UN climate fund should learn from past mistakes and reject large hydro dam projects

In a controversial move, the Board of the Green Climate Fund (GCF) has approved three large hydro dam projects, despite concerns raised by civil society on the extensive adverse social and environmental effects these projects can have. This development has to be seen very critically, especially considering past negative experiences under the Clean Development Mechanism (CDM), a prominent example of which is the Barro Blanco project in Panama.  

The Green Climate Fund was set up under the Paris Agreement with the goal to promote a paradigm shift by providing financial support to developing countries to limit or reduce their greenhouse gas emissions and to adapt to the impacts of climate change. Channelling vast amounts of climate finance, it is crucial to ensure that the fund doesn’t support harmful or business as usual solutions to climate change.

At its meeting in April 2017, the GCF Board approved eight projects worth $750 million in funding, including three large hydro dam projects in Nepal, Tajikistan and the Solomon Islands. This decision was taken despite 272 organizations expressing their concern about large hydro’s grave negative impacts with regard to the environment, human rights, and economic cost, and urging the board to reject the projects.

Case in point – Barro Blanco

Such adverse consequences are evident when taking a closer look at the Clean Development Mechanism. Barro Blanco hydro dam in Panama is an example of a climate mitigation project that does more harm than good.

Although Panama’s government decided to deregister the project from the CDM last year, meaning that no credits will be issued under this project, reservoir flooding continues. An ongoing “test” has since June 2016 destroyed some of the Ngäbe people crops, houses, and religious sites.

Arguing that they have not been properly consulted,  indigenous communities continue to oppose the dam. On March 31st, their representatives pleaded the case during a hearing at the Inter American Commission on Human Rights. They are requesting the flood waters to be lowered below their territories line and that the project’s European co-funders – German and Dutch development banks – participate in their dialogue with the government. Last February, international NGOs also called for the UN Special Rapporteurs to carry an on-site visit to assess the situation.

Despite the international mobilisation, there will unlikely be a positive outcome for the Barro Blanco project. At the end of March, a representative of the national agency supervising the flooding indicated that the project would begin its operation soon. International NGOs are still calling the project manager to put a halt on it until an adequate consultation process has been carried out and fair compensation for the communities is agreed.

Since its beginning, Barro Blanco illustrates the pitfalls of large hydro projects. By continuing to finance this type of activities, the GCF is failing to comply with its paramount objective of promoting a paradigm shift in developing countries.

By Juliane Voigt and Pierre-Jean Brasier