With trade links between Argentina and China now firmly established, President Cristina Fernández de Kirchner visited counterpart Xi Jinping last week and signed a raft of agreements. However, with the partnership’s flagship project subject to an environmental dispute that must now be resolved by the Supreme Court, the next steps are set to be anything but straightforward.
Named after Fernández de Kirchner’s late husband, former president Néstor Kirchner and the former governor of Santa Cruz province Jorge Cepernic, two new dams set to be constructed will be among Argentina’s most important energy projects, helping reduce the quantity of energy that is imported in an economy where dollars are scarce.
Yet at the same time, environmental experts and campaign groups claim the dams have the potential to affect three Patagonian glaciers at UNESCO World Heritage site Los Glaciares.
The project has a price tag of USD $4.7 billion, will run for five years and is fully financed by Chinese banks, with part of the energy generated used to repay the loan. The first tranche of USD $288 million has already been received, with the remainder to be provided in regular instalments. Part of the money will stay in China for investment in machinery, with the remainder destined for Argentina.
“It’s going to be a massive project with significant involvement from Argentine companies. Turbines, machinery and technical expertise will be provided by China; the rest will be up to Argentina. It will be a major source of employment and will increase consumption in the region by increasing the consumption of the workers,” explains Ernesto Fernández Taboada, executive director of the Argentine–Chinese Chamber of Commerce.
Even though the construction order for the project has already been signed by Fernández de Kirchner and Xi Jinping, the main work will not begin until October at the earliest, when the environmental impact study is due for completion, according to sources from the construction companies involved. But this doesn’t mean the project won’t get under way until then: partial permits have already been awarded and the construction of roads, bridges, workshops and houses will begin soon.
“We won’t start the project itself until approval of the environmental impact study, which we began last September and should be ready in October. We’re taking a whole year to study the behaviour of the river and the surrounding nature. However, partial approvals have already been granted for subsidiary works,” states Mariano Musso, Head of Institutional Relations at Electroingenería, one of the companies involved in the project.
But it seems the company’s guarantees are not enough for environmental experts and organisations, who have lodged an appeal with Argentina’s Supreme Court, demanding construction be fully halted until completion of the environmental impact study. The court has yet to rule on the case but is expected to do so in a matter of days.
“Under the National Constitution, work cannot start without the environmental impact study. We’re not saying the project should not go ahead, we’re asking for the correct studies to be carried out to legally determine whether it can proceed. Without this study, the two dams will be illegal,” warned Luján Pérez Terrone, Executive Director of the Patagonian Association of Environmentalist Lawyers.
A Project Dating Back 60 Years
The hydroelectric complex will be built in the Patagonian province of Santa Cruz and will see the first dams built on the River Santa Cruz. A consortium of three companies will be responsible for its construction: Electroingenería and Hidrocuyo (both Argentine), and Gezhouba Group (China), the latter with a long history of building dams, including China’s Three Gorges Dam, the largest in the world, but whose environmental impact has also made it one of the most controversial.
The project dates back to the 1950s and its feasibility was studied in the 1970s under Argentina’s military dictatorship, however it has remained on the drawing board until now. In 2007, it was relaunched by the Fernández de Kirchner government, with the names Condor Cliff and La Barrancosa proposed for the dams (subsequently renamed Néstor Kirchner and Jorge Cepernic) at a cost of 35% less than the current figure. However it stalled due to a lack of funding.
The dams will increase the country’s energy capacity by 5% and its hydroelectric capacity by 15%, creating 5,000 jobs as part of the construction. Around 150 Chinese engineers and managers will be based in Argentina, with the rest of the team comprising local workers, as guaranteed by the construction companies.
Around fifty ranches (47,000 hectares) will be flooded as part of the construction and the dams will house 11 turbines providing an annual generating capacity of 5,000 GWh and 1,740 MW of power. However, the project will also require the installation of a new high-voltage power transmission line since the existing infrastructure will only be able to carry 45% of the energy generated by the dams.
Experts have questioned the economic feasibility of this second line since as the dams operate based on energy peaks, it will only be used 4% of the time. However, Electroningenería is still confident the second line could be built at the same time as the dams and could also be used for future energy projects in Patagonia, such as wind farms.
Glaciers and Environmental Concerns
The insistence about the environmental impact study arises from concerns about the consequences of the project on the Upsala, Spegazzini and Perito Moreno glaciers in the UNESCO-protected Los Glaciares national park.
Experts claim the maximum level of the Kirchner dam, at the same average level of the Argentino Lake, is unsuitable, increasing the level of the lake and causing tides that will erode the front of the Perito Moreno glacier and stop the traditional blocks of ice breaking off, a phenomenon that attracts thousands of tourists.
The controversy is not without precedent. Across the border in Chile, also in Patagonia, the HidroAysén project would have resulted in the construction of five hydroelectric power plants, two on the River Baker and three on the River Pascua. However, fierce criticism from environmental groups and indigenous communities resulted in a council of ministers rejecting the project last year.
“The dam will be fed from the lake, whose level will rise and fall to meet Buenos Aires' energy requirements and consumption. The glacier will not be immune to variations and their erosive effects,” argues Gerardo Bartolomé, the engineer at the head of an online petition aiming to ensure the correct environmental studies are carried out for the dams.
Similarly, Juan Pablo Milana, a glaciologist and researcher at the National Scientific and Technical Research Council (CONICET), believes the dams will cause irreversible damage to the Spegazzini and Upsala glaciers.
“The glaciers are already subject to the forces of nature and introducing further changes is complicated. Increasing the level of the Argentino Lake will create a flotation effect. Lower water pressure at the base of the glacier will not only cause detachment of ice but will also change the way it breaks off,” explains Milana.
Electroingenería dismisses the potential impacts with the assurance that operation of the dams will be regulated and controlled by the basin authority. The Néstor Kirchner reservoir will also accompany variations in the lake, allowing more efficient regulation.
“The construction of the dams will have absolutely no effect on the lake and the glaciers. The project would not have been tendered if there was a real risk. Our company respects the environment and this is one of our priorities. The glacier has World Heritage status and no company would be willing to cause problems,” assures Musso.