MOPT) National Institute for Learning (INA) National Environmental and Technical Secretariat (SETENA) and other governmental and nongovernmental institutions (NGOs).

Figure 3.3 also indicates the population characteristics of the area affected by the project, including the flow of information by the sharing in meetings and coexisting with the communities, and also based on the constant maintaining of written communication, and in the chronological unfolding of the atmosphere.

Communication, Trust, and Coordination within the Electricity Sector There exists significant disconnection and lack of communication within the ICE itself between the strategic planning, operational planning, and research and development components. For example, members of ICE’s alternative energy research and development division had not been informed of “Planning’s Development Plan of New Sources of Generation, Renewable and Non-Conventional” for more than two years after its

Analysis: Hydro-Project Boruca, Costa Rica

45

BORUCA PROJECT

COORDINATION OF STATE ENTITIES – ICE – Private Sector

UCR

IDA

Ministerio de Turismo

MIDE PLAN

MAG

CNP

Ministerio de Salud

ICT

CCSS

MOPT

INA

Legislative Power

SETENA

MINAE

INVU

CONAI

Legal Standard ‘Sala IV’

Defensor de los Habitantes

INFORMATION FEEDBACK

MEETINGS

HORIZONTAL & VERTICAL RELATIONSHIP

MEETINGS

INDIGENOUS PEOPLES

LOCAL GOVERNMENTS

ASSOCIATIONS/ NGO’S

ENVIRONMENTAL GROUPS

COMMUNITIES

METHODS OF COMMUNICATION

Source: ICE, 2002, altered

Figure 3.3 PH Boruca Project

completion. Moreover, when the planning department developed the concept, it appeared that the PEG did not consult “Research and Development.” It seems that there is no formal method of communication or consultation among the departments. There is also an obvious lack of coordination between ICE and MINAE apparent in the incongruencies between the PEG and the PNE. Moreover,

46

CONFLICT RESOLUTION OF BORUCA ENERGY PROJECT

members of MINAE complained that when the PNE is discussed, ICE sends the head of planning as their representative, an officer three steps down the management hierarchy from the president of ICE, whereas all the other ministries are represented by the respective chief executives themselves. Members of MINAE feel that this is an example of ICE’s dismissal of the PNE and the authority of MINAE. There is also distrust between the private and public sectors. Private industries complain that ICE and ARESEP are against private companies, making private industry less willing to work with them. ARESEP claims that this accusation is not true and that private industries create problems because they refuse to reveal all of their costs as required by law. Finally, some employees within ICE believe private companies are paid too much for electricity production. Whereas, the private sector, according to ACOPE, believes that they are not paid enough for the investment risks that they take. Recently a working group assigned to advise the legislature on the new modernization and strengthening of ICE law has been disbanded because it was “gridlocked.” Instead the legislature will form a commission made up solely of “diputados.” The announcement has set off a new set of protests and strikes by ICE’s labor union.20

Planning Tools The computer modeling system used by ICE’s planning department for determining least cost generation scenarios can only handle hydrological and fossil fuel thermal plant variables, which obviously limits the amount of planning for alternatives. Moreover, the cost analysis equations used by ICE are limited. They do not include any environmental or social externalities, or factors for risk and volatility. Though this fact signals a greater failing in the field of resource economics and electricity planning, ICE could research with more comprehensive cost analysis tools. Finally, the PEG’s quoted fossil fuel projections as earlier noted are less than half the actual prices.21

Funding Mechanisms ICE is currently facing serious funding challenges. The Costa Rican legislature requires ICE to use an accounting method such that its books are always balanced. In this system, the government claims any yearly profits, while at the same time investments in new plants are considered

Analysis: Hydro-Project Boruca, Costa Rica

47

expenses and must be paid for by present income. This is an inappropriate accounting system because electrical plants, especially capital-intensive renewable energy plants, need many years to recuperate investment costs. Most electricity companies run with a 70 percent debt because of plant investments. The funding limitations force ICE to prioritize activities in the following way: z z z

Operation and maintenance of present system; Expansion of generation in the cheapest possible way; Research and development of new technologies.

Research and development thus gets short changed. Because ICE has experience and capability with hydroelectricity, and, because fossil fuel plants are cheap to construct, these are the options they follow. Alternative energy gets left relatively behind.

Human Rights International human rights conventions, treaties, and declarations apply to indigenous peoples, as they are intended to protect and promote the rights of all people. The International Covenant on Civil and Political Rights (ICCPR)22; The International Covenant on Economic, Social and Cultural Rights (ICESCR)23; The American Convention on Human Rights24; The San Salvador Protocol to the American Convention on Human Rights25; Charter of the United Nations26; and the Universal Declaration of Human Rights27 can therefore all be applied to indigenous peoples. There are also regional documents which apply to indigenous peoples. Two of the many important declarations relevant to this project will be used in this analysis—(1) the Declaration on the Right to Development and (2) the Declaration on the Rights of Indigenous Peoples. The Declaration on the Right to Development28 provides that the right to development is universal and inalienable, in that all persons have the right to participate in, contribute to, and enjoy economic, social, cultural, and political development. The Declaration on the Rights of Indigenous Peoples, recently adopted by the General Assembly at its sixty-first session on September 13, 2007, sends a powerful message to the international community. Most state representatives support the declaration in which 143 states voted in favor,

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while 11 abstained. New Zealand, the United States, Canada, and Australia voted against. The ILO Convention No 169 concerning Indigenous and Tribal Peoples in independent countries29 is one of the most important enforceable laws relating to indigenous peoples. These laws all protect the rights of indigenous peoples living in the Boruca Dam Project area. Other international instruments, of course, may also apply. Domestic law in Costa Rica will also be used to analyze the human rights situation of indigenous peoples in light of the Boruca Dam Project. In the previous section, these laws were touched upon and will be discussed here again to demonstrate the human rights violations that could occur with the implementation of the Boruca Dam. It should be noted that not all indigenous peoples are opposed to the creation of the dam. Some are hoping it will bring economic prosperity and a way out of poverty; most, however, are opposed to project.

International Law and Human Rights First and foremost, the indigenous peoples were not originally consulted or properly informed of the Boruca Dam plans and the affect it will have on them and their life. Only superficial information has been given; they cannot access more detailed information, and in fact are being prevented from accessing this information.30 Without being properly informed, the indigenous peoples clearly cannot grant informed consent. Some accounts show that some have not even received official government information stating that they might have to move.31 Furthermore, the peoples being displaced due to the dam are claiming that they never agreed to abandon their lands, as ICE claims. These people believe that ICE must have used attendance sheets from other meetings to prove the majority agreement by the indigenous peoples to leave the land.32 The fear and uncertainty of the future of the indigenous peoples, in and of itself, is quite cruel, especially considering they were not involved in much of the 30-year planning process, even though they would be greatly affected by its potential implementation. The affects on culture, traditions, and historical sites and artifacts could be devastating and would greatly affect the lives of these peoples. The violations that could result from the Boruca Dam are numerous and range from development rights and property rights to cultural and economic rights.

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The Right to Development Before planning and implementing development projects or projects that affect indigenous peoples, studies should be carried out, as stated in Article 7(3) of the ILO Convention No 169. “Governments shall ensure that, whenever appropriate, studies are carried out, in co-operation with the peoples concerned, to assess the social, spiritual, cultural and environmental impact on them of planned development activities. The results of these studies shall be considered as fundamental criteria for the implementation of these activities.”33 No studies on the social impacts of the dam have been made public. In fact, studies that have been done relating to the environmental impact have also not yet been made available. More likely than not, these studies are hiding unfavorable information, which could delay or halt the project. The obligation to carry out these studies and provide information is essential, as free and informed consent cannot be achieved without it. Studies on the impact and affects of the dam are the only way to get this freely informed consent. Article 1 of the Declaration on the Right to Development states that “the right to development is an inalienable human right by virtue of which every human person and all peoples are entitled to participate in, contribute to, and enjoy economic, social, cultural and political development, in which all human rights and fundamental freedoms can be fully realized.””34 The right to development includes sovereignty over natural resources, self-determination, popular participation in development, and the creation of favorable conditions for the enjoyment of other civil, political, economic, social, and cultural rights, among others. The Declaration on the Right to Development states that the right to development can be both an individual and a collective right. It requires that the state ensures equal and adequate access to resources and that the international community promotes fair development policies and requires constant improvement. Article 30 of the UN Declaration on the Rights of Indigenous Peoples states that indigenous peoples have the right to determine and develop priorities and strategies for the development or use of their lands, territories, or other resources. It also reveals the importance of indigenous peoples determining and developing projects on traditional land stating that “indigenous peoples have the right to determine and develop priorities and strategies for the development or use of their lands, territories and other resources, including the right to require that states obtain their free

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and informed consent prior to the approval of any project affecting their lands, territories and other resources, particularly in connection with the development, utilization or exploitation of mineral, water or other resources. Pursuant to agreements with the indigenous peoples concerned, just and fair compensation shall be provided for any such activities and measures taken to mitigate adverse environmental, economic, social, cultural or spiritual impact.”35 Again, it is obvious that these guidelines were not followed by the government (more specifically, ICE) and the rights of the indigenous peoples were overlooked. The Declaration on the Rights of Indigenous Peoples further adds, in Article 23, that “indigenous peoples have the right to determine and develop priorities and strategies for exercising their right to development. In particular, indigenous peoples have the right to determine and develop all health, housing and other economic and social programs affecting them and, as far as possible, to administer such programs through their own institutions.”36 With relocation a threat, these rights may not be achievable. Article 7 of the ILO Convention No. 169 states that “the Peoples concerned shall have the right to decide their own priorities for the process of development as it affects their lives, beliefs, institutions and spiritual well-being and the lands they occupy or otherwise use, and to exercise control, to the extent possible, over their own economic, social and cultural development. In addition, they shall participate in the formulation, implementation, and evaluation of plans and programs for national and regional development which may affect them directly.”37 The Declaration on the Rights of Indigenous Peoples reiterates the importance of the indigenous peoples being involved in processes that affect them, if they wish. “Indigenous peoples have the right to participate fully, if they so choose, at all levels of decision-making in matters which may affect their rights, lives and destinies through representatives chosen by themselves in accordance with their own procedures as well as to maintain and develop their own indigenous decision-making institutions.”38 The consultation procedures should take account of indigenous and tribal peoples’ traditional methods of decision-making. The parties involved should seek to establish a dialogue allowing them to find appropriate solutions in an atmosphere of mutual respect and full participation. As mentioned, the people of the Boruca region were ill-informed and did not participate in the formulation of plans to develop the Boruca Dam; some indigenous peoples say that participation has been limited throughout. Clearly, they were not granted the right to impact the decision-making

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process for development on their lands; development which does affect their lives, beliefs, institutions, spiritual well-being, and the land which they occupy. This is also true considering the opposition of many to the Boruca Dam Project. The right to development is infringed when development takes place without their free and informed consent; development is generally imposed from outside forces, it generally damages land, historical sites, and natural resources. Indigenous peoples must be consulted during the early stages of conceptualization and planning. They should be presented with a completed plan and given ample time for discussion within their communities. If objections result, UNDP, for example, halts the implementation of projects until “points of difference or misunderstanding could be clarified.”39 Of course, development can have positive aspects for indigenous peoples, when they are included in the process, their cultural and other rights are protected, and they have given free and informed consent. Development, however, has often caused problems for indigenous communities, resulting in displacement, loss of livelihood, destruction of local environments, damage to sacred sites, and intrusion of outsiders. Indigenous peoples must be included as stakeholders, beneficiaries, and full participants when possible, in the design, implementation, and evaluation of projects. Free, informed, and prior consent coupled with selfdetermination of indigenous communities needs to be considered when planning development projects. To protect indigenous human rights, they must participate as free and equal partners, and citizens in processes that affect their future and survival.40

Rights Related to Resettlement and Land Article 8(2) of the Declaration on the Rights of Indigenous Peoples states that the “prevention of and redress for (b) any action which has the aim of effect of dispossessing them of their lands, territories or resources;” and (c) “any form of population transfer which has the aim or effect of violating or undermining any of their rights.”41 The Boruca Dam will dispossess them of their lands and resources, and will have the affect of violating human rights. Article 10 of the Declaration on the Rights of Indigenous Peoples states that “[i]ndigenous peoples shall not be forced from their lands or territories. No relocation shall take place without the free and informed consent

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of the indigenous peoples concerned and after agreement on just and fair compensation and, where possible, with the option of return.”42 Article 16 of the ILO Convention No. 169 states that “the peoples concerned shall not be removed from the lands which they occupy.”43 Article 18 further states that “adequate penalties shall be established by law for unauthorized intrusion upon, or use of, the lands of the peoples concerned, and governments shall take measures to prevent such offenses.”44 The indigenous peoples in the Boruca area, as previously mentioned, do not feel that they were well informed of the dam project; they do not feel they have consented to relocation nor do they feel they have been adequately compensated as they are tied to the earth and no price can replace historical and archeological sites.45 The Boruca Dam would require the resettlement of at least 3,000 inhabitants, many of whom are indigenous peoples. Resettlement would most likely involve resettling indigenous peoples to lands and homes that are nontraditional and do not respect their cultures, values, traditions, or way of life. It is likely that relocation will be on smaller lots, with urban nontraditional architecture, and in concentrated areas. According to CEDIN (2002),46 resettlement projects usually contradict the design—social, cultural, and traditional—aspects of indigenous peoples, causing a break in solidarity of indigenous peoples. Not only will human rights be violated, but the potential for the continuation of violations exists as well. The fact that resettlement sites most likely will not respect the indigenous peoples’ cultures and religions should be mentioned as well as the fact that relocation should only be an option after free and informed consent (which was not obtained). Articles 7 and 10 of the Declaration on the Rights of Indigenous Peoples, among other documents, firmly states that relocation should be avoided. The cultural and religious aspects are also important in this analysis, rights that are also protected under the ICESCR. Another basis for arguing that the indigenous peoples should not be forcibly removed from lands is that the lands are identified as reserves and protected by Costa Rican laws (discussed further on). It is imperative to pay special attention to relocation because it may undermine other rights. It is also important because assimilation and/or integration into other cultures or people may impose a way of life, which indigenous peoples are unaccustomed to, or unwilling to live. Without free and prior informed consent, forced assimilation is in violation of human rights. Article 8 (1) of the Declaration on the Rights of Indigenous Peoples states that “[i]ndigenous peoples and individuals have the right not to be

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subjected to forced assimilation or destruction of their culture.”47 Aforementioned, this right may be violated if relocation occurs, especially if the relocation does not take into consideration cultural, religious, and traditional beliefs and way of life. It is also important to note that although indigenous reserves are protected in Costa Rica, 80 percent of the land is owned by nonindigenous peoples.48 In Boruca, only 54 percent of land is still owned by indigenous peoples and in Térraba this number falls to 15 percent.49By 2004, 88 percent of the land in Térraba was possessed by nonindigenous people. The government, according to Coto,50 does not support attempts to defend these territories, even though they legally have the obligation to free this land for indigenous peoples. One of the most obvious violations of the indigenous peoples in development and dam projects relates to the loss of land. The right to land is not a justiciable human right as it has not been included in any of the justiciable international law treaties or conventions. It has been included in conventions that are binding and justiciable nationally rather than internationally. This right, has however, been argued through the use of other justiciable human rights, such as the right to property, the right to selfdetermination, and the cultural rights of minorities. The loss of land is very problematic for indigenous peoples and it is an important and vital resource for these communities; it can produce food and related employment, be used for housing, and has ties to cultural and traditional life. The cultural and traditional importance of land in the Boruca case can be strengthened because of the archeological deposits and important pre-Colombian settlements.51 In most cases, no amount of compensation can replace the loss of ancestral and archeological sites and the value of the cultural attachment.

Property Rights The right to property does not only protect the rights of those who own land but also implies the need to ensure land for those who do not possess or own land, those who do not have enough land, and those who have land, but cannot claim ownership, such as indigenous peoples.52 Because of the controversial nature of this right and the difficulty in gaining consensus on this right, it was neither codified in the International Covenant on Civil and Political Rights (ICCPR) or the ICESCR. The right to property established in the American Convention has led to a major development in land rights history. In the August 31, 2001 judgment of the Inter-American Court of Human Rights (IAHCR), in the

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case of Mayagna (Sumo) Awas Tingni Community v Nicaragua53, the (IACHR) determined through the right to property, Article 21, that Nicaragua was in violation of the previously stated right because of the lack of acknowledgement of this indigenous groups’ land, and the obligations to protect the land. Nicaragua violated the obligation to protect the land by allowing a private company to exploit the forest. The state of Nicaragua treated this land as state property, and therefore felt they were not in violation. Nicaragua was ordered by the IACHR to effectively delimit, demarcate, and title the land of this group and other indigenous communities based on their customs, traditions, and need.54 This was a very important case and a landmark decision in the interAmerican system and for global human rights systems. This case determined the connection between the right to property and the right to land and natural resources for economic and other means. This case was a monumental step forward for indigenous rights and land claims. The right to property appears in Article 17 of the Universal Declaration of Human Rights (UDHR). Unfortunately, the UDHR is not a legally enforceable instrument, although it is considered customary international law.55 The right to property has, however, been included in regional instruments, such as the American Convention on Human Rights (1969) (Article 21), and the European Convention on Human Rights (1950) (Article 1). Costa Rica ratified the American Convention on Human Rights on March 2, 1970 and the San Salvador Protocol on September 29, 1999. The San Salvador Protocol includes economic, social, and cultural rights, as similarly outlined in the ICESCR. In regards to the Boruca Dam case, one can deduce that the Costa Rican government may be in violation of this right as well, as the development process would have been implemented without free and informed consent, not to mention the disregard for their domestic laws. The right to property applies to the Boruca case, as these lands are identified and protected by Costa Rican law; Indigenous Law No. 6172 of 1977 states that these peoples are living on lands deemed reserves and protected by law. There is no just compensation, and to date, no relocation, and resettlement offered. Any relocation would, more likely than not, oppose their beliefs, traditions, values, and way of life. Furthermore, property should only be deprived for reasons of public utility or social interest, and although electricity may fall into this category, it should be in the best interest of the society it affects, Costa Rica, and this is questionable. Although an argument in favor of the greater interests for Costa Rica and Costa Ricans is valid, it should not conflict with the rights of individuals

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or indigenous peoples. President Miguel Angel Rodriguez stated that the project was aimed at providing Mexico and the United States with cheap energy. The project would also benefit energy transnationals as ICE would seek “strategic alliances with large foreign companies” to finance the project.56 However, it has also been said that the dam was to provide energy for Costa Rica and some Central American countries, which changed to Mexico and some South American countries.57 Either way, it is not only to support the needs of the Costa Ricans. Arguably, the rights of indigenous peoples of Costa Rica should not be put behind the economic interests of this state. It appears, however, that this is the case.

The Right to Self-Determination The right to self-determination appears in common Article 1, meaning it is identical in both the ICCPR and the ICESCR. The right to self-determination ensures the ability of people to pursue economic, social, and cultural development and their right not be deprived of their means of survival.58 Common Article 1 (1) of these two covenants states that “all peoples have the right of self-determination. By virtue of that right they freely determine their political status and freely pursue their economic, social and cultural development.”59 Article 1 (2) states that “all peoples may, for their own ends, freely dispose of their natural wealth and resources without prejudice to any obligations arising out of international economic co-operation, based upon the principle of mutual benefit, and international law. In no case may a people be deprived of its own means of subsistence.”60 Article 3 of the Declaration on the Rights of Indigenous Peoples also includes this important right. Article 3 states “[i]ndigenous peoples have the right to self-determination. By virtue of that right they freely determine their political status and freely pursue their economic, social and cultural development.”61 Article 4 continues by stating that “[i]ndigenous peoples, in exercising their right to self-determination, have the right to autonomy or self-government in matters relating to their internal and local affairs, as well as ways and means for financing their autonomous functions.”62 Article 5 also pertains to this right, stating that “[i]ndigenous peoples have the right to maintain and strengthen their distinct political, legal, economic, social and cultural institutions, while retaining their right to participate fully, if they so choose, in the political, economic, social and cultural life of the State.”63

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In Costa Rican domestic law, Indigenous Law No. 6172 of 1977, the right to self-determination is also guaranteed. Self-determination is important because it recognizes indigenous peoples as “peoples,” meaning they can freely determine their economic, social, and cultural development as “peoples” rather than being dependent on the state’s power. States therefore have to negotiate with them as a collective group with rights. This right also implies equality, as they are granted the same rights as all people.64 The UN Charter Article 1 (2) states goals “to develop friendly relations among nations based on respect for the principle of equal rights and self-determination of peoples, and to take other appropriate measures to strengthen universal peace (1945).” Most importantly, the right to self-determination provides for the ability of indigenous people to choose their framework for economic, social, and cultural development and to enjoy the advantages that stem from their natural resources and their close relationship with the land. This shows the link between land, self-determination, and subsistence.65 In a statement made by Erica-Irene Daes before the Second Session of the Permanent Forum on Indigenous Issues, she states that sovereignty of natural resources should be applied to indigenous peoples because, among other reasons, “[i]ndigenous peoples have a right to development and actively to participate in the realization of this right; sovereignty over their natural resources is an essential prerequisite for this; and that “the natural resources originally belonged to the indigenous peoples concerned and were not freely and fairly given up.”66

Economic, Social, and Cultural Rights Economic, social, and cultural rights will only briefly be discussed, as it is hoped that these violations have or will become obvious through reading this book. These rights are currently being violated, and would be worsened by the creation of the Boruca Dam. Article 23 of the ILO Convention highlights the importance of indigenous arts, hunting, fishing, and gathering as important for the maintenance and development of the peoples. Article 23 states “handicrafts, rural and community-based industries, and subsistence economy and traditional activities of the peoples concerned, such as hunting, fishing, trapping and gathering, shall be recognized as important factors in the maintenance of their cultures and in their economic self-reliance and development. Governments shall, with the participation of these peoples and whenever

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appropriate, ensure that these activities are strengthened and promoted.”67 With the replication of indigenous art, it is clear this violation exists within the community. Given the living conditions and standards of these reserves; it is clear violations exist and, with the implementation of a dam, would be worsened. The indigenous communities are among the poorest segments of Costa Rica. There are high-levels of unemployment or underemployment as will be discussed in other sections. The deterioration of job creation is grave, and the dam would only promise to create short-term employment. It seems that numerous economic, social, and cultural rights are in violation based on the situations of the indigenous peoples in the Boruca region. Although mentioned elsewhere in this book, it is important to note that these conditions are violations of human rights. Many of these rights were not ensured before and during the planning of the Boruca dam project; furthermore some of these rights would presumably be violated as a result of the dam. Current and potential violations are outlined in the ICESCR. Among the violations listed in various areas are a lack of electricity and bridges, education and schools, aqueducts, health services, public transportation, telephones, sewage systems, housing, potable water, and development. These regions are also plagued with bad roads, unemployment, pollution, river contamination, alcoholism and domestic violence, loss of lands, deforestation, illiteracy, migration, soil erosion, illegal hunting, and extraction of flora. Loss of grounds and fires, are also among the many problems in the indigenous areas. Some of these problems exist in many of the communities. In relation to the previously mentioned rights outlined in the ICESCR, it appears that numerous human rights violations existed, and continue to exist in the indigenous populations. Considering the right to development and self-determination, these rights broken under the guise of the economic, social, and cultural rights of the broader population, also hinder the future accessibility to these rights for the indigenous people. The Boruca Dam Project would lessen their freedom to achieve the right to development in order to obtain these economic, social, and cultural rights, and hinder the right to self-determination in regards to their ability to determine their economic, social, and cultural development. The civil, political, economic, social and cultural rights of Costa Rican indigenous peoples, historically and currently, have been violated. These rights continue to be violated, but with the implementation of the Boruca Dam, these violations will continue to plague these peoples and be made worse, or at the very least, will improve.

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Environmental Rights for Peoples Clearly numerous environmental rights, treaties, and laws could be broken through development projects. It is and will become clear through the Boruca Dam analysis presented here that much damage could be done if the dam is constructed. The damage to the environment itself is clear, as are the larger impacts to society. Human rights to a healthy and clean environment exist. In regards to indigenous peoples, there are rights based on the environment because of their close attachment to the land and basic survival. The ILO Convention No 169 recognizes the need for the natural resources, relied upon by the indigenous peoples, to be protected. In Article 15 (1) it states that “the rights of the peoples concerned to the natural resources pertaining to their lands shall be specially safeguarded. These rights include the right of these peoples to participate in the use, management and conservation of these resources.”68 Furthermore Article 15 (2) of the ILO Convention states that “in cases in which the state retains the ownership of mineral or sub-surface resources or rights to other resources pertaining to lands, governments shall establish or maintain procedures through which they shall consult these peoples, with a view to ascertaining whether and to what degree their interests would be prejudiced, before undertaking or permitting any programs for the exploration or exploitation of such resources pertaining to their lands. The peoples concerned shall wherever possible participate in the benefits of such activities, and shall receive fair compensation for any damages which they may sustain as a result of such activities.”69 The natural resources of the lands in which indigenous peoples live are also protected in international law. ILO Convention No 169 Article 7 (4) states that governments need to “. . . take measures, in co-operation with the peoples concerned, to protect and preserve the environment of the territories they inhabit.”70 Article 4 (1) of the ILO Convention No 169 states that “special measures shall be adopted as appropriate for safeguarding the persons, institutions, property, labour, cultures and environment of the peoples concerned. (2) Such special measures shall not be contrary to the freely-expressed wishes of the peoples concerned.”71 The right to a healthy environment is outlined in Article 11 of the San Salvador Protocol. Article 28 of the Declaration on the Rights of Indigenous Peoples states that “[i]ndigenous peoples have the right to the conservation, restoration and protection of the total environment and

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production capacity of their lands, territories and resources, as well as to the assistance for this purpose from states and through international cooperation. . . .”72 The environment will certainly be affected by the continuation of the Boruca Dam Project, and will affect the well-being and livelihood of the indigenous peoples. Although some areas have been protected by the government, some of the lands that the indigenous peoples inhabit have not been protected or preserved, as they should. Clearly, if a dam is constructed, it will impact and alter the environment, affecting the indigenous peoples. In regards to indigenous cultures this importance is amplified, as there is the important connection to the land, historical sites, and the history of the people. A healthy environment means food, shelter, employment, health, and survival. With diseases, earthquakes, loss of habitat and species, pollution etc., the environment is not only at risk, but so are the lives of the indigenous peoples. The environmental impact of the dam will not be clear until finished, but considering the consequences of other dams, one can assume.

National Laws and Human Rights Violations The Costa Rican government has put into legislation many protections for the indigenous peoples of its country, protecting their land and cultures. Unfortunately, these laws have not always been upheld by the government. Indigenous Law 6172 of 1977 recognizes the distinct identity of the indigenous peoples, their right to self-determination, and the protection of their culture, possessions and land. Article 2 recognizes the reserves granted to indigenous peoples; lands that are inalienable according to Article 3. If these lands are to be invaded by nonindigenous peoples, authorities must remove these people from the reserves (Article 5). Only indigenous peoples can build homes, destroy trees, control timber resources, and plant crops, according to Article 6. Furthermore, the forest lands within the reserves must remain forested. Domestic laws in Costa Rica relating to indigenous rights are somewhat progressive in theory. Article 1 states that reservations can only be diminished by the adoption of a law to explicitly do so. The government to date, however, has decreased four reserves, through decrees. Article 2 of the Indigenous Law of 1977 states that the transfer of land from nonindigenous peoples to indigenous peoples will be free of charge, because CONAI is obligated to purchase the land on behalf of the

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indigenous peoples. CONAI, however, is not adequately funded; consequently, indigenous peoples do not have much of the land they are entitled to. But one of the gravest problems is exactly that, the nonindigenous occupation of indigenous lands, a problem recognized by the government and essentially ignored. The removal of these people with compensation has not been enforced. On some reservations, more than 80 percent of the territory is occupied by nonindigenous peoples.73 Costa Rica is again violating one of its laws, and its obligation under international law, ILO Convention No 169, Article 18, which states that “adequate penalties shall be established by law for unauthorized intrusion upon, or use of, the lands of the peoples concerned, and governments shall take measures to prevent such offences.” In this instance, the government is ignoring the intrusion. Article 7 of the Costa Rican Constitution declares international treaties and conventions ratified by Costa Rica of higher authority than national law. Therefore international law must be recognized by national legislation.

Conclusion Numerous human rights violations are occurring to the indigenous peoples in the Boruca region. These human rights would be further violated by the Boruca Dam project, if constructed, and other human rights violations may also occur. Human rights and laws outlined and enshrined in both international and national legal instruments have, and would further, be violated. This analysis was done to show the numerous violations of the Costa Rican government and potential violations as a result of the dam. In court and with human rights commissions, much more evidence would be needed to make the case. Numerous other human rights are and could be violated; however, this is not an in-depth analysis of the human rights situation in Costa Rica. Economic, social, and cultural rights of indigenous peoples do warrant an in-depth analysis; however, these should be apparent through the other sections of this book. Although land is of utmost importance to indigenous peoples for their cultural survival and subsistence, the natural resources from the land are equally important, as they are intrinsically linked to the land, culture, food, survival, livelihood, employment of the indigenous peoples, and also linked to the environment. In a time when environmental degradation is grave, it is important to note these violations, as for indigenous peoples, violations to the environment means violations that affect them, their livelihood, food, culture etc.

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The construction of the Boruca Dam would clearly include numerous violations to the indigenous peoples. The importance of land for survival, culture, and history is unquantifiable. With their relocation, loss of land, and development on their land, the indigenous peoples will face grave problems. For these reasons, and the huge environmental impact the dam will have, the construction of the dam and the proposal created should be reevaluated to take into account these considerations and the human and environmental damage that will occur and has occurred as a result of the project. Thankfully the government is in the process of planning a smaller project, Project El Diquís, to decrease some of the negative effects that could have occurred as a result of the larger dam project. Furthermore, the Boruca say, “Did the emissaries of power think that the ‘docile Indians’ would be willing to leave the bones of our ancestors, our plantations and our humble homes? They underestimated us because they did not know us (and they still do not know us) because the god that inspires them has made them overbearing. The spirit of all our ancestors, the mountains and the river, the air and the landscape has no price. They have not realized yet that there are things that money and manipulation cannot buy. But they live and breathe for the god of money, they cannot understand. That is why they treat us this way.”74

Stakeholders The WCD reports, “dams fundamentally alter rivers and the use of natural resources, frequently entailing a reallocation of benefits from local riparian users to new groups of beneficiaries at a regional or national level.”75 Costa Rica is a country located in Central America that currently provides 94.9 percent electricity to its population.76 With an estimated 4 million residents in the entire country, an estimated 200,000 people do not have access to electricity. The majority of the remaining 5 percent are located in the southern region, mainly composed of different indigenous communities. With a price tag of over $1 billion, the Boruca Dam will generate 1,500 MW of power meeting the current demand and selling its surplus to its neighboring countries. This dam will be constructed 260 meters high and flood 25,000 hectares of land, 50 miles of the InterAmerican Highway, and will affect five communities in the Boruca area of Buenos Aires; there are 12,470 members of this community.77 It will damage more than 1,000 farms and 350 local businesses will be under water. The dam will bring many ecological and economic benefits to Costa Rica, but will completely erase the ancestral ties, history, and spirituality

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of the indigenous population. One remarked, “Our lands would signify death for us, the end of our story.”78 Hydroelectric power is the new renewable energy source that currently provides 19 percent of electricity generated throughout the world.79 With over 40,000 indigenous people (1.2 percent of the population), the WCD stakeholder analysis is the best analysis to promote multistakeholder dialogue. The WCD multistakeholder dialogue will be used as a component of the mediation framework produced below. If the government can meet the needs of the parties, acceptance can be achieved, social capital built, and any potential conflict in this project can end. The government of Costa Rica is facing a difficult issue to plan out the construction of this dam as it would negatively affect the indigenous communities of Boruca and Curré. The WCD reports that the sustainability of dams needs proper engineering and environmental, social, economic, and financial considerations. The approach of construction needs to encompass stakeholder interests and acknowledge areas of potential conflicts.80 The final decision to build or not build a dam emerges from a participatory assessment of policy, institutional, and technical options. It is only when the screening of all options is undertaken that the most appropriate assessment of the dam project can be made. In fact, stakeholder participation is paramount to the decision-making processes of the planning and management of all dam activities.81 Literature has provided definitions of stakeholder participation as stakeholder influence in decisions. In this chapter, the stakeholder participation will discuss the stakeholder analysis, participation plans, techniques and tools, financing, and timing. Following the analysis provided by the WCD, the dam project will engage potential stakeholders early enough allowing sufficient time for participation. The analysis of stakeholder participation will address all outstanding social issues to increase public acceptance. Under proper assessment, Costa Rica can measure an effective compensation policy for those affected by the Boruca Dam Project, if compensation were to be accepted. The field research team from Arcadia University, United States that visited Costa Rica in 2007 had the opportunity to discuss the dam development issues with leading personalities in the country. Discussions revealed the immense construction boom in Costa Rica and the supply of money being poured into the economy of Costa Rica by local banks. One of the construction projects is the Boruca Dam Project that was met with a lot of resistance from the local indigenous communities and the international arena. This resistance has made it harder for ICE to evict the indigenous people from their reservations.

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Some argue that the dam is needed to meet the demands of Costa Rica. Recently, Costa Rica experienced rolling blackouts because the country could not meet the excessive demand of the consumers using electricity. This has hurt the infrastructure of the country. There was some discussion on the privatization of ICE, but ICE has gained the respect of 95 percent of the population of and the people do not want it privatized. However, privatizing electricity will be cheaper for the consumer because they would only have to pay 2 cents per kilowatt while now they pay 5 cents per kilowatt. Also, if the consumers begin purchasing their electricity from private companies, it will restrict ICE from functioning properly. In order to meet the demands of the country, a dam that would potentially improve the economy and ecological tourism of Costa Rica needs to be built. The surplus electricity will be provided to the Central American grid, thereby improving the economy, tourism, and way of life for Costa Ricans. Costa Rica depends on the environment and its tourist attractions. The surplus electricity can help boost the economy. For the first five years of the existence of the Boruca Dam, it will export electricity to Nicaragua, Mexico, and meet the increase of demand of 6 to 8 percent per year in Costa Rica. After five years, it will stop exporting electricity and begin providing power solely to its population because it will no longer have a surplus. After five years, if it is only meeting the demands of the country, ICE could perhaps build another dam. The export of electricity will foster regional development that will provide jobs building roads, the Boruca International Airport, and more projects that will provide job security to the indigenous people. Currently, the Arenal and Corobici Dams are not being used to their full potential. Only four of the six generators are being used at each plant. It would be cost effective to buy the generators from Mexico at a rate of $118 million. These generators will be faster and cheaper than proceeding with the ICE route and building a new dam. These generators are powered by fossil fuels that are 90 to 95 percent renewable energy. The renewable energy resources used in Costa Rica are geothermal, wind, hydroelectric, and ethanol. Although the dam could provide exceptional outcomes to the Costa Rican economy, ICE does not have an acceptable approach. Excluding the indigenous community from this dialogue will not address the environmental concerns; rather it will pose threats to the indigenous way of life and create greater resistance. The common practice is that the indigenous community has been disregarded and prejudiced. The Costa Rican prejudice has ignited serious international debates on the indigenous issues. There will be serious

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ecological impacts with the dam changing the flow of the river. It will change the size of the lake pushing for another dam to equalize the flow of the water and meeting the demands of higher volume of rainfall. This will result in further resistance and require the construction of a canal or tunnel. Currently, the land of the indigenous population is under communal ownership. The public is increasing its resistance to ICE, rather than participating in a dialogue with them. The dam is planned for the southern area of Costa Rica where the population is composed mostly of indigenous peoples. The location of the dam depends on solar energy, wind, geothermic energy, and rain. Another area heavily influenced by rain is in the southeastern region, which is also populated by mostly indigenous peoples. The stakeholder analysis and assessment of the Boruca Dam Project is using a mediation framework. Mediation is a form of negotiation with an impartial facilitator. Decisions can only be vindicated by the primary participants in the mediation process. Through unanimous consensus an agreement can be reached. Consensus entails an important component of identification of the interests of the parties. Through the identification process, the parties can hope to maximize the best solution. The mediation framework incorporates the positions, interests, and needs of the parties and determines whether they were met within the agreement. The positions are our stances on an issue; the interests are what we want to achieve from our positions; the needs are all nonnegotiable entities needed to achieve the interests. The impartial facilitator, otherwise known as the mediator, must come into a conflict understanding the background of the case and address the concerns of the parties. The mediator has a challenging role as they must understand the interests of both parties and to address their needs. But, it is only through cooperation and the understanding of the other party’s solutions that parties can reach a mutual consensus and address their nonnegotiable entities. The project involves a variety of stakeholders, some of whom would be more impacted by the completion of the project than others. The primary actors in the conflict include ICE, the indigenous communities of Rey Curré , Térraba , and Boruca, the International Ombudsman Centre for the Environment and Development (OmCED), and the Asociación de Desarrollo Integral (ADI), the “indigenous associations.” Other actors include the indigenous communities of Ujarráz, Salitre, and Cabagra, the nonindigenous peoples living in indigenous reserves, the International Development Bank (IDP), CONAI, and Federacion Costarricense para la

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Conservacion del Ambiente (FECON), and potential international funding agencies. Secondary actors in the national electricity sector include: (1) industry organizations such as ACOPE, the Costa Rican association of private energy producers; (2) LAICA, a sugar industry organization; (3)environmental groups, such as Aprefloflas; (4) university departments that work on energy research, including the National University’s Solar Research Lab; (5) the press, particularly La Nacion, a daily newspaper; and (6) and civil society, including unions and university students, as well as consumers. Over the past five years, there has been tremendous civil society response to electricity policy. In 2002, protesters brought the nation’s capital to a standstill over the proposed reorganization and privatization of ICE. In response to these protests, in 2003, the government created the Special Mixed Commission for the Strengthening and Modernization of ICE, with representatives from all of these actors, whose mandate is to study, analyze, and give recommendations on an impending ICE reform law. In August 2005, the legislature disbanded the commission, claiming internal gridlock prevented it from accomplishing its mandate and that instead a new commission will be formed consisting solely of legislators. This is an unfortunate decision by the government as all of these stakeholders should and will have a voice in any strategic energy planning process, whether in a commission or on the streets. The following groups are some of the numerous stakeholders directly or indirectly involved in the Boruca Dam Project. These stakeholders have positions, interests, and needs that should have been assessed during the planning of the Boruca Project Dam.

Boruca Hydroelectric Dam Project Stakeholder Participation Boruca Indigenous Community Since 1939, the government of Costa Rica provided the indigenous communities protected territory, land ownership, and autonomy. Since then, there have been numerous international laws such as ILO 169 that granted privileges to the indigenous community and their lands, providing prior consultation with the indigenous community before action. The Indigenous Act of 1977 stated that indigenous reserves are unalienable and nontransferable and are made exclusively for the indigenous inhabitants. Recently, the Constitutional Assembly publicly announced that the indigenous communities need formal land titles to their lands.82 The government

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does not have the right to break their own laws in the interest of building the dam. The indigenous community has vindicated its position because the adverse effects of this dam will destroy their way of life. The land is an ancestral ground for the uplifting of their spirituality. If the dam is constructed, it will flood the lands of their ancestors, whom they worship. One indigenous person expressed, “our history, our identity and our common vision are, since time immemorial, intimately linked to the land, the rivers, and all manifestation of nature in our territories.”83 Currently, the indigenous community is not fully integrated as mainstream members of Costa Rican society. They face a lack of recognition of rights. This lack of rights brings to light the real argument of the lack of land titles provided to the indigenous community. The indigenous community wants to own the land they irrigate and manage. The lack of rights has resulted in poor health, high unemployment, and poor education. As provided in previous cases, there will be few opportunities for them to find jobs and find a location to reside. There are no benefits for these communities and the loss of the land without proper compensation, as mirrored in other cases, has hurt the indigenous population, their way of life, and their practice of their faith. In one case, the government of Surinam built a dam on indigenous soil promising job security to the indigenous inhabitants in 1966. To this day, the government has not fulfilled the promises and the 5,000 indigenous peoples are living in the worst slums of Paramaribo.84 Another example is the Guatemala case that flooded 13,000 square miles of rainforests, home of half of the world’s animal species and 3,000 plant species. The reserve was the Maya biosphere, one of among 60 indigenous communities in Guatemala that were affected by this dam because transnational corporations determined there were 1.4 billion barrels of crude oil under the reserve.85 As protected people in Costa Rica and the rightful owners of the land where the dam is to be built, the indigenous Boruca community would like to be consulted in the process to help guide ICE in building the Boruca Hydroelectric Project.86

Térraba Indigenous Community The research field analysis conducted by Arcadia University discovered that the Térraba communities of an estimated 1,500 people were adamant about the construction of a dam in their region. Seeing themselves first as indigenous and then Costa Rican, they had animosity towards the

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Costa Rica Electricity Institute (Instituto Costarricense de Electricidad [ICE]). They felt that ICE manipulates people, making promises they cannot keep. They did not want to consider the option. The Térraba community cannot afford the ecological and economical benefits from this project. They cannot afford the tourism because 97 percent of the population is poor in Térraba and resources are scarce.87 The Térraba community illustrated that the loss of their land will result in low productivity of their crops, such as corn. The water will produce a climatic change in temperature reducing it to below 30ºC. This will result in lesser yields of all crops. In fact, the large reservoir would create this climatic change. The sun will heat sediment and vegetation from the still water and will get into the reservoir, causing decomposition, thereby releasing greenhouse gasses into the air. An indigenous representative stated that the average temperature would rise, trees would fall, and there would be many diseases caused by mosquitoes.88 Since there will be a climatic change, there will be less water available for the land that was once showered with rain.89 The water table will be decreased by 60 percent and all the spring water in the area will dry up. Rivera stated there will be decreased water levels endangering the health of wildlife near the dam as well as the livelihood of the community that depends on those animals.90 Térraba is known to have fourteen beautiful water fountains, which will all be stressed after the construction of the dam. The land also has ancestral meaning to the Térraba community and the dam will affect their spirituality.91 The lives and identity of the Térraba community will change forever. The impact will be huge for the community, bringing in lots of machinery and increasing machismo attitudes, for example, flirting and harassment. Rivera further stated that the area is not prepared for this overpopulation; it is an area lacking basic services. There is the potential for more alcohol and drug abuse, and prostitution. The possible influx of 3,000– 5,000 people would threaten the cultural identity of the indigenous peoples (Baxter-Neal, L., 2006).92 Locals were promised job security, but it is cheap labor for five years and does not take into consideration the level of education needed for promotion for higher pay. There will be no job security after five years since the government will no longer need these workers as the surplus fades and demand of the country is met. Locals want long-term job security, and without this initial promise, they know the job security will not be guaranteed.93 ICE only does projects that benefit them.94 Enrique Rivera, an indigenous representative stated that “they have said that we are going to have a

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lot of economic advantages, but it isn’t true. There isn’t one guarantee at this moment that it’s true.”95 The Térraba indigenous community wants to be consulted on the project. They feel that consultation on the project will lead them to a mutual understanding of the project with the ICE and that it will build social acceptance and social capital.96 Since the land is nontransferable and is protected territory, the Térraba indigenous community has no problem or faces no conflict giving it up, but would like to be included and involved in the project to represent their community and their concerns. They would like to have a team from Térraba conducting its own research and believe they can provide better consultation on this project than the outsourced consultants.97 The Térraba community would like to be compensated for their expected losses from the construction of the dam. They want to receive benefits/ royalties from the dam each year that would subsidize the revenue they would have received from the high yields of crops. They want the assurance of financial benefit before they give up their land. The Térraba community is asking for 860,000 colones ($1,720.00 each) to be given to each person affected by the dam.98 For a community of 1,500, ICE needs to pay out $2.58 million. Payment could also be negotiated on a per family basis. They want to have 46 million colones ($92,000.00) total for the farm land they will lose; this amount should be provided to all the families in the Térraba community. They want financial security.99 Although 90 percent of the Térraba community consider themselves first as indigenous and second Costa Rican, they want to garner respect from the Government of Costa Rica, ICE, and all development contractors. They also want international support. They want their rights to be respected, and to be acknowledged as Costa Ricans and as human beings. The rights of the Térraba community have been violated during this process; if they are respected, they would be participating in the negotiation process.100 With nearly 30 years of time and investment, ICE believes the Boruca Hydroelectric Dam could meet the demands of the current population and simultaneously provide hard currency for the country with the export of electricity. If no solution is discovered by 2012, the current expectations of Costa Rican electricity demands will overturn the supply. ICE further believes that the electricity project will not hurt the environment because they will be utilizing 13–18 percent of the available potential hydroelectric power, and the vast potential amounts of power have not been fully used.101 In 1995, ICE established a water basin management system that cleans and reduces sediments in the reservoirs.

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The objectives of this system relate to better human development, preservation of natural resources, and the ecosystem.102 ICE, therefore, recognized the need to preserve the biological diversity and ecological diversity because of their importance to this project. One of the main objectives of this project is to attract multinational investment corporations to the region and export its surplus electricity to neighboring countries. With this project underway, Costa Rica will utilize the 33 protected areas of biological reserves, national parks, wildlife refuges, and natural resources to preserve biological diversity and bring hard currency to attract tourism to these areas. ICE began studying the Boruca Project in the 1970s, anticipating that this project would provide greater electrical stability to the southern region of Costa Rica, where 5 percent of the population does not have electricity.103 The 5 percent, or 200,000 people, all reside in the south; the remaining 94.9 percent have electricity and reside in the remaining areas of Costa Rica. ICE has invested $3 million a year. Since the 1970s, ICE has placed over $20 million into this billion dollar project. During this process, ICE hoped to negotiate with the indigenous community in regards to the building of this dam on their lands. They want to give them the opportunity to express their interests and have them assist ICE with the project. ICE has repeatedly stated that it has involved the indigenous community as a consultant to the project since the beginning with an emphasis toward the latter part of the 30 years.104 Between 1998 and 2002, ICE has indicated they have had 96 meetings with the indigenous community and received telephone and written communication from the communities in Boruca.105 ICE apparently does not want to exclude anyone from this project and values consultation.106 In March 2002, ICE met with several indigenous development associations soon after the OmCED mediator came and spelled out the legality of the project to the community. ICE has committed itself to resolving any historical problems with the indigenous communities, particularly concerning the land titles.

Indigenous Reserve “Rey Curré” Another opposing party, the indigenous of Rey Curré, though facing a giant, actually have a great deal in their favor and much more power than commonly perceived. They have been delaying the progression of the dam in order to allow further exploration. They have spent time researching causes and past events similar to their own, and are currently in the process

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of exploring the option of taking the Boruca case to an international court. They are actively trying to make their cause known to people, organizations, and institutions not previously involved, including the WCD. They have the further advantage of Costa Rica’s overall character as a peace-loving, conscientious member of the international community on their side. Rey Curré has support from the other indigenous communities and organizations as well as the International Dam project. Because the Rey Curré community is not currently in communication with ICE, they have decided not to move forward with any actions with these support groups. If they begin to feel pressured by ICE, they say they will reactivate their solidarity mechanisms. One of the main causes of uncertainty for the indigenous peoples as a group is that there is a lack of solidarity, some in favor of the project, some diametrically opposed, seeing not one benefit for themselves from the dam construction. Still bruised from the relatively recent imposition of the Inter-American Highway cutting through their lands, a forced relocation would be one more blow to their identity, and to the fragile state of their collective culture. In contrast, for those opposed to the construction of the Boruca Dam (primarily those indigenous peoples forced to relocate), the conflict centers on the violation of their rights to land and a refusal to vacate historic areas that are linked to their culture. Given the current trajectory of the dialogue and the imbalance in power, the indigenous peoples remain at a distinct disadvantage. While the indigenous peoples who live within the areas planned for inundation have taken strides in organizing themselves and have succeeded in forming ties with other groups who might help their cause, current prospects for stopping dam construction look fairly bleak. Effective conflict management necessitates the treatment of structural issues that underlie a topical dispute. Although the Boruca Dam is the specific match that has sparked this conflict, the historic relationship between indigenous communities and the government exists at the heart of the problem. For many generations, indigenous communities have suffered broken promises and insensitivity at the hands of the Costa Rican government. Further, they have been largely shut out of the formal government arenas where they might advance their concerns. Therefore, without attaining greater sway in the political process, the indigenous people remain in an inferior position vis-à-vis ICE, and it is unlikely they will experience just negotiations.

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Environmentalists Environmentalists agree that the dam is not needed. A report issued by the WCD concludes that large dams have failed in their effort to produce electricity, provide water, and control the floods. There are better and alternative technologies to constructing dams that are cheaper and do not affect the environment. If the Boruca Project goes forward, it will lead to all of Costa Rica’s rivers being dammed. This strategy will allow Costa Rica to be the dominant power in its control of natural resources in Central America. Pineapple farms had a lot of erosion with the construction of the InterAmerican highway. The wetlands/mangroves along the river have been affected too. The wetlands are an official RAMSAR site, which requires the conservation of those wetlands. The designers of this project knew the potential of affecting the environment. For many years Costa Rica was famous for its elimination of forests for cattle ranches to provide U.S. hamburgers. By now, the forests in the low lands have disappeared. The overuse of the forest resources, the agrochemicals from agriculture, the residue waters from shrimp cultivation, and this dam will increase the fragility of the environment (CDA, 2002). The environmentalists would suggest exploring other alternatives to pursue a revitalization of the energy economy of Costa Rica and to meet the energy demands of Costa Rica. Other possible alternatives are solar or thermal energy. In 2002, the Constitutional Assembly of Costa Rica uttered in the public arena that the indigenous groups’ lands need formal land titles. In November 2001, a request was presented to the Assembly regarding the secession of land under 1977 Indigenous Law 6172. The Assembly presented to the government of Costa Rica the need for the consideration of indigenous rights and to provide land titles. It had also given the Institute of Agrarian Development (IDA) 6 months to conclude land titling, but IDA has yet to respond because of the difficulties it foresees in the demarcation of land. Also, lands created prior to Law 6172 and roads would be excluded, even though Law 6172 includes all indigenous lands given to the reserves. However, IDA has been involved in granting land concessions and exploitation rights to foreign companies for monoagricultural production of bananas and pineapples (CDA, 2002). The Associations of Indigenous Development (ADI) believes demarcations are important because it defines the jurisdiction and land markers of the indigenous community to protect the land and natural resources. ADI, however, lacks government funding to conduct studies that could protect the rights of the indigenous people within their communities.

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Currently, there is a dispute between IDA and the indigenous community over the boundaries on the reserves that have been unmarked and not legally defined. Squatters represent the biggest danger to indigenous reserves as they have currently occupied 85 percent of their land. ICE and IDA are to work on the demarcation of the reserves and the replanting of the borders of the reserves to reduce confusion and ensure borders are marked (CDA, 2006). ADI further acknowledges the difficulties in managing the reserves with the lack of boundaries. There should be cooperation between IDA and the indigenous communities to collaborate on the 39 kilometers stretch without natural borders as they are causing conflict.107 In Central America, Costa Rica is a more stable nation compared to its counterparts; however, the country still burdens its economy with external deficits and debts. Costa Rica is also having problems reducing inflation because of the rise in the price of imports and the labor market laws. Also, the country needs to reform its tax system to address the tax evasion in the country. The failures Costa Rica is experiencing in its fiscal reform, combined with a rise in U.S. interest rates, could potentially expand the debt of Costa Rica. In order to grapple with the internal and external debt, the construction of the dam would produce surplus electricity that could put the country back on track and import currency into the economy for the first five years. It would also meet the demand of consumers, attracting foreign investment and allowing for a stabilized economy. One of the PPP project components is tourism promotion. The construction of the dam will also provide funds that would help the tourism industry and boost the economy. Costa Rica’s major income is tourism, particularly ecotourism. This would promote free trade and the development of modern laws that could close the trade deficit (CDA, 2006). The Government of Costa Rica is facing, apart from environmentalists’ opposition, opposition from trade unions, business leaders, indigenous communities, and locals for the implementation of the project and the signing of the Central American Free Trade Agreement (CAFTA). Further, CAFTA could jeopardize Costa Rica’s relationship with other Latin American countries and the import of oil from Venezuela.

United States of America In 1994, North American Free Trade Agreement (NAFTA) included rules for trade liberalization between Mexico, United States, and Canada.

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In 2001, the PPP project was introduced by Mexico’s president Vincente Fox to help build infrastructure and roads for U.S. businesses and producers in Central American markets. With the help from the banks, the dam would help the United States achieve the CAFTA Agreement. The United States wants to expand NAFTA’s rules to all 34 countries in North, Central, and South America including the Caribbean countries. This trade agreement, known as FTAA or the Free Trade Area of the Americas, was a precursor to CAFTA (CDA, 2006). The United States wants to be the leading hegemonic power controlling the energy market in Central America and therefore needed Costa Rica to sign the CAFTA agreement. The Free Trade Arena will create a single trading block under U.S. hegemony that will compete against European and Asian blocks. By implementing the CAFTA agreement, it would reserve the entire western hemisphere for the United States competing against China and India. Costa Rica was showing reluctance to ratifying the CAFTA agreement, but finally it was accepted. The United States is interested in Costa Rica because it has the region’s healthiest and most well-educated workforce, and its technology is sophisticated with the production of computer chips, integrated circuits, and medical equipment (CDA, 2006). The United States is committed to helping Costa Rica and is providing an incentive to write off all debts of Costa Rica so that they can expand their financial resources into technology, education, governance, and other social conditions (CDA, 2006).

Canada Canada’s main interest is to be actively involved in the free trade agreements that would provide Canada strategic opportunities to access Central American markets and expand NAFTA’s objectives. The Boruca Dam would facilitate this process by inviting Canada and other transnational corporations from Canada. It also wants to be a hegemonic country in the energy market.108

Involvement of Institutions The National Commission for Indigenous Affairs (CONAI) CONAI was an organization created under Law No. 5251 to represent all indigenous affairs in Costa Rica. There have been many sustainable

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development projects that have caused communication conflict with the indigenous population and CONAI. The bureaucratic nature of CONAI led to pressure on the resources of the indigenous reserves, population growth, increase in economic activities, and conditions of extreme poverty (CDA, 2006). Article 5 of an agreement of the OmCED stated “CONAI is the only institution responsible for indigenous affairs and that any other organization interested in assisting or supporting indigenous communities must expressly be authorized by CONAI” (CDA, 2006). OmCED was the mediator/facilitator that began a dialogue between CONAI and the indigenous peoples of Costa Rica. Many indigenous peoples, however, claim that CONAI is ineffective in the protection of the indigenous community’s rights. An important person in the country stated, “when the moment arrives for CONAI to stand up for the Indian people, they don’t dare. They duck down behind their desks and wait for their paychecks to arrive.”109 On August 30, 2006, CONAI led a protest with hundreds of indigenous supporters of CONAI to protest a proposed law on the autonomous development of indigenous communities that would return indigenous lands to the indigenous peoples and increase healthcare to isolated indigenous communities. They were protesting because the law in Costa Rica is not created by the indigenous people, but legislators. CONAI is supposed to be the representative of the indigenous population, but the interim director of CONAI protested because CONAI would cease to exist under this new law and would no longer have control over indigenous lands. The control would be given to the indigenous communities.110

Inter-Development Bank/World Bank/Financial Institutions The Inter-Development Bank and the World Bank are among many financial institutions that would like to move forward with the Boruca Dam Project. The majority of the $1.4 billion dollar plan for the Boruca Dam Project would be provided by the World Bank if the indigenous question can be solved. Financing this plan would help Costa Rica increase foreign investment and their economy. In return, the World Bank would receive payments to pay back the loan. The Inter-Development Bank is in favor of the CAFTA agreement, which may be possible through the construction of this dam, roads, and a whole network. U.S.-based Harken Energy Corporation would like to drill oil in Costa Rica as Costa Rica is rich in this natural resource. The Fifth Centennial Development Fund of Spain plans to develop the Central American Electric Interconnection

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System with transformers built in all neighboring countries, controlling the energy grid. This plan also includes an assessment to build 25 hydroelectric dams in Costa Rica, one of which is the Boruca Dam Project.

Plan Puebla Panamá The Government of Costa Rica has been involved with Mexico’s Plan Puebla Panamá (PPP) that begins from Puebla, Mexico and extends through southern Panamá, with the intention of privatizing lands and resources to attract foreign and private investors. The PPP has the greater potential to create jobs, promote economic prosperity, and to provide opportunities for the government to close its trade and internal deficit gap. The obstacles to this project are the lack of interconnecting roads and electricity. Therefore, the proponents for this plan want to build the Boruca Dam so that they can go to Panamá and provide economic opportunities for Costa Rica (CDA, 2006). It is a 25-year $20 billion dollar plan that includes all seven Central American countries and is the highest priority of the IADB, which is funding this project. The plan calls for 5,565 miles of new or improved highways; 1,130 new electrical wires carrying power generated by gas and dams; and the physical infrastructure needed for the FTAA and CAFTA. The real force behind this debate is the IADB, which helped design the PPP into eight different initiatives: sustainable development, human development, natural disaster prevention and mitigation, tourism promotion, trade facilitation, road integration, energy interconnection, and telecommunications development. Under the tourism promotion, it plans to strengthen airport security. More than 90 percent of the proposed funding would go toward transportation, infrastructure improvement, and energy interconnection.111

SIEPAC SIEPAC, known as the Electricity Interconnection System for the Central American Countries, is a project kindled in the PPP project. The plan is to build a 1,830-kilometer, 230-kV energy distribution line between southern Mexico and Panamá. The total cost of this line will be $320 million. SIEPAC is the most advanced of all PPP mega projects. It plans to lower the costs of energy distribution by 20 percent, bringing the current rate of $0.11 per kilowatt hour (kWh) down to $0.09 per kWh in 2010 through the creation of the regional energy market. This project is in line with Costa Rican regional development plans, which would lower the costs of electricity,

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putting more money into the pockets of the consumers and the government. The financing of this project also comes from the IDB that has loaned $30 million to each member country. In Costa Rica alone, Hydro Quebec, a Canadian firm, has purchased privatized energy generation. SIEPAC foresees that the current 7,500 GW of regional energy will increase to 30,000 GW in the next 30 years. Current energy demand in the region is 5,000 MW and will crease 550 percent in the next 30 years to 22,000 MW.112 A new hydroelectric dam project such as the 1,000 MW Boruca Project will facilitate SIEPAC and the PPP to help meet the energy demand.113 The current assessment of Central America is that 25 to 50 percent of Central Americans will remain without access to electricity unless current capacities are increased.114

Public Understanding and Participation The public does not have a complete understanding of the costs and benefits of various electricity generation methods. For this reason, ICE’s planning department claims that geothermal exploitation in National Parks is impossible, building fossil fuel plants creates less opposition than hydropower and Costa Rican citizens would be opposed to any rate increase in electricity bills. A national conversation on these topics must be initiated. Consumers must understand that there are always costs and benefit decisions to be made to meet their lifestyle requirements. In this way, citizens can make informed decisions about what kinds of electricity generation they prefer. A freer market might also allow this kind of preference. A dialogue needs to be opened about the role of private industry and the accounting methods of ICE. Unfortunately, the government’s recent disbanding of the mixed commission on the ICE law strengthened this barrier.

Conclusions The WCD provided a methodology incorporating the involvement of stakeholders as one of the best planning assessments before the construction of a dam. The involvement of stakeholders invites dialogue and frames the argument around the vindicated mediation framework of positions, interests, and needs. The WCD proposed a strategy that revolved around four principles: (1) As explained, the stakeholder analysis conducted was shown to prospective advocates of all sides to assist in preparing the necessary arguments to either support the Boruca Dam Project or to rule against

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the project. (2) The analysis was conducted through their positions, interests, and needs. It will be up to the Government of Costa Rica to help meet the needs of the parties while the parties themselves will have to be ready to sacrifice some of their positions to facilitate an agreement. Listed in the mediation framework are detailed plans of all the parties involved through their interests. It was through their interests that we understood the reasons behind their positions and their ultimate goals for this project. (3) In light of this framework, the techniques and tools were mentioned, but served as individualistic statements in the parties’ framework. Financing and time were also important components in many of the parties’ frameworks and they also merited brief mentions in their arguments. (4) Fulfilling the ideas behind the WCD, the mediation framework’s last task is to assess these positions, interests, and needs and come to an agreement.

Sociocultural and Economic Aspects PH-Boruca is situated in the “Brunca Region” in Southeastern Costa Rica. Most of the population living in the area has problems such as lack of housing, limited employment options, crisis in the farming sector, low levels of formal education, and territorial vulnerability in common. Perhaps one aspect that differentiates this area from the rest of the country is the ethnic diversity and multiplicity of values associated with this ethnocultural wealth.115 Thirty-three percent of the total indigenous population of Costa Rica lives In the Brunca Region. The total of the population affected by the project is 6,704 people, 18 percent of whom are indigenous, 76 percent nonindigenous, and the rest are considered racially mixed.116 Figure 3.4 presents a comparison of indigenous territories more or less affected by the PH-Boruca and lays out their most important characteristics such as population, land held by indigenous peoples, infrastructure, legal representation, productive activities, problems faced, and other characteristics of the indigenous reserves. There are seven ethnic groups living on reserves: Salitre, Ujarráz, Cabagra, Rey Curré, Térraba, Boruca, and Coto Brus, sharing a relative sociocultural unity of certain historical and physical characteristics, as well as sharing traditions, language, and religion, increasing in most cases, a territorial identity. These territories are inhabited at the present time by indigenous peoples and an increasing nonindigenous or “white” population.117 In general, there is not sufficient information on the situation of these territories and their communities; however, their populations are among

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CHARACTERISTICS

INDIGENOUS TERRITORIES Salitre

Cabagra

Boruca

Rey Curré

Térraba

Coto Brus

People

Cabécares

Bribri

Bribri

Brunka

Brunka

Térraba

Ngöbe, Guaymíes

Surface Area (in Hectares)

19,040

11,700

27,860

12,470

0,620

9,350

7,500

Number of Inhabitants

1,030

1,403

2,353 (Indigenous)

2,954

982

1,425

1,094

Percentage of Population that is Indigenous

36.5%

35.6%

Lands in the Hands of 31.7% Indigenous Peoples

40%

59%

39%

16%

12%

80%

Lands not in the Hands of Indigenous Peoples

68.3%

60%

41%

61%

84%

88%

20%

Languages

Cabécar and Spanish, with the former being lost

Bribri and Spanish, with the former being lost

Bribri and Spanish, with the former being lost

Brunka, spoken by only a few of the older Indigenous people.

Ngöbe, Bokotá Teribe– Only and Spanish one elderly but not fluently woman still speaks it but there have been great efforts to rescue the language

CONFLICT RESOLUTION OF BORUCA ENERGY PROJECT

Ujarráz

Infrasturcture

Lack of electrical infrastructure, potable water and bridges

Lack of bridges Lack of bridges and houses and houses

Abominable state of roads.

Bad roads

Lack of education, training and development of capacities for commercial production and distribution

Roads in bad condition

Lack of bridges and public transportation

Lack of bridges

Sparse network Poor condition Bad roads of roads and of roads housing deficiency

Lack of schools Lack of electricity and and other telephones in facilities some communities.

Lack of sewage systems

Insufficient educational infrastructure

Insufficient educational infrastructure

Lack of aqueduct

Housing deficit

Lack of health facilities

Lack of houses Lack of potable water and of health and deficient latrines medical attention

Insufficient educational infrastructure

Non-existent sewage system

Lack of aqueducts and to carry electricity to several communities Lack of houses of health, latrines and equipment to chlorinate the water

Analysis: Hydro-Project Boruca, Costa Rica

Lack of electricity and bridges

(Continued)

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CHARACTERISTICS

INDIGENOUS TERRITORIES Ujarráz

Salitre

Cabagra

Boruca

Térraba

Bad sewage system layout

Lack of schools

Lack of permanent medical facilities

Rey Curré

Coto Brus Bad roads

Lack of aqueducts Ancestral Customs

Traditions, histories, dances, arts

Some traditions, customs and beliefs, laws, dances and arts

Has its own folk Identity loss healer ‘El Awa’ due the presence of non-Indigenous dwellers

Loss of cultural identity, but they still possess the greatest ethnic identity

By the loss of (Indigenous) language and dress, they appear to be nonIndigenous villagers

‘Dance of the Some Little Devils’ traditions, laws, histories crafts and other knowledge

Intense social, cultural and environmental ties to the Boruca Communities

Practice a nonIndigenous lifestyle, owing to agricultural colonization and racial inter-mixing

Quite well-known crafts

Kinship relations

Complete loss of their language

Women wear bright dresses

CONFLICT RESOLUTION OF BORUCA ENERGY PROJECT

Insufficient educational infrastructure

Lack of potable water and health facilities

Typical Dance: ‘La Chichada’ Basketmaking and making of hammocks

Has its own folk healer ‘El Awa’

Has its own folk healer ‘El Awa’ who continues to have great importance

Chichas and Rice Tamales

Local recovery of the ‘Festival of the Little Devils’

No features of their ancestral culture have been preserved

and produce natural-fibre articles (purses, change purses and hats

Crafts such as calabash-gourd carving and cotton weaving

Typical Dances: ‘La Chichada’ and ‘El Bulcique’ Religious Background Principally Catholics and other small groups of Protestants

Principally Catholic (90%)

Many believe in the Catholic faith, but maintain also a belief in ‘Sibu’

Mainly Catholic, Protestant and Evangelical

Mainly Catholics with a few Protestants

Analysis: Hydro-Project Boruca, Costa Rica

However, is one Typical Dances: ‘La Chichada’ of the and ‘El Sorbón’ Indigenous groups that has preserved a large part of their culture

(Continued)

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CHARACTERISTICS

INDIGENOUS TERRITORIES Ujarráz

Salitre

Some profess belief in ‘Sibu’ their god

Belief in ‘Sibu’ (8%)

Cabagra

Boruca

Rey Curré

Térraba

Coto Brus ‘Ngöbe’ religious traditions still remain

Some profess a belief in ‘Cuasram’

Problems

Alcoholism and Loss of water and lands Domestic Violence

Migration of young people away

Deterioration of the environment and loss of lands

Deforestation to the degree that some water sources and disappeared

Deforestation and uncontrolled hunting

Contamination Illegal hunting and extraction of waters, of flora deforestation

Deforestation, One sector of Contamination Contamination Alcoholism and drug of the Boruca contamination Indigenous addiction of river sources people do not River see themselves as such and have entered into conflict

River overflow Unemployment Unemployment Health and bank problems: erosion Parasitosis, respiratory infections and skin afflictions

Allergy problems

Forest water contamination

Loss of High unemployment grounds and fires

CONFLICT RESOLUTION OF BORUCA ENERGY PROJECT

Some (2%) Protestants

Great deal of illiteracy and abandonment of school

Soil erosion Some migration to San José and to the US

Unemployment

Some migration to the US

Available lands are becoming scarce, increasing plagues

Association for Integral Development

Association for Integral Development

Association for Integral Development

Analysis: Hydro-Project Boruca, Costa Rica

Legal Representation

Contamination Division or river sources between Indigenous and nonIndigenous, adopting values and lifestyles with political, economic and legal perspectives apart from the traditional identity

Association for Integral Development (Continued)

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Lineage

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CHARACTERISTICS

INDIGENOUS TERRITORIES Salitre

Cabagra

System of kinship by matrilineal clans

System of kinship by matrilineal clans, most important, the regulating role of marriage

System of kinship of matrilineal clans, also being forgotten

Boruca

Rey Curré

Térraba

Coto Brus

Subsistence farming of rice, corn, beans, plantains, ‘pejibaye’ and tubers

Growing of rice, corn, beans, tuber and small areas of coffee

Subsistence farming of rice, maize, beans, cacao, palmito, tubers and banana

Being forgotten Being forgotten among young among young people people Productive Activity

Some Growing of production of Cacao, rice, corn, beans and artisan crafts pole beans, coffee, bananas, plantains, citrus fruits, pineapple, yuca, ‘tiquizque’ ‘ñampí’

Growing of Some production of rice, corn, artisan crafts beans and pole beans, a lot of coffee, plantains, citrus fruits, pineapple, yuca, ‘tiquizque’, ‘ñampí’ and ‘pejibaye’ and cotton

CONFLICT RESOLUTION OF BORUCA ENERGY PROJECT

Ujarráz

Some hunting and fishing

Growing of Cacao, rice, corn, Beans and pole beans, plantains, yuca, ‘tiquizque’, ‘ñampí’ and ‘pejibaye’

Other income source: Day laboring in neighboring fields

Some participation in forest conservation programs which generates higher economic resources

Some pig- and Some family cattle ranching, bird- raising as well as pig- and bird-raising

Some hunting Recently, some Excellent new crops such artesanal and fishing. handicrafts as chiles and ‘ayote’

Exhaustive cut-and burnproduction, indicating the use of large areas of terrain being rotated in order to leave them sallow

Artesanal craft such as carved masks and calabash gourds

Some fishing in the river

Some pig- and bird- raising as well as fishing

Some pig- and bird-raising

Small-scale artesanal crafts and sugar cane and annatto processing

Some families survive on cattle and horses together with hunting and fishing

Day labor coffee harvesting or construction

Artesanal crafts are fairly known

Analysis: Hydro-Project Boruca, Costa Rica

Some hunting Some family cattle ranching, and fishing as well as pig- and birdraising

Growing of rice, corn, beans and pole beans, plantains and tubers

(Continued)

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CHARACTERISTICS

INDIGENOUS TERRITORIES Ujarráz

Salitre

Cabagra

Boruca

Some pig- and Bags and other textile bird-raising products, basket-making

Some tourist activity

Some participation in forest conservation generating higher economic resources

Other sources of income: construction work and housekeeping

Group day – labor

Figure 3.4 Comparison of Seven Indigenous Territories Affected by PH-Boruca

Day-laboring represents large economic source

Térraba

Coto Brus Other source of income: Sale handicrafts on palm and coffee plantations

CONFLICT RESOLUTION OF BORUCA ENERGY PROJECT

Some family cattle ranching

Rey Curré

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the poorest segments of the national population, experiencing marginalization and exclusion relative to the country’s average standards of social development. Within the area affected by PH-Boruca at least one person in three (33.1 percent) faces some labor issues (unemployment or underemployment). Nearly 38 percent of the population engages in unskilled production activities, illustrating the deterioration of job creation in the area. Most of the job creating activities are farming-related, mainly the cultivation of palm oil, pineapples, banana trees, and coffee for export; rice, corn, and palm destined for the internal market; cattle ranching, tourist activities, and other products including hog and poultry-farming. The employment generating activities do not combine the conditions necessary for the people of the area to escape the poverty in which they are mired. In addition, the heavy weight of maintaining and supporting a family continues to fall on the area’s women. “Community Organizational Forms” continue to be traditional, as do the associations, spaces organized by public institutions, agricultural centers, health commissions, education summits, counsels, unions, and specific groups.118 Some examples of external cooperation are sponsored by international social movements, protected by resolutions or conventions, or taken up by civil society organizations (NGOs). In some indigenous territories, people tried to strengthen the defense of human rights related to their sociocultural identity.119 Generally speaking, residents have a strong sense of belonging to their people despite the uncertainty being generated by the doubts that these people have about the construction of the Boruca Dam and possible relocation of the population. For example, actions of the representatives of the “Rey Curré Reserve” against the Boruca Dam have been the following: z z z z

Protests (October 12, 2001) Recurso de Amparo (November, 2001) Demonstration in Térraba (Feb 15, 2002) Internet Roll-outs.

The industrial development in the area, to a great extent, is reduced to small artisan operations and industries such as furniture factories, tailoring, workshops, and assembly shops that are mainly concentrated in the Canton of Perez Zeledón.

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CONFLICT RESOLUTION OF BORUCA ENERGY PROJECT

The commercial activity depends to a great extent on the market’s purchasing power. For this reason, establishments dedicated to selling prepared foods, restaurants, bakeries and the like, are concentrated in the most important centers of population, the most affluent being the canton of Perez Zeledón. Included within the “Grande de Térraba River Basin” are protected areas such as “Chirripó National Park,” “The International Park of Friendship,” the protected areas of “Las Tables,” “The National Wetlands of Térraba Sierpe,” “The San Vito Wetlands,” and the “Lacustrino Laguna de las Paraguas Wetlands,” which rely on international legislation, and where the project’s environmental impact must be handled with special attention. In these areas ecotourism, agrotourism, ethnotourism, and adventurism are all developing. The Boruca Dam has been projected to increase tourism in the area, as has been the case with the “Arenal Dam” in northern Costa Rica. Tourism will have both positive and negative effects on the ecosystem. On the negative side, increased tourism will encourage increased road building and resource use in the area. Yet tourism might also spur improved ecosystem protection and management in promotion of ecotourism. Another positive environmental impact of the dam may be improved watershed management and reforestation of the massive 5,060 square kilometer Térraba watershed in order to prevent the sedimentation of the reservoir. The Boruca Dam would create major socioeconomic changes in the project area. The dam’s reservoir will force the relocation of about 3,000 people, primarily indigenous tribe members. The dam will inundate parts of three indigenous reserves and impose roads and development on another four indigenous reserves. The dam will create employment, at least during construction, and may increase tourism opportunities. Support for ICE and the project is extremely mixed, with some strong support among indigenous groups who hope for improved quality of life and opportunities from the dam while other groups are fiercely opposed to the project, citing their traditional ties to the land and lack of trust in ICE’s promises. Land possession is a serious problem. In most of the territories, nonindigenous persons are demanding some form of property rights for the lands on which they live or work, leaving the indigenous people to lose a large part of their territory. In “Térraba”, for example, 88 percent of the land is in the possession of nonindigenous people, and government authorities do not support the

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indigenous people’s attempts at territorial defense.120 It is within this context that the importance of the indigenous communities’ opposition to the construction of the Boruca Dam is demonstrated. The area affected by the dam is located within the archeological region of “Gran Chiriquí”, specifically in “Diquís”. It is in one of the largest hydrographic river basins in the Centro-American Pacific. From an archeological perspective, it is considered to be a prime area. Within the dam area, there are 83 sites located that will be flooded, and a lot of unanswered questions in regards to solving this problem.121

Ecological and Environmental Impacts Biophysical Characteristics of the Térraba Watershed In 2001, ICE, in collaboration with National Institute for Biodiversity (INBio) and the University of Costa Rica (UCR), conducted a preliminary biophysical characterization of the Térraba watershed.122 The watershed covers more than 5,060 square kilometers, with altitudes from 0 to 3,820 meters above sea level (m.a.s.l.). The watershed covers 14 life zones with a medium precipitation of 3,328 mm and a range of 2,000–5,600 mm. The current ecosystems/land use regimes include: 44.9 percent pastures, 43.7 percent forests of all types, 0.1 percent urban, 5.4 percent agriculture, 2.4 percent charales, 0.8 percent paramos, and 1.1 percent mangroves. However, these land uses have been changing rapidly over the past two decades. A 1996 study reported that mangroves in the wetlands are being destroyed at a rate of 116 hectares a year. Another report of the Boruca indigenous reserve within the watershed states that in 1993, 70 percent of the area was forested, whereas in 2004 only 20 percent was forested. Protected areas make up 13 percent of the watershed, including the “Chirripo National Park, Zona Protectora Las Tablas, and Térraba-Sierpe Wetlands.” Indigenous reserves cover 20.1 percent of the watershed: Ujarráz, Salitre, Cabagra, Térraba , Rey Curré and Boruca. In many of these reserves, however, more than 50 percent of the land is owned by nonindigenous people.123 As with most of Costa Rica, the watershed contains extensive biodiversity. Initial analysis identified 898 species of flora with a number of endemic and endangered species. As much as 50 percent of these specie types would be inundated by the Boruca Project, along with the habitat of many of the

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CONFLICT RESOLUTION OF BORUCA ENERGY PROJECT

229 species of mammals, including a few species with reduced populations, and 220 species of birds, 10 percent of which have reduced populations. Thirty-five percent of these bird species are found in the mangroves, which would be seriously impacted by the project. The estuary and river also are home to 62 species of amphibians and 108 species of reptiles, 2 of which are considered in danger of extinction, namely crocodiles and caimans. The river contains 41 species of fresh water fish, which represent 30 percent of the national ichthyofauna of fresh water. Out of the 41 species, 33 species are not very common and 12 species are endemic to the watershed.124 The Tropical Scientific Center125 performed a study on the ecological impact of the PH-Boruca proposal to create a vast lake in the General River Valley. The study revealed the main repercussions of the project: z z

z z z z z

z

z

An altering of the ecology of the Grande de Térraba River delta due to the loss of the positive effects of fluvial sedimentation An increase in the frequency and intensity of earthquakes in the area, caused by the construction of the dam close to a large and active geological fault An acceleration in all ground, vegetation, and water-system deterioration Problems of flooding and water control underneath the dam itself Loss of archeological sites. The study126 examined the following aspects more in detail: The natural ecological conditions of the area affected by the project, including the entire hydrographic river basin and the proposed industrial, mining, and harbor areas. The probable impact of the project with respect to the human ecology of the region, with particular emphasis on the possible effect of creating a lake, with respect to diseases in humans and domesticated cattle; urban and rural establishments; indigenous populations; archeological and historical relics; aquatic recreation; national and international tourism and; the landscape and overall aesthetic of the region. The possible effects that other development activities projected in the region— in particular construction of highways and local roads, logging, cattle ranching, agricultural colonization, and mining—could have on the water system and hydroelectric potential of the river basin as well as on the quality and degree of sedimentation of the waters entering the dam, including the possible effects on chemical and biological content of the dam water and spills into the river and sea.

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The eventual construction will constitute planned changes that would provoke environmental impacts of considerable magnitude. The data collected by means of physical surveys describes the magnitude and type of infrastructure of existing social development in the area. The diagnosis concludes that the evaluation of lost infrastructure is a topic that must be evaluated when making decisions on project networks. Given the implications for regional highway network development or communication infrastructure, for example, it is recommended to develop network projects within the frame of a program of regional development that maximizes the benefits of infrastructure replacement and stimulates the local economy. A broader environmental study was done in the area of PH - Boruca with the cooperation of the INBio, UCR and other institutions.127 The goal was to carry out a diagnosis of the Térraba River Basin, paying special attention to the areas directly affected by the different networks of development of hydroelectric projects based on environmental and social criteria (Figure 3.5) PH-Boruca will impact both the upstream ecosystems, due to the flooding of the reservoir, as well as the downstream ecosystems, because of the changes in the hydrology and sedimentation of the river. Impacts include loss of habitat and biodiversity, risk of increased seismic activity, risk of increased human and animal diseases, loss of sedimentation, and interference with periodic flooding in the Térraba estuary wetlands. Other tropical dam projects have also resulted in the release of significant levels of greenhouse gases. The project will also involve the flooding and subsequent redirecting of 50 kilometers of the Inter-American highway. A number of other roads will be built for the project construction and operation. All of this development during construction and operation of the dam will have important effects on the ecology of the area. More specifically, the following environmental studies were planned and executed128: z z z z z

Inventory of Manglar129 biodiversity Preliminary analysis of sedimentation hydrodynamics and tides at the mouth of the river Inventory of the flora and fauna in the area of the dam Analysis of water quality along the Grande de Térraba River The commencement of archeological exploration.

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CONFLICT RESOLUTION OF BORUCA ENERGY PROJECT

Economic Activity

PHYSICAL MEANS

STUDIES BIOTIC MEANS

HUMAN MEANS

REALITY Environment: ECOSYSTEM

INTEGRATION

DIAGNOSTIC SITUATION WITHOUT PHB

Source: ICE 2002, altered

Figure 3.5 Environmental Diagnosis of the Térraba River Basin

Another report130 states the project was in the stage of a feasibility study. According to this report, there is no official feature, nor clear central power. The planning has thus far only been discussed vis-á-vis exhibitions and never by documents put into the hands of the people, indicating perhaps they are hiding something. ICE and MINAE contradict each other through their respective discourses regarding the magnitude of the impact. “In terms of mutual incompatibility of interests, it is equally important to indicate what some emphasize as the advantages of the project, those being, among others, tourist attraction, foreign investment in the area, job creation, and the satisfaction of energy demand during the first few years of the project’s life. This diversity of interests and actors is what a high mutual incompatibility generates, creating highly complex scenarios.”131 The potential risks, effects, and impacts of dams can modify the critical waters below, regulate the fluvial structure, and/or affect beaches and river deltas. Ecological impacts can occur at the mouth of the Térraba River, in which both positive and negative impacts on the ecosystem of mangrove swamps can occur. A vital aspect to consider with respect to dams is the process of sedimentation, which can reduce the life span of the dam. In the case of Boruca, ICE will have to make an effort and investment to control and to reduce

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erosion in the surrounding areas and river basins which will supply the lake. It will be necessary to reforest and to establish control programs for erosion in the badly deforested area. Another aspect to consider in the construction of the dam, which will depend on the topographical and geological conditions of the site, is the alteration of water systems in the area near the dam. The consequence would be a change in aboveground and underground water systems. These alterations can be positive or negative. Salinization is another possible impact of a dam, principally when brackish lands are flooded by the evaporation of the retained water, or when lands with brackish waters are irrigated. Perhaps most important is dam stability in the face of potential earth quakes. In Costa Rica this aspect is vital, especially because the Boruca Project would be located in a seismic zone. A dam can induce earthquakes or can be conversely affected by them, mainly when active faults shift or phreatic levels132 are greatly altered. Evaporation is a theme in large dams. For example, in Syria and Iraq, losses by evaporation reach 200–240 liters for each cubic meter of capacity per dam. In northeastern Brazil, losses reach 10 percent in humid years and a 25 percent in dry years.133 Additional considerations are the dam’s effects on the local climate, which depends on the topographical and meteorological conditions. The contrary might be even more serious, namely the climate’s effect on the dam, especially during the construction stage. Eutrophication must also be considered. It is not only that a dam fills with aquatic plants; water lilies can seriously affect hydroplant operations and reduce the dam’s life span of usefulness. In filling the dam, massive death of vegetal species and migration of fauna can occur. Also a colony of aquatic species will likely appear in the lake. After many years the system would stabilize, but during the transition there would be irregularities in the amount and quality of organisms. A complex metamorphosis of land and aquatic life would occur. If the dam is used for irrigation, vegetal populations of the irrigable areas would be altered, or reforestation of the river basin could be planned to prevent erosion. With regard to fauna, the greatest impacts occur on river animals and birds. An increase in sport fishing could be expected, for example, if new species are introduced, which could even help to fight against eutrophication. The dam could attract migratory birds, creating feeding, resting, and nest-building areas, all of which would favor tourism.

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CONFLICT RESOLUTION OF BORUCA ENERGY PROJECT

Downstream Ecological Impacts The downstream impacts of PH-Boruca will be extremely significant. The dam, especially during the flooding of the reservoir, will irreversibly affect the hydrology of the river, impacting aquatic habitats and the wetlands downstream. Residents near the Angosta Project in Turrialba, Costa Rica report regular areas of dry riverbed as long as 10 kilometers. Eutrophication and decomposition in the reservoir can contaminate water as much as 50 kilometers downstream, killing fish and other aquatic animals. The disruption of floodplain ecosystems is often severe. Dams block the periodic flooding on which downstream ecosystems and farmers depend. Ironically the mitigation of flooding is often mentioned as a benefit of dam construction. River and floodplain ecosystems are closely adapted to a river’s flooding cycle. Native plants and animals depend on this cycle for reproduction, hatching, and migration. Annual floods deposit nutrients on the land, flush out backwater channels, and replenish wetlands. Studies of floodplains in a number of areas have shown a reduction in diversity of forest species after damming. The Térraba River does not end in a floodplain but the wetlands would be seriously affected. Wetland estuaries are particularly rich ecosystems. Some 80 percent of the world’s fish catch comes from these habitats, which depend on the volume and timing of nutrients and fresh water. Many biologists believe that the alteration of the flows reaching estuaries because of dams is a major cause of the precipitous decline of sea fisheries in the Gulf of Mexico, the Black and Caspian Seas, California’s San Francisco Bay, the Eastern Mediterranean, and other smaller seas. Dams also impact estuary river migratory species such as shrimp and snails. The Térraba wetlands would also be seriously affected by the loss of sedimentation caused by the dam. Riverbeds can be eroded by several meters within a decade of creating a dam, with impacts hundreds of miles downstream. Nine years after the Hoover Dam was completed, the riverbed had lowered by more than four meters. The loss of riverbed gravel reduces habitat for fish spawning and invertebrates. Loss of sediments also has severe impacts on estuaries and coastal habitats. At the mouth of the Volta River in Ghana, an upstream dam has cut off sediment to the estuary, affecting neighboring Togo and Benin whose coasts are now receding at a rate of 10–15 meters per year. Coastal erosion near the mouth of the Térraba River might have severe impacts on

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important ecosystems and tourist destinations on which Costa Rica depends, including Corcovado National Park. Moreover, the Térraba–Sierpe wetlands are one of the principle remaining conglomerates of mangroves in Central America and recognized as a major site protected in the International Ramsar Convention on the Conservation of Wetlands. The Boruca Project could be a major incompliance for the Costa Rican government. Recently a number of scientists have been working on mitigation techniques for the downstream effects of dams, such as simulating flooding periods and dragging and dumping sediments collected in the reservoir. Scientists, however, conclude that once altered by dam construction, a regulated alluvial river will never function as before.

Impacts of Flooding the Reservoir The most obvious impact of the creation of an artificial lake of 25,000 hectares is the destruction of vegetation and habitat in the flooded area, including risks to the above described biodiversity and endemic species. Recent deforestation reduces the loss of mammal habitat from flooding, but fish population could be seriously threatened. In the Tucuruí dam project in Brazil, high fish mortality rates occurred in the reservoir area after the initial closing of the dam. Overall the reservoir area saw a reduction from 173 to 123 fish species (a 29 percent decline). The death of the fishes resulted from a number of factors, including (1) the inundation of the highly oxygenated ecosystem of the upper watershed waterfalls, which was an important habitat for the juvenile of many species; (2) increased water levels, slower currents, and the amount of dissolved oxygen falling; (3) the diversity of niches being reduced; and (4) the lack of oxygen in the deeper levels because of the decomposition of submerged organic matter. It is likely that all of these factors will be present in the Boruca case. An eventual increase in fish catches can be expected as the oxygen levels in the reservoir stabilize. In the Tucuruí case, water quality studies indicate that there is a trend toward stabilization in reservoir water quality. Unfortunately, problems of decomposition contamination can be exacerbated when the water is very deep because sunlight cannot reach the depths. In the case of Boruca this is a concern as the lake will be one of the deepest in the world relative to its extension. Eutrophication of the reservoir water immediately after flooding will be extreme due to the decomposition of the submerged plant

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matter and leaching of nutrients from flooded riverbanks. As well as fish kill, eutrophication has a number of other negative environmental impacts, including noxious smells, rendering water unsuitable for human use, and providing a habitat for mosquito breeding, which can spread animal and human diseases such as malaria, filariasis, and yellow fever. In general, the impacts on ecosystems are more negative than positive and have caused, in many cases, significant and irreversible losses of species and ecosystems. Some cases nevertheless, have resulted in the enrichment of ecosystems by means of the creation of new wetlands, habitats for fish, and opportunities for recreation generated by the new dam. The WCD134 found that all the dams analyzed emit greenhouse gases, as do natural lakes, because of the decomposition of vegetation. The magnitude of these emissions varies. The preliminary case study data of a hydroelectric dam in Brazil shows that the gross level of these emissions is significant, as compared with an equivalent thermoelectrical plant. However, in other studied dams (in particular those in the Northern Hemisphere), the gross green house gas emissions are considerably lower than a thermal alternative. An exhaustive comparison would require measuring the emissions of natural habitats before the creation of a dam. It is necessary to investigate more on the basis of concrete cases in order to demonstrate the capacity that hydroelectric energy has to make up for climatic change.

Impacts on Watershed Management Development of the dam may have positive impacts on the management of the Térraba watershed. Reservoir sedimentation and water flow reduction from upper watershed deforestation can be a significant expense for hydroelectric dam operations. In the Angosta reservoir in Costa Rica 1,600 tons of sediments are dragged per year to keep the dam operational. For this reason, many dam operators have begun a system of payment for environmental services to protect the integrity of the upper watershed. Operators will pay land owners to reforest or not to deforest. ICE has affirmed that it will protect the upper Térraba watershed, pay to stop deforestation, and recover the watershed. This would be a positive step to stop the large amounts of deforestation occurring, including preventing massive fires caused by forest clearing practices. Recently there have been a number of large fires that have spread and destroyed thousands of hectares in the “Ujarrás” area, “Cerro Dúrika,” and el “Parque Internacional

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La Amistad.” Unfortunately, ICE has been unwilling to voluntarily pay for watershed environmental services, as have smaller private hydroelectric companies.

Construction and Development Impacts The Boruca Dam reservoir will flood more than 50 km of the InterAmerican Highway. The project would also require building hundreds of kilometers of roads to reconnect communities cut off by the reservoir, as well as even more kilometers of roads to service the construction. Housing facilities and all of the additional services—electricity, water, food, sewage, and waste—will need to be built for the huge immigration of construction workers and for relocated citizens. These factors will have severe impacts on the local ecosystem and resources.

Mitigation To date, efforts that have been made to counteract the impacts of large dams on ecosystems have only had limited success due to the lack of attention in anticipating and avoiding those impacts, the poor quality and uncertainty of forecasts, the difficulty in facing all the impacts, and the incomplete application and partial success of mitigation measures. In particular the following: z

z

z

z

It is not possible to mitigate many of the impacts caused by the creation of dams on ecosystems and their biodiversity, and the efforts made for “rescuing” the fauna and flora have had, in the long term, little success. The use of channels for fish, in order to mitigate the blocking of migratory fish, has also had little success since the technology frequently is not custom-designed for specific places and species. Good mitigation is the result of a good base of information, good equipment design on the dam, early cooperation between ecologists and the affected people, and the control and regularity of information with respect to the effectiveness of mitigation measures. Required environmental flows (including flows to cause controlled floods) increasingly are used to reduce the impacts of changes in underground water flow, in aquatic and coastal ecosystems, and in flood plains.

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Given the limited success of traditional mitigation measures at the moment, the greatest importance is the necessity to avoid or diminish ecological impacts by means of conserving specific segments of the river, or the river basin, in their natural states, and by means of project selection, alternative locations, and designs. In addition, in order to resist the loss of ecosystems and biodiversity caused by large dams, a compensatory approach is being experimented with, by means of investment in conservation, regeneration, and protection of other threatened places that have an equivalent ecological value. Finally, in a number of industrialized countries, in particular in the United States, a restoration of ecosystems is being carried out, resulting from the dismantling of great dams. A report from ICE135 states that a Colombian consulting firm was contracted for 18 months, INGETEC S.A, financed by IADB. The object of this contract was to help ICE in the selection of the optimal scheme of development for the Grande de Térraba River Basin and to complete the feasibility study of the environmental impact of PH-Boruca. This study was carried out in 2004. The results are not known nor have they been published by ICE.

Large-Scale Hydroelectric Power Plants Many international researchers and activists have argued that the costs— social, financial, and environmental—of large dams outweigh the benefits. The WCD has concluded that, “on balance, the ecosystem impacts [of large dams] are more negative than positive and they have led, in many cases, to significant and irreversible loss of species and ecosystems.”136 Large dam projects in Costa Rica are particularly controversial, especially the Boruca Dam Project upon which ICE’s recommended plan hinges. Civil society groups have contested the Boruca Project on both environmental and social justice concerns. ICE’s other planned large dam on the Pacuare River has been stalled by a MINAE investigation into environmental violations. Local communities protest the project because of possible negative impacts on the rafting industry. Controversy continues over water pollution and unmet promises in the most recent large dam project, Angostura, in eastern Costa Rica.137 Finally, in the “Plan de Expansion de Energia,” ICE’s planning department admits the growing opposition from conservationists and locals and affirms that the best sites for hydroelectric power have already been exploited and future projects present growing costs. ICE might use these

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challenges as arguments against large-scale hydroelectric projects and as arguments for greater reliance on fossil fuel plants.138 They obviously have not seriously considered the significant drawbacks that fossil fuel plants introduce.

Violence and Conflict Resolution Many of those involved in the conflict acknowledge two phases of the PH-Boruca conflict. The first phase is characterized by the strong-armed tactics of the then project director. During this time, the overall conflict environment was hostile. The indigenous communities of the potentially affected area were informed that the Boruca Dam would be built, they would lose their lands, and they would have to deal with those facts. The first phase of the conflict ended with the arrival of a new project director. With a new director at ICE came an increased consciousness of existing domestic and international legislation regarding the protection for indigenous rights. Efforts to communicate and share information between ICE and affected communities have improved. The existence of any dialogue or information sharing at all is a considerable improvement over the situation that prevailed during the first phase. Although ICE has stated that it has been supplying information to all of the people who would be affected by the project, other actors interviewed commented that they had been given very little to no information by ICE. The overall impression is one of a complete lack of communication between the parties about benefits, costs, and details of dam construction, and the impact it would have including rerouting of the Inter-American Highway, and relocation of communities. Consequently, the community has no trust in ICE, consistently viewing ICE as the enemy. An analysis of the mediation framework of the stakeholders shows that there was a lot of tension and violence during the planning of the Boruca Hydroelectric Dam Project. Numerous stakeholders, such as the indigenous community, the environmentalists, and the international communal support groups were resisting the construction of the project despite numerous economic and infrastructure opportunities for Costa Rica. The indigenous community’s main resistance to this project was the lack of consultation and the exclusive research and involvement of ICE, which does not include the opinions and/or research of the indigenous members. With due compensation, the members of the indigenous community are ready to assist ICE, but that dialogue has not begun due to ICE’s abstinence

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from dialogues/interactions with the indigenous community. As a result of the exclusiveness of the consultants to the project, the indigenous community built popular support throughout the world on the basis of international law and the conventions that protect indigenous rights and property. This popular support was joined by the environmentalists who believe in the infrastructure development of Costa Rica, but are concerned that ICE’s source of energy may not be the most appropriate source for the environment. The effects of the Boruca Dam Project will include several environmental impacts that potentially could do more harm than good. It is incorrect to assume that the environmentalists are also against this project; rather they are concerned about what ICE is not doing to protect the environment. The last party advocating resistance was the international community that advocated against this project due to the rights the Costa Rica government was trampling on and the international laws signed and upheld in the past as requirements to stop the PH-Boruca. This chapter will illuminate the argument from the resistance group; it will show some of the requirements presented by law to the Boruca Project. Once these factors have been explained, the conflict assessment of the PH-Boruca will conclude with a resolution of the conflict.

Resistance from Local Communities There have been numerous incidents of the violations of the indigenous community throughout history. Costa Rica has continuously failed to uphold its passed laws and abide by international conventions that have been in force to protect the indigenous community. There have been more protests against the power generation project than Costa Rica can handle. The protests have been regarding the potential flooding of towns and land belonging to the indigenous peoples’ ancestors for over 3,000 years. The Asociacio de Desarrollo Integral del Territorio Indigena de Rey Curré stated that ICE has not dealt with this group appropriately. This group also claims that damage has been caused by public officials during the 30 years of planning for this project.139 ICE recognizes the violence and opposition to the dam, and states in their expansion plan (ICE, 2005) that a small reservoir or run of the river hydroelectric development has less impacts. They further conclude that there is more opposition from environmental and neighboring groups that pay more attention to local, sometimes transitory and less relevant impacts, than to the global benefits.140

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In 1977, the government constituted the Indigenous Act and stated that concurrent reservations could be diminished only through passed law. However, the Costa Rican government led the march to decrease four reservations through decrees, not laws. One case other than Boruca is the GuaymI de Conteburica reservation established by Decree No.8514-G, which reduced its 12,558 hectares of land in 1982 to 648 hectares through Decree No.13545 (Dandler et. al., 2005). Similarly, the proposed Boruca Dam Project will not affect the 10,620 population along the Cajón River, but will remove and flood 3,929.40 hectares of land, forcing relocation of people to another region.141 Article 2 of the Indigenous Act states that the transfer of land from nonindigenous to indigenous people will be free and CONAI has the authority to purchase the land back from the current nonindigenous occupants. However, the government has not provided CONAI with the funding to perform this task. Article 7 of the Costa Rica Constitution declares that all international treaties and conventions are of higher authority than domestic law. The ILO Convention 169 is an international convention that must be recognized above the legislation of Costa Rica. However, the government of Costa Rica is not following the explicit commandments of the convention that state that indigenous territories or reservations are protected and cannot be withdrawn, transferred, or sold. Further, the indigenous communities do not like it when nonindigenous peoples trespass and occupy their lands. On many reservations, 80 percent of the land is now occupied by nonindigenous peoples. Article 18 of the ILO Convention 169 states that penalties are levied when there is unauthorized intrusion onto the lands of the indigenous peoples. Indigenous people cannot obtain agricultural credit because the land is communal and since there is no institutionalized consultation, they have no vehicle to express their concerns about the exploitation of their territories.

Resistance from International and Domestic Law Lee Swepston, Senior Advisor on Human Rights for the ILO states: “We also have a responsibility to the 350 million or so indigenous and tribal peoples in the world. [Therefore,] the promotion of indigenous and tribal people’s rights is a subject of endless fascination” (ILO, 2005). His comment was made in the context of a discussion on the commitments to the indigenous community through the International Labour

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Organization Indigenous and Tribal Populations Convention 1957 (no. 107) and Indigenous and Tribal Peoples Convention, 1989 (No. 169) that includes land rights, access to natural resources, health, education, etc. The ILO has continuously been working with communities since the 1920s and is engaged in addressing a wide range of issues pertaining to these peoples. The primary aim of ILO 169 is to ensure the protection and promotion of indigenous and tribal people’s human rights through legislative and policy development (ILO, 2005). Costa Rica is one of the countries that has signed on to pledge their support of the human rights of the indigenous people, but has neglected to support them. In order to fully support the ILO convention, there needs to be domestic law in place that puts emphasis on international laws. In fact, Article 7 of the Costa Rican Constitution states that “public treaties, international agreements (ILO 169 &107) and concordats duly approved by the Legislative Assembly shall have a higher authority than the laws from their promulgation or from the day that they designate” (CERD, 2001). Although legislation is needed to ratify the ILO convention, the ILO convention is a constitution of the customary codification of customary international law that is ius cogens and where there is universal consensus. In the International Convention on the Elimination of all forms of Racial Discrimination it states that the Costa Rica legislation has guaranteed all inhabitants every form of equality, regardless of religion, sex, race, and language, opinions, ethnic origin, or social group (CERD, 2001). In Article 33 of the 1949 Costa Rican Constitution, it states that “all persons are equal before the law and no discrimination whatsoever may be practiced contrary to human dignity” (CERD, 2001). Further, Article 48 states that all people have the establishment to enjoy the rights that are also endowed in their fundamental character as international citizens with human rights. As mentioned in the section “Legal Framework and Policies,” the Constitutional Jurisdiction Act that radically reformed the court system of Costa Rica, not only domestic law is in force in Costa Rica but also “those recognized under international law [are] in force in Costa Rica” (CERD, 2001). Besides the unequivocal support of the IACHR, the constitutional court stated that “human rights instruments in force in Costa Rica not only have similar status to the Constitution but also, in so far as they grant greater rights or guarantees to persons, take precedence over the Constitution” (CERD, 2001). Moreover, the most important law is the Indigenous Act of 1977 that covers the character of the indigenous communities, ownership of

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reservations, organizational structure of indigenous communities, formalities of compensation, means to prevent invasions of lands, and the preventions of exploitation of natural resources (CERD, 2001). These laws, both internationally and domestically, have been cofounded for the protection and promotion of indigenous rights and property, yet the allegiance from the government has been poor. The international community pledged these laws as a basis to prevent the construction of the dam project, to prevent the loss of ancestral land, and to prevent the loss of identity and race. Water for People and Nature stated that “big dams are destructive.”142 The dams have been uneconomic, unfair, and have led to the displacement of more than 60 million people in the world. The organization that advocates for water believes a dam will not provide any benefits to the indigenous people; rather it will hurt the supply and displace their population. As stated in a declaration from the Third National Indigenous Congress: For us, Indian Peoples, our Mother Earth is sacred, and so are all the beings which inhabit her. They are not a commodity which can be bought or sold. For this reason, we cannot accept the destruction of our territories through the imposition of mega-projects by federal and state governments in our various regions throughout the country. We demand a moratorium on all projects that involve bio-prospecting, mining, water mega-projects, and all bio-piracy activities taking place in our lands and in our country, until the Indian Peoples have discussed in their own time the issues related to the control of their resources.143

Conflict Resolution The mediation framework supported a conflict assessment of the Costa Rica Boruca Hydroelectric Project. Evaluating the positions, interests, and needs, the government seemed to have come to the conclusion that the Boruca Dam Project was not the most appropriate solution and a smaller dam will be pursued (see “Conclusions about the Boruca Dam” in this chapter). The conflict resolution showed dialogue and negotiation between ICE and the indigenous community. An analyst could conclude from this framework and the violence caused by this project that a lot of miscommunication and misunderstanding existed. Both parties want the same things; their needs are similar, but they communicate differently.

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It is interesting to note that poor communication has continued this battle for over 30 years, while millions of dollars were invested. The poor communication took place because there was no dialogue, no opportunity to sit down and discuss each other’s stories and opinions. These stories had to be collected over years of debate and media reports. Listening is an important part of communication and this matter could have been resolved earlier if that forum for dialogue had been available to the parties. It is as a result of this dialogue and this understanding that the Legislative Assembly is working on a draft to replace the Indigenous Act with the direct opinions from the indigenous community. The new legislation proposes the reservations as territories and contains 51 articles of rights for the indigenous peoples. Unfortunately, it has yet to be accepted by the Assembly and until the Costa Rican government accepts this draft, upholds ILO 169, appreciates the indigenous rights, and facilitates more opportunities of dialogue and communication, there will always be conflict between the indigenous people of Costa Rica and the Costa Rican government. It is hoped that by reading this analysis, a better understanding of assessing conflict and resolving violence can be learned.

Conclusions about the Boruca Dam During the decade of the 1970s, the first studies and proposals for constructing the PH-Boruca were made. During that time, the development of the Boruca Project was linked to satisfying the energy needs of ALCOA, a transnational company that was trying to exploit aluminum in the south of Costa Rica. The planned location of the dam was in the “Cajón de Boruca.” In 1970, the Legislative Assembly of Costa Rica approved law No. 4562, which gave ALCOA the right to exploit the bauxite deposits of the “Valle del General” for the next 25 years, with a possible extension of another 15 years. This law mobilized the opposition of the Costa Rican people and since then there was neither consensus nor national unity for developing the dam with the consequence that the project got stuck. In 1980, the results of a new study were published which was developed by the Canadian Syndicate SNC/ACRES/TECSUL and ICE analyzing the possibility of developing the Boruca Project in two phases: **—The first phase to supply the national consumption by constructing a reservoir located at 170 m.a.s.l. and a production of 460 MW. —A second phase to supply possible industrial consumers, elevating the level to 290 m.a.s.l. with an approximate production of 1,520 MW.

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This design was named “The Great Boruca Project” and the storage lake was planned to cover an area of 25,000 hectares. Due to a series of unknown circumstances, the project was not realized. In 1993/94 a Japanese company, Nippon Koei Co., reevaluated the studies from 1980 and proposed the possibility of selling the energy produced by the dam to Mexico. Finally, in 2001, ICE developed a new study of the hydroelectrical potential of the “Rio Grande de Térraba” watershed, which included project options at different levels between 160 and 290 m.a.s.l. During that period, a multiple criteria analysis was introduced, a methodology that allows comparing between different options while taking into account the cost-benefit ratio and possible environmental impacts of the project. However, the Boruca Project would still have a great impact on the infrastructure, the ecology, and the people located in the region. In view of this situation, ICE continued to look for the best option and, in 2004 employed a Columbian company to carry out an “Environmental Impact Study” regarding the feasibility of the Boruca Project. Concluding, the Boruca Dam would cause the flooding of approximately 25,000 hectares of land, including sections of the Inter-American Highway, a most significant part of Rey Curré Indigenous Reserve, and sections of the indigenous reserves of Térraba and Boruca. It would also affect other indigenous reserves, with an influx of people and infrastructure development for the project. This raised a series of issues and concerns for the affected communities, including loss of their land, forced resettlement, and fundamental issues of indigenous rights, land titling, and the environmental impacts of the project. PH-Boruca was riddled with technical uncertainty, uncalculated costs, and environmental and social threats, harsh topography, proximity to fault line, and deforested watershed. In addition, the construction of the dam would alter the flows of the Térraba River and would have large impacts on the Térraba–Sierpe mangroves that are fed by the river system. It appears that the conflict management process involving the question of whether or not to build the dam has been skipped or eliminated and some of the actors have gone directly to the bargaining phase. Because other actors, especially the people of Rey Curré, refuse to participate in this negotiation, it appears that appropriate conflict management techniques have not been applied to resolve the issue or at least the techniques applied have been unsuccessful. It is also important to involve the stakeholders involved in the decisionmaking process regardless of which conflict management process will be

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used. This unfortunately has been only partially the case in the past. Stakeholders, in particular indigenous people, have had little opportunity to give their input regarding how the conflict process should be managed. ICE’s self-criticism in planning, with its causes and effects, shows the weaknesses of the project in detail (Figure 3.6). Weak Community Aid Some organizations oppose the Development of PHB Unsatisfactory Relationship with Community

Weak social group

ICE group weak on negotiating

Inadequate channeling of information

Strategies of community disinformation

Different discourses

No single No work Insufficient channel in the internal E of group cooperation commu- F nication F E C Social and NonT No board with Inappropriate Duality Insuffiunified Project’s environS a shared of information cient mental organi- lack of vision to demonstrate internal funds zation definition feasibility to manage the the need for criteria for PHB for PHB not PHB guaranteed communities NonThe country systematic is not techniques convinced for of the environmental necessity management for PHB

Absence of formal mechanisms for community interaction

There exists no universal shared strategy for the project

No clear model for country’s development of its electricity market

No clear The need for Complexity definition who and function of of integration will build this an indefinite of diverse market and project interests for what involved

Source: ICE, 2002

Figure 3.6 Strategic Weakness of Project Boruca

Central problem

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Relocation of Peoples Archaeological Patrimony

Regional Development

Legal Aspects Bio-physical Aspects

Source: ICE, 2002

Figure 3.7 Strategic Areas of the Project

The strategic areas of the project are outlined in Figure 3.7, among others the relocation of people, archeological patrimony, and regional development aspects, but finally ICE itself reached the conclusion144 that “a shared-project global strategy does not exist.” In an “Opinion Poll and Positions of Indigenous Groups and the Region on the Boruca Project,”145 the following main conclusions, among others, were drawn: z

z

z

ICE is not clear on the social management of the Project. Its method of working with the communities and regional social actors is in reality not applicable, because it does not contemplate active participation by civil society, and because ICE uses political means of confrontation between sectors and excludes groups lacking political and economic representation and lacking a method for negotiating in those terms. It is believed that there are differing positions within ICE that became evident in their meetings and were corroborated shortly after when published in the national press. The result has been ICE management’s loss of credibility in the region. The indigenous as well as environmental sectors consider ICE to have failed in not making studies on the possible social and environmental impacts of the dam available at an earlier time and studies that hide information because ICE fears that the magnitude of the negative impacts will be known.

108 z

CONFLICT RESOLUTION OF BORUCA ENERGY PROJECT

The National Program for Rural Development (PDR—Programa de Desarollo Rural) recommends the creation of forums and offers their experience in managing citizen participation. The PDR believes that ICE on its own will not be able to handle the complexity of the project at the social and economic level, and that the creation of alliances with regional institutions would be important for them.

Another important conclusion is that the Government of Costa Rica is neither obeying the Indigenous Law (Law No. 6172 of e November 29, 1977) nor the Convention Concerning Indigenous and Tribal Peoples in Independent Countries (Law No. 7316 of November 3, 1992), better known as Convention No. 169 of the International Labour Organization (ILO). In addition, the Government of Costa Rica would be failing to obey the International Convention on the Conservation of Wetlands,146 better known as “The Ramsar Convention,” since, in the case of building the PH-Boruca, the Térraba River would be divided, and the ecosystems there today would be irreversibly affected. Examples are the famous TérrabaSierpe Wetlands, the large Ramsar Site off the Pacific Coast of Costa Rica (30.654 hectares), and one of the main groupings of mangrove swamps in Central America. In the phase of construction, it would be necessary to move houses and other types of productive and social infrastructure to the construction sites of the dam, the tunnels, the operating plant, the camp sites, and the new roads. In this phase of operation, the dam will be flooded with water, forcing the displacement of the dispersed indigenous populations of Térraba and Cabagra. Displacement would have a high cost in the medium term because the social conditions that existed previously where the indigenous peoples lived would have to be recreated. They could even be relocated to houses of an unfamiliar architecture (urban), in small lots, and in a more concentrated form than the present one. Resettlement projects normally do not take into consideration in their design the social and cultural ordering of the space of the previous town, breaking the networks of social solidarity that existed therein.147 Displacement would cause uncertainty, fear, and sadness in people when leaving very dear places and moving to new ones. The pit in which their children’s umbilical cords, alongside those of their ancestors, were buried; recreation sites like the town square and the river; public places and the burial sites of their dead will be lamented by several generations. What is lost is the microcosm, crucial in rural societies and even more so in indigenous ones.

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Within the socioeconomic context, the following important conclusions have to be emphasized: z z z z z

Land-possession problems Loss of natural resources Lack of employment Regional development Reaction of the people in the face of the existing dam.

Since the date of the creation of indigenous territories until today, the situation regarding land possession has become increasingly chaotic. First, a high rate of deforestation has occurred, especially in the territories of Boruca, Rey Curré and Térraba, following the territories of Salitre, Ujarráz, and Cabagra. Later, a land invasion occurred on the part of nonindigenous people until, according to the indigenous organizations, only 54 percent of the land in Boruca remained in the hands of the indigenous peoples, and only 15 percent in Térraba. This data squares with the results of the 2000 Census done by INEC,148 the National Census Bureau. Additionally, even though the indigenous reserves of the Buenos Aires canton were first in being declared, those of Boruca, Térraba, and Curré have not been able to obtain communal titles, by which the respective development associations interposed a shelter resource before the Sala IV, obtaining a favorable ruling. The Indigenous Law demands that the government, through the CONAI, defend the inalienability and exclusivity of land for indigenous peoples, but, instead of complying, CONAI keeps increasing the number of nonindigenous people in the indigenous territories. As a result, many families no longer have space to cultivate land or to build homes, and thus have to migrate, so that—according to the 2000 Census—today, almost 50 percent of the indigenous population lives outside their territories.149 Historically, this has degenerated into a series of social conflicts that prevent having suitable forms of land ownership, which in turn degenerate into situations of social exclusion and dislocation. The indigenous people become very attached to the colonial patterns of the nonindigenous peoples in which a historical reclamation of local ethnic groups is pronounced, as protected by ILO Convention No. 169, The Organization of American States’ (OAS) Universal Declaration of Human Rights, represented by the OAS Charter, the American Declaration of the Rights and Duties of Man, and American Convention for Human Rights. Perhaps the most evident effect and impact of this indiscriminate use of lands, from an environmental perspective, has been forest destruction.

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This implies, among other things, the alteration and contamination of aquifers,150 hunting and the elimination of habitats, the destruction and looting of sacred sites (grave-robbing), illegal timber commerce, and in general, the almost irreversible deterioration of the Grande de Térraba River Basin. This is in addition to the destruction of flora and fauna that creates a complex network of benefits, such as the traditional medicine and foods of the indigenous people.151 The expressed indicators account for the difficulty in possible job creation, especially when farming dynamics show a lagging tendency and other economic sectors do not keep pace with demand. Some of the most important characteristics for more in-depth analysis are the ties of nonagricultural employment as family sustenance in rural confines. Employment and rural nonagricultural income are considered fundamental elements to the survival strategy of a rural environment. It is suitable to identify processes of socioproductive regeneration and reconversion that provide a sense of ownership and identity to the peoples potentially affected by PH-Boruca. PH-Boruca could act as an impelling factor in economic development, even though the efforts of the State to reactivate the regional economy have not come to fruition.152 Finally, the area’s industry is limited and is concentrated in artisan activities and small industry. Commercial activity is concentrated in ventures such as restaurants, bakeries, and the like, located mainly in the most important urban centers. Concluding there are some crucial questions to be answered, such as: z

z

z

If PH-Boruca were to become a factor in regional development, would the principal local and regional organizations be able to administer the consequent installation and operation processes? Would the State have to arrange necessary resources so that these systems operate the project under novel dynamics of coadministration and legal schemata that privilege the interests of these intercommunitarian systems or under communitarian models of social participation? Does sufficient public investments in other areas of the regional economy exist, which could bring about the recovery and necessary socioeconomic dynamics for the bulk of the population with a view to eliminating rural poverty?

Summarizing, the problems and social and environmental impacts of large dams are evident in several documents. “Large dams have fragmented and transformed the world’s rivers. It is estimated that between

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40 and 80 million people have been moved by their construction. In many countries, [while] the measure by which the bases for decision making have become more open, inclusive and transparent, the decision to construct a large dam has become increasingly controversial, to the point where the future large-dam construction is today questioned in many countries of the world.”153 After several years of rigorous studies, of reflection, and of dialogue with those who are in favor of and opposed to large dams, the WCD (2000) believes that there exists no justifiable doubt about the following four basic points: z

z

z

z

Dams have contributed in an important and significant way to human development, and the benefits derived from them have been considerable. In too many cases, an unacceptable price has been paid for obtaining these benefits, and frequently unnecessary, especially in social and environmental terms, on the part of the moved people, the communities down river, the financial contributors and the environment. Comparatively with other alternatives, the lack of fairness in the distribution of benefits has put in question the value of many dams when it comes time to satisfying the necessities of water and energy for development. When including in the discussion all those whose rights are involved and that run the risks associated with the different options for the development of the water and energy resources, the conditions for a positive resolution of conflicts between opposing interests are created.

In terms of social impacts of dams, the WCD154 found that frequently, “negative effects were not given any value nor were they taken suitably into account. A great deal of impact exists that includes the lives, subsistence means and health of the communities that depend on river environments affected by dams.” Experience indicates that it is most likely that the poor people, other vulnerable groups, and future generations disproportionately bear the social and environmental costs of large dams without gaining a corresponding part of the economic benefits, such as the following: z

Tribal indigenous groups and vulnerable ethnic minorities have disproportionately undergone displacements and experienced negative impacts in the way of subsistence, culture, and spirituality.

112 z

z

CONFLICT RESOLUTION OF BORUCA ENERGY PROJECT

Affected populations living near dams, the displaced people, and the communities down river have all faced health problems and negative consequences to their means of subsistence due to environmental and social changes. Among affected communities, disparities between the sexes have themselves increased and women have frequently born the disproportionate brunt of the social costs, and have been discriminated against when it comes time to sharing in the benefits.

If ICE wants to act with transparency and credibility to ensure that the people of the Boruca area would believe them in their offer of mitigation measures regarding the social and environmental impacts that will be caused by PH-Boruca, they must first evaluate and question whether what they offered to the communities of Turrialba with the Angostura Dam Project was fulfilled or not. Verification is lacking regarding the fulfillment of ICE’s environmental commitments. An independent environmental audit is important for clarification and to ensure that there are no doubts. Angostura will be a reflection of what might happen in Boruca. Owing to the preoccupation over the social and environmental impacts of PH-Boruca, it has been proposed that ICE take into account the following considerations: z

z z z z z

z

Use an analysis of the implications which recognizes the rights of all parties and present an evaluation of the risks in a format that is both clear and transparent. All affected groups have the right to be informed and to participate in the processes. A distribution analysis is recommended to see who participates in the costs and benefits of the project, and how these are shared. Define the measures of mitigation and resettlement that must be taken, with participation from those involved. All serious and irreversible impacts must be avoided on the ecosystem. This can be achieved with modifications in the dam design. Compensatory measures must be established regarding environmental and social impacts. Complaint mechanisms must be put in place along with mechanisms to ensure the fulfillment of commitments. PH-Boruca will need credibility, transparency, and a correct system of environmental verification. Environmental management systems in PH-Boruca need to be established.

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Finally, after the 30-year process of planning the Boruca Dam with all the problems and conflicts discussed in detail above, underlined by an increasing national and international pressure against the dam, the idea to build the dam as originally planned was dropped by ICE. Taking the dimensions of sustainable development into account and evaluating carefully the cultural, socioeconomic, and ecological impacts ICE decided to build a smaller dam in the region named “Project El Diquís” (ICE, 2007).

Project El Diquís The new option identified consists of a dam located 4 kilometers upriver of the bridge that crosses the Río General in the vicinity of El Brujo. It is provisionally known as the Veraguas Hydroelectrical Project, because the dam would be located close to a river called Veraguas, which flows into the Río General Superior (see Map 3.1). In 2006, ICE organized a competition in cooperation with the Ministry of Public Education in order to find a definitive name for the Project. This competition took place among the schools of the cantons of Osa and Buenos Aires. The jury has chosen the name El Diquís, by taking into account that the name makes reference to a geographical area that unites historical, geographical, social, and cultural elements that are representative for the region in which the hydroelectrical project will be built. The design of the project offers many advantages in comparison to the option of the project located in “Cajón de Boruca” as far as the size of the area flooded, relocation of people, number of archaeological sites affected, and finally the costs involved (Table 3.1). Therefore the “El Diquís Project” has been chosen as the hydroelectrical development alternative in the watershed of the Río Grande de Térraba, discarding the option known as the “Boruca Hydroelectrical Project” (ICE, 2007). This means that ICE has changed its way of conceiving hydroelectrical projects. The “El Diquís” alternative considers the socioenvironmental impacts as very important. The new motto is, “Let’s produce electricity, but only while safeguarding that communities and nature receive as little impact as possible” (ICE, 2007). The water will be channeled into the Río Grande de Térraba through a subterranean tunnel of 13 kilometers at a place located 2 kilometers west of the city of Palmar.

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Table 3.1 General Attributes of the El Diquís Project Power

631 MW

Average generation

3,050 (GWh*/year)

Total area of the storing lake

6,002 hectares

Height of dam

179 meters

Approximate cost

$ 979 million

Impact on Panamerican Highway

3.6 kilometers

Flooding of non-indigenous territory

5,866 hectares

Relocation of total population

1,068 persons

Relocation of nonindigenous population

1,068 persons

Relocation of indigenous population

30 families **

Reduction of the total area of the Térraba–Sierpe mangroves

1.5% (315 hectares)

Number of archeological sites affected

108

Area of forest flooded

600 hectares

*GWh: Giga watts hour. **Information obtained through socioeconomical poll. Subject to being verified in current studies. These families live outside of indigenous territory.

Map 3.1 El Diquís Hydroelectric Project

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The level of the reservoir will vary between 260 and 300 m.a.s.l., which would result in a waterfall of approximately 250 to 290 meters, which in turn would produce enough pressure to generate around 608 MW (ICE, 2007). The advantage of this fall is that there will be a lot of pressure without a lot of water required in order to make the turbines work, which allows an efficient use of the water resources. On the other hand, a stream of compensation, carrying a minimum of 16.7 cubic meter of water per second, leading into the Río General would be implemented at the site of the dam (more water than the minimum registered in this stream during the dry season), which would be used for producing an additional 23 MW. Apart from that, a maximum height of 310 m.a.s.l. of the dam will be considered in order to prevent any extraordinary flows of the Río General. The Diquís Project would therefore produce electricity of a total of 631 MW (ICE, 2007). The Diquís Hydroelectric Project would be the biggest in Central America, unless a hydroelectrical project of 660 MW is built in Nicaragua, which has been under study, but has not been defined until recently. The project ensures that electrical energy would be available in the country and would represent a key factor in satisfying the electricity needs of the next 20 years. Furthermore, there is the possibility of an external market by supplying energy in the rest of Central America during the first years of operation of the power plant. This would be necessary to finance the project, although its primary object would not be the export but local consumption. Thus, the excess of power available at the beginning would be reduced gradually according to the consumption in the country, until encompassing all of the energy produced by the project. Because of its magnitude the construction of this hydroelectric plant would carry a series of implications for the environment and the socioeconomic dynamics of the region, which need to be addressed in order to minimize its adverse effects and maximize the positive ones.

Implications for the Road Infrastructure The storage lake would flood a small part of the Pan-American Highway. The relocation of this part of the road would imply the construction of a stretch of 4.3 kilometers, which would not only significantly reduce the cost of the infrastructure but also reduce the ecological impact due to destruction of plants, removal of earth, and possible deterioration of archeological sites.

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Furthermore, the construction of a bridge of 1,250 meters would promote the touristic attractiveness of the area. On the other hand, the territory of the Indigenous Reserve of Térraba would be partly affected.

Implications for the Térraba–Sierpe Wetland About 16 kilometers before the wetland, the water stream coming via the Río Térraba and the stream used by the hydroelectrical plant would join each other. During the rainy season, the quantity of water released by the hydroelectric plant would be slightly less than the quantity carried by the river, which would result in mitigating the water quality the plant would release. But during the dry season, exactly the opposite would happen, the volume of water released would be more than the volume of the stream of the Térraba Another aspect that is being studied refers to the quality of the water after travelling 13 kilometers through the tunnel. It is known that the discharged water would have a lower temperature than the water of the dam reservoir. However, a series of readings taken in different rivers of the watershed of the Río Grande de Térraba has shown differences of up to 9ºC, which suggests that this phenomenon would not have severe implications. On the other hand, it is also known that on passing through the turbines, the quantity of oxygen in the water increases substantially. But, in the case of the El Diquís Project, the water needs to travel almost 3 kilometers within the tunnel before reaching the river. Experts do not foresee a greater problem of water quality in the discharge because the project design includes, as a means of mitigation, the construction of a channel of 160 meters wide and 1 kilometer long, which would allow for a temperature increase and obtain a normal oxygenization level before returning to the Río Grande de Térraba. Finally, it is important to point out that the construction of this dam would retain approximately 55 percent of the total water stream of the Río Grande de Térraba. The remaining 45 percent would continue to drain directly into the estuary. Therefore it is expected that the impact on the Térraba–Sierpe wetland would be moderate. The El Diquís Project could potentially affect the productivity of the wetlands nourished by the water of the Río Grande de Térraba. However, in order to minimize the effects considered, mitigation and compensation measures are being planned that would help to reduce the impact of losing 315 hectares (1.5 percent of the total of the Térraba–Sierpe

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Wetland). These impacts could be compensated by recovering sectors of the mangroves.

Implication for the Communities The dam would flood around 610 hectares of the indigenous territory of Térraba and 47 hectares of the China Kichá territory, but no indigenous population would be affected. There are still some detailed studies that need to be made to determine the total of the population that would be affected by the dam. It is estimated that the El Diquís Project would affect around 1,068 people and 9 villages would be flooded, affecting around 237 houses in total. The communities of El Ceibo, including the land located on the right side of the river, Las Pilas, Bajo Las Pilas, Remolino, Llano Grande, La Gloria, La Tinta, Ocochovi, and parts of Colinas would have to be relocated. In any case, the territories affected would be compensated according to the agreements made with the villages affected, which would include variables such as history of the colonization process, current production activities, system of landownership, distribution of the land, and its community expectations.

Implications with Regard to the Use of the Río General It is important to take into account that the Río General constitutes a natural barrier between its two shores that can be reached only by boat. Therefore, the dam would not change the physical situation substantially; it would only make the navigable stretches longer in order to get from one point to the other. On the other hand, the irreversible loss of cultural places along some stretches of the river must be considered.

Implications for Productive Activities The dam and its construction would bring along changes in land use that would affect productive activities. In the case of agricultural activities, it is estimated that approximately 582 hectares of the perennial crops, 245 hectares of seasonal crops, and 4,657 hectares of pasture land for live stock would be affected (ICE, 2007). There are only a few industries located in the area of the project. The pineapple company, PINDECO, is an exception. Its extension reaches the area of Paraíso close to the site of the dam. It is most likely that some

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of the pineapple plantations would be affected. The flooding of the Río Ceibo would affect some pineapple plantations as well.

Generation of Employment The construction of the dam will have an immediate impact on employment since a greater quantity of workers and services would be required over a period of several years. It is important to state that once the construction would be in its final stage fewer employees would be required meaning a parallel economy needs to be developed avoiding an exclusive dependency on the hydroelectric project’s development. It is absolutely necessary that the communities organize themselves accordingly, that they contribute proposals and set in motion their own development strategies in order to strengthen the local economy. The hydroelectric project could contribute to the development of the communities in the region.

Investment Attractiveness due to an Improved Infrastructure At present, the El Diquís Project would be one of the few initiatives that would promote an investment of significant magnitude in the southern region of Costa Rica. This investment would support, together with other governmental and private investment options, the strengthening of the regional economy, the creation of employment, new service offers, and the improvement of the local market in terms of production and commercialization of products from the region.

Touristic Development and Other Economical Activities The creation of a big lake could represent a factor that might attract resources through tourism. The real potential is still under study. The oscillation of the water level between the dry and wet season and a very rough topography could represent an obstacle for developing touristic activities around the reservoir. The development of any touristic activity should go hand in hand with an integral management plan of the region.

Implications for the Management of the Watershed At present, the watershed has some serious problems, excessive deforestation, pollution due to an excessive use of agrochemicals, slash and burn

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agriculture, and others. This situation provokes a lot of erosion, which results in an excessive production of sediments that reach the estuary of the Río Grande de Térraba. This greatly impacts the river. Likewise, the creation of sediments caused by erosion would diminish the storage capacity of the dam. In order to mitigate these problems, a containment area would have to be created, which would be allocated for reforestation activities. It would also promote the improvement of agricultural practices, that is, replacement of chemicals, recycling and utilization of garbage, and promotion of organic agriculture. Apart from these measures, ICE together with other institutions, companies, and people from the region, would actively participate in promoting an adequate management of the watershed in order to guarantee the availability of the region’s natural resources.

Implications for the National Electricity System The El Diquís dam would make it possible to produce energy all year round, even during the dry season. Furthermore, it would make the national electricity system more stable. This is also due to the fact that all the electrical power plants are located in the central or northern regions of Costa Rica, but there are no plants that generate power in the southern region. All the energy that arrives via transmission lines in the southern region comes from the central region, which makes the system very unstable. In its current state, it is susceptible to voltage fluctuation, interruption of supply, and energy losses. With a power plant in the southern region it would be possible to create new transmission lines, by forming new “rings” of transmission in the region, and thus providing a greater stability of the system and a better quality of service.

Control of the Flooding in the Lower Parts of the Watershed The El Diquís Hydroelectric Project would have a regulating effect on the higher levels of the river flow of the Río General. The risk of flooding would be diminished. Flooding has been a problem in some areas in the past. Currently, the average yearly flow of water of the Río General, before meeting the Río Coto Brus, is 182.3 m3/s (cubic meters per second). This means that the dam would make it possible to regulate and control approximately 55 percent of the water flow of the Río Grande de Térraba watershed.

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Implications for the Archeological Heritage The data supplied so far indicate that the dam would affect around 108 archeological sites of varying importance. Decisions on how to manage the archeological resources would be coordinated together with the National Archaeology Commission (CAN) and the National Museum of Costa Rica (MNCR).

Perspectives The El Diquís Hydroelectric Project still requires in-depth studies on the design and environmental impacts, which finally will contribute to a complete study on the feasibility of the project. It is expected that these studies will be concluded before the end of 2009. At that time a clear decision on the feasibility of the project will be made, including a possible permission to build the dam from the National Secretary’s Office of Environment, SETENA.

Endnotes 1. Centro Cientifico Tropical, 1975. “Estudio Ecologico: Proyecto Boruca,” San Jose, Costa Rica. 2. Babbar, Liana, 2003. Personal Communication, San Jose, Costa Rica. 3. CCT, 1975. 4. Bonilla, Alexander, 2003. “Proyecto Hidroelectrico de Boruca: Implicaciones Sociales y Ambientales,” San Jose, Costa Rica: Radio Monumental. 5. “Candidatos Impulsan Boruca,” La Nacion, San Jose, Costa Rica March 6, 2002. 6. ICE, 2002. 7. Ibid. 8. INGETEC, S.A. is an engineering consulting firm headquartered in Bogotá, Colombia. For more information, see www.ingetec.com.co/. 9. ICE, 2004. 10. “Proyecto Hidroelectrico Boruca se Traslada”, Diario la Republica, December 11, 2004. 11. Bonilla, A., 2003. 12. Cadastre: A register of property showing the extent, value, and ownership of land for taxation purposes. 13. MIDEPLAN, 2002 “Plan Nacional de Desarollo de los Pueblos Indigenas de Costa Rica”, San Jose, Costa Rica. 14. Asociación de Desarrollo Integral (AID).

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15. Convention concerning Indigenous and Tribal Peoples in Independent Countries (1989) also referred to as the “Indigenous and Tribal Peoples Convention.” 16. Law No. 7319 December, 1992. 17. ICE, 2004. 18. Ibid. 19. Ibid. 20. Herrera, Berlioth, “Sindicatos Anuncian Protestas por Ley del ICE”, La Nacion, San Jose, Costa Rica, September 16, 2005. 21. Herrera, B., 2005. 22. International Covenant on Civil and Political Rights, G.A. res. 2200A (XXI), 21 U.N. GAOR Supp. (No. 16) at 52, U.N. Doc. A/6316 (1966), 999 U.N.T.S. 171, entered into force Mar. 23, 1976. 23. International Covenant on Economic, Social and Cultural Rights, Adopted and opened for signature, ratification and accession by General Assembly resolution 2200A (XXI) of December 16, 1966, entry into force January 3, 1976. 24. American Convention on Human Rights, O.A.S. Treaty Series No. 36, 1144 U.N.T.S. 123, entered into force July 18, 1978. 25. Additional Protocol to the American Convention on Human Rights in the area of Economic, Social and Cultural Rights, “Protocol of San Salvador” done at San Salvador November 17, 1988. OAS Treaty Series 69. 26. Charter of the United Nations at San Francisco on June 26, 1945 entry into force October 24, 1945 in accordance with Article 110. 27. Universal Declaration of Human Rights adopted and proclaimed by General Assembly Resolution 217 A (III), December 10,1948. 28. UN General Assembly “Declaration on the Right to Development,” adopted by General Assembly resolution 41/128 of December 4, 1986. 29. Convention (No. 169) concerning Indigenous and Tribal Peoples in Independent Countries, Adopted on June 27, 1989 by the General Conference of the International Labour Organization at its seventy-sixth session, entered into force on September 5,1991. 30. World Rainforest Movement, “Costa Rica: Indigenous Territory Threatened by Hydroelectric Dam,” World Rainforest Movement (WRM) Bulletin No. 46, May, 2001. 31. World Rainforest Movement, “Costa Rica: Opposition to Hydroelectric Dam,” World Rainforest Movement Bulletin No. 52, November, 2001. 32. WRM, November, 2001. 33. ILO Convention 169, 1989. 34. United Nations, “Declaration on the Right to Development,” 1986. 35. United Nations, “Declaration on the Rights of Indigenous People (DRIP),” 2007. 36. Ibid.

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37. ILO Convention No. 169, 1989. 38. United Nations, DRIP, 2007. 39. Economic Social Council, “Inter-Agency Support Group on Indigenous Issues Report on Free Prior and Informed Consent,” United Nations Permanent Forum on Indigenous Issues, Third Session, New York, NY, May 10–21, 2004. www.un.org/esa/socdev/unpfii/pfii/documents/other%20docs/Doc%20 Report%20on%20FPIC.htm. 40. Economic Social Council, 2004. 41. United Nations, DRIP, 2007. 42. Ibid. 43. ILO Convention No. 169, 1989. 44. Ibid. 45. WRM, November, 2001. 46. CEDIN, 2002. “Preidentificacion de Efectos del P Boruca Sobre Poblaciones Indigenas,” Separate Print of CEDIN, Buenos Aires, Costa Rica:CEDIN. 47. United Nations, DRIP, 2007. 48. Schulting, Gerard, “Indigenous Peoples in Costa Rica: On the Road to Extinction?” ILO Convention No. 169 in Latin America, Vol. No. 4, Fall, 1997. Abya Yala News saiic.nativeweb.org/ayn/crilo.html. 49. Instituto Nacional de Estadisticas y Censo (INEC), Estadisticas Nacionales, San Jose, Costa Rica, 2000. 50. Coto, F, 2004. “El Movimiento Indigena, El Papel del Estado y la Participacion de Otras, Entes Locales, Regionales, Nacionales e Internacionales en la Dimension del Proyecto Hidroelectrico de Boruca,” Buenos Aires, Costa Rica. 51. WRM, November, 2001. 52. Food First Information Action Network (FIAN) International Secretariat (ed.), “Justiciability of Economic, social and Cultural Rights,” The Right to Food Journal, 2003. 53. The Mayagna (Sumo) Awas Tingni Community v. Nicaragua, Judgment of August 31, 2001, Inter-Am. Ct. H.R., (Ser. C) No. 79 (2001). 54. Sepulvda, M. et al. “Universal and Regional Human Rights Protection Cases and Commentaries,” San Jose: University for Peace, 2004. 55. Carver, Richard, “International Law”, 2001. http://www.aceproject.org/main/ english/me/mea01.htm. 56. WRM, May, 2001. 57. Ibid. 58. United Nations, “International Covenant on Economic, Social and Cultural Rights (ICESCR),” 1976. 59. United Nations, “International Covenant on Civil and Political Rights (ICCPR),” 1966 and ICESCR, 1976. 60. Ibid. 61. United Nations, DRIP, 2007.

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62. Ibid. 63. Ibid. 64. Rights and Democracy, 2002. www.dd-rd.ca/site/publications/index.php? id=1351&page=2&subsection=catalogue. 65. Ibid. 66. Daes, Erica-Irene A. “Statement on Indigenous Peoples’ Permanent Sovereignty Over Natural Resources,” The Second Session of the Permanent Forum on Indigenous Issues, New York City, NY, May 20, 2003. http://www.treatycouncil.org/ section_2113151111422211111.htm. 67. ILO Convention No. 169, 1989. 68. Ibid. 69. Ibid. 70. Ibid. 71. Ibid. 72. United Nations, DRIP, 2007. 73. Schulting,1997. 74. WRM, November, 2001. 75. World Commission on Dams, November, 2000 “Dams and Development: A New Framework for Decision-Making,” The Report of the World Commission on Dams, London and Sterling, VA: Earthscan Publications Ltd. 76. SIEPAC, Central American Electricity Interconnection System, 2004. 77. World Bank, “Profile of the Indigenous Peoples of Costa Rica,” 2000. 78. Association of World Citizens, “A Human Manifesto” reissued 2002. http:// www.worldcitizens.org/manifesto.html. 79. UNEP, 2006 . GEO Yearbook: An Overview of Our Changing Environment, , Nairobi: UNEP’s Division of Early Warning and Assessment. www.unep.org/ geo/yearbook/yb2006/PDF/Complete_pdf_GYB_2006.pdf. 80. WCD, “UK Government Checklist on WCD Compliance,” November 5, 2007. http://internationalrivers.org/en/way-forward/world-commission-dams/ uk-government-checklist-wcd-compliance# attachments. 81. WCD, 2007. 82. Instituto Costarricense de Electricidad (ICE), 2002 a. “Estrategia del PH Boruca—Dimension Tecnica, Organizativa y Etorno,” San Jose, Costa Rica: ICE. 83. Manifesto, 2002. 84. National Congress of American Indians, “Tribal Populations and International Banking Practices: A Fundamental Conflict Over Development Goals,” June 29, 1983. http://www.cwis.org/fwdp/international/bankpoly.txt 85. SIEPAC, 2004. 86. ICE, April, 2002 “Sondeo de Opiniones y Posiciones—Area de Influencia del PH Boruca,” San Jose, Costa Rica: ICE. 87. Arcadia Field Analysis, International Peace and Conflict Resolution, 2007.

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88. Baxter-Neal, Leland, “Officials Review Boruca Hydroelectric Proposal,” the Tico Times. american-european.net/blogs/costa-rica-news/business-andeconomy/2006/05/25/officials-review-boruca-hydroelectrc-proposal/. 89. Arcadia Field Analysis, 2007. 90. Baxter-Neal, L., 2006. 91. Arcadia Field Analysis, 2007. 92. Baxter-Neal, L., 2006. 93. Arcadia Field Analysis, 2007. 94. Ibid. 95. Baxter-Neal, L., 2006. 96. Arcadia Field Analysis, 2007. 97. Ibid. 98. Ibid. 99. Ibid. 100. Ibid. 101. ICE, 2002 a. 102. Collaborative Learning Projects & The Collaborative for Development Action, Inc. (CDA), Do No Harm Project, 2005. http://www.cdainc.com/cdawww/ default.php 103. ICE, 2002 a. 104. Ibid. 105. Ibid. 106. Ibid. 107. Ibid. 108. SIEPAC, 2004. 109. Casino Jazz, “Indians”, Costa Rica People, Interview with Jose Carlos Morales Casino, Jazz News, 2007, www.casinojazz.com/news/cr-people.php 110. Schmidt, Blake, “Indigenous People Travel to Capital for Protest”, the Tico Times Online, San Jose, Costa Rica. August 30, 2006. http://www.ticotimes. net/dailyarchive/2006_08/daily_08_30_06.htm#story1 111. Programs in the Americas, December 1, 2004, Global Exchange (GEX), June 7, 2005, www.globalexchange.org/countries/americas/mexico/ppp/ppp.html. 112. SIEPAC, 2004. 113. Ibid. 114. Ibid. 115. ICE, 2004. Contexto Socioeconomico y Cultural del Proyecto Hidroelectrico Boruca, Buenos Aires, Costa Rica: ICE. 116. Instituto Nacional de Estadisticas y Censo INEC, Estadisticas Nacionales, San Jose, Costa Rica, 2000. 117. ICE, 2004. 118. Coto, F., 2004. “El Movimiento Indigena, el Papel del Estado y la Participacion de Otros Entes Locales, Regionales, Nacionales e Internacionales en la Dimension del Proyecto Hidroelectrico de Boruca,” Buenas Aires, Costa Rica.

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119. Villanueva Villalobos, Danilo, Gran Plan de Inversion Indigena Global “La Reinvindicacion,” Buenas Aires, Costa Rica, 2004. 120. Ibid. 121. ICE, 2004. 122. ICE, May, 2001c. “Ambientacion Proyecto Hidroelectrico Boruca,” Direccion Ejecutora Proyecto Boruca, San Jose, Costa Rica: ICE. 123. Rojas, D., October, 2004. “Indigenas Ticos Pierden Tierras,” Ambientico No. 133, San Jose, Costa Rica. 124. ICE, 2001c. 125. Centro Cientifico Tropical (CCT), 1975. “Estudio Ecologico: Proyecto Boruca,” San Jose, Costa Rica. 126. Ibid. 127. ICE, April, 2002. “Proyecto Hidroelectrico Boruca, Informe Tecnico Interno— Sondeo de Opiniones y Posiciones de Grupos Indigenas y de la Region Sobre el Proyecto Boruca,” Centro Nacional de Planificacion Electrica, San Jose, Costa Rica: ICE. 128. ICE, 2002. 129. Manglar: “Mangrove swamp,” typically found in warm, humid climates, such as Costa Rica, Venezuela and Papua, among others. 130. Coto, 2004. 131. Ibid. 132. Phreatic Levels: Relating to or used to describe the soil or rock below the water level, where all the pores and inter-granular spaces are full of water. Changes can be caused by the heating of such groundwater. 133. Bonilla, Alexander, September, 2003 “Proyecto Hidroelectrico de Boruca: Implicaciones Sociales y Ambientales.” 134. WCD November, 2000 “Large Dams Cross-Check Survey,” Final Paper— Executive Summary. 135. ICE, 2004. “Contexto Socioeconomico y Cultural del Proyecto Hidroelectrico Boruca,” Buenos Aires, Costa Rica: ICE. 136. WCD, November, 2000. “Dams and Development: A New Framework for Decision-Making,” The Report of the World Commission on Dams, London and Sterling, VA: Earthscan Publications Ltd. 137. Bonilla., 2003. 138. ICE, 2004a. “Plan de Expansion de la Generacion Electrica 2004–2020,” San Jose, Costa Rica: ICE. 139. AM Costa Rica, “Giant Boruca Project Draws Indian Protests,” 2001. www.amcostarica.com/091802.htm 140. Guillen, S., “Rediscovering Democracy: Deliberating Environmental Insecurities and the Costa Rican Power Sector,” ICE 2005 Expansion Plan, University of Peace Capstone Seminar, 2007. 141. WCD, November 2000. “Large Dams Cross-Check Survey”, Final Paper— Executive summary.

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142. Water for Power, Water for Power and Nature, 2001. 143. Gonsalves, L., 2002. “The Plan Puebla-Panamá,” Chiapas Support Committee. http://www.globalexchange.org/countries/americas/mexico/ppp/resistance. html 144. ICE, 2002. 145. Ibid. 146. “The Convention on Wetlands of International Importance Especially a Waterfowl Habitat”, adopted in Ramsar, Iran, in 1971 (entered into force, 1975) and known as the “Ramsar Convention.” 147. CEDIN, 2002c. “Preidentificacion de Efectos del PHBoruca Sobre Poblaciones Indigenas,” Buenos Aires, Costa Rica:CEDIN. 148. INEC: “El Instituto Nacional de Estadística y Censos”. For more information, see www.inec.go.cr. 149. Rojas, D., October, 2004. “Indigenas Ticos Pierden Tierras,” Ambientico No. 133, San Jose, Costa Rica. 150. Aquifer: A layer of permeable rock, sand, or gravel through which groundwater flows, containing enough water to supply wells and springs. 151. Lazaro, H., October, 2004. “Usos y Abusos en Tierras Indigenas,” Ambientico, San Jose, Costa Rica. 152. ICE, 2004. 153. WCD, 2000. 154. Ibid.

4 Rethinking Project Design Renewable Resources as a Key to Sustainable Development Costa Rica needs to rethink the energy project design by taking into account the “triple bottom line” to include not just the financial viability of a project but also the environmental and social costs of power production. These priorities do not have to be at odds, indeed, adopting a mediation approach that elicits the values and priorities of all stakeholders can naturally lead to the best balance of environmental, social, and financial costs and benefits in a given project. Committing to a fossil fuel free generation plan would create a more dependable, secure, and less expensive electricity system in Costa Rica than Instituto Costarricense de Electricidad’s (ICE) current recommended generation plan. Moreover, a Clean Power Plan is well within the proven resource potentials of the country and the capabilities of the power sector. The Clean Power Plan shown in Figure 4.1 can be viewed as one possible example.

Demand Management and Efficiency The cheapest source of nonconventional energy is most often conservation through efficiency and demand management programs. An 11 percent reduction in power demand by 2025 through demand management programs is very realistic in Costa Rica. There are a number of demand management programs that could be undertaken in Costa Rica such as load management, real-time pricing, and industrial and appliance standards.

127

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CONFLICT RESOLUTION OF BORUCA ENERGY PROJECT Installed Capacity

Predicted Capacity Needed 2025:

4700 MW

11% Demand Management Savings:

-500 MW

Total System Capacity:

4200 MW

65% hydro

2730 MW

15% geothermal

630 MW

10% wind

420 MW

10% biomass + solar

420 MW

0% fossil fuel combustion

0 MW

Figure 4.1 Clean Power Plan 2025

Demand management, especially focusing on reducing peak load, can significantly reduce utility spending on new capacity. Costa Rica has had good results with load management programs in the past. In 1987 ICE was facing a situation very similar to the current electricity crisis. It was cash strapped, unable to make new capital investments, and was facing rapidly increasing power demand. The country faced imminent power shortages. In 1988, with technical assistance from USAID, ICE undertook a shortterm load management pilot project to reduce peak loads. The project targeted large commercial and industrial clients with consumption levels higher than 20,000 kWh (kilowatt hour). In just one year, the 18 companies in the program were able to reduce their peak evening load by an average of 19 percent at almost no cost, using low-tech changes in their activities. The payback period for the whole group was less than two months. The study concluded that if the program were extended to the entire commercial and industrial sector demand could have been reduced by 17.2 MW conservatively, or almost 3 percent of the total system peak demand.

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ICE also benefitted from the project through deferred costs of generation and new capacity estimated to have an annualized value of $154,656 net of reduced revenue from lower demand billing. Because of these very positive results, in 1990 Ministerio de Ambiente y Energía (MINAE) and ICE carried out a follow-up assessment of the power sector. The Assessment concluded that demand-side management programs, load management, and energy conservation, could provide peak demand savings in the power sector of 12 percent of total forecasted peak, and increase ICE’s income by $103 million over a 15 year period.1 New efficient technologies would increase these savings. New metering technologies also allow for real-time pricing, which can significantly lower peak energy demand. Real-time pricing is a utility rate structure in which the per kilowatt hour charge varies based on the utility’s real-time production costs. Peak-time plants are more expensive to run than base load, so the peak-time price is higher. In a recent pilot project in California a utility installed 23,000 real-time meters for large customers at a cost of $35 million. In response, summer peak demand by those customers dropped by 500 MW under time of use pricing, which would allow the utility to avoid $250–300 million in capacity additions.2 In Costa Rica, in 2005 the CNFL began to offer a new rate structure similar to a real-time pricing scheme that was based on the marginal costs of electricity throughout the day. Under this rate scheme, kilowatts cost more than the average per kilowatt price during peak demand times, morning and early evening, and less than the usual per kilowatt price during the night and midday. Customers can choose this rate schedule if they believe it will save them money. Results of the program have not yet been published. Demand-side management programs will be the quickest and cheapest method for Costa Rica to meet its imminent electricity shortages. As noted above, an assessment study in 1990 concluded that the country could have reduced peak demand by 213 MW in 2005 if it had pursued demand management initiatives.3 This amount would have more than made up for the 120 MW missing from the delay in the Garabito diesel plant. The Costa Rican electricity system is well-structured to enact efficiency measures because ICE does not struggle with split incentives. Unlike private utilities, the state utility does not have an incentive to sell more power. The mandate of the public company is to provide the public service of electricity as cheaply and efficiently as possible, not to make a profit through selling power.

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Wind Power Wind energy is presently the most promising alternative technology in terms of cost competitiveness. Cost per kilowatt hour depends significantly on each project; the size of the wind turbines, wind velocity and so on. However, costs have been achieved as low as 2–3 cents per kilowatt hour compared to 3–4 cents per kilowatt hour for coal generation.4 When comparing any cost figures it is important to realize that the cost of renewable sources are dependent on the specific parameters of each project and do not include benefits from externalities discussed above. One U.S. report found the cost benefits of a 100 MW wind farm to be 1.75–2 times the direct expenditures. Moreover, wind power is one of the fastest growing energy technologies in the world and is expected to continue to grow 15 percent to20 percent annually through 2020. The industry and technology have become mature and costs have declined by 12percent to 18 percent with each doubling of global installed capacity.5 In 2003, the worldwide installed wind capacity reached 39,294 MW, an increase of 26 percent.6 Wind power provides a very promising energy source in Costa Rica because the windy and rainy seasons are countercyclical; wind and hydro generation can complement each other in the integrated management of the country’s generation resources. When the country’s wind turbines are producing electricity, ICE is able to slow down or avoid using water from their hydrologic reservoirs, especially Arenal dam, saving the water for peak generation needs. The first wind farm in Central America was constructed in Costa Rica in 1996 by a private company, Plantas Eólicas, S. R. L. According to Mesoamerica Energy, which now owns Plantas Eólicas, the wind plant has been operating during its ten years at a plant capacity factor of no less that 40 percent of rated power, which is outstanding for a wind park. Average wind speed in this area is 26 miles per hour (mph). There are now four wind plants in Costa Rica, three private all of which received funding through Joint Implementation, and one was constructed by ICE, all in the Tilaron area of Guanacaste. The capacities are 19.8 MW, 6.4 MW, and two at 20 MW. CNFL, JASEC Municipal Company, SAREC Energy Systems, and Coopenguanacaste are presently developing plans for wind farms in other areas of the country.7 A significant barrier to wind power development is the disruptive effects that the wind’s inconsistency can have on the entire grid. For this reason, the law in Costa Rica limits the total participation of wind energy to

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6 percent of installed capacity. New technology advances, however, have overcome some of these technical hurdles. A recent study suggests that system integration costs are not significant when wind power is under 10 percent of total capacity.8 Even given these limitations, wind energy could play a much larger role in Costa Rica’s expansion plan, especially because the wind blows most consistently during the dry season when electricity shortages result from decreased hydroelectric power. A new comprehensive wind energy potential study is needed in the context of the newest technological developments. The only national study of wind potential in Costa Rica was conducted in 1985 and estimated potentials at only 600 MW. The dramatic pace of wind technology development over the past 20 years renders this figure meaningless.

Biomass Costa Rica has plentiful sources of biomass energy, including municipal wastes, agricultural and industrial wastes, and numerous potential energy crops. There are four main techniques for making use of biomass resources; combustion, gasification, anaerobic digestion to produce methane gas, and biodiesel or biogas fuel production. All of these techniques have been used or are feasible in Costa Rica. The gasification process converts any carbon-containing material into a synthesis gas composed primarily of carbon monoxide and hydrogen, which can be used as a fuel to generate electricity or steam, or used as a basic chemical building block for a large number of uses in the petrochemical and refining industries. Gasification adds value to low or negative value feedstocks by converting them to marketable fuels and products. Throughout the 1980s and 1990s a number of industries used waste products for their electricity generation in Costa Rica. From 1978–1984, the National Cement Industry used walnut shells for heat production. In the mid 1980s the corn industry experimented with biodiesel production and used waste corn products in the drying plant. Some brick plants also used sawdust as a petroleum alternative, but shifted to diesel in 1995. Rice husks are still used by the majority of rice producers for drying rice. In the period from 1999 to 2000, approximately 50 percent of rice factories used solely rice husks as fuel, while an additional 27 percent used a mix of rice husks and petroleum. All of these waste products could also be used to fuel electrical generators. Other possible biopower agricultural waste sources include coffee husks and undergrowth, and wastes from African palm production.9

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The most well used and perhaps most promising source of biomass power in Costa Rica is sugarcane waste. El Viejo, one of the largest sugarcane producers in the country, is presently contracting with ICE to produce about 4 MW in 2009. However, El Viejo could produce as much as 25–26 MW if it were not limited by Law 7200. José Alvaro Jenkins, managing director of El Viejo, estimates that the four largest Costa Rican sugar factories could produce as much as 120–130 MW. A Columbian cogenerator has figures of costs at $0.01/kWh using sugarcane waste production.10 The production of devoted energy crops for combustion or biofuels is another possible biomass power source. Plantations of fast-growing tree species could be a promising source. LAICA, Costa Rica’s AgroIndustrial League of Sugarcane Producers, has extensively researched ethanol fuel production from sugar.11 Indeed, from 1980 to 1983, Costa Rica used a sugar-based ethanol gas mixture throughout the country. However, production of ethanol stopped as world petroleum prices fell and sugar prices rose. The African palm industry has a pilot project using biodiesel from palm oil in electric generators. However, from a total energy system perspective, energy crops that produce liquid fuels are better used as transportation fuel substitutes instead of power production.12 Existing diesel and bunker generation plants could be adapted to use biodiesel fuels. Finally municipal waste can be burned directly in generators. Methane gas can be collected from dumps for combustion. Presently, one such project exists in Costa Rica. The Rio Azul methane waste plant developed by CNFL and managed by SARET energy systems produces 3 MW. As mentioned above under carbon financing, landfill waste generators present very interesting opportunities for carbon financing, as much as 15 percent of project financing.

Geothermal Costa Rica lies on a line of volcanoes. The country built its first geothermal plant in 1994 and now has the world’s 10th largest geothermal electricity capacity. Costa Rica exploits 157 MW of an estimated total geothermal capacity of 865 MW.13 Two new 35 MW plants will be constructed under ICE’s recommended plan in 2011 and 2012. Geothermal electricity can be very cost competitive with conventional energy sources. A California study quotes prices of $.47/kWh for flash geothermal electricity and $.76/kWh for binary geothermal, a technology used for lower enthalpy geothermal resources.14 New technologies are rapidly developing to make use of less concentrated geothermal energy.

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The key barrier to further geothermal production in Costa Rica is the location of the most concentrated sources within national park boundaries, where legal parameters prohibit development. Two directions for geothermal energy development are possible in Costa Rica: (1) developing low-enthalpy sources outside of park boundaries or (2) creating flexibility within the national park legal system to allow for low-impact geothermal exploitation. Examples exist in New Zealand of geothermal plants coexisting with national parks to such an extent that the electricity plant itself becomes an attraction. The history of geothermal development in Costa Rica presents important lessons and examples for the development of other renewable technologies. In 1984, a geophysicist from ICE attended the UN Geothermal Training Program of the United Nations University in Iceland. The goal of the program, which is still running, was to assist countries with significant geothermal potential to build up groups of technical experts. Forty-four professionals from five Central American countries and Mexico have attended the program including 11 Costa Ricans, some of whom continue to lead geothermal development at ICE.15 Similar programs could, and should be established to train technicians in other energy technologies, a program on wind power in Denmark, for example.

Solar Solar energy can be harnessed either directly through thermal concentration to produce steam for generators or through photovoltaic panels. Recently thermal solar power has become more economically attractive with extensive research and successful pilot projects, particularly in Israel. Photovoltaic power, however, in most cases remains prohibitively expensive on a large scale, though prices have declined on average 4 percent per year over the past 15 years.16 Grid connected solar photovoltaic (PV) has been the fastest growing energy technology in the world with an average annual growth rate of 60 percent between 2000 and 2005.17 In Costa Rica. photovoltaic panels are used in rural areas where grid connection is prohibitively expensive. ICE also has a pilot photovoltaic project. The most promising utilization of photovoltaic cells in Costa Rica may be thin film PV, which can be imbedded in building materials, such as roof tiles and windows. For large buildings the adverted cost of building materials makes these systems economically viable. Nanosolar, a California based company, recently announced breakthroughs in thin film solar production that will reduce its solar panel costs by one-fifth to one-tenth of

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the current panel prices and will allow the company to manufacture plastic sheets coated with the PV particles so that they can be incorporated into roof tiles or building glass.18 The most economic application of thin film building technologies would require ICE to adopt a “net metering” scheme. Net metering allows a two-way flow of electricity between the electricity distribution grid and customers with their own generation. When a customer consumes more than it generates, power flows from the grid and the meter runs forward; when the customer generates more power than it consumes, electricity flows into the grid and the meter runs backwards. This system allows customers to receive retail prices for the excess electricity they generate at any given time. Net metering can improve system load factors, especially solar, which produces electricity during morning and early evening peak load periods. Net metering systems are now used extensively in the United States and Europe. Thailand has recently adopted a net metering policy.19 Solar hot water heaters present another promising technology that could be used in Costa Rica. Solar hot water shows the greatest future potential among all renewable technologies. In 2006 Spain passed national legislation mandating solar hot water for most new buildings and renovations. The market is already huge in China, with costs just a fraction of those in Europe.20 Costa Rica also has a small solar water heater manufacturer, and solar water heater research is ongoing at the National University solar laboratory.21 The National University’s solar laboratory works on small-scale solar project research. Researchers at the solar laboratory have completed comprehensive studies on the average solar radiation in Costa Rica for each month and each area.22 Unfortunately, this information has not been well utilized. Collaboration between the solar laboratory, ICE, and private industry should be encouraged to take advantage of the growing opportunities for solar industry in Costa Rica.

Hydropower Hydropower in Costa Rica will continue to have a large role to play in any future generation plan. During the rainy season, the country can continue to depend on smaller “run of river” projects with small reservoirs that have fairly benign environmental impacts. However, large reservoir dams are needed to provide power during the dry season. This is the reasoning behind the El Diquís project.

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Indeed, the UNEP concludes that “to meet the increasing demand for clean, renewable energy and reliable water supply, hydropower development will be a key tool....Like all large scale interventions, major hydropower projects involve managing risks and benefits. For a project to be sustainable, both have to be shared in [a socially] acceptable way”.23 Hydro-Québec, a Canadian provincial utility, (UNEP, 2000) has established three essential rules for all future projects to reduce risks. New projects will only be built if they meet the “triple bottom line,” that is it should be: z z z

profitable under market conditions; environmentally acceptable, and; well received by the local communities.

Though it is impossible to mitigate all of the ecological impacts of large dams, there are a number of mitigation techniques that ICE could undertake to lessen the negative impacts of the project. To be successful, mitigation techniques must be considered during the initial planning of the project and extensive ecological research must be undertaken. Improved research and assessment of compensation and resettlement costs must be undertaken to ensure that affected communities, particularly indigenous communities, are satisfactorily compensated.

Economic Sustainability The economics of alternative energies are improving rapidly as the technologies mature, the industry grows, and the costs of conventional fuels increase. “Even though, on a stand alone basis, renewables are often seen as expensive, modern financial analysis techniques, which focus on the medium term evolution of the energy based portfolio, show that a certain percentage of renewables in the overall fuel mix of a utility reduces the overall risk and the overall portfolio cost.”24 The key to alternative energy economics are the opportunities presented by externalities. For example, cattle ranchers can pasture cattle on wind farms. Roof tiles and windows can be embedded with solar cells such that with very little extra material costs a building can supply its own electricity. Waste products from agriculture, which have been traditionally burned or buried in landfills can fuel thermal generators. Industrial plants can incorporate electricity generation technologies to use their own wastes to cover some, if not all, of their energy demand. Other external benefits include averted costs from

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using waste that would otherwise have to be managed as well as averted environmental costs of fossil fuel pollution and large dam impacts. Additional external benefits of alternative energy include local job creation, energy security, and the avoidance of the risk of external fuels and price volatility. The application of diverse alternative technologies creates a robust electricity system that is much better equipped to handle disruption, whether natural or political. The economics of alternatives also improve when they are considered as part of an integrated system that meets the changing daily and annual energy demand curve. Economic benefits can also result from reduced transmission losses from distributed generation. All of these additional benefits, which are not incorporated in conventional calculations of costs per kilowatt hour, present very real financial savings and economic incentives for alternative power generation. Alternative energy sources include thermal and photovoltaic solar power, tidal, wave, wind, geothermal, and biomass from energy crops or agricultural, municipal, and industrial wastes. Energy experts conclude that there are no fundamental technological or economic constraints to alternative energy generation. Instead they are being held back by market failures and policy barriers.25 Exploitable renewable energy resources in Costa Rica are abundant. During the dry season, large areas receive almost uninterrupted sun and strong, consistent winds. The country is lined with volcanoes, pointing to abundant geothermal energy. Being in the tropics, biomass is abundant year long. Over the last decade, capital costs for most of these technologies have halved and are expected to halve again over the next decade.26 Over the past two decades, renewable energy technology has consistently met or exceeded cost goals and expectations.27 In many cases, costs per kilowatt hour are now competitive with fossil fuel generation when all values are included; environment, jobs, security and so on. Some technologies, such as wind power, are competitive without even considering external costs and benefits. ICE’s lack of experience with an awareness of alternative technologies means that alternative energies are not included in operational plans and therefore do not receive adequate funding for research and development. The International Energy Agency has portrayed the cost competitiveness of renewable sources in this way: The average costs of large hydropower, combustible renewable sources, and waste plants are currently competitive with wholesale electricity prices. In the case of other renewable

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sources that are not yet competitive with wholesale prices, “depending on the technology, application and site, costs are competitive with grid [retail] electricity or commercial heat production. Under best conditions, optimized system design, site and resource availability, electricity from biomass, small hydropower, wind, and geothermal plants can produce electricity at costs ranging from 2–5 cents/kWh.”28 These costs are comparable to typical conventional power generation costs which are US$2–5 cents/kWh for base load power, and can be considerably higher for peak power.29 These cost comparisons, however, only consider financial costs and do not include hidden social and environmental externalities. In almost all cases, costs per kilowatt hour for renewable sources are considerably lower than fossil fuel generation when all costs and benefits are counted, costs such as air pollution, health, climate change, jobs, financing, security, and habitat loss. Renewable technologies become even more competitive when integrated into a diverse distributed generation system and are designed to match demand characteristics. In the Costa Rican context, wind and geothermal power are less expensive than fossil fuel generation without even considering external costs and benefits. Many energy experts conclude that there are no fundamental technological or economic constraints to alternative energy generation. Instead they are being held back by market failures and policy barriers.30 This is certainly the case in Costa Rica, where a number of institutional, regulatory, and legal obstacles restrain new renewable projects; including a lack of communication, trust and coordination among the primary actors in the energy sector, an absence of experience and capabilities with nonconventional renewable sources, inadequate planning tools, legislative limits, limited funding mechanisms, and political interference within ICE. Costa Rica’s rapidly growing energy demand and near-term electricity shortages present significant challenges for ICE, but they also present opportunities for innovation. Costa Rica can take advantage of its current excellent education and industrial infrastructure and its political stability in order to attract foreign investment and grow new energy industries. Effectively solving the current energy challenges will require forward thinking vision and leadership, both of which Costa Rica has demonstrated time and again in many policy areas, especially in its power sector. Though ICE’s current recommended generation plan does not include plans to build natural gas power plants, the 2004 Plan de Expansion de Generacion (PEG) devotes two pages to the possible expansion of natural gas generation in the further future.31 There are no known reserves of natural gas in or near Costa Rica. In order to exploit low-cost natural gas

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technologies, the country would have to invest billions of dollars in new gas infrastructure to either construct a gas pipeline hundreds of miles from Columbia or Mexico, or build the expensive infrastructure necessary to import liquid natural gas by tanker and regasify it in the country. Even worse, natural gas prices have proven to be more volatile than oil prices and much higher than predicted prices. According to the EIA, the cost of natural gas accounts for more than half the levelized cost of energy from a new combined cycle gas turbine, and more than 90 percent of its operating costs.32 Developing natural gas generation would only increase the risk and volatility of Costa Rica’s power portfolio. Instead, they should make use of the abundant renewable energy sources within their own borders that require much smaller capital investments.

Renewable Energy is Cost Competitive A number of factors are driving the current global renewable energy boom, for example the passage of the Kyoto Protocol, growing awareness of global carbon constraints, and the high prices, security risks, and international conflicts associated with fossil fuel energy. The most important driver may be the falling costs of renewable energy. The economics of alternative energies are improving rapidly as the technologies mature, the industry grows, and the costs of conventional fuels increase. Renewable energy technologies such as hydropower, geothermal, biomass, and wind can compete with wholesale electricity where resources are good and conventional fuels are expensive. In similar situations, distributed technologies like solar can compete with retail electricity prices. The costs for renewable energy technologies have dropped significantly over the past ten years as a result of technology improvements, institutional learning, and economies of scale in production. Costs are expected to continue declining, especially given current high levels of research, development, and deployment of investment globally.33 An International Energy Agency study shows that costs have dropped 20 percent with each doubling of world capacity.34 The World Bank conducted an extensive study of current and future renewable energy costs for large (50–300 MW) and small (5–50 MW) scale grid connected power. The study concluded that when sufficient resources are available four of the major renewable power generation technologies, geothermal, bioenergy, hydro, and wind power, are potentially as economical as conventional power plants of similar small size (e.g., less than 50 MW). The study concluded, however, that conventional power generation technologies (open cycle and combined cycle gas turbines,

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and coal and oil fired steam turbines) remain the least cost option for gridconnected power over 50 MW.35 But a different accounting method changes this conclusion. The World Bank study uses levelized generation costs, which add capital, operating, and fuel costs levelized over the economic life of the plant using a 10 percent real discount rate that is assumed to be the opportunity cost of capital. This high discount rate significantly discounts future fuel prices and puts more weight on upfront construction costs biasing these analyses against renewable sources, which usually have higher capital costs and much lower, if not zero, fuel costs. Moreover, these costs do not include the “full-costs” of environmental and social externalities associated with each type of generation. Traditional financial analyses, based on discounted cash flow accounting, undervalue fuel price risks and completely ignore the environmental and health costs of fossil fueled power plant emissions.

Green Power: A Business Opportunity for Costa Rica Renewable energy has become big business. In 2004, about $55 billion was invested in renewable energy power systems worldwide, up from $14 billion in 2000.36 This amount is just over one-third of the amount that was invested in conventional power plants in 2004. New renewable sources make up 4 percent of the total world power capacity.37 Major global companies such as General Electric, Siemens, Shell, British Petroleum, Sanyo, and Sharp have made significant renewable energy investments and acquisitions in recent years. Large commercial banks are starting to mainstream renewable energy investments in their lending portfolios.38 The world’s fastest growing energy supply technology is grid-connected solar PV, which grew by 60 percent per year from 2000 to 2004. During the same five-year period, other renewable energy technologies grew rapidly as well: wind power, 28 percent; solar hot water/heating, 17 percent; and geothermal heat capacity, 13 percent.39 Renewable energy is growing extremely quickly, in part due to strong policy support. At least 48 countries, including 14 developing countries, worldwide now have some type of renewable energy promotion policy. Europe plans to make 22 percent of its electricity with renewable sources by 2010. Sweden announced in January 2006 that it plans to be oil-free by 2020 and intends to increase investment in new renewable technologies, such as wave and wind power.40 Developing countries receive about $500 million each year in development assistance for renewable energy projects, training, and market

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support. The three largest sources of these funds have been the German Development Finance Group (KfW), the World Bank Group, and the Global Environment Facility (GEF). Other sources of public financing include bilateral assistance agencies, United Nations agencies, and recipient country governments. Since 1990, the World Bank Group has supported developing countries with $2.5 billion for new renewable energy (excluding hydro larger than 10 MW). At the International Conference on Renewable Energies in Bonn in June 2004, the World Bank Group committed to a target of at least 20 percent average growth annually in both renewable energy and energy efficiency lending over the next five years.41 Green power technologies are well within the existing capabilities of Costa Rican industry and infrastructure and represent a promising opportunity to participate in an emerging technology market. For example, the United States, Costa Rica’s most important trading partner, constitutes almost one-fifth of the wind energy market. A well-developed wind technology industry in Costa Rica could help meet the growing demand for wind turbines in the United States. There is also growing interest in renewable sources in Central and South America. Costa Rica already has the institutions necessary to move ahead quickly with renewable energy technologies. There are a number of industry organizations, such as ACOPE, the Costa Rican Association of Private Energy Producers, and CNP+L (Centro Nacional de la Producción Más Limpia), and the National Center for Cleaner Production. Two renewable energy financing and management companies already have headquarters and experience in the country. SARET Energy Systems has jointly developed and manages four hydroelectric projects in Costa Rica and the Rio Azul landfill gas plant.42 The plants were developed in partnership with the CNFL of the ICE group. The hydroelectric projects leveraged the Joint Implementation mechanism. Mesoamerica Energy, a renewable energy finance company headquartered in San José, plans to invest up to $200 million of equity, primarily in renewable energy projects in Central America.43 In 2004 Mesoamerica Energy acquired one of the four operating wind farms in Costa Rica. Clearly the opportunities, institutions, and infrastructure already exist. If encouraged, alternative energy technologies could present an important new industry for Costa Rica.

Full Cost Accounting Full cost accounting attempts to provide a more accurate and comprehensive picture of the true costs of economic activity by assigning explicit value

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to externalities. Some of the effects of pollutant emissions on health and on changes in environmental quality, for example, can be assessed in pecuniary terms if there are demonstrated increases in health care costs or decreases in agricultural yields. Full cost accounting principles are essential to promote optimal economic efficiency.44 The keys to alternative energy economics are the opportunities presented by externalities. Some examples include ranchers pasturing cattle on wind farms, roof tiles and windows embedded with solar cells allowing buildings to supply their own energy with little extra material costs, fueling thermal generators with agricultural waste, and the use of industrial wastes to meet a plant’s energy demand. External benefits include averted environmental costs of fossil fuel pollution and large dams, local job creation, energy security, and the avoidance of the risk of price volatility. The economics of alternatives also improve when they are considered as part of an integrated system that meets the changing daily and annual energy demand curve. Economic benefits can also result from reduced transmission losses from distributed generation. It is very difficult to quantify externalities. Most of them are interlinked and operate on different time scales. All of these additional benefits, which are not incorporated in conventional calculations of costs per kilowatt hour, present very real financial savings and economic incentives for alternative power generation. The external costs of fossil fuel generation include health care expenditures, productivity losses, pollution cleanup expenses, and lost recreational opportunities. A recent European Commission study estimates external costs of coal generation to be between 2 and 12 cents per kilowatt hour. The external costs can double or triple the direct costs of base load coal power (typically 3–4 cents per kilowatt hour).45 These external costs bring coal prices to as high as 5–16 cents per kilowatt hour, making all forms of renewable sources very cost competitive.46 Unpredictable and volatile fuel prices also add a risk premium cost to fossil fuel generation. Risk adjusted discounting can nearly double the present value of gas generation.47 In addition, renewable generation often produces external benefits that are not accounted for in traditional financial analyses, including price stability, reduced pressure on foreign currency reserves, and energy and national security through power portfolio diversity. Renewable energy systems can support decentralized markets and contribute to local economic development by creating employment, introducing new capital and innovation, and developing new revenue sources for local communities. The application of diverse alternative technologies creates a robust electricity system that is much better equipped to handle disruption, whether it be natural or political. “Modern financial analysis techniques, which focus

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on the medium term evolution of the energy based portfolio, show that a certain percentage of renewables in the overall fuel mix of a utility reduces the overall risk and the overall portfolio cost.”48 When the World Bank study adds the costs of local environmental and global externalities into the economic valuation of renewable power generation, the economical viability of renewable energy increases. If the diversification value is also added to the economic cost, the economically viable optimum quantity of renewable energy becomes even larger.49

Economic Benefits of Distributed Generation The 2005 book by energy expert, Amory Lovins, Small Is Profitable: The Hidden Economic Benefits of Making Electrical Resources the Right Size, codifies and quantifies 207 “distributed benefits” that collectively increase the economic value of decentralized generation by typically ten times (exact value is always site-/technology-specific). The benefits include increased flexibility, shorter lead times, and decreased risk of overbuilding. But perhaps the greatest benefits come from reduced losses through transmission and distribution. Distributed generation avoids some of the costs of transmission and distribution infrastructure and power losses, which together can total up to half of the delivered power costs. These savings are often referred to as “locational value.”50 In Costa Rica, the benefits of distributed generation are particularly large. The current transmission system in Costa Rica will require significant investments to be able to handle increasing demand over the next 20 years. The system is especially taxed because most of the country’s electricity is generated in the northern zone, while the greatest demand is in the central and southern areas. Focusing on local, distributed resources would help to reduce the current and forecasted burden on the country’s ageing transmission system.

Carbon Financing Bilateral and multilateral funding also shifts the economics in favor of renewable energy in Costa Rica. Multilateral banks and institutions have begun large programs specifically supporting alternative energy expansion in developing countries. The KfW approved about $180 million for renewable sources in 2004. The World Bank Group committed an average of $110 million per year to new renewable sources during the three-year period 2002–2004. The GEF allocated an average of $100 million each year

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from 2002 to 2004 to cofinance renewable energy projects implemented by the World Bank, United Nations Development Programme (UNDP), United Nations Environment Programme (UNEP), and several other agencies. In terms of bilateral assistance, in 2004 donor countries financed almost $500 million in renewable energy projects.51 The emerging global carbon markets represent a very important financing opportunity for renewable energy in Costa Rica. Costa Rica has already proven that it is very capable of handling these types of projects. It was the first developing country to build Joint Implementation projects under the Kyoto Protocol. In 1994, the country established the Office on Joint Implementation (OCIC), through a cooperative effort between MINAE and a private organization specialized in the attraction of foreign investment, CINDE (Costa Rican Trade and Development Board); and two nongovernmental organizations, FUNDECOR and ACOPE, experienced in forestry management and private generation of electricity.52 Through this office, four electricity joint projects were implemented— three wind plants and one hydroelectric plant, which are now managed by SAREC. The projects were considered especially successful because the OCIC was able to attract a substantial level of funding while maintaining strong requirements regarding the benefits that needed to accrue to the country.53 When Kyoto came into force in 2005, the Joint Implementation mechanism, which was a prototype, became the Clean Development Mechanism (CDM). The CDM allows project-based green house gas reductions in developing nations to be transformed into Certified Emission Reductions (CERs) which, in turn, are available to industrialized countries for use as credits against their own Kyoto emissions commitments. A CDM project receives a CER for every ton of carbon dioxide equivalent (tCO2e) that the project displaces. CERs can be used for compliance with Kyoto Protocol obligations or to meet emission caps under the European Union Emissions Trading Scheme (EU ETS). The EU ETS is an EU-wide cap and trade emissions trading system that trades in “EU Allowances,” called Emission Reduction Units (ERUs). The challenge for project developers is that CERs are only awarded after the project has been completed, whereas financing is most often necessary at the beginning of the project development. To meet this need, carbon financing has developed to buy carbon credits before a project is completed. As of late July 2006, emission reduction purchase agreements for future CERs were being traded at fixed prices between $9.60 and $15.60, where the buyer takes the risk of nondelivery. For CERs already issued, or where the sellers take the risk, prices were around $18.54

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With CER prices at a very conservative $4 tCO2e, CDM provides added revenues of $3–6 per megawatt hour for renewable projects replacing electricity produced with diesel fuel, such as ICE’s Garabito plant. This additional cash flow generally improves the finances of a project by 1 to 3.0 percentage points.55 As CER prices increase, however, carbon revenue increases proportionately. Moreover, if displaced future fuel costs are also considered in the financial equation, carbon financing can begin to shift the economic equation towards renewable generation. Renewable energy projects that reduce methane emissions receive more significant CDM benefits because methane has 21 times higher green house gas potential relative to CO2. A CER price of $4 per tCO2e provides added revenues of $14–16 per megawatt hour of electricity produced depending on the type of methane gas displaced. In addition, projects like landfill gas generation, which utilize the methane to generate electricity that displaces fossil fuels, also get the fuel displacement CERs. The total additional cash flow can improve the financing on these projects by more than 15 percentage points.56 Given these figures, developing new landfill gas projects in Costa Rica, such as the successful Rio Azul project, would be economically very attractive. In order to qualify for CERs, a project must prove that emission reductions are “additional,” that is the renewable energy project must displace a previously planned fossil fuel plant. For this reason, ICE’s current generation plan could be considered brilliant. It provides “additionality” proof for all new renewable projects in the country. Besides the Kyoto-based emissions certificates, many large companies are beginning to “offset” their carbon emissions by funding reforestation, renewable energy, and efficiency projects. In 2005, for example, WholeFoods grocery chain bought 458,000 megawatt hours of green power to offset the company’s power demand. A number of airline companies offer emissions offsets to their customers. The carbon certificates can be bought through a number of new organizations developed to fund renewable energy and efficiency projects for this market.

Social Sustainability The Need for Greater Adherence to Good Practices An attractive energy project, among other things, includes the participation of the community, dispute resolution practices, and adheres to

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international norms and standards. “In order to ensure the social and economic acceptability of potential projects Hydro-Québec has developed a partnering strategy with local communities, whether indigenous or not. This strategy offers local communities the option to participate in the project’s equity by becoming, in effect, part of the project. It also offers local communities an array of other options, such as revenue sharing agreements, trust funds, etc.”57 “A signed agreement between Hydro-Québec and the officially elected community representatives is the negotiated outcome of those partnerships. Fulfillment of the three basic conditions mentioned above is the subject of continuous monitoring throughout the project’s life cycle.”58 “The need for improvement in public involvement and dispute resolution for large dams may be one of the few things on which everyone involved in the building of large dams agrees. For the most part, however, the need is for a greater adherence to known principles and for a much more expanded and better use of existing approaches, processes, and tools. The literature and conversations with those involved in the dam processes yield many deficiencies with the current process including failure to complete (or make timely) public consultation prior to decision; not ensuring that the broadest spectrum of sectors of society is involved pro-actively; failure to deal with and resolve mistrust between stakeholders and government; entrenchment of centralized decision making; lack of access to, and dissemination of full and good quality information; and lack of involvement by affected people in design and implementation of project monitoring.”59 “The need for more extensive use of existing approaches to public involvement and resolving conflicts stems primarily from the deficiencies in the process and several significant social trends about dam projects. Emerging international norms concerning public involvement in all types of development and facility siting greatly extend the formal requirements and the expectations of participants. Public scrutiny of large dam projects has grown in part due to increased understanding and interest by nongovernmental organizations (NGOs). Rapid advances in communications technology also allow more stakeholders to interact. These trends and others mean that public participation programs will have to be more timely, greater in scope, better designed, and more diligent in identifying and involving the broadest possible cross section of society. Most importantly, these improvements will have to produce programs that are more meaningful to all those who participate. If they are not, disputes and conflicts over dams will increase dramatically.”60

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Decision-making The World Commission on Dams concludes that “there are nine decisionmaking stages of the development process for large dams (or for many of their alternatives) for which there are opportunities and techniques for involving the public and for which conflict resolution approaches will be helpful, problem identification, alternatives proposal, site selection, project design, impact mitigation, construction, operations monitoring and evaluation, re-licensing and decommissioning. At each stage, more extensive information dissemination and active involvement of the essential stakeholders is necessary. For many of the stages, these activities are often not conducted early enough or adequately, especially after construction has begun. All participants need to be aware that disputes and conflicts are inevitable in such large projects, and that systems need to be proactively agreed upon and developed to manage these issues as they arise.”61

Institution Building The World Commission on Dams suggests that a universally acceptable approach, process, and set of norms for public involvement would help strengthen the ability of minority interests for conflicts and involvement in dam processes. “Both intentional and unintentional capacity improvements for local and regional groups can be beneficial in the context of regional river planning and dam siting and construction. While there are sometimes concerns about the source of assistance, overall groups that are better organized with more training are able to participate more effectively in public involvement processes and negotiations. National governments and international organizations have experienced an evolution of international norms concerning public involvement in the last twenty years with many countries and institutions now requiring significant programs. This trend is significant and, if strengthened, could continue to produce approaches and processes that are more widely acceptable and protective of minority or less organized interests. Currently, the approaches and processes for handling conflicts tend to be ad hoc and vary greatly between countries, regions, and levels. A more universally recognized and utilized set of principles, approaches, and process steps for involving stakeholders and handling conflicts would improve decision making and the quality of the outcomes.”62

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The National Plan of Development of the Indigenous Towns of Costa Rica concedes, “The increase in the well being of all Costa Ricans, the eradication of poverty; the central and governing objective of all national efforts towards human development, respect and participation, respect for culture, religion, social and economic organization and one’s own identity; these gave birth and foundation to the overall objective of the PNDPI, namely, a vision of integral development for the improvement of the quality of life of indigenous peoples, respecting their organization and cultural identity.”63 Within this normative framework, policies and aspects that are fundamental for the development of the indigenous communities will have to be defined, namely, infrastructure, housing, education, health, and production, to mention a few. These necessities must be shaped into plans and programs that will have to be developed with participation by indigenous communities. This investment plan would not only solve the urgent necessity, but would also serve to allow the indigenous representation to negotiate in stages and at different political points in time, the importance, permanence, and transcendence of this approach. The government’s pledge, in this sense, will be to facilitate these groups and to obtain greater capital investment through physical capital, such as a home or land to harvest; or human capital by means of education, basic health, training, and other services.64 The axes of the PNDPI65 are the promotion and execution of actions aimed at raising the quality of life and eliminating socioeconomic differences of the indigenous population with respect to the national population, within a framework of respect for the cultural specificity of the indigenous peoples, and with their ample participation.

Overcoming Barriers to the Implementation of the Sustainable Power Projects in Costa Rica The following strategies to address these barriers are suggested: z

z z

coordinate plans and goals between the ICE and the Ministry of the Environment and Energy, with frequent communication and at least quarterly meetings; monitor and enforce existing plans; aggressively fund new energy research and development as a top national priority;

148 z z

z

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leverage funding and partnership opportunities through the Kyoto Protocol’s CDM and the many emerging global carbon markets; partner with developed countries like Spain in RD&D for new energy technologies and prototyping of cutting edge technologies such as solar thermal generation and wave energy; reform the legal environment to allow for more competition from private electricity generators to bid for projects within the context of strong regulatory mechanisms that foster clean energy, efficiency, and distributed generation expansion; restructure ICE for increased efficiency, political autonomy, and updated accounting methods, and adopt new planning tools and methods that can incorporate new energy technology options and analyze the full lifecycle costs of new generation plans.

Addressing the Policy and Legal Limitations The 2000 World Energy Assessment reports that “there are no fundamental technological, economic, or resource limits constraining the world from enjoying the benefits of both high levels of energy services and a better environment. . . if only governments adopt new policies to encourage the delivery of energy services in a cleaner and more efficient way.”66

Legislative Limitations to Renewable Energy Projects The most direct legislative limit to renewable development is the 6 percent legal limit for wind generation, but many actors in the energy sector argue that legislative limits on private participation, that is, 15 percent participation, 20 MW plants, as well as ARESEP’s rate schedules, limit the development of alternative energy in Costa Rica to an even greater degree. The legal environment does not encourage innovation in the electricity sector. At the same time, the institutional structure within ICE, with the appointed president and board of directors, results in a directing body with more political ties than technical expertise. This structure has been a major factor in recent controversy and corruption scandals within ICE and the legislature. Restructuring ICE and allowing increased private participation and freer markets could meet growing energy demands with more diverse and renewable solutions than the present monopoly has allowed. Many analysts agree that success in creating a market for

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renewable sources is contingent on private sector involvement.67 Private companies can take greater risks and tend to be able to set up new plants more quickly than the bureaucracy of ICE allows. Privatization, however, is not a panacea. A recent UN report comprehensively compared the electricity markets in Central American countries to assess the impacts of liberalization; during the 1990’s Panamá, Nicaragua, El Salvador, and Guatemala all undertook some form of deregulation, while the governments of Honduras and Costa Rica retained monopoly control of their power sectors. During the study period, Costa Rican consumers continued to have the lowest electricity tariffs and the highest electrification coverage in the region. The study also concluded that only Costa Rica maintained acceptable levels of technical and nontechnical electrical losses in the region, and only Costa Rica continued to increase renewable energy sources over the past decade.68 Clearly, ICE as a state company has successfully provided high-quality power services to the country. For this reason, ICE and the government should maintain a strong regulatory role, but they should allow for more legal flexibility to sustainably meet Costa Rica’s growing energy demands. One employee from ARESEP suggested easing the restrictions of Law 7200 to allow for a case by case analysis rather than radical change in the legal setting. Indeed, international experience shows that government participation in the early stages of renewable sources market development is critical for creating a favorable legal framework, adequate institutional support, and setting long-term goals. ICE and MINAE should continue to play central guiding roles in the electricity sector, but their roles should shift toward regulation rather than monopoly generation.

Improving National Policy for Indigenous Rights The Costa Rican regulatory authorities must also stay closely involved in the process of power sector in order to ensure the protection of the indigenous communities who are certain to be impacted as power producers seek more remote sites for generation, such as the El Diquís Project. The situation of the indigenous peoples of Costa Rica is definitely precarious; it is necessary to accept that these peoples continue to live under systems of marginalization and absolute poverty. The Costa Rican Legal Code regarding indigenous matters needs a profound reinterpretation, one that fits the present reality. As long as this task is not done, by means of a Legislative Commission with the decisionmaking power necessary to raise viable alternatives, the communities

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affected will find themselves in unending struggles around an endless cycle of good intentions and legal ties (Hinrichs, M. et. al., 2004). Indigenous Law No. 6172, its regulations and its texts, as well as other laws that in some way influence the reality of the indigenous Costa Rican, must be reviewed to adjust to the priorities and values of the present members of these communities. The Costa Rican government must take steps to clarify the legal structure and position of the indigenous peoples within the country and its reserves. The law must be improved to coincide with the spirit of international treaties and with the interests of the people directly affected by it. Legislation must be reviewed and continuously updated to adjust to the social reality of these communities. A correct interpretation of the Indigenous Law needs to be made, one that defines a route by which inhabitants of indigenous reserves can improve their quality of life by full rights to their natural resources. To date, these communities have not been able to take advantage of their natural resources. An Indigenous Commission in the Legislative Assembly is recommended, as it would lead the task of reviewing existing legislation, establishing the legal means necessary to allow government institutions to create administrative mechanisms so that indigenous peoples could have profitable sources of work within the reserves. This work could include, for example, encouraging cultural and ecotourism, mining, and forestry.69 Indigenous artisans must also be protected. In the Buenos Aires area, forgery of native Boruca crafts (indigenous masks) flourishes. Nonindigenous people paint similar articles and sell them as originals at a much lower costs than the indigenous people. They are able to do this because of their access to better transportation facilities and the use of cheaper commercial materials. Indigenous peoples are also prevented from access to raft wood, their main raw material, and some natural dyes that they must gather on beaches. All of these issues must be reviewed by a permanent Indigenous Commission that establishes viable parameters for solving conflicts (Hinrichs, M. et. al., 2004). The Costa Rican government and ICE, as noted, has announced and enacted into law a number of protections for indigenous rights. However, there is a gap between intention and action. Many of the documents from MINAE demonstrate an intention to develop more renewable energy and an awareness of the benefits these technologies present. As previously noted ICE, MINAE, private companies, and the National University have conducted a number of studies and pilot projects in alternative energy technologies.

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There are a number of barriers to sustainable energy development in Costa Rica, including a lack of experience and capability with nonconventional renewable sources. For more than 50 years, ICE has predominantly been involved in hydroelectric production. They have developed backup fossil fuel plants and a small amount of geothermal electricity. Perhaps for this reason the planning department at ICE demonstrates a lack of awareness of the newest alternative energy technology development. Without research, they have disregarded alternatives as economically infeasible. Common perceptions of renewable energy among policymakers, business leaders, and the public still lag far behind the reality implied by the current investment and market trends. Eric Martinot of the Renewable Energy Policy Network for the 21st Century recently completed a study that identified “lack of utility acceptance” as one of the key barriers to renewable energy. “Proven, cost effective technologies may still be perceived as risky if there is little experience with them in a new application or region . . . . Utilities may be hesitant to develop, acquire, and maintain unfamiliar technologies, or give them proper attention in planning frameworks.”70 The World Bank has also noted that “borrower commitment” for renewable sources is constrained by a lack of familiarity with renewable energy technologies, lack of understanding of the costs and benefits, and perceptions of increased risk.71 This barrier can be overcome by building alternative energy capacity within ICE and other key stakeholders. ICE, MINAE, national universities, and other important organizations need to build understanding of, and follow the newest alternative energy technologies. As a part of this objective, in-depth studies of site-specific resource potentials should be performed in collaboration with universities and the private sector.

National Level Strategic Commitment to Alternative Energy The overarching barrier to the increased implementation of alternative energy in Costa Rica is a lack of strategic vision and coordination within the national electricity sector. Contributing factors include a lack of experience and capabilities with alternative energy technologies within ICE, the national electricity company, as well as legal, regulatory, and financial barriers. In order to expand implementation of alternative energy technologies in Costa Rica, the primary actors of the national electricity sector must define a coordinated national level “Sustainable Energy Strategy” that is endorsed by the highest levels of government. This vision should include participation by all actors in the sector, including government, private

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industry, universities, and civil society, and emphasize appropriate linkages and effective methods of communication between them. The strategic plan must include a strong monitoring system and frequent evaluations to ensure implementation. With such a strategic vision, the proper legal, regulatory, institutional, financial, and technical infrastructure can be created or reinforced to encourage large-scale and sustainable alternative energy in Costa Rica. The Costa Rican government should commit itself to a fossil fuel–free energy sector by 2020. This goal is well within the country’s capabilities, and would help Costa Rica to achieve its other national goals, including environmental sustainability, security, and local job creation. Costa Rica is already a world leader and a symbol of environmental protection. It is often called the “Sweden of Central America.” Costa Rica finds itself in a period of considerable political and economic upheaval. A new administration was just elected, the Central American Free Trade Agreement (CAFTA) is poised to be ratified by the legislature and, the Central American Wholesale Electricity Market will come into force in 2008. How much of these developments are still timely needs to be reviewed. Costa Rica’s energy policy must keep pace with the dynamic changes underway within the global energy sector, as well as reflect the country’s social, economic, and environmental priorities. The legislature’s current commitment to the law to strengthen and modernize ICE demonstrates that the government recognizes the need to update the energy sector’s regulations. As President Oscar Arias defines the goals of his administration, he should seriously consider announcing the energy sector’s intention to achieve independence from fossil fuels by 2020. Costa Rica currently finds itself in a period of considerable political and economic upheaval. The policy framework must keep pace with the dynamic changes underway within the overall energy sector, as well as reflecting social, economic, and environmental priorities.72 The current move to strengthen and modernize ICE shows that the government recognizes the need for significant changes to the legal and regulatory energy landscape in Costa Rica. In February 2006, a new government was elected. Civil society should push the office holders to give their opinion on electricity planning and get support from legislators and influential political figures. The actors within the electricity sector need to define their goals. These might include sustainability, price stability, security, increasing local jobs especially rural employment, decreased carbon emissions, reduced negative environmental impacts of electricity generation, improved green image, and increased financial support from international organizations

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and rich nations for development. All of these goals can be achieved by reducing fossil fuel imports and committing to an alternative energy future.

Create Communication, Trust, and Coordination within the Sector The electricity sector must fulfill its stated goal of biannual meetings.73 The president could begin this year with a small meeting of primary actors within the sector including MINAE and the president of ICE, along with the heads of planning and research, development, and private industry, among others. The meeting should review the most recent National Energy Plan (PNE) to identify what has and has not been accomplished. Participants should also consider why many of the goals set by the current PNE have not been achieved and create an enforceable plan with a strong monitoring system. A second larger conference should be planned with all electricity stakeholders, including universities and civil society, to further discuss a strategic plan with an emphasis on creating better methods of communication between actors to best use the resources available within the country. To this same end, the Mixed Commission on the ICE reform law should be reinstated. If gridlock persists, better facilitation should be sought rather than disbanding this vital vehicle for participation and transparency in energy policy. These meetings can begin a national conversation about the pros and cons of various generation technologies and create transparency in electricity policy.

Institutional Coordination The following policies changes are suggested in order to facilitate development of alternative energy sources: z

z

z

Implement a short-term strategy for solving the problems of the indigenous population, under the guidance of collaboration between governmental institutions and indigenous populations, and the oversight of the National Program for Rural Development (PDR). Bring together an executive unit in order to provide continuity and execute the strategy elaborated by the PDR and the PNDPI, establishing commitments between government institutions with the participation of the indigenous population. Establish mechanisms that ensure the processes of updating information and agreements regarding work in the indigenous territories, with

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the goal of making the developed efforts sustainable in an Action Plan. It is important to develop a mechanism that supports this action based on the accumulated experience during this first effort, with attention to the indigenous population, and to maintain a high level commission with representatives of the large institutional hierarchy and an operative technical commission made up of technical civil employees representing the same institutions. Establish the necessary mechanisms of interinstitutional coordination guaranteeing that the policies and actions of the PNDPI will be dutifully operationalized and executed, so that the lent services and assigned resources respond to the PNDPI’s plan of action. Use education and communication mechanisms directed at the entire country, in order to draw the indigenous culture out from invisibility, and to rescue the origins of national identity. The mechanisms to use would be, among others, the Ministry of Public Education, the Ministry of Culture, Youth, and Sports, newspapers, radio, and television. Publish a directive on behalf of the executive authority so that the PNDPI is seen as having an obligation of fulfillment for all institutions in the public sector.

For its part, ICE and other institutions involved in the project need to better systematize the community relations process, especially by strengthening the ICE offices of public relations or communication. In a world where nearly one-third of the population has no access to electricity and more than one billion people are without adequate water supply, the following challenges have been identified74: z z z

Enhanced freshwater management Increased use of renewable sources Improved poverty alleviation

“Hydropower has a key contribution to make to these priorities, as it already produces some 20% of the world’s electricity supply and provides about 95% of that generated from renewable sources. As only a third of the hydro potential has so far been developed, hydropower’s vast untapped renewable resources—existing mainly in the developing world—can contribute to the sustainable solution of the most urgent water and energy needs.”75 International Hydropower Association (IHA) regards sustainable development as a fundamental component of social responsibility, sound business practice, and natural resource management.

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To ensure that the environmental, social, and economic aspects of sustainability are fully considered in the assessment of new hydropower projects, and in the operating of existing power plants, the IHA produced a set of Sustainability Guidelines.76 When hydropower is identified as the most suitable energy option, IHA Sustainability Guidelines provide a planning tool to enable governments, policymakers, developers, investors, and stakeholders to assess the sustainability of projects.77 The Sustainability Guidelines78: z z

z z z

z z

stress the importance of planning, implementation, and operation based on an open, transparent, and effective decision-making process; consider at an early planning stage several variants for a hydropower project, including the upgrading of existing facilities, to optimize benefits at the least environmental, social, and economic cost; require environmental studies to be conducted and sound management plans, including safety programs, to be applied; call for increased cooperation and coordination between the different sectors involved— government, developer/operator, and civil society; require planners to minimize negative effects and optimize positive outcomes of hydropower projects, with any negative impacts being suitably mitigated or compensated; help define sustainable management systems, and recognize that sustainable development is the collective responsibility of government, business, and the community.

IHA79 has drafted a compliance protocol, which permits the objective evaluation of performance according to the Sustainability Guidelines. Through the use of the compliance protocol, the following can be done: z z z z z

developers can measure their approach; operators can benchmark their performance; policymakers can be assisted in their decision-making; investors can prioritize according to international standards; and civil society can be assured that good practice is being applied.

Participation of Stakeholders Multitrack intervention strategy views development as an integral part of any developing society while underscoring the importance of reconciling all parties’ competing needs by creating open lines of communications and

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exchange of information. This effort could promote governmental transparency, build an enduring trust and cooperation, and limit institutional impeding bureaucracy.

Identifying Dividers and the Connectors Government of Costa Rica Economically, Costa Rica is more stable than its neighboring countries; however, the government continues to grapple with its large internal and external deficits, and debts. The reduction of inflation remains a difficult problem because of rises in the price of imports and hindering labor market laws. Because of skyrocketing individual tax evasion,80 the country would also need to reform its tax system and its pattern of public expenditure.81 Continued failure of fiscal reform, combined with a sharp rise in U.S. interest rates, could increase the country’s debt servicing costs.82 Costa Rica’s number one earner is tourism, particularly ecotourism. The government is also conscious of the benefits of foreign investment, free trade, and development of modern laws to close the gap in its trade deficit; therefore, the need to improve the region’s dreadful infrastructures83 becomes imminent.84 Consequently, the Central American governments began working together on joint projects such as Plan Puebla Panamá (PPP), which contains eight components: (1) sustainable development, (2) human development, (3) prevention and mitigation of natural disasters, (4) tourism promotion, (5) facilitation of trade, (6) highway integration, (7) energy interconnection, and (8) integration of telecommunication services. The last four, however, are where the emphasis is being placed to entice the multinational corporations to invest in the PPP area.85 The government is an active participant in the negotiation of the hemispheric Free Trade Area of the Americas (FTAA) as well as a member of the Cairns Group, which is pursuing global agricultural trade liberalization and eliminating agricultural subsidies by the year 2013 within the World Trade Organization.86 Costa Rica, on the other hand, is going to be the last country in the isthmus to sign CAFTA. The government has balked at ratifying the deal due to the increased opposition by trade unions, some farm groups, and even some business leaders who say CAFTA’s intellectual property clauses are too invasive.87 Moreover, Costa Rica entirely depends on oil-rich Venezuela to import its petroleum; ratifying CAFTA could jeopardize Costa Rica’s relationship with its neighboring countries in Latin America.88

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To mitigate the effect of CAFTA on its population and neighboring countries, President Arias has considered creating a new flat tax rate below 10 percent for individuals to boost compliance and for corporations to regain competitiveness. If Costa Rica introduces a flat tax now, it could get a jump on its CAFTA neighbors in attracting investments. With its highly literate population, a flat tax rate could easily help Costa Rica become a prime destination for multinational investment.89

Costa Rica’s Electricity Institute (ICE) For the past few decades, dams have been viewed as a symbol of modernization that could engender economic prosperity and developmental opportunities. Dams around the world have helped communities to harness water resources for food production, energy generation, and tourism. Based on the same premise, Costa Rica’s Electricity Institute (ICE) has been studying Boruca’s Hydroelectric Dam Project to expand on the country’s sources of electricity to meet the increasing demand of its population, to attract multinational investment corporations to the region, and to export power to its neighboring countries. The Boruca Dam Project is in line with PPP’s mission of greater industrializing of the area by generating the energy needed to meet the demands of the U.S. markets. Supposedly PPP will bring jobs for the poor, but in reality it will set up sweat shops in the indigenous communities, bringing in parts from other countries and using cheap labor to make finished products.90 ICE has invested more than 30 years and a substantial amount of money, removing many impediments in an effort to bring this project to fruition. ICE is not willing to explore any other alternatives, in spite of issues and problems that are virtually halting the entire Boruca Dam Project. Originally, the project was supported by the World Bank, but after the initial environmental studies during 1990s, the World Bank withdrew itself from the project.91 The Inter-American Development Bank (IADB), however, is still providing funds for the research that is necessary for the advancement of this and other projects. Based on the World Bank recommendation, in 1995 ICE established a water basin management system to clean, reduce, or avoid sediments in the reservoirs (Jaubert, M., 2006). The objectives of water basin management are related to human development and the preservation of natural resources and the ecosystem. ICE has realized that an ecological and biological diversity is worth more alive than dead, obviating the need to control Costa Rica’s natural resources

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through management of the water basin. Some of the protected areas have a very high potential of attracting tourists, which are a major source of revenue. Thirty-three protected areas have been established in Costa Rica. The main types are biological reserves, national parks, wildlife refuges, and natural reserves.92

Environmentalists’ View of the Dam Projects Environmentalists believe that the trend for globalization was embarked from the moment superpowers began foisting the dam projects onto the developing countries under the guise of modernization. The crafters of these projects knew very well that building dams would have a tremendous impact on the environment. These environmental changes were shrewdly calculated, aiming to create dependency of many underdeveloped countries upon the more powerful ones. The report issued by the World Commission on Dams concluded that large dams have failed to produce as much electricity, provide as much water, or control as much flood water as their sponsors claimed. In addition, other and better technologies are available to provide the same benefits claimed by the engineers of these large dams.93 In an interview, José Carlos Morales, the Director of the Kan Tan Ecological Development Reserve, stated that Costa Rica already has six other hydroelectric dams (Arenal Dam, Cachito Dam, Lagarita Dam, Electriano Dam, Rio Blanco Dam, and the Reventacon Dam)94 currently operating without their full capacity being utilized. For instance, the Arenal Dam, which contains the largest lake, has four generators, of which only two are in use. In his opinion, if ICE operates all existing dams to their full capacity, the need to build a dam in Boruca will become pointless. Constructing the Boruca Dam is virtually impossible, due to the many years of irreversible damage that has been done to the environment. Many years ago, Costa Rica was famous for cutting down its forests to create grazing land for cattle ranches, which produced hamburgers for export to the United States. Because of the shifting from agriculture to livestock production, the forests that existed in the low lands, lands with lesser slopes, and nonfloodable lands in the basin, have practically disappeared.95 For this reason, significant areas have been exposed to erosive processes generated by high-intensity tropical rains, causing loss of soil and heavy buildup of sedimentations, which are reflected in increased levels of water turbidity.

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Following the closure of Térraba–Sierpe’s banana industry in 1984, many local communities turned to mangrove forest resources. Overuse of the forest’s resources, along with the agrochemicals from agriculture, the residue waters from shrimp cultivation, and the planned hydroelectric dam, has made the region environmentally fragile.96 Moreover, road construction, especially the construction of the Inter-American highway, the advancing of the agricultural frontier, and hillside farming without adequate soil conservation technique, has exacerbated the sedimentation problems.97 Currently the sedimentation and soil erosions are happening more intensely than before, threatening the structure of the Boruca Dam, if constructed. Environmentalists believe that ICE is fully aware of the existing problems and assert that the Boruca Dam Project is just a pretext to control the natural resources in the indigenous region of Costa Rica.

Indigenous Peoples of Costa Rica Generational Conflict The Boruca, also known as the Brunca, was among the first tribes to be conquered by Juan Vasquez de Coronado in 1563.98 The Boruca tribe lives in a remote area of southwestern Costa Rica, and is known for the profane and sometimes violent year end, three-day festival, which transforms the village, affecting every member of the community. The play of masks begins on a hilltop above the village where an important ancestral spirit is believed to live (Kan Tan Ecological Development Reserve). The purpose is to preserve Borucan’s traditions, culture, and way of life among the younger generations.99 In recent years, these ecological masks, however, have taken diverse meanings and are perceived differently by the old and young members of the Boruca Community. The older generation regards these masks as a pillar of their strength and a reminder of their courageous fight against the Spaniards’ exploitative advancements. The masks also represent the spiritual connection of man’s reconciliation with nature, which is reflected in the brightly colored jungle flora and fauna clustered around the coffee-colored face of a Borucan shaman or forest protector.100 Notwithstanding the arduous efforts to keep the cultural heritage alive, the Borucan youth have a different agenda in mind. During the 1990s, they were introduced to contemporary painting techniques by San José painters and quickly fused the new techniques with traditional

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carving methods. The new techniques were an immediate hit in European and North American markets. In 2003 the indigenous youth met North American textile artist Lauren Jawer while she was on a family vacation in Costa Rica. Through the Mariposa Indigenous Art and Fair-Trade Import Company she had founded, Jawer began promoting the masks, as well as high-quality woven items that village women had produced on backstrap looms. Many young Borucans have also visited southwestern Florida to attend part of a six-week exhibition at Sarasota’s Marie Selby Botanical Gardens to showcase their indigenous masks.101 The young Borucans soon realized that there is a lucrative market for their masks and an opportunity to exploit it. This has become a growing concern for the indigenous population, creating a conflict between the older and younger generations. Elderly men have claimed that the young Borucans are carelessly cutting the balsa tree down without any effort to replant the new ones, jeopardizing the region’s already endangered rain forest.102 They also fear that this stance will eventually instill the culture of consumerism among their youth, further eroding the indigenous culture and traditional way of life. PH-Boruca is situated within four cantons103 known as the “Brunca Region” in southeastern Costa Rica. Most of the population living in the area has in common such problems as substandard or nonexistent housing, limited employment options, crisis in the farming sector, low levels of formal education, and territorial vulnerability. Perhaps one aspect that differentiates this area from the rest of the country is the ethnic diversity and multiplicity of values associated with this ethnocultural wealth.104 Only 34 percent of indigenous territories remain in this area where 33 percent of the total indigenous population of the country lives. The total population affected by the project is 6,704 people, of whom 18 percent are indigenous, 76 percent nonindigenous, and the rest are considered racially mixed.105 Community Organizational Forums continue to be traditional, as do the associations, spaces organized by public institutions, agricultural centers, health commissions, education summits, counsels, unions, and specific groups.106 Some extraterritorial examples of cooperation are sponsored by international social movements, protected by resolutions or conventions, or taken up by civil society organizations (NGOs). In different indigenous territories, peoples have tied the processes of strengthening the defense of human rights with their sociocultural identity.107

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Generally speaking, residents have a strong sense of belonging to their peoples. Nevertheless, uncertainty is being generated, due to the doubts that these peoples have about the construction of the project and possible relocation of the population.

Land Conflict Indigenous peoples look askance at government’s motives for pushing developmental projects due to lack of governmental transparency and inefficient checks and balance mechanisms to control corruption. For decades, the government has not been forthcoming with indigenous peoples and has failed to keep them informed of the environmental disasters that were caused by nationwide deforestation and soil erosion. Indigenous communities are irate at governments for considering their land as a free offering to foreign investors for their monocrop exports or oil drillings, resulting in removal of indigenous peoples from communities, completely disregarding their indigenous rights.108 This was the case with Talamanca’s coast, which was home to the Bribri and Cabecar indigenous communities who managed two indigenous reserves. In October 2000, the government sold land concessions to oil companies, including the ocean bordering Cahuita and Gandoca-Manzanillo National Parks109, for oil exploration purposes. The government evicted these two tribes from their land and reduced the number of reserves from 24 to 22 by placing them in other reserves.110 Many effective instruments are available against these aggressions, but the indigenous population lacks proper decision-making mechanisms, and community organizations supporting them often do not take proper actions. These instruments consist of, the following: (A) The Indigenous Act of 1977 stating “The indigenous reserves are unalienable and unprescriptable, non-transferable and exclusively for the indigenous communities that inhabit them” (Article 3). (B) Legislative decree No. 7316 ratifying ILO Convention 169 establishing that the government must “consult with the interested people, through appropriate procedures and in particular through their representative institutions, every time they anticipate legislative or administrative measures capable of directly affecting them.” (C) Habeas Corpus petitions could be filed by indigenous peoples against any provision, agreement, decision, action, or simple material act not

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based on a valid administrative function through the Inter-American Court of Human Rights.111

United States of America Costa Rica’s reluctance in ratifying CAFTA has become a challenge for the United States. Unlike most Central American countries, Costa Rica has the longest tradition of democracy and most developed economy, in part due to sustained foreign direct investments in the production of sophisticated products like computer chips, integrated circuits, and medical equipment, and it has the region’s healthiest and most well-educated workforce.112 The United States, however, is offering an incentive for rich nations to forgive the debts of developing countries and help them with financial resources to expand their access to technology, education, governance, and other social conditions. This offer seems hard to resist by the Costa Rican government (A.M. Costa Rica, 2006).

Canada Canada has been actively involved in free trade agreements (FTAs) and shown interest in advancing a FTA with other Central American countries after signing a FTA with Costa Rica in 2001. Implementing a FTA with Central American countries is strategic, providing Canada an opportunity to expand NAFTA’s objectives by accessing Central American markets. Canada emerged as a trusted partner for Central America in the late 1980s, largely as a result of its decisive participation in the implementation of peace accords in Nicaragua and El Salvador. In Central America, Canada is regarded as capable of playing the role of a positive moderator and symbolizing a useful trading partner. Canada’s aspirations are closely related to that of the United States in attaining hemispheric hegemony.113

The Institutions and Systems Involved The National Commission for Indigenous Affairs (CONAI) CONAI was created under Law No. 5251 as the leading organization for addressing indigenous affairs in Costa Rica and as the institution that represents indigenous communities. Sustainable development projects, specifically within indigenous reserves, created a conflict between indigenous

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peoples and Costa Rican citizens due to CONAI’s fragmented and bureaucratic nature. These conflicts influenced the management and development of the ecosystem, and were the result of the pressure exerted on existing resources in indigenous reserves, as a direct consequence of population growth encroaching upon the indigenous land, increase in economic activities carried out by the population, and the conditions of extreme poverty experienced by many individuals in the region. The International Ombudsman Center for the Environment and Development (OmCED), operating under the legal auspices of the Earth Council Foundation, a nonprofit Canadian organization, and CONAI, signed a binding agreement on August 2003. The agreement was aimed to benefit the environmental development of indigenous peoples or Costa Rican citizens at large. Article 5 of this agreement states “CONAI is the only institution responsible for indigenous affairs and that any other organization interested in assisting or supporting indigenous communities must expressly be authorized by CONAI.”114 Basically, this agreement limits the participation of other organizations who are truly concerned about the welfare of indigenous peoples.

Inter-American Court of Human Rights The Inter-American Court of Human Rights is an autonomous judicial body with its seat in San José, Costa Rica, possessing an international character. The court, through its contentious jurisdiction, has provided individuals the opportunity to file habeas corpus cases against any administrative acts that have been carried out capriciously. Based on a monist approach, the Costa Rican Constitution has affirmed that international law supersedes domestic law. The Costa Rican Constitution has affirmed that international law supersedes domestic law. Although there are no mechanisms to enforce judgments imposed by the court, all adjudicated cases remain open until the state has complied with the judgment (the compliance may or may not happen). Dr. Francisco Quintana, attorney at the Inter-American Court of Human Rights stated that “human rights instruments are evolutionary living instruments.”115 With that said, he hopes that more indigenous cases will become stare decisis,116 eventually impacting other human rights cases. For instance, in the case of Yakye Axa Indigenous Community v. Paraguay,117 the victims’ representatives claimed that the “right of indigenous communities to communal property ownership of their lands is made concrete and it is the obligation of the State to delimit, demark, and title, the land of the respective villages.” Also, in the case of Moiwana Community

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v. Suriname,118 the Court recognizes the relationship between the N’djuka community with their traditional territory as of “vital spiritual, cultural, and material importance, and in preserving their integrity and identity of their culture,” therefore, land rights are vested in the entire indigenous population according to their customary traditions ,and such rights that exist in perpetuity are unalienable. One might conjecture that as a result of these decisions, the Térraba , Curré and Boruca communities were granted communal title to their ancestral land in 2005.119

Institute for Agrarian Development (IDA) The indigenous lands and territories in both the uplands and the lowlands have been under pressure from commercial agribusiness, mining, plantation, forestry, industrial logging, transport networks, and oil and gas pipelines. Despite the national laws that have recognized the indigenous territories as inalienable and nontransferable, other governmental ministries and institutions have found legal means to sell land concessions to other foreign investment corporations.120 This has been the case with IDA, which owns the land in all indigenous communities of Costa Rica. Previously, IDA granted land concessions and exploitation rights to foreign companies for their mono-agricultural production such as bananas and pineapples. The perpetual conflict between IDA and indigenous peoples stems from the still unmarked boundaries of the reserves and land uses within the proposed indigenous settlement areas that have not been legally defined, much less regulated. Also, squatters represent one of the greatest dangers to land ownership, particularly since they have occupied as much as 85 percent of the indigenous reserves and even sold the premises to others. Although the government is aware of the problem and despite progress in legal protections for indigenous territories, such laws are often not enforced.121

Associations of Indigenous Development (ADI) Lack of boundaries makes it difficult for the development associations to manage the reserves. Demarcation is very important because it defines the jurisdiction of the indigenous community to protect the land and natural resources. ADI lacks governmental funding to carry out effective studies that could protect the rights of the indigenous peoples within their communities. According to Morales,122 by the time ADI receives its appropriated funds from government, it is basically left with an infinitesimal amount,

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unable to initiate projects that could make a difference in the lives of many poverty stricken indigenous populations.123

Inter-American Development Bank/The World Bank, and Others The labyrinthine role of the Inter-American Development Bank, the World Bank, and many other financial institutions which are involved with financing sustainable projects is similar to that of the Spanish conquistadores, who would send their scouts to gather evaluative information used to decide whether the region was optimal for colonization or not. Financial institutions have been in the forefront of globalization and trade liberalization, aiming to create dependency upon the developing countries, paving the way for the developed countries to exploit them. These institutions have the scholastic power to conduct research and evaluate gathered information for their colonial capitalistic agenda. The researched information, although effective in creating damaging policies, could also be helpful in providing information to the region’s population keeping them abreast of the developments and the stakeholders’ intentions.

Public Understanding and Participation As mentioned, there is great concern regarding the impact dams may have on indigenous peoples. “There are major concerns about the effects of dam development on the poor and indigenous peoples and the differential impact on women, especially with regard to resettlement and the distribution of other costs and benefits. Public participation methods may need to be developed that involve poor and indigenous peoples in cultural, gender appropriate, and financially feasible ways. Both new and existing techniques need to be consistently implemented to increase these stakeholders’ participation.”124 Various stakeholders are generally involved in dam projects. “Stakeholders in dam related processes are numerous and largely self selected. They include those who stand to benefit by building the dam, developers and some other stakeholders; those who are responsible for making, reviewing, or implementing specific decisions concerning dam siting and operations; those who will be negatively affected, and those who seek to represent the underrepresented; those who can contribute local knowledge; and knowledgeable critics of the process. The reasons why some stakeholders do not become involved are complicated, but often closely related to difficulties with the public involvement process, i.e. not knowing

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they are stakeholders, not being informed of the opportunity to participate, not having power in the society, or not having access to the process for any number of reasons.”125 The question of who will represent local and or indigenous populations is difficult. “Problems with representation are not generally major, except with less well organized stakeholders, such as local populations, and perhaps particularly the women among them. Participants in these processes usually represent clearly defined stakeholder groups, but sometimes dam promoters and government officials chafe at the involvement of national or international NGOs, a concern occasionally shared by local groups of stakeholders. For their part, these NGOs see their involvement as helping to address significant power imbalances between local groups, multi-national companies, and national governments. It is not always clear who represents unorganized indigenous groups; this is a problem that needs attention to ensure meaningful public participation and conflict resolution.”126 It is important to note the trust issues involved in dam projects. “Trust is low between many of the stakeholders concerned with the dams that we considered. Developers are seen by local groups as having low credibility, national and international NGOs as outsiders (sometimes), and government agencies as ineffective or biased. Two very common themes that cut across many sectors and views are: 1) the concerns are effectively involving non-formal, poor, and indigenous groups, and 2) the importance of transparency in the process.”127 A national debate on these topics must be initiated. Consumers must understand that there are always cost and benefit decisions to be made to meet their lifestyle requirements. Armed with greater information, citizens can make better decisions about what kinds of electricity generation they prefer. A freer market might also allow consumers to demonstrate their preferences. A dialogue needs to be opened about the role of private industry and ICE’s accounting methods. Unfortunately, the government’s recent disbanding of the Special Commission to Reform ICE has strengthened this barrier. This is an unfortunate decision as all of these stakeholders should, and will, have a voice in the energy planning process.

Consultation/Mediation and Conflict Resolution Keeping in mind the core values for decision-making established by the World Commission on Dams,128 which are equity, efficiency, participatory decision-making, sustainability, and accountability, there are a few

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intervention strategies that can be executed simultaneously, such as the following: (1) Because the indigenous social structure does not allow for mechanisms to reach a consensus, a system should be put in place to have all indigenous voices heard. This problem is exacerbated by geography as many of the indigenous peoples do not live within a village, but are scattered throughout the territory. Working within their communal structure/capacity, a system should be created to help them organize and become informed of the issues. Dividers/Sources of Tension: There is some disagreement within the indigenous community as to whether or not the dam project will be in the best interest of the community. It appears to be a generational phenomenon, with economic concerns being of paramount importance to the younger Boruca, and preservation of community and culture a concern for the older people. Connectors/Local Capacities for Peace: The indigenous peoples have deep connections. Ultimately they all want to see the community thrive economically. The challenge will be to create a situation where that can happen while still preserving their culture and sense of identity. (2) Create a forum for productive dialogue to create an opportunity for the government to be transparent regarding their intentions. Dividers/Sources of Tension: There is a sense of marginalization and mistrust between the indigenous populations and ICE and other governmental institutions. Costa Rica has a history of taking private indigenous lands without compensation. In particular, there has been no financial compensation for property taken when the InterAmerican Highway was built decades ago. There is also speculation in regard to ICE and the government’s actual intentions that are driving the dam project. ICE feels that many indigenous groups are trying to take advantage of them by asking for large sums of money. Connectors/Local Capacities for Peace: The government relies heavily on ecotourism. Protecting and preserving natural resources is consistent with this objective. The possibility exists to create economic opportunities for the indigenous communities that would not impact their social structure. Also, by enrolling international environmental groups, there exists the possibility of technical and financial aid to look for other sources of renewable energy.

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(3) For those opposed to the dam, create strength through advocacy. There is a power imbalance in this conflict, which could be ameliorated by specifically targeting and involving international environmental organizations. This would also serve to generate international awareness. Progress has been made in the past year toward Costa Rica honoring its legal commitments to the indigenous peoples. A resolution to this conflict is possible if all parties are clear about their needs. This means that the government of Costa Rica needs to be more transparent with regards to their intentions behind the dam project. While they publicly state that the dam is needed for national energy needs, it is highly suspect that there are other motivations involved. The Boruca and other affected indigenous peoples need to present a unified position. International organizations would be immensely beneficial in providing technical and financial assistance as nondam options are explored. These include demand side management, supply efficiency, and new supply options. Encouraging participation is important. “A significant issue for public involvement programs is the need to assist groups that have traditionally had little voice in society. With limited voice and experience, such groups may either refrain from participation, or conversely, rapidly indulge in the tactics that they use to make them heard. Both situations are detrimental to meaningful public involvement and to peaceful resolution of the conflict. Another difficulty is the often negative effect of local communities having ineffective internal leadership. Finally, the dynamics of conflict can be significantly affected by the reactions participants have to their degree of access to resources and information based on their gender, culture, values, and history. All these factors need to be taken into account when designing a meaningful participation or conflict resolution process.”129

Monitoring and Evaluation For the past 30 years, the Costa Rican indigenous community has lived under the insecurity of losing tribal lands due to the Boruca Dam Project. To some Costa Ricans, it is a promising answer to power shortage problems and promises ecotourism and employment opportunities. To others, it is a corrupt idea that was only cooked up to serve the interests of the politicians, to pay back bad debts, and to create revenue for Costa Rica at the expense of the people. Despite the controversy, it appears that the majority of Costa Ricans believe the dam will be built.

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“The many approaches, process steps, and tools for public participation and conflict resolution are based on a set of principles which should be applied to all processes concerned with building dams or their alternatives. These practices stem from first principles that the public should have meaningful and continuous voice in decisions that affect their lives, and that their participation should have an impact on the decisions. For the resolution of conflicts, decision makers should take into account that differences and disputes are normal. Although every culture has its own ways of resolving disputes, better decisions emerge when diverse interests, knowledge, and expertise are brought to bear on complex problems such as watershed management and large dams or their alternatives. Public participation and conflict resolution processes should be evaluated regularly. Evaluation allows decision makers to learn if both processes and outcomes are accomplishing the goals set out for them and to gather information to improve future projects.”130 The PNE should be enforceable and have a clear plan for monitoring and regular evaluation. ICE needs to undergo a similar internal process of building communication between departments, in particular methods for direct consultation and involvement in the creation of the Generation Expansion Plan from all departments within the company, especially Research and Development. ICE’s Expansion Plan should be guided directly by MINAE’s PNE and should include projects for alternative energy research and development, so that alternative energy development is funded appropriately. One initiative underway at ICE is the creation of a coordinating position that will ensure ICE’s compliance with the National Energy Plan. At the same time, MINAE and/or ICE should create a mechanism to receive complaints and assure compliance with commitments. In the following sections, the major players in the conflict will be examined and an aid package based on protecting the rights of the indigenous population with the dam as a reality, not a subject still under government debate, will be analyzed.

Dividers and Tension Builders The largest dividers in the conflict over the Boruca Project are ICE and the Costa Rican government. While these two organizations share the common goal of building the dam, they have not always been allies. Several years ago, the Legislative Assembly debated the issue of privatizing the electric and telecommunication industries, an idea which inflamed employees of ICE. On a smaller scale, it can be argued that ICE and the Republic of

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Costa Rica have different interests in the Boruca Project, which overlap only in small areas. The Republic of Costa Rica, for example, may hold a strong interest in clean burning energy, but it can be argued that their interests in the dam are more economical than altruistic. Critics argue that the hydroelectric plant is being built not to solve an energy crisis but to support the power needs of the aluminum bauxite plants owned by the Aluminum Company of America (ALCOA). It is also alleged that ALCOA moved their plants to Costa Rica from Surinam due to political pressure in the latter country over the mishandling of another dam project, the Brokopondo Project, which displaced thousands of indigenous peoples and delivered on few, if any, relocation promises. Critics also allege that only 15 percent of the dam’s power can be used by Costa Rica, the rest will be outsourced to other countries for an economic boost. While strengthening the economy is a novel goal, many indigenous rights groups expect that it will happen at the expense of their population, very few of which will ever see the benefits of the upswing in the economy. Another issue surrounding the Costa Rican government is a perceived history of corruption and reneging on promises. The government run organization, CONAI (National Commission on Indigenous Issues), has represented the indigenous needs so poorly that many refuse to even acknowledge its legitimacy. In recent years, the lack of any concrete “relocation” plan for the affected indigenous communities has created even more mistrust. Even the general public has had issues with trust as the government continues to make what is perceived as poor economic decisions. Several times the Colón has been devalued while the Costa Rican government continues to invest in expensive infrastructure projects. Recently the former president of Costa Rica and the Organization of American States, Angel Rodriguez, was arrested under corruption charges. Among the accusations were that Rodriguez and former ICE director José Antonio Lobo took bribes from a French telecommunications company wishing to expand into the region. Rodriguez is also accused of taking bribes during the bid process for other large projects. ICE, while criticized, may have a better reputation than the Costa Rican government. Generally it seems that ICE in some ways is committed to stronger, cleaner energy for Costa Rica. Just recently ICE has secured government cooperation on a project they are pursuing with MIT to provide hydrogen power to the region. Hydrogen power in this case will be

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harnessed from water sitting in hydroelectric dams during the evening hours when the dam is not in operation. The energy can be stored and used later or even converted to power for specially designed buses and cars. ICE is also interested in solving the energy crisis for Costa Rica. They see hydroelectric power as an untapped resource, one that can be instituted quickly to meet needs before energy runs out. They have also remained open to outside feasibility studies and have begun to work closer with indigenous representatives to mitigate impacts for the population. ICE, however, has caused tension in several areas. First they have been criticized for using “doomsday” tactics in their ad campaign for the Boruca Project. Secondly, they have allowed some testing to be done in indigenous lands without consent, an act that has created anger and mistrust. Finally, ICE has not pressured the Costa Rican government to provide concrete relocation details, an act which only fuels mistrust. Another, smaller player in the project is the World Bank. The World Bank is coming under increasing criticism for its funding of major dam projects in many countries, which have displaced citizens with little or no benefit to the region. Currently, the World Bank has begun to scale back on its funding of these dams and is trying to shift focus onto protecting and improving current dam situations. They also have funded wind power projects in Costa Rica during the 1990s as alternatives to dam creation. Despite these changes, it is important to note that the World Bank is a major financier of these projects, which arguably is an “approval” of any negative actions surrounding them. The largest players on the other side of the project are the indigenous populations that are resisting the creation of the dam. The most active population is the Rey Curré of Boruca who will be displaced by the creation of the dam. Most of the indigenous population shares the interest that they are not relocated, or if they are, they are provided the best possible land and resources they can have. Furthermore, most indigenous peoples are committed to protecting their lands and sacred places and the creation of more opportunities for their people. Where the interests split, however, is with the older and younger populations. Many of the younger residents are interested in the possible benefits of the dam; ecotourism, employment opportunities, government grants for schools and improvements. The older population is less trustful of the government’s promises and points to the fact that no viable relocation plans have been offered at this time. Outsiders also have noted that employment opportunities offered may be at a higher

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skill level than that of most of the population, shutting them out from benefits. Furthermore, the older population argues that ecotourism may lead to the further exploitation of the land rather than provide benefit. The majority, nonindigenous population of Costa Rica should also be counted as a player in the conflict. While the general population may be interested in protecting the culture and history of their native people, they are also committed to sustainable energy for the region. If the information provided by ICE is true, they are facing an energy crisis which may leave them without power in the next ten years. It is hard to imagine that the majority of the population would want to face energy shortages to protect the culture of a small percentage of the people. An alarming trend toward racial violence is increasing tension, as several acts of abuse have been committed against the indigenous population. It appears that without intervention, the worlds of the regular population and the indigenous populations will continue to drift further apart.

Connectors and Local Capacities for Peace (LCP) The indigenous population has done a wonderful job in recent years of channeling their protest against the dam into productive community based action coalitions. These local community groups have been able to organize large demonstrations as well as detailed, published objections to the project. They have also brought knowledge to the community, providing solid information on the project’s faults and value. This education process has allowed most community members to understand what the dam means to their community and what impact it may have on their families. Alongside the indigenous population are the several LCPs that are working to provide conflict resolution between the parties. One such LCP is the NGO the Center for International Justice and Law (CEJIL), which is working to protect the rights of the indigenous population, particularly the rights to the land they live on. CEJIL would like to see indigenous rights further strengthened through government policy and jurisprudence in the Inter-American court system. Other LCPs, such as the Kan Tan Project, further facilitate peace by preserving the indigenous culture threatened by the Boruca Project. They also work as educators by integrating outsiders with the indigenous population, which informs the community about Boruca and their people. Of overall importance is structuring the program so that it will reduce the tension being created by the dividers and to compliment the help being

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offered by the LCPs. Equally important is structuring the program in such a way that it encourages cooperation from the dividers rather than alienation by demonizing their actions. One of the most important pieces of the program would involve research into previous mistakes made in large dam projects. For example, the relocation efforts in the Surinam Brokopondo Dam project forced the population into extreme poverty as promises of jobs were not fulfilled. Also large-scale projects often produce unforeseen effects. Hardships were increased in Surinam when it was discovered that the relocation lands were unsuitable to preserve important resources such as medicinal and food plants. Dam efforts in many regions have caused an unforeseen drop in the health and quantity of fish, creating problems for populations living downstream. This project calls for a survey of negative impacts in large dam projects along with an action plan to avoid similar problems in the Brunca Region. Of particular value can be information already readily available from the World Commission on Dams. Below are some preliminary programming options which seek to reduce tension in the region: 1. Encouragement of meaningful community involvement in the Boruca Dam Project: The tension caused by the Costa Rican Government and ICE can be reduced by ensuring that there is meaningful indigenous involvement in the project. Meaningful involvement would entail community representatives involved in every stage of the project, and who carry “voting” power for proposed changes and plans. These representatives should not be put in a position where they have minority involvement, but rather a real say in how things progress. These representatives should also have access to all material showing alternative plans, relocation efforts, and any negative impact studies. ICE should be encouraged to provide unlimited access to the representatives to diminish mistrust. In turn, this involvement from the community would give ICE and the Costa Rican Government the opportunity to rebuild bridges between the two parties and, in the long run, allow for a smoother implementation process for the dam project. The increased trust will also allow LCPs such as CEJIL the opportunity to convince the indigenous community to seek out legal protections that are readily available to them. 2. Creation of public and detailed plans for relocation: Detailed plans must be made for the relocation and must be made readily available to

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the indigenous community. Among these relocation plans should be a contract between the community and the government ensuring that the lands should be of equal or preferably better value than the old lands. The new lands provided should also allow the population to continue in a traditional lifestyle. Important plants and wildlife should be available and thriving in the new location, land should be of the same grade (no movement into hilly or unsuitable regions), and materials for both traditional and modern homes should be available. These lands should also allow for the full privacy and autonomy of the indigenous community. No person should be forced to “integrate” into a mainstream society, or have a large modernized city right on their doorstep. The publishing of these plans should help to reduce tensions over the project by providing the community with a clear picture of their future. 3. Protection of health and welfare: The government should provide plans to protect the health of the people living in the region before and after construction. Of major concern are diseases such as malaria, which can be increased by the changes in the water flow caused by damming the river. Protection, education, and vaccination should be provided free to the population living there. The government should make full use of studies available regarding health problems caused by large dams and take every measure to avoid them. In addition, the welfare of the people must be considered as well, especially the younger residents who may be lured into prostitution, which typically has surrounded the construction phase of these projects. Particular emphasis should be placed on education about scams and other efforts that might exploit the population. 4. Job creation and educational opportunities: Providing real, viable employment opportunities to the indigenous peoples is of utmost importance. There needs to be immediate disclosure of job opportunities for the indigenous population, along with an oversight body to ensure that the community is not exploited with poor conditions and long work hours. Also the government should continue in its efforts to provide new schools and educational opportunities to the community. Among these educational opportunities should be programs focusing on life skills, money management, domestic conflict resolution, and health improvement. 5. Cultural sensitivity programs: Programs should be created to bring the indigenous culture into the mainstream public. This can be facilitated

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through museum exhibits, media programs, and hands on work. By celebrating the indigenous culture, these programs can create better awareness of the indigenous plight and subsequently “ownership” of the indigenous culture. 6. Cultural preservation programs: Along with sensitivity programs, efforts should be made to preserve the culture of the indigenous populations. Of utmost importance is finding a solution to the issue of burial lands, which may be lost due to flooding. Equally important is ensuring that indigenous religious practices are undisturbed in the new location. These efforts should include indigenous leaders and be carried out with the greatest sensitivity. By showing that indigenous culture is important, tensions can be reduced. 7. Providing ICE access to lands: Part of the overall program should include an effort to slowly introduce ICE into the region. Formal requests should be submitted to indigenous leaders to enter the land and do testing. “Ownership” rights should be emphasized and ICE should respect that the land is owned by the indigenous populations. By using more diplomatic measures ICE may end up with better access and smoother relations with the region. The programming options above will also aid in strengthening the connectors and LCPs. Once trust is rebuilt the indigenous people will be more open to help from outsiders. Also, once some of the fears of the local population are erased (such as where are we going to live?) it will allow LCPs more time to focus on other important issues they will face during the construction phase. After trust has been rebuilt, efforts can be made to protect the indigenous community in other ways: 1. Creation of local government: This program will seek to work with the Republic of Costa Rica, indigenous leaders, and LCPs to create a local government for the indigenous people. As with Native American populations in the United States, the indigenous populations should enjoy a moderate level of independence. Local laws and regulations should fall within the scope of Costa Rican law but can remain unique to the population. 2. Protection of new lands: All lands earmarked for relocation should be awarded preserve status and protection against encroachment by outsiders.

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3. Legal protections: This program will seek to work with the Costa Rican government, indigenous leaders, and LCPs to find ways to strengthen the Indigenous Act of 1977 and existing land ownership laws. In addition, the program will seek to strengthen laws, which will stop the illegal selling of indigenous land to outsiders. These scams only weaken the population and provide few economical benefits. 4. Creation of an indigenous fund: The program will seek to work with the Costa Rican government to provide a fund to improve the living standards of the indigenous population. A portion of the revenue from selling surplus energy created by the dam should be rolled into this grant fund to ensure the population most affected receives a large portion of the benefits. 5. Sustainable ecotourism: As ecotourism appears to be a widespread interest among the indigenous population, this program will seek to work with the community to create sound economic opportunities. The program will call upon expertise from several LCPs and NGOs to find ways in which to bring ecotourism into the region that will have minimal negative impacts on the environment. Efforts should also be made to ensure that revenue from these opportunities goes directly back into the population. While the Boruca Dam Project has created a great deal of tension, it is not too late for all sides to rebuild trust and re-open communication. All efforts should be made to convince the indigenous population to focus more of their energy into protection of their rights with the dam as a reality. As the indigenous community focuses more on the reality of the dam project, they can ensure that their voice is heard. Several countries with large dam projects have not considered the needs and interests of the affected peoples. The Costa Rican government and ICE at least, seem ready to negotiate with the Rey Curré community and offer up meaningful involvement. This is an opportunity that the indigenous population should not pass up.

Endnotes 1. Anderson, Rolf., 2006. “‘Case Study’ Costa Rica Load Management Program,” World Efficiency Association, San Jose, Costa Rica. 2. Beck, F. and Martinot, Eric., 2004. “Renewable Energy Policies and Barriers,” in Encyclopedia of Energy, Cutler J. Cleveland, ed., :Academic Press/Elsevier Science,

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3. Anderson., 2006. 4. Riley Dohn and McLaughlin, Mark., 2001. “Turning the Corner: Energy Solutions for the 21st Century,” Alternative Energy Institute, Tahoe City, CO. 5. Martinot, Eric, “Renewable Energy Investment by the World Bank,” Energy Policy, Vol. 29, 2001. 6. American Wind Energy Association & European Wind Energy Association, 2004. “Global Wind Energy Report,” American and European Wind Energy Associations. 7. MINAE., January, 2002. “Texto Antecedentes e Inventario de Recursos Para el Incremento de las Fuentes Renovables de Energia,” San Jose, Costa Rica: MINAE. 8. Komor, Paul., 2004. Renewable Energy Policy, Universe Inc., Lincoln, NE. 9. MINAE., 2002. 10. Echavarria, M., 2002. “Water User Associations in the Cauca Valley, Colombia. A Voluntary Mechanism to Promote Upstream-Downstream Cooperation in the Protection of Rural Watersheds,” FAO Land–Water Linkages in Rural Watersheds Case Study Series, Rome: Food and Agricultural Organization of the United Nations. 11. Chaves Solera, Marco, 2003. “Produccion de Alcohol Carburante (Etanol) en Costa Rica: Consideraciones Sobre su Potencial Real de Uso,” Direccion de Investigacion y Extension de la Cana de Azucar. http://www.infoagro.go.cr/ Agricola/tecnologia/ATACORI.pdf. 12. For an in depth analysis of biofuel production in the US context that could easily be transferred to Costa Rica see Greene, Nathan et al. Dec. 2004. Growing Energy: How Biofuels Can Help End America’s Oil Dependence. Natural Resources Defense Council. 13. Huttunen, Suvil and Lampinen, Ari., 2005 “Bioenergy Technology Evaluation and Potential in Costa Rica,” University of Jyvaskyla/Department of Biological and Environmental Science, Jyvaskyla, Finland. www.jyu.fi 14. California Energy Commission, June 5, 2003 “Comparative Cost of California Central Station Electricity Generation Technologies,”, Final Staff Report: California Energy Commission, 15. United Nations University, 2007. 16. Solarbuzz, “Fast Solar Energy Facts,” 2005, www.solarbuzz.com/FastFactsIndustry. htm. 17. REN21 Renewable Energy Policy Network, “Renewables 2005 Global Status Report,” Washington, DC: Worldwatch Institute, 2005. 18. Kanellos, Michael, “With Hefty Finding, Solar Start-Up Takes On Big Guns,” The New York Times, New York, NY, Wednesday, June 21, 2006. 19. Beck and Martinot., 2004. 20. Martinot., 2001. 21. Nandwani, S.S., “Use of Solar Radiation for Day Lighting, Water Heating, Cooking and Night Illumination in the Author’s Energy-Conscious House,”

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22. 23. 24. 25. 26. 27. 28. 29. 30. 31. 32. 33. 34. 35. 36. 37. 38. 39. 40. 41. 42. 43. 44. 45.

46.

CONFLICT RESOLUTION OF BORUCA ENERGY PROJECT Proceedings of the International Conference LUX PACIFICA 97, Nagoya, Japan, October, 1997. Wright, Jaime., “Mapas de Radiacion Solar en Costa Rica,” Top. Meteoro. Oceanog. 9 (2), 2002. UNEP-DDP., 2004. “Financing Dams and Sustainable Development,” Issue Based Workshop No. 3, London, UK. Janssen, Rodney (ed.), 2004. “Renewable Energy . . . Into the Mainstream,” International Energy Agency’s Renewable Energy Working Party: IEA. Janssen., 2002. Ibid. Berinstein, Paula., 2001. Alternative Energy: Facts, Statistics, and Issues, Westport, CT: Oryx Press. REN21., 2005. Ibid. Ibid. ICE, 2004. Energy Information Administration (EIA), December, 2001, “Annual Energy Outlook 2002.” International Energy Agency (IEA), 2006 “Energy Technology Perspectives: Scenarios and Strategies to 2050,” Paris: IEA. IEA., 2006 a “Renewable Energy: RD&D Priorities,” Paris: IEA. World Bank, 2006 “The World Bank Renewable Energy Toolkit—Renewable Energy Rationale.” www.worldbank.org/retoolkit/. Martinot, Eric, “Renewable Energy Gains Momentum: Global Markets and Policies in the Spotlight,” Environment, Washington, Vol. 48, Iss. 6, Jul/Aug 2006. World Bank, 2006. Martinot, 2006. Martinot, 2006. British Broadcasting Corporation (BBC), “Sweden Aims for Oil Free Economy,” BBC News online, February 8, 2006. World Bank., 2006. Grupo Corporativo Saret., 1999. www.gruposaret.com/. Mesoamerica., 2006. www.mesoamerica.com/ing_mesoenergy.shtml. Lipp, Judith and Cain, Seth, November, 2005. “The Energy Accounts for the Nova Scotia Genuine Progress Index,” Nova Scotia, Canada. European Commission, 2003. “External Costs: Research Results in SocioEnvironmental Damages Due to Electricity and Transport,” Luxembourg: Office for Official Publications of the European Communities. europa.eu.int/ comm/research/energy/pdf/externe_en.pdf. Kobos, Peter H.,. Erickson, Jon D., and Drennan, Thomas E., “Technological Learning and Renewable Energy Costs: Implications for US Renewable Energy Policy,” Energy Policy, 34(13), September, 2006.

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47. Lovins, Armory, “Designing a Sustainable Energy Future: Integrating Megawatts with Diverse Supplies at Least Cost,” The Business of Energy Efficiency: Australia’s First National Energy Efficiency Conference, Videoconference Keynote to Melbourne, Rocky Mountain Institute, Snowmass, CO, November 13, 2003. 48. Janssen, 2002. 49. World Bank, 2006. 50. Beck and Martinot, 2004. 51. REN21, 2005. 52. Castro Salazar, Rene and Pinchansky, Sarah Cordero, 2002. “The Emerging Global Climate Market: The Costa Rican Dilemma,” Climate Change and Development Case Book: Cases in Latin America Related to the World Market Integration of Atmospheric Carbon Reduction Services and Clean Energy: UNDP. 53. Caspary, Georg and O’Connor, David., 2002. “Policy Brief No. 21, Beyond Johannesburg: Policies and Finance for Climate-Friendly Development,” OECD. www.oecd.org/dataoecd/3/45/1945499.pdf. 54. Carbon Positive, 2007. www.carbonpositive.net/. 55. World Bank, 2006. 56. Ibid. 57. UNEP, 2004. 58. Ibid. 59. WCD, “Participation, Negotiation and Conflict Management in Large Dams Projects,” Final Report, Resolve Inc., March 2000b. 60. WCD, 2000b. 61. Ibid. 62. Ibid. 63. PNDP, 2002. 64. Ibid. 65. Ibid. 66. Hester, R. E. and Harrison R. M. (eds), 2003. Sustainability and Environmental Impact of Renewable Energy, Cambridge, England: Royal Society of Chemistry 67. Huacuz, Jorge., “The Road to Green Power in Mexico: Reflections on the Prospects for Large Scale and Sustainable Implementation of Renewable Energy”, Energy Policy, 33, June 2005. 68. Comision Economica Para America Latina y el Caribe (CEPAL), 2003. “Evaluacion de Anos de Reforma en la Industria Electrica del Istmo Centro Americano,” CEPAL. 69. ILO Convention 169, Articles 19 and 23, 1989. 70. Beck and Martinot, 2004. 71. World Bank, 2006.

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72. Janssen, 2002. 73. MINAE DSE, February, 2003. “IV Plan Nacional de Energia 2002–2016,” San Jose, Costa Rica: MINAE. 74. International Hydropower Association (IHA), “Hydropower and Sustainability”, 2004, http://www.hydropower.org/publications/leaflets_and_factsheets.html 75. IHA, 2004. 76. IHA, “Sustainability Guidelines,” February, 2004b, http://www.adb.org/Water/ Topics/Dams/pdf/IHA-Guidelines.pdf 77. Ibid. 78. Ibid. 79. Ibid. 80. Wall Street Journal, “Americas: Costa Rican Poverty Fighter”, New York, May 5, 2006. 81. CIA Factbook-Costa Rica, 2006, www.cia.gov/cia/publications/factbook/ geos/cs.html. 82. Costa Rica: Country Risk Summary, EIU ViewsWire, New York, 2006, http:// proquest.umi.com. 83. The Inter-American highway is the only well maintained road, most ancillary roads are unpaved and the paved ones are full of potholes. 84. USAID, 2004. 85. Chiapas-Based Center for Economic and Political Investigations of Community Action (CIEPAC), “Planned Pueblo Panama Spells Disaster for Mexico and Central America,” Organic Consumers Association, Chiapas Today, Bulletin #312, December 11, 2002, http://www.organicconsumers. org/chiapas/planned_pueblo_panama.cfm 86. Costa Rica—Economy, 2005. 87. Wall Street Journal, 2005. 88. Rankin, Nick, “Costa Rica’s Battle for Popularity,” BBC News online, 2006. http://news.bbc.co.uk/2/hi/programmes/from_our_own_correspondent/ 4997518.stm 89. O’Grady, Mary Anastasia, “Americas: Costa Rican Poverty Fighter,” Wall Street Journal, New York, 2008, http://proquest.umi.com. 90. CIEPAC, 2002. 91. The Environmental Impact Assessment done in 1990s was kept a secret by the government and they never provided a copy to civil societies or any other organizations. 92. www.oas.org, 2003. 93. WCD, 2000a. 94. Arcadia Field Analysis, 2007. 95. www.oas.org, 2003. 96. The World Conservation Union, Terraba-Sierpe Forest Reserve, Costa Rica, 2002.

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97. Procuenca, San Juan, 2004, www.oas.org/sanjuan/. 98. Boruca, Bribri, and Cabecar: History and Cultural Relations, 2008, www. Everyculture.com/Middle-America-Caribbean/Boruca-Bribri-and –Cab-carHistory-and-Cultural-Relations.html. 99. Mysore India Convergence Conference Lecture, 1997. 100. Ibid. 101. Murphy-Larronde, Suzanne, “Costa Rica’s Ecological Masks,” Americas, 58(3), Research Library Core, June, 2006. 102. Interview with Juan Carlos Morales, Arcadia University Field Study Analysis, 2007. 103. Canton: A division of a country [often political as well as geographical in its delineation]. 104. ICE., 2004. 105. Instituto Nacional de Estadisticas y Censo (INEC), Estadisticas Nacionales, San Jose, Costa Rica, 2000. 106. Coto, 2004. 107. Villanueva Villalobos, 2004. 108. CIEPAC, 2002. 109. Harken is the oil company operating at this site. The former U.S. president, George W. Bush, has strong ties to Harken as a former major shareholder and member of Harken’s Board of Directors. 110. Drillbits and Tailings, “Communities in Costa Rica Unite in Opposition to Oil Drilling, Drillbits & Tailings”, Vol. 6, No. 3, March 31, 2001. 111. Interview with Dr. Francisco Quintana, Arcadia Field Analysis, 2006. 112. “Central America’s Free Trade Gamble,” World Policy Journal 21(4), 2005. http://firstsearch.oclc.org. 113. Solis, L. and Solano, Patricia., 2001. “Central America: The Difficult Road towards Integration and the Role of Canada,” www.focal.ca 114. OmCED., 2003. “Accesibilidad al Justo Derecho para las Comunidades Indigenas de Costa Rica,” , San Jose, Costa Rica: OmCED. 115. Arcadia Field Analysis., 2006. 116. The doctrine of precedent, under which it is necessary for a court to follow earlier judicial decisions when the same points arise again in litigation. 117. Judgment of June 16, 2005. 118. Judgment of June 15, 2005. 119. Interview with Juan Carlos Morales, Arcadia Field Study, 2006. 120. Griffiths, Thomas, 2005 “Indigenous Peoples, Land Tenure and Land Policy in Latin America”, http://www.fao.org/docrep/007/y5407t/y5407t00.htm 121. USAID, 2005. 122. Morales, 2007. 123. Arcadia Field Analysis, 2006. 124. WCD, 2000b.

182 125. 126. 127. 128. 129. 130.

CONFLICT RESOLUTION OF BORUCA ENERGY PROJECT Ibid. Ibid. Ibid. WCD 2000. Ibid. WCD, 2000b.

5 Regional Development Implications in the South of Costa Rica Development Aspects for the Regional Indigenous Reserves in the South of Costa Rica Social Organization Social organization constitutes one of the most dynamic and definitive factors for rural development of the reserves. Understood in that is the banding together of different sectors of the indigenous population under aims and defined objectives as much economic, social, environmental, and political in scope. It is in this way that indigenous organizations fulfill different functions of transcendental importance in development processes; the management of basic services such as aqueducts, roads, housing, for example. In addition, organizations and associations have an important role in the reduction of poverty. Thus the integral development of indigenous peoples depends to a great extent on the efforts that they themselves make from their structure bases; their capacity as actors in development and as promoters of change will depend in large part on their strategies for uniting forces and for group cohesion as a cultural ethnic group. From there would exist a true process to better these peoples’ quality of life, which is essential to maximizing the organizational capacity of active forces and managerial potential as far as the planning, creation, and training of resources, allowing them to make their organizations and their work plans sustainable.1

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For many years, inhabitants of the indigenous territories have looked to organize themselves in order to more easily satisfy their development needs, and for that the method of organization has been vis-á-vis nongovernmental associations. Nevertheless, for strictly social reasons and those of organizational and managerial capacity, these organizations have not been able to satisfy expectations and have stagnated. Today, sources of economic support for these organizations do exist, but the organizations are required, among other things, to establish suitable credit with financial entities. This suitability includes having up-to-date legal certificates, legal capacities and accounting, as well as development experience with community projects, among other things. To ensure that organizations successfully complete these actions and affect development in an effective way requires learning and training processes. Strengthening of the local organization is the prime driver for change toward more horizontal processes of planning and implementation, and more influential forms of management. Job and professional training for local leaders allows them to develop new capacities and to improve productive processes. There is an identifiable need to strengthen management capacities of indigenous associations. Generally this learning is directed at the leaders of organizations (decision-making, administering), but it is also directed at members (information circulation) so as not to spawn internal conflicts. It allows the organization to work better and to react in a more effective way. Training in technical aspects of organizational management, such as meeting activity, information dissemination, managing administrative accounts, is recommended. However, the less-tangible aspects, such as conflict management, negotiating and team work, for example, should be dealt with in an effective form by the public institutions that support the organizations. A fundamental challenge for the indigenous organizations is to have more frequent orientations in public policy development and proposal writing. The negotiation of alliances with other groups is a useful way to increase associations’ capacity for influence. The lack of intended capacity and of local management on the part of existing organizations is a worrisome aspect. Yet, when interest by leaders and some organizations exists, these initiatives do not come to fruition. In this sense, an action of integral rural development happens precisely to facilitate this process of strengthening of intended capacity and local management. By means of the creation of analysis centers, leadership training

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initiatives and support for their initiatives, a “Pilot Project for Development of the Reserves” could contribute to resolving this deficiency. Particularly the young indigenous population lacks organizational centers and educational modalities that persuade to them to play a more active role in the area. Technical education is not designed to promote undertakings that allow youth to initiate and consolidate organizational processes toward the creation of permanent, quality jobs in local development. Local organizations have expressed limitations in their ability to act, as they especially look to improve communication between members and to improve the competencies of their leaders. In consolidating organizations, state support has been scattered, and in some cases, too paternalistic. An integral development focus must approach a new relationship with area social organizations, putting aside paternalism, clientelism, leadership, institutional authoritarianism, and other ill-advised methods. On the contrary, a horizontal and dialogical relationship of shared responsibilities between indigenous institutions and state organizations must be established as an indispensable condition in order to successfully approach a process of sustainable development.

Action Plan for Linking Indigenous Groups to State Influence z z z

z

z

Coordinate with state entities to provide for the training needs of the indigenous organizations. Encourage indigenous group members to participate in the training as an effective path toward meeting community goals. Make staff available within state programs who can help indigenous organizations in the acquiring, filling out, and transmitting of legal documents and administrative forms in order to assist these organizations in obtaining legal status. Equip these organizations with the means and infrastructure necessary to work from inside their own communities, to seamlessly interact with the state and nonindigenous groups for the promotion of their own goals and values. Make sure that each one of these organizations has the tools and information necessary to know where they stand and how state sponsored goods and services are accessed.

In addition, offer a process oriented toward the rescue, promotion, and popularization of the customs, traditions, and legends of these peoples, for instance, illustrated memories and other audiovisual materials, prepared

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by the communities themselves in their own languages, as well as in Spanish.

Local Services Local services must develop coordinated operations with the indigenous peoples, with the aim of promoting personal and cultural advancement and development. The following local services for the regional Indigenous reserves are recommended: z z z z z z z

Information and transparency on new projects such as “El Diquis” Food for those in need Small credit program Integrative health service Domestic violence project Teen pregnancy prevention program Payment of/for environmental services

Particularly, the payment of environmental services by protection of water resources, biodiversity, scenic beauty, and carbon fixation has constituted an element of development in the indigenous communities of Coast Rica. From the beginning of the “Environmental Services Payment Program” in 1997, the participation of indigenous communities has been incorporated. Above all, most of the indigenous communities are in protected areas that are the last strongholds of vast forests outside protected areas in Costa Rica. In the past, through the National Forestry Financing Fund (FONAFIFO), the following regional associations and indigenous peoples have benefitted from this system: z z z

ADI Salitre ADI Ujarráz ADI Cabagra

Other reserves are recommended to participate in this environmental service.

Training and Job Creation A fundamental challenge for development on the Buenos Aires Canton indigenous reserve is the identification of quality employment alternatives

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for the indigenous peoples, one that takes advantage of the resources and capacities of the population, as well as the possibility for contribution of public resources and international cooperation. Masks, purses, and others artisan handicrafts have constituted the principal source of income for the indigenous peoples of Buenos Aires. The attractive nature of the products and the prices at which they are sold to tourists in the markets in San José are motivating more indigenous peoples to opt for this method of making a living. But the sale of artisan handicrafts does not generate sufficient income for the development of indigenous reserves. It is necessary to create sources of income based on the use of local resources and the capacities of the peoples. The practice of conservationist agriculture and cattle ranching, and measures related to the protection of natural resources, such as water, flora, and fauna, are aspects of great importance in the general development of the region. They will not only protect the natural resources of the area, but also enhance touristic activity, especially ecological, agricultural, or rural community tourism. In addition, the importance of sustainable development is underscored, assuring perpetuation of the natural patrimony for future generations.

Potential Projects for the Indigenous Reserves Ecological and cultural tourist development could be undertaken with focus on the following areas: z z z z z z z z z z z z z z

Artisan development Organic farming Education in legislation related to indigenous interests Preservation of land and customs Housing programs Rural aqueducts Areas of forest conservation Road network program Natural medicine production Water security project in Buenos Aires Canton Environmental safeguards Community orchards Toasted banana project Regional collection and taxonomy of flora and fauna in cooperation with INBio.

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Action Plan An action plan should contemplate proposing the creation of a trusteeship that would allow the local indigenous government to finance the development of productive projects by organized groups, of goods or services. z

z z

z z z

Making available selling channels that would support a fair-trade market for the agricultural products generated within the indigenous territory. Proposing organic product production within the indigenous territories. Making available to these groups information and training materials so that they can generate goods and services that would create economic income for them and their members. Strengthening already existing productive activities in the hands of nongovernmental organizations (NGOs). Proposing implementation of organizational modalities, such as cooperatives, within indigenous territories. Expanding international cooperation in the implementation of projects of potential value for the peoples.

Courses on “success factors” for the indigenous communities are extremely important, focusing on the following: z z z z z z z z z

Communitarian conscience on the need to take initiative Motivation from inside the community Flexibility and capacity for adaptation Existence of social cohesion between community actors Capacity for dialogue, consensus building, and cooperation Manifesting leadership Previous successful experiences Problem solving Promotion of strategic alliances

It has to be remembered that education in these areas has not only been late in arriving, but of very poor quality, as are the education professionals, didactic resources, education budget, food, and infrastructure. This results in most of the inhabitants of these territories reaching education levels well below the national standards in the rest of the country. Local organizations consider training to be a priority, since they will need it to be ready to respond to the needs of their members and the

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demands of an evermore complex social environment. Training will allow them to better understand their own organization’s objectives. In addition, it will give them the necessary tools to be able to access information, mechanisms for more training, resources, and more unions.

Estimated Principal Training Needs of the Indigenous Groups z z z z z z z z z z z z z z z z z

Conflict resolution Leadership Formulation and development of communal projects Fiscal and accounting management of the organization Transmission of legal capacity Legal management of the organization Production and trade of agricultural products Tourist development Natural resources and environmental education Development of market for artisan goods Legislation related to indigenous interests Policies regarding the handling of public funds Legal training Productive options of the region Traditional understanding and values of other cultures Human Rights Preventive health care with natural medicine

Regional Development of the Indigenous Reserves “National Plan for Development of the Indigenous Peoples of Costa Rica”2 emphasizes the principal aspects of development of the indigenous reserves. Based on the following central axes of the PNDPI3 implementation of a “Pilot Project of Development of the Indigenous Reserves” is recommended, in consideration of regional policy and institutional support in the area: z

Promoting Participation: Promoting indigenous participation in effective decision-making among the different peoples for their own future, allows them to be equal, and like other sectors of the population, to decide on the adoption of policies, programs, projects and other actions that affect them directly, to decide on the rollout and evaluation of the same, and guarantees respect for the rights conferred upon them by the Indigenous Law and ILO Convention No. 169.

190 z

z

z

z

z

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Legal Framework: The legal framework should proceed from the most constructive and democratic manner and in a time interval specified by the parties (the government and the indigenous communities) so that the terms of ILO Convention No. 169 are instrumentalized by means of defining the appropriate mechanism of participation. Territorial Right and Right of Possession: Within the framework of reserve property and in which life develops, it must be guaranteed legally that the indigenous peoples and their families who remain in the indigenous community on the territory, exercise over the areas which they inhabit, right of possession, and to the government of the republic, corresponds the development of mechanisms that guarantee the effective protection of the property and possessory rights of the indigenous peoples, as held in ILO Convention No. 169 (Art. 14) and the Indigenous Law. Recognition of Values and Social, Cultural, Religious, and Spiritual Practices: The recognition and protection of values and their own social, cultural, religious, and spiritual practices, whenever these are compatible with the fundamental rights defined by the national legal system and with respect to internationally recognized human rights, in particular with respect to the indigenous peoples’ own ways of resolving conflicts (Art. 9 of ILO Convention No. 169). Defense and Protection of Environmental Resources: Although Article 15 of ILO Convention No. 1694 mentions the rights of peoples interested in the existing natural resources on their land and under their protection, understood in that is the right to participate in the use, administration, and conservation of these resources; however, the practical relation indigenous communities establish with their natural surroundings is wider; it is with the environment in the manner in which they treat issues such as water and soil contamination, deforestation, hunting and extraction of flora and fauna, water sources, management plans, environmental legal framework, deterioration, and use of natural resources (flora and fauna). Promotion of Intercultural Bilingual Education: As established in Article 26 of ILO Convention No. 169, a measure must be adopted to guarantee the members of interested peoples the possibility of having an education at all levels, at least at a level on par with the rest of the national community, in their own language. Health Services Adequate to the Traditions of Indigenous Peoples: It is well known that the health service benefits directed at the indigenous population is not adapted to their needs and traditions, having strong repercussions on their quality of life. In this sense, ILO Convention No. 169 is clear when it indicates that the governments must make sure

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z

z

191

that suitable health services are made available to the interested peoples, so that they may enjoy the highest possible level of physical and mental health. Increased Access to Justice and the Judicial System: Article 9 of ILO Convention No. 169 is clear in indicating that authorities and courts called upon to pronounce judgment on penal questions must consider the customs of these peoples in the matter. In this sense, one considers that official jurisdictional bodies will proceed to design and execute actions aimed at guaranteeing a suitable defense of indigenous peoples in legal processes, promoting that the customs of indigenous peoples be taken into account when pertinent. On the plane of protection against the violation of their rights, Article 12 of ILO Convention No. 169 indicates that measures will have to be taken in order to guarantee that the members of these peoples understand and be made understood in legal procedures, facilitating to them, if necessary, interpreters or other effective means.

Quality of Life Improvement for the Indigenous Peoples (PNDPI 2002) z

z

z

z

z

Redesign of educational programs so that they include subjects related to the peoples’ history, language, culture, values and, in general, its identity, in order to save and preserve that identity. The Ministry of Public Education shall be in charge of this redesigning, together with the participation of the indigenous population. Develop an integral plan of attention to indigenous education, one that would contemplate not only the readaptation of educational programs to the conditions of indigenous culture, but also improvements to the infrastructure and complement of equipment and materials that would guarantee at a minimum, an education under equal conditions. Extend and consolidate training programs within the indigenous population, so that, under the charge of the health sector, they might be able to offer preventive medical services and basic health services in combination with traditional medicine. Work together within the health sector, so that in the context of integral health, problems regarding drug addiction and alcoholism are treated. Coordinate with the National Institute of Women and the National Board for Childhood to study and address intrafamiliar violence. Ask the National Drug Council (CONADRO) for support, so that through institutions and executive entities, a special action plan may be developed to address the problems of drug consumption and production and the problem of “chicha” in the indigenous territories.

192 z

z

z

z

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Develop programs of citizen security in the indigenous territories that respect the cultural identity of these peoples. A model to be taken under consideration by the population is the program of community policing that was developed by the Ministry of Public Security. Develop and execute a program of technical assistance in farming, in accordance with the actual production needs and eventual alternatives according to the indigenous territories’ own potential. The farming sector would be responsible for program development. Develop a credit program adjusted to the people’s own conditions of property and land possession, so that the indigenous population may have access to financing, and maintain and improve production. It would also be run by the farming sector in coordination with banks and other national and regional financial entities. Guarantee that public institutions offer equal treatment in benefit of services to the indigenous population, as mandated by Costa Rican law. La Defensoría de Habitantes could be responsible for this action. Establish small production companies in the indigenous territories, mainly directed at the creation of artisan handicrafts and other objects that, besides reproducing their culture and identity, would also be marketable. This action must be coordinated by several institutions, principally, the Ministries of Culture, of Work and Social Security, and of Agriculture and Cattle Ranching, as well as by the National Institute for Learning.

The emphases of a regional “Pilot Project for Development of the Indigenous Reserves” should be placed in the following areas: z z z z z z

Social organization Training and job creation Infrastructure program Program of production projects Local services Legal Framework and Human Rights

In order to finance this pilot, project it is necessary to consider traditional sources of international cooperation that direct and develop programs and projects for the indigenous peoples, such as: z z

The United Nations Development Programme (UNDP), The World Bank,

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The Inter-American Development Bank (IADB), The European Economic Community (EEC); RUTA, JUDESUR, Fundecooperación, The Canadian, Dutch, Japanese, British, and German embassies.

It would also be helpful to identify new sources of international technical and financial cooperation with the aim of establishing alliances or conventions by which the needs of indigenous peoples are given representation. This development initiative of the indigenous reserves should be seen as an integrated part of other regional development approaches, such as: the hydroenergy project El Diquis, the establishment of a regional airport, the construction of a new regional hospital, and regional ecotourism opportunities.

An Aid Program for the Boruca Region Any policy or aid packages created to address this conflict should take into consideration that a hydroelectric project will eventually be built. At this time, it is best for the indigenous population to shift focus away from protest and toward protecting their rights. The aid package outlined below was designed to focus on the prevention of abuses and ensuring the benefits of the dam are realized for the community. It also draws on the lessons learned from other large dam projects to avoid similar mistakes in the Boruca Region. The mandate of this program is simple—protection of the human rights of the indigenous population before, during, and after the construction of the Boruca Dam. Among the rights protected are economic, land, selfgovernance, and educational rights. The program also seeks to find further opportunities for the community to grow, through government land improvement grants, foreign investment and sustainable, nondamaging ecotourism opportunities. The ultimate goal of the program is to build trust between the indigenous community and the Costa Rican government. Instead of acting as an intermediary, the program would seek to build bridges between the two groups so that they rebuild a trusting relationship. The program would seek funding through the Costa Rican government, local NGOs, charities, and foreign governments interested in the

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protection of indigenous rights. The program would also work closely with NGOs already in the region, in addition to ICE and government representatives, to provide the best resources and solutions for the indigenous population. The benefits of this program would be reached in several ways: 1. Legal Protections: By working with the already established Indigenous Act, this program would seek to provide legal action against violations and protection against future violations. It would also seek to lobby for improvements in enforcement of the act as well as protection against the purchase of the land by nonindigenous persons. Furthermore, the mandate would seek to strengthen the act by lobbying to remove legal ambiguities, which allow the indigenous population little right to their own lands. 2. Governance Protections: This mandate would provide the indigenous population a stable and balanced form of self-governance, which would allow them to have autonomy and input to protect the well-being of their community. Self-governance rights should be awarded with the understanding that the indigenous peoples will cooperate with the Costa Rican government to ensure basic rights are protected for all. 3. Government Grants: Full advantage should be taken of government offers for improved education and lands for the indigenous peoples. A full disclosure of the relocation efforts should be given with several alternatives so that the community can pick the best options for themselves. 4. Job and Economic Opportunities: The organization will provide that several job initiatives should be taken to ensure that the indigenous population is given the best chances possible. Construction jobs should be monitored to ensure that they are safe and at the skill level of the population. Exploitation of the lands through tourism should be avoided and instead replaced with educational tourism slated to provide knowledge of the population. All revenue from ecotourism should go back to the community. 5. Resource Protection: Resources should be protected at all times within the dam region and the relocation areas so that no land or resource may be exploited. Particular attention should be given to the illegal selling of indigenous lands. This practice should be stopped and the offenders should be prosecuted.

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Endnotes 1. 2. 3. 4.

Ministerio de Agricultura y Ganaderia, http://www.mag.go.cr/ PNDP, 2002. Ibid. For complete text of ILO Convention No. 169, referenced throughout this section, see “Appendix II: Legal Instruments Referenced.”

6 Conclusions on Main Themes and Issues In this concluding chapter, the main themes and issues discussed in detail throughout the book will be presented and summarized. The hypotheses outlined were the following: (1) Energy needs and production are increasing in the region. (2) Alternative energy options are feasible in Costa Rica. (3) Regional indigenous development opportunities in the south of Costa Rica exist. (4) Conflict resolution of the Boruca Hydroelectric Project is possible.

Energy Needs and Production Are Increasing in the Region The increase in electricity consumption in Latin America has averaged 5% per year since the 1990s. For this reason, the area has become one of the world’s hotspots for hydroelectric development projects. One hundred and twenty hydroelectric projects are being constructed in Latin America. Energy demand and production is increasing in the region; however, there are limitations due to the conditions of each country as well as restrictions based on local situations. In this context, demand reduction and energy-saving tactics are also necessary to meet electricity demand. A renewable market development agreement must include energy delivery according to needs, price stability, increases in local job opportunities, and development goals, as well as decreased carbon generation, improved green image, and financial support for the achievement of these objectives. This situation requires not only rethinking the design of electricity projects but also the public process by which the designs are conceived and implemented. 196

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Costa Rica generated 98% of its electricity from renewable energy sources; 80% hydroelectric, 15% geothermal, 3% wind, and 2% from fossil fuel combustion, making Costa Rica by far one of the most clean electricity sectors in the world. Unfortunately, Costa Rica is losing its leading role in clean power. According to the latest operational plan (2002), by the year 2020, hydroelectricity will decrease to 67% and fossil fuel will increase to 29%, while other sources will only account for 4%. None of the expansion scenarios include a significant role for other alternative energies such as solar or biomass. The Costa Rican electricity sector faces a number of pressures from changing global and regional regulatory trends. The Central American Free Trade Agreement (CAFTA) requires liberalizing energy markets and the Central American Wholesale Electricity Market will also come into effect. This greater cross-border grid connection will open up Costa Rica’s electricity sector to competition from neighboring countries. Hydroenergy production is an option for producing energy but on balance, the potential impacts of large dams such as the Boruca Dam are more negative than positive on both environmental and social terms.

Alternative Energy Options Are Feasible in Costa Rica A number of factors are driving the current global renewable energy boom, for example, the passage of the Kyoto Protocol, growing awareness of global carbon constraints and the high prices, security risks, and international conflicts associated with fossil fuel energy. The most important driver may be the falling costs of renewable energy. The economics of alternative energies are improving rapidly as the technologies mature, the industry grows, and the costs of conventional fuels increase. Due to strong policy support renewable energy is growing very fast. A series of countries including 14 so-called developing countries have some type of renewable energy promotion policy program. Europe plans to make 22% of its electricity with renewables by 2010. Sweden plans to be oil-free by 2020 and in Germany, the alternative technology energy market is booming. Developing countries receive about $500 million each year in development assistance for renewable energy projects, training, and market support. The World Bank Group is committed to a target of at least 20% of average growth annually in both renewable energy and efficiency lending over the next five years. Costa Rica needs to rethink the energy project design by taking into account not only the financial viability of a project but also the environmental

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and social costs of power production. Full-cost accounting taking into consideration externalities are therefore essential to promote optimal economic efficiency of alternative energy production. Committing to a fossil fuel–free generation plan would create a more dependable, secure, and less expensive electricity system in Costa Rica than the current national generation plan. A clean power plan is well within the proven resource potential of the country and the capabilities of the energy sector. The cheapest source of nonconventional energy is most often conservation, through efficiency and demand management programs, which so far cannot be observed in practice. An 11% reduction in power demand by 2025 through demand management programs is a realistic approach. There are a series of options available such as public campaign to save energy, load management, real time pricing, and industrial and appliance standards. Focusing on reducing peak load can significantly reduce utility spending on new capacity. New efficient technologies would increase these savings. New metering technologies also allow for real-time pricing, which can significantly lower peak energy demand. The Costa Rican electricity system is well structured to enact efficiency measures because Instituto Costarricense de Electricidad (Costa Rican Institute of Electricity) [ICE] does not struggle with split incentives. The mandate of this public company is to provide the public service of electricity as cheaply and efficiently as possible, not to make a profit. With the CAFTA agreement, however, this of course will change. Alternative energy technologies, namely solar, wind, biomass, and geothermal, are underutilized in Costa Rica’s energy sector. All of them are economically viable when life cycle social and environmental costs are considered. Today Costa Rica is doing very well and generates 98% of its electricity with renewable resources. However, if the country follows ICE’s present expansion plan, the country will move to 17% fossil fuel generation, which will cause environmental, security, and price crises in the future. It is recommended to make use of the alternative energy potentials of the country and revise the current expansion plan. The emerging global carbon markets represent a very important financing opportunity for renewable energy in Costa Rica. The country has already proven that it is very capable of handling these types of projects. It was the first developing country to build “Joint Implementation Projects” under the Kyoto Protocol.

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The overarching barrier to the increase implementation of alternative energy in Costa Rica is a lack of strategic vision and coordination within the electricity sector. The primary players in the country must define a coordinated national level “sustainable energy strategy”. The strategy must include a strong monitoring system and frequent evaluations to ensure implementation. With such a strategic vision proper legal, regulatory, institutional, financial, and technical infrastructure can be created or reinforced to encourage large-scale and sustainable energy in Costa Rica.

Regional Indigenous Development Opportunities in the South of Costa Rica Exist The situation of the indigenous peoples of Costa Rica is definitely precarious, and it is unacceptable that these communities continue to live under systems of marginalization and absolute poverty. The Costa Rican government must take steps to clarify the legal structure and position of the indigenous peoples within the country and its reserves. An Indigenous Commission in the Legislative Assembly will be established and will lead the task of reviewing the existing legislation. This could include the change of the legal status of the communities and the integration of the reserves into regional development plans. Such an initiative would encourage cultural and ecotourism, mining opportunities, agriculture, and forestry systems. The practice of conservationist agriculture, cattle ranching as well as measures such as “Payment of Environmental Services” for the protection of natural resources, such as water, flora and fauna, scenic beauty, and carbon fixation, are of great importance for the development of the reserves. The Payment of Environmental Services in particular is vital for the protection of natural resources and constitutes an important element of development for the indigenous communities in Costa Rica. Social organization constitutes one of the most dynamic factors for the development of the reserves. It is understood that the banding together of different sectors of the indigenous population under aims and defined objectives should be economic, social, environmental, and political in scope. This includes having up-to-date legal certificates, legal capacities, and accounting, as well as development experience with community projects. The lack of intended capacity and of local management on the part of existing organizations is a worrisome aspect. Therefore the strengthening of local organizations is seen by the authors of this book as the prime driver for change toward more horizontal processes of planning and

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implementation of projects. By means of training, organizational support and assistance to establish local services an “Integrated Pilot Project for the Development of the Indigenous Reserves” is recommended. An integral development focus must approach a new relationship toward the nonindigenous population of the country, putting aside discrimination, paternalism, clientelism, institutional authoritarianism, and other ill-advised methods. On the contrary, a dialogical relationship of shared responsibilities between indigenous and nonindigenous organizations must be established as an indispensable condition, in order to maintain a process of sustainable development of the reserves in the region. In summary, the pilot development project should emphasis the following areas: Legal framework and human rights of the Indigenous Population z z z z

Social organization Training and job creation Program of production projects, and Local services

This pilot project should be seen as an integrated development approach taking into consideration the options of the new hydroelectric project, El Diquis, which will produce cheap energy in the region along with this development will be the establishment of an airport, construction of a new regional hospital, and increased ecotourism market options. On the basis of what has been outlined and recommended here, regional development opportunities of the indigenous population in the south of Costa Rica exist.

Conflict Resolution of the Boruca Hydroelectricity Dam Is Possible The Boruca Project has been chosen for this analysis as a case study because of the speculation generated by this project, the potential negative impacts of the dam, and insecurities, fears, and hopes of the main stakeholders involved in the project region. The dimension of environmental impacts outlined in detail such as loss of natural resources, particularly biodiversity, sedimentation of downstream areas, and erosion of soils due to deforestation reveal the potential environmental impacts of the Boruca Dam.

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Resistance of civil society groups and in particular from indigenous communities and environmentalists was evident during the long-term planning process of the project. Human rights, particularly those of the indigenous peoples, enshrined in both international and national laws and instruments have been violated and would have been further violated if the project was executed. A stakeholder mediation analysis has been used for identifying different positions and underlying interests of the parties involved. The mediation concept of positions versus interests can be used when thinking about how to design and implement projects. Taking into account each stakeholder’s position, it becomes evident that these positions may not reflect their desired outcome. Knowing stakeholder desires and tolerance allow for flexibility in planning and implementation. It is crucial to discover and understand each position’s interests, and why they hold the position they are presenting. The early involvement of all stakeholders invites dialogue and frames the argument around the positions, interests, and needs of stakeholders. By listening carefully to stakeholder positions, interests, fears and needs, through an atmosphere of confidence was successful in the Boruca Dam case. Listening was the essential element of confidence building. The conflict could have been resolved earlier and easier had the forum for an adequate discussion been available to the stakeholder right from the beginning of the planning process. The analysis assists in preparing the necessary arguments to either support the Boruca Dam Project or to rule against the project. It helps the parties to underline their positions and needs while the parties themselves will have to be ready to sacrifice some of their positions to facilitate an agreement. It was through these dialogues that the authors of this book understood the reasons behind the positions of the stakeholders and also the goals of the project. Finally, after a 30-year process of planning and discussing the pros and cons of the Boruca Dam, the interventions discussed in this document, underlined by increasing national and international resistance and pressure against the dam, the idea to build the dam was dropped by the government of Costa Rica and a smaller dam will be constructed in the region. The design of the smaller project El Diquis offers many advantages in comparison to the Boruca option as far as the size of the area flooded, relocation of people, environmental impacts, number of archeological sites affected, and finally the costs involved.

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The Boruca Dam example cannot serve as a model for other projects in the region because it has taken 30 years to decide not to construct the dam. Yet the conflict resolution of the Boruca Dam was possible. The stakeholder analysis and mediation framework applied during the last five years can be used for comparable project situations in the region.

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