2. Bart de Swart
INDIGENOUS
POWER
Renewable electricity and local
sustainability in Mexico and South America
Master thesis for the degree of
MSc. Globalisation and Latin American Development
Institute for the Study of the Americas (ISA),
School of Advanced Study, University of London
Supervision by Graham Woodgate
Date of submission 28 August 2012
3. Table of Contents
Preface and acknowledgements
1. Questions, aims and methods.........................................................................................1
2
. Theoretical framework.....................................................................................................5
3
. Current trends for power generation in Latin America and Mexico................................13
4
. Opposing wind in the Isthmus of Tehuantepec: A tilting at windmills?...........................2
6
5. Towards the first community-owned wind farm of Latin America ..................................4
2
6. Conclusions...................................................................................................................50
Bibliography
Appendix: Land-lease contracts analysed for Table 4
.1
4. 1
CHAPTER 1
Questions, aims
and methods
1.1. INTRODUCTION
An increasing amount of empirical evidence suggests that our planet is heating up in a
pace that is likely to have dire consequences around the globe, including sea level rise,
floods, desertification, extreme weather events, and, perhaps most significantly, drought
(Lovelock 2009). According to a study by the World Bank (2010), the region of Latin
America and the Caribbean (LAC) is likely to be severely hit by climate change, with
severe consequences for people and environment, the most important of which are
summarised in Table 1.1.
Table 1.1. Expected impacts of climate change in Latin America and the Caribbean
Area Description of impact Observed or expected consequence
Andes Disappearance of tropical
glaciers
Water stress for people and hydroelectric dams
Caribbean Bleaching and decreasing
of coral reefs
Decreases in marine biodiversity and tourism;
decreased protection against tropical storms
Gulf of
Mexico
Damage to wetlands Augmented vulnerability in the Gulf coast to hurricanes,
which will increase in intensity and frequency
Amazon Large rain forest areas
turning into savannah
Further changes in regional and global climate
Source: Author's elaboration based on a summary provided by World Bank (2010: 6)
5. 2
In 1988, the Intergovernmental Panel on Climate Change (IPCC) was founded after
scientists had discovered a link between human-induced carbon dioxide (CO2) emissions
and climate change. Reports of the IPCC have repeatedly suggested that human induced
emission of CO2 and other greenhouse gases (GHG) should be drastically scaled back in
order to mitigate climate change (cf IPCC 2007). One way to do this is to scale back the
use of fossil fuels for energy production and other economic activities. An additional
motivation for bringing down fossil fuel consumption is that reserves of oil, coal and gas
are finite, and diminishing1
.
It is increasingly becoming clear that tackling this dual problem of climate change and
declining energy resources requires a global strategy of curbing carbon emissions through
a reduction in fossil fuel consumption. However, the widely documented correlation
between energy use and economic activity (cf Arbex & Perobelli 2010; Apergis et al. 2010)
suggests that compromising on economic growth could throw back millions into a situation
of poverty, especially in recently emerging economies in Africa, Latin America and South-
East Asia (Collier 2010). Moreover, governments and business emphasise that tempering
economic growth would cause political and financial instability.
It should be viewed in this context that discourses on sustainable development and
'clean' energy have come to dominate the global discussion on development and climate
change. Increasingly, these discourses are contributing to a widespread belief that through
technology and innovation it might be possible to cut carbon emissions while at the same
time alleviating poverty and sustaining economic growth. It is not my aim here to contribute
to the technical and economical debates on to what extent this idea is based on realistic
expectations. Rather, the aim of this dissertation is to show how discourses on sustainable
development and 'clean technology' have facilitated the promotion of development projects
1 While the exact time frame in which all reserves will be finished is subject to debate, this is expected to
occur before the end of this century for oil and gas, and in the following century for coal (Shafiee & Topal
2009; Lior 2008; IEA 2006).
6. 3
that have not always been sustainable, especially related to local social and environmental
impacts.
The structure of the dissertation is as follows. First, mainly within the context of Latin
America, a modest but generalisable theory will be suggested in Chapter 2. The technical
and regulatory conditions for power generation from renewable energy (RE) sources in
general, and wind energy sources in particular, will be mapped out for Latin America and
Mexico in Chapter 3. Subsequently, Chapter 4 will assess the social impacts of
contemporary wind project in the Isthmus of Tehuantepec, and will try to identify factors
that have contributed (and are still contributing) to the current conflict situation between
companies and communities. Complementing the excellent work carried out by Hoffmann
(2012), Chapter 5 will explore to what extent a community owned wind farm (COWF) in
Mexico is likely to avoid the irregularities commonly associated with other wind projects in
the region. In Chapter 6, finally, the answers to my research questions (Table 1.1) will be
presented to arrive at some tentative conclusions.
Table 1.1 Research questions and corresponding chapters
N˚ Research question Chapter(s)
1 How should local socio-environmental externalities and conflicts resulting from
RE projects in Latin America be contextualised, and what denominating factors
can be identified that may lead to a generalisable theory?
2
2 How is the use of RE for electric power generation in Mexico and Latin America
to be contextualised, and what factors contributed to the recent growth of wind
energy projects in Mexico?
3
3 In what ways have wind energy projects been affecting local communities and
their environment in the Isthmus of Tehuantepec?
4 and 5
4 To what extent can the community-owned wind farm in Ixtepec be expected to
avoid the mistakes of its privately-owned counterparts?
5
7. 4
1.2. METHODOLOGY
The research for this dissertation has been carried out in two stages. The first stage
consisted of an intense, but obviously limited, retraining in the field of energy science2
. In
the second stage, fieldwork was carried out in Mexico for a relatively short period (five
weeks). In this limited time frame, depth interviews were carried out with stakeholders in
and around Juchitán de Zaragoza and Ixtepec, and with representatives from the Yansa
Group in New York and London (see bibliography). Moreover, participant observation was
carried out in Ixtepec on several occasions by accompanying one of the members of the
indigenous governing body and his assistant in their daily activities. At the time of this
research, their main activity consisted of consultations with posesionarios (usufruct rights
holders), of the lands currently being considered for the COWF. Observation of this
process served to assess the extent to which the autonomy and rights to 'prior and
informed consent' of the posesionarios was respected. Finally, primary sources such as
land lease contracts, constitutional laws, and crude numbers on electricity generation, as
well as secondary sources have been consulted and analysed.
2 A six months working placement at the department of Science, Technology and Society at Utrecht
University facilitated access to a great part of the consulted literature, most of which has been omitted from
the bibliography since it has not directly been used for the dissertation
8. 5
CHAPTER 2
Theoretical framework
2.1. INTRODUCTION
The need to curb carbon emissions discussed in the previous chapter has had such
influential institutions as the World Bank applaud initiatives by countries such as Brazil–
among the fastest growing economies of the current decade and as such expected to
significantly increase energy consumptions patterns– to increase their electric capacity
through the construction of hydroelectric dams. For instance, a joint report of the Office of
the Chief Economist and the Sustainable Development Department of the Bank’s Latin
America and the Caribbean division made the following recommendation concerning the
LAC region:
“Continuing high-income growth–and the consequent growth in demand for electricity–will
require that LAC continue to rely on clean energy sources for a relatively large fraction of its
generation capacity. The most obvious way to do this is to develop more hydropower
generation, in which the Region has huge untapped potential.”
(De La Torre, Faijnzybler and Nash 2009: 57)
Hydroelectric dams are often promoted as a ‘sustainable’ source of energy because
virtually no waste is produced once a dam is operational, and CO2 emissions during the
dam's life cycle are low compared to most other sources of electricity. Moreover, since
9. 6
hydroelectric dams generate electricity from a RE source, they potentially contribute to a
secure supply of electricity. Finally, some technical advantages of hydroelectric dams
include their storage capacity and “quick response to sudden changes in demand”
(Tweidell & Weir 2006; Andrews & Jelly 2007; Batlle et al. 2010). However, it is
increasingly becoming clear that hydroelectric dams are not as ‘sustainable’ as is often
argued. As will be discussed in the following section, the building of large dams in Latin
America has often led to social displacement and loss of biodiversity and related economic
activities. This in turn means a loss in social, economic, cultural and biological diversity
arguably still not sufficiently valued in sustainability discourses. More importantly, it
completely goes against the main principle of sustainable development3
.
2.2. BELO MONTE
Rarely had the friction between global discourses on sustainable development and the
unsustainable impact these discourses can have locally become so eminent as during the
2012 edition of the UN Earth Summit held in Rio de Janeiro. It was perhaps not so much
the conference itself that displayed this contrast, but the events that were occurring
simultaneously in relation to the building of a gigantic hydroelectric dam on the Xingu river
basin of the Brazilian Amazon. In what recalled images of James Cameron's epic movie
Avatar (2009), hundreds of indigenous people occupied the dam site, while in Rio mass
protests were held outside the conference.
The seriousness of the protesters' cause can hardly be overstated. Before completion,
set for 2015, the Belo Monte dam project will divert over eighty per cent of the Xingu river’s
natural flow, predicted to displace up to 40.000 people and to cause “substantial losses of
aquatic and terrestrial fauna” (Diamond & Poirier 2010: 26). Apart from local effects on
livelihoods, cultural diversity, and biodiversity, the project is expected to contribute to global
3 A much cited description by Brundlandt (1987: 54) holds that sustainable development “meets the needs of
the present without compromising the ability of future generations to meet their own needs”
10. 7
climate change by clearing forest and emitting greenhouse gases, particularly methane
and CO2
4
. Although currently less than eight per cent of the hydroelectric potential in the
Brazil’s Legal Amazon area has been developed (Caetano de Souza 2008: Table 1), at
least seventy more plants are planned (Verweij et al 2009).
The socio-environmental externalities that will likely result from the building of the dam
stand in sharp contrast to the expected benefits, at least locally. It could be argued that the
expansion of electric capacity might have positive effects on the population as well,
because local people may gain access to electricity, and, more generally, the addition of 11
GW to the grid might in theory have the effect of lowering consumer prices somewhat5
.
However, as Fearnside (2006: 8) points out, most of the generated electricity will be used
for aluminium and alumina processing plants, largely owned by multinationals companies
(MNC)6
that, partly as a result of the highly energy intensive nature of the aluminium
industry “employ a minuscule workforce in Brazil”.
Unfortunately, externalities caused by dam projects are not confined to a specific place,
such as the Brazilian Amazon. For instance, as Lokey (2009) points out, the building of the
Chicoy dam in Guatemala, the Bayeno dam in Panama and the Río Cajon dam in
Honduras have caused similar, sometimes violent conflict, and these cases are not
isolated. Indeed, the surroundings of major river basins such as the Amazon river in
countries like Bolivia, Brazil, Colombia, Ecuador, Peru and Venezuela, the Bíobío river in
Chile, and the Usumacinta river in Mexico and Guatemala, are home to hundreds of
indigenous communities, whose livelihoods have been or are being threatened by
(planned) hydroelectric dams. Thus, while specific environmental, social and political
4 It is important to note here that the emission of 1 tonne methane contributes as much to global warming as
25 tonnes carbon dioxide (Demarty & Bastien 2011)
5 This might especially be relevant to the poorest section of society, for whom energy costs typically
represent a large share of total expenses
6 In addition to the abundance of raw material (mainly bauxite) in the Amazon, many of these aluminium
refining MNCs were attracted to Brazil by the high electricity subsidies granted to companies. For example,
Turton (2002: 40) states that the Alumar Aluminum Smelter plant owned by the US based MNC Alcoa Inc,
received its electricity for reduced prices that were “so low in 1997 that the State-owned utility Eletronorte
subsidised Alumar to the tune of US$200 million”
11. 8
conditions of each case may differ, the displacement of local (indigenous) communities
and the negative impacts on their livelihoods caused by these dams appear to be a
recurrent phenomenon, at least in Latin America.
2.3. NCRE: A TECHNOLOGICAL FIX?
Many opponents of large hydro point to alternative sources of RE that could be harnessed
instead of large hydro, especially so-called non-conventional energy sources (NCRE) such
as wind and solar energy7
. However, the problems caused by 'clean' energy development
described above do not seem to be restricted to a specific technology8
. While for solar and
wind energy, no rivers need to be diverted, large-scale deployment of these technologies
may cause other or similar potential socio-environmental problems (Chapter 4). Despite
the fact that widespread large-scale deployment of these technologies is still only starting
to emerge in many countries, some NCRE projects have already caused conflicts in
various parts of the world. For instance, wind development has caused conflicts with local
communities in Chile, Mexico, Scotland, Spain, United States, and other places (cf
Pasqualetti 2011). Similarly, large scale solar power development, while still in its infancy,
has already created externalities and conflicts with local indigenous peoples, as currently
witnessed in the Californian Mojave Desert (cf Hunold & Leitner 2011; Helmore 2012). As
these technologies are becoming increasingly cost-effective, and are expected to become
cost-competitive with cheap sources of electricity in the course of the decade, the number
of conflicts in these sectors is likely to increase in coming years. So while opponents of
large hydro projects in culturally and environmentally sensitive areas are right to point to
7 There is a technical discussion beyond the aim ans scope of this dissertation on whether NCRE would
indeed be capable of substituting for the planned hydroelectric capacity in some countries. Beyond this
discussion, however, it should be acknowledged that the use of both wind and solar power for utility scale
power generation is becoming increasingly common, not least because the improved cost-efficiency of
NCRE projects as a result of learning (Junginger, Van Sark & Faaij 2010), economies of scale, and
innovation.
8 Or, for that matter, 'dirty' energy development, as suggested by, for instance, experiences with oil and gas
projects in the Amazon (Finer et al. 2008)
12. 9
the availability of alternative RE sources, the implicit assumption that a change in power
generation technology will solve the problem may at least be questioned9
.
2.4. TOWARDS A GENERALISABLE THEORY
As discussed above, the general occurrence of local socio-environmental externalities
related to 'clean' energy development projects is not confined by place or type of
technology, although both may cause significant variations in the nature and intensity of
these externalities. What, then, might be identified as a common denominator of these
projects? While context specific factors undoubtedly play a role in many cases10
, I would
argue that the following characteristics are crucial in the majority of cases: (1) local
communities are not informed, consulted, and engaged sufficiently prior to a project; (2)
local communities do not benefit directly from the energy produced or generated by the
project; and (3) in general environmental impact assessment carried out by companies
focus mainly on the 'clean' (low GHG emission) aspects of these projects, while
underestimating local impacts.
In essence, I argue, this is a consequence of the fact that in general, the main purpose
of this type of large scale RE projects is not that of creating positive (and avoiding
negative) local impact11
. To be sure, these may be secondary goals; however, these will
always be subordinated to whatever the primary goal is, especially since the costs of these
projects are typically in the multi-billion dollar range, of which the majority has to be paid
up-front. Thus, because of the enormous amounts of money and financial risk that are
9 That said, these and similar statements should not be misread as an indirect celebration of nuclear power.
The social and economic consequences of nuclear accidents as that of Chernobyl (1989) and Fukushima
(2011) and other problems such as the underestimated and increasing GHG emissions of uranium mining
(Mudd & Diesendorf 2010), among other things, suggest that nuclear power is all but free from socio-
environmental externalities. See Simonian (1995) for socio-environmental impacts of the only active nuclear
power plant in Mexico
10 For instance, case-specific factors in problems associated with wind energy in the Isthmus of
Tehuantepec may include, but not be limited to, caciquismo (Oceransky 2008) and the importance of this
region Isthmus as a major corridor for bird migration (see Chapter 4)
11 In contrast to, for instance, small scale RE projects aimed at reducing energy poverty
13. 10
involved, the principal goal of the companies and organisations behind the project is in
most cases to make the project succeed at the lowest costs possible, to maximise
revenues, and to minimise – and possibly externalise (Baker 2010)– financial risk.
This fact is exacerbated by an extremely narrow conceptualisation of costs and benefits.
The recent shift from ‘development’ to ‘sustainable development’ discourses that could be
noted in such influential institutions as the World Bank brought with it a promise of steering
the dominant discourse(s) towards more pluralist and inclusive views, and of stimulating
discussion about the end goals of development in relation to their means12
.
In essence, it seems that an almost autistic13
focus on (fast) economic growth and
profit-maximisation has not been replaced, but complemented by other goals, mainly
aimed at mitigating climate change. Where the two come together, as is often the case in
RE projects, it becomes clear that the label of ‘sustainability’ can easily legitimate projects
that are in many aspects unsustainable. In this way, the co-option of ‘sustainable
development’ discourse by companies, governments and other organisations involved in
large-scale energy projects may well facilitate, rather than impede or modify development
projects that, due to a too narrowly defined conceptualisation of 'sustainability', cause
externalities and conflicts, as in the case studies described in chapter 2 and 4.
One solution to this problem is provided by post-development theorists14
, and
indigenous and peasant movements, many of which argue for a total rejection of both
‘development' and ‘sustainable development’ discourses. From a theoretical point of view
12 Admittedly, in some international finance mechanisms, such as the REDD and the Clean Development
Mechanism promoted by the UN, the meaning of costs and benefits has clearly been expanded to include
environmental services. As yet, however, both the extent and scope of broadening the meaning of benefits
and costs have been insufficient to speak of a paradigm shift
13 The use of the term 'autistic' in this context is partially inspired by the 'Post-autistic economics' movement
that emerged in France at the close of the twentieth century (cf Fullbrook 2007).
14 Post-development theory emerged in the 1980s as a critical theory that, mainly focusing on Latin America
(Ahorro 2008), combined Foucauldian discourse analysis with a wide variety of critiques on the functioning of
dominant discourses on development. Rather than suggesting better ways of carrying out development, or
criticising a specific method or theory, it questioned the very premises on which development theory was
based. For a critical analysis of the post-development theory see, for example, Jan Nederveen Pieterse
(2000) and Morse (2008)
14. 11
there is much to say for taking such a stance, especially in cases where local communities
and livelihoods are severely threatened by both of these discourses. From a pragmatic
perspective, however, an all too radical rejection of the concept of ‘sustainable
development’ might be little effective if no convincing alternative is provided to address the
urgent social and environmental problems facing current and future generations. To be
sure, some alternatives that have been proposed by Post-development theory and related
social movements, when implemented on a very large scale, might prove more effective in
curbing CO2 emissions and reducing rural poverty and migration than any other
proposal15
. However, even in the unforeseeable scenario that these proposals are adopted
as widely as discourses on ‘sustainable development’ have been, and continue to be, their
impact might be limited to certain areas, both in the geographical and topical spheres.
In this light, and given the pretentiousness and widespread adoption of discourses on
‘sustainable development’, it seems to make more sense to use this very concept as a
vehicle for change. To take this theory beyond beautiful sounding words, I concretely
propose a critical embrace of two phenomena that have gained importance in recent
discourses on development: 'responsible investment' and 'social enterprise', and especially
the combination of the two. Admittedly, discourses on 'responsible investment' have been
often misused to promote investments that are irresponsible in many aspects, as
demonstrated, for instance, by the Mareñas project (Chapter 3 and 5). However, that does
not imply that the 'responsible investment' or 'sustainable banking' discourses that have
increasingly been gaining in importance over the last years, are entirely useless. On the
contrary: as Chapter 5 will try to demonstrate, 'responsible investment' criteria can help
social enterprises such as Yansa to attract low interest loans from ethical banks and
15 For instance, the international peasant organisation La Via Campesina claims that “peasant and
indigenous agricultures (with integrated polycultures of perennial and annual plants together with livestock)
can sequester and store huge amounts of carbon and thus cool the planet as well as feed the world”
(Woodgate 2012)
15. 12
socially oriented investors that are ready to accept low financial returns on their
investments.
The concept of 'social enterprise' (an organisation designed to induce positive social
and/or environmental change through commercial activity) has equally been questioned,
especially by those who question the viability of such an entity in a market oriented world
(cf Bylund & Mondelli 2009). Moreover, as Hoffmann (2012) points out, there is a danger
that the people behind a social enterprise, in their determination to induce 'positive
change', unconsciously impose their values and beliefs upon the communities they are
working with16
. In short, the most important risks of a social enterprise are related to (1) the
viability of a project when competing with market oriented companies and (2) unconscious
dominance in ownership and design of a project. However, if these risks can be overcome,
RE projects carried out by a social enterprise –financed by responsible investment
institutions and foundations– should in theory be able to avoid most, if not all, of the
problems caused by the companies carrying out 'sustainable development' through RE
projects in the Isthmus of Tehuantepec and other socially and environmentally vulnerable
areas.
16 This is similar to a phenomenon that has been all too often witnessed in (international) development
projects and NGOs (cf Escobar 1988; Petras 1997)
16. 13
CHAPTER 3
Current trends for power generation
in Latin America and Mexico
3.1. SECTOR REFORMS AND RENEWABLE ELECTRICITY
In the 1980s and early 1990s, countries in the LAC region were encouraged by global
development imperatives and structural adjustment policies dictated by international
financial institutions such as the World Bank to liberalise and unbundle their vertically
integrated, publicly owned, electricity utilities. As Dubash (2003) points out, by the early
1990s this was a common pattern throughout the developing and, for that matter,
industrialised world. For example, after the US in the 1970s had been one of the first
countries to allow private participation in its electricity sector, Chile and the UK –both icons
for neoliberal orthodoxy at the time– implemented even more rigorous reforms in the
following decade (ibid).
Liberalisation has generally led to the entry of independent power producers (IPPs) to
the market (Andrés et al. 2008), which some argue is a necessary factor for achieving a
successful transition to a low carbon economy17
, although these assumptions might
17 For example, in trying to identify barriers to a fast and effective implementation of RE in Latin
America, Lokey (2009) points towards the fact that many countries have not fully liberalised their electricity
markets, which generally leads to state-owned companies or joint-ventures dominating the market, with little
incentive to switch to more 'sustainable' forms of energy production. In addition, low levels of market
liberalisation might prevent innovators from entering the market with 'technological learning' taking place
regardless of what these innovators actually achieve (Miller 2009).
17. 14
especially apply to NCRE technologies such as solar, wind, tide and wave energy18
. In
theory, then, the existence of a causal relation between privatisation of the electricity
generation sector and the use of RE and especially NCRE would implicate that countries
with high privatisation rates have higher shares of (NC)RE in their electricity generation
matrices than countries with low privatisation rates. It is clearly beyond the scope of this
paper to prove or disprove a statistical correlation between the use of RE sources and
private sector participation in the electricity sector. Nevertheless, an analysis of the energy
matrices for 15 countries in the LAC region and their shares of private sector
participation19
suggests that if anything can be said about factors that influence the use of
RE sources in the electricity sector in Latin America, it clearly does not depend on the
amount of private sector participation alone.
3.2. POWER GENERATION IN MEXICO
Contrary to the global and regional trend, Mexico kept liberalisation of its electricity sector
to a minimum during much of the XX century. Even today, the sector in essence still
consists of one vertically integrated public power utility, the Federal Electricity Commission
(CFE), which owns and controls the generation, transmission and delivery of grid-
connected electricity20
. However, in 1992, the Law of Public Service of Electric Energy,
was approved, which opened up the sector somewhat by allowing IPPs to generate
electricity in Mexico. Nevertheless, this is only allowed in the case of self-supply,
independent production, small scale production, co-generation, and import and export, and
only under the conditions specified in this law (Mexico 2012a). The CFE thus remained the
18 In spite of being a source of RE, hydroelectricity is not a NCRE but a well-established technology, and
historically has played an important part in the electricity matrices of many Latin American countries (Arango
& Larsen 2010).
19 Because of the limited space available here, this analysis has been left out of the final version of this
dissertation.
20 To be sure, until recently, that task was divided between the CFE and the Light and Power Company (Luz
y Fuerza del Centro, LyFC), but the latter was liquidated in 2009 by presidential decree
18. 15
most important producer of electric power in Mexico and in 2008 still as little as 19 percent
of electricity generation was privately owned (Lokey 2009).
3.2.1. Brief overview of electricity sources
Over the course of the XX century, through a variety of constitutional laws and
amendments, Mexico had nationalised both its petroleum and electricity sectors (Randall
1989; Uri & Boyd 1997; Carreon-Rodriguez, Jimenez & Juan Rosellon 2007). In this
context, it should be of no surprise that for much of the past century electricity generation
in the country was dominated by oil (Figure 3.1). In 1997, the country generated three
quarters of its electricity with primarily refined oil, with residual fuel oil used for base load
and diesel for peak power and off-grid solutions (Uri & Boyd 1997). The relative
importance of oil diminished somewhat in the 1990s, while nuclear power, RE, coal and
gas gained importance, to varying extents. Following a global trend (IEA 2011d), by 2005
natural gas had established itself as an important player in the Mexican power generation
sector, a trend that is expected and proposed (SENER 2012) to continue in the following
decades. This scenario becomes even more likely21
if the country's enormous untapped
reserve of natural gas are considered, estimated to be the fourth largest in the world (EIA
2011; Rosenberg & Barrera 2011).
21 Some would applaud this development in light of global warming concerns. In the particular case of
Mexican electricity generation, life cycle CO2 emissions of gas were found to be half that of heavy fuel oil and
diesel, and even less than half that of coal (Santoyo-Castelazo et al. 2011). However, most of the gas found
in Mexico is locked up in shale formations, which means it would have to be recovered through a method
called hydraulic fracturing or fracking (EIA 2011). Fracking generally causes local environmental externalities
(Groat & Grimshaw 2012) and increases the GHG “footprint” of natural gas to levels that surpass that of oil
and coal (Howarth, Santoro & Ingraffea 2011: 679)
20. 17
3.2.2. RE and NCRE
While RE has played an important role in Mexico's electricity generation matrix, this can be
contributed almost uniquely to the presence of large hydro. In 2011, Mexico's installed
hydroelectric capacity totalled 11,600 MW, of which all but 1 percent consisted of large
hydroelectric dams. Apart from hydroelectricity, RE sources have historically played a
surprisingly small role in the Mexican electricity generation sector. The underutilisation of
NCRE is especially noteworthy, certainly considering the country's vast and increasingly
well-documented geothermal, solar and wind resources.
For instance, with over 40 active and extinct volcanoes in its territory, only Indonesia
leaves Mexico behind in terms of geothermal potential (DOE 2002). Still, in 2009, installed
geothermal capacity accounted for less than 12 percent of the estimated potential of at
least 8,000 MWe (IGA 2011; DOE 2002). Even more surprising is the “underutilisation” of
Mexico's solar resource (Sanchez-Juarez cited in Navarro 2012). Although the nation's
significant amounts of solar radiation have been acknowledged and studied for decades
(Almanza & López 1978; Galindo, Castro & Valdes 1991), comprehensive studies mapping
the potential for electricity production from solar energy have been elaborated carried out
more recently. These studies unanimously show high irradiation factors for Mexico, with a
nationwide average of 5 kW·day-1
·m-2
and in some parts of the country surpassing 6
kW·day-1
·m-2
(NREL 2003). These values are higher than in some of the countries that
have been leading the solar power market in the first decade of the new century, such as
Germany, Spain and the USA. Still, the entire output of solar PV installations was as little
as 18 MW in 2004 (Barnés 2006). Useful wind resources are also available in various parts
of Mexico. Again, potential seems to be underexploited: only 3 MW of installed capacity
was recorded in 2005 (GWEC 2010: 49). However, in the case of wind energy, something
remarkable must have occurred, because in 2010, installed capacity had increased with
173 percent, making for an average annual growth rate of almost 35 percent (figure 3.2).
21. 18
3.2.3. Explaining the sudden rise of wind energy in Mexico
What explains this sudden and steep expansion of installed wind power capacity in the
second half of the first decade? While other factors may have played a role, five factors
that are especially noteworthy will be briefly discussed in the remainder of this chapter.
The first –and, arguably, most important– factor is economical. The costs of wind power
have fallen significantly in recent decades, mostly due to a phenomenon that economist
have called technological change. In short, this implies that due to a variety of factors,
innovative technologies become both cheaper and better over time (Junginger, Van Sark &
Faaij 2010). In the case of RE technologies, this mostly translates in an improved cost-
efficiency: a lower cost per watt produced. This is especially relevant in the Mexican
electricity market because federal electricity company CFE is constitutionally bound to buy
electricity at the lowest cost. Relative costs compared to other energy sources have also
fallen, mainly because of rising oil prices both on the domestic and international
markets22.
A second factor, closely related to the first, is resource availability and the availability of
accurate data to this respect. Certain areas in Mexico have conditions that are among the
best for wind energy development worldwide, making wind power cheaper than most other
sources of electricity in Mexico (Oceransky 2012). However, as Wood (2010) points out,
only in recent decades have the country’s excellent wind resources fully been appreciated.
Whereas in 2003, Mexico’s wind energy potential was estimated to be 5 GW, “research
and new technologies, as well as a heightened national and international interest in the
sector has meant a steady upwards revision of these estimates”, ranging between 9 and
40 GW (ibid: 23). In 2010, these numbers again turned out to underestimate the country’s
potential in wind power capacity, which was estimated in a new study at 71 GW. For
22 For example, Uri and Boyd (1997) explain how Mexico’s dependence on oil has contributed not only to
higher carbon emissions per unit of GDP than most other countries, but also to a sharp increase in electricity
prices starting in the early 1990s
22. 19
comparison, this number represents a potential capacity that is “40 percent more than the
nation's entire installed electricity-generating capacity, including coal, gas, and hydro
power” (Vance 2012).
These advancements in wind resource intelligence were facilitated by the 'Action plan
to eliminate barriers to the large scale implementation of wind energy in Mexico', initiated
in 2003 and executed by the Mexican Institute of Electrical Investigation (IIE). The plan,
with estimated projects costs totalling nearly $ 12 billion USD, is partly financed by the
Global Environment Facility of the United Nations Development Programme (UNDP), and
co-financed with “contributions from Federal Institutions, State Governments, and the
private sector” (UNDP-GEF n.d.: 1). The plan resulted, among other things, in the building
of of several wind measurement stations and a regional wind technology centre in the
Isthmus of Tehuantepec, one of the most promising areas for wind energy development
(chapter 4).
A third factor consists of a series of government programmes and laws which some
way or another have contributed to a more favourable climate for NCRE. For instance, the
1992 Law of Public Service of Electric Energy discussed earlier (3.2.1) made it possible for
private (wind) energy companies to play a role in Mexico's electricity market. Moreover, in
2008 the Law for the use of renewable energy and the financing of the energy transition
was introduced in order to
“regulate the use of renewable energy sources and clean technologies to generate electricity
with purposes other than the public service provision of electrical energy, as well as establish
the national strategy and the instruments for the finance of the energy transition”
(Mexico 2008: 1).
23. 20
Furthermore, according to the Special Programme on Climate Change 2009-2012, 50.65
MtCO2e would have to be mitigated by 2012, 19.36 MtCO2e of which was estimated to be
mitigated by “projects for self-supply of electric energy with renewable sources” (ibid: x).
These ambitions were made binding in June 2012, when Mexico passed the General
Climate Change Law, which had adopted, among other things, the aspiration to reduce
GHG emissions by 50 per cent in 2050 (taking 2000 as a base year) from the Special
Programme on Climate Change 2009-2012.
A fourth factor that may have facilitated the growth of wind power projects in Mexico is
related to multilateral agreements and regional development plans such as the Plan
Puebla Panama (PPP), an ambitious strategy initially proposed in 200123 with the goal to
“link Central America's energy industry and highways and develop its commercial
capabilities” (Stenzel 2006:557). Apart from the improvement of general infrastructure
benefiting wind projects, the plan helps to justify expansion of wind power capacity through
its Electric Integration System for Central America (SIEPAC), especially in the Isthmus of
Tehuantepec, as Cruz Rueda points out.
“The wind energy megaproject [in the Isthmus of Tehuantepec] denominated ‘clean electric
energy’ is promoted as having the purpose of meeting the energy needs of the states Oaxaca,
Veracruz, Tabasco, Campeche and Yucatán by the year 2020. But in reality it is obsolete,
because the demand can be covered with the currently existing production. Therefore, the
government changes its discourse and promotes the idea of selling generated power to Central
America (through SIEPAC) and to the United States.”
(Cruz Rueda 2011: 264, my translation)
23 In 2008, the PPP was denominated Mesoamerican Integration and Development Project, commonly
called Mesoamerica Project
24. 21
In addition, private sector participation in electricity generation for self-supply, which had
become possible since the 1992 reform of the energy law (see above), was further
facilitated by the signing of the North American Free Trade Agreement (NAFTA), which
states that “[...] an enterprise may aquire [sic], establish, an/or operate an electricity
generating facility in Mexico to meet the enterprise's own supply needs” (NAFTA section 6
quoted in USAID 2009).
A fifth factor that has contributed to the boom in wind energy investment in Mexico is
related to the way discourses on 'sustainable development' have penetrated international
development institutions to promote so-called 'clean' development. The most famous
example is perhaps the United Nation's Clean Development Mechanism (CDM) that
provided financial assistance to wind energy projects such as La Venta II, Eurus, Bii Nee
Stipa (I & II), Parques Ecológicos de México, and Piedra Larga. Moreover, in addition to
receiving funds from the CDM the La Mata and La Ventosa wind farm was partly financed
by the Clean Technology Fund of the World Bank (Reyes 2011: 4).
Finally, in a less official way, investment in wind projects helped institutional investors
and multinationals to nominally allocate part of their investment portfolio to 'sustainable
development' projects and meet Environmental, Social and Corporate Governance (ESG)
criteria. For example, the financial stakes in the controversial Mareña Renovables project
are divided among Dutch pension fund PGGM, Australian investment group Macquarie,
Mitsubishi of Japan and Mexican multinational FEMSA. According to PGGM's head
infrastructure, the fund's significant stake in the project “is completely in line with the ESG
criteria in the investment policy of our clients”. Similarly, a description of PGGM's
investment policy states that “[b]ecause PGGM sees no incompatibility between financial
and social return, we look for investments on behalf of our client in companies which pay
due regard to ESG [...] factors” (PGGM, n.d.). However, as we will see in the following
chapter, the current controversies over the Mareñas project are clearly at odds with such
25. 22
statements.
3.2.4. Wind power in the Isthmus of Tehuantepec
Some of the best locations for wind energy development in the world are located in the
Mexican state Oaxaca (figure 3.3).
Figure 3.3. ‘Oaxaca – Wind Resource Map’
Source: NREL (2003: Figure 6-1)
As can be derived from Figure 3.3 and 3.4, the area with best quality wind resources
roughly coincides with the ethnically diverse region of the Isthmus of Tehuantepec (figure
3.4). As pointed out in Chapter 3, utility scale wind energy development in Mexico and its
Isthmus is a relatively recent phenomenon. In the early 1990s, a pilot wind farm was built
by CFE in La Venta, a small locality belonging to the municipality of Juchitán. The pilot
project, called La Venta I, consisted of a 7 turbines with a capacity of 225 W each, so that
a total capacity of 1,58 MW was reached (Henestroza-Orozco 2008). Technically, the
26. 23
project could be called a great success: the first year, the capacity factor of the power plant
reached 50 per cent, to average a still impressive 40 percent in following years (Cardenas
Tovar & Saldívar Urquiza 2007). The Global Wind Energy Council states that, because
capacity factors in the Isthmus are typically “in the range of 40%, a total of 10 GW could be
developed in this region alone” (GWEC 2011). These promising technical conditions, in
combination with the factors identified in the previous chapter, have led to a spectacular
growth in wind energy projects in the region, especially in recent years (see Table 3.1). In
addition to the completed wind farms showed in Table 3.1, many more projects have been
planned.
Figure 3.4. 'Ethnicities of the Isthmus of Tehuantepec'
S
o
u
r
c
e
:
V
i
l
l
a
g
ó
m
e
z
Source : Villagómez Velázquez (2004: Figure 1)
27. 25
As can be derived from Table 3.1, the majority of developers and end-users of wind
power are (multinational) for-profit corporations or their Mexican subsidiaries, except for
CFE. As discussed in the previous chapter, the principal purpose around which each of
these corporations are structured is making profit; in a similar vein, the primary function of
CFE is the provision of electricity as a public service. In both cases, energy generation is
only a means to this goal. Moreover, a narrow focus on economic well-being and global
sustainability implies that the local impacts of their activities are subordinated to these
companies’ raison de être. As will be shown in the following chapter, this has created a
situation that is incompatible with the idea of 'sustainable development' that has often
helped funding these projects.
28. Table 3.1. Wind power development in the Isthmus of Tehuantepec: projects operational or due in 2012Ethnicregion
Site location Project name
Capacity(MW)
Principal developer(s)
Operational
Principal off-taker(s)
ZAPOTEC
El Espinal
Bii Nee Stipa 26.4
Gamesa in cooperation with
CISA (wind farm bought in 2012
by Iberdrola)
2009 Coca-Cola FEMSA
La Mata,
La Ventosa
Oaxaca I La Mata-La
Ventosa
67.5
Electrica del Valle de México
(Electricité de France Energies
Nouvelles)
2010 Walmart de México
La Venta
La Venta
La Venta I 1.58 CFE 1994
CFE
La Venta II 83.3 Gamesa 2007
Eurus
1st
phase 37.5
Acciona Energía México
Acciona
2009 CEMEX
2nd
phase 212.5 Acciona 2010
Oaxaca II, III, IV 306 Acciona 2012 CFE
La Ventosa
La Ventosa Wind Project /
Parques ecológicos de
Mexico
79.9
Parques ecológicos de Mexico
(Iberdrola)
2009 CEMEX
Bii Nee Stipa II 74 Enel Green Power 2012
CFE
Santo Domingo
Ingenio
La Venta III 103 Iberdrola 2012
Union Hidalgo Piedra Larga (1st
phase) 90.0 Demex (Renovalia) 2012
Grupo Bimbo,
Calidra, Frialsa,
Museo Papalote
Source: Author’s elaboration
29. 26
Chapter 4
Opposing wind in the Isthmus of
Tehuantepec: A tilting at windmills?
4.1. INTRODUCTION
The state of Oaxaca is arguably one of the regions in Mexico where indigenous cultures
have been best preserved (Yannakakis 2008: x). Perhaps one of the most articulated
indicators for this preservation of indigenous culture is the extent to which indigenous
languages are still being spoken. According to data for 2005, more people speak one or
more indigenous languages in Oaxaca than in any other Mexican state (INEGI 2009). An
analysis of data provided by INEGI (2009) reveals that at least 30 different indigenous
languages are spoken by nearly a third of the population of Oaxaca state; of this group,
over 14 per cent speaks no Spanish whatsoever.
Special rights for indigenous peoples have been acknowledged in Mexican federal and
state constitutions, and through the signing of various declarations. For instance, Mexico
was one of the first countries to ratify ILO Convention 169, which explicitly states that
indigenous and tribal peoples
“shall have the right to decide their own priorities for the process of development as it
affects their lives, beliefs, institutions and spiritual well-being and the lands they occupy or
otherwise use [...]. In addition, they shall participate in the formulation, implementation and
evaluation of plans and programmes for national and regional development which may
affect them directly.
30. 27
(ILO 1989: article 7-1)
Moreover, Article 2 of the Mexican Constitution holds that it “recognises and guarantees
the right of indigenous peoples and communities to self-determination and, consequently,
autonomy” (Mexico 2012a: 2). Beyond constitutional limitations24
Article 2 is relatively
straightforward, especially regarding indigenous self-determination to “conserve and
improve [their] habitat and preserve the integrity of their lands” (Mexico 2012a: 2). Finally,
Mexico has signed the UN Declaration on the Rights of Indigenous Peoples introduced in
2007. As will be shown in the following sections, the process of consultation prior to most
wind energy projects in the Isthmus has been insufficient, if at all existent.
4.2. PRIOR AND INFORMED CONSENT
In many cases, the first time communities were approached by energy companies or
subcontracted intermediaries was to obtain permission for leasing the lands. According to
Gonzáles Pedro, this is clearly what is meant by 'prior and informed consent' or similar
formulations in various indigenous rights declarations:
“[The] process of consultation needs to be with all the adequate information. [The
companies] need to demonstrate all the environmental impact assessments, they need to
show how they will affect the lands, […] the amount of turbines, their size, how much
energy they will produce, the importance it has for our region […].”
Gonzáles Pedro (2012)
24 As argued by Hall (2005), the act of formally recognising indigenous rights also provides the recognising
party with the power to define and even delimit these rights. In effect, the Mexican Constitution does set out
a set of conditions and restrictions that delimit indigenous autonomy. However, in essence these limitations
appear to be formulated to protect the Constitution itself –rather than the “neoliberal project”, as Hall
suggests– from being undermined
31. 28
Part of this information, especially related to environmental impacts, is presented in the
Environmental Impact Manifests (MIA) that companies need to present to the Secretary of
Environment and Natural Resources (SEMARNAT) in order to have approved their
projects. However, as González Pedro (2012) explains, “in general, none of the companies
has prepared an environmental impact assessment before the [land lease] contracts are
signed”. Moreover, as will be discussed in section 4.6, there is a tendency for MIAs to
underestimate negative environmental impacts (Grosselet 2012; Monroy 2012; González
Pedro 2012).
4.3. LAND LEASE CONTRACTS
Wind energy companies in the Isthmus lease the land on which they build their wind farms,
instead of buying it. Wind farms need a relatively extensive land area, principally because
the space between modern wind turbines in a row needs to be some 250 meters, and the
space between two rows of turbines about half a kilometre (CANWEA 2006). In other
words, while in most cases large tracks of land are needed to build a wind farm, most of
that area solely serves the space between turbines and thus can still be used for other
purposes such as farming and grazing, especially when construction has finished (at least
in theory25
). Since in many cases the lands with the best wind resources are found in rural
areas, buying instead of leasing land could unnecessarily interfere with other uses,
principally farming and grazing. As will be discussed below, however, the principal reason
for companies to prefer lease contracts over buying land is most probably related to
financial concerns.
An additional reason companies in the Isthmus lease instead of buying land is the
complex regulation of land ownership in Mexico that can be traced back to the Mexican
25 As later sections in this chapter will make clear, the conditions for this theory to become fully applicable in
practice have not always been met in the wind projects discussed in this case study
32. 29
Revolution (1910-1917). Through a process of drastic land reform starting in 1914,
thousands of indigenous communities were issued communal property rights through the
establishment of comunidades agrarias, whereas ejido landholding structures were
generally allocated to non-indigenous26
peasant communities (Smith et al. 2009). In line
with other neoliberal policies promoted by the Washington Consensus, land markets were
opened up somewhat in the early 1990s, especially through the reformulation of Article 27
and the Agrarian Law in 1992, and through the Certification Programme of Ejidal Rights
and Titling of Urban Lots (PROCEDE). Nonetheless, although land leasing and renting
significantly augmented after these counter-reforms, the same was not true for the sale of
ejidal and communal lands (Assies 2008). One of the reasons for this is that PROCEDE,
the certification programme that would facilitate such a privatisation process, advanced
slower than expected. This has especially been the case in Oaxaca, where over three
quarters of total surface area is compromised by ejidal and communal lands (Secretaría de
la Reforma Agraria 2012a).
4.3.1. Landholder consultation
From the perspective of energy companies, protests from local landholders against wind
energy development in the Isthmus are all too often dismissed as a conscious strategy to
get more money, certainly because protests usually began after the contracts were signed.
However, an increasing bulk of evidence is supporting claims made by landholders,
indigenous/human rights defenders and others, that in many wind projects land lease
contracts were obtained through a process that was full of “irregularities” (Manzo 2011:
391).
In the early years of wind development in the Isthmus, landholders had little idea what a
26 Admittedly, this categorisation into indigenous and non-indigenous has not been straightforward, and
probably could not have been, not least because of the theoretical and practical complexities inherent to
indigenous (self)identification processes in particular (Weaver 2001), and to concepts as ethnicity,
indigenous identity and mestizaje in general (Banks 1996; Rubin 1997; Da Silva 2012)
33. 30
wind farm would look like27
. As Vance (2012) explains, some landholders had “meetings
with developers in which model windmills the size of dinner platters were shown” and after
having signed contracts “were shocked to see 15-to-20-story turbines rise across acres of
their land”. The fact that CFE and other companies developing wind projects in the region
have subcontracted intermediaries to obtain the land lease contracts, might have facilitated
this process (Manzo 2011). A notorious example is Maderas y Granos, according to
Sanchez (2007) “a cover name for this speculation company whose representatives go
around trying to arrange contracts […], all while saying that they work for the government”.
A point in case here is the La Venta wind farm, as a publicly funded study reveals:
“[T]he ejidatarios that leased their lands did that initially to companies that apparently offered
productive projects like that of SEDESOL, such as Maderas y Granos […], which afterwards
sold the contracts to other companies that had won bids for the construction and operation of
wind farm; this process makes [the landholders] feel betrayed.”
(Ciesas, n.d: 105)
A similar example can be found the village of Xadani where, in 2006, “the company men
made it sound like a government aid program, and […] many small landowners signed up
even though they couldn't read the contracts” (Hawley 2009).
In Unión Hidalgo, landholders were approached on an individual basis by
“representatives” of the Piedra Larga project, who after landholders had agreed to signing
a contract “returned with the 'official' copies of the contracts [in which] many key terms had
been changed, endless clauses added, and the term of the lease had been changed from
twenty to thirty years” (Sanchez 2007). While some landholders were wisely opted out
before the definitive signing of the Piedra Larga contract (Díaz 2012), many did not fully
27 In recent years, this can be expected to have changed somewhat due to the the increased visibility of
wind turbines in the region, as well as information diffusion through indigenous and human rights groups
34. 31
understand what had happened and signed the contracts anyway, reportedly under
pressure of the intermediaries and their notaries (Sanchez 2007). In a similar vein, Girón
and Beas Torres (2010) account how Maderos y Granos was charged with the landholder
'consultation' for the Eurus wind project, during which some plots were reportedly seized
while no contract had been signed. In most cases, however, Maderos y Granos reportedly
manipulated landholders into signing lease contracts, and since no copy was provided,
conditions could be –and were– easily changed afterwards (ibid).
In addition, the CFE and multinationals have allegedly obtained land lease contracts
illegally through local and regional leaders and caciques28
, who received a commission per
signed contract (Oceransky 2009). For example, although a court case related to these
allegations has as yet been undecided, the then president of the Commission of Ejidal
Goods of La Venta allegedly bypassed consultation procedures with the ejido council to
negotiate land deals directly with CFE, receiving significant payments in return (Oceransky
2008; Girón 2012). According to some sources, this process has been companied by
forging signatures of people who were openly against the project, migrants working
abroad, and people that had already died (Girón 2012; González Pedro 2012).
Finally, translation of the contract terms in indigenous languages has been often
selective and sometimes absent in cases where landholders did not speak Spanish, and
contracts were not read fully to illiterate farmers (Oceransky 2009). For illustration, it
should suffice to mention that in La La Venta, more than three quarters of the population is
illiterate (Girón 2012). This fact, in combination with the workings of caciquismo may also
partly explain the fact that an order from Ulises Ruiz —then governor of Oaxaca for the
Institutional Revolutionary Party (PRI)— to sign land lease contracts addressed to the PRI
28 As can be concluded from contemporary works on caciquismo, the exact use and meaning of the term
cacique continues to be subject to academic debate (cf Knight & Pansters 2006). Originally, the term was an
“Awrak term denoting a chief […]; in colonial Mexico, caciques were indigenous rulers” however, from the
nineteenth century the term was “detached from its indigenous roots and came to denote a form of political
boss, mediator or broker” (Knight 2006: 10).
35. 32
dominated La Venta ejido “was blindly obeyed by a high percentage of the population”
(Oceransky 2009: 209).
4.3.2. Financial structure and transparency of land lease payments
One reason companies might prefer to lease land instead of buying it, is that the
acquisition of large lands areas needed for a wind projects would significantly increase up-
front costs, already taking up the greatest share of total project costs for RE. Lease
mechanisms, on the other hand, allow for spreading the costs more evenly over the
lifetime of a wind farm, typically twenty to thirty years. Moreover, unlike in the case of
instalment sale agreements, the financial structure of lease contracts can be designed in a
way that makes leasing a more cost-effective option and lowers financial risks. In the
contracts reviewed for this section (see Table 4.1), the greatest share of payments is
allocated to landholders whose lands are directly affected by power generation equipment
and related infrastructure. In a similar vein, Table 4.1 shows that payments structures are
generally differentiated by two phases: the pre-operational phase, which can take up
several years and in which the technical assessments, environmental assessment,
planning and construction are carried out; and the operational phase, which can usually
last between 20 and 30 years, depending on the contract.
Another way landholders are financially compensated is through royalties payments.
This could be perceived as a sympathetic gesture of sharing part of the project revenues
or as a conscious company strategy to externalise financial risk29
. What is clear is that, by
making part of the payments directly dependent upon project revenues, energy companies
can mitigate financial risk while at the same time increasing landholders' engagement in
the project and their sense of responsibility for the project to succeed. The last column of
Table 4.1 shows that in the reviewed contracts, the royalties landholders receive are
29 For a detailed elaboration on the externalisation of risk in wind projects in the region see Baker (2011)
36. 33
calculated by dividing a share of gross revenue (typically 1-1.5 percent) by either the total
surface area or by the total amount of landholders. However, as Oceransky (2010) points
out, many wind projects in the region are developed by large consortia consisting of a
power producer and the final power consumer; consequently “since the pricing policy
within the consortia is internal, the consortia could establish the value on an arbitrary
basis” (ibid: 618).
In any case, while a detailed comparative analysis of land lease payments is beyond
the scope of this thesis, several authors (Pasqualetti 2011; Vance 2012; Girón 2012) have
calculated payments to be significantly lower than in other places in the world that have
similar wind resources, although there seems to be little agreement on the exact amounts.
According to Vance (2012), small landholders in La Venta have been paid “a third to a
sixth” of what farmers receive in south east Wyoming. Girón (2012) holds that according to
his calculations based on company figures, landholders in La Venta have been paid up to
twelve times less in terms of revenue share than their counterparts in other countries.
Arguably, the underpayment of farmers has been facilitated by the disadvantaged
position of landholders in the Isthmus (Baker 2011; Oceransky 2009). Soon after the
exceptional quality of wind resources in the Isthmus had been mapped out by experts in
the first decade of the new century, “a group of primarily Spanish and French companies
[…] moved quickly to identify a strategy that would effectively divide El Istmo into
development parcels to serve as individual sites for wind projects” (Baker 2011: 280). As
Oceransky (2009) points out, this strategy has prevented competition between companies
over the same land parcels. Consequently, each company gained a monopsony30
position
in the land negotiation processes, allowing contract terms to be dictated entirely by the
30 Similar to a monopoly, where the market is dominated by one supplier, a monopsony implies a situation
where many suppliers are dependent on one buyer. Although in this case the transactions are based on
lease contracts rather than instalment sale agreements, I still consider the use of the word monopsony
adequate in this context.
37. 34
companies31
.
31 Exponential increases in land lease offers, which cannot realistically be attributed to other factors, seem
to support this assumption (Oceransky 2009).
38. Table 4.1. Financial structure of land use payments (in MXN) by to wind power companies: select lease contracts
Company
and
locality
Pre-operational phase Operational phase
Lump sum
payment
Fixed annual
fee per
ha
Fixed annual
fee per
turbine
Fixed
annual
fee per
ha
Fixed annual
fee per
turbine
Royalties
(R)
a
Unión
Fenosa
Juchitán de
Zaragoza
1.000 150 4.000 N/A N/A 1. All landholders in project area:
R = (0,010GR
a )
2. Landholders whose plots are
affected by the wind farm (by
turbines, access road, cables,
etc.)
R = (0,010GR
a ) + 0,002 GR
3. Landholders with at least one
turbine on their plot:
R = (0,010GR
a ) + 0,005 GR
DEMEX
Union
Hidalgo
1.500
b plots
> 4
ha:
250
plots
< 4
ha:
1.000
5.000
c
10.000
d
15.000
c
R = (0,015GR
a )
Endesa
Xadani
e
(≈486-503) (≈2388-2474)
d
+
(≈60-63)
f (≈60-63) f
R = (0,014GR
l )
Source: Author’s analysis of original land lease contracts (see Appendix) for Union Fenosa and DEMEX; Hawley (2009) for Endesa.
Notes: [a] Royalties in formula (in which R=Royalties; GR=Gross Revenue based on annual (DEMEX) or trimestral (Unión Fenosa) electricity sales
(payment period not identified for Endesa); a = total surface area in ha; l = total amount of landholders). All formulas are author’s elaboration based on
primary (Unión Fenosa; DEMEX) and secondary (Endesa) contract descriptions; [b] aggregation of two payments, at different stages of the preoperational
phase, of 1000 and 500 MXN; [c] solely paid to landowners whose land is directly affected by the turbine(s) ;[d] solely includes areas affected by wind farm
equipment, such as turbines, access roads, cables, etc.; [e] estimated numbers based on amounts provided in USD by Hawley (2009) converted to MXN
using the lowest (1 USD = 13.122 MXN) and highest (1 USD = 13.593 MXN) exchange rate of June 2009, rounded to decimals; [f] payment formula (in
which t = amount of turbines; l = total amount of landholders) based on description provided by Hawley (2009).
((≈3937−4078)t
l ) ((≈3937−4078)t
l )
39. 36
4.4. IMPACTS ON ARGICULTURE
As pointed out earlier, the presence of wind power equipment should in theory not
significantly reduce possibilities for agricultural uses of the land, and companies rightly
point out that many disruptions caused by construction are temporary32
and mainly
restricted to the construction period. However, there are concerns among landholders that
not all modifications might be temporary. In La Venta and La Ventosa, for instance, altitude
levels of lands in irrigation zones have been modified in order to construct access roads,
which may compromise agricultural productivity because in the period of heavy rains, “part
of the parcel gets filled with water, so [...], the harvest, many harvests, are lost” (Gonzáles
Pedro 2012). However, according to Oceransky, these impacts occur mostly in irrigated
areas and could have easily been prevented, especially in the case of La Venta II, “where
they did it very badly”.
“It is possible to build wind farms without affecting in this way. They just did not give it
priority. There is no need to augment [the level of] roads. It depends on how you design
them. And if there is any part where you need to augment levels, you can create drains,
based on calculations”.
(Oceransky 2012)
Moreover, while the surface area taken up by the turbine foundation is relatively small33
,
farmers fear that the estimated 1500 ton “blocks of concrete that make up each turbine's
32 As Brian (2010) points out, in most cases, the 'local jobs' these companies usually promise are usually
equally 'temporary', apparently closely related to this construction period. After this period, maintenance jobs
can be filled by a handful of specialists, commonly from outside the region (Vance 2012). At the La Venta
wind farm, for example, only 5 persons are currently being employed for maintenance (Girón 2012).
Moreover, wind farm labourers have repeatedly put construction on a hold because of unacceptable working
conditions and payment uncertainties.
33 According to BP (2012), the surface area taken up by the base of one turbine including the access road is
typically between 0,3 and 0,4 hectare.
40. 37
foundation will hinder the natural flow and drainage of water, causing their crops to be
flooded” (Brian 2010; Manzo 2011; González Pedro 2012).
A final issue related to agricultural impacts is that, after a land lease contract has been
signed, the land becomes automatically “fixed” (González Pedro 2012). In practice this
implies that farmers with a type of land right that previously allowed them to use their piece
of land as collateral for small agricultural loans (commonly used to buy seeds and
fertilizers) are no longer able to do so. According to González Pedro, this is not explicitly
communicated to landholders and contract details on this clause are usually limited to
ambiguous statements on the ample usufruct rights granted the company, articulated in
“technical juridical language” (ibid). Consequently, farmers often do not become aware of
this term until asking for a loan at their bank, usually provided on a yearly basis (ibid).
4.5 ENVIRONMENTAL IMPACTS
As pointed out earlier, prior to each project, companies need to prepare a MIA in which the
expected environmental impact of the project is assessed. However, there are many
reasons to assume that negative environmental impacts are generally underestimated in
the MIAs (Grosselet 2012; Monroy 2012; González Pedro 2012).
First, the MIAs consider the impact of individual projects as if they were isolated, rather
than being part of an increasingly large scale scale project concentrated in a limited
geographical space (Manzo 2011; González Pedro 2012). As Manzo (2011: 397) explains,
“this situation […] ‘favours’ the approval of the projects […]”. Another implication of this is
that the potential of mitigation efforts is overestimated, especially concerning the effects on
local and migrating bird and bat populations (González Pedro 2012). Secondly, MIAs are
based on a project design that often changes afterwards. For example, in the case of La
Venta II, the amount of turbines that was eventually placed exceeded the amount on which
the MIA was based by over 16 percent (Manzo 2011: 399). A third factor that may
41. 38
contribute to the underestimation of negative impacts of the projects is that companies pay
researchers not to publish their findings (Grosselet 2012; Monroy 2012). Leaving aside
any speculations about the companies’ possible influence on how data is presented, this
lack of transparency may well impede wider possibilities of peer review and cross-
verification that can filter out questionable methodology as well as flawed data-
interpretation34
.
One area in which all the the above mentioned factors can be discerned is the impact
on local and migratory bird populations. As pointed out earlier, the Isthmus of Tehuantepec
is a crucial corridor for migrating birds and habitat of several endemic species, such as
Percale sumichrasti, Passerina rositae, and Aimophila sumichrasti (Rodarte García 1997;
BirdLife International 2012). Each year, the Isthmus of Tehuantepec is used as a corridor
for about 12 million migrating birds of at least 130 species of which many are protected by
Mexican law (Vélaz Ascencio 2012). One effect wind farms has on these birds is causing
lethal collisions with wind blades. This problem has been widely recognised, including by a
case study of La Venta II under the umbrella of the World Bank (Ledec, Rapp & Aiello
2011). However, the numbers of casualties provided in this study are probably
underestimated, as the authors of the report and testimonies by other ornithologists point
out (ibid; Grosselet 2012; Monroy 2012). Reasons for this include the fact that measures
are taken in a limited area around turbines –whereas some birds may still be able to fly
some distance after a collision before passing away– and that predators removing
cadavers are not taken into account (Ledec, Rapp & Aiello 2011; Monroy 2012; Grosselet
2012). Anonymous researchers previously contracted by wind companies argue that the
methodology being used is “not […] adequate” for the aforementioned reasons and
because the focus is only on large species, while “the bulk of the [migrating birds] are
34 For instance, Manzo (2011) finds that in the MIA of the Mareñas project (Chapter 5), “the environmental
impacts […] were evaluated and approved without any verification of the presented information, in which
according to the MIA some data to be evaluated correspond to another region unrelated to the project site”
42. 39
missing, the small ones make up millions” (Anonymous researcher cited in Rojas 2012).
The researchers warn that if the bird mortality assessed for the case of La Venta II is
multiplied by the thousands of turbines that are being placed in the Isthmus, serious
consequences can be expected for the function of birds and bats in all of the continent,
especially in related to their functions in seed dispersal, pollination and as insectivores35
(ibid). This is one of the reasons two ornithologists with extensive knowledge of bird
populations in Mexico and the Isthmus of Tehuantepec declare to be in principle in favour
of wind energy, “but not in the Isthmus” (Monroy 2012; Grosselet 2012).
4.6. THE MAREÑAS PROJECT: THE BELO MONTE OF WIND ENERGY?
The Mareña Renovables (Mareñas) project will be the first wind farm to be located around
the interconnected lagoons and estuaries in the coastal area of the southern Isthmus
(Figure 4.1 and Figure 4.2). If the Mareñas project is constructed according to the original
plan, 102 large turbines (3 MW each) will be placed on the Barra Santa Teresa (thin barrier
in figure 4.2) and 30 of the same turbines on the Barra Tileme (thick barrier in figure 4.2),
making it the biggest wind project in Latin America. Although the map in Figure 4.1
(Chapter 3) would suggest wind conditions in these locations differ little from those found
up north, the continuity of the resource in the former area is even better than in the latter.
Moreover, building the turbines on sea barriers closely approximates the essence of an off-
shore wind farm (Vance 2012), which typically catches more wind but is also more
expensive than its onshore counterpart. It is in this context, interest for wind development
in this particular area becomes understandable.
However, this coastal region is also home to indigenous fishing communities called
Ikooc or Ikoot in their own language, more widely known by as the Huave Indians (Cruz
35 For humans, this last point is especially relevant in the light of devastating impacts of insect plagues on
harvests and of mosquito species transmitting dengue, malaria and chagas throughout the continent, the
latter of which has been recently been denominated “the new HIV/AIDS of the Americas” (Hotez et al. 2012).
43. 40
Rueda 2011). For this ethnic group, the wind is 'sacred' (Vance 2012), as are certain areas
that are included in the design of the Mareñas project, such as the Tileme island36
or
Pueblo Viejo (Vélaz Ascencio 2012). Exploitation of primarily shrimp in the Laguna Inferior
is dominated by the Huave or Ikoots, while the Laguna Superior is exploited mainly by
Zapotecs (ibid). As a consequence, the project is increasingly protested by both Huaves
and Zapotecs, who fear the project will damage ecosystems and restrict the natural flow
of salt water between the lagoons and the Pacific.
The Mareñas project was first proposed in 2004 by the Spanish company Preneal, who
planned to develop it through Mareña Renovables S.A.P.I. de C.V., a financial vehicle
registered in Mexico37
. In 2011 Preneal had already secured about 1500 hectares in San
Dionisio del Mar (Manzo 2011). According to Vance (2012), community members of San
Dionisio initially disapproved eventually but gave in after Preneal representatives 'warned'
the community that rejecting the project might have harmful consequences for the local
shrimp industry. Moreover, the community assembly in which the project was approved
was presented by Enrique Toledo and Álvaro Velasquez, two government officials the
former of which was in charge of assessing ejidos and comunidades agrarias (Rojas
2012). In the light of the influence these government officials have in the communities they
assess, their presence might have influenced the decision of the San Dionisio community38
(González Pedro 2012). Local caciques may have also played their part. For instance, on
21 January 2012, mayor Miguel López Castellanos allegedly signed building permits for
the Mareña project without the approval of the community assembly.
36 'Peninsula' would perhaps be a better description, since the Pueblo Viejo is connected to the mainland by
a the Tileme barrier (Figure 4.1)
37 In 2012, a group of investors including FEMSA, Mitsubishi, PGGM and Macquarie acquired a majority
stake in both Mareñas Renovables and the project itself (chapter 3).
38 Tellingly, after the contracts signed in San Dionisio, Velasquez was hired by Preneal (and later by
Iberdrola) and Toledo was contracted by Acciona (González Pedro 2012)
44. 41
Figure 4.1. ‘Chart of the Tehuantepec lagoon complex'
Source: Cromwell (1984: Figure 3)
Figure 4.2. 'Direct and Indirect area of influence of the Project '
Source: IADB (2011: Figure 7)
45. 42
Chapter 5
Towards the first community-owned
wind farm of Latin America
5.1. INTRODUCTION
With a population of around 26,450 Ixtepec is a fairly small city. Land ownership has been
organised in a comunidad agraria and administered by the Comisariado de Bienes
Comunales (Commission of Common Goods), or comuna. The comuna is a legal body
that according to Mexican law serves as a ‘representative and administrative organ of the
assembly of comuneros [comuna members] on the terms that are established by the
communal statute and custom’ (Mexico 2012b: 22). The original idea of a COWF for
Ixtepec arose during a course on territorial planning, along with other proposals such as a
site for nature conservation and a site for agricultural development (Vásquez García
2012). To be sure, these were still only ideas, and in case of the COWF nobody had a
clear vision of what it would look like, how they would be able to build it, nor where the
finance would come from.
“They [other community members] told us: you are insane, who is going to come and do it?
You have no resources to do it, nor the necessary contacts. And they were right. We were
living completely in a dream world.”
(Vásquez García 2012)
46. 43
By chance, however, they heard about Sergio Oceransky, who was starting an
organisation named Yansa aimed at facilitating community owned wind projects. What
followed was a series of assemblies, the final of which took place on 23 October 2011,
when the COWF and Yansa's involvement in the project was approved for the second time
by majority vote39
. Yansa's founders emphasise that they “are very critical of corporate
globalisation [and] definitely come from a different space […] as a normal wind developer”
(Mozen 2012) and that the community of Ixtepec “will have the final word on whether to
undertake the project” (Oceransky 2010: 747). In the light of their background40
, both
founders of Yansa may be entrusted with such statements, which are among the basic
principles on which the Yansa is constituted (Oceransky 2010). Moreover, the complex
legal structure of the Yansa Group is designed in such a way that conflicts between
community interests and financial interests of investors and the CIC have been made a
practical impossibility (cf Oceransky 2010; Hoffman 2012).
5.2. LOCATION OF THE PROJECT
Originally, the comuneros that came up with the idea of the COWF had proposed an area
that was not being cultivated. However, ornithologists invited by Yansa pointed to the
importance of the site for biodiversity and an endemic bird that was nesting there
(Oceransky 2012), so a new location was needed. A garbage was proposed instead, but
this proposal met with protests from people that had squatted the place (ibid). The final
proposal was an area in the north-east of Ixtepec territorial scope (Figure 5.1 and 5.2),
which is currently used for crop growing (principally maize) and low intensity cattle farming
39 Video footage of this event has been made public and is available at:
http://www.youtube.com/watch?v=6prYIiA5CtQ
40 Oceransky has previously been working as a grass-roots development worker and as a coordinator of the
World Wind Energy Institute, a network of training institution aimed at democratization of wind energy
intelligence. Mozen became famous as spokesperson of the group that coordinated the protests against
economic globalisation during a meeting of the IMF and the World Bank in Prague in September 2000
(Schattle 2008).
47. Figure 5.1. The proposed location for the community based wind farm
community bsed wind farm
Source: Author's elaboration of a satellite photo reproduced by José Luís Alvarez Palacio
Note: red circle is meant as approximate indication of the area, which was still being defined at the time of writing
Figure 5.2. Views of the proposed wind farm site from the “Super” highway
Pictures on top and below left by Bart de Swart; picture on below right courtesy of The Yansa Group.
La
Ventosa
CITY OF IXTEPEC
Nizanda
La Mata
Santo
Domingo
Chihuitán
Carrasquedo
Zapote
“Super” Highway
48. 44
(Sustentavía 2012a). As yet, the proposal of this site has generally met with positive
response from the posesionarios of the plots that make up this area.
5.3. COMMUNITY OUTREACH
In March 2012 it was highlighted by Vargas (2012) that not everyone in the community
was informed or even aware of the project. However, significant efforts have been made
since then –as had been the case before March 2012– to inform and consult the Ixtepec
community about the project (Mozen 2012; Vásquez García 2012). The principal agents of
this process have been Sergio Oceransky and the comuneros most actively involved in the
project, through channels that compromise, but were not limited to “all the organised
bodies in Ixtepec” (Mozen 2012), documentaries, personal visits, and word of mouth. In
addition, social scientists working for Sustentavía, as well as a student from Lund
University41
have – while carrying out their research through interviews, surveys, and focus
groups– further contributed to a wider and deeper understanding of the project among
community members (Mozen 2012; Vásquez García 2012). However, as Vásquez García
(2012) points out, there are limits to what can be done to inform people, if they do not want
to be informed: “you invite them and the people say no, I don not possess land in that
area, why should I go?”
5.4. LANDHOLDER CONSULTATION
Although Yansa might explicitly state it fully respects self-determination of individual
community members and the community as a whole, one might argue that the Yansa
Group has limited influence on the way empowered community members behave in the
consultation process (Hoffmann 2012). During my fieldwork I have been extremely alert for
signals that could suggest some way of 'steering' by the communeros consulting
41 See Hoffmann (2012) for the impressive and insightful result of this student's efforts
49. 45
landholders, especially when a small group of landholders appeared to have turned
against the project (section 5.3.4). From the observations I was able to make, no such
signals were evident. For example, every landholder we spoke to was told explicitly, and
sometimes in tireless repetition, that if they did not want to participate, “no pasa nada”42
.
Furthermore, in discussing the progress of the consultation process, comuneros agreed
that “if they don't want, they don't want, we will respect their choice”. Moreover,
landholders were constantly reminded that from the moment of registration it would take
until January 2013 until the results of the CFE bidding process would be known and no
'definitive' contracts nor any payments could be expected before that time.
5.5. PAYMENTS AND SOCIAL BENEFITS
Due to the heated performance of one of the four brothers holding usufruct rights to the
largest tracks of land in the proposed COWF – let us say his name was Antonio43
– the
meeting of 11 July 2012 (see above) got a little tense. Antonio, who arrived late at the
meeting, accused comunero Juan of becoming “a millionaire” through the COWF.
Essentially Antonio and a small group of peers argued that landholders were paid too little
relative to the income the project would generate.
At this point, too much of the project is still too undefined to make even an educated
guess about the expected annual revenue of the COWF. For instance, Yansa could not
start the technical design of the 100 MW wind farm until the outcome of the landholder
consultation process was known. Without this design, it would be difficult to calculate the
exact costs –estimated by Oceransky at about $ 200 million USD (Oceransky in Hoffmann
2012: 13)– and financial viability of the project, and consequently, to obtain long term loans
needed for the high upfront costs. In addition, as discussed earlier, CFE is constitutionally
bound to buy electricity at the lowest cost possible. According to Oceransky (2012) at least
42 Literally “nothing happens”, a Spanish expression to reassure someone that “it's okay”.
43 For reasons of discretion I prefer not to mention his real name here
50. 46
11 private wind developers are known to join the CFE in the bidding process and
competition is expected to be fierce; consequently, there is much uncertainty on exactly
how low the the COWF's offer will need to be44
.
However, even without this information it is possible to review the allegations that
farmers would be underpaid relative to whatever total revenue may be. To this end, I briefly
need to explain the structure of financial flows if the project as communally agreed upon
through various steps in the consultation process45
. In essence, any surplus income
generated by the project after debt servicing and interest payments will be split into two
equal shares. One share (a) is reserved for the Ixtepec community and will be
administered through a trust that is democratically controlled through various existing
organisations, such as the comuna, a women's forum and a youth forum. The other half
(b) will be shared by (b1) the Yansa Foundation, which fully owned by the participating
communities, and (b2) a guarantee trust designed to minimise risk in an measure inversely
related to the amount of risk, which in turn is inversely related to the share of the debt that
has been serviced (Hoffman 2012). Of share (a), one part (a1) will be reserved for land
holders and the rest (a2) will be reserved for 'sustainable development' projects which will
be proposed and democratically approved through the aforementioned new forums an the
existing bodies.
As this structure makes clear, if carried out as designed, it is practically impossible that
anyone become rich of the COWF. In fact, the only people that get individual income from
the project are the landholders themselves. On the non-binding document the landholders
were offered to sign, it is clearly stated that individual payments would be as follows (Table
5.1.).
44 Moreover, as long as loans have not been secured, it is unclear under what financial terms (particularly
interest rates) the project can be developed, in other words, how low offered power rates can be.
45 While detailed descriptions of the complex structure that will regulate financial flows of the COWF have
been provided elsewhere (Oceransky 2010; Hoffmann 2012), for the purpose of this paper I will provide a
simplified version here
51. 47
Table 5.1. Proposed individual payment structure for landholders in the Ixtepec COWF
Payment per
turbine
Payment for temporal impacts
on lands
Payment for structural impacts on
lands
$ 30.000 MXN $ 10 MXN m-2
y-1
($ 100.000 MXN ha-1
y-1
)
$ 15 MXN m-2
y-1
($ 150.000 MXN ha-1
y-1
)
Moreover, the document states that by signing the document, the landholder will form part
of a civil association solely consisting of the landholders of the wind farm area. This
organisation will receive approximately $ 2 million MXN per year “for productive
investments and social development, from the moment electricity generation starts”, as the
document states. In sum, if these amounts remain unchanged or go up in the final
contracts, financial and social compensation for landholders can be expected to be many
times better than in the other projects in the region.
Moreover, as a study by Sustentavía points out, the majority of the landholders that
currently farm the land use the yield solely for subsistence, and in general, productivity is
low (Sustentavía 2012). Most farmers indicated that they would like to improve and
commercialise production, but they need equipment, a well, and irrigation systems (ibid).
The extra individual income in combination to the funds channelled through the
aforementioned civil association can be expected to facilitate this. Asked what 'sustainable
development' projects have been so far proposed, among other things Vásquez García
(2012) named the creation of a well for landholders, various innovative irrigation systems,
and workshops on agroecological farming methods. The latter will “allow better productivity
without needing to add chemical fertilisers” (ibid).
Finally, a problem many landholders were complaining about was a recent increase in
cattle theft by outsiders, according to some accounts facilitated by the “Super” highway
built in recent years (Figure 5.1 and 5.2). One sceptic landholder commented that, rather
than being convinced by the 'benefit' of paved roads that would facilitate access to lands,
52. 48
he feared that this would only further increase cattle theft. However, due to the presence of
security staff that will be hired from the local community to guard the wind farm area, the
COWF will more likely result in a decrease in cattle theft.
5.6. CULTURAL ASPECTS
In at least two ways the COWF can be expected to have a positive influence on the local
culture in Ixtepec. On the one hand, as pointed out above, it might increase agricultural
productivity; this in turn, might help preserve a culture of working on the land, which is
especially being lost in younger generations (Vásquez García 2012). On the other hand,
one of the development proposals that have been identified as deseving priority in the
women's forum was a programme for the preservation of indigenous languages. As
suggested by the outcomes of a study by Sustentavía (2012b), Zapotec and other
indigenous languages are being lost as they are spoken by only a small percentage of the
younger generation in Ixtepec. If the aforementioned proposal turns into a sustainable and
effective programme, the COWF will indirectly have contributed to the preservation of
culture46
. This would mean a remarkable contrast with the common many (wind energy)
development projects in the region that are being perceived as a threat to local culture and
social cohesion, as we have seen Chapter 5.
5.7. ENVIRONMENTAL ISSUES
To be true, one part of the COWF plan (as approved by the comuna) stipulates that the
area originally proposed for the wind farm site will be used as an environmental
conservation area “to mitigate the environmental impacts of the wind farm” (Oceransky
2012). To this end, the posesionarios of this area will be paid for making sure biodiversity
46 In a similar vein, Pinel (2009) has shown how two Pueblo communities in New Mexico have used
development to preserve their cultures
53. 49
can flourish unrestrictedly47
. As Grosselet (2012) notes, although the idea is “sympathetic”,
it will not be able to mitigate bird mortality through turbine collisions. A more effective
mitigation effort, as two ornithologists independently argue, would be to put the turbines on
hold during certain time periods birds are known to fly near turbines (Monroy 2012;
Grosselet 2012). According to Oceransky (2012), these types of measures have indeed
been included the “energy production model”, as well as the financial losses that might
result from this.
47 This idea is not new, of course, and resembles the UN-REDD programme and other mechanisms that
facilitate payment for environmental services, including various Mexican initiatives
54. 50
CHAPTER 6
Conclusions
In this dissertation, I have first tried to show that socio-environmental externalities and
conflicts resulting from RE projects in Latin America are not confined to place or type of
technology, although both may cause significant variations in the nature and intensity of
these externalities. The following common denominators could be identified: (1) the lack
of consultation of the local communities; (2) the fact that generated energy does not
directly benefit local communities; (3) focus on 'clean' aspects of the project (low carbon
emissions), and underestimation of local impacts in company discourses and impact
assessments.
Secondly, I have identified six factors that may have contributed to the growth of wind
development in Mexico and the Isthmus of Tehuantepec: (1) falling costs; (2) wind
resource and data availability, facilitated by the 'Action plan to eliminate barriers to the
large scale implementation of wind energy in Mexico'; (3) a series of government
programmes and laws creating a more favourable climate for NCRE; (4) multilateral
agreements and regional development plans; (5) penetration of 'sustainable development'
and 'clean energy' discourses in international development and finance institutions (6)
efforts by institutional investors and multinationals to meet ESG criteria.
Consequently, I have identified the ways in which wind energy projects have been
affecting local communities and their environment in the Isthmus of Tehuantepec. As I
have tried to show, it is especially the consultation and participation of indigenous peoples
described in ILO Convention 169, their “autonomy” described in the Mexican constitution
55. 51
and their “free and informed consent prior to the approval of any project” described in the
UN Declaration on the Rights of Indigenous Peoples (UN 2008: 9) that have not been
respected. In the case of Mexico, this is partially due to the virtual absence of sufficiently
effective institutionalisation processes and constitutional guarantees that are needed for
the functioning of rights in general, and indigenous rights in particular48
.
Other ways communities have been affected are mainly restricted to landholders. First,
some wind projects seem to have had severe impacts on land quality and irrigation
systems, although this is a subject that would certainly need closer investigation. In
general, landholders appear to have been underpaid by wind companies, a fact that was
facilitated by the monopsony position of the latter. Furthermore land contracts were lacking
transparency. For instance, many contracts restrict possibilities for small agricultural loans
but do not explicitly state this in the contract, or at least not in a language that is
straightforward and understandable (González Pedro 2012).
The Mareñas project, although still being developed, has already caused protest by
local Huave indigenous communities, for who certain areas included in the design of the
project are sacred. Moreover, both Huave and Zapotec fishermen fear the project will
affect local ecosystems and as a result compromise their fishing activities. I cannot help
noticing certain similarities here with the Belo Monte case, nor can I resist uttering the
feeling that this case might well be exemplary for the future of wind power in the Isthmus
region, and possibly the LAC region as well.
However, as a more optimistic scenario, the first stage of a COWF currently being
carried out in Ixtepec has been assessed. Unlike the CFE and the companies carrying out
wind energy projects in the region, the principal goal around which Yansa’s organisational
and financial structure have been designed are local communities. As has become clear in
48 This was also one of the principal conclusions of the colloquium "Reflexiones teóricas en torno a los
derechos de los pueblos indígenas" that took place from 31 August to 4 September 2009 at the Law Faculty
of the Universidad Nacional Autónoma de México and which was attended by the Author.
56. 52
chapter 5, this has already proven to mitigate many social disruptions commonly
witnessed in other cases of wind farm development. Moreover, while the project will not be
free of externalities, a primary goal is to keep impacts to a minimum and carefully assess,
publish and evaluate any remaining problems. Finally, in case the project in Ixtepec
succeeds, part of the revenue will be used for the conservation of indigenous language
and culture, and for the revitalization of traditional agriculture, of agroecological methods
that will diminish the need for fertilisers (Vásquez García 2012). Among other arguments,
the latter is perhaps one of the most important reasons for suggesting that using
discourses on ‘sustainable development’ as a vehicle for change might a much more
pragmatic strategy than throwing the baby out with the bathwater.
That said, it is important to note that environmental effects of wind farms in the region,
that serves as one of the most important corridors for bird migration worldwide, have been
insufficiently been taken into consideration, nor have the indirect consequences of mass
bird mortality for humans in Mexico and Latin America. This, together with the impact of
wind farms on land quality, is definitely recommended as a line of further investigation.
