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Date: Fri, 16 May 97 19:25:25 CDT
From: rich@pencil (Rich Winkel)
Subject: El Salvador: Proceso: The Pro-life demagogues

/** reg.elsalvador: 35.0 **/
** Topic: Proceso 755: 30 April 97 ** ** Written 7:33 AM May 11, 1997 by in cdp:reg.elsalvador **
From: CIDAI/UCA El Salvador <>

Center for Information, Documentation and Research Support (CIDAI) Central American University (UCA)
San Salvador, El Salvador
Apdo. Postal (01)575, San Salvador, El Salvador
Tel: +503-273-4400 ext. 266 Fax: +503-273-5000

Social and ecological impact of dam-building in El Salvador

Processo, No.755, 30 April 1997

Soon after the announcement that electric power distributors would be privatized, the public became aware of certain details of the law governing the sale of shares in these companies which revealed the true intentions of this program, particularly with regard to the concentrated way the benefits would be distributed.

According to Article 12 of that law, "the resources generated by the sale of shares of the distributor companies must be utilized by CEL [the national power company] exclusively for the development of infrastructure to generate electrical energy by natural means." According to CEL President Guillermo Sol Bang, the intent is to expand the capacities of the Cerron Grande and 5 de Noviembre dams, and to build five more hydroelectric dams along the Lempa River.

This provision certainly calls into question the alleged investment in projects which carry social benefit, which was the argument used to justify the privatization of state-owned enterprises. We have seen this in the past, since the privatizations carried out to date have not translated into noticeable increases in social spending. However, it is important to highlight some of the effects of dam-building in El Salvador, and the possible implications of a plan to expand hydroelectric energy along the lines proposed by CEL.

Historically, it can be demonstrated that those who reap the least benefits from dam-building and electricity generation have been the nation's majority population. Thus, it is worth mentioning that the reservoirs created by dams have meant a loss of natural resources and infrastructure, as well as the displacement of people and destruction of habitat; all that without any benefit in rural areas in terms of increased electricity use.

The most controversial case has been the construction of the Cerron Grande dam, which was at first designed with the clear intent of generating electricity, but it was also alleged to be beneficial in terms of preventing flooding along the lower basin of the Lempa River. Since experts estimated that the construction of the dam would create a reservoir covering over 140 km2, enough to be considered as the largest inland body of water in El Salvador, the project was surrounded by controversy from the very start. Evidently, the inhabitants of the area that was scheduled to be flooded were opposed to the project from the very start, forcing its postponement and then at least the resettlement of those who would be displaced, which still produced a negative effect.

The construction of the dam produced a loss of productive land, roads, bridges, a sugar refinery and archeological remains, as well as the displacement of 25,000 people. The most questionable effect was probably the fact that today, instead of preventing flooding, the dam has become a catalyst of floods because its floodgates are often opened to unload excess water; this also occurs in the other three hydroelectric dams in El Salvador. The problem of flooding is a serious one for rural populations who settle along both banks of the lower Lempa. Ironically, all this water liberated during the rainy season means that during times of drought, the dam reservoirs are too low, and drastic power rationing is implemented, like in 1987 and 1991, for example.

The principal beneficiaries of dam-building have no doubt been the urban-industrial sectors, since for the urban-artisan sectors it has been quite the contrary. The expansion of electricity generation in the early 1950's opened the way for the emergence of large factories making shoes, textiles, instant coffee, candles and other products which undercut artisan production. Studies on the utilization of electric power revealed that the kilowatt-hours consumed in the manufacture of these products shot up during that period, and gradually provoked a drastic reduction in artisan production.

A historical balance-sheet on dam-building comes out negative not only due to the effects mentioned above, but also because the management of the surrounding lands has produced prematurely heavy silting inside the reservoirs, thereby reducing their useful life- span. In other words, the huge investment in these projects has benefitted only minority sectors, at the expense of rural and urban-artisan sectors, and has noticeably increased foreign debt levels, since the dams were fundamentally built with World Bank loans.

Today, no new debts are being considered for dam-building, but the effects of past experiences ought to at least stimulate a review of current projects in order to avoid committing the same mistakes. Obviously, such a review would lead to the adoption of an institutional and legal framework which promotes the protection of the environment, but could also include certain goals related to improvements in the socio-economic conditions of the agricultural sector.

If we presume that dam-building is inevitable, we could at least take the trouble to point out four different courses of action: promote the sustainable use of lands surrounding the dams, expand electricity services in the rural sector, build small irrigation projects, and enact effective flood-control measures along the lower Lempa. As we pointed out above, the erosion of lands surrounding the dams has speeded up the silting process; this means there must be preventive plans promoted by CEL itself. Furthermore, expanding electricity services in the rural sector assumes that living standards will rise, and it will open up new opportunities to modernize many agricultural processes, thereby increasing their productivity.

The design of new dams could include offshoot irrigation systems aimed at supplying nearby farmers; in the case of El Salvador, that would even benefit existing government plans to expand irrigation systems. However, one of the most serious problems which must be resolved by dam-building include the recurrent flooding in the lower basin; if this could not be resolved in the past, now is the best time to include it as one of the goals of expanding hydroelectric infrastructure along the Lempa.

It is worth mentioning here that in some countries, dam-building has been conceived of as a starting point for promoting true processes of recovering the environment, the sustainable management of natural resources and improvements in local farmers' socio-economic conditions. In order to achieve this, dam-building has gone hand in hand with campaigns to improve agricultural techniques, distribution of fertilizers, health campaigns and the massive expansion of rural electricity.

CEL's proposal to build five new hydroelectric dams should lead to reflection on the implications of investing the benefits of privatization into narrow sectors (the new owners of the power distribution companies, industrialists and certain urban residential areas), while the greatest costs of building dams and reservoirs will be borne by the rural sectors who are traditionally excluded from the benefits of expanding the electrical grid.

Centro de Informacion, Documentacion y Apoyo a la Investigacion de la Universidad Centroamericana "Jose Simeon Can~as" (CIDAI-UCA)
Apdo. Postal 01-575
San Salvador, El Salvador
Tel: +503-273-4400
Fax: +503-273-5000