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Operation license for Amazon’s Belo Monte mega-dam suspended

  • A Brazilian judge has suspended the operating license of the controversial Belo Monte dam in the Amazon because the Norte Energia consortium, the dam’s builder and operator, failed to meet a key compensation commitment required by the federal government.
  • In exchange for the right to build and run the dam, Norte Energia originally agreed to install drinking water and sewage systems for the city of Altamira, with completion due in July 2014. The court allowed an extension to September 1, 2016, but the system is still not complete.
  • Norte Energia had argued that its commitment only extended to constructing water and sewer lines, not to connecting those lines to residences — a contention which the court has rejected.
  • The city currently dumps its sewage directly into the Xingu River, and waste is now building up behind the new dam. If the sanitation system isn’t quickly installed, officials worry that Altamira runs the risk of a collapse in sanitation due to the contamination of the city’s groundwater from domestic sewage.
Street scene in downtown Altamira. The sprawling city of 150,000 people is currently without operational drinking water or sewage systems due to an unmet binding commitment by Norte Energia, the builder and operator of the Belo Monte dam. Photo by Zoe Sullivan

A Brazilian judge has ruled that the Norte Energia consortium — builder and operator of the Belo Monte dam — hasn´t satisfied one of the central terms of its licensing agreement. The company was required under a 2010 federal agreement to build a sanitation system for the city of Altamira to compensate its roughly 150,000 residents for the dam’s impacts.

As a result, the judge has suspended Belo Monte’s operating license, pending completion of the sanitation system.

The company’s argument that it was only required to build the water and sewage lines, and that it was the city’s responsibility to connect those lines to residences, has been repeatedly rejected by judge Maria Carolina Valente do Carmo.

Sewage flows into an Altamira street. Norte Energia, the builder of the Belo Monte dam, has installed a municipal sewage system but has refused to link houses to it, insisting that this is the responsibility of the city government. Photo by Natalia Guerrero

The Belo Monte dam — the fourth largest hydroelectric project in the world — has been hotly contested by environmental and indigenous rights activists. It is located in the heart of the Amazon on the Xingu River, in the state of Pará, and began operation in spring of this year.

Higor Pessoa, an attorney with the Federal Public Ministry office in Altamira told Mongabay that the city currently directly empties its waste directly into the Xingu River. The waste, he explained, is now building up behind the new dam, making the timely hookup of the sanitation system by Norte Energia even more urgent.

“Altamira is running the real risk today of a collapse in sanitation due to the contamination of the city’s groundwater from domestic sewage and organic refuse that can also come from sewage.” said Pessoa. “There is real potential for this to mix in with the water that the population consumes.”

Reuters reports that while the dam is increasing production, and should have a maximum generating capacity of 11,233 megawatts, its average capacity is now hovering at around 4,571 megawatts to allay concerns about flooding protected indigenous lands. Norte Energia did not return requests for comment about its operating capacity.

Nearly 50 percent of the Norte Energia consortium is owned by public utility Centrais Eletricas Brasileiras SA, or Eletrobras, and two of its subsidiaries. Other shareholders include Petroleo Brasileiro SA (Petrobras) — which is embroiled in the massive Lavo Jato corruption scandal — along with the state-owned bank, Caixa Economica Federal.

The Public Ministry´s press release stated that the sanitation term attached to the licensing agreement is considered “one of Belo Monte’s most important” legally binding compensation conditions. The preliminary license issued in 2010 required that Norte Energia deliver the Altamira drinking water and sewage system by July 2014. When the operating license was issued at the end of 2015, IBAMA granted Norte Energia an extension until September 1, 2016 to finish the work.

Norte Energia did not respond to Mongabay’s requests for comment for this story. The Federal Public Ministry in Belém said that IBAMA received notice of the judicial decision on September 8, 2016.

The recently completed Belo Monte dam in the Amazon. Photo by Zoe Sullivan