Viewpoint - Fifty years of hydroelectric development in Chile: A history of unlearned lessons

Michael Nelson
Consultant, formerly World Bank and UN Economic Commission for Latin America, Wanaka, New Zealand; mikechile@gmail.com

ABSTRACT: The development of hydroelectricity in Chile illustrates a situation where water resources can be both well and badly managed when a private or public utility company, in this case ENDESA, is powerful enough to operate largely outside standard policy and bureaucratic processes. It successfully increased hydroelectric capacity more than fourfold over three decades characterised by periods of significant political instability. This was done without noticeable conflict due to its recognised efficiency and absence of environmental concerns in Chilean policy until the late 1980s. Since that time there has been increasing pressure from international agencies and NGOs to place more emphasis on environmental dimensions in development. The interplay among the diversity of agendas and tactics adopted by the interest groups attempting to influence decision on hydroelectric projects has, in some cases, been counterproductive. ENDESA chose to withhold information and modify EIA procedures as tactics to reduce costs. The NGOs'single-minded dedication to preclusion of dam proposals tended to distort public debate. The government, presumably due to risk aversion, proved unwilling to take a proactive stance by not specifying and implementing requirements for approval of a dam project, providing a comprehensive policy framework for debate or facilitating dialogue on the issues.

KEYWORDS: Chile, river basin development, hydroelectric dams, environment, vested interests