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Portugal: The Dark Side of the National Dam Program

[All external links in Portuguese except when otherwise noted]

This article is a part of our special coverage Europe in Crisis.

The projects scheduled as part of Portugal's Programa Nacional de Barragens (National Dam Program) will cost the country's government €16 billion – to be spent on construction, subsidies and interest on loans. Together with wind farms, they are going to make Portuguese electricity the most expensive in the world, over the course of a few short years.

The first reactions to the construction of Portuguese dams came from environmentalists and locally affected populations, but lately, there has been more public debate about the inherent problems of the National Dam Program.

The submersed village Vilarinho das Furnas, Terras de Bouro. Photo by Flickr user Rosete Pereira (CC BY-NC-SA 2.0)

The submersed village Vilarinho das Furnas, Terras de Bouro. Photo by Flickr user Rosete Pereira (CC BY-NC-SA 2.0)

One of the most active and critical voices of the National Dam Program has been the President of Grupo de Estudos de Ordenamento do Território e Ambiente (GEOTA, or Study Group for Land Management and Environment), João Joanaz de Melo, who has pointed out problems that dam construction could cause and the errors transmitted to public opinion by official sources.

In an article published in January 2012, João Joanaz de Melo deconstructed five main arguments used by those who promote dam construction:

Argumento ridículo 1 – “O investimento é privado.” O investimento inicial nas nove grandes barragens aprovadas pelo Governo ascende a 3600 M€, o que, somado aos custos financeiros e ao lucro das empresas de electricidade, gerará um encargo global estimado em16.000 M€ ao longo de 75 anos – que obviamente será pago na totalidade pelos cidadãos-consumidores-contribuintes. Parte deste custo será reflectido na factura da electricidade, e parte nos impostos, para suportar o défice tarifário e a “garantia de potência” estabelecida na Portaria n.° 765/2010. O que importa é que, entre tarifa e impostos, as novas barragens implicarão um aumento superior a 10% no custo da electricidade. (…)

Ridiculous argument 1 – “The investment is private.” The initial investment in the nine big dams approved by the government exceeds €3.6 billion, that added to financing costs and the profits of the electricity companies, will create a total burden of €16 billion over 75 years – that obviously will be paid in totality by citizens-consumers-taxpayers. Part of this cost will be reflected in electricity bills, part in taxes to allow for the rate deficit and the “power guarantee” established in Decree no. 756/2010. What matter is that, between rates and taxes, the new dams will mean a 10% increase in the cost of electricity. (…)

Another one of the most active voices is that of José Luis Pinto de Sá, engineering professor at the Instituto Superior Técnico who has alerted the fact that the energy production “[of] the new hydroelectric investments, projected or in construction” will be “null or even negative”. In a post written in May 2010, for the blog A Ciência não é neutra (Science is not neutral), Pinto de Sá explained in a simple way the calculations of the (non) production of energy of these dams:

No total (…) as barragens produzirão em média 525+175= 700 MW, mas também consumirão 700 MW de origem eólica (ou solar). Portanto, o saldo energético das barragens será nulo.

In total (…) the dams will produce an average of 525+175=700 MW, but also will consume 700 MW of wind power (or solar). Thus, the sum  electrical output will be null.

The Tua case

The Tua line. Photo by nmourao on Flickr (CC BY-SA 2.0)

The Tua line. Photo by nmourao on Flickr (CC BY-SA 2.0)

Of the ten dams included in the National Dam Program, the most problematic is the Foz Tua Dam. The beginning of construction, in January 2010, implied the destruction of part of the Tua railway, a historic and centuries-old route.

The Movimento Cívico Pela Linha do Tua (Civic Movement for the Tua Line), that has existed since 2006, has been the main platform for opposition to this dam, organizing numerous protest actions and arguing that the repair of the railway would be better for the region than the dam.

According to a report in the program Biosfera, “Verdades Escondidas sobre as Barragens” (Hidden truths about the Dams), studies conducted by Portuguese universities showed that repair of the railway combined with environmental and cultural tourism would generate 11 times more employment than the dam for each €1 million invested.

Of all of the arguments against dam construction, the one that has had the most impact has been the preservation of Alto Douro Vinhateiro (Upper Winegrowing Douro), World Heritage of Mankind, since 2001.

In June 2012, resulting from the intervention of the Portuguese Ambassador at the last meeting of UNESCO in St Petersburg, members of the committee voted unanimously to significantly slow down the construction until the visit of a mission to occur before the end of July.

Image shared on the Facebook page "Eu não pedi um Plano Nacional de Barragens" (I did not ask for a National Dam Plan)

Image shared on the Facebook page “Eu não pedi um Plano Nacional de Barragens” (I did not ask for a National Dam Plan)

In an article published in the Público newspaper and reproduced on the blog Vi(st)a Estreita, precisely in July 2012, Alberto Aroso, the operational coordinator of the company responsible for the public services managing the national rail network (REFER), maintained that:

os estragos até agora produzidos ainda são reversíveis, na medida em que o paredão ainda não está iniciado e os cortes nas encostas para o respetivo encaixe ainda não têm expressão, estando-se perante o último fôlego do vale do Tua e o último momento para suspensão dos trabalhos para reavaliação de todo o projeto, procurando-se encontrar uma solução que salvaguarde o interesse nacional. A cada dia que passa mais caro será parar a barragem, nomeadamente se a mesma se traduzir no seu abandono definitivo.

The damage done is reversible, in that construction of the massive dam wall has not been started and the cuts on the slopes needed for it are not that visible yet. We are faced with the last chance of the Tua Valley and the last moment to suspend construction to re-evaluate the whole project, seeking a solution that defends the national interest. Each day that passes it will be more expensive to stop the dam, namely if this translates in a definitive abandonment [of the project].

However, after the visit of UNESCO officials, the construction was not suspended with the slow down only lasting until the conclusion of the report by UNESCO mission, that is supposed to be ready by the end of the year. In keeping with this decision, the Ministry of Agriculture, Sea, Environment and Land Management decided to put off the construction of the dam wall of the Foz Tua Dam until the second semester of 2013.

Rivers are being privatized

Alongside the whole dam question, the privatization of shares of Portuguese energy company (EDP) that the Portuguese state still possesses must be kept in mind. EDP is one of the main investors in the National Dam Program.

In December 2011 the sale of the Portuguese state's 21.35% share in EDP to the Chinese company Three Gorges for the sum of €2.7 billion was announced. This sale was the ninth largest transaction on the world energy markets in 2011.

Coincidentally or not, Three Gorges Company is responsible for the Three Gorges Dam, one of the largest in the world, which is situated on the Yangtzee River.

The state maintained a 4% slice of the electricity company, that cannot be sold because it is “prisoner” to interchangeable bonds. Meanwhile, the State is expected to sell the last 4% during 2012, no longer having any share of the company.

While in Portugal new dam construction is being discussed, in the US some of the largest dams are being demolished [en] as they are too expensive, inefficient and harmful to the environment.

The National Dam Program is far from being resolved and people need to know what is at stake.

This article is a part of our special coverage Europe in Crisis.

  • Ernst Schade

    The Tua Dam project is certainly the biggest Portuguese environmental blunder in this century. Of course, the construction companies like Mota Engil and the political elite are behind this and the UNESCO agrees. Distressing and depressing. And the ‘ordinary’ Portuguese will pay the bill: € 16 billion!

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