Communication of National Welfare

According to legitimation drivers of national welfare communication, the more communities or societies accept or stand for an electricity project, the easier it is for a project developer to advance installations. Hence, it would be appropriate and morally correct to make energy decisions that produce national welfare in terms of poverty reduction, job creation, economic competitiveness, etc. Drivers of national welfare, reinforce technologies that increase these effects because it is the right thing to do based on subjective beliefs.

Since earlier stages, hydroelectric dams became the main electricity generation infrastructure of the national system. During the “Developmental State” era, the ICE took advantage of economies of scale from dams, developing efficiencies at individual level of projects to provide large quantities of electricity at low cost. Its dominant position was reinforced in subsequent decades, partly explained by efficiency mechanisms, but also upholding this position by logics of legitimation.

The development of dams, as well as geothermal fields; were institutionalized by Law 449 (1949). In Law 449 (1949) it was established that the ICE’s mandate was that of “controlling hydroelectricity utilization to strengthen the national economy and the welfare of the Costa Ricans” (Article 1). Similarly, the emergence and expansion of the geothermal resource was a matter of public interest for the state, as stated in the Geothermal Law 5961 (1976). This statement was confirmed by project developers at the ICE. According to interviewees, the goal, at that point, was to develop an “ambitious and innovative project with renewable sources of the country”, which needed political and financial support from different actors (Mayorga, 2013, p.

9).

On a national level, dams rendered numerous social and economic benefits to accomplish goals of the country’s national electrification. As pointed out by Bull (2005), the ICE not only gained a good reputation and credibility regarding its efficiency and technical standards, but also provided political results to the governing elite in terms of content voters that benefit from electricity services. Besides, the Institute also gained legitimation in the eyes of the general public.

Furthermore, the technology was largely supported by international financial organizations since the beginning and professional associations, such as the International Commission on Large Dams (ICOLD), who considered dams “appropriate” in order to fulfill energy needs from

173 the population and reach important levels of economic growth (WCD, 2000). According to the World Commission on Dams (WCD), multilaterals were considered strong particularly among countries that have not built many dams and do not have local planning and construction expertise and capacity.

“In Costa Rica, which relies on hydropower for roughly 90% of its power generation, the World Bank and the IDB had directly supported over half of the installed hydropower capacity by the mid-1990s” (WCD, 2000, p. 78).

Likewise, international financial organizations not only provided funds for the construction of dams, but also capacity building. In fact, at a national level, Costa Rican engineers and politicians who held high positions in the electricity sector (i.e. related to the ICE) were trained abroad and became members of consolidated international professional organizations. One of them is ICOLD ensuring “that dams are built safely, efficiently, economically, and without detrimental effects on the environment”.¹⁵⁸ Between 1990 and 1996, the executive chairman of the ICE and CNFL was the national representative of ICOLD in Costa Rica.

By the end of the 1990s, the results were quiet positive in terms of national welfare and their communication was effective for the energy-planning sector. According to regional reports and national statistics, the ICE provided an integrated system with national coverage of electricity and communication networks that reach 95% of the population in 1999. Moreover, the electricity price was one of the lowest in Central American, mainly due to hydroelectricity, while costly fossil-fueled electricity generation has been dominant in the other countries (PEN, 2008).¹⁵⁹

At the same time, the ICE itself enjoyed a special standing in the society. For instance, Amador (2000) analyses the myths surrounding the ICE arguing that the institute became a complex symbol for the Costa Rican population (i.e. external myth), connected with a range of words including ‘innovation’, ‘technological sovereignty’, ‘welfare of the popular sectors’, ‘human protection’ and ‘community solidarity’ (Amador, 2000, p. 1). This was combined with an internal Institute’s myth of creating a “new man” and characterizing it with a messianic sentiment of a historic mission to serve the Costa Rican people (Amador, 2000).

Moreover, such achievements being the outcome of own resources, developed by a Costa Rican company, brought up aspects of national pride. For instance, during the 1995-1998 period, the geothermal installed capacity reached up to 110 MW, as pointed out by the ICE’s planning

158 The Era of WCD belongs to the past. (2011-2012). Retrieved January 2014, from http://www.tcsr-icold.com/Detail/49

159 ICE, 2013. Indice de cobertura eléctrica 2013.

174 managers “it was completely developed through Costa Rican ownership” (Mayorga, 2013, p.

40). However, since the beginning, it was clear that in the case of geothermal projects, the major limitation to their future development was the possible environmental restrictions because part of the geothermal systems were located within protected areas (e.g. the geothermal system of the Rincón de la Vieja National Park) (Battocletti, 1999).

In the case of dams this position is even more evident. In the year 2000, the ICE’s project managers presented the Boruca HP (i.e. 1500 MW) as a project that will deliver several national and local welfare. They include supplying 60% of national energy demand, selling electricity to the Regional Electric Market during the first 5 years, and granting benefits to local communities through the generation of employment and tourism potential. Furthermore, project developers highlight the lack of other energy alternatives for Costa Rica (Sacchi, 2002).

By contrast, in 2000, a report from the WCD also recognized the significant contribution of dams to human development, but also remarked the elevated cost it implies for people to be displaced, communities downstream, taxpayers and the environment, stating that “in too many cases an unacceptable and often unnecessary price had been paid to secure those benefits”

(WCD, 2000, p. 310). This conclusion had repercussions on national energy decisions when, in 2005, the WB and the IDB, declined to finance the Boruca HP (Carls & Haffar, 2007).

The incorporation of private investors after liberalization reforms, did not alter the pattern of the electric system based on hydroelectricity, on the contrary, it was reinforced through the proliferation of RORs. The aspect of environmental sustainability was highlighted as one advantage of these smaller hydroelectric plants. According to the World Bank, “run-of-the-river projects differ from conventional hydropower projects in that they require no water storage and are less likely to alter environmental flows” (The World Bank, 2008). Private developers also argue in favor of them, since they do not interrupt the river flow. Interviews with private investors from this period also pointed out its relatively low footprint (Interview 5I; Interview 5M, 2013).

Nonetheless, support towards larger hydroelectric projects, among the ICE and development banks, did not change during this period either. Hydroelectric installations continued growing mainly driven by claims of national and regional growth of electricity consumption (Carls &

Hafar, 2010). In 2008, the government declared the Diquís HP, a downsized version of the

175 Boruca HP, a project of national convenience and public interest, even with pending Environmental Impacts Assessment’s proceedings among other legal inconsistencies.¹⁶⁰

A declaration of national convenience implies that social effects overpass socio-environmental impacts, meaning that a regular Environmental Impact Assessment wouldn’t be enough (i.e.

cost benefit assessments at individual level). These logics are comparing, and opposing, the benefits at national level with the effects at local level. The government, the Energy Planning Sector and the ICE support the continuation of dams based on drivers of national welfare communication. Meanwhile, the local welfare of hydroelectric projects, large or small, are questioned by communities and environmental organizations based on problems of local sustainability. In fact, the declaration of ‘national interest’ of the Diquís dam was followed by the opposition from local, national, and international organizations. This indicates problems of legitimation for the local welfare communication, possibly reversing legitimation mechanisms for the reproduction of hydroelectric projects in future decisions.

This aspect evidences a change, in terms of external and internal perceptions or myths, of the institute as well. As pointed out by the ICE’s presidency, “nowadays, the environment is more aggressive and centered on the debate of competitiveness” (Interview 4N, 2013). In this sense, the ICE behaves with a commercial purpose to sell services, but the balance sheet is more important in telecommunications that in electricity. Internally, there are also changes in people.

The same official remarks the loss of membership from the ICE’s employees: “There are micro-cultures within the ICE and there is a global outfit. Employees are very creative in project design in their own spaces” (Interview 4N, 2013).

Those statements confer to high levels of confidence in engineering capacity of the ICE within the institute. Among energy sources, dams and geothermal fields installations are guided by the higher standards as they are considered an endogenous technology.¹⁶¹ These aspects denote logics of efficiency, but also reinforced by legitimation in terms of national welfare communication.

The Diquís dam is an example of this reinforcement and increasing electricity tariffs provided the setting for the government and political parties in campaign to declare this project as a priority. After years postponing the decision, in political discourses towards elections in 2014, politicians referred to the Diquís hydroelectric project as the solution to national problems such

160 14.07.2011. “El Diquís, frente a la jurisprudencia de la Corte IDH”; 01.11.2012. “Ilegalidades del Proyecto Hidroeléctrico Diquís”.

161 The term, endogenous technology, refers to a technology that is being produced, used and reproduced in a structurally confined production system. The knowledge needed is locally available and disseminated in the society; and the production organization is embedded in the local institutional setting (Müller, 2011).

176 as the cost of living, inequality, or poverty (Araya, during forum in 2013).¹⁶² The dam, also became the center of the renewable energy scenario required to accomplish the country’s goal of carbon neutrality in 2021 (MINAE, 2010).

On a global level, there is also evidence of this reaffirmation of dams’ advantages in a context of global climate change. Differing from the principles and suggestions of the WCD in 2000, in 2012 the World Bank Vice-President for Sustainable Development and several officers from developed and emerging economies, such as the United States, China and Brazil, declared that there is no such thing as a “without dams alternative”, particularly, in light of climate change mitigation. The opposite applies to ROR, considering “that a few large dams were much better than many small dams, both for the environment and for the economy”.¹⁶³

What is more, these arguments marked a distance between dams and ROR, while the possibilities of alternative renewable sources were obviated or at least not mentioned within these statements. The perspective of other actors concerning the appropriateness of renewable energy sources, including the alternatives, revealed that their preferences are not so different from the government and international organizations. Furthermore, their drivers are similar, except in the case of environmentalists who made reference to global climate change and local considerations.

During interviews in 2013, politicians and the media respondents commented that their preferences between sources depend on which is better for the environment or which prevents oil dependency (Interview 1I; Interview 4Q, 2013). Following such responses, the interviewed consider that besides hydroelectricity, geothermal is preferable, followed by solar energy, wind energy, and biomass. In opinion of right-wing politicians (i.e. Movimiento Libertario, ML), large dams are a priority, but delays in projects caused by social opposition put geothermal stations as the second best option (Interview 1J, 2013). Solar energy is gaining attention from private developers and right-wing politicians as well, in applications at a utility and consumer level, such as the DEG (Interview IJ, 2013; Interview 5D, 2013).

In fact, since 2010, a group of bill proposals were submitted by deputies from the official party (PLN) and the right-wing party (ML) to allow geothermal exploitation in natural protected areas by the ICE (Files No. 17680; 17707), and to incorporate private actors into this activity (File

162 In a context of increasing electricity tariffs, presidential candidate J. Araya referred to the Diquis dam with the following statement “the main enemy of communities is poverty” (Forum: “PLN future energy…” 01.10.12).

163 The vice-president also pointed out the example of water evaporation, much larger in small projects than in larger ones, and also to the question that should be asked “what happens if this project is not built?” (The Era of WCD is belonging to the past. (2011-2012). Retrieved January 2014, from http://www.tcsr-icold.com/Detail/49)

177 No. 18182). Their arguments to change existing laws that lay down the exclusion of commercial activities in natural protected areas and the exclusiveness of the state for the exploitation of geothermal resources alluded to the utilization of geothermal energy as “a source of national development and sustainable financing to the National System of Conservation Areas” (File No.

17707, Art. 1) or “human wellbeing”, “to pursue national sustainable development and ecologically sustainable of Costa Rica” (No. 18182, p. 1). The proposals also make reference to low carbon emissions of geothermal energy.

Environmentalists interviewed in 2013 favored the geothermal energy alternative first, followed by dams, as an option for electricity generation at larger scales (Interview 2J; Interview 3E, 2013). Yet, in the case of dams, environmentalists’ saw them as a response technology to global climate change mitigation and adaptation. According to them, “Only as long as dams are constructed properly and guarantee fair compensation to displaced communities” (Interview 2J, 2013).

In general terms, respondents from environmental organizations opt for smaller developments that take advantage of primary energy sources (i.e. solar energy, wind energy and wave energies) followed by biomass, geothermal and hydroelectricity (Interview 3E, 2013). They argue that there is no such thing as a “good energy” but rather their combination and diversification is the key towards saving energy resources (Interview 2J, 2013).

State and private investors also support wind park developments given the large potential in the country and the favorable business opportunities (Interviews 5D, 2013). Their claims have been based mainly on efficiency mechanisms. First, they pointed out to technology competitiveness;

second, to their advantages for the overall energy system to complement hydro and displace fossil fuels.

Concerning solar energy, private and state investors mentioned that off-grid applications at smaller scales produce less socio-environmental impacts and are more flexible; however, they generate disposable batteries that are avoided at on-grid larger scales (Interview 3L, 2013). At the same time, automation increases on larger scales, hence creating less jobs (Interview 2H, 2013), while increasing competition with alternative land use (Interview 3H, 2013).

Nonetheless, opinions on the results of the first solar park (i.e. Miravalles) diverge among actors. Most private investors and right-wing political parties have been critical on the lower capacity of the pilot project and the high cost of installations (Interview 4G; Interview 1J, 2013). Project developers at the ICE acknowledged such limitations but also argue that it is not located in the best site (Interview 3H, 2013), although its location is also strategic: “The Solar

178 Park Miravalles became part of a renewable energy corridor of the Guanacaste province, the only in the world within a 15 km radius” (Interview 3J, 2013).

Besides the solar park, located at the Miravalles Generation Center this corridor includes the Miravalles geothermal production center, the wind park Guanacaste and the hydroelectric plant Arenal. According to the solar park managers, the project has a demonstrative and educative purpose. First, it allows to study the behavior of the technology on larger scales, and second to attract numerous visitors from diverse population groups (e.g. students, politicians, national, and foreigners) (Interview 3J, 2013).