Dear friends of the Macal River Valley,

I know that war has distracted attention from many efforts to protect
the environment. I'm writing, however to update you on the movement to
save the Macal River Valley (see below). Please feel free to contact
me, or any of the other members of the international effort for more
info. or details.

On Monday, the Belize Appeals court ruled in the case against the
environmental approval of the dam. While the court did not overturn the
approval for the project, it did open the door to an appeal to the Privy
Council in England. BACONGO will file this appeal shortly. In addition
to this and other legal actions, Fortis is being questioned at home in
Newfoundland about dubious accounting practices.

We need to maintain a concerted effort in the next couple of
months--Fortis faces the rainy season in June, and has said in court
that if it doesn't build this year, the project will likely never be
built.

--Ari

Ari Hershowitz
Director, BioGems Project, Latin America
Natural Resources Defense Council
(202) 289-2388
1. Belize groups to take case to Privy Council in England: Belize
Appeals Court Fails to Overturn Dam Approval
2. Fortis/BECOL operating without a licence: application to utilities
commission challenged as illegal
3. Consumers question $15 million taken by Fortis in Newfoundland
4. Fortis plans to hire Three Gorges Dam builder for Chalillo

1. Belize groups to take case to Privy Council in England: Belize
Appeals Court Fails to Overturn Dam Approval

On Monday, March 31, Belize's Appeals court upheld the Supreme Court's
decision not to overturn the government's environmental approval of
plans to dam the Macal river in the country's rainforest. The Appeals
court judges said that they disagreed with many of the findings of the
Supreme Court, but decided not to overturn the decision. BACONGO, the
organization of conservation groups which brought the lawsuit, will
appeal the case, and file for an injunction to stop dam construction.
If built, the dam would flood the Upper Macal River Valley and destroy
key habitat for rare and endangered wildlife, including the jaguar, the
tapir (Belize's national animal), and a subspecies of scarlet macaw
numbering fewer than 200 in Belize.

In his December decision, Chief Justice Abduleh Conteh had ordered the
government to hold a public hearing, but did not invalidate the
government's decision to grant environmental approval for the project.
In its ruling Monday, the Appeals court said that it disagreed with many
of the findings of the Chief Justice, but would also not overturn the
government's environmental approval. However, the court also found that
this case clearly involves an issue of major public interest, and
indicated that it would give permission for the case to be heard before
the Privy Council.

Following five days of arguments, involving thousands of pages of
evidence, the Appeals court justices returned their judgement after a
recess of just 12 minutes. Lois Young, a senior attorney representing
the Belize Alliance of Conservation NGOs (BACONGO), pointed out the
gross inadequacies of the environmental review of the dam, including
inaccurate information about the geology of the dam site, major gaps in
information about the ancient Maya sites that would be flooded, and a
lack of wildlife studies. Ms. Young showed that the environmental
assessment itself, and the government technical committee underscored
all of the deficiencies in the assessment, and yet voted to approve the
project. Co-counsel Dean Barrow argued that it was unreasonable for the
government to hold a public hearing after it had already approved the
project, and asked the court to overturn the decision and order a fair
public hearing. The Department of Environment was represented by
Solicitor General E. Kaseke, and BECOL, a subsidiary of Fortis, Inc. of
Canada, was represented by Michael Young (no relation to Lois Young).
The court has not given its reasons for the decision, and will present
these when it returns to Belize in June.

The company's legal troubles are far from over, however. In addition to
the environmental case now on its way to the Privy Council, groups in
Belize point out that the company is operating an existing
hydroelectricity dam without a licence, despite the legal requirement
for all electricity generators to have one. They maintain that it would
be illegal to build the dam without going through the licensing process.
The Belizean groups will likely seek an injunction to bar BECOL, the
subsidiary of the billion-dollar Canadian power company Fortis, and
proponent of the dam project, from moving ahead with the project.

The struggle over this project landed in Belize's courts more than a
year ago. Fortis had announced that it would start construction on the
dam at the start of Belize's dry season in January 2002, but was blocked
from doing so when Belizean groups sued over the government's failure to
hold a hearing and gather important information on the dam's impacts.
This year, again, Fortis planned to start building in January, but held
off when Belize's Supreme Court ordered the government to hold public
hearings on the project.

BACONGO's appeal to the Privy Council will be filed in the next couple
of weeks. It is not unusual for the Privy Council to overrule a
decision of the Appeals court on a matter of public interest. "What is
at stake in this case is no less than the public's right to a fair
hearing, and we are confident that we will be vindicated," according to
Matola.

2. Fortis/BECOL operating without a licence: application to utilities
commission challenged as illegal

BACONGO has written to the Public Utility Commission of Belize to
challenge the illegal status of Fortis' Belizian subsidiary, BECOL,
which has been operating the existing Mollejan dam on the Macal y
without a licence. All electric generators in Belize above 75 kilowatt
capacity (BECOL's dam is about 3000 times bigger).
BACONGO also pointed out that the PUC cannot even consider the current
application of Fortis/BECOL for permission to build Chalillo dam until
it first grants a license to BECOL. Under Belizean law, the PUC must
fully consider economic, environmental, and social factors and should
provide an opportunity for a public hearing.

3. Newfoundland Public Utility Board hearings to address Chalillo dam

Greg Malone, a satirist and Newfoundland advocate who has worked with
groups to oppose the Chalillo dam, will testify before Newfoundland's
Public Utilities Board about the inequities of Fortis' dealings in
Belize, and the risks associated with its proposed dam project. Credit
rating agencies have warned that risks taken by Fortis could lower its
credit ratings in the next few months. This would also affect Fortis'
subsidiaries in Canada and end up raising their electricity bills.

Newfoundland's consumer advocate has questioned Fortis' practices at
home in a month-long inquiry before the Public Utilities Board. Fortis
is applying for a rate increase, which is being vigorously opposed by
the consumer advocate, and by many customers in Newfoundland. During
the hearings, it came to light that Newfoundland Power, a Fortis
company, had requested (and received) millions of dollars for "expenses"
than the company was entitled to. Even though the later expenses turned
out to be $15 million lower than Newfoundland Power had projected, the
company ended up keeping the difference.

4. Fortis plans to hire Three Gorges Dam builder for Chalillo

We have recently learned-from a statement by BECOL CEO to Belizean
television-that Fortis is contracting with C.W.H.E.C, a Chinese company,
to build the dam. C.W.H.E.C. is the national hydropower construction
company in China, responsible for construction of the controversial dam
in China. The company has also been involved in charges of gaining
contracts through corruption in Bangladesh, on a project that ended up
costing millions more because the engineering was not done right for the
geological conditions of the dam site.

Fortis had resisted for months making public the identity of the
potential contractor for this project.

Hey Ari,

You neglect to mention that a third dam at Rubber Camp will have to be constructed to make Chalillo operational. Chalillo has to be built to make Mollejon operational.

The three dams are interdependant upon one another and one won't work without the other two. Those costs have to be factored into the total viability of the project. Along with the engineering obstacles regarding the foundation at Chalillo and possibly at Rubber Camp.

Then ask, will this work and is the cost and destruction of habitat worth the benefits we'll derive from it.

Having just returned from Belize and talking to locals in San Ignacio, they are totally against the dam and feel it will ruin the ecological habitat of the river.

Although there are petitions throughout San Ignacio and it was one of the issues during the recent elections they feel that this will be built regardless so anything that can be done to prevent the building of the dam should be done.

Sorry but most people i talked with in the cayo area are for the dam,the main reason is to help with floods.The company you all talk about will not make a dime on this dam,it is a good will thing not a money thing!Will it be good or bad?Only time will tell.

There is a fairly long and farly well-balanced article in this month's Outside Magazine about the project[Kelly Slater on the Cover]. Quotes the Zoo lady and the guy from Chaa Creek [Fleming?] and also proponents of the dam. Frankly, IMAHO it does not sound like either side has a completely compelling arguement. Therefore the dam should be unbuilt. Most threatened species is the Scarlet Macaw.

I tend to agree with you Frank. When in doubt don't do anything!
Why take a chance at ruining anything that took so long to develop.
Richard

I am against the dam. BUT, there is a legitimate need for more, reliable, cheap electricity at this time in Belize. This need is not going to go away. What to do? And I DO want to read that article in Outside Magazine.

With the easterly winds coming off the caribbean sea every caye could have several wind mills producing energy for the inhabitants. The interior has strong bright sunrays hitting against the solar panels. With some technology coming through a international developing agency, could solve some of the energy problems. Maybe it's just a pipe-dream, or can it happen ? Mel

It could be undone (many locals feel it's a done deal) or not done if there was a coalition made up of politicans as well as environmalists and locals ( who in general don't want the damn) - but, unfortunately, you need the politicians and beurocrats with you to succeed

I urge anyone interested in this topic to read the current OUTSIDE MAGAZINE article (May) on the Dam: "Last Flight Out" by Bruce Barcott. Complete with photos and maps. Looks good...haven't had time to read it yet. Check it out!