On February 4, blackouts swept across some of Brazil’s most
populated areas, hitting nearly six million consumers and industrial users.
While the energy ministry said the power outages were the result of short
circuits in a transmission line, they came at a time of record drought and
heat, raising fears that more blackouts could be on Brazil’s horizon.
São Paulo
state, home to a fifth of Brazil’s population and a third of its
economic activity, has been particularly hard hit. The state’s capital
will host the World Cup in June. If the state enters the games without a
major precipitation event, the government’s backup water plan is to
pump 200 billion liters of water being held in reserves at a cost of $36
million.
The government’s back-up energy plan is much costlier. Brazil is around 70% dependent on hydropower for its electricity needs. This over-dependence on hydropower has repeatedly hurt Brazil’s economy during drought events. With its reservoirs at 38% of capacity, Brazil’s backup plan is to switch to dirtier, costlier and more dangerous options such as fossil fuels and nuclear. Meanwhile, the Financial Times reports that power supplies will drop by up to 6% if reservoir levels continue to fall, according to the national utility.
According to Reuters, the government is rescuing public utilities with a $4.81 billion loan from 10 banks to help distributors purchase energy. The loan would eventually be repaid through electricity rate hikes for consumers beginning in 2015. Another unexpected economic consequence is the loss of jobs in the aluminum sector. Alcoa has cut production at its smelters in Brazil because, under current economic conditions, it can make more money selling electricity from its thermal plants than it can from making aluminum, the Financial Times reports. According to Bidnessetc.com, “power produced at a facility similar to Alcoa’s would cost around $18 per megawatt per hour (MWh). The same energy can be sold on the spot for around $370 per MWh, while two and three-year power contracts sell at more than $110.”
Apart from the financial risks of hydro-dependency in a changing climate, other risks to the environment and society seem lost on the nation’s energy planners. Brazil is planning to build hundreds of large hydropower dams in the Amazon Basin. Highly destructive dams are being proposed and built, with major implications for indigenous people, river communities, human and ecological health, and biodiversity.
Flooding in the Amazon
While southern Brazil has been undergoing its worst drought in decades, the Madeira River – the Amazon’s largest tributary – overflowed its banks earlier this year. At least 22,000 families were evacuated in Bolivia and Brazil, and 60 people lost their lives to the floods. The region suffered millions of dollars in damage.
While the main driver of these immense floods was unprecedented rainfall, experts point out that other systemic environmental problems also played a role, including deforestation in the Andean highlands of Bolivia and Peru, overgrazing, and inadequate dam management at the Santo Antônio and Jirau dams in Brazil. Santo Antônio, for instance, could not contend with flows 25% higher than its maximum design flow, resulting in floods that spilled over from the reservoir into urban areas.
In the Amazon, 100-year flood and drought events have become increasingly common. In 2005 and 2010, two 100-year droughts hit the Manaus region in the state of Amazonas, followed by a 100-year flood in 2012. This tragedy led a federal judge to demand new environmental studies for the two dam projects, which must incorporate knowledge about the new historic flow levels on the river. If the studies are not done, each dam’s operational license could be revoked.
Asking the Right Questions
Given the scale of proposed dam building in the Amazon, the lack of attention to climate risks on proposed and existing projects is a dangerous trend. According to International Rivers’ Dams in Amazônia database, 414 dams are being planned, under construction, proposed, or in operation in the Amazon. More than a third of these dams are located near its Andean headwaters – an area that could see both increased short-term flooding and long-term water scarcity as Andean glaciers continue to melt due to climate change.
Currently, climate change variability is not factored into the environmental assessment process for dams in Brazil. For a country that is so heavily dependent on dam reservoirs for water storage and hydroelectricity, this is highly irresponsible.
Why are climate variability assessments for dams necessary? According to a Brazilian study that was conducted from 2008 to 2010, today’s pattern of higher rainfall in some areas and prolonged periods of drought in others will be the norm by 2040. This was confirmed by the latest IPCC fifth assessment report. Such fluctuations could spell not only economic disaster for hydropower operators, but also huge safety and security risks to river-dependent communities. Also at issue is that tropical dams are themselves significant contributors to climate change, as they can emit high quantities of methane gas from their reservoirs. Amazon dam projects are not being evaluated for their reservoir emissions.
Almir Narayamoga Surui, a representative of indigenous people in the region of the Santo Antônio and Jirau dams on the Madeira River, notes: “These dam projects bring immediate profits to some politicians and companies, and short-term employment for some workers, but what about their larger costs to people and nature? We need a new model of development that brings benefits to all, that respects indigenous peoples, their knowledge and their territories.”
If recent events are any indication, Brazil’s energy planning may be coming to a climate crossroads. In the short term, the nation could reduce the energy sector’s climate risks by improving the efficiency of its transmission line system, and speeding up development of alternative renewable resources. Brazil has a potential capacity of 300 GW in wind power, which is cheaper than natural gas on the Brazilian market. In terms of solar, Brazil has some of the highest “insolation” levels in the world, though it has been slow to adopt it. Greater water and energy efficiency measures on both the supply and demand side could help reduce the burden on energy suppliers.
Katy Yan