Panama Withdraws Problematic Barro Blanco Dam Project from CDM Registry

By Ariadni Chatziantoniou and Kelsey Alford-Jones

In early November 2016, Panama withdrew the Barro Blanco hydroelectric power plant project from the Clean Development Mechanism (CDM) – the first time a host country has withdrawn a CDM registration due to human rights concerns. Specifically, the project failed to respect the rights of the indigenous Ngäbe people. In addition to destroying livelihoods by the flooding the dam’s reservoir, Barro Blanco is forcibly relocating Ngäbe families who never consented to the project as required by international law.

The Barro Blanco project, run by Panamanian company GENISA and financed in large part by German and Dutch development banks, is located on the Tabasará River, near the Ngäbe-Bugle comarca, or indigenous territory. Though the project was envisioned as a way to contribute to sustainable development, the dam’s reservoir would flood indigenous land, homes, and cultural artifacts. Official estimates by GENISA vastly underestimated the number of people affected – NGO partners estimated that the dam project risks the livelihoods of nearly 5000 Ngäbe farmers and disrupts or displaces half a dozen townships. Moreover, the implementation of the project quickly violated international norms, including the right to consultation.

M 10 Ciudad de Panamá 3_Jonathan González, Alianza para la Conservación y el Desarrollo (ACD)
Demonstration outside Inter-American Commission Hearings in Panama City, Dec 2016. Credit: Jonathan González, Alianza para la Conservación y el Desarrollo (ACD)

Affected communities expressed concern from the outset. Faced with imminent forced evictions and test flooding that would destroy homes and farmlands, families repeatedly challenged the project before their public officials, the CDM, Panamanian courts, and representatives of the United Nations. CIEL, in coalition with other international NGOs, supported these calls, filing amicus briefs, sending letters to the UN, and calling on the President of Panama to suspend test flooding. The Panamanian government formally recognized in 2015 that the Barro Blanco project had been approved in violation of the Ngäbe’s social and cultural rights. As a result, Panama temporarily suspended the construction of the project and fined GENISA $775,000 for failing to adequately consult, relocate, and compensate those adversely affected by the dam. Project development continued, however, and in June 2016, after the most intrusive round of test flooding, CIEL and partners sent another urgent letter to the CDM, reiterating the call for the project to be withdrawn.

In October 2016 – nearly ten years since communities’ began their defense of life and land – the Panamanian Environmental Ministry finally sent a formal request to withdraw the project from the CDM registry by Nov. 1. While the project’s withdrawal may not lead to immediate changes for affected families, the move is symbolically significant. The dam’s designation as a CDM project lent it legitimacy, despite its history of problems and violations.

“The withdrawal of the Barro Blanco dam is further evidence that the proposed benefits of a project with low carbon emissions cannot supersede the responsibilities of the government or the private sector to address negative social impacts or the violation of community rights,” stated Antonio Chang Kruell, one of the Panamanian lawyers working on the case.

Barro Blanco is not unique; several CDM projects have had serious social, environmental, and human rights consequences. These large-scale renewable energy projects have been widely opposed by communities affected by their construction, and have been increasingly delegitimized as sustainable options. While such projects are seen as a way to progress toward the goals expressed in the Paris Agreement in reducing carbon emissions, they come with their own set of environmental and social harms – including adverse climate impacts. A September 2016 report found that artificial reservoirs created by large-scale dams may emit large amounts of methane gas, contributing significantly to greenhouse gas emissions. During the Paris climate talks in 2015, 300 organizations from 50 countries called on countries to exclude large-scale hydro projects in climate initiatives like the CDM.

M 10 Ciudad de Panamá 4 Jonathan González, Alianza para la Conservación y el Desarrollo (ACD)
Demonstration outside Inter-American Commission Hearings in Panama City, Dec 2016. Credit: Jonathan González, Alianza para la Conservación y el Desarrollo (ACD)

Moreover, the Barro Blanco project highlights the need for a human rights-based approach in sustainable development initiatives, an issue on which CIEL continues to advocate across the diverse array of development finance institutions, including the new Sustainable Development Mechanism of the United Nations Framework Convention on Climate Change (UNFCCC). Much work remains to be done to ensure human rights policies and procedures are adequately included.

The withdrawal of Barro Blanco’s CDM registration serves as an important reminder for governments, companies, and international banks that renewable energy projects need to meet the same social and environmental standards as any other project, including proper consultation with affected communities. It is a step in the right direction for climate action, and a clear example that further steps must be taken to ensure that the rights of local communities around the world are fully protected in climate action.

Originally posted Dec 12, 2016