Belo Monte, delays and costs
Late works, environmental requirements not met and the continuous increase in the cost, which is estimated at almost twice the initially planned, are the new design features of the Belo Monte dam on the Xingu River in the State of Pará. Always remembered by the Government as the world’s third largest hydroelectric installed capacity of 11,233 MW-but will not effectively more than 4,500 MW, the Belo Monte plant is questioned since the announcement of the project. Its construction is generating more criticism.
Among other things, the plant is questioned by their environmental impact, by the technical solution adopted, which reduces their effective capacity of production, and their economic and financial risks. These risks away private investors and required the strong participation of State capital in the consortium responsible for its construction and operation. Became a project clearly.
Budgeted at $ 16 billion, auctioned for $ 19 billion, financed by $ 29 billion, the plant has already cost estimated at $ 30 billion, but this is not definitive value: continue to rise until the end of the works, which are about a year delayed against the schedule, which provided for the beginning of its operations in December 2014.
The outages caused by invasions of the construction site by Indians or by strikes of workers unhappy with working conditions or remuneration contributed to delay the work. Last week, for example, as showed the State report (12/5), 83 Indians invaded the area where it is being built the dam power house. Since the beginning of the works, already have registered 15 invasions and 16 days of strike.
Any labor issue can have an impact on the final cost of the plant, because its construction involves currently 22 thousand workers. Claims as small improvements in the benefits, among which the value of the basic basket, affect the economic and financial calculations and therefore often result in stoppage of the works.
In socio-environmental area, the North Energy Consortium, responsible for the works has already been fined $ 7 million for failure to comply with demands made by Ibama to grant the installation license of construction sites and the beginning of the works. When the fine was imposed, of 86 environmental programs, only 15% had been completed.
The last project monitoring report showed that, of the programs required by Ibama, 49% are in proper rhythm. Delays in such programs for prosecutorial justice requests for the suspension of the environmental license and the stoppage of the works.
Until today has not been contracted the electromechanical Assembly of equipment, because the Consortium is not able to hire by the budgeted value. The suppliers of these services are requiring at least 60 percent more.
The problems faced by the North Energy Consortium in the construction of the Belo Monte plant will reduce the profitability of the project, initially scheduled in 10.5% per year. Some financial institutions already calculate the actual return of 6.5% per year.
Who else will lose with this is the public sector. Considered one of the most vibrant parts of the growth acceleration program, created in the Lula Government and boosted the election campaign of the current President of the Republic, Beautiful Lot only left the role after the Government put State enterprises on the two consortiums that vied for the work in 2010 and announced huge funding by the BNDES.
The substitution of private partners of the North Energy Consortium for State pension funds of State employees made the typically governmental venture. Is the Government, that is, the taxpayer, which will bear the rising costs for a project that will yield far less than advertised.