Water and communities: resources worth protecting

Published on Thursday, 1 September 2016

In Chile, Enel subsidiary Endesa has suspended construction of five hydropower projects totalling 821 MW that are no longer considered socially, environmentally and economically sustainable.

​Creating shared value for the company and the communities in which it operates sometimes means going back on what was said.

The growth strategy adopted by Enel over the past two years has led all the Group business lines to embrace a dramatically new approach to investments and review the feasibility – in terms of environmental, social and economic sustainability – of all the infrastructural projects that are still being assessed.

Embracing this new approach, Tuesday, August 30, Endesa Chile’s board of directors decided to waive water exploitation rights for the construction of five hydropower plants, totalling 821 MW in capacity.

‘In line with the Group’s Strategic Plan,’ the Chilean subsidiary’s CEO Valter Moro explained, ‘we intend to focus exclusively on the construction of technically and economically feasible infrastructure that is shared with the communities where it will be built. As regards these hydropower projects, based on studies that have been conducted, we found that they were no longer sustainable and thus waived our water exploitation rights, restoring them to Endesa Chile so they can be used for another type of development.’

Moro specified that the decision was made after having carefully studied the feasibility of the projects, based on the new high sustainability standards set for the entire Group. Therefore, besides their profitability, their social and environmental impact was assessed, as well as the necessary technical requirements.

The five hydropower plants that will no longer be constructed – totalling 821MW in capacity –were to be built in different areas of the South American country: Bardon (Cautín River, La Araucanía, 14 MW), Chillán 1 and 2 (Chillán River, Biobio Region, 17 MW), Futaleufu (Futaleufu River, Los Lagos Region, 1,330 MW), Puelo (Puelo River, Los Lagos Region, 750 MW) and Huechún (Metropolitan Region, 40 MW).

In Chile, our subsidiary will continue working on the optional project portfolio in order to foster the development of those projects that are truly competitive and necessary for the country’s development, respecting the environment and in a spirit of sharing with the local communities.

We are committed to achieving a new energy development model, even when this means going back on what we said whenever we are dealing with a project that is no longer sustainable, for us and for the places in which we operate.

This is why we are dramatically changing our approach to designing our energy infrastructure, starting by listening closely to those affected, and we are assessing all the elements involved, from the social and environmental effects to the choice of materials and the planning of future decommissioning of the plants.